Freddie Mac, AIG, Lehman helped finance convention

By Jonathan D. Salant, Bloomberg News

Published October 31, 2008 at 8:05 p.m.

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Financial companies at the center of the U.S. credit crisis including American International Group Inc., Lehman Brothers Holdings Inc. and Freddie Mac helped pay for the Democratic National Convention in Denver, documents show.

Their individual contributions were dwarfed by those from companies in other industries, including San Jose, California-based Cisco Systems Inc., which gave $1.7 million worth of equipment. Donating $1 million each were Omaha-based Union Pacific Corp., Minnetonka, Minnesota-based UnitedHealth Group Inc., and Minneapolis-based Xcel Energy Inc., according to Federal Election Commission documents.

New York-based Lehman, whose Sept. 15 bankruptcy was the largest in U.S. history, gave $100,000 to the Denver convention. New York-based AIG, which got an $85 billion U.S. government loan last month in exchange for a controlling stake in the nation's biggest insurer, contributed $750,000. Mortgage giant Freddie Mac gave $250,000. The U.S. government took over McLean, Virginia- based Freddie and Washington-based Fannie Mae last month.

Many of the companies also gave to the Republican host committee in St. Paul, Minnesota. The Denver committee raised $61 million; the St. Paul group raised $50 million, FEC records show.

While the donors were listed on the Denver committee's Web site and publicized at the convention, the size of the contributions was not made public until the FEC filings. There are no limits on donations to the political conventions, which, unlike contributions to individual candidates' campaigns, can come directly from corporations and unions.

Several contributors to the Denver host committee recently received billions of dollars from the federal government under the $700 billion financial rescue plan. The government got preferred stock and warrants in return.

New York-based JPMorgan Chase & Co., which sold a $25 billion stake to the government, donated $100,000. Wells Fargo & Co., which also sold a $25 billion stake, gave $260,000. Goldman Sachs Group contributed $250,000 and Morgan Stanley gave $150,000; the New York-based banks sold $15 billion and $10 billion in shares respectively to the U.S. Treasury.

The Laborers International Union of North America gave $1.5 million to the Denver host committee. Four other unions, American Federation of Teachers, International Brotherhood of Electrical Workers, National Education Association and Service Employees International Union, gave at least $1 million each.

For the Republican convention, Freddie Mac and AIG each gave $250,000, Goldman Sachs gave $255,000, and Morgan Stanley donated $100,000. JPMorgan Chase, which bought Bear Stearns Cos., contributed $100,000.

Convention contributors

Financial institutions at the center of the U.S. credit crisis contributed to both the Democratic and Republican national conventions.

Institution to DNC to RNC * Lehman Brothers $100,000

* AIG $750,000 $250,000

* Freddie Mac $250,000 $250,000

* JPMorgan Chase & Co. $100,000 $100,000

* Wells Fargo $260,000

* Goldman Sachs $250,000 $255,000

* Morgan Stanley $150,000 $100,000

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