The criticism poured in from friend and foe when Hillary Clinton invoked 9/11 on Saturday night to justify Wall Street's generosity to her presidential campaign.
It was a weird moment in the Democratic debate. But her real mistake wasn't in clumsily trying to turn the attention to her role as a senator in rebuilding downtown New York after Sept. 11, 2001.
It was in not using the opportunity to make a stronger case for her proposals to update the 2010 Dodd-Frank financial-reform law. With one exception, her reforms go to the heart of what more needs to be done to keep the financial system safe.
But, first, let's look at how the financial sector spends its money on politicians. Wall Street's contributions, which are by far the largest source of funding for candidates in both parties, have historically swung between favoring Democrats and Republicans.
In 2008, the industry gave more to Barack Obama than to John McCain, even though bankers knew that the financial crisis would end with tough new regulations and that McCain would be more likely to go easy on them.
Obama angered Wall Street when he wiped out bankrupt automakers' debts to bondholders. Obama also backed the Volcker rule, which forced banks to stop trading securities with their own money. On 60 Minutes, he said he didn't run for president to help "a bunch of fat-cat bankers on Wall Street."
They cut him off after that remark and in 2012 overwhelmingly supported Mitt Romney who, as a founder of private-equity firm Bain & Co, was one of them.
This election cycle, the financial sector again seems to favor the GOP. As of mid-October Jeb Bush had received five times more money (including super-PAC donations) than Clinton--$30 million versus $6 million. An analysis by campaign-finance trackers at the Center for Responsive Politics shows her take is only slightly bigger than Chris Christie's $5.2 million and half that of Ted Cruz's $12.5 million (though this is largely from a single donor, hedge-fund manager Robert Mercer, to a super-PAC).
In any case, it's way too simple to say the industry's largess is all due to an expectation of favors in return. Financiers tend to be centrists, or lean toward the liberal side on many issues. Broadly speaking, the sector's leaders support spending increases for education, public works and social safety-net improvements. Deficit spending leads to the creation of Treasury securities, which Wall Street banks trade and profit from. Top financiers also tend to favor immigration reform, Planned Parenthood, gun control, same-sex marriage and environmental causes.
But Wall Street isn't monolithic. Rarely do donors fall in line behind the candidates to whom they write checks. Paul Singer, the billionaire founder of hedge fund Elliott Management, is backing Marco Rubio, yet, unlike Rubio, he supports same-sex marriage.
What may be driving some donors is making sure someone like Cruz isn't elected. The Texas senator would rather shut down the government and see the U.S. default on its debt than increase federal spending. To many Wall Street denizens, even talk of that harms the economy--and ultimately their businesses and bonuses, which depend on high levels of consumer and investor confidence.
So can Clinton take Wall Street's money and not do its bidding? The best clue to the answer may lie in her financial proposal, which fills several holes in the Dodd-Frank law.
She proposes a bank surtax, or risk fee, that would grow along with a bank's size, thus discouraging borrowing to finance risky activities. She would make it easier for prosecutors to "claw back" the pay of bankers who fail to oversee lending or trading desks. She would give law enforcers more time to investigate potential crimes.
Another way to judge Clinton's independence is to look at who is advising her. Her regulatory gurus include Gary Gensler, the former Goldman Sachs banker who ran the Commodity Futures Trading Commission from 2009 through 2013. Not only did he help write Dodd-Frank; he also championed derivatives-trading rules that cut into the industry's profits.
Why then does Wall Street give to Clinton if it doesn't expect something in return? Maybe it wants to help make sure she wins the Democratic nomination. After all, her chief rival, Bernie Sanders, favors breaking up the big banks, calls the industry's business model "a fraud" and blames it for causing inequality. Clinton's position is far more nuanced by comparison. She takes financial leaders' donations because campaigns are expensive (through no fault of her own), and she needs the funds.
Editorial on 11/18/2015