Wall Street Surge for Obama

by Marty Goodman / November 2008

No one doubts that president-elect Barack Obama’s campaign re-awoke millions to politics. New energy was released, especially in the African-American community, where many saw his campaign as a repudiation of racism and the hated policies of George Bush.

The new energy included an unprecedented number of working people who gave their small, heartfelt donations to Obama over the internet. Forty-eight percent of Obama’s donations were under $200, compared with just 34 percent for Republican John McCain. Aided by technology, the phenomenon was touted by some as the start of a new bottom-up democracy.

Well, capitalism doesn’t work that way. Generally hidden by the corporate media, and certainly in Obama’s well-crafted speeches, is the reality that working-class voices will have a hard time being heard over Obama’s high-roller corporate supporters.

The fact is, 43 percent of Obama’s campaign donations were over $2300. Ten percent of his donations were for $4600, the maximum individual contribution allowed for a presidential candidate.

Some well-connected Obama operatives, just like Republican operatives in the John McCain camp, tapped wealthy friends and connections for big contributions. Called "bundlers," they handed over to Obama huge stacks of checks totaling up to $500,000 or more.

One late campaign report that appeared in the Nov. 3 Washington Post noted that Obama "over the past two weeks … raised $11 million in large donations of $1,000 or greater."

When policy is decided, Obama won’t be consulting the voter with the 200 bucks. Obama’s big money backers are the very same people who are responsible for the Wall Street meltdown, foreclosures, layoffs and the continuing oppression of the African American community, especially in the disproportionate number of foreclosures on rip-off mortgages

Pay to play

According to a post-election estimate by Massie Ritsch, communications director of the Center for Responsive Politics (CRP), a non-partisan group that tracks campaign funding, the Obama campaign took in a total of about $700 million versus $360 million for John McCain.

McCain opted for $84.1 million in federal funding after he was nominated in August, which limited—but did not stop—his fundraising. Obama reversed his stand on federal funding to continue his fundraising blitz.

This year’s "pay to play" presidential campaign will cost at least $1 billion and probably much more, an unprecedented sum. The CRP predicted that the total spent would be closer to $2.4 billion, twice the 2004 total and triple for 2000. The CRP also predicted that an incredible combined total of $5.3 billion would be spent on all the federal races, which include Senate and House contests.

Of that amount, the CRP concluded, "business interests account for about 72% of all contributions, with ideological, labor and other interests making up the rest."

It’s no wonder Democratic and Republican politicians lined up to bail out Wall Street in the mortgage crisis. The CRP says the number-one campaign donor corporation in 2008 is the top Wall Street firm, Goldman Sachs; next is Citigroup at $4.2 million, followed by JP Morgan Chase & Co. at $4.1 million. The biggest-giving industry association is the National Association of Realtors, which has given nearly $3.2 million.

According to a survey of campaign contributions that appeared in The New York Times, (Oct. 21), the "biggest portion" of donors who wrote checks of $25,000 or more to either candidate’s main joint fundraising committees, "came from the securities and investments industry, including various firms embroiled in the recent financial crisis like Bear Stearns, Lehman Brothers and AIG."

Obama vies with Clinton for the largest contributions ever received from Lehman Brothers.

Obama, said The Times article, "leaned heavily on wealthy benefactors. More than 600 donors contributed $25,000 or more to him in September alone, roughly three times the number who did the same for Senator John McCain."

According to the CRP, Obama received $12.6 million from "Securities and Investment" firms versus McCain’s $7.9 million. Obama’s loot topped G.W. Bush’s Wall Street record of $10.8 million in 2004.

Among Obama’s 10 biggest contributors were top Wall Street players, which include his second highest contributor, Goldman Sachs ($874,207); JP Morgan Chase & Co. was sixth ($581,460); and seventh was Citigroup Inc. ($581,216).

Among McCain’s top 10 backers were Wall Street firms Merrill Lynch, first at $359,070; Citigroup Inc was second at $296,151; Morgan Stanley was third at $262,777; Goldman Sachs was fourth at $228,695 and JP Morgan Chase was fifth at $215, 042, etc. (Figures listed represent individual contributions from owners or employees and families or PACs.)

In the big-bucks category, the CRP divided contributors into a $2300-plus category and the $4600 individual maximum. Obama got the most of this group, with 68,761 contributors and 40,616 for McCain, representing 43% and 67% of their totals respectively.

As Obama carefully laid out his cautious, pro-business agenda, the capitalist class seemed to have gained confidence in him, filling his coffers. Obama voted twice for Bush’s Wall Street trillion-dollar bailout. Although pledging to increase taxes on the wealthy, as he explained, his proposed tax is so mild that it is less than what the rich paid during the conservative Reagan years.

He also promised to continue the carnage in Iraq until an uncertain U.S. withdrawal after 16 months, and to increase U.S. troops in occupied Afghanistan. Earlier this year, Obama lavished gushing support for apartheid Israel at a convention of the pro-Israel AIPAC.

A closer look

According to the CRP, Obama received from people in "finance, insurance and real estate" companies—those most responsible for the current crisis—$33.1 million in contributions versus $26.2 million for McCain. Real Estate contributions favored Obama, with $25 million versus McCain’s $22 million.

Among lawyers and lobbyists, Obama trumped McCain $37.1 million to $10.7 million. Obama also clobbered his opponent in the health-care industry, entertainment, and among college professors and students.

Obama’s contributions from the communications and electronics industry exceeded McCain’s by $21.6 million to $4.3 million. In the miscellaneous business category, Obama trounced McCain, $29.6 million to $14.6 million.

For his part, McCain maintained traditional Republican leads in funding from agribusiness, transportation, and oil and gas. Although McCain accepted federal funding for his campaign, which limits the amount a candidate can privately raise, he nevertheless continued to raise money through joint fund-raising committees, from which funds for primary campaigns, the Republican National Committee, several state parties, and a compliance fund, can be combined to seek a maximum single contribution of $70,100.

In its’ maximum "bundle" category of $500,000 or more, the CRP discovered "534 elites have directed at least $75,750,000 to McCain, and 509 have gathered at least $63,300,000 for Obama."

Says Rick Hasen, an election law specialist at Loyola Law School, "Gone will be the $2300-a-plate dinner. That will be replaced by the $30,000-a-plate dinner, the kind of select event Obama had hosted by folks like Warren Buffet. And the rest will be the micro-donors—entirely internet-based."

The two campaigns demonstrate that no matter what campaign financing laws are, the capitalist rulers will insure that its chosen representatives will have whatever it takes to dominate the electoral arena.

Not surprisingly, the CRP found that for the first Wall Street bailout vote, House members that voted for the bailout "collected 51% more than opponents from the industries most eager for emergency aid. The Senate vote was similarly divided."

Says the CRP, 62% of Senate members and 39% in the House of Representatives could be considered millionaires and commonly benefit from stock investments. Members of Congress, who are now paid about $169,000 annually, saw their net worth soar 61% from 2004 to 2007, on average.

Obama no champion of little guy

Obama considers himself a "free-trade" advocate but one who does call for some government intervention when he believes it necessary. He’s surrounded himself with like-minded pro-business, free-trade advocates from the Clinton administration. Some, like Obama aide Robert Rubin, backed stock-market deregulation in the 1990s, contributing in no small measure to the current crisis.

On one key issue, Obama formerly called for "renegotiating" the NAFTA free-trade agreement, signed by Bill Clinton, when speaking to angry Midwest workers. NAFTA exported hundreds of thousands of U.S. jobs to Mexico and destroyed the livelihoods of a million Mexican farmers.

In June, Obama gave an interview to the elite Fortune magazine reversing his stand. Entitled, "Obama: NAFTA Not so Bad After All," he called his previous position "heated and over amplified."

Like most campaign promises to the working class, his earlier stand was just empty rhetoric. Capitalist politicians like Obama are loyal to only one group—their wealthy backers. That’s where the real deal goes down. And 2008 was no exception.