Hillary Clinton
continues to struggle on the left with criticism that she is too close
to Wall Street and would not do enough to rein in the nation's largest
banks. And now she is rolling out a new defense, saying she is just like
President Barack Obama , who took a lot of Wall Street money in 2008.
It's a risky strategy that liberal Democrats so far aren't exactly buying.
The new defense was on display in Sunday night's Democratic debate when Bernie Sanders ripped Clinton for taking money for her campaign from big banks and getting "personal speaking fees from Goldman Sachs (NYSE: GS)."
Clinton fired back that there was "no daylight" between her and
Sanders on regulating Wall Street, saying "there should be no bank too
big to fail and no individual too powerful to jail."
Then
she pulled out the Obama card: "But where we disagree is the comments
that Senator Sanders has made that don't just affect me, I can take
that, but he's criticized President Obama for taking donations from Wall
Street, and President Obama has led our country out of the great
recession," Clinton said. "I'm going to defend President Obama for
taking on Wall Street, taking on the financial industry and getting
results."
In some
respects, it's a shrewd strategy. Obama's national poll numbers are
terrible, but he is still very popular among activist Democrats likely
to vote in primaries. He is especially popular with African-American
Democrats who Clinton will need in large numbers when the nominating
contest turns to South Carolina and other Southern states after Iowa and
New Hampshire.
If Clinton
winds up losing Iowa and New Hampshire to Sanders — a real possibility —
she will need a Southern fire wall to stop the Vermont senator's
momentum. Casting Sanders as an Obama basher (even though he really
isn't one) could certainly help Clinton roll up delegates after the
first two nominating contests.
But it could also backfire because it is far from a perfect
comparison. While it is true that Obama took a lot of Wall Street cash
in 2008 — around $16 million, outpacing his GOP rival Sen. John McCain —
he has not taken millions of dollars in speaking fees from the likes of
Goldman Sachs and others, as Clinton has.
One Democratic operative working for a rival campaign emailed me
regarding Clinton's latest attempt to beat back the Wall Street attack:
"This is the sixth defense [Clinton] is trying out: An economic speech
on capital gains will give me cover; Anyone who knows me knows I don't
listen to donors; 9/11 endeared me to Wall Street; I went to Wall Street
and told them to cut it out; I have a better plan than my opponents;
President Obama took donations from Wall Street, too," this person said.
"The problem is you can't really equate campaign contributions with
personal income. There's quite a difference between receiving donations
from Wall Street and personally profiting from it — though she's done
both."
There is another
problem with Clinton's "I'm just like Obama" defense on Wall Street: The
president's record on dealing with the financial industry is not
universally loved on the left. Many progressive Democrats remain both
unsatisfied that the Dodd-Frank
financial reform law did not do more to break up the biggest banks and
outraged that no senior Wall Street executives were prosecuted
following the financial crisis.
A second Democratic operative not aligned with any campaign emailed:
"When do you think the Wall Street-friendly Democratic elites that have
dominated the party since the first Clinton Administration are going to
accept the fact that the polling consistently shows Bernie doing better
in a general election than their preferred pick? Will they stick with
Clinton even if it means blowing a chance to win the real prize? Smart
money parlay is on 'never' and 'yes,'" this person said. "Clinton is now
clearly running on Obama's legacy. That may work in some policy areas
(like guns), but this may backfire on Wall Street regulation. Rightly or
wrongly, President Obama is still stained by the bailouts and the
inexplicable failure to prosecute really any leading bank executives as
part of the crisis."
Clinton is moving on to the Obama defense in part because her "my plan
is better" approach, while possibly correct, is a much tougher sell
among liberals not especially interested in nuance when it comes to Wall
Street reform.
Clinton
has argued that a blunt approach that would break up banks based mainly
on size rather than risk would not make a great deal of sense. She
would use a relatively complex set of proposals to rein in Wall Street
rather than simply breaking up the biggest banks as Sanders has promised
to do.
"I have a risk-oriented approach that goes much further than reinstating Glass-Steagall," Clinton said in New Hampshire last month. "Now, it will take a little while longer to explain it."
That last sentence represents her biggest problem. Targeting risk
rather than size is a very appealing approach to policy wonks. But it
does not exactly fire up the pitchfork-wielding activists who want the
biggest banks smashed and executives led away in handcuffs.
And now Clinton is expecting voters to recoil at Sanders' implied
criticism of Obama even though the president never gave big ticket
speeches to banks and saw his Wall Street financial support plunge in
2012 following implementation of Dodd-Frank.
It could wind up working. But it's a better bet that Clinton will
simply take her lumps over her ties to Wall Street and go on to win the
nomination anyway.
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