The finance industry is reportedly worried about 2016. With more than 1,000 days until that election, it's safe to say that the presidential race's landscape might change, but we feel safe in calling one winner: Wall Street. Big business shouldn't be worried about progressives like Sen. Elizabeth Warren triumphing in 2016. It should be worried about who controls the House after 2014.
Spotted on morning commute: Maryland license plate HLLRY16— David A. Graham (@GrahamDavidA) November 12, 2013
An NBC poll out on Tuesday outlines the if-it-were-today make-up of each party's 2016 field. (Bookmark this: the odds are good that this will be useful in 2017 as a reminder that early polls are useless.) On the Democratic side, the story is all Hillary; she gets two-thirds of support from those who've made up their minds — four times what every other candidate gets, combined. On the Republican side, the story of the moment is Chris Christie: he picks up almost one-third of the party's support. There's more volatility among Republicans than Democrats, given the larger field and given the fluctuations in the 2012. (Reminder: watch the second-by-second changes in the Republican contest!) But if it were held today: Christie versus Clinton — and Clinton wins by 10 points.
What Clinton's doing now is what she tried to do in the run-up to 2008: project inevitability. But this time, she seems actually to be inevitable, barring some massive change.
A story at Politico on Monday suggests that Wall Street, for one, isn't convinced, and that big business worries about the newly-trendy speculation surrounding Warren. The article outlines the reasons why Wall Street wouldn't be happy with a Warren candidacy, the most obvious being she was elected in a heavily Democratic state based on a record of challenging the omnipotence of the financial world. And it articulates why Wall Street likes Clinton, as represented by the quote at left and as manifested in large speakers' fees from Goldman Sachs to the likely candidate.
"The nightmare scenario for banks is to hear [anti-bank] arguments from a candidate on the far left and on the far right," an analyst told Politico. Banks understand that they're not exactly popular, of course, which is why Warren won so handily in the first place.
Big Democratic donors in New York backing a Hillary Clinton candidacy are aware that their support could be a problem and so are reluctant to speak about it publicly.
But privately they yearn for Clinton to get the nomination much in the way many Republican financiers want to see New Jersey Gov. Chris Christie — or someone like him — lock down the GOP nomination instead of tea party favorites such as Paul or Texas Sen. Ted Cruz.
But all of this concern is odd and deeply premature. With Christie and Clinton leading, Wall Street can probably take a deep breath and relax about 2016 for a bit. But that note about Cruz should reveal the real threat to finance: economic disruption from a stagnant Congress.
Cruz and the far-right Tea Partiers in the House shut down the government for more than two weeks and threatened default on the country's debt obligations, a threat only resolved once the markets started to quiver. There is a substantial group of people in the House who have committed to never voting to raise the debt ceiling, which is a decision that carries a much more immediate and demonstrable risk to Wall Street capitalists than three-year-early talk about Elizabeth Warren running for the presidency. (As Slate's Dave Weigel pointed out, Clinton leads Warren in New Hampshire by 53 points.)
On a small scale, Congress has consistently worked to the benefit of business. At New York, Jonathan Chait outlined how lobbyists are controlling a debate over a push from President Obama to rollback tax loopholes, each of which, by itself, is lustily defended by an industry. The link between business and Republicans and moderate Democrats — defined largely by their friendliness to business interests — is well established, and on fights like this, powerful.
In the big picture, there is a substantial threat to business in the idea held by some on the far right that the government has no role to play in the economy or that its investments must be curtailed. Every one of the two dozen-or-so Republicans that called for debt default is up for reelection next year, but it's not clear how Wall Street is mobilizing to oppose them. Last week's House run-off in Alabama showed that business interests were willing to get involved in a House race in order to fend off extremism — but it only ended up with someone who would support a debt limit increase under strict conditions. Hardly a win.
The remarkable thing about the past month is how few people have taken to heart the idea that the power of the presidency pales in comparison to an obstructionist Congress. Granted, House Speaker John Boehner bears some culpability in allowing his most conservative caucus to force the government into shut down. But the idea that Wall Street should focus on 2016, pouring money into a pro-Hillary PAC, seems like precisely the wrong short-term strategy. If anything, Wall Street's 2016 focus should be on bolstering Christie, who's both sympathetic and under threat.
Having learned nothing about its recent brush with disaster, Wall Street seems content to focus on the high-profile, big money presidency. In effect, it's trying to make sure that the plan will land at LAX when its scheduled to, but ignoring the gremlins on the wing.