Paul Krugman writes about corporate PACs switching sides to the Republicans over the last year:

Look, for example, at the campaign contributions of commercial banks — traditionally Republican-leaning, but only mildly so. So far this year, according to The Washington Post, 63 percent of spending by banks’ corporate PACs has gone to Republicans, up from 53 percent last year. Securities and investment firms, traditionally Democratic-leaning, are now giving more money to Republicans. And oil and gas companies, always Republican-leaning, have gone all out, bestowing 76 percent of their largess on the G.O.P.

These are extraordinary numbers given the normal tendency of corporate money to flow to the party in power. Corporate America, however, really, truly hates the current administration. Wall Street, for example, is in “a state of bitter, seething, hysterical fury” toward the president, writes John Heilemann of New York magazine. What’s going on?

Krugman attributes it largely to the top marginal income tax rate, which has been consistently lowered over the last thirty years, and is expected to rise when the Bush tax cuts expire at the end of 2010. But he also attributed it to a newfound vigor for regulatory oversight of the multinationals, which is truly rich. As I noted earlier today, corporate execs seem to be angrier that they have to ask for what they want, and then get it, instead of just getting it without asking. The changes from the Bush era are largely tonal in nature, although in some cases Obama’s regulators are at least seeking to enforce the laws on the books. And this is simply a bridge too far for the Masters of the Universe.

The Heilemann piece referenced above is truly amazing. It’s not enough for Wall Street that they run the economy and get bailed out whenever things go south – they want their damn rings kissed in the process. In the meeting described in 13 Bankers, the Simon Johnson/James Kwak book on the financial crisis, Obama famously told the assembled, “My administration is the only thing between you and the pitchforks.” Apparently, the banksters have come to believe that Obama is now holding the pitchfork and leading the mob, which is one of the most warped expressions of self-entitlement I’ve ever seen. But what can you expect from people who wrecked the economy and still find themselves essential to its success?

Here’s just one representative quote from this long piece:

For much of Wall Street, this triple blow constituted the final rupture with Obama. Unpleasant as the policies were in the view of the financiers (Dimon: “Using tax policy to punish people is a bad idea”), what seemed to upset them even more was the shift to a more hostile tone (Dimon: “The incessant broad-based vilification of the banking industry isn’t fair, and it is damaging”). To Wall Street, what was going on was crystal clear: Obama had succumbed entirely to the dictates of his political handlers.

“For all the criticisms about Clinton being political, the fact is that in the economic arena, his decisions were driven predominantly by the policy considerations,” says a Wall Street graybeard who knows both 42 and 44. “During the first year, Obama was a lot like that; he withstood a lot of political pressure to nationalize the banks and so on. But this red-hot vituperativeness signals that something has changed.”

I guess the President should apologize for being so hostile and vituperative. Surely these good men and women have done nothing to deserve it.

David Dayen

David Dayen