Bailout re­cip­i­ents keep do­nat­ing to politi­cians

The Washington Times Weekly - - Politics - BY JEN­NIFER HABERKORN

Wall Street ex­ec­u­tives have pleaded eco­nomic ruin, se­cured hun­dreds of bil­lions of dol­lars in tax­payer as­sis­tance and been pil­lo­ried for their busi­ness ex­cesses. But none of that has curbed their ap­petite for dol­ing out po­lit­i­cal do­na­tions — or the will­ing­ness of politi­cians to ac­cept the largesse.

A Wash­ing­ton Times anal­y­sis found that ex­ec­u­tives and em­ployee-funded po­lit­i­cal action com­mit­tees of bank­ing com­pa­nies that re­ceived bailout money have do­nated more than $2 mil­lion to mem­bers of Congress and other politi­cians since law­mak­ers ap­proved the fed­eral res­cue of Amer­ica’s fi­nan­cial sys­tem in Oc­to­ber.

The PACs linked to the top 20 re­cip­i­ents of fed­eral res­cue funds have spent a com­bined $1.5 mil­lion on do­na­tions since Congress ap­proved the bailout while em­ploy­ees of the top 10 re­cip­i­ents of bailout money have do­nated an ad­di­tional $726,070, Fed­eral Elec­tion Com­mis­sion records showed.

The fi­nan­cial in­dus­try has long been a dom­i­nant po­lit­i­cal giver. For in­stance, ex­ec­u­tives of the top 10 bailout re­cip­i­ents gave $1.2 mil­lion in do­na­tions dur­ing the same pe­riod in 2004.

But their con­tin­ued largesse since the bailout is a stark re­minder that its ex­ec­u­tives still in­tend to play ex­pen­sive pol­i­tics even in the midst of a belt-tight­en­ing re­ces­sion, an­a­lysts said.

“Tax­pay­ers hope their money is be­ing al­lo­cated en­tirely on the mer- its, but with Congress con­trol­ling how much money the Trea­sury gets to hand out, it will be im­pos­si­ble to com­pletely ex­clude pol­i­tics from this process,” said Sheila Krumholz, ex­ec­u­tive di­rec­tor of the Cen­ter for Re­spon­sive Pol­i­tics, a non­par­ti­san group that stud­ies po­lit­i­cal giv­ing.

Law­mak­ers said the fed­eral bailout pro­gram, which was passed Oct. 3, would help banks keep credit mov­ing in the mar­ket to help Amer­i­cans buy homes and cars.

But within weeks, money also was mov­ing into their cam­paign ac- counts.

JPMor­gan’s em­ployee PAC, for in­stance, has is­sued $275,552 in po­lit­i­cal do­na­tions since Oct. 16, in­clud­ing $91,000 spent three weeks af­ter the bailout was ap­proved.

Wells Fargo & Co.’s em­ployee PAC has ap­proved $211,400 in po­lit­i­cal do­na­tions. Bank of Amer­ica’s PAC is­sued an­other $304,265.

Banks stress that nei­ther cor­po­rate money nor fed­eral funds — dis­trib­uted un­der the Trou­bled As­sets Re­lief Pro­gram (TARP) — are used in PACs.

“Through our vol­un­tary team mem­ber-funded po­lit­i­cal action com­mit­tees — not through cor­po­rate dol­lars — Wells Fargo makes con­tri­bu­tions to candidates who un­der­stand the needs of our com­pany, team mem­bers, cus­tomers and com­mu­ni­ties,” Wells Fargo spokes­woman Ju­lia Tu­nis Bernard said in an e-mail.

PACs are made up largely of em­ployee con­tri­bu­tions, and de­ci­sions about who re­ceives a do­na­tion typ­i­cally are made by a com­mit­tee of em­ploy­ees.

“We don’t use TARP funds for lob­by­ing or po­lit­i­cal con­tri­bu­tions,” Bank of Amer­ica spokes­woman Shirley Nor­ton said. “We’re very sen­si­tive to the fact we have tax­payer money.”

Mem­bers of Congress, some of whom have de­rided the banks for friv­o­lous spending in the mid­dle of the mas­sive credit cri­sis, have re­ceived a ma­jor­ity of the cam­paign cash, ac­cord­ing to a re­view of the FEC doc­u­ments.

Rep. Shel­ley Moore Capito, West Vir­ginia Repub­li­can, col­lected a com­bined $10,000 from the PACs of Bank of Amer­ica, Wells Fargo and Gold­man Sachs in Oc­to­ber. She had voted against the bailout that month.

Rep. David Scott, Ge­or­gia Demo­crat, col­lected $9,500 from the PACs of Wells Fargo, JPMor­gan and Gold­man Sachs dur­ing Oc­to­ber. He voted for the bailout.

Rep. Bar­ney Frank, Mas­sachusetts Demo­crat and chair­man of the House Fi­nan­cial Ser­vices Com­mit­tee, col­lected $9,500 from Wells Fargo and Gold­man Sachs PACs in the month af­ter the bailout was ap­proved.

Michael An­del, Mr. Scott’s chief of staff, said the con­gress­man was fo­cused on get­ting mort­gage re­lief passed, not nec­es­sar­ily aid­ing the banks.

“Banks and credit unions like Con­gress­man Scott, but they fight all the time,” Mr. An­del said. “He has been sup­port­ive of ef­forts that bring strong over­sight to TARP fund­ing.”

The Trea­sury Depart­ment con­trols how and to whom the money is dis­trib­uted, but Congress ini­tially had to ap­prove the pro­gram.


House Fi­nan­cial Ser­vices Com­mit­tee Chair­man Bar­ney Frank, Mas­sachusetts Demo­crat, has been lead­ing ef­for ts on Capi­tol Hill to en­act leg­is­la­tion to sta­bi­lize the econ­omy. He col­lected $9,500 from Wells Fargo and Gold­man Sachs PACs in the month af­ter...

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