Follow the Money
Money and politics. There’s a reason this issue features a report on wealth in Texas alongside a pair of stories that look ahead to the 2014 elections. Despite the occasional quixotic effort to remove the former from the latter, the two are deeply intertwined. Only in very rare instances does either exist independent of the other; in most cases, they are as inextricably linked as a racehorse and his jockey.
The forty Texans listed on page 138 are the state’s wealthiest individuals (their net-worth figures come to you through a partnership with Forbes, which this month publishes its annual Forbes 400 list, the gold standard—pun intended—of such compilations). Among them, not surprisingly, are some of the state’s largest political donors, people like H-E-B chairman and CEO Charles Butt, who to date has donated $94,000 of his $8.5 billion fortune to Democratic state senator and likely gubernatorial candidate Wendy Davis (as well as $75,000 to Rick Perry), and Dallas oilman Ray L. Hunt, a major funder of George W. Bush’s campaigns, and Harold Simmons, who has given $650,000 of his $10 billion to the man on this month’s cover, Attorney General Greg Abbott. (Simmons will likely be a presence in the race for lite guv too; he has previously given $120,000 to commissioner of agriculture Todd Staples, plus $7,000, which one imagines him scraping up from his couch cushions, to state senator Dan Patrick.) Abbott, of course, is the prohibitive favorite to win next year’s gubernatorial election, in part because of his eye-popping early campaign chest of more than $22 million. For all the excitement generated by Davis’s rise to national prominence, she still has only around $1 million cash on hand; she’ll probably need $35 million to mount a strong challenge.
But it’s not just politics that runs on money. The reverse is also true, as Butt, Hunt, or Simmons could tell you (though they might not want to). At times this may be as simple as a little pork-barrel spending—Brown & Root, the Houston-based construction company that became global behemoth KBR, owed much of its early success to the thoughtfulness and generosity of Lyndon B. Johnson (and vice versa). In other situations, the benefits an industry reaps from political influence are more indirect, as with the slew of tax breaks, credits, and loopholes that oil and gas companies enjoy; many of these subsidies are now outdated, but they remain protected by, well, pretty much everyone in politics (bread, after all, does not butter itself).
And sometimes the relationship is even more abstract. Senior editor Erica Grieder’s fascinating profile of Richard Fisher, the president and CEO of the Federal Reserve Bank of Dallas (“Money Makes the World Go Round,” page 134), illuminates the arcane thinking that goes into the Fed’s monetary policy, the slightest change in which can trigger a massive swing in the markets. The Fed, of course, is quasi-independent, and Fisher’s position is unelected, but it’s worth pointing out that it was none other than Ray L. Hunt, then chairman of the Dallas Fed’s board, who helped get him the job.
Money and politics. The only real question is, Which is the horse and which the rider?