Mar 31, 2008 -- The Day: Wall Street Helps Finance 'Elite' Pols
By: Dick Ahles

The demise of Bear Stearns leaves Chris Dodd with a small hole in his donor base. The once powerful Wall Street firm was Dodd's third largest contributor during much of his Senate career and the fifth largest donor to his recent campaign for president.

But Chairman Dodd of the Senate Banking Committee needn't despair over dwindling support. He still has Citigroup, Goldman Sachs, Morgan Stanley, Lehman Brothers, Ernst & Young, JP Morgan Chase and others to offer a little help from the industry he oversees.

According to the campaign finance watchdog group, the Center for Responsive Politics, Bear Stearns gave $122,000 to Dodd's brief presidential run and a total of $354,000 to his last three Senate campaigns. You will recall in those campaigns he edged out the less than formidable Brook Johnson, Gary Franks and Jack Orchulli by 31, 36 and 32 percentage points.

Dodd has never been apologetic about taking money from industries he's charged with overseeing. It's the system and he — and we — are stuck with it. The senator explained it all in an interview on the PBS documentary series, "Frontline," in 2004.

"There are issues I agree with them on and I work with them on. I've never had anybody say to me yet, 'By the way, we're going to help you or not help you based on your vote on this issue or the other.' I know there are people who think that way but I've never had that happen in my 24 years here."

But Dodd did come perilously close to crossing the line during his presidential campaign when he scheduled a fundraiser limited to top executives of the equity and mortgage investment units of the largest investment banks just weeks before he was scheduled to introduce mortgage lending legislation that is now before the Senate.

The luncheon was cancelled at the last minute because of a "scheduling conflict," according to a Dodd spokeswoman, but not before "The Hill," a political daily published in Washington, reported campaign reform advocates saw the luncheon invitation as "an unusually systematic way of recruiting fundraisers from a narrow industry sector over which Dodd has power as Banking chairman."

Meredith McGehee, the policy director of the Campaign Legal Center, an advocate for ethics and campaign finance reform, told "The Hill" it would have been difficult for these executives to turn down Dodd's invitation.

"If you're a banker and don't pay attention to the guy who chairs the Banking Committee, you're not carrying out your fiduciary responsibility to your institution," McGehee said. But she didn't fault Dodd because he's "a participant like everyone else in a presidential fund raising environment that needs more regulation."

She's got that right. The banking houses that are the source of much of the economic misery we're currently experiencing were not only generous to the failed candidacy of Chris Dodd. They're heavily invested in the careers of all three frontrunners, Barack Obama, Hillary Clinton and John McCain.

Goldman Sachs, JPMorgan Chase, Citigroup and Morgan Stanley have been among the top 20 contributors to all three senators during their political careers. Goldman Sachs is the biggest donor, ranking first on the list of top contributors to both Obama and Clinton and third to McCain.

Since 1989, Goldman Sachs has contributed $265,000 to Dodd and $211,000 to McCain, but in a shorter period, it has given $535,000 to Obama and $707,000 to Clinton. The other Wall Street firms are not far behind, giving six figures to each of the would-be next presidents.

These firms are dedicated to eliminating what they consider unnecessary regulation of their business affairs. On the same PBS program that had Dodd explaining his support from industries he oversees, the late Walter Wriston, the former president and CEO of Citigroup, referred to regulators as "a certain elite in this country that thinks they're smarter than everybody else and that the average guy needs a lot of help. They think that if it's not regulated, there must be something wrong with it. But as long as you've got competition (the market) regulates itself."

And as long as the "elite" need money to run for Congress and president, corporate contributors will be there to keep regulation from getting out of hand.