TEXT OF INTERVIEW
Kai Ryssdal: There’s a primary in Pennsylvania today you might have heard something about. The Democratic nomination might be sewed up in a couple of hours — or it might not.
One thing that’s not going to end is the money race and I’m not talking just about the campaign trail here, either. Contributions continue to grease the political skids in Washington. From some unlikely donors, too.
Jeanne Cummings covers money and politics for Politico. She says some of the key players in the subprime mess have scraped together enough loose change to lobby for their causes:
Jeanne Cummings: Bear Stearns was in fact a very good giver. Citigroup is an excellent giver. Many of the big companies that are up on Wall Street that have been caught up in the mess are major donors to members of Congress and to the presidential candidates.
Ryssdal: When you say major, how much money in the aggregate are we talking about here?
Cummings: You could see hundreds of thousands of dollars come out of these particular companies if you combine both the giving by their executives and also those that have PACs.
Ryssdal: PACs of course being Political Action Committees, these groups that control money and can spend it in certain limited ways.
Cummings: Yes, that’s right.
Ryssdal: What about lobbyists? Your reporting shows that lobbyists aren’t doing too badly for themselves with some of these donations?
Cummings: That’s right. I checked the lobbying for the affected industries, for example, banking and the securities and financial services, but what was very intriguing as well was I went and I took a look at hedge funds, for instance. You know, they’ve never been regulated before and suddenly, they are in the mix. They have already exceeded the amount of money they gave in the last presidential cycle, and in this case, we’re talking about sums that go from $4 million during the last midterm races in 2006 to more than $8 million and we’re not even done yet.
Ryssdal: I don’t want to sound naive here, but what on earth could they be lobbying for?
Cummings: You know, there’s nothing like voters in dire straits to motivate members of Congress to suddenly pass legislation. If you look at the homeowner situation, the mortgage foreclosure mess, we had the first bailout plan, the economic stimulus plan go through and now they’re working on a second one that is much more geared to the homeowners themselves. So there you have the real estate companies are involved, you have banks involved, you have construction companies involved, cement makers, brick makers and then you have your consumer groups. Now later this summer, we may see legislation regarding credit cards because they now are starting to tank as well. There you’re going to see banks back in, credit card companies — Visa, MasterCard, they’re all gearing up for a big fight — and then you look at another round of legislation that could come later, which is how do we re-orient our entire regulatory system for Wall Street so that we’re never in this position again. Well that’s when the hedge funds weigh in.
Ryssdal: The thing is though, Jean, that these companies are reporting billions of dollars worth of losses and yet somehow, they still find this money?
Cummings: Well, absolutely. There’s always some money that they can find to spend and when you look at how much money some of these institutions make, the amount of money that they give to Washington from that perspective is not all that big, but down here in Washington, it can go a long way. So if you’re looking at, say, the hedge funds, they throw $8 million at Washington. To them it’s like a quarter.
Ryssdal: Jeanne Cummings covers politics for Politico. Jean, thanks so much for your time.
Cummings: You’re quite welcome.
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.