Likely 2020 Dem contenders to face scrutiny over Wall Street ties

Ties to Wall Street and corporate interests are raising concerns about a number of high-profile Democratic candidates considering White House bids as the party moves to reduce the influence of big money in campaigns.

Sens. Cory Booker (D-N.J.) and Kirsten Gillibrand (D-N.Y.) are likely to face questions about money they’ve received from financial institutions in Wall Street, according to strategists.

Meanwhile, former Vice President Joe Biden has his own ties to banks and credit card companies, dating back to his years in the Senate, while Sen. Kamala Harris (D-Calif.) could face scrutiny over her reluctance in 2013 to prosecute Steven Mnuchin’s OneWest Bank when she was attorney general of California.

{mosads}The pushback could come as progressives such as Sens. Elizabeth Warren (D-Mass.) and Bernie Sanders (I-Vt.) turn to small donations to fuel campaigns, avoiding corporate donations that they, and many in the Democratic base, believe taint the electoral process.

“Here would be my warning to any candidate who’s thinking about running in this environment today: This is not 2008. This is not 2012,” said Chris Kofinis, a Democratic strategist.

“Because everybody is hyper aware of everything, all of a sudden what you do and who you take money from, becomes a reflection of your values much more so than ever before,” he added.

Gillibrand and Booker have cultivated strong ties to the U.S. financial sector, which is heavily concentrated in New York, and are among the Senate’s top recipients of donations from the industry, though they have often voted for legislation against the interests of the financial sector.

Gillibrand reeled in $3.2 million from the financial industry during her 2012 Senate campaign, second only to former Massachusetts GOP Sen. Scott Brown’s $5.7 million, according to the Center for Responsive Politics. That included about $90,000 each from Goldman Sachs and Morgan Stanley as well as $63,500 from Blackstone.

Gillibrand was less reliant on the industry during her reelection campaign in 2018, but still received more than $2.4 million in contributions, including from Bank of America, Morgan Stanley and Blackstone.

Booker, meanwhile, accepted $4.4 million from donors employed in financial services during his 2014 Senate campaign, more than any other Senate candidate running that year. Booker ran in two elections in that cycle, because there was first a special election in 2013. 

Among Booker’s leading contributors from the financial industry in 2014 were also Goldman Sachs, Prudential Financial, Morgan Stanley and J.P. Morgan Chase, which all gave his campaign more than $50,000 in contributions.

Booker had previously faced criticism from the left in 2012 for defending then-Republican presidential nominee Mitt Romney from attacks against Bain Capital, the private equity firm founded by Romney that former President Obama’s campaign criticized for valuing profits over employees.

“It’s nauseating to the American public,” Booker said at the time. “If you look at the totality of Bain Capital’s record, they’ve done a lot to support businesses [and] to grow businesses.”

Others candidates may also come under attack over their financial ties.

Former New York City mayor Michael Bloomberg, who has said he is considering a run, is himself a billionaire and the founder of Bloomberg, a financial data and media empire.

Biden, also considered a possible front-runner, has cultivated close relationships with financial companies such as credit card companies while in the Senate, and was once derided as “the senator from MBNA,” a Delaware-based lender now owned by Lloyds Banking Group.

But he has since sought to maintain some distance, including by avoiding giving speeches to corporations, according to The New York Times, after 2016 Democratic presidential nominee Hillary Clinton came under scrutiny over a speech she delivered to Goldman Sachs.

Meanwhile, Harris, who officially entered the race this week, has been scrutinized by some liberals for not pursuing charges against OneWest Bank in 2013 over alleged foreclosure violations when the lender was chaired Mnuchin, now the Treasury secretary.

Harris defended her decision, saying it had been based on “facts and the evidence.” She voted against confirming Mnuchin.

Spokespeople for Gillibrand, Booker, Harris, Biden and Bloomberg did not return requests for comment from The Hill.

Strategists said those types of ties to the financial sector could hurt candidates, especially because they will run against high-profile candidates like Warren who have repeatedly rejected the influence of mega-donors.

Warren, who announced the launch of an exploratory committee for president last month, called on Democrats earlier this month to reject the influence of mega-donors.

“Is this going to be a Democratic primary that is funded by the grass roots, that is done with grass-roots volunteers, or is this going to be something that’s just one more plaything that billionaires can buy?” Warren asked during an appearance on MSNBC.

Warren has also built her Senate career in part by demanding more accountability from the banking and financial sector and played a key role in the establishment of the Consumer Financial Protection Bureau.

Sanders, who hasn’t announced a 2020 bid so far, centered his 2016 presidential campaign on making financial and economic policies less amenable to Wall Street and the wealthy.

The Vermont senator is likely to bring similar rhetoric to a potential 2020 bid. In a fundraising email teasing a run last month, he slammed “Wall Street Democrats” and blamed them for “record levels of inequality.”

{mossecondads}The ties to the financial industry could be scrutinized at a time when Wall Street is stepping up its campaign contributions to congressional candidates.

During the 2018 election cycle, the securities and investment industry gave $61.1 million to Democratic candidates and $37.1 million to Republican candidates, according to the Center for Responsive Politics.

Strategists said candidates with perceived ties to Wall Street would need to inoculate themselves, including by highlighting their own records.

While Gillibrand and Booker have reaped millions from the financial sector, they’ve frequently voted against the industry’s interests, and in favor of policies fiercely criticized by the industry.

Gillibrand has sponsored legislation to create a retail banking system operated by the United States Postal Service, a proposal fiercely opposed by the industry.

Gillibrand and Booker also opposed the bipartisan rollback of post-crisis banking rules enacted by President Trump last May, and voted against all of the president’s financial regulatory nominees.

Gillibrand, who announced her candidacy for president last week, has already said she will refuse donations from corporate political committees and focus on building a powerful small-dollar donor network.

“This campaign is going to be run for and by people, not corporate PACs—that’s how we live by our values. Thank you!” she tweeted last week.

Booker has also worked to distance himself from the perception that he is tied too closely to the financial industry.

Last year, he criticized Bain Capital — the firm he defended in 2012 — after Toys “R” Us was driven out of business under the firm’s management.

“This is a moral question,” he said during a news conference at the time. “It’s a question of whether or not we in this society will accept a reality where so many big finance firms can saddle a company with debt, collect exorbitant fees, negotiate away the future of tens of thousands of workers and then, when the company goes south, walk away with hundreds of millions of dollars of profit in their pockets.”

Similar moves will be essential for these candidates going forward, according to strategists.

“Among Democratic primary voters I do think they have a suspicion and a problem with candidates who can be described as beholden to Wall Street,” said Democratic strategist Brad Bannon.

“Just the appearance of raising money on Wall Street is deadly to your chances,” he added. “If you are successful raising money on Wall Street, it’s going to be a big problem for you once you start spending it.”

UPDATED on Jan. 27 at 12:45 p.m.: This story was updated to reflect that Booker ran in two elections in the 2014 cycle because of a special election.