Mitt Romney draws more Wall Street donations than Obama
Mitt Romney's six largest campaign donors in 2011 were from Wall Street. Romney got $1.8 million from Wall Street execs, according to the Center for Responsive Politics.
(Page 2 of 2)
Wall Street money, like funds from other walks of life, is pouring in both as traditional campaign donations, which are limited to $2,500 per donor, and as unlimited gifts to Super PACs.Skip to next paragraph
Subscribe Today to the Monitor
The Super PACs are the legacy of a 2010 Supreme Court decision that unlimited donations by individuals, corporations and unions to groups that operate independently from campaigns.
Working through Super PACs, a few wealthy managers of top hedge funds and private equity firms are pumping money into the political process at unprecedented levels.
Seven of them have given more than $5 million combined to Restore Our Future, a Super PAC that backs Romney. That was more than Obama's Super PAC, called Priorities USA, raised in all of last year. Priorities USA's donor list is topped by labor unions.
Leading supporters of Romney from the financial industry include hedge fund managers Robert Mercer, Julian Robertson, Paul Singer and Chris Shumway, as well as private equity leaders Miguel Fernandez and Steven Webster.
Each has given at least $250,000 to the pro-Romney Super PAC.
Hedge funds and private equity firms also have been a key source of traditional campaign gifts to Romney.
NEW PLAYERS ARRIVE
Private equity and hedge fund managers arrived on the political scene in 2005.
That was when Congress began scrutinizing the "carried interest" tax break that lets these managers pay a tax rate on much of their earnings that is much lower than the top U.S. income tax rates.
The first private equity lobbying group was set up in 2006, a month after Democrats won control of both houses of Congress.
More than five years later, the "carried interest" tax break remains in place, although Democrats still say they may seek to eliminate it as part of a plan to trim the federal budget.
Hedge funds and private equity firms are keen to protect the tax break, while Wall Street banks want to roll back portions of Dodd-Frank or, at least, minimize the costs and restrictions it imposes on them as U.S. regulators continue to implement it.
Democrats' threats to close the carried interest loophole, coupled with their strong support for Dodd-Frank regulations and Obama's frequent verbal jabs at the banks, have opened a rift between him and the industry that briefly embraced him three years ago, said American University Professor Leonard Steinhorn.
When Obama came to power, the industry assumed it would have cozy ties with him, as it had with President Bill Clinton in the 1990s.
At first, it did. Then the economy tanked and Obama began to criticize bankers for their role in the credit crisis. Such criticism from a president was a jolt to leading bankers, who were accustomed to flattery from Washington.
"These are people who were totally alienated from Obama when he stopped praising them. Some of them got bitter. These are folks with large egos who like to be stroked," Steinhorn said.
Many bankers have felt uneasy in recent years with the social conservatives who have gained power in the Republican Party, but the bankers likely feel they can relate to Romney, analysts say.
"Romney is one of them," Steinhorn said. "So they can feel comfortable with him." (Editing by David Lindsey and Cynthia Osterman)