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Wall Street Bails on Democrats: Midterm Candidates Claim It's a Plus

5 years ago
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A front-page story in the July 6 issue of The Washington Post revealed that campaign contributions to Democrats have dropped 65 percent over the past two years, led by a defection of big donors on Wall Street. Newsweek's Fareed Zakaria suggested Wall Street is growing restless under the rule of a president they suspect is "anti-business," and that it's showing in the Democrats' fundraising numbers.

At least half of the drop can be attributed to New York, where most of the nation's largest financial firms are based. In the 2008 election cycle, 28 percent of the Democratic campaign committee's individual contributions came from the New York area, which includes New Jersey and Long Island. Manhattan alone contributed 20 percent. In this election cycle, only 10 percent of the Democrats' cash has come from the New York area.

Some Democrats think the economic climate has negatively affected wealthy donors, while others say dissatisfaction with the Obama agenda has dampened the enthusiasm of rich liberals who typically give generously to Democrats. "There's something fundamental going on, which is a complete disaffection with the committees," one New York donor in the finance industry told the Post. "Progressives have been throwing up their arms," the fundraiser said, explaining progressive donors' belief that the campaign committees favor conservative candidates.

Still others believe that President Barack Obama has signaled that he is uninterested in catering to the rich. "'How do I take care of these people?' is just not the way he thinks," a well-known Washington Democrat told Politico. "He doesn't care about them, and it trickles down to the rest of the system." Obama has headlined only one event in New York this year, for the Democratic Congressional Campaign Committee, and has steered clear of the Hamptons, where the Clintons were famous for turning their social connections into Democratic cash.

The motives behind the cash slowdown are clearer for Wall Street firms. Large business are especially worried about the Obama administration's financial reform law, which passed last week without Republican support. Between health care reform, new financial regulations, and the possibility of cap-and-trade legislation, businesses say they have lawyers working night and day to keep up with the new expansions of federal authority. Most Wall Street chief executives supported Obama, but are beginning to feel the Democrats are betraying them by calling for so much new regulation.

"Almost every agency we deal with has announced some expansion of its authority, which naturally makes me concerned about what's in store for us for the future," one CEO told Zakaria.

Business lobbyists say the legislative issues that have come up over the past year are shaping their strategy for the midterm elections.

"We've seen significant votes lawmakers have taken that directly affect the business community, and we're certainly going to hold lawmakers accountable for those, whether it's health care, cap-and-trade, or financial reform," said J.P. Fielder, a spokesman for the U.S. Chamber of Commerce. "We're going to spend a lot of time and money educating voters on where their lawmakers stood on those votes. They were major issues, and it makes [the 2010 midterms] a significant election."

But despite the talk of worry over the sudden chill from Wall Street, Democratic party strategists say the numbers in key races suggest they are still in a strong position for the midterm elections. As of the end of the last quarter, the Democratic Senatorial Campaign Committee had out-raised its Republican equivalent by nearly $3 million and beaten its own numbers for the same period in the 2006 election cycle, when the Democrats were believed to be on the verge of taking over both the House and Senate.

In races Republicans are targeting in 2010, Democrats have a financial edge, even where they trail in the polls. In Nevada, Sen. Harry Reid has $9,134,241 on hand to GOP challenger Sharron Angle's $132,016. In California, Sen. Barbara Boxer has $9,676,293, compared with the $620,460 that Carly Fiornia, her Republican opponent, has in the bank. In Arkansas, Sen. Blanche Lincoln has about four times as much cash on hand as John Boozman, her GOP opponent.

Some liberal groups see the rift between Democrats and big finance as a boon to the party's narrative, helping them portray Republicans as the party of Wall Street. "In terms of the conversation with voters in this election, there is no question that contributions from Wall Street are an issue, and for Democratic candidates to be able to run without those contributions is a plus," Steve Rosenthal, the president of the Organizing Group, a D.C. consulting firm, told the Huffington Post.

Deirdre Murphy, national press secretary for the DSCC, said voters will notice the contrast between the parties' interactions with Wall Street. "Republicans didn't police Wall Street and now they're cashing in," Murphy told Politics Daily. "Democrats firmly believe we must prevent another financial collapse, and come November, voters will choose between a Republican Party that brazenly shills for the banks, or Democrats who fought hard to stand up for taxpayers and get the economy moving again."

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Rob & Kathy

Bailing out on the Democats? So are a lot of American voters...

July 07 2010 at 11:31 PM Report abuse +5 rate up rate down Reply

we need campaign finance reform and tax reform before anything else is reformed.

July 07 2010 at 10:03 PM Report abuse rate up rate down Reply

I would like to know what major drug and insurance company ceo's are saying. Also, does anyone know what happened to the 21% medicare cut that kicked in on June 1st as part of Obamacare? Was it tabled until next year? nobody is talking about this.

July 07 2010 at 8:57 PM Report abuse +4 rate up rate down Reply

that's funny---giving all that money to the banks was NOT wall street's bidding?

July 07 2010 at 9:17 AM Report abuse +6 rate up rate down Reply
1 reply to rsticks18's comment

I believe it was President Bush who gave all that money to the banks albeit with some democratic support.

July 07 2010 at 10:37 AM Report abuse -5 rate up rate down Reply

WALL STREET realizes that President Obama and the democrats will not do their bidding. So they will stick with the republicans who they have in their back pocket.

July 06 2010 at 10:09 PM Report abuse -10 rate up rate down Reply
Big Daddy

We've had 30 years of Reaganomics, and Alan Greenspans Laisse Faire economic policies, 8years of Bush/Cheney pro business govt. Why did business lay off 15 million workers? These pro business policies were in effect during the layoffs what else does business need? I guess if we left them alone they would hire us all back right? No, Wallstreet produces NOTHING of value, and they could care less for the people that do.

July 06 2010 at 9:56 PM Report abuse -10 rate up rate down Reply
1 reply to Big Daddy's comment

Big Daddy, you ask why business laid off 15 million workers. Then you start talking about Wallstreet. There are some major dummies on the boards. They may be under the impression from your statement and the article that ALL BUSINESS is part of Wallstreet, which is absolutely untrue. Wallstreet didn't kill as many jobs as manufacturing. When the housing and automobile industries tanked, all industries tanked as suppliers or beneficiaries of the income created. When houses and cars quit selling, that's when the banking industry or Wallstreet tanked. After Reagan's presidency, there was a push to force banks to make loans to people who couldn't afford them. That was what eventually turned into the realestate crash and the start of this horrible recession. Greenspan and Congress were actually more at fault than Wallstreet. They could've prevented it with common sense governing and higher interest rates in a booming market. We've had 20 years of stupid in Washington.

July 06 2010 at 10:46 PM Report abuse +6 rate up rate down Reply

Good for Wall Street. Good news for everyone but the Democrats.

July 06 2010 at 9:50 PM Report abuse +16 rate up rate down Reply

wall street's are opertunist gamblers if the tide turns back to dem they will be jumping ship from rep like the rats they are and beating the dems doors down to through money at them.hope that was cival enough.i never have yet seen one of mmy comments

July 06 2010 at 8:39 PM Report abuse -6 rate up rate down Reply

The general population has always thought that it was the Republicans that were most closely tied to Wall Street and that is was the Republicans that were going to cut their Social Security and Medicare. Now they should realize how ignorant they have been and how slick the Democrats are to have created the impression that they were the force against Wall Street. The Democrats still try to blame the Republicans ties to wall street and banks for the recession. Time to wise up.

July 06 2010 at 8:09 PM Report abuse +21 rate up rate down Reply

Having all the money doesn't guarantee the votes. Even in democrat circles. Look at the nobody Alvin Green in the South Carolina primary. He didn't even campaign and had pending charges against him. It just isn't fair how much money an incumbent can raise. If we vote incumbents out, the lobbyists may quit pumping money into their coffers only to see them lose.

July 06 2010 at 8:00 PM Report abuse +17 rate up rate down Reply

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