TARP Bailed Out Companies Fund Candidates

" A hypocrite despises those whom he

deceives, but has no respect for himself.

He would make a dupe of himself too,

if he could." 

(William Hazlitt)

By T. W. Farnham

Washington Post Staff Writer
Sunday, October 24, 2010; 10:02 PM

Senate Minority Leader Mitch McConnell (Ky.) was a fierce critic of the federal bailout of General Motors and Chrysler last year, saying he could not "ask the American taxpayer to subsidize failure."

But GM doesn't seem to hold a grudge.

The political action committee formed by the company, which is now largely owned by taxpayers, cut McConnell a $5,000 campaign check in September, a small piece of the $190,000 it donated to campaigns in the past month.

Although GM suspended its contributions while it solicited the government for financial help, it is now back in the game of political giving, increasing donations from its federal PAC steadily over the past few months.

It is not alone: Companies that received federal bailout money, including some that still owe money to the government, are giving to political candidates with vigor. Among companies with PACs, the 23 that received $1 billion or more in federal money through the Troubled Assets Relief Program (TARP) gave a total of $1.4 million to candidates in September, up from $466,000 the month before.

Most of those donations are going to Republican candidates, although the TARP program was approved primarily with Democratic support. President Obama expanded it to cover GM and other automakers.

Greg Martin, a GM spokesman, said that the company's PAC donations come from voluntary contributions from its employees. "We contribute to candidates who thoughtfully approach issues that are important to the auto industry and manufacturing," he said. "If you look at our giving, we have given equally to both parties' leadership."

Some of the generosity to Republicans can be explained by the expectation that the party will make huge gains in Congress. But another factor is the Democratic Party's push for financial-regulation legislation this year. The new law, which passed the Senate with the votes of three Republicans and all but one Democrat, placed new curbs on banks and introduced a regulator to vet financial products for consumers. Most Republicans, and banks, say the law creates too many new restrictions.

Scott Talbott, a lobbyist with the Financial Services Roundtable, said another factor could be the tone some Democrats used against financial firms. At one point, Obama called Wall Street executives "fat cats."

"The entire industry was painted with a broad brush, and there was dissatisfaction with that," Talbott said.

Democrats have been abandoned by individual Wall Street donors as well as corporate PACs, leaving the party without an important source of funding as it fends off aggressive Republican challengers.

One company that used TARP funds to invest in toxic assets from other banks is getting into the political giving mode for the first time. The investment fund BlackRock created a federal PAC in March, only a few months after the company used $2 billion in government money to invest in those assets. Its newly formed PAC has cut campaign checks to federal lawmakers including Rep. Barney Frank (D.-Mass.), the chairman of the House Financial Services Committee.

More on hypocritical Politicians

The Barney Frank's Campaign Contribution Shuffle rakes in $40,000 from bailed out banks

In a statement last night, a Frank spokesman said the congressman

has declined to take contributions only from the top 10 TARP

recipients, but he noted he would accept donations from those

institutions once they repaid their debts.

By Dave Wedge
Boston Herald
10/22/10
U.S. Rep. Barney Frank, in an intensifying clash with GOP upstart Sean Bielat, has pledged not to take campaign cash from lenders that got federal bailouts — yet has raked in more than $40,000 from bank execs and special interests connected to the staggering government loans, a Herald review found.

Frank vowed in February 2009 that he wouldn’t accept campaign donations from banks that received money under the $700 billion Troubled Asset Relief Program (TARP) or political action committees tied to such institutions.

But Frank has hauled in thousands from top execs at Bank of America, Citizens Bank, Wainwright Bank, JP Morgan Chase and other institutions that received billions in TARP money.

Just yesterday, Frank made new campaign finance disclosures showing he received $17,000 from top executives of Bank of America — including $2,000 from CEO Brian Moynihan. B of A received $45 billion in bailout money. In all, Frank has hauled in at least $27,000 since 2009 from bank execs — and $13,000 from PACs — connected to banks that received TARP funding, including:

• $5,000 earlier this month from the Bank of America Corp. Federal PAC;
• $10,000 in August and September from the Bipartisan PAC/ Bank of New York Mellon Corp.; Mellon received $3 billion from TARP;
• $2,000 in June 2009 from the Financial Services Roundtable PAC, which counts TARP recipients B of A, JP Morgan Chase and Wells Fargo among its members; and
• $1,000 in March from U.S. Bancorp PAC; the Minnesota-based bank received more than $6 billion in TARP funds.

“Now that he’s in the political fight of his life, Barney Frank tossed aside his phony pledge and lined his pockets with cash from his closest allies — Wall Street executives,” said National Republican Congressional Committee spokesman Tory Mazzola. “He made a promise to voters, but obviously he cares more about saving his career as a politician than with keeping his word.”

In a statement last night, a Frank spokesman said the congressman has declined to take contributions only from the top 10 TARP recipients, but he noted he would accept donations from those institutions once they repaid their debts.

Meanwhile, in a release responding to a Herald report yesterday that Bielat is tapping Wall Street bigwigs in a bid to force Frank into a Martha Coakley-style collapse, Frank said, “Mr. Bielat’s eagerness to serve as the agent of those wealthy Wall Streeters who seek to undo the financial reform bill explains why this race has become so expensive and why it is so important in order to prevent another economic crisis.”

The 15-term Democratic congressman has scrambled to stem the surging Bielat, pumping $200,000 of his own cash into his campaign. New filings show Frank has shelled out $700,000 in the first two weeks of October and has $650,000 to Bielat’s $420,000. Bielat, a 35-year-old Marine, reported he has raised $650,000 so far in October, records show.

In a Feb. 23, 2009, article in the Washington publication Roll Call, Frank is quoted saying, “I won’t take any PAC money from banks that took TARP funds, nor would I take it from the top executive.” The article made no mention of the policy only applying to the top 10 TARP fund recipients. Frank said he floated the loan to his campaign to counter an expected flood of right-wing attack ads, including from the national Tea Party

A Trip Down Memory Lane Courtesy of:

Open Secrets.org (Center for Responsive Politics)

Lindsay Renick Mayer

February 10, 2009

The eight financial institutions at Wednesday's hearing have given $63,250 to the chairman of the committee, Rep. Barney Frank (D-Mass.), and JPMorgan has given him more money than any other company, union or organization since 1989. The House Financial Services Committee has jurisdiction over the housing and financial sectors. Complete article