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Wednesday, October 14, 2015

'The Waaaaah Street Factor'

101415krugman2-tmagArticlePaul Krugman notes the correlation between getting tough on the financial industry and the flow of campaign cash. Some people argue this money doesn't much matter in terms of influencing elections, but the people giving it -- the ones so lauded on the political right for their wisdom on business and financial matters -- sure seem to think it does:

The Waaaaah Street Factor: Following up on my point about how this is looking like a Dodd-Frank election: to understand what’s going on this election cycle, you really need to know about the dramatic shift in Wall Street’s political preferences.
There was a time when Wall Street was quite favorable to Democrats. ...
But that all changed in 2010, when Democrats actually pushed through a significant although far from adequate financial reform, and Barack Obama said the obvious, that some financial types had behaved badly and helped cause the crisis. The result was a great freakout — the coming of “Obama rage”.
Wall Street doesn’t like the regulations, which really do seem to have more or less eliminated the implicit too-big-to-fail subsidy. Beyond that, with great wealth comes great pettiness: financial tycoons are accustomed to constant deference, and they went berserk at even the mild criticism they faced.
You can see the result in the chart: a drastic shift of campaign giving away from Democrats toward Republicans. And this will have consequences: if a Republican wins, he or she will be very much in Wall Street’s pocket. If a Democrat wins, not so much.

    Posted by on Wednesday, October 14, 2015 at 11:36 AM in Economics, Politics | Permalink  Comments (24)


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