With the Obama administration pushing for financial reforms, and the SEC having gone after Goldman Sachs for allegedly favoring a hedge fund client, the spotlight is on New York Senator Charles Schumer.
Schumer has been a champion of Wall Street financial firms for years, particularly hedge funds, yet now is holding himself out as a reformer.
It was Schumer who helped organize hedge fund lobbying efforts and campaign contributions, as reported by the NY Times on March 13, 2007:
On a cold evening in late January, Senator Charles E. Schumer invited a who’s who of hedge funds to dinner at Bottega del Vino on the Upper East Side of Manhattan. More than $100 billion worth of wealth sat around the table, including Paul Tudor Jones of Tudor Capital; Steven Cohen of SAC Capital; Stanley Druckenmiller of Duquesne Capital; and James Chanos of Kynikos Capital, according to a person who was briefed on the dinner.
Mr. Schumer, the New York Democrat, had some simple advice for the billionaires in his midst: If you want Washington to work with you, you had better work better with one another.
Other resources on Schumer’s long-term and tight connection to the hedge fund industry, including massive campaign fundraising efforts for the Democratic Party, include:
- Hedge Funds, Buyout Firms Favor Democrats With Campaign Money, August 14, 2006
- For Schumer, the Double-Edged Sword of Cozying Up to Hedge Funds, June 22, 2007
- In Opposing [Hedge Fund] Tax Plan, Schumer Breaks With Party, July 30, 2007
- Schumer and the hedge fund lobbyists, July 7, 2009
- Goldman suit figure touted, fundraised for ally Schumer, April 16, 2010
Now Schumer is holding himself out as a leader in the effort to reform Wall Street as part of the effort by Democrats to raise a populist argument in the run-up to the November elections.
Expect Schumer publicly to treat his former Wall Street friends the way he treated a flight attendant, now that the spotlight is on the money shoved deep into his and other Democrats’ pockets for years.
Privately, Schumer will see to it that the “reforms” are for show only, so that he can go back to the Wall Street fundraising well again and again and again.
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