N.Y. Rep. Carolyn Maloney vs. Reshma Saujani: Incumbent vs. Upstart

Earlier this month Grammy-winning John Legend headlined a private concert that pulled in nearly $100,000 for congressional hopeful Reshma Saujani, a name little known outside certain financial and Democratic political circles.

It was a nice haul for the hedge fund lawyer, presidential campaign worker and Ivy-educated daughter of the American Dream, whose Indian parents fled Idi Amin's Uganda in 1973 and landed in Chicago with $50, and her mother's wedding jewels hidden inside toothpaste tubes.

For her first-ever race, Saujani, 34, is mounting a Democratic primary challenge to nine-term Rep. Carolyn Maloney, 64, who came to New York in 1970 after college in her native North Carolina and has been in politics -- city, state, federal -- since about the time the young upstart was born.

In the 14th District, where Democrats outnumber Republicans 3-1, the Sept. 14 primary essentially is the election. The district covers the East Side of Manhattan and the western part of the borough of Queens.

It's not as though the two women are ideological opposites. "We are probably going to agree or vote the same on 80 or 90 percent of the issues," Saujani told a dozen would-be candidates last month at a Washington forum on running as a woman of color. That said, she is taking on Maloney without first seeking lesser office because "the last time I read the Constitution, it didn't say anything about waiting in line."

The fundraiser with Legend -- they met working on education reform issues -- was at the Upper East Side digs of hedge fund billionaire Marc Lasry and his wife, Cathy, Saujani's finance co-chair. It was a fitting venue for the candidate who defends Wall Street as New York's vital economic engine. Saujani contends the financial services sector ought not be hobbled by over-regulation or excessive taxation, especially by the feds, even in the era of voter anger over Wall Street abuses and bloated bonuses.

"What I love about Reshma is that she sees all the possibilities of what New York should be," Cathy lasry said. "She is the child of political refugees. . . . She looks at the future, she understands about bringing in new businesses, creating new jobs.

"She is not going to be machine-backed, and cast the 'right votes.' It's just not the same old, same old."

Besides, Lasry noted, "Reshma had the balls to go out there and [run against] Carolyn Maloney. There are tons of people who want that seat. They just don't have the balls to get it." (Actually two men -- Ryan Brumberg and Dino LaVerghetta, both 28 -- are duking it out for the virtually meaningless Republican nomination.)

Marie Wilson, president of the non-partisan White House Project, which offers leadership training to women, dismisses the argument by some feminists that Saujani should not oppose such a champion of women's rights.

"Men run against men all the time," said Wilson, speaking for herself, not the organization. "It has to become normal for women to run against women. Reshma has a different background, a different agenda. We have got to get a lot of young, diverse women stepping up to the plate."

Saujani is also getting political advice from at least one high-profile Republican: Diana Taylor, a former investment banker and state banking superintendent who happens to be Mayor Michael Bloomberg's longtime girlfriend and the object of overtures to seek office herself.

Political consultant and Maloney spokesman George Arzt is not impressed by Saujani. "She has no credentials," Arzt said. "She has no record in public service. She just moved into the district last summer. There is an old saying in politics: If they tell you what they are going to do, ask them to show you what they have done. She flunks that test."

Or as Maloney puts it: "Particularly in these challenging times, you need people who can get things done." (Translation: deliver millions or billions in federal money for medical care for ailing 9/11 workers, and for job-generating highway and subway projects,while tracking down constituents' Social Security checks and providing police departments with DNA rape kits.)

Saujani -- who holds a master's degree in public policy from Harvard and a Yale law degree -- campaigns as a community activist who took on racial prejudice in high school and who has done pro bono legal work on immigration. For this race she's been tapping valuable contacts made while working on Wall Street and for White House contenders Al Gore, John Kerry, Hillary Clinton and Barack Obama. (She amassed $1 million from South Asians for Kerry in 2004).

She assails Maloney for taking corporate PAC money from banking interests during the sub-prime mortgage frenzy, and for being part of the problem by not anticipating the economic implosion. Wall Street was not the only villain, Saujani said. Ratings agencies, lawmakers and consumers were also at fault. "We didn't have adequate regulation, so we are all to blame," she said.

Her own resume includes three hedge funds. One was Carret Asset Management, partly owned by major Democratic fundraiser Hassan Nemazee, who was charged with bank fraud last summer. Saujani left in 2006 and, like others working with him, says she saw no illegal activity there. (She notes that Maloney was among several lawmakers who got Nemazee campaign donations. Federal prosecutors asked Maloney and other recipients to turn over those contribuions: Maloney's campaign gave back the $4,000 total; an additional $1,500 was sent to a 9/11 charity.)

Saujani left two other hedge funds during the economic meltdown. Her first job out of law school included antitrust and securities fraud work for the law firm Davis, Polk & Wardwell. Unlike many members of Congress, she understands all aspects -- good and bad -- of the financial services sector.

Maloney calls Saujani a shill for that industry. At a May 26 Capitol Hill gathering of Cypriot- and Greek-Americans, she was introduced as the force behind the bill "to keep the credit card companies from ripping off" consumers. "It got me a huge primary financed by the banks because it will cost them $10 billion," she sniped to the group, without naming her opponent.

Saujani began organizing her run early last year even as Maloney mulled a primary challenge to interim Sen. Kirsten Gillibrand. But Sen. Chuck Schumer and others leaned on Maloney to spare the Democrats a bruising primary and instead exploit her House seniority on the Joint Economic, Financial Services, and Oversight and Government Reform committees.

Maloney stayed put. Saujani didn't blink. She was ready to rumble.


The 14th Congressional District

Some 249,000 registered Democrats live in the 14th. It spans the Upper East Side (where Maloney has lived for 40 years, currently in a fine old brownstone) to the Lower East Side and East Village (where Saujani rents an apartment). It also takes in Roosevelt Island and western Queens, including Astoria and Long Island City, home to increasing numbers of immigrants and young strivers.

It is affluent, predominantly white and heavily Jewish, but not without some diversity. Queens -- which accounts for a quarter of the voters -- was originally Italian and Greek, but newcomers include a rising number of South Asians, a particular Saujani target. Lower housing prices lure working-class voters and young families who can't afford Manhattan.

In a year when anti-incumbent sentiment is high, Saujani hopes for a stunning upset as the bright young outsider eager to reform education and immigration, and incubate new, clean, job-creating technologies and businesses in the district.

"In general around the country and in New York, it's a good time to challenge a generic incumbent," says New York political consultant Jerry Skurnik. "I am not sure it's a good time to challenge Carolyn Maloney. She has tended to handle the district well."

Saujanii notes that an effective media blitz could cost $1 million a week toward the end. New York is, after all, an extremely expensive media market. As of March 31, Maloney had $1.5 million in the bank to Saujani's $369,000. (The next filing deadline is in July). But the challenger raised a solid $804,000 since her Nov. 5 announcement, doubling Maloney's donations in the last quarter of 2009. In the first three months of 2010, the financial services sector contributed a third of Saujani's $400,000 total, according to the Wall Street Journal. Donors included officials from Goldman Sachs, JP Morgan and former Obama car czar Steven Rattner, who is battling allegations he was involved in a state pension fund scandal.

The Back Stories

The upbeat Saujani admits facing a steep learning curve. Maloney was able to lock up endorsements from Obama, Schumer and Gillibrand, whom the challenger calls a friend of 10 years. She says she didn't even get to ask for help from Emily's List, which funds pro-choice Democratic women and is backing Maloney. There have been small surprises, too. Saujani hardly expected a New York Observer reporter to describe exactly what she wore to a sweltering Sunday interview (black and white sleeveless dress, flip-flops, Dolce & Gabanna shades). Now she's never out of the standard working-woman "uniform," and is so busy campaigning that girlfriends sometimes shop for her clothes. Her social life consists of catching up with pals at political events.

There is a boyfriend, she confides, a very supportive, successful tech entrepreneur of Indian heritage whom she won't identify "to protect his privacy." But she doesn't think her ring-less finger matters. "If I were running anywhere else, it would be, 'You are 34. Why aren't you married?' " she said. "But the majority of women who vote [in the district] are single."

That solo cohort now includes Carolyn Maloney, who last September lost her husband of 33 years. Clifton Maloney, 71, an athletic marathon runner who made millions in real estate and investment banking, died in the Himalayas after climbing one of the world's highest peaks.

"He was our rock," Maloney said quietly. For much of her House career, he looked after their two girls in New York while their mother was in Washington. Christina, the first child born to a sitting City Council member, is a lawyer for a Washington non-profit; Virginia just graduated from Princeton. Since 2005, when Maloney gave up her rented flat and bought a four-level townhouse on Capitol Hill, she has shared a kind of Congressional sorority house with two rent-paying colleagues. She, Debbie Wasserman Schultz of South Florida and Melissa Bean of suburban Chicago, who represents Saujani's parents, have become great friends and confidantes over the years.

Saujani insists she's in this race to win, and thus become the first Indian-American woman in Congress. (California Democrat Dalip Singh Saund, elected in 1952, was the first man). But she is also a realist. "If we lose, we run again in the same race the next day," she told 50 young supporters at Washington's Eye Bar in mid-May. "If we lose, we will run again. And if we lose, we will run again."

With equal fervor, Maloney said, "I have never lost an election and I don't intend to start now."

Some New York pols suggest Maloney needs a decisive victory, if only to ward off a serious primary challenge in 2012. But Democratic City Council member Jessica Lappin -- who at 35 says Maloney is the reason she can bring her 3-year-old to work -- disagrees. "In these tough times, with all the anti-incumbent sentiment, even if she wins by one vote she'll still be sworn in next January," Lappin said. "A win is a win is a win."