The election season is in full swing in 2016 – a year which is proving to be one of the most divisive in American political history. And one issue causing much discord within both parties concerns the influence of money in politics. On one hand, Donald Trump boasts of maintaining a self-funded campaign. And on the other hand, Bernie Sanders accuses Hillary Clinton of borrowing big bucks from the financial sector.
The popular support for both candidates can be interpreted as a sign of the public’s desire for lessening Wall Street’s monetary influence in political campaigns. But all this gives rise to a critical question. Did the political rhetoric lead to a decrease in Wall Street funding in the 2016 presidential elections?
Short answer, it didn’t.
In fact, the effect was quite the opposite. As Fortune’s Ben Geier puts it,
Despite bitter criticism, many candidates continue to draw a good chunk of their campaign finances from Wall Street. The list prominently includes – among others – Hillary Clinton, Ted Cruz, and the now suspended campaigns of Marco Rubio and Jeb Bush. The overall sway that the financial sector holds over the election cycle becomes increasingly clear when we take one good look at the numbers.
According to a Wall Street Journal report, the Political Action Committees (also known as Super PACs) drew more than one-third of their finances from Wall Street executives. Many campaigns depend on funding from these super PACs which can receive money from the corporate sector more freely than politicians. If we compare these figures with statistics from the previous presidential elections, the trend becomes increasingly clear.
Wall Street donations consisted of almost 20 percent of the total money ($845 million to be precise) that the super PACs raised in 2012. And if we go back to 2004, we see that the financial sector raised only $2.4 million – a relatively tiny amount compared to today. So the picture becomes increasingly clear. Despite the increasing public awareness about the influence of money in politics, Wall Street continues to exercise considerable financial control in the 2016 election cycle.
In just 2015, Wall Street executives donated more than $100 million dollars to the super PACs and, by extension, the political candidates. These are the findings of the non-partisan organization, the Center for Responsive Politics.
But what exactly is the source of all this money? Who, in Wall Street, is primarily responsible for the donations? That is the question. And Sheila Krumholz, the executive director of the organization, has an answer. Contrary to what one might think, corporate funds from big firms like JP Morgan and Goldman Sachs are not the major source of the donations.
According to Krumholz, those individuals include both billionaire executives and employees of the financial sector.
It is ironic that, despite of their continuous reliance on Wall Street funding, presidential candidates from both parties vow to take on the big banks and corporations, if elected. Whether the public outcry will lead to a decrease in the influence of Wall Street in politics in the coming years remains to be seen.