Wall Street flexes its muscles


Wall Street is in a bind. Normally, the presidential election features two candidates who are both beholden to its interests and thus enables them to watch the process with complacency but this time the picture is a little confused.

On the Republican side there is Donald Trump who has, as usual, said a whole bunch of contradictory things that have left unclear where exactly he stands with respect to curbing the freedom of the big banks to risk wrecking the economy again. On the Democratic side, Hillary Clinton is undoubtedly friendly to them but the insurgent campaign of Bernie Sanders has tapped into a vein of populist anger against them that Clinton has to handle carefully if she is not to alienate the Sanders voters even more. So she has made a few gestures towards bank regulations that Wall Street no doubt thinks is just lip service.

But the rumors that she is considering Elizabeth Warren as a possible vice-president has alarmed them and they are sending out signals using anonymous sources that if Clinton does make that pick, they will abandon her.

Big Wall Street donors have a message for Hillary Clinton: Keep Elizabeth Warren off the ticket or risk losing millions of dollars in contributions.

In a dozen interviews, major Democratic donors in the financial services industry said they saw little chance that Clinton would pick the liberal firebrand as her vice presidential nominee. These donors despise Warren’s attacks on the financial industry. But they also think her selection would be damaging to the economy. And they warned that if Clinton surprises them and taps Warren, big donations from the industry could vanish.

“If Clinton picked Warren, her whole base on Wall Street would leave her,” said one top Democratic donor who has helped raise millions for Clinton. “They would literally just say, ‘We have no qualms with you moving left, we understand all the things you’ve had to do because of Bernie Sanders, but if you are going there with Warren, we just can’t trust you, you’ve killed it.’”

Most big donors don’t want Warren on the ticket because she is the most accomplished anti-Wall Street populist in the Democratic Party. But many also think her presence would drive a potential Clinton administration too far to the left, poison relations with the private sector from the start and ultimately be damaging to the economy.

The distaste for Warren in the banking industry is not surprising. No American politician in recent history has done more to harness the powerful anti-Wall Street sentiment that continues to rage in the country since the financial crisis of 2008.

Warren created the Consumer Financial Protection Bureau that many bankers dislike, and she continues to push for far stronger regulations including breaking up the nation’s largest financial institutions into smaller, simpler pieces. This is exactly the reason that many on the left, including ardent backers of Sen. Bernie Sanders’ presidential campaign, want to see Warren on the ticket.

This is clearly a pre-emptive move on their part. The big banks prefer to exercise their control over politicians quietly behind the scenes and it must be a bit galling for them to have their manipulations be out in the open like this.

Comments

  1. tueplo says

    I am not sure why Warren would want the position but I am surprised the bankers wouldn’t mind Warren as the VP. In the Senate she has been moderately influential to her colleagues and somewhat effective in altering legislation. Out of congress and tucked in what is often a largely ceremonial position with mostly only the VP’s bully pulpit (restrained by having to tow the official White House position) would be a boon to Wall Street.

  2. says

    “Damaging to the economy” = “will hurt our profits”. It’s interesting that no matter how well the “economy” is doing, it’s only doing well for a certain segment of the population. Yet people are buying it. The middle class never did better than when there were high taxes and strong unions. Now those very same people are raging against taxes and unions yet somehow expect to have the same (or better) standard of living as their parents and grandparents.

    The oligarchs have done a masterful job.

  3. DonDueed says

    A preemptive move, and I have no doubt it will be an effective one. I will be very surprised if Clinton tabs Warren for Veep, and even more surprised if Warren accepts. Veep is a lousy job, and Warren would be much more influential if she remained in the Senate.

  4. doublereed says

    I’ve always been surprised that democrats constantly advocate for Warren to stay in the Senate. I think this is short-sighted at best. The point is that having more visibility and influence for progressive politicians means that new progressive politicians can take their place. It’s like there’s only a set number of progressive politicians so you have to use them sparingly, instead of making more progressive politicians.

    Do I have to point out that people generally don’t consider Dick Cheney’s role to be “ceremonial”? Apparently this rule only applies to Democrats.

    imo it’s just more of Democrats trying to come up with reasons to lose. “Oh no, we don’t want progressives at Vice President. They should stay as a Senator.” FFS, it doesn’t take a genius to figure out that having a progressive Vice President would completely change the Democratic Party’s image and priorities.

  5. tueplo says

    “FFS, it doesn’t take a genius to figure out that having a progressive Vice President would completely change the Democratic Party’s image and priorities.”

    Well I’m certainly no genius but I could care less about the Dems image. Instead I look at the policies they actually fight for. Which is where having someone like Warren in the Senate makes the party actually appear to have something redeeming still within it. A Warren VP pick seems like window dressing to appease some Sanders supporters and a way, for what seems likely to be a very 1% friendly Clinton administration, to corral her influence in the Senate.
    But sure we can hope it would change their priorities.

  6. John Smith says

    She’s not actually vetting Warren – she’s just on the list to appease progressives.

  7. sonofrojblake says

    those very same people are raging against taxes and unions

    It’s the central schtick of the right to get poor people to believe that it’s very important that the economy is set up to help the rich, because this time next year Rodney we’ll be miwwionaires. That dream – that the poor will be rich real soon now – is the basic lie of the American economy since at least Reagan.

  8. says

    I would lose all respect for Warren if she ran with Clinton – it’d amount to joining the enemy for tactical advantage. I understand that that sometimes happens but I don’t like politicians that are a mass of unpleasant compromises. Since part of Warren’s appeal is her stance as a brave outsider, being Clinton’s VP would be a terribly cynical move in an already cynical campaign.

  9. says

    Have you noticed that every time the influence of money on politics comes up, it justifies everyone’s concern about the issue? When Wall St complains that they aren’t getting their money’s worth out of these politicians … Shit. We ought to be trying to figure out how to disempower these assholes not sitting around scratching our heads pretending “I wonder if there is quid pro quo going on?” The whole thing is a marketplace – it’s nothing but quid pro quo!

  10. lorn says

    While I’m a severe critic of the ‘both-sides’ meme there is some commonality between sides in that both are prone to flights of fancy, even though the form they take are completely different and where they come and go might as well be on different planets. Liberals tend to focus on figureheads and individuals. The whole hero arc, from hope and confidence that Obama would make it all right, to disappointment when he didn’t, has been a result of this. The president, the presidency, is just one slot in a machine. As we have seen the president, no matter how energetic and forceful, cannot force change on his own.

    Politics is a team sport. Without a supporting team the quarterback can’t get much done.

    To my mind the question is not how to put the Dream Team in the executive branch. Without some cooperation and teamwork in all branches progress isn’t going to happen. We have to advance on a broad front. If it means having progressives in congress or the senate a less perfect team in the executive is not just perfectly acceptable, it is likely more functional.

    Place Warren where she can do the most good, where she is.

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