Clinton Struggles to Explain Wall Street Ties at Debate

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Clinton and Sanders Clash Over Wall Street, Progressivism
  • Sanders draws anger, accusation of `artful smear' from Clinton
  • Democrats in fiery debate days before New Hampshire primary

Bernie Sanders defined Wall Street’s business model as a “fraud” ripe for revolution. Hillary Clinton said the way to untangle a rigged economy is to work within the system.

During the final debate before next Tuesday’s New Hampshire primary, the two candidates for the Democratic nomination cast corporate America as the villain, with Sanders accusing companies like General Electric Co. of using loopholes to avoid paying taxes.

Bernie Sanders and Hillary Clinton
Bernie Sanders and Hillary Clinton
Photographer: Jewel Samad/AFP/Getty Images

“On behalf of 136,000 hardworking Americans that get up every morning and go to work at GE, Senator Sanders should have his facts right,” Deirdre Latour, a spokeswoman for GE ,said Friday on Twitter. “GE pays all federal, state, local taxes we owe including billions this year. Focus should be on tax reform that allows for job creation.”

Latour was the latest corporate executive to chide Sanders for his campaign rhetoric against corporate America. In an interview with CNBC on Thursday, Goldman Sachs Group Inc.CEO Lloyd Blankfein said Sanders could be fostering a “dangerous moment” with his broadsides against the financial industry.

Meanwhile, Clinton has faced increasing scrutiny over her close ties to corporate titans such as Goldman Sachs, which has employees who have donated to her campaign and paid her more than $600,000 for speeches. Asked if she would release transcripts of the speeches, Clinton said she would “look into” it.

Speech Transcripts

“I don’t think voters are interested in the transcripts of her speeches,” Clinton pollster Joel Benenson said at a Wall Street Journal breakfast on Friday. He said voters care about “will she take on Wall Street.”

Clinton has been grappling with how to deal with the repeated questions from Sanders and others about her ties to Wall Street, and she tried yet another approach in the event at the University of New Hampshire in Durham. It seemed unlikely that her latest answers would put the issue to rest, in a year when seething voter anger at Wall Street has propelled Sanders to a 20-point lead in New Hampshire.

Their face-off at a debate Thursday night was charged with all of the anger, exasperation, gender conflict and anti-establishment warfare that’s been under the surface for months while they were publicly insisting they would stick to campaigning on ideas rather than personal attacks.

Explaining Record

She acknowledged that the answer she gave about her paid speeches before big banks during a Wednesday town hall -- that she took hundreds of thousands of dollars from Goldman Sachs because they’d offered it -- may not have served her well.

"I think I may not have done the job I should in explaining my record," she said.

That was demonstrated in a question submitted through the debate sponsors, MSNBC and the Union Leader newspaper. Clinton was asked if she would release transcripts of the paid speeches she’s made. Clinton declined to say yes or no. “I will look into it,” she said. “I don’t know the status.” Some of her contracts for paid speeches included confidentiality agreements that would complicate their release.

‘Artful Smear’

The tone turned as Sanders once again questioned whether Clinton was truly a progressive and called her part of the establishment for raising money from Wall Street, drug companies “and other special interests.”

Clinton accused Sanders of engaging in a “very artful smear” against her by suggesting, but never directly saying, that she was influenced by millions of dollars in campaign contributions and speaking fees she took from Wall Street and other industries.

“Time and time again, by innuendo, there is this attack that he is putting forth, which really comes down to, you know, anybody who ever took donations or speaking fees from any interest group has to be bought,” Clinton said. “Enough is enough. If you’ve got something to say, say it directly.”

With a flash of anger, Sanders said, “Let’s talk about issues.” He began listing ways in which corporate interests have influenced federal laws on the financial sector, drug prices and more, but not directly linking those claims to any actions by Clinton.

There was nothing new in Sanders’ accusations. But in a year like this, that might be enough.

Common Enemy

Clinton’s umbrage at Sanders’ attempts to tie her to big banks didn’t stop her from joining him in making Wall Street the central villain in the debate narrative. She said that she sounded warnings about the mortgage market before her 2008 presidential campaign. She also cited her support for ending the carried interest loophole and changing executive compensation laws.

"The best evidence that the Wall Street people at least know where I stand is because they are trying to beat me in this primary," she said, citing the millions of dollars that super PACs on the right have spent against her.

Clinton also tried to turn the tables on Sanders by invoking her gender. “Senator Sanders is the only person who, I think, would characterize me, a woman running to be the first woman president, as exemplifying the establishment,” she said.

Foreign Policy

While Sanders may have scored points on Clinton’s financial ties, Clinton regained the advantage when the debate turned to foreign policy and national security. It’s a natural area of strength for Clinton, a former Secretary of State, and her command of the topic was evident.

But the Democratic primary so far has turned on domestic issues, and there Sanders seems in much closer touch with the energy in the party -- the young progressive voters whose enthusiasm pushed him into a within a fraction of a percentage point of Clinton in Iowa.

Clinton tried to counter by characterizing Sanders’ ideas -- for universal health care, for free college tuition -- as unrealistic, liberal fantasies that would smack into cold political reality. In that way, Sanders’ has the more appealing side of the argument, and Clinton can come off as a defender of the the status quo.

"A progressive is someone who makes progress. That is what I intend to do,” she said. 

But in the eyes of many Democratic voters, there was only one true progressive on stage last night, and they seem ready to reward the 74-year-old senator from neighboring Vermont with a big win in New Hampshire. Clinton remains the odds-on favorite to win the nomination, but her Wall Street woes are likely to follow her in the November election against the Republicans.

--With assistance from Arit John, Jennifer Epstein and Toluse Olorunnipa.

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