Mitt Romney’s “Cold-Blooded Brothers”: Wall Street Backs One Of Its Own
Bankers are supposed to be the personifications of economic reasoning, but anyone looking at the financial reports of the presidential candidates and super PACs that have come out this week might conclude that there’s more to their political calculations than dollars and cents. Indeed, what these reports fairly shout is that Wall Street’s political picks have been swayed by offended egos and tribalism.
Of course, there’s a straight dollars-and-cents rationale for the bankers’ flight from Barack Obama to Mitt Romney. Obama wants to raise taxes on the rich; Romney wants to lower them. But the sheer extent of Wall Street’s support for Romney suggests that there’s even more in play than that. As Sam Stein and Paul Blumenthal of the Huffington Post have documented, Goldman Sachs employees, who gave Obama more than a million bucks in his first White House run, gave Romney $106,000 in the final quarter of 2011 and Obama just $12,000. Citigroup’s bankers, who gave Obama $730,000 in 2008, gave him just $3,842 in the last three months of 2011, while lavishing $196,000 on Romney. At Blackstone Private Equity, whose chair, Steven Schwarzman, compared the administration’s (tepid) efforts to raise taxes on private-equity firms to Hitler’s invasion of Poland, employees gave Obama just $7,618 while Romney raked in $90,750.
By one measure—the current popularity of Wall Street—Romney picked a poor year to likely become the first presidential nominee to hail from finance. But precisely because Wall Street is (finally! rightly!) under attack as it has not been since the early 1930s, Wall Street is looking for its own political champion as well as economic guardian, and Romney certainly fits the bill. And because Wall Street—both its people and its companies—can donate more than ever before, thanks to Citizens United, Romney also picked a very good year to run: His brethren can give him more than they could in any previous election.
The extent of their Romney support—and, as a corollary, the narrowness of Romney’s funding base—really becomes clear in the financial reports of Romney’s super PAC, set up by his backers to fund all those negative commercials that Romney himself wouldn’t want to endorse. By the end of 2011, it had raised $30.2 million from just 265 donors. Ten million of that came from just ten donors, each contributing a million apiece. Of the eight donors who are identifiable, as a New York Times article by onetime Prospect writing fellow Nick Confessore and Michael Luo documented, six are hedge-fund or private-equity executives. With a base like that, what are the odds that a President Romney is going to scrap the carried interest tax break?
The financial sharpies aren’t just giving to Romney, of course. Texas leveraged-buyout-operator Harold Simmons, who provided most of the funding for the swift-boating of John Kerry in 2004, is back. Last year, he ponied up a cool $7 million for Karl Rove’s American Crossroads super PAC. And casino tycoon Sheldon Adelson and his wife have kept Newt Gingrich’s campaign afloat by showering $10 million on the pro-Newt super PAC.
The big money is mobilizing against Obama, and it would be a mistake to assume that Obama will be able to outspend Romney come next fall. In the final quarter of 2011, Romney and the Republican National Committee raised $93.4 million while Obama and the Democratic National Committee raised $68 million, according to a story in The Wall Street Journal.
For Mitt Romney, it is the best of times; it is the worst of times. The public really dislikes big-time bankers, big-time shadow bankers most of all. Meanwhile, big-time bankers, and big-time shadow bankers in particular, like Mitt Romney, their very own big-time shadow banker, and thanks to Citizens United are able to shovel him more money than ever before. He’s their blood and they are his—cold-blooded brothers to the end.
By: Harold Meyerson, The American Prospect, February 3, 2012
Rep. Cantor: Bought And Paid For By Wall Street Investors
Why has Rep. Eric Cantor (R-VA) been “increasingly concerned about the growing mobs occupying Wall Street,” while defending the Tea Party protests as an organic movement?” It’s all about the money.
Rep. Cantor’s campaign committee and leadership PAC have been bankrolled by Wall Street since he was elected in 2000. The financial industry has been his largest contributor, increasing donations to the congressman by 1,326% between the 2002 and 2010 election cycles.
So while Rep. Cantor may believe the Occupy Wall Street movement is “the pitting of Americans against Americans,” the reality is the movement is pitting Americans against his campaign contributors.
Then, of course, there is Rep. Cantor’s wife, Diana, a fixture on Wall Street. Ms. Cantor served as a VP at Goldman Sachs, a Managing Director at New York Private Bank & Trust, and currently is a partner at Alternative Investment Management, LLC – a firm that “invests mainly in hedge funds and private equity funds.”
According to Open Secrets
Thus far in the 2012 election cycle, Rep. Cantor is the second largest recipient of financial industry donations to House members.
In the 2010 election cycle, he was the third largest recipient of Wall Street cash. In fact, ever since his election to Congress, Rep. Cantor has been in the top 16 recipients of financial industry contributions.
Up to now in the 2012 election cycle, five of Rep. Cantor’s top 10 donors to his campaign committee and leadership PAC were in the financial industry.
Rep. Cantor is currently the second largest recipient of Securities and Investment contributions (which includes hedge funds, private equity and venture capital money).
During the 2010 election cycle, six of Rep. Cantor’s top 10 donors to his campaign committee and leadership PAC were from finance related industries.
During the 2010 election cycle he was the fourth largest recipient of Securities and Investment contributions.
By: PR Watch, Center for Media and Democracy, October 18, 2011
The Occupy Protests: A Timely Call For Justice
Occupy Wall Street and its kindred protests around the country are inept, incoherent and hopelessly quixotic. God, I love ’em.
I love every little thing about these gloriously amateurish sit-ins. I love that they are spontaneous, leaderless and open-ended. I love that the protesters refuse to issue specific demands beyond a forceful call for economic justice. I also love that in Chicago — uniquely, thus far — demonstrators have ignored the rule about vagueness and are being ultra-specific about their goals. I love that there are no rules, just tendencies.
I love that when Occupy Wall Street was denied permission to use bullhorns, demonstrators came up with an alternative straight out of Monty Python, or maybe “The Flintstones”: Have everyone within earshot repeat a speaker’s words, verbatim and in unison, so the whole crowd can hear. It works — and sounds tremendously silly. Protest movements that grow into something important tend to have a sense of humor.
I can’t help but love that House Majority Leader Eric Cantor called the protests “growing mobs” and complained about fellow travelers who “have actually condoned the pitting of Americans against Americans.” This would be the same Eric Cantor who praised the Tea Party movement in its raucous, confrontational, foaming-at-the-mouth infancy as “an organic movement” that was “about the people.” The man’s hypocrisy belongs in the Smithsonian.
Most of all, I love that the Occupy protests arise at just the right moment and are aimed at just the right target. This could be the start of something big and important.
“Economic justice” may mean different things to different people, but it’s not an empty phrase. It captures the sense that somehow, when we weren’t looking, the concept of fairness was deleted from our economic system — and our political lexicon. Economic injustice became the norm.
Revolutionary advances in technology and globalization are the forces most responsible for the hollowing-out of the American economy. But our policymakers responded in ways that tended to accentuate, rather than ameliorate, the most damaging effects of these worldwide trends.
The result is clear: a nation where the rich have become the mega-rich while the middle class has steadily lost ground, where unemployment is stuck at levels once considered unbearable, and where our political system is too dysfunctional to take the kind of bold action that would make a real difference. Eventually, the economy will limp out of this slump, and things will seem better. Fundamentally, however, nothing will have changed.
Does that sound broad and unfocused? Yes, but it’s true.
The Occupy Wall Street protesters saw this broad, unfocused truth — and also understood that the place to begin this movement was at the epicenter of the financial system.
For most of our history, it was understood that the financial sector was supposed to perform a vital service for the economy: channeling capital to the companies where it could be most effectively used. But the rapid technological, economic and political change the world has witnessed in recent decades created myriad opportunities for Wall Street to channel capital to itself, often by inventing exotic new securities whose underpinnings may not exist. The 2008 financial crisis demonstrated the urgent need for reform.
It’s not that investment bankers should be held responsible for all the ills of the world. It’s that Wall Street is emblematic of an entire economic and political system that no longer seems to have the best interests of most Americans at heart.
So a ragtag group — not huge, but idealistic and determined — camps out in Lower Manhattan. A similar thing happens in two dozen other cities. And maybe a movement is born.
Already, after less than a month, commentators are asking whether the Occupy protests can be transformed into a coherent political force. For now, at least, I hope not.
We have no shortage of politicians in this country. What we need is more passion and energy in the service of justice. We need to be forced to answer questions that sound simplistic or naive — questions about ethics and values. Detailed policy positions can wait.
At some point, these protest encampments will disappear — and, since the nation and the world will not have changed, they’ll be judged a failure. But I’ve got a hunch that this likely judgment will be wrong. I think the seed of progressive activism in the Occupy protests may grow into something very big indeed.
By: Eugene Robinson, Opinion Writer, The Washington Post, October 10, 2011
“Economic Royalists”: The Panic Of The Plutocrats
It remains to be seen whether the Occupy Wall Street protests will change America’s direction. Yet the protests have already elicited a remarkably hysterical reaction from Wall Street, the super-rich in general, and politicians and pundits who reliably serve the interests of the wealthiest hundredth of a percent.
And this reaction tells you something important — namely, that the extremists threatening American values are what F.D.R. called “economic royalists,” not the people camping in Zuccotti Park.
Consider first how Republican politicians have portrayed the modest-sized if growing demonstrations, which have involved some confrontations with the police — confrontations that seem to have involved a lot of police overreaction — but nothing one could call a riot. And there has in fact been nothing so far to match the behavior of Tea Party crowds in the summer of 2009.
Nonetheless, Eric Cantor, the House majority leader, has denounced “mobs” and “the pitting of Americans against Americans.” The G.O.P. presidential candidates have weighed in, with Mitt Romney accusing the protesters of waging “class warfare,” while Herman Cain calls them “anti-American.” My favorite, however, is Senator Rand Paul, who for some reason worries that the protesters will start seizing iPads, because they believe rich people don’t deserve to have them.
Michael Bloomberg, New York’s mayor and a financial-industry titan in his own right, was a bit more moderate, but still accused the protesters of trying to “take the jobs away from people working in this city,” a statement that bears no resemblance to the movement’s actual goals.
And if you were listening to talking heads on CNBC, you learned that the protesters “let their freak flags fly,” and are “aligned with Lenin.”
The way to understand all of this is to realize that it’s part of a broader syndrome, in which wealthy Americans who benefit hugely from a system rigged in their favor react with hysteria to anyone who points out just how rigged the system is.
Last year, you may recall, a number of financial-industry barons went wild over very mild criticism from President Obama. They denounced Mr. Obama as being almost a socialist for endorsing the so-called Volcker rule, which would simply prohibit banks backed by federal guarantees from engaging in risky speculation. And as for their reaction to proposals to close a loophole that lets some of them pay remarkably low taxes — well, Stephen Schwarzman, chairman of the Blackstone Group, compared it to Hitler’s invasion of Poland.
And then there’s the campaign of character assassination against Elizabeth Warren, the financial reformer now running for the Senate in Massachusetts. Not long ago a YouTube video of Ms. Warren making an eloquent, down-to-earth case for taxes on the rich went viral. Nothing about what she said was radical — it was no more than a modern riff on Oliver Wendell Holmes’s famous dictum that “Taxes are what we pay for civilized society.”
But listening to the reliable defenders of the wealthy, you’d think that Ms. Warren was the second coming of Leon Trotsky. George Will declared that she has a “collectivist agenda,” that she believes that “individualism is a chimera.” And Rush Limbaugh called her “a parasite who hates her host. Willing to destroy the host while she sucks the life out of it.”
What’s going on here? The answer, surely, is that Wall Street’s Masters of the Universe realize, deep down, how morally indefensible their position is. They’re not John Galt; they’re not even Steve Jobs. They’re people who got rich by peddling complex financial schemes that, far from delivering clear benefits to the American people, helped push us into a crisis whose aftereffects continue to blight the lives of tens of millions of their fellow citizens.
Yet they have paid no price. Their institutions were bailed out by taxpayers, with few strings attached. They continue to benefit from explicit and implicit federal guarantees — basically, they’re still in a game of heads they win, tails taxpayers lose. And they benefit from tax loopholes that in many cases have people with multimillion-dollar incomes paying lower rates than middle-class families.
This special treatment can’t bear close scrutiny — and therefore, as they see it, there must be no close scrutiny. Anyone who points out the obvious, no matter how calmly and moderately, must be demonized and driven from the stage. In fact, the more reasonable and moderate a critic sounds, the more urgently he or she must be demonized, hence the frantic sliming of Elizabeth Warren.
So who’s really being un-American here? Not the protesters, who are simply trying to get their voices heard. No, the real extremists here are America’s oligarchs, who want to suppress any criticism of the sources of their wealth.
By: Paul Krugman, Op-Ed Columnist, The New York Times, October 9, 2011
The Grand Delusion: Higher Taxes “Soak” The Rich
Squeezing, gouging, soaking, it’s all the same, and it’s all wrong. The richest Americans, we hear it said, pay most of the federal income taxes. That’s true. But since 1980 their AFTER-TAX SHARE of America’s income has TRIPLED. That’s a trillion dollars a year in extra income for the wealthiest 1%.
A trillion dollars is seven times more than the budget deficits of all 50 states combined.
A trillion dollars, if it hadn’t been redistributed to the rich, would provide an extra $10,000 a year for every family that has contributed to American productivity since 1980.
The defenders of unlimited wealth insist that the very rich have earned their money. But what does EARN mean? Does it mean that the million richest families worked harder than the other 99 million families for thirty years? Does it mean that one man can bet against the mortgage industry and make enough money to pay the salaries of 100,000 health care workers? Does it mean using American research and infrastructure and national security to build a corporation that pays zero federal income taxes?
Most of the fortunate 1% benefited from tax cuts, financial system de-regulation, ownership of 50% of the stock market, and a 15% capital gains tax. According to a study by the University of California, in 2008 only 19% of the income reported by the 13,480 individuals or families making over $10 million came from wages and salaries.
The very rich claim that their income growth stimulates the economy. But it hasn’t happened. Low-income earners spend a greater percentage of their overall income on consumption, but they have less purchasing power than they had thirty years ago.
What the very rich won’t admit is that they benefit the most from government-funded research, national security, infrastructure, property rights, and a financial industry tailored to their pleasure and profit.
Instead, they claim that anyone can be rich if only they work hard. Much of America wouldn’t know if this is true. They haven’t had a chance to work lately.
By: Paul Buchheit, CommonDreams.org, May 10, 2011
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