The 2016 presidential election is already being billed as the most expensive in history, but the value of its impact on U.S. companies and multinationals operating in the U.S. could be much greater. From the fate of corporate inversions to the future of energy and climate change regulations, never before has so much ridden on the outcome of a single vote. For more information contact: David Sutphen: www.brunswickgroup.com/people/directory/david-sutphen/ Or our Washington, DC office: www.brunswickgroup.com/contact-us/washington-dc/

1. © BRUNSWICK | 2016 | 1
2016 U.S.
Presidential
Election Brief
April 2016

2. 2 | 2016 | BRUNSWICK ©
Candidates
In the 2016 U.S. presidential primary, political
outsiders are significantly influencing the policy
positions of the Republican and Democratic parties
on the issues that matter most to companies
operating in the United States.
Donald Trump A prominent real estate mogul who has upended the Republican primary, thwarted the party
establishment, and continues to dominate the news cycle with calls for immigration restrictions
and the building of a wall along the U.S.-Mexico border, as well as with his harsh criticism of
American companies that have moved manufacturing operations out of the U.S.
John Kasich A former U.S. congressman and current governor of Ohio who has won only his home state’s primary
to date and severely lags behind Trump and Cruz in delegates, despite being viewed by many as more
electable than either candidate in the general election.
Ted Cruz A Harvard-educated lawyer and U.S. senator from Texas campaigning as a strict constitutionalist
who routinely castigates “the Washington cartel.” Due to this kind of rhetoric, he has made few
friends in the Senate or the Republican Party.
Hillary Clinton A former secretary of state who is poised to be the first woman in American history to win the
nomination of a major political party for president, but faces an enthusiasm gap with liberal
“millennial” voters because of her perceived ties to Wall Street.
Bernie Sanders A 74-year-old democratic socialist and U.S. senator from Vermont who has captivated the young
progressive wing of the Democratic Party with his unabashed support for universal healthcare,
opposition to the Trans-Pacific Partnership, and stringent anti-Wall Street talking points.

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Republican
Party
State of Play
Both parties hold nominating contests in each of the 50 states and
territories to determine their respective nominees for president.
Candidates compete for each state’s delegates, who, in turn, will be
responsible for formally selecting a nominee during the Republican
and Democratic National Conventions later this summer.
The rules governing how delegates are awarded vary for each
party and also by state, thus the calculus—and state of play—for
each candidate differs.
B
etween February and June, each state (and
territory) holds primaries or caucuses
to determine the allocation of 2,472
delegates to the Republican National Convention,
which will be held July 18–21 in Cleveland, Ohio.
To receive the nomination, a candidate needs to
receive the votes of a simple majority (1,237) of
the delegates to the convention.
Currently, Donald Trump holds a significant
lead in the delegate count. However, Mr. Trump
still needs to win a number of primaries to
get to 1,237. If he does not reach this number
before the July convention, the convention will
become “contested,” or “open.” This would
entail the 2,472 delegates voting until a single
candidate receives a majority of votes. Contested
conventions are exceedingly rare in the modern
era, and in the past have featured extensive
deal-making and strategic back-channeling
in order to swing votes to one candidate or
another. If Mr. Trump fails to secure a majority
of delegates before the convention, he could lose
the nomination to a candidate who is better-
versed in party politics and whose campaign has
focused more intently on the delegate
allocation processes.
Although he trails Mr. Trump in delegates
by a significant margin and it is no longer
mathematically possible for him to clinch the
nomination before Cleveland, Senator Cruz
remains a viable challenger. In the event of
a contested convention, his appeal with core
conservative voters and longtime criticism of
his Senate colleagues make him an attractive
second-ballot option—particularly given his
recent choice of former Hewlett-Packard CEO
Carly Fiorina as his vice presidential candidate.
It remains to be seen, however, whether a
potential Cruz-Fiorina ticket will have sufficient
crossover appeal to sway general election voters
and prevail against likely Democratic nominee
Secretary Clinton.
By contrast, Governor Kasich is the last
standing Republican “establishment” candidate
in the race. While he currently trails Mr.
Trump and Senator Cruz heavily in delegates,
if no candidate wins a majority prior to the
convention, Governor Kasich hopes to position
himself as the safest and most electable
candidate left in the Republican field.
In the event of a contested convention in
Cleveland, odds-makers should watch
Republican National Committee Chairman
Reince Priebus closely. A Wisconsin native,
Chairman Priebus has chaired the Republican
Party since 2011. He could very well find himself
presiding over the first convention since 1976
in which no candidate has managed to garner
a majority of available delegates prior to the
convention being gaveled open. Due to the
convention process and the tight-knit governing
body of the Republican Party, Chairman Priebus
would wield significant influence at a contested
convention, where rules can be altered or
stricken at will to make way for a
compromise candidate.

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L
ike the Republican Party, the Democrats
convene primaries and caucuses from
February through June. Unlike the
Republican Party, Democratic delegates are
awarded on a proportional basis—there are
no winner-take-all states. To secure the
nomination, a candidate needs the support of
2,383 out of 4,765 available delegates. This total
includes 714 “superdelegates”—party leaders
who are free to support the candidate of their
choosing. The Democratic National Convention
will be held in Philadelphia from July 25–28, 2016.
At the time of writing, Secretary Clinton is
on track to win the nomination. Although
Senator Sanders has mounted a passionate and
vigorous campaign, he has been disadvantaged
by the absence of winner-take-all primaries.
Secretary Clinton now holds what is likely to be
an insurmountable lead in the delegate contest—
especially in the wake of her resounding April 19
victory over Senator Sanders in her home
state of New York and her recent primary
wins on April 26.
Yet despite the math being in her favor,
Secretary Clinton has struggled to fully
energize the Democratic base. Small-dollar
donors have fueled Senator Sanders’ campaign
for months now, and millennial voters favor
his populist, anti-Wall Street message over
what they see as Secretary Clinton’s more
establishment approach.
In response to Senator Sanders, and in an effort
to activate millennial voters in support of her
campaign, Secretary Clinton has moved to the
left and recalibrated her message. Perhaps most
notably, she reversed her position on the
Trans-Pacific Partnership—a signature free
trade deal championed by President Obama
that she now vehemently opposes. She has
also emerged as a vocal critic of corporate
tax inversions and the American companies
that have utilized them to secure tax savings
by relocating their headquarters abroad. It is
unclear, however, whether these leftward shifts
will be enough to persuade young liberals to
mobilize on her behalf come November.
If Secretary Clinton does clinch the
nomination, Senator Sanders’ endorsement
may prove crucial for motivating key blocs of
voters—particularly those under the age of 30
and single women, both of which are an essential
part of the Democrats’ strategy but have largely
preferred Senator Sanders thus far—during the
general election.
Even if Senator Sanders loses the nomination,
he will still hold significant influence over
the nomination process. He controls enough
delegates to be a vocal presence at the
convention and influence key party positions
on issues such as trade, Wall Street reform, tax
policy, and national security, though how the
senator will leverage his newfound clout within
the Democratic Party remains to be seen.
Democratic
Party
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Business-Critical
Issues
Though much about this election is still far from settled, four policy arenas
will assuredly impact how businesses operate—and their overall bottom
lines—under a new commander-in-chief.
A
signature initiative of the Obama administration, the now-controversial Trans-Pacific
Partnership comprises 12 countries (U.S., Australia, Canada, Chile, Japan, Malaysia, Mexico,
New Zealand, Peru, Singapore, Vietnam, and Brunei Darussalam) and is meant to reduce trade
barriers among them by lowering tariffs on goods, coordinating regulations, and more. But despite
Congress’s approval of fast track authority earlier this year, TPP may be in jeopardy. The treaty faces
stiff opposition from both sides of the aisle as members increasingly face populist and protectionist
sentiments back in their home districts.
Tellingly, Mr. Trump, Senator Cruz, Senator Sanders, and Secretary Clinton are now all on record
opposing TPP in its current form, at least partially because they do not feel the deal adequately
protects U.S. trade interests and that it could jeopardize the American economy in the face of slowing
growth in global trade. Though all remaining candidates have expressed their opposition to the
present formulation of TPP, it is possible that Congress will choose to vote on it during the lame duck
session after the election. If Congress declines to vote on the agreement this year, the next president
will have the opportunity to either scuttle TPP entirely or push to reopen negotiations with member
countries in hopes of arriving at a new draft.
TPP
Inversions
T
ax reform—whether corporate, individual, or both—has long proven an intractable issue for
Democrats and Republicans alike. Now American companies, at a disadvantage with foreign
competitors, are increasingly seeking tax relief abroad. According to Bloomberg QuickTake,
more than 50 U.S. companies have completed an inversion since 1982, 20 of which have occurred since
2012 alone. While Democrats and Republicans are generally united in their opposition to corporate
inversions, the Treasury Department’s recent regulations targeting inversions and earnings stripping
could be a lightning rod for both parties in the general election—setting up a long-awaited debate
about comprehensive tax reform and the right way forward.
Though Senators Clinton and Sanders have vocally opposed inversions on the campaign trail,
Senator Cruz and Mr. Trump have all taken the more muted position that the practice will end only
after the enactment of comprehensive tax reform that significantly lowers the corporate tax rate
for American companies.

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Energy Policy
and Climate
Change
E
nergy policy in the U.S. has long been the subject of partisan debate, with activists from both
parties tying questions about energy policy to the long-standing political disagreement about
climate change and global warming. This election may prove to be a referendum on the Obama
administration’s Clean Power Plan and multi-party agreements on climate change, as well as on
fracking regulations, the future of clean energy, and U.S. dependence on foreign oil. Secretary Clinton
and Senator Sanders, in particular, have spoken about increasing regulation on, if not outright
banning, fracking, and also about limiting energy exploration activities on public lands.
The Republican candidates have spoken less about regulation of the oil and gas industry and more
about the need to secure America’s energy future by reducing reliance on oil supplies from the
conflict-ridden Middle East and creating new energy jobs on American soil.
Where global warming is concerned, Democrats are proposing stricter and more comprehensive
climate change mitigation plans, while many Republicans remain skeptical that climate change is
occurring and/or stringently oppose costly regulations on those industries responsible for the vast
majority of carbon emissions.
Government
Regulation
I
n a year when many primary voters view “establishment” candidates with acute distrust, the
remaining presidential candidates have increasingly sought to differentiate themselves based
on their views of federal regulation and the extent to which the government should intervene
in the activities of corporates. The 2010 Dodd-Frank Wall Street Reform and Consumer Protection
Act and the enforcement authority of agencies such as the Consumer Financial Protection Bureau,
Federal Trade Commission, and Department of Justice have featured prominently in the primary
election debate about the role government should play in M&A activity, banking regulation, and the
prosecution of corporate wrongdoers.
In the event that the Democratic nominee wins the presidency on November 8, 2016, expect the
Department of Justice and Federal Trade Commission to continue to challenge M&A activity that
the government considers anti-competitive or that could potentially lead to over-consolidation in
a given industry. A victory for Mr. Cruz in the general election will likely result in the significant
relaxation of government regulations on businesses, while Mr. Trump has come out quite strongly
in recent months against American companies using legal loopholes to move any portion of
their operations abroad.
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Republican and
Democratic Stances:
Overview 1
TPP
Inversions
Trump
■■ Opposes TPP.
■■ Trump has asserted
that TPP “was
designed for China
to come in, as they
always do, through
the back door and
totally take advantage
of everyone.” (Trump,
Republican Primary
Debate, 11/10/15 )
■■ Adheres to the party
line that inversions
can only be stopped
by a broader revamp
of the tax system that
lowers the corporate
tax rate for U.S.
companies.
■■ Has proposed cutting
the top corporate tax
rate from 35 percent
to 15 percent.
Cruz
■■ Opposes TPP.
■■ Claims TPP would
undercut U.S.
immigration laws
and take jobs away
from working-class
Americans.
■■ Adheres to the party
line that inversions
can only be stopped
by a broader revamp
of the tax system that
lowers the corporate
tax rate for U.S.
companies.
■■ Has proposed a 10
percent flat tax on
all individual income
from wages and the
elimination of payroll
tax and corporate
income tax in favor
of a 16 percent
business flat tax.
Clinton
■■ Has opposed TPP
since 10/7/15.
■■ Her anti-TPP stance
puts her at odds
with the Obama
administration and
her previous remarks
that she hoped the
deal would become
the gold standard in
trade agreements.
■■ Opposes inversions
and has a detailed
legislative plan to
curb them.
■■ Has advocated for
congressional action
to end inversions.
Wants to target
inversions that are
likely to be the most
abusive via a 50%
merger threshold and
implement an “exit
tax” on the untaxed
overseas earnings of
multinationals that
leave the U.S.
Sanders
■■ Opposes TPP.
■■ Has tweeted: “We
need trade policies
that promote the
interests of American
workers not just the
CEOs of corporations
#StopTPP”
(@SenSanders,
10/5/15)
■■ Opposes inversions
and has proposed
rules to curb them.
■■ Sent a letter in
March 2016 to
Treasury Secretary
Lew proposing new
tax rules aimed
at preventing
companies from
borrowing against
overseas earnings
without paying
U.S. taxes. The
Treasury Department
issued temporary
regulations on
inversions and
earnings stripping
less than a
month later.
1
Given the delegate math and unlikely path to the nomination, Governor John Kasich was not included in the issue stances.

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Overview:
Continued
Energy Policy
and Climate
Change
Trump Cruz Clinton Sanders
■■ Has stated that he
does not believe
in anthropogenic
climate change.
■■ “I am not a great
believer in man-
made climate
change.…I know
it’s probably a killer
with this room – but
I am not a believer.
Perhaps there’s ...
a minor effect, but
I’m not a big believer
in man-made climate
change.” (Trump,
The Washington Post,
3/22/16)
■■ Rejects claims that
scientific evidence
legitimizes climate
change.
■■ “The scientific
evidence doesn’t
support global
warming....Climate
change is the perfect
pseudoscientific
theory for a big
government
politician who wants
more power. Why?
Because it is a theory
that can never be
disproven.” (Cruz,
NPR, 12/9/2015)
■■ Stated opposition
to Keystone XL
Pipeline in September
2015 and has since
strengthened her
position by arguing
for a clean energy
future, urging the
U.S. to become a
world leader on
climate change and,
in February 2016,
calling a ban on fossil
fuel E&P on public
lands a “done deal.”
(Clinton, The Hill,
2/5/16)
■■ “I won’t let anyone…
deny our economy
the benefits of
harnessing a clean
energy future, or
force our children
to endure the
catastrophe that
would result from
unchecked climate
change.” (Clinton,
TIME, 11/29/15)
■■ Believes
anthropogenic
climate change is real
and already causing
devastating harm to
the planet.
■■ His climate change
plan includes a
tax on polluters
(corporations),
banning E&P in
the Arctic, ending
offshore drilling, and
stopping pipeline
projects like KXL.
■■ Has called
government
regulation a
“stealth tax that
is larger than the
amount the Internal
Revenue Service
collects each year
from corporations
and individuals
combined.” (Trump,
The Washington
Times, 2/7/12)
■■ Frames his opposition
to the size and power
of government in
categorical terms.
“We should shrink
the power of the
federal government
by every and any
means possible. What
does that mean? That
means eliminating
unnecessary or
unconstitutional
agencies.” (Cruz, 2016
Campaign Website)
■■ Has advocated for
a consumer- and
everyday investor-
first approach to
regulation.
■■ Believes that
regulators are
not sufficiently
empowered and lack
the tools they need
to fully protect the
economy.
■■ Believes government
regulation of
Wall Street is
compromised.
“The reality is that
Congress doesn’t
regulate Wall Street.
Wall Street, its
lobbyists and their
billions of dollars
[that] regulate
Congress. We must
change that reality,
and as president
I will.” (Sanders,
Speech on Wall Street
and the Economy,
New York, 1/5/16)
Government
Regulation

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Conclusion
The 2016 presidential election is already being billed as the most
expensive in history—total campaign spending could top more than $5
billion according to some estimates—but the value of its impact on U.S.
companies and multinationals operating in the U.S. could be much greater.
From the fate of corporate inversions to the future of energy and
climate change regulations, never before has so much ridden on the
outcome of a single vote.
The president sworn in on January 20, 2017, must be prepared to grapple
with terrorist threats at home and abroad, the effects of a warming planet,
and an unresolved immigration policy—all while preventing another Great
Recession and unifying a divided electorate.
© BRUNSWICK | 2016 | 9
Understandingthecurrentpoliticalstateofplay
intherun-uptoNovember8andpreparing
forthenewregulatorylandscapeunderthe
nextadministrationarecriticalimperativesfor
companiesoperatingintheUnitedStates.

10. 10 | 2016 | BRUNSWICK ©
For more information contact:
Brunswick Washington D.C.
Brunswick is the global leader in financial and
corporate communications, providing senior counsel
to clients around the globe on critical issues that
affect reputation, valuation, and business success.
David Sutphen
Office Head, Washington D.C.
Address:
1099 New York Ave., NW #300,
Washington, D.C. 20001
Tel: 1 202 393 7337
Email: DSutphen@brunswickgroup.com
Office Email: washingtonoffice@brunswickgroup.com
www.BrunswickGroup.com
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