Thursday, March 27, 2008

Obama Attacks Wall Street While Taking Their Money

I am trying to be an equal opportunity offender, so here is a reasonable challenge to Senator Barack Obama that I found on the NPR News Blog. Speak truth to power...



Senator Obama's speech today outlined his differences with the other presidential candidates regarding the crisis on Wall Street. But it also highlighted the degree to which all three major candidates are involved with Wall Street.

In assigning blame for the subprime mortgage collapse, as well as for other financial woes, Obama went further than either his Democratic rival, Hillary Clinton, or Republican John McCain.

He spread the blame around... but largely in Washington. He said both Democrats and Republicans, quote, let the special interests put their thumbs on the economic scales.

"The future cannot be shaped by the best-connected lobbyists with the best record of raising money for campaigns. This thinking is wrong for the financial sector and it's wrong for our country."

"Obama is now the number one recipient of securities and investment money among the presidential candidates," says Sheila Krumholz, director of the Center for Responsive Politics. She says the center's analysis of campaign finance data shows that Obama has raised 6.7 million dollars from people and political action committees in the securities and investment industry.

Hillary Clinton is right behind him, at 6 point 6 million. McCain trails the Democrats, at about 3 million.

This just might explain why none of them -- most notably Obama or Clinton -- has been beating the drum for punishing investment firms, or their executives, for their roles in this financial mess.

Bashing Wall Street was once a fine tradition in the Democratic party. At the 1936 nominating convention, President Franklin Roosevelt lit into business and financial monopoly, speculation, reckless banking, and a few others.

"They are unanimous in their hate for me. And I welcome their hatred," said Roosevelt.

The kind of thing a Democrat would say 72 years ago, but not today.

Earlier this week, Clinton offered her solutions for the housing crisis. She urged that Washington should help homeowners just as much as it helps Wall Street. "We've seen unprecedented action to maintain confidence in our credit markets and head off a crisis for Wall Street banks. It's now time for equally aggressive action to help families avoid foreclosure."

On Tuesday, Republican McCain weighed in. He said that no assistance should be given to speculators. But he was talking about home buyers, not the folks who sold them the mortgages. For the industry, McCain said, government aid should be based only on heading off major systemic risks in the future.

At the Center for Responsive Politics, Krumholz says that in recent history, Wall Street has been careful to go with the winner -- Congressional Republicans in the late 1990s. President Bush in 2000 and 2004. And now she says, "The securities and investment industry, & specifically the more aggressive players, the hedge funds & the private equity funds, are leaning more to the left than they have in the past, & the hedge funds and private equity, the more aggressive players, are leaning more to the left than the industry as a whole."

And Democrats are happy to be leaned on.

Just after his speech this morning, Obama's schedule included a fundraising lunch at the Manhattan offices of Credit Suisse, the multi-national investment bank. Seats were priced from 1 thousand dollars to 23 hundred dollars. The lunch has long been sold out.

-- Peter Overby

5:25 PM ET | 03-27-2008 | permalink

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