Buyside firms are pumping more money into politics. In the run up to the 2020 election, private equity and hedge funds accounted for over $625 million. It was the most this segment of the financial industry spent on lobbying and campaign contributions in a two-year campaign cycle. During the 2015-16 cycle, the amount was just over $500 million.
For everyone that was wondering, the study doesn’t include a breakdown of party affiliation or which candidates received the most money.
The largest chunk ($547 million) went to contributions for candidates running for federal office, and the rest ($78 million), went to lobbying. Private equity spent $70 million of that, and hedge funds spent about $8.5 million.
Spending was more evenly split when it came to campaign contributions. More than $262 million came from those in the private equity sector, while over $285 million came from the hedge fund world.
Donors at Citadel, who spent $67 million, at Blackstone, $43 million, and at Susquehanna International, $30 million, accounted for the biggest spending on contributions to federal campaigns last cycle.
Short Squeez Takeaway: As Democrats in Congress aim to ramp up regulations on these sectors such as Sen. Elizabeth Warren, who recently reintroduced the Stop Wall Street Looting Act, which seeks to end the carried interest loophole that private equity firms have taken advantage of for years, we only expect political spending from buyside firms to increase.