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Posted by on Jan 31, 2016 in 2016 Presidential Election, Featured, Politics | 33 comments

Clinton: The candidate of finance and the establishment

This weekend’s New York Times endorsement of Hillary Clinton should remind Iowa voters that Clinton is the candidate of the establishment.

Being part of the establishment comes with entanglements, beholden-ments … bindings to powerful institutions and the people who head them.

It’s the opposite of change, whether radical, transformative or disruptive.

This is business-as-usual, more-of-the-same.

So if “stay the course” is your mantra, particularly when it comes to Wall Street, Clinton is the logical candidate.

The ties that bind: finance

Simon Head, writing in The New York Review of Books this weekend, reminds us that one of those entanglements is with the institutions that brought the world’s economy to its knees less than 10 years ago.

In mid-2014, David Corn spotlighted Clinton’s connection to Wall Street.

Can the former secretary of state cultivate populist cred while hobnobbing with Goldman and pocketing money from it and other Wall Street firms? Last year [2013], she gave two paid speeches to Goldman Sachs audiences. (Her customary fee is $200,000 a speech.)

In late 2015, a NY Times reporter lamented:

Mrs. Clinton’s windfalls from Wall Street banks and other financial services firms… have become a major vulnerability in states with early nomination contests… It is an image problem that she cannot seem to shake.

In mid-January, the NY Times noted that Clinton had raked in $2 million in less than seven months giving speeches to Wall Street firms. In 2013, she took in $3.15 million by speaking to firms like Deutsche Bank, Goldman Sachs, Morgan Stanley, and UBS. In the past two years, Bill and Hillary have earned $25 million in speech income.

Clinton Foundation donors bleed green

Financial sector ties may be most troublesome in the context of Clinton Foundation finances. Head writes:

According to a February 2015 analysis of Clinton Foundation funding by The Washington Post, the financial services industry has accounted for the largest single share of the foundation’s corporate donors. Other major donors to the foundation have included US defense and energy corporations and their overseas government clients…

Big donor contributions mean access.

I examined the Clinton Foundation’s donor report, which shows cumulative lifetime giving through September 2015. Of course, there are the obvious links with Wall Street, like the Goldman Sachs Foundation.

But hidden in plain sight are extensive links to the global financial sector. I say “hidden” because many are not household names or because a philanthropic group has its roots in finance.

These Clinton Foundation donors are linked to the financial services sector. I was curious about individuals who had the net worth to donate between $1-5 million, so I checked out all of them. There were no indviduals making donations greater than $10 million; I did not check the bona fides of individuals making donations of less than $1 million.

Not a new concern: in 2008, NPR hinted that foundation donations could be a conflict of interest:

One of the questions that has come up over the course of this campaign is the amount of money, the millions and millions and millions of dollars that Bill Clinton has raised for his foundation … Some lists have leaked out, but we don’t know who is giving money, how much. And there can be questions of conflict of interest there…

The ties that bind: appearance of payment-for-favors

Head calls out an April 2015 analysis from the International Business Times.

Former President Bill Clinton accepted more than $2.5 million in speaking fees from 13 major corporations and trade associations that lobbied the U.S. State Department while Hillary Clinton was secretary of state, an International Business Times investigation has found. The fees were paid directly to the former president, and not directed to his philanthropic foundation.

IBT report on Bill Clinton finances

2015 IBT report on Bill Clinton ties to companies lobbying the State Department

Speaking fees to spouses appear to be exempt from “conflict of interest” rules.

“There isn’t an ethics rule that prohibits someone like Bill Clinton from charging exorbitant speaking fees and collecting those speaking fees from businesses that have interests before the administration,” Craig Holman told IBT reporters.

The big are getting bigger

Remember: the Clinton administration chief economic advisor, Robert Rubin, previously chaired Goldman Sachs.

These cozy ties with the world of finance (which includes banking, insurance, “investments” and restructuring companies “in crisis” and which has historically been centered in New York City) are not new. Maybe that explains why American mainstream media seem to be ignoring these links even though bank consolidation is worse today than in 2007.

[S]ix years after the banking system blew up the five biggest firms [Bank of America, Citigroup, JPMorgan Chase, US Bancorp and Wells Fargo] control 44% of the $15.3 trillion in assets held by U.S. banks.

In 2007, the five largest U.S. banks were Citi, Bank of America, JP Morgan Chase, Morgan Stanley and Wachovia.

After the financial collapse, only two stand-alone investment banks remain: Morgan Stanley and Goldman Sachs Group, Inc.

Concentration in financial sector

2016 Analysis from OxfamAmerica

Since 1992, total assets held by the five largest U.S. banks has increased by a factor of 15. The big have have gone from holding less than 15% of all US banking assets to almost 45%.

Asset concentration began in earnest after the 1999 repeal of Glass-Steagall (Democrat Bill Clinton + a Republican Congress). Congress passed Glass-Steagall in the wake of the great depression, forcing investment and commercial banking activities to be separate.

At the time, “improper banking activity,” or what was considered overzealous commercial bank involvement in stock market investment, was deemed the main culprit of the financial crash.

In other words, speculation … behavior at the heart of the 2007 crash.

Another cause of the Great Depression, according to Ferdinand Pecora, lead counsel for the Senate Banking and Currency Committee investigation, was “conflicts of interest and fraud … among elite finance and government officials.”

The Pecora investigations provided the factual basis that produced a consensus that the financial system and political allies were corrupt… The investigations discredited the elites that benefited from that system and were blocking reform.

The collapse of 2007 had no corollary to the Pecora investigation in the U.S. although Iceland has sent 26 bankers to jail.

With extensive ties to finance that stretch back 30 years, can Hillary Clinton be counted on to rein in Wall Street? I think not.

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Copyright 2016 The Moderate Voice
  • “Not a new concern: in 2008, NPR hinted that foundation donations could be a conflict of interest:”

    People not only hinted. It was a major concern back then. Rules were put into place to reduce the risk of conflicts of interest, most notably that Clinton was to disclose donations to the Foundation while Secretary of State.

    Clinton ignored this agreement, just as she ignored the rules to promote transparency regarding use of email.

  • “Democratic presidential frontrunner Hillary Clinton on Thursday declined to endorse legislation championed by Sen. Elizabeth Warren (D-Mass.) that would break up big banks. Warren and other liberals — including Clinton’s 2016 primary opponents Sen. Bernie Sanders (I-Vt.) and former Maryland Gov. Martin O’Malley — are pushing to reinstate legislation that President Bill Clinton repealed in 1999 called Glass-Steagall.” (Kevin Cirilli, “Clinton Dodges On Glass-Steagall,” The Hill, 7/23/15)

    • “Democratic presidential frontrunner Hillary Clinton…”

      Or, to be more precise, DLC Democratic frontrunner…

      And a DLC Democrat is basically pushing a Republican agenda, even if the DLC is not formally in existence any more.

  • Bob Munck

    As women have moved out of the metaphorical kitchen and toward (not yet “to”) an equal position in business, government, and all other aspects of society, we are increasingly confronted with complications caused by married couples who are both successful in the same or related fields. The Clintons are an obvious example, there’s another in the Supreme Court, one in the related areas of economic policy and the media, etc. We’re less troubled by other pair relationships — siblings, parent-offspring — and mostly untroubled by larger set relationships — corporations, unions, religions. We can only hope that this too shall pass.

    • Bob, please look at the relationship between lobbying and speech income again and tell me that you truly think that this is NOT an ethics violation.

      If Caesar’s wife must be above suspicion … so should Cleopatra’s husband.

      • It is partisanship blindness. The same phenomenon which leads to many Republican voters to still claim that there was WMD in Iraq and Bush was right.

        I imagine that, to them, people just suddenly decided they wanted to pay previously unprecedented speaking fees to Bill at the same time as Hillary became Secretary of State. If they paid these fees, or made lavish contributions to the Foundation, it was only a coincidence that they also had business before the Secretary of State at the time.

        • Bob Munck

          pay previously unprecedented speaking fees to Bill

          Reagan, November 1989, Japan: $2 million for two speeches ($3.8 million in constant dollars).

          • Payment for Reagan’s Japan tour was also unprecedented–and he took a lot of heat for it. This is quite a different situation than the Clintons. Reagan’s one shot tour in no way changes how the payments to the Clintons for speaking, including the huge jump in payments when Hillary became Secretary of State, were also unprecedented.

          • Bob Munck

            Payment for Reagan’s Japan tour was also unprecedented

            It was more — significantly more — than Clinton received. Given that, how were Clinton’s fees “previously unprecedented?” (And what does “previously” mean in that phrase?)

            huge jump in payments when Hillary became Secretary of State

            Keep in mind that Clinton received speaking fees of that same amount ($500K) before his wife became Secretary of State.

            I’d like to see a list of specific situations in which Secretary Clinton showed favoritism to a particular party because of speaking fees they had paid her husband.

      • Bob Munck

        look at the relationship between lobbying and speech income again and tell me that you truly think that this is NOT an ethics violation.

        Sorry, it’s not; it’s capitalism in the world of political money that the Congress and the SCOTUS has given us. You don’t win wars by unilateral disarmament. It seems to me that you’ve tried very hard to make a guilt-by-association argument.

        Look, I’m pretty far to the left of almost everybody, including Sanders, and I believe Clinton has the best chance of advancing aspects of MY agenda. Obama has shown us the limits on what a president can accomplish these days, and has also shown us how to make genuine progress. Clinton will do this; Sanders could, but will spend a couple of years shouting at the waves first, missing his window. (metaphor shaken, not stirred). Finally, I’m terrified by the possibility of a Republican president making the next SCOTUS appointments, which leans me toward a win at any cost attitude.

        (You’re at U-Dub? You may know an old student of mine, Ed Lazowska. Taught him everything he knows about OS design.)

        • SteveK

          Look, I’m pretty far to the left of almost everybody, including Sanders, and I believe Clinton has the best chance of advancing aspects of MY agenda.

          Well said… Me too! The rest of your comment pretty much nailed it too and is exactly why we need to get past all our ‘yeah buts’ and make sure a Democrat win the 2016 General Election.

          I’ve argued against all the misleading anti-Clinton rhetoric but I’ve never once said she would be my ideal candidate… I haven’t because she isn’t.

          But what she IS is America’s best shot at keeping the ‘current’ Republicans out of the White House and I really don’t understand the mindset of those who, though they feel a Republican Administration would be a disaster, say that they could never vote for her. That’s just too ‘bite off your nose to spite your face’ for me.

          • Bob Munck

            I’ve argued against all the misleading anti-Clinton rhetoric but I’ve never once said she would be my ideal candidate…

            Mee two!!1! Either!! I point out the exaggerations, baseless assumptions, and half truths, but I always get a chuckle when the perp assumes it’s pure heroine worship and aims his ad hominems at that imagined target.

      • Sadly this is the part of the system for everyone. Money has to be removed from politics, until then, they all have to go digging for it if they want to compete in national level politics.

        Obama has millions in small donations…did not need the big money, but he still had to bow down to Dem lobbyists, like teachers unions… because he was on top of the ticket and the DNC needed money for all of their candidates.

        The question is… will Sanders detach totally from the DNC or will he too do their bidding and pass/block legislation their donors ask for… Obama could NOT attach and he had money coming out of his ears.

        The USA will not elect a self proclaimed socialist… it wont happen.

  • dduck

    Nice article KG.
    I am a Rep and would like GS, in some form, reinstated.

    • Thanks, dduck.

      I don’t understand how anyone can look at either the great depression or the 2007-2008 meltdown and think it’s OK not to have separation. We also need to reverse consolidation of assets but that genie is going to be a helluva lot harder to put back in the bottle.

  • JSpencer

    Of course some Hillary supporters will stick with her until the bitter end, but most I’ve talked with have long viewed her with varying degrees of discomfort (based on issues discussed here and elsewhere). They lined up behind her because they believed her to be A.) better than the likely GOP prospects, and B.) the most capable of navigating the current complex labyrinth of government, and C.) the only democrat who would be electable. A, B, and C are all in play as usual for democrats, and we are constantly being called to examine, access and re-access. That is a healthy process, not a threatening one.

    I’ve preferred Bernie from the outset, and have considered Hillary to be somewhere in the realm of necessary evil/pragmatic choice, but the ground is shifting under our feet and so we must shift too when necessary. One of my concerns (which has been expressed well by others here) is that Bernie and Hillary supporters not create bad blood that would prevent full unity and participation of democrats in the general election. I’ve seen democrats do this in the past and it has cost them (and the country) dearly. Back your candidate and show why you do it, but respect your allies because you will need them one day.

    • dduck

      In other words, hold your nose and vote for Hillary?

      • We have to hold our nose because we allow undemocratic processes to select the two people we have to chose from. The DNC and RNC basically own national level politics and we are typically stuck with their selected trash. Some people will sometimes elect an independent, but that is not very often.

      • JSpencer

        Only if Sanders doesn’t get the nod. I say this because I suspect Cruz will end up being the alternative – unless the R convention changes everything.

  • Slamfu

    As further proof of HRC being establishment, less than 5 days after Clinton said she’d be open to more debates, after months and months of people wanting exactly that, the DNC has finally come around.

    Funny that. I wonder if Hillary Clinton has told DWS who the moderators will be yet? If I had to guess I’d say David Brooks, William Jefferson Clinton, and DWS herself*.

    • Bob Munck

      As further proof of HRC being establishment …

      You’re accusing her of having strong ties to the Democratic Party and the Democratic National Committee? Why is that a bad thing? She’s running for the Democratic Party nomination.

      • Slamfu

        Yes, but the same can be said of the other Dem nominees who aren’t shown such blatant favoritism. My understanding was that the Democratic Party hold a primary and not try to sway the outcome for any particular candidate. Back when Sanders was a virtual unknown and Hillary Clinton was a household name, it was wildly beneficial to the Clinton campaign to limit the number of debates, and therefore the amount of exposure that any challenger would have. Not only the number of debates, but the times they were allocated to. Of course, the gap has narrowed now, and Clinton needs to do something to stop the bleeding of support that has been pretty one way these last 6 months, from her numbers to Sanders.

        My issue here btw isn’t with the Clinton campaign, they’re doing what they should be doing, everything to win within the rules. Over the course of the last year I have become increasingly disgusted with the strategy, policies, and actions of the DNC though. My critique is of them, and not Clinton.

        • Bob Munck

          Over the course of the last year I have become increasingly disgusted with the strategy, policies, and actions of the DNC though.

          I agree with that; I stopped contributing to them four years ago. Now they get a short but heartfelt lecture when they call.

          One possibly-relevant detail: Sanders was not a member of the Democratic Party until announcing his candidacy. Does he have any claim to fair treatment by the party? Perhaps he’s now paying a price for all those years in the House and Senate standing aloof from the party and running against its candidates.

          My critique is of them, and not Clinton.

          I was perhaps mislead by the first few words of your previous comment.

          • Slamfu

            I was perhaps mislead by the first few words of your previous comment.

            Lol yea, looking at it, that is pretty understandable, because that is pretty much what I said 🙂 /sheepish

            And as for Sanders deserving of support, only if they are smart. As mentioned before, the plurality of voters these days aren’t registered with either party. In fact, fewer than 1/3rd of voters can be claimed by either, closer to 1/4. If I were the DNC, I’d be pretty stoked to have someone with popularity among independents who was willing to be my candidate, garnering both party support and digging into the now all important independent voter bloc. The DNC currently seems to be so focused on only backing their party line, their own minority of registered voters, while ignoring all those others as irrelevant, and imo this is a huge, and very arrogant mistake. We’ve seen what it has done to the GOP, being unable to field someone in the General by forcing them to adhere so tightly to the party line that no one who can get the GOP nod can make their case later. Yet the DNC seems hellbent on following in their footsteps for some reason.

          • Bob Munck

            The DNC currently seems to be so focused on only backing their party line

            I’ve never seen Sanders as being particularly in conflict with the fundamental dogma of the Republican Party and of the progressive movement. I think he has basically the same ultimate goals as the leaders of the party — Obama, Clinton, Biden, Warren, Pelosi, etc. Sure, there are minor difference in the details, but the major disagreements among the members of that group are about strategy and tactics — how you get from here to there, not where “there” is.

            I believe that Sander’s proposed tactics are seriously wrong for the current situation. Obama was wrong about tactics eight years ago because he didn’t fully understand the then-situation, and that may be Sander’s problem today. Clinton seems to understand what we face, but I wish her tactics were a bit bolder.

            If I may make an analogy, I think that too many Democrats see our opponents as being like the British Army at the beginning of the Revolutionary War: they’ll follow all the rules, line up in formation, wear their red coats, and march across the battlefield in good order. I see our opponents as more of a ravening horde of zombies organized like the bad guys in the Mad Max movies. (I’m sure everyone thought of Ted Cruz when they read my description.)

          • JSpencer

            Good analogy/s. As for Cruz, now that he’s a “winner” we’ll be seeing even more of him. We are being tested…

          • Bob Munck

            We are being tested…

            More like “punished…”

          • Bob Munck

            Oy! Second line, s/Republican/Democratic/g
            I hope it made the screwup obvious that I then said “and of the progressive movement.”

  • This was not an ad hominem (personal attack) and I’m annoyed at any suggestion that this is the case.

    These are points that Clinton the candidate has not addressed very well and should she be the nominee she will need to.

    I am personally disappointed in their behavior and apparent obliviousness to questionable behavior.

    I didn’t think Obama was electable (I was wrong) and I thought his rhetoric was deliberately “left-of-center” and not genuine belief/trustable (I was right on many issues).

    I wish Bernie would label himself as as social democrat. Because he’s a socialist only in the context of the US being very very conservative (global perspective).

    • dduck


    • Bob Munck

      I wish Bernie would label himself as as social democrat.

      Too late! That ship has sailed. And given the way the right wing has been demonizing the word “socialist” for the last half-century, one would almost think that they’ve invented a time machine, gone back to the 60s, and warned their grandfathers to get ready for Bernie.

      When Obama was running, the right wingers were inhibited from calling him the worst names they were thinking, because society sees them as obscenities. With Sanders there will be no such inhibitions; they’ll shout “Socialist!” loud and long, and it will resonate deep in the brain-stems of many voters.

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