If U.S. President Barack Obama is serious about bringing his country's big banks to heel, he will be embarking on a very courageous political act indeed. He will be biting the hand that feeds him. In the 2008 presidential election he, like his opponent John McCain, got well over a third of his campaign funding from the financial industry.
In this year's congressional elections, candidates will be heavily dependent upon the banks for campaign dollars. And with the recent U.S. Supreme Court ruling that allows corporations to donate without limit, supporters of Obama's policies could be facing a veritable flood of corporate money. And then of course there is the bankers' lobbying machine with 1,500 lobbyists in Washington, three for every member of Congress, to drive home the reality of American politics in the 21st century. Congressmen and women will eventually have to approve Obama's measures and the lobbyists will make it very clear what the price of that approval would be.
It will certainly be clear to the Democratic head of the Senate's powerful banking committee, Chris Dodd. In the last four years, financial companies have provided the good senator with $8-million in campaign contributions. He is retiring at the end of this year, but it's unlikely he will forget who his friends are.
So I'm betting on the banks. As Democratic Senator Dick Durbin said last year about the banking industry's Washington lobby, "They own the place." Still, it's a gutsy move on Obama's part, and if he can somehow get anything substantial through Congress, it will be a great victory for the American people, both politically and economically.
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