What Goes Around, Comes Around

Since Senate Republicans announced their intention to filibuster a financial reform bill, their party has come under attack from the left for supposedly being in the pocket of big banks. Even the president suggested this weekend that the GOP is taking its cues from Wall Street. The Democrats may have difficulty understanding that some lawmakers oppose an overhaul of the financial sector that would dramatically increase “oversight” and controls on principal but they should have a look at their own glass house before throwing more stones.

The common argument runs that the Republicans are solely devoted to protecting the interests of their foremost party contributors. President Barack Obama described them as Wall Street’s “allies in Washington” on Saturday while congressional Democrats have lambasted their opposite numbers for blocking what they describe as essential and “common sense” reform.

Both major parties take donations from Wall Street and typically, banks and their employees are split equally between Democratic and Republican candidates, which makes for a safe bet. Things were slightly off during the last election however.

Employees of Goldman Sachs, Citigroup and JPMorgan Chase were among Barack Obama’s greatest campaign contributors in 2008, coughing up total amounts of $994,795, $701,290 and $695,132 respectively to help elect the then-senator.

Goldman Sachs, which recently came under investigation by the Securities and Exchange Commission for allegations of fraud, has always leaned more to the Democratic Party, preferring the left around margins of 60 percent throughout the last twenty years. 2008 was no ordinary year however. So much as 75 percent of donations from Goldman Sachs went to Democrats, totaling $4,463,788.

Similar trends were noticeable with Citigroup and JPMorgan Chase. While neither firm typically shows a clear political preference, in 2008, both spent over 60 percent of their donations on Democratic candidates, amounting to $3,078,958 and $2,968,530.

Considering these banks’ remarkable enthusiasm for Democratic leadership just sixteen months ago, and considering what little headway has actually been made on financial reform in the meantime, it would be odd for them to suddenly place their trust in Republican legislators instead. Indeed, the numbers available so far for the 2010 midterm elections reveal no great shift to the GOP while Jamie Dimon, CEO and chairman of JPMorgan Chase & Co. for one, continues to express his support for Democratic Party initiatives and regularly meets with the president.

It seems only fair to ask then: who is really falling victim to crony capitalism here?

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