[lbo-talk] Schumer as bagman

Doug Henwood dhenwood at panix.com
Sat Oct 7 08:50:27 PDT 2006


Financial Times - October 4, 2006

Schumer sweats his Wall Street ties to fill war chest By Stephanie Kirchgaessner

It is often said in Washington that the most dangerous place to stand is between Senator Chuck Schumer and a microphone. But it is an adage that does not seem to ring true these days.

In fact, for Republicans battling to hold on to their majority in the Congress, this election cycle has proved that the New York Democrat's sharp tongue and insatiable appetite for media attention are not nearly as dangerous as his lethal ties to Wall Street.

Most Democrats have set their hopes on wresting back control of the House of Representatives this November. But Mr Schumer's fundraising efforts as chairman of the Democratic Senatorial Campaign Commission (DSCC), and improving prospects in a handful of Senate races, have some Democrats believing that a narrow Senate victory is in reach.

The support of Democratic donors from New York, particularly Wall Street, has been key to Mr Schumer's success. Of the $81.3m (€64m, £43.3m) he has helped raise - $12m more than Senator Elizabeth Dole, his Republican counterpart - roughly 18 per cent has been donated by New Yorkers, making it the most lucrative donor base. That compares with 9 per cent in 2002, during the last midterm election cycle, when Washington DC held the top spot.

"We have had a lot of DSCC chairs over the years - some have been better than others. Chuck is certainly among the best: the energy and drive and leveraging of his relationships is quite extraordinary - all you have to do is look at the numbers," says Steven Rattner, a Democratic donor and principal of Quadrangle Group, the private equity firm.

It is difficult to compare current and previous election cycle fundraising statistics because of changes in campaign finance laws enacted in 2002. However, figures compiled by the Center for Responsive Politics show a significant increase in the amount individuals from some Wall Street banks have donated to the DSCC under Mr Schumer's watch. Some examples include Goldman Sachs, where individuals have donated $512,000 to the DSCC in this cycle compared with $125,832 during the last midterm election in 2002; Citibank employees have individually given eight times more to the DSCC over the past two years than they did in 2002, or about $228,701.

"I know a lot of people who are giving the maximum, or people who haven't given before. In NY, it helps that it's him - people know him and like him, and it's harder to say no when he makes an appeal," said one Wall Street donor.

Heather Podesta, a lobbyist and Democratic fundraiser, says Mr Schumer has differentiated himself by showing "tough love" to candidates, avoiding long-shots and personal favourites and narrowing in on races that Democrats believe are winnable: Virginia, Missouri, Ohio, Rhode Island, Montana and Pennsylvania.

"If we pick up four seats, Chuck Schumer is a hero. If we pick up six, he has God-like status," she says, hinting, too, at Mr Schumer's more ruthless side. "He is grateful but he pushes. He pushes donors, he pushes fundraisers, he does it only as a New Yorker can. It is matter-of-fact, it is to the point. And it gets done."

Mr Schumer's ties to the business community go beyond his home address: the veteran lawmaker sits on the banking and finance committees - a point not lost on some who analyse his fundraising prowess.

"In terms of the financial institutions, [donating to the DSCC] is a twofer [bonus]. Schumer is a noted fundraiser in his own right; if you can be responsive to a solicitation, you are really getting an extra bang for your buck," says Kenneth Gross, an attorney at Skadden Arps who advises on campaign finance issues. While supporters of the senator say he is liked by the business community because he is responsive to Wall Street, they also acknowledge he is not always on the "right" side of business.

Earlier this year Mr Schumer played a key role in orchestrating the backlash against the sale of US port terminals to Dubai Ports World. Although his campaign scored Democrats significant political points by portraying the White House as weak on national security and, some critics say, exploiting anti-Arab sentiment, business groups were aghast - and rattled - by the politicisation of the deal.

Even Democrats who disagree with Mr Schumer on the ports issue, as well as his stance on trade, however, recognise that for the New York senator, some political opportunities outweigh risks to the business community.

"Frankly, how can you argue with the politics of it?" says one Democratic donor. "If we do well in November, he deserves more than his share of credit. He is certainly pulling his weight, and more."



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