The Clintons Made Wall Street Richer, and It Returned the Favor
Late at the end of last week, the Clinton campaign sent its long-awaited personal financial disclosures to select media outlets. From the perspective of the campaign, it was a clever move; by sending their disclosures to the media first before sending them to the Federal Election Commission, they essentially controlled the timing of the stories about their income for the past year and a half.
The disclosures detail the incomes of both Clintons going back to 2014. From what was offered to the press, we know that in less than a year and a half, the Clintons raked in over $30 million, the vast majority from speaking fees they charged to foreign and domestic corporations and other organizations willing to pay speech honorariums.
The bulk of the reporting on this matter has focused on the amount of money the Clintons earned. “The report underscores how much wealth the Clintons continued to amass as the Secretary of State prepared to launch her second bid for the presidency,” concluded USA Today. But the bigger story is why the Clintons are so rich. Their wealth is derived from an army of corporations that benefited from the very laws the Clintons passed, and now they are returning the favors. Although corporations from every sector of the economy developed this symbiotic relationship with the Clintons, none is more prominent than Wall Street.
Making Wall Street Richer
In 1999, President Bill Clinton rallied allies in Congress to pass the Financial Services Modernization Act, which repealed the Depression-Era Glass Steagall law separating commercial and investment banking. The result was a spree of mergers and growth that involved a huge growth in the size of the nation's biggest banks and their profits.
Clinton's Treasury chief, Robert Rubin, was soon hired to become an executive at Wall Street megabank Citigroup, pulling in $115 million in pay from 1999 to 2008. But the next beneficiary of Wall Street was the Clintons themselves.
It wasn't long after the Clinton presidency ended that the Clinton speech circuit began. Because spousal income is shared, Senator Hillary Clinton (D-NY) was required to disclose her husband's many paid speaking engagements. A month after leaving office, Bill Clinton gave a speech to Morgan Stanley for $125,000, which advocated for the Wall Street deregulation. He spoke to another financial firm, Credit Suisse First Boston, which paid him the same amount.
As Bill Clinton traveled across the United States and the globe speaking to financial firms and others paying top dollar, his wife was in Washington deciding on matters these institutions had interests in. In 2001, Senator Clinton backed a bankruptcy bill that made it much harder for people to qualify for Chapter 7 bankruptcy; the bill was primarily supported by banks and credit card issuers. Recall that Senator Elizabeth Warren (D-MA)— then a consumer advocate and law professor—thoroughly briefed First Lady Hillary Clinton on the impacts of the bill just a few years earlier. According to Warren, her testimony turned Clinton against the bill. However, once the financial industry started pouring funds into the Clintons' bank account, that opposition disappeared.
Over the years Hillary Clinton was in the Senate, the financial industry paid millions of dollars to the couple's shared bank account. In 2004, Bill Clinton was paid a quarter million dollars to speak to Citigroup in Paris; the same year, Goldman Sachs paid him $125,000 for an address in New York City. The following year, Goldman paid him $125,000 for a speech in South Carolina, a quarter million to speak in Paris and $150,000 to speak in Greensboro, Georgia. This is just a small snippet of what the Clintons were paid.
In 2008, after the conclusion of her failed first run for the presidency, Senator Clinton continued to advocate for Wall Street. She appeared on national television to advocate for the financial bailout package that progressive leaders like senators Russ Feingold (D-WI) and Bernie Sanders (I-VT) opposed. She cautioned against over-regulating, telling MSNBC hosts that “we seem in America to go from one end of the spectrum to the other, we're bouncing around like some pendulum instead of trying to stay in the center, be pragmatic, come up with solutions that work.”
Hillary Hits the Lecture Circuit
As Secretary Clinton presided over our nation's foreign policy, her husband continued to rake in millions of dollars for the couple from domestic and foreign corporations. In particular, foreign firms in favor of the Trans-Pacific Partnership paid her husband $1.5 million.
After departing the State Department, Hillary decided to join the lecture circuit herself. Although we don't have any comprehensive financial disclosures for 2013, it is telling that two of her first addresses were for the Goldman Sachs megabank, where she reportedly earned $200,000 per address.
In 2014, the year Clinton was elevated to an all-but-certain presidential candidate, the power couple brought in enormous amounts of money from Wall Street. Bill Clinton gave an address to Bank of America in London that netted $500,000. Recall that this was a bank that netted $45 billion from taxpayers, thanks to a bailout package Hillary supported. That's an 8,999,990 percent return on investment.
The Clintons made the financial sector even richer, and in return, the financial sector made the Clintons go from being in debt when they lived in the White House to being in the top .01% of all American income earners. From deregulation of the big banks, to tightening personal bankruptcy laws, to supporting unfair and unfettered bailouts, the Clintons, to steal a phrase from Donna Summer, “worked hard for the money.”
Yet Wall Street needs to ensure that the symbiotic relationship continues by bringing the Clintons back into power. That can't be done by paying large speaking fees alone.
Although Hillary has been cast in the media as running to the left by altering her previous positions on an array of social issues, her fundraising base is virtually the same as in 2008. In 2008, one of her first financiers was Alan Patricoff, a private equity kingpin who was critical of government regulations put in place after the Enron scandal. This year, Patricof is again a fundraiser for Hillary Clinton. While she talks about representing “everyday Americans,” it is estimated she raised a million dollars from just three fundraisers in New York City, one of them at the home of Steve Rattner, a financier who had to pay $10 million as part of a settlement related to kickbacks (he also campaigns to cut Social Security and Medicare).
In contrast, Bernie Sanders is said to have raised $4 million from a total of 100,000 donors. Sanders opposed the deregulation of Wall Street and the bailouts. He can't call a group of Wall Street friends and raise a million dollars in a weekend from enough people to fill three rooms.
The symbiotic relationship between the Clintons and high finance exists because America is a country where anybody can make it, if they just decide to help make the rich richer. The question is, where does this relationship leave the rest of us?