As the front-runners in the Republican presidential primary field pocket donations from Wall Street investors, Jon Huntsman Jr. is turning them into a campaign issue.
“We’ve had implosions on Wall Street,” he said, in an interview with Bloomberg News yesterday. “We had bad behavior on Wall Street. We had lack of transparency on Wall Street. I believe they are, in some measure, responsible for a diminishment in trust.”
It’s a message that Huntsman hopes can revive his presidential campaign and echoes a populist theme President Barack Obama sounded yesterday in a speech in Kansas when he said “breathtaking greed” contributed to the nation’s economic turmoil. Huntsman is drawing a contrast with Republican rival Mitt Romney, a former private equity investor who made a fortune as founder of Bain Capital.
Huntsman has staked his campaign on New Hampshire, hoping for a surprise victory against Romney that would make him a serious contender in the nomination battle. The former Utah governor stands at 9 percent in New Hampshire among likely Republican primary voters, according to a Dec. 4 NBC News/Marist poll.
By taking aim at Wall Street, Huntsman believes he can piece together a coalition of anti-bailout Republicans and anti-Wall Street independent voters in the fiscally conservative early voting state.
Last month, Huntsman released a plan that would cap the size of banks and impose new fees on the biggest financial institutions. In campaign appearances, he accuses his rivals of being beholden to their Wall Street donors, and he’s expressed support for the populist Occupy Wall Street protests.
“There are some points of convergence that many Americans can relate to,” he said, sitting amid the oriental rugs and polished dining room table in his Washington home. “The concern about banks that are too big to fail is very real.”
Romney’s business background has helped him become the candidate of choice for Wall Street investors frustrated with what they see as targeting of the their industry by the Obama administration.
“It’s a pretty smart tactic because Mr. Romney made a lot of money from big banks and it’s going to be hard for him to respond on this,” said Simon Johnson, an economics professor at the Massachusetts Institute of Technology who has been critical of the banking industry.
Citing Romney’s ties to Wall Street, Huntsman, the son of a billionaire industrialist, raises questions about whether the former private equity investor would be able to stand up to the industry.
“He would seem to be doing quite well with the Wall Street insiders,” Huntsman said. “If too big to fail is in fact an ongoing problem for this country, you’re going to need someone who can stand up and point out those deficiencies and do so without the additional pressure of an industry that built them up politically.”
Texas Governor Rick Perry, who is also lagging in polls, has used a similar line against Romney and the newest front-runner in the field, former House Speaker Newt Gingrich.
Gingrich and Romney are “substantial insiders of Wall Street and Washington, D.C.,” Perry said in a Nov. 30 interview on Fox News.
It’s an unflattering portrait that Democrats hope will take hold. Obama’s allies have already begun painting Romney as more interested in supporting Wall Street than addressing the economic challenges facing the middle class.
“This is a more effective argument in the general election for Obama than it is for the primaries,” said Bob Shrum, a Democratic strategist who helped run Senator Edward Kennedy’s 1994 re-election campaign against Romney. “Romney’s kind of a poster boy for the top 1 percent.”
The question is whether those attacks will resonate with Republican primary voters.
“Coming from him, it doesn’t ring genuine,” said Mark Meckler, co-founder of the Tea Party Patriots. “He comes from a long-term family of wealth.”
Huntsman is the son of Jon Huntsman Sr., founder of Huntsman Chemical. After working in the Reagan White House and serving as ambassador to Singapore during the administration of President George H.W. Bush, Huntsman joined the board of his father’s company.
“He’s been part of the ruling elite,” Meckler added. “I don’t think that Huntsman can claim outsider status.”
While the rest of the Republican field frequently promises to end all government bailouts, none have gone as far as Huntsman in introducing a specific plan to restructure the financial industry.
His proposal, released on Nov. 28, caps bank size and total borrowing based on their assets as a percentage of gross domestic product. Those institutions that exceed the permitted size would pay a fee designed to help cover the cost to taxpayers of any future bailouts. Huntsman would also shut down Fannie Mae and Freddie Mac, two government-backed mortgage lenders caught up in the housing meltdown, and repeal the Dodd-Frank Act passed by Congress to regulate the financial industry.
“Huntsman is the boldest of anyone who’s taken up this issue,” said Johnson.
Congress briefly considered breaking up large banks during the debate over Dodd-Frank. Huntsman’s plan is closest to a proposal by Democratic Senators Sherrod Brown of Ohio, and Ted Kaufmann of Delaware that got just 33 votes in the Senate, falling far short of the 60 needed to move forward.
On the campaign trail, Huntsman’s rivals blame the financial crisis largely on Democratic leadership, while rarely mentioning the big banks that were at the center of the government bailout.
Gingrich has called for authorities to jail the two Democratic sponsors of the law, Representative Barney Frank of Massachusetts and former Senator Christopher Dodd of Connecticut.
“If you want to put people in jail,” he said in an Oct. 11 debate, “you ought to start with Barney Frank and Chris Dodd.”
Huntsman accused his rivals of being hesitant to criticize banks because they don’t want to cut off a source of campaign contributions.
Romney is backed by a long list of top financial industry executives, including Stephen Schwarzman, chairman of Blackstone, the world’s largest private equity firm, who plans to host a campaign fund-raiser next week.
Gingrich spent the early part of this week meeting with potential donors in New York City, hoping to raise the funds needed to catch up with Romney.
“They want to be able to point out the deficiencies in front of some crowds, but they want to take money from the banking sector,” said Huntsman. “They’re not going to get contributions from the banking sector if they’re specific about how they want to remedy the situation.”
Huntsman has struggled to raise any money at all. He has reported donations of $2.2 million through Sept. 30 -- and lent another $2.2 million of his own money to his campaign, according to the most recent financial disclosure reports. Romney raised $32 million during the same period.
In September, Huntsman closed his Florida headquarters to save money and moved his campaign operation to the Granite State.
Time Running Out
One challenge facing Huntsman is that time is running out to make an impression on voters. His polling numbers in the state, while climbing, remain low. In a Bloomberg News poll conducted Nov. 10-12, Huntsman draws 7 percent support, which puts him fifth in what was then an eight candidate primary field.
Last month a super PAC, financed in part by Huntsman’s father, began running ads in the state. The television spot, which highlights Huntsman’s background as governor of Utah and ambassador to China during the Obama Administration, ends with a man asking, “John Huntsman, why haven’t we heard of this guy?”
Huntsman says proposals like his financial reform plan give him something his rivals lack: The ability to beat Obama in the general election.
“Nobody comes close to us in the area of electability,” he says. “I think in the end that’s going to be a big part of how people will break in your favor.”