Money Cow Finance Panel Helps U.s. Lawmakers In Tight Races
Newer members, Republican and Democratic, are finding it is easier to take in campaign money from finance, real-estate and insurance political action committees now that they are incumbents. Those industries donated at least $483,203 to the 14 freshmen members of the House Financial Services Committee in the first quarter, according to reports filed this week. Thats more than three-quarters of the $632,237 the members collected from the industry during their entire campaigns.
Party leaders assigned 11 of the 24 freshmen who won their seats by the narrowest margins to the financial services panel. Now, as they consider the broadest rewrite of financial rules in decades, those members are getting money from donors such as the American Bankers Association, Citigroup Inc. and Visa Inc.
“Committees that govern Wall Street and banking are considered cash-cow committees,” said Sheila Krumholz, director of the Center for Responsive Politics, a nonpartisan Washington research group. “Landing a seat on this committee provides a way to secure easy re-election fundraising.”
One example is Representative Leonard Lance, a New Jersey Republican who won his first term in Congress with just over half the vote. In the first quarter, Lance took in more than $55,000 from financial, real-estate and insurance PACs. During the last two years, he got only $34,500 from those financial interests, according to the Center for Responsive Politics.
Critical of Citigroup
Like many members of Congress, Lance has at times been critical of the financial industry. While he said a congressional proposal to restrict executive compensation at all companies receiving government bailout money was “too broad, too ambiguous” and raised “too many questions,” he introduced legislation to block bonuses to executives at New York-based American International Group Inc.
In March, Lance posted a letter to Citigroup Chief Executive Officer Vikram Pandit on his Web site that said the New York banks $10 million plan to refurbish its Park Avenue offices rose “to the same level of abusing the privilege of taxpayer assistance” as the AIG bonuses. Citigroups PAC had donated $2,000 to Lances campaign just days before.
Citigroup officials didnt return a call seeking comment.
Spreading Donations
The financial industry gave money to freshmen in both parties on the House committee run by Massachusetts Democrat Barney Frank. The two biggest recipients were Democrats Dan Maffei of New York and Jim Himes of Connecticut, whose home states contain the headquarters of many of the biggest financial firms.
Maffei received $71,174 in PAC donations from the financial, insurance and real-estate industries during the quarter after getting $107,500 from the group during the last two-year election cycle. Himes got $61,789 from those PACs in the last three months, up from just $20,500 in the campaign.
Maffeis chief of staff, Daniel Krupnick, said his boss had a strong “all-around” quarter raising money. “There is always a clear line between his legislative decisions and fundraising,” Krupnick said.
Freshmen Gains
All the freshmen on the panel saw giving from the financial industry climb as a percentage of their overall PAC donations.
Representative Lynn Jenkins, a Kansas Republican, got more than a third of her PAC donations from the group, or $33,566. Thats up from a fifth of PAC contributions during the campaign. Jenkins called for the government to recoup AIG bonuses, yet opposed a plan to institute a retroactive tax, saying it “sets a dangerous precedent.”
Representative Gary Peters, a Michigan Democrat, received $38,656 from the group of financial PACs in the first quarter, up from $29,250 during the campaign. The industry accounted for more than a fifth of his PAC donations, up from 3.9 percent in the campaign.
“No one has been tougher on the financial sector than Congressman Peters,” said Cullen Schwarz, his communications director, pointing to actions Peters has taken such as helping lead the effort to recoup AIG bonuses. Peters also called on Citigroup, Goldman Sachs Group Inc., JPMorgan Chase & Co. and Morgan Stanley to extinguish a substantial part of the debt they held in automaker Chrysler LLC.
Officials in the offices of Lance, Himes and Jenkins didnt have any immediate comment.