WASHINGTON: In an unusual mix of investor relations and grassroots political outreach, several corporate giants have sent letters to shareholders asking them to contact members of Congress to support President Bush's proposed dividend tax cut.
The Bush plan faces an uncertain fate on Capitol Hill, as most Democrats and some moderate Republican legislators have expressed deep reservations about passing such a tax cut during a time of war and growing fiscal uncertainty.
Nevertheless, several large dividend-paying companies, including GM, Citigroup, Southern Company, ChevronTexaco, and Verizon, have sent such letters to shareholders.
"We think this proposal makes good economic sense, and is good for our stockholders and General Motors," read a recent letter to GM shareholders from president and CEO Rick Wagoner. "We've shared our enthusiasm for it with members of Congress, and we urge you to do the same promptly."
Although there didn't appear to be a coordinated effort to get companies to reach out to their shareholders, many big corporate lobbying organizations have embraced the Bush plan. The influential Business Roundtable (BRT), a Washington-based association of CEOs of many of America's largest corporations, has been among the most vocal backers of the Bush plan, and has urged its members to find ways to publicly support the tax cut.
"The Roundtable is helping head the effort to support the economic growth package," said Tita Thompson, deputy communications director for the BRT.
"That effort has many components, including paid media, earned media, grassroots, and pure lobbying. And many CEOs are deciding on the tactics they use within their companies. One of those has been letters to shareholders."