Bankers deserting Obama for Romney
posted at 2:01 pm on May 16, 2012 by Ed Morrissey
Why did fundraising for Team Obama drop so precipitously in April? The Boston Globe provides one possible answer. In 2008, Barack Obama attracted a lot of support from the banking industry. This time around, they have deserted Obama in favor of Mitt Romney (via News Alert):
When the head of JPMorgan Chase met with shareholders to answer for a trading loss of more than $2 billion Tuesday, it was against an evolving political backdrop: Donors from big banks are betting on Mitt Romney to defeat President Obama and repeal new restraints on risky, large-scale investments.
“There’s no doubt that there’s been a big diminution of support for the president,’’ said William M. Daley, Obama’s former chief of staff and a former top JPMorgan Chase executive. “People in the financial services sector are saying, ‘The president has been too tough on us, both in policy and on rhetoric.’ ’’
The top five donor groups in Romney’s campaign are individuals and political action committees associated with large financial institutions, led by Wall Street giants Goldman Sachs and JPMorgan Chase, according to information compiled by the Center for Responsive Politics, a nonpartisan research group that tracks campaign donations.
By contrast, Obama’s top five contributor groups include individuals and PACs affiliated with high technology giants Google Inc. and Microsoft Corp., and the global law firms DLA Piper and Sidley Austin, and do not include those associated with banks. In 2008, financial institutions backed him generously.
This being the Boston Globe, the article then adds this hopeful note:
Analysts said the JPMorgan loss could be a political opportunity for Obama – and an obstacle for Romney.
Er … probably not:
President Obama has between $500,001 and $1 million dollars in a JPMorgan Chase account, according to financial disclosure forms released Tuesday by the White House.
The bank — that’s now being looked at by the Department of Justice after posting a massive $2 billion trading loss last week — is the home of a joint checking account the Obamas have with its Private Client Asset Management division. The Obamas have a second checking account with JPMorgan with assets between $1,001 and $15,000.
That’s a big increase from his 2011 disclosure form, where the JP Morgan Chase account showed no more than $250,000 in assets.
And let’s not forget his endorsement of JP Morgan just days after the $2 billion loss was exposed:
Just hours after a top JPMorgan Chase executive retired in the wake of a stunning $2 billion trading loss, President Obama told the hosts of ABC’s “The View” that the bank’s risky bets exemplified the need for Wall Street reform.
“JPMorgan is one of the best-managed banks there is. Jamie Dimon, the head of it, is one of the smartest bankers we got and they still lost $2 billion and counting,” the president said. “We don’t know all the details. It’s going to be investigated, but this is why we passed Wall Street reform.”
Yeah — how exactly will that work, anyway? Jonathan Weil explains for Bloomberg, after JPM CFO Douglas Braunstein gave the Chip Diller “All is well” speech to investors:
In other words: Clearly there wasn’t a problem, because if there was, the regulators would have seen it. And of course, by all indications, they didn’t see it, even though they were embedded in JPMorgan’s offices. On May 10, JPMorgan divulged $2 billion of intra-quarter trading losses and said they might get worse.
Once again, regulators seem to have been oblivious to huge risks at a bank they were supposed to be overseeing. To JPMorgan, however, they also have served a valuable purpose.
Having regulators around the clock at JPMorgan reinforces market expectations that the government has an obligation to stand behind the bank should it run into more serious trouble. Also, lest anyone forget, JPMorgan’s chief executive officer,Jamie Dimon, sits on the board of the Federal Reserve Bank of New York, even as the Fed is one of the agencies now investigating JPMorgan’s trading debacle.
The regulators’ very presence also may be of personal benefit to anyone at JPMorgan who might face scrutiny later from federal investigators. Let’s say the Securities and Exchange Commission were to consider accusing JPMorgan executives of possible rule violations. If what Braunstein said is true, there’s a chance these people might defend themselves by saying that everything they did was right under the regulators’ noses.
This might be one reason the government hasn’t brought a case, criminal or civil, against former executives of Lehman Brothers Holdings Inc. For several months before it collapsed, regulators were inside Lehman’s offices full-time, as the company’s bankruptcy-court examiner,Anton Valukas, noted in his 2010 report on Lehman’s failure.
With cover like that, it’s truly a wonder that bankers and other financial institutions are deserting Obama. That’s probably because the regulation cover doesn’t make up for the class-warfare rabble-rousing in which Obama has engaged since last September, and for the abysmal economic policies that has the US economy in long-term stagnation.