BENEFITTING FROM BAILED OUT BOOSTERS…. The financial industry rescue from 2008 remains wildly unpopular, and more than a few candidates are running for Congress this year emphasizing their anti-bailout beliefs. But the Washington Post runs an interesting item today, noting that those that received bailout money aren’t exactly sitting on the campaign sidelines.
“Companies that received federal bailout money,” the piece noted, “including some that still owe money to the government, are giving to political candidates with vigor.” And not surprisingly, Republicans are benefiting from bailed out boosters.
This isn’t illegal, but there is something striking about the politics. This election season, Republicans are benefiting from a bizarre confluence of attitudes — the GOP supported the bailout, the GOP is picking up votes from those angry about the bailout, and the GOP is collecting cash from the companies that received the bailout.
Ezra Klein had a smart take on this earlier:
On Sunday, I rewatched an old episode of the West Wing. “Enemies Foreign and Domestic,” it was called, and one of the subplots involved a computer-chip manufacturer who’d just discovered a serious defect. The company was doing the right thing and recalling the product, but that left it, and its 90,000 workers, in jeopardy. Leo wants a bailout. President Bartlett doesn’t. And though, for awhile, the arguments gets made in economic terms, eventually Bartlett rounds on Leo. “They were huge contributors!” He yells. “Huge!”
The company gets some government help, but it comes at a cost. You can never donate to me, or any other candidate, again, Bartlett tells the CEO. “You can vote, but that’s it.”
The Obama White House is probably wishing it had added a similar clause to TARP. Not only are the bailed-out companies giving significant amounts of money — more than $1.4 million, at last count — but they’re giving most of it to Republicans. That leaves Democrats in an unhappy position: The voters blame them for the bailout (most Americans don’t know TARP was conceived and signed by the Bush administration), and the bailed-out companies are funding the other guys. They’ve managed to end up on the wrong side of both the people and the powerful.
It’s quite a trick the GOP has pulled off. Republicans demanded the bailout; Republicans are picking up big campaign checks from those that received the bailout; Republicans even tried to kill Wall Street reform to bring some safeguards and accountability to the industry that needed the bailout; but whenever the bailout comes up, everyone’s still mad at Democrats.
Even the perceptions are hard to shake. The Washington Post story on the donations noted in passing that “the TARP program was approved primarily with Democratic support.”
That’s sort of true, to the extent that more congressional Democrats voted for it than congressional Republicans.
But the details matter here. The financial industry bailout was passed in October 2008. It was requested by a conservative Republican administration (George W. Bush and Dick Cheney). It was enthusiastically endorsed by the House Republican leadership (John Boehner, Eric Cantor, and Roy Blunt), the Senate Republican leadership (Mitch McConnell and Jon Kyl), both members of the Republican presidential ticket (John McCain and Sarah Palin), and assorted, high-profile conservative voices (Mitt Romney and Glenn Beck).
Indeed, this year, the National Republican Congressional Committee is running attack ads against Dems who voted for TARP, despite the fact that they voted the same way as the chairman of … the National Republican Congressional Committee.
The political dynamic here made a right-turn at reasonable, hit the gas, and never looked back.