Thread: Financial executives spent big on Brown

Financial executives spent big on Brown

May be precursor to midterm elections; Obama’s proposed regulations key issue

By Casey Ross
In a six-day span just before the US Senate election, Republican Scott Brown collected nearly $450,000 from donors who work at financial companies, a sign the industry is prepared to spend heavily in the upcoming midterm elections to beat back new controls and taxes President Obama wants to impose.

The donations, from hundreds of financial executives, far exceeded what Brown received from doctors and others in the health care industry in the final days of the campaign. While Brown saw donations from all quarters explode in mid-January, as polls showed him closing fast on opponent Martha Coakley, the donations from financial workers coincided with several key developments that would affect their companies.

On Jan. 14, five days before the Senate election, President Obama proposed a fee on large financial firms to recoup the cost of the government’s bailout of the industry, and he angrily demanded that those firms cut executive bonuses.

The president was also pushing the Senate to follow the House of Representatives and adopt sweeping changes that would impose controls on the trading of exotic securities, limit risk-taking by the largest institutions, and create an agency to protect consumers from abusive lending practices.

Martin Gruss, owner of a West Palm Beach, Fla., investment firm, said he gave $2,400 to Brown because he vehemently disagrees with the policies being pursued by Obama and his economic aides.

“They have no real understanding of the business implications of their actions,’’ he said, adding that limits on trading securities would undermine the position of the United States as the world’s financial capital. “I contributed to Scott Brown because his election will help redress the balance of power in the Senate.’’

The industry’s giving could also spell trouble for Democrats in next fall’s midterm elections, especially following the US Supreme Court decision last month that allows corporations to spend unlimited amounts to influence political contests.

Already, the financial services sector is the single largest base of donors to federal campaigns, giving an industry record $476 million in the 2007-2008 election cycle, much more than the second-largest giver, lawyers and lobbyists, who contributed $270 million, according to the Center for Responsive politics.

“People like me are scouring the country for conservative candidates,’’ said John Mumford, a California venture capitalist who gave the maximum $2,400 contribution to Brown four days before the election. “What’s going on in Washington is against everything I believe in, which is small government, balanced budgets, and support for free enterprise.’’

During the campaign, Brown generally opposed increased regulation of the financial industry, but did not address the bills pending in Congress.

In an interview last week, Brown said he is “all ears’’ on Obama’s proposal to limit risk-taking by financial institutions, but of the president’s call for a fee on the biggest banks, the new senator said, “we already have enough taxation.’’

Asked if he will be influenced by donations from financial executives, Brown said, “I’m not aware of who gave me what, ’cause I was just doing my job.’’

The Democratic-led overhaul bill, passed by the House in mid-December, is now before the Senate committee that handles financial matters. And as with Obama’s health care proposals, Brown’s election gives Senate Republicans the power to filibuster to stop the measure.

There remain several points of disagreement - Republicans say the consumer protection agency isn’t necessary because the government already has offices to protect consumers - but the parties continue to negotiate.

While Obama said he is heeding the message of discontent Massachusetts voters sent by electing Brown, he does not appear to be backing down on the issue of financial regulation. In his State of the Union address, Obama said financial institutions must be prevented from again taking risks “that threaten the whole economy.’’

“The House has already passed financial reform . . . and the lobbyists are already trying to kill it,’’ Obama said. “Well, we cannot let them win this fight. And if that bill ends up on my desk and does not meet the test of real reform, I will send it back.’’

The Financial Services Roundtable, one of the industry’s most influential groups in Washington, has been increasingly vocal in opposing the measure. The Roundtable raised $535,000 in the 2007-2008 election cycle and reported raising $242,000 through November 2009. But its chief lobbyist, Scott Talbott, said both donations and activity have picked up more recently.

“We’re seeing increased involvement overall, in terms of both interactions with members of Congress and through increased PAC contributions,’’ Talbott said.

In the Massachusetts race, Brown received about $442,000 from Jan. 11 through Jan. 16, while Coakley got $92,000 from financial industry workers during this period. Those figures are based on interim reports candidates must file to disclose donations of $1,000 or more within 20 days of an election. A more detailed accounting is not due until later in February.

Nonetheless, the fund-raising stands in marked contrast to last year’s, when Brown had yet to take a spot on the national stage and Coakley enjoyed the fund-raising advantage.

According to the Center for Responsive Politics, Brown collected $23,700 from employees of securities and investment firms through Dec. 31, while Coakley got $79,050.

Nearly 80 percent of the money Brown got from financial workers came from outside of Massachusetts, in places with a concentration of financial firms, such as New York City, Greenwich, Conn., Chicago, and San Francisco. In addition to financial giants such as Credit Suisse, Goldman Sachs, and Morgan Stanley, the donors included executives from hedge funds and private equity firms.

Richard Hillman, an analyst for First Wilshire Securities who lives in California, said he was following the Massachusetts election only casually, and decided to give to Brown at the last minute, when a friend told him the race was unexpectedly close. “I ended up giving money through my credit card that afternoon,’’ said Hillman, who contributed $2,400 on Jan. 16.

“Basically, I thought making him the 41st Republican vote in the Senate would prevent some really terrible legislation from getting through,’’ he said.

First of all corporations don't have any constitutional rights. Only individuals have constitutional rights. But corporations are allowed to buy elections because of supreme court decisions. Secondly, the U. S. does not have free elections. The elections are bought and paid for by giant corporations and the wealthy. They are the oligarchy. They are the real rulers of the U. S. Finally, while Brown might be on our side when it comes to illegal immigration he doesn't appear to be on our side when it comes to just about everything else. Anyone who opposes reform of the financial system, consumer protection, etc. is not a friend of the common people.

Nope, all we can hope for is to delay the inevitable slide into darkness. We are already waist deep, and the crocks are hungry. I would trust NO politician, because they will all be bought on Corporate money. Not even Ron Paul. Tancredo is the only trustworthy, and Pat Buchanan. Thats it.

But we will need these half-asses to keep the GD internet somewhat FREE for all people. Bill ORielly supports internet restrictions.

How long can we last?

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