Wall Street is booming under Trump. But many of its donors are embracing Democrats.
They just want to elect “Democrats to serve as a check” on President Trump.
WHEN CHARLES MYERS, the chairman of a financial advisory firm, hosted four relatively unknown Democratic congressional candidates at his Midtown Manhattan home last month, he netted more money than he can remember collecting from an event that wasn’t headlined by a presidential candidate. “More than ever in my 26-year career on Wall Street, donors are willing to look way beyond concerns of overregulation from Democrats,” said Mr. Myers, a longtime Democratic fund-raiser. They just want to elect “Democrats to serve as a check” on President Trump.
The stock market may be booming. Unemployment is hitting record lows. Republicans pushed through $1.5 trillion in tax cuts. But despite all that, for the first time in a decade, the broader financial community is on pace to give more money to Democratic congressional candidates and incumbents than their Republican counterparts, according to data from the Center for Responsive Politics, a nonpartisan group that tracks campaign donations.
Some of the same grass-roots energy coursing through the Democratic Party — House candidates from Kentucky to Montana to New York are reporting record sums of small donations — has spilled into the corporate boardrooms of American finance, even amid increasingly hostile rhetoric from Democrats in Washington and on the campaign trail toward Wall Street.
“When one party controls all the levers, it is a lot easier for the opposing party to motivate donors,” said Marc Short, the former Trump White House director of legislative affairs, who has deep relationships in the donor world. “It’s both money and activism. But obviously much of the money comes from Wall Street.”
In interviews with two dozen Wall Street executives, fund-raisers, donors and those who raise money from them, Democrats described an extraordinary level of investment and excitement from the finance sector. And many Republicans fretted about a softening of donor enthusiasm — Mr. Short warned of “complacency” — in what has long been one of the party’s most critical and reliable sources of campaign cash.
The numbers are stark. Four years ago, in the last congressional midterm, Republican incumbents and candidates outraised Democratic counterparts by more than $50 million in direct donations from the broader finance, insurance and real estate industries, according to the Center for Responsive Politics. And in 2016 and 2012, Republicans outraised Democrats from that group by nearly $50 million and $100 million respectively, the data show. This year, Democrats held a narrow $5 million advantage through the middle of the year.
That figure will shift, possibly substantially, when candidates reveal their latest fund-raising hauls later this month. But Democrats have already surpassed their 2012 and 2014 totals, and most Republicans with ties to Wall Street described a grim political outlook, even as the confirmation of Brett M. Kavanaugh to the Supreme Court brought renewed energy nationally to their party.
“You’ve got a midterm election coming up that looks right now fairly bleak for the Republicans,” said Stephen Moore, the conservative economist who founded the Club for Growth and maintains close ties to Wall Street donors. “Wall Street is -- and corporate America is -- pretty famous for hedging their bets,” Mr. Moore said. “They just want to follow winners. They just want to make sure they have access to the people who win. This is no exception.”
Some Republicans, including Mr. Moore, cited residual anger from the tax-cut bill, which eliminated a key deduction for state and local taxes in blue states such as New York, New Jersey and Connecticut, where most of Wall Street’s big earners live. Others pointed to Mr. Trump’s personality and his social and cultural agenda that has proved divisive, especially among college-educated voters.
“A lot of Mitt Romney donors are doing nothing,” said one New York financial executive and Republican fund-raiser, who, like many, spoke on condition of anonymity to maintain relationships with contributors. “A lot of these guys just completely disappeared.” Many midlevel donors seem to be simply sitting out this cycle, according to Republican officials; some big contributors have been slower or more reluctant to give ahead of expected losses.
From donors in just the securities and investment sector, Democratic congressional incumbents and candidates have so far received $39.3 million in 2018, compared with $28 million for Republicans. That is a reversal from 2014, when Democrats raised $28 million and Republicans $41.5 million. In 2018, 15 of the top 20 congressional recipients of securities and investment industry cash are Democrats; in 2014, 15 of the top 20 were Republicans. The totals do not include independent super PAC giving; the next round of disclosures, which will run through the end of September, will be released later this month.
Despite the balance sheet shifting to the left, Wall Street remains a wellspring of financial support for Republicans. Political action committee money from Wall Street, which makes up about a third of total giving so far, still tilts Republican. And Stephen A. Schwarzman, the chief executive of the private equity Blackstone Group and an adviser to Mr. Trump, for instance, has already donated $7.25 million to super PACs benefiting House and Senate Republicans.
In September, Jared Kushner, the president’s son-in-law and a senior White House adviser, spoke to a gathering of top Republican Party donors in Manhattan that included some of the billionaire titans of Wall Street. Among them: Joe Ricketts, the founder of TD Ameritrade; Daniel S. Loeb, the hedge fund manager of Third Point L.L.C.; Charles R. Schwab, the founder of Charles Schwab Corporation; and Paul Singer, the hedge fund magnate who runs Elliott Management Corporation. And this month, Speaker Paul Ryan is scheduled to brief a small group of top New York-area donors at the office of Maurice R. Greenberg, the former chief executive of American International Group, according to an invitation obtained by the New York Times.
But some of the industry’s prominent Republican donors have flipped parties entirely, most notably Seth Klarman, a hedge fund manager and former top Republican contributor, who is now pledging to give as much as $20 million to help Democrats in 2018.
Finn Wentworth, the founder of a real estate investment firm and the former chief operating officer of the holding company that owns the New York Yankees, was a fund-raiser for the Republican National Committee as recently as 2016. But he said he has found Mr. Trump’s “lack of empathy for others” to be “distressing” and said he has raised hundreds of thousands for Mikie Sherrill, a Democratic House candidate and Navy veteran in northern New Jersey, who has excited many donors. Mr. Wentworth questioned the deductions provision of the tax bill, among other policies pursued by a Republican-controlled Washington.
“It was almost like the New York metropolitan area -- we had a target on our back,” Mr. Wentworth said.
This year, Democrats in New York and on Wall Street have organized a new effort called the House Victory Project, where “partners” are asked to contribute more than $100,000 to be divided among key battleground House races; three people familiar with the effort said the group has raised more than $10 million. Congressional candidates blessed by the effort are in line to receive as much as $500,000 each.
Giving to once-obscure House candidates is suddenly in vogue, with Democratic donors saying it has never-seen-before cachet in finance circles. “What I have never seen in my lifetime is the level of energy for all these local races,” said Orin Kramer, a veteran Democratic fund-raiser and founder of a hedge fund. “I’ve never seen such an appetite for candidates who people have never heard of.”
“It’s not a matter of degree,” added Mr. Kramer, who has contributed to the House Victory Project and hosted events of his own. “It’s a phenomenon that hasn’t existed before.”
Democrats have cut into the Republicans’ financial edge even as Republicans are still receiving 60 percent of the political action committee cash from the broader financial sector, roughly the same share as past cycles. That means that the industry’s formal lobbying and political arms are still donating to Republicans, while employees and executives are increasingly giving to Democrats.
This year, the American Bankers Association is buying television ads for lawmakers for the first time in its history, supporting eight Republicans and four Democrats. Rob Nichols, the association’s president, called the campaign “rigorously bipartisan,” though all eight Republicans are in contested races, while only one of the Democrats, Senator Jon Tester of Montana, is.
Of course, in the age of super PACs, billionaire donors can still have an outsized impact with a single check. And Mr. Trump can conceivably make up any missing donors on Wall Street with financial support elsewhere, just as he drove different voters to the polls in 2016 as some traditional Republicans stayed home.
The single biggest donor of the cycle is the former New York City mayor Michael R. Bloomberg, who made his multibillion-dollar fortune selling computer terminals to Wall Street. He has pledged $100 million for the Democrats.
The largest Republican contributor is the casino magnate Sheldon Adelson. He and his wife have contributed $55 million to Republican super PACs.
To rally Wall Street support, Republican leaders have been sounding the alarm not just about the broader threat of a Nancy Pelosi-led House, but specifically about who is in line to chair the powerful Financial Services Committee: Representative Maxine Waters of California, a liberal firebrand whom Mr. Trump has also taken to attacking by name.
“Finance people -- when they find out that Maxine Waters is going to be in charge of finance -- they panic,” said John Catsimatidis, a billionaire Trump donor in New York, who was one of the few who said he said he saw no softening among Republican donor interest on Wall Street. Last month, when Mr. Ryan briefed members of the U.S. Chamber of Commerce about the stakes of the election and the regulations that Democratic control could unleash, he name-checked potential Democratic committee chairs, including Ms. Waters, according to two attendees.
For Democrats, Mr. Trump himself has proved a unifying message when seeking out financial industry contributors.
“You would expect, with the economy doing as well as it is today, that there would be a desire to keep the status quo,” said Thomas R. Nides, a former adviser to Hillary Clinton now working on Wall Street. But he said, “I don’t think people care. They’re worried about the direction of the country.”
https://www.nytimes.com/2018/10/07/us/p ... 3965451008