President Joe Biden speaks about the $1.9 trillion “American Rescue Plan Act” as House Speaker Nancy Pelosi (D-CA) and Senate Majority Leader Chuck Schumer (D-NY) listen during an event to celebrate the legislation in the Rose Garden at the White House in Washington, March 12, 2021.
Tom Brenner | Reuters
Several major Democratic donors have warned leaders in Congress that they may hold back on donations for next year’s midterm elections unless the party can come together and get some big wins, according to people with knowledge of the matter.
Financiers have said behind the scenes that they are frustrated with lawmakers who have yet to pass President Joe Biden’s sprawling economic agenda.
Donors have also described their frustration with the gubernatorial race in Virginia, where Democratic power player and former Gov. Terry McAuliffe is running neck-and-neck with Republican Glenn Youngkin, a wealthy former CEO of the Carlyle Group.
These revelations come on the heels of a new NBC News poll showing that a majority of voters surveyed disapprove of Biden’s job performance.
The House could vote this week on Biden’s plans. House Democrats have resisted voting on a $1 trillion bipartisan infrastructure plan that already passed the Senate until they could vote on a $1.8 trillion social safety net and climate bill.
The social bill, which would require the vote of every Democratic senator, has been the subject of months of negotiations between the White House, progressives such as Sen. Bernie Sanders and Rep. Pramila Jayapal, and centrist Sens. Joe Manchin and Kyrsten Sinema. Among other items, the plan includes six years of funding for universal preschool for 3- and 4-year olds, subsidized child care that caps what parents pay at 7% of their income, and a four-year extension of pandemic-era Obamacare subsidies.
Donors have expressed their frustration with the state of the party’s affairs in conversations with leaders including House Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer, people familiar with the matter said.
“Anytime there’s been an event with the Democratic leadership whether it’s in-person, Zoom or on conference calls, donors are venting their frustration at the very public fighting among Democrats and the lack of progress on Biden’s agenda,” said a leading party bundler, who declined to be named.
People who described the conversations declined to be named due to the private nature of the talks. The conversations have taken place in virtual and in-person settings, these people added.
Representatives for Pelosi and Schumer did not return requests for comment before publication.
The president’s party tends to lose seats in Congress during first-term midterm elections. And so far, several top major party donors are less than pleased with how Democrats have used their power in the White House and in Congress, where the party has razor-thin majorities in both houses.
One longtime Democratic donor and bundler on Wall Street is already planning to hold back on donations.
“I am going to take a step back. Not overly thrilled with how things are going,” the financier said. This person has helped Democrats in Congress and multiple nominees for president, including Biden, Barack Obama and Bill Clinton.
Other donors are already adjusting their donation strategies ahead of the midterms.
“I’ve already redirected a larger contribution last week away from the Democratic Congressional Campaign Committee to one of the outside expenditures because I know at least three PACs will spend my money in a much more directed way,” a wealthy Democratic donor said, referring to the intra-party tensions in Washington and the race in Virginia.
Others privately acknowledge that there will be a serious pullback in fundraising and contributions to party leaders if McAuliffe loses to Youngkin in Virginia.
The Democratic Governors Association, as of late last week, had been telling party officials that its internal data showed McAuliffe with a tight lead over Youngkin, according to a person familiar with the matter. Early voting is under way in the commonwealth, and Tuesday is Election Day.
David Turner, a spokesman for the DGA, told CNBC in an email on Monday that their analysis on the race is that it’s close and they’ve maintained a small lead since September.
“We have said throughout the year that we expected the race to be close, and our expectations have not changed. We’ve maintained a small lead since September 1, and that continues to be true,” Turner told CNBC. “We are buoyed by higher than expected EV [early voting] turnout, and a dramatic increase in volunteer engagement over the last couple of weeks. Private polling does not do registered vs. likely, because we make assumptions based on the electorate using the voter file – something most public polls do not do.”
The election in Virginia could serve as a test for how successful each party is with deploying their campaign resources going into the pivotal midterms. Youngkin and McAuliffe have each raised over $57 million, according to data from the Virginia Public Access Project. Republicans and Democrats have each spent over $30 million on ads in the state’s election, according to data from Ad Impact.
Biden, Vice President Kamala Harris, former President Barack Obama and other party leaders have gone to Virginia to campaign for McAuliffe. The Democratic National Committee said in an email to reporters on Monday that the group has invested nearly $6 million toward Virginia’s elections.
With that, some business leaders are waiting until after the contest to decide if they will continue to help Democrats going forward, a top party fundraiser said.
“I think no one will make the decision on how they will invest until after the election,” the fundraiser said.