Lib­er­als wary of Clin­ton’s anti-Wall Street stance

San­ders ads blast big banks’ do­na­tions

The Washington Times Weekly - - Politics - BY KELLY RIDDELL

Demo­cratic pres­i­den­tial front-run­ner Hil­lary Rod­ham Clin­ton’s pop­ulist anti-Wall Street pitch is wear­ing thin with lib­eral activists who say her fi­nan­cial re­form pro­pos­als are too weak and her record is too tainted by mil­lions of dol­lars in cam­paign con­tri­bu­tions from the fi­nan­cial sec­tor.

Af­ter col­lect­ing $17 mil­lion in do­na­tions from big banks over the years, Mrs. Clin­ton is at risk of be­ing seen as too cozy with Wall Street — an im­age Sen. Bernard San­ders, her chief com­peti­tor for the Demo­cratic nom­i­na­tion, is hop­ing to cap­i­tal­ize on.

He’s run­ning ads in Iowa and New Hamp­shire, home of the first cau­cuses and pri­maries, warn­ing vot­ers: “The truth is, you can’t change a cor­rupt sys­tem by tak­ing its money.”

Mrs. Clin­ton was in­dig­nant at the charges at the last Demo­cratic de­bate, cit­ing the 9/11 ter­ror­ist at­tacks in say­ing Mr. San­ders im­pugned her in­tegrity by suggest­ing her fi­nan­cial re­forms were weak be­cause of her cam­paign do­na­tions.

But activists said Mr. San­ders was onto some­thing.

“First of all, Bernie San­ders did not im­pugn her in­tegrity by point­ing out her ac­tion. Her own ac­tions im­pugn her in­tegrity,” Deb­bie Lusig­nan, a lib­eral ac­tivist, said on her YouTube show, “Sane Pro­gres­sive,” af­ter the de­bate.

“When you take tens of mil­lions of dol­lars from Wall Street, the big banks … when you get that money and then you help to cre­ate the Trans-Pa­cific Part­ner­ship, which enor­mously ben­e­fits Wall Street through back­door dereg­u­la­tions … you im­pugn your own in­tegrity through those ac­tions,” she said.

The chief bat­tle­ground is Glass-Stea­gall, a De­pres­sion-era law that pro­hib­ited com­mer­cial banks from en­gag­ing in the in­vest­ment busi­ness. Glass-Stea­gall was re­pealed by Pres­i­dent Bill Clin­ton, and many an­a­lysts ar­gue that paved the way for the 2008 fi­nan­cial cri­sis.

Mr. San­ders and for­mer Mary­land Gov. Martin O’Malley, the other ma­jor Demo­cratic can­di­date, have called for re­in­stat­ing Glass-Stea­gall rules. But Mrs. Clin­ton says that’s not needed, and in­stead has called for more lim­ited re­forms that ex­perts say would leave Wall Street’s struc­ture largely in­tact.

Her pro­pos­als, an­nounced in Oc­to­ber, in­clude en­abling reg­u­la­tors to break up banks “if they need to be bro­ken up,” im­pos­ing risk fees and call­ing for fines and po­ten­tial crim­i­nal pros­e­cu­tions for in­dus­try ex­ec­u­tives ac­cused of wrong­do­ing. Bank­ing an­a­lysts praised her ap­proach. “We con­tinue to be­lieve Clin­ton would be one of the bet­ter can­di­dates for fi­nan­cial firms, as she is push­ing con­crete re­forms where one can understand the down­side risk rather than more rad­i­cal over­hauls,” Jaret Seiberg, a Guggen­heim Part­ners an­a­lyst, said in a note to clients an­a­lyz­ing Mrs. Clin­ton’s plan.

But some pro­gres­sive activists said Mrs. Clin­ton only in­tro­duced her re­forms to try to fend off at­tacks from Mr. San­ders, and ques­tioned her com­mit­ment to any Wall Street changes.

“Peo­ple’s be­liefs are deeply in­flu­enced by their fi­nan­cial re­wards and their needs, and she’s been a lead­ing re­cip­i­ent of Wall Street’s money per­son­ally, in terms of speech fees and po­lit­i­cally all through her ca­reer,” said Robert Borosage, the pres­i­dent of Cam­paign for Amer­ica’s Fu­ture, a lib­eral ad­vo­cacy group. “It’s not an accident she gets a lot of money from Wall Street. They have trust she will not do re­forms that will dra­mat­i­cally change their sit­u­a­tion.”

So far this elec­tion cy­cle, Mrs. Clin­ton’s cam­paign has col­lected $5.5 mil­lion from the bank­ing sec­tor, the most of any pres­i­den­tial can­di­date, Repub­li­can or Demo­crat.

In ad­di­tion, records show Mrs. Clin­ton has raised $3.2 mil­lion from reg­is­tered lob­by­ists, al­most four times more than the en­tire Repub­li­can field com­bined. Those lob­by­ists rep­re­sent the in­ter­ests of big banks and the oil and phar­ma­ceu­ti­cal in­dus­tries.

But her Wall Street ties go much fur­ther back. Cit­i­group was the top cam­paign con­trib­u­tor to her 2000 Se­nate run, and by the time that race had con­cluded, Mrs. Clin­ton had re­ceived more Wall Street sup­port than any of her fel­low 99 sen­a­tors had re­ceived for their re­spec­tive elec­tions.

And since 2001, she and her hus­band, for­mer Pres­i­dent Bill Clin­ton, have col­lected at least $35 mil­lion for 164 paid speeches to fi­nan­cial ser­vices, real es­tate and in­sur­ance com­pa­nies, ac­cord­ing to an As­so­ci­ated Press anal­y­sis of pub­lic dis­clo­sure forms and records re­leased by her cam­paign.

As a se­na­tor she voted for the bank­ing lobby’s top pri­or­ity, the Bank­ruptcy Re­form Act of 2001. The leg­is­la­tion made it more dif­fi­cult for in­di­vid­u­als to erase their per­sonal debts through bank­ruptcy.

That bill died in Congress, but a later version in 2005 be­came law. Mrs. Clin­ton missed that vote, and al­though she said she would have op­posed it, her ab­sence drew the crit­i­cism of Sen. El­iz­a­beth War­ren, a Mas­sachusetts Demo­crat who has be­come a lead­ing lib­eral voice.

That same year the Se­nate Bank­ing Com­mit­tee voted out com­pre­hen­sive leg­is­la­tion to tighten the reg­u­la­tion of mort­gage gi­ants Fan­nie Mae and Fred­die Mac. At the time the in­sti­tu­tions were ramp­ing up their buy­ing of sub­prime mort­gages, giv­ing fuel to the fi­nan­cial bub­ble. Mrs. Clin­ton joined a fil­i­buster, and the bill never got a vote in the Se­nate.

Mrs. Clin­ton took in $2.1 mil­lion from the se­cu­ri­ties and in­vest­ment in­dus­try in her 2006 re-elec­tion cam­paign — more than the top three Repub­li­cans com­bined.

She voted for bailouts of the hous­ing mar­ket, AIG and Fan­nie Mae, and also sup­ported the Trou­bled As­set Re­lief Pro­gram, or TARP.


Lib­eral pun­dits are an­gry Hil­lary Rod­ham Clin­ton pub­licly flogs the fi­nan­cial sec­tor while at the same time ac­cept­ing mil­lions from it in cam­paign cash.

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