Wall Street Cuts Campaign Spending to Condemn U.S. Politicians
(Bloomberg) — Wall Street will use the power of its campaign giving to broadly condemn U.S. politicians, including those whose attempt to overturn the November presidential election spurred last week’s attack on the Capitol.
JPMorgan Chase & Co., the largest U.S. bank by assets, said it’s planning a six-month suspension to both Republicans and Democrats, and Citigroup Inc. said it intends to temporarily stop all political contributions this quarter.
“We want you to be assured that we will not support candidates who do not respect the rule of law,” Candi Wolff, Citigroup’s head of global government affairs, said in a memo to employees.
The banking industry has traditionally been among the biggest backers of U.S. politicians, and lenders were some of the top beneficiaries of tax breaks championed by Republicans and President Donald Trump’s administration. The president’s regulators also eased industry rules, and trading desks are expected in coming days to report one of their best quarters ever, despite the tumult in the broader economy brought on by the coronavirus pandemic.
Some of the backlash to the violence singled out Republican Senator Josh Hawley of Missouri, who supported Trump’s claims that his election loss to Biden was the result of fraud. Hawley was seen saluting protesters with a fist pump before they stormed the Capitol on Wednesday. Citigroup’s Wolff said the bank gave $1,000 to his 2019 campaign, adding the New York-based company has a sizable employee presence in Hawley’s home state.
The moves follow a resolution last week by some business leaders to pull back on their financial giving. Tom Glocer, Morgan Stanley’s independent lead director, has been on calls with prominent chief executive officers in recent days in which many resolved to send a message to senators to back off or face financial consequences.
Glocer said he was particularly alarmed by the actions of Hawley, a fellow Yale Law School graduate.
“That drove me beyond the pale,” Glocer said about the senator. “A lot of business people don’t want to get involved because they don’t want to bring politics to the workplace,” he said. “This goes beyond the politics.”
Time to Govern
Peter Scher, JPMorgan’s head of corporate responsibility, said the focus of business, political and civic leaders now should be on governing and getting help to those in need.
“There will be plenty of time for campaigning later,” Scher said in a statement Sunday.
Former Goldman Sachs CEO Lloyd Blankfein took the financial industry to task for failing to speak out sooner against Trump, whose administration juiced Wall Street profits but is now winding down in violence.
“If you are willing to overlook bad character because they do good things for you, then that comes back to bite you,” Blankfein, who retired as Goldman’s CEO in 2018, said in an interview last week. “Trump was doing a lot of good things, but all the while he was showing such poor character.”
Stopping short of vowing to suspend donations, Bank of America Corp. said it will take recent events into consideration before any future donations. Wells Fargo & Co. said it’s reviewing its policies on political giving.
The U.S. stock market rallied toward another record even after the violence, as investors turned their attention from the graphic images of violence to the prospect of more fiscal stimulus under Biden. Banks in particular gained ground, as Goldman Sachs analysts said the industry has “moved back into vogue.”