Why Wall Street's political poison doesn't reach many incumbents

Pols fall in lock-step with big business because of all that, well, money

Published May 25, 2010 10:58PM (EDT)

Today’s quiz: At a time when California’s Republican gubernatorial candidate Meg Whitman is losing ground to her Republican rival in the primary because of her ties to Wall Street, when Utah’s incumbent Sen. Robert Bennett was just booted out by Republicans who are furious that he voted to bail out Wall Street, when New Jersey’s Jon Corzine lost his bid for reelection partly because he was formerly head of Goldman Sachs, when Connecticut’s Chris Dodd was so tarnished by his close ties to Wall Street that polls showed he had little chance of reelection -- at a time, in other words, when Wall Street is political poison, why are politicians still so intent on doing its bidding?

Answer: Wall Street’s money for upcoming campaigns.

Case in point: The measure in the banking bill that would force banks to push their derivative trading into separate units rather than rely on taxpayer-subsidized insured deposits. For reasons I’ve already stated, the measure is common-sensical.

Wall Street hates it because it would cost it billions.

Already New York Rep. Michael McMahon says he’ll work to remove it from the bill. Yesterday, New York Rep. Gary Ackerman, also a member of the finance committee, told his staff to circulate a draft letter yesterday to House members seeking their opposition to it.

Watch who signs Ackerman’s letter. Listen for the positions of members of the conference committee. Vote accordingly next fall.

By Robert Reich

Robert B. Reich is Chancellor's Professor of Public Policy at the University of California at Berkeley and Senior Fellow at the Blum Center for Developing Economies. He served as Secretary of Labor in the Clinton administration, for which Time Magazine named him one of the ten most effective cabinet secretaries of the twentieth century. He has written 15 books, including the best sellers "Aftershock", "The Work of Nations," and"Beyond Outrage," and, his most recent, "The Common Good." He is also a founding editor of the American Prospect magazine, chairman of Common Cause, a member of the American Academy of Arts and Sciences, and co-creator of the award-winning documentary, "Inequality For All." He's also co-creator of the Netflix original documentary "Saving Capitalism."

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2010 Elections Wall Street