Sixteen years ago, when Bill Clinton was moving into the White House, good-government liberals were disheartened that the President-elect named his campaign’s top fundraiser, Rahm Emanuel, as White House political director. They
read this as a sign that cash would be king in the Clinton Administration. They
Four elections later, after getting rich in a brief stint in finance, Emanuel is the favorite congressman of Wall Street, measuring by campaign contributions. In the midst of a financial crisis that President-elect Barack Obama blames on Wall Street’s greed and excessive influence in Washington, Emanuel is once again headed to a perch of power in a Democratic White House, this time as chief of staff.
Obama hasn’t been in Washington for very long, and much of his tenure in the U.S. Senate has been spent barnstorming in Iowa, Colorado, and Indiana. In response to concerns that Obama lacks experience and doesn’t know his way around Washington, the Democrat’s supporters argued that he would surround himself with smart, knowledgeable people who know how the town works.
Emanuel certainly has been around the block.
Aside from his time in the trenches of Democratic machine politics in Cook County,
Illinois, where he was Mayor Richard Daley’s money man, Emanuel also served as a
fundraiser and operative in the Clinton administration. Neither of these items
on his résumé quite smells like clean government.
Considering Obama’s promises to stand up for Main Street and take on Wall Street, Emanuel’s deep ties with Wall Street are noteworthy. Emanuel was a chief advocate of the $700 billion Wall Street bailout this fall, toiling to pass it through the House
after it was first rejected.
Just as Emanuel has helped Wall Street, Wall Street has helped Emanuel. This past election cycle, more than a third of Emanuel’s campaign contributions from political action committees came from financial sector PACs.
His top source of campaign funds this year was the subprime-rattled UBS (the Swiss bank’s PAC and employees gave, corporations cannot give campaign contributions), who benefited from the housing bailout which Emanuel supported and has already shown an interest in expanding.
Hedge funds and private equity firms are also close with Emanuel. Over his career,
Emanuel’s best source of funds has been the private equity firm Madison Dearborn
Partners. Hedge funds, facing a new slew of regulations, handouts, and rules,
dramatically increased their contributions this year, and Emanuel was also their
favorite House member.
The $96,900 Emanuel pulled in from hedge funds places him above any Senator besides presidential candidates. In fact, Emanuel garnered from hedge funds more than the top 11 Republican lawmakers, combined.
Goldman Sachs and JP Morgan are also in Emanuel’s top-five career sources of campaign cash. As reported by the Center for Responsive Politics, Emanuel received more money from the securities and investment industry—$600,500 as of September 30—than did any other member of the U.S. House, and more than two presidential candidates (including Joe Biden) and the chairman of the Senate Finance
Commercial banks lined Emanuel’s pockets, too, with $121,100, placing him fourth among House members.
Remember, too, that all of these industries that have favored Obama’s next chief of staff so well also gave more to Obama than to McCain. And while Obama studiously rejected lobbyist contributions to his campaign, Emanuel had no such scruples.
In money from lobbyists, Emanuel was in the top 10% of House members, which is made more interesting by the fact he didn’t face a competitive reelection at all in his
solidly Democratic House district.
What does it portend for an Obama administration that his closest advisor would be someone so steeped in fundraising and so close to Wall Street?
Back in 1993, Fred Wertheimer lamented fundraiser Emanuel’s top spot in the Clinton White House, calling it “a very dangerous appointment for the Clinton administration because it places in the White House an individual whose principal responsibility has been to raise huge sums of money from special interests seeking influence over government decisions.”
Indeed, Emanuel had been crucial in steering Wall Street money into Clinton’s campaign. His record suggests he will the financial industry’s man inside the Obama White House. At a time when the Washington-Wall Street relationship is changing rapidly, will Emanuel be the man to guarantee it’s change the Wall Street firms need?
In response to: Too big to fail. Or to pay taxes. Or to be identified.