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As GOP attacks mount on the issue of Senator Obama’s ties to Political Action Committees and Lobbyists, Obama’s campaign has undergone little scrutiny on his long-standing ties to the financial and banking community. In Obama’s speeches across the country he has repeatedly criticized the Bush administration for allowing “evil” subprime mortgage lenders and investment banks to lead this county into our current mortgage meltdown. Obama’s rhetoric on the mortgage crisis has been pointed and blunt, as stated on his own campaign website, “Obama will crack down on fraudulent brokers and lenders…Obama has been closely monitoring the subprime mortgage situation for years, and introduced comprehensive legislation over a year ago to fight mortgage fraud and protect consumers against abusive lending practices”.
Throughout the campaign season Obama has attacked Wall Street’s financial sector and ran a campaign based largely upon his “good judgement”. The problem with Obama’s rhetoric rests in the fact that tucked away in his database of 1.5 million donors are the approximately 130,000 power brokers that have funded nearly 60% of his campaign. Included in this list are the more than 350 campaign bundlers who have accounted for over $78 million in contributions.
Among those campaign bundlers is Paul Roth, a partner at Schulte, Roth & Zabel, a firm that represents financial institutions including investment banks, securities firms, and hedge funds. Roth not only contributed to Obama’s campaign but also helped to “bundle” more than $50,000 for the Senator. The Obama bundler rolls also include Tom Wheeler, the managing director of Core Capital Partners, a Washington based private equity fund, have helped raise more than $100,000 for the Obama Campaign.
The real problem for Obama extends well beyond his campaign bundlers that include several prominent lobby–representing attorney’s and executives such as Frank Clark, the CEO of Commonwealth Edison. Executives across the financial and investment industry have accounted for millions in campaign contributions.
In San Antonia this past February Obama stated in a campaign speech, “To give you a sense of what that kind of lobbying gets you… the CEO of the largest subprime lender was promised a hundred-million-dollar severance package at a time when more than 2 million Americans were facing foreclosure, including nearly 14,000 right here in San Antonio..." Obama was most likely referring to an Angelo R. Mozillo, one of three CEO’s that were scheduled to appear to testify in front of a senate committee concerning their compensation and firms roles in the ongoing mortgage crisis. Stanley O’Neal, who received more than $161 million when he was ousted as the Chairman of Merrill Lynch, was one of the three CEO’s coming under scrutiny. In 2003, O’Neil donated to Senator Obama’s Senatorial campaign, followed up by a maximum $4,600 campaign contribution by he and his wife, Nancy Garvey, to the Obama Campaign. Ironically, the O’Neals tried to originally contribute $6,900 to the campaign only to have $2,300 returned.
O’Neil, Mozillo, and Charles Price have been branded the “poster-child” CEOs of the financial firms responsible for the mortgage meltdown and at least one of the three was a valuable contributor to the Obama campaign.
Also contributing to Obama’s cause is the more controversial Brad Morrice, the former CEO and President of the imploded subprime lender, New Century Financial. Morrice and his wife contributed the maximum $4,600 to Obama’s campaign last August.
Obama has also accepted campaign contributions from dozens of Lehman Brothers Executives, such as CEO Richard Fuld ($2,300), President Joseph Gregory ($4,600) and dozens of other top Lehman Executives. On June 19th, Lehman shareholders filed suit against Fuld and Gregory for the company’s exposure in the subprime market.
Among other subprime contributors to Obama’s campaign are Steve Boland, a managing director at Countrywide, who donated the maximum last June. Andrew Beer the president of Wachovia’s troubled subprime lender Evergreen Investment Partners also maxed out his contribution to the Obama campaign; and Joseph Azrack, the president of Citigroup Property Investments along with dozens of Citi Executives have heavily contributed.
In 2007 Eric Schwartz, the co-head of Goldman-Sachs Global Asset Management abruptly stepped down from is position, fueling rumors that his resignation was tied to a crumbling Global Alpha Hedge Fund. The Fund’s mounting losses led to a -39% performance last year as the fund assets shrunk by 60%. Shwartz, an Obama bundler and contributor, has helped to raise over $50,000 for the Senator’s Campaign.
In 2007 Robert Wolf, the CEO of UBS Americas, helped the Obama campaign raise more than $200,000. That amount was equaled by Louis Susman, the Chairman of a Citibank Subsidiary. Joining their efforts was Mark Gilbert, a Senior Vice President of Lehman Brothers.
Additional High Profile Financial Executives Include:
Richard Leweke – Vice Chairman of Washington Mutual Card Services
Seth Waugh – CEO of Deutsche Bank
Charles Lewis – Vice Chairman of Merrill Lynch
Theodore Janulis – Bundler (over $50,000) & Lehman Brothers Head of Global Mortgages
Francisco Borges – Bundler (over $50,000) and Chairman of Landmark Partners a private equity real estate firm.
Nadja Fidelia – Bundler (over $50,000) & Managing Director of Lehman brothers
Michael Froman – Bundler (over $50,000) & Managing Director of Citigroup
David Heller – Bundler (over $200,000) & Managing Director of Goldman Sachs
John Rhea – Bundler & Co-head of Lehman Brothers Global Investment Banking
J. Michael Schell – Bundler (over $100,000) & Managing Director at Citigroup
Jim Torrey – Bundler (over $200,000) and founder of the Torrey Funds – Hedge Funds
Todd Williams – Bundler (over $50,000) & Managing Director Goldman Sachs & The Real Estate Council
The listing of contributions flowing in from Financial Institutions through Senator Obama’s career is short of amazing. There are currently dozens upon dozens of Senior Vice Presidents, Managing Directors, and other top level executives from firms such as Lehman Brothers, Wachovia, Washington Mutual, Citigroup, Wells Fargo, UBS, Deutsche Bank, Merrill Lynch, Goldman Sachs, Bank of America, JP Morgan Chase, Morgan Stanley and other high profile Wall Street banks and funds mired in the mortgage meltdown.
Obama has been relentless in his attacks upon the “evil” Wall Street executives that he has blamed for the ongoing fallout from the mortgage crisis, positioning himself on a “moral high ground”. The reality is that while Obama has been slapping the mortgage companies and investment banks with one hand, he has had his other hand in their wallet.
Politically Drunk On Power
June 26th, 2008
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