WASHINGTON -- After a year of being pilloried and persecuted in Congress, many of Wall Street's donors have ended their rocky, odd-couple relationship with the Democrats and closed their checkbooks.
The news that a growing number of Wall Street fat cats are no longer giving money to the Democratic House and Senate campaign committees is the latest in a lengthening saga of bad news for the Democrats who face what could be catastrophic losses in the midterm elections.
Since the 2008 election, Wall Street tycoons who helped elect Barack Obama and bankrolled the Democrats' gains in Congress have become the Democratic party's and the president's favorite whipping boys. The financial industry was to blame for the subprime mortgage catastrophe. It was responsible for the recession. It bore the blame for the collapse of major financial institutions.
In all of Barack Obama's campaign speeches, you would have to search high and low to find him blaming buyers who bought a home that was beyond their means, buyers who made no down payment or buyers who lied about their income. He never blamed the reckless use of adjustable-rate mortgages that contained interest rates that would soon be beyond their means. You won't find any evidence of Obama pointing the finger of blame at the two corrupt government mortgage giants, Fannie Mae or Freddie Mac, who bear much of the blame for the subprime scandal that has cost taxpayers untold billions of dollars in bailouts that will never be repaid.
Democratic leaders in Congress were equally myopic about the mortgage scandal, blaming it almost wholly on Wall Street, the one sector of the economy that had long eluded their efforts to engulf it in a thick web of suffocating government regulations.
Now the Democrats are on the brink of achieving their long-sought goal in the financial regulatory reform bill, which will create a powerful new federal agency with free rein to impose whatever regulations it deems necessary -- plunging the markets into uncertainty and fear.
That was the last straw for many Wall Street donors who had fattened his campaign with tens of millions of dollars in contributions, and have been a major funding source for the Democratic Senatorial Campaign Committee and Congressional Campaign Committee. The money flow has dropped significantly, according to a fundraising analysis by the Washington Post.