At Obama’s side was Jim Messina, his campaign manager. Messina was forty-one years old, pale-skinned, rapid-talking, and profane. As Plouffe’s deputy on the 2008 campaign, Emanuel’s in the White House, and chief of staff to Montana senator Max Baucus before those gigs, he had earned a reputation as a genially ruthless fixer—a very nice guy who would merrily club you with a truncheon if you crossed him. In 2002, while running Baucus’s reelection effort, Messina okayed a notorious ad insinuating that his boss’s opponent was gay; in 2010, he served as Obama’s point man on the repeal of “don’t ask, don’t tell.” Messina saw no conflict between these episodes. He was all about winning.
Dispatched to Chicago in February, Messina was busy building Obama’s reelection operation into a colossus, as innovative as Google and as juggernautish as Exxon Mobil. For its headquarters he rented the sixth floor of One Prudential Plaza, a towering high-rise overlooking Lake Michigan, filling it with 160 staffers by late June. To reenlist Obama’s grassroots army from 2008, he had already opened sixty field offices in thirty-nine states and was upgrading the campaign’s high-tech tools and infrastructure for the age of Twitter, Tumblr, and Pinterest.
What Messina was doing most urgently was meeting with donors—all the time, all over the place. North of $750 million would be required to repel the coming Republican onslaught, he told anyone who would listen, although in truth his goal was more like $1 billion. (After all, Obama had rustled up $748 million the last time around.) To hit that target, Obama would need to work the circuit tirelessly for eighteen months. He would need to tap Hollywood, Silicon Valley, trial lawyers, and labor. But most of all, he would need to milk Wall Street for millions—because, to borrow from Willie Sutton, the Street was where the money was.
In 2008, Obama had done precisely that. Though the importance of the Web and small donors to the money machine that the Obamans built was often and rightly noted, the role of Gotham’s financial elite was impossible to overstate. By Election Day, three of the top seven institutions bundling donations to him were New York megabanks: Goldman Sachs, Citigroup, and JPMorgan Chase, with UBS AG and Morgan Stanley further down in the top twenty.
In the course of collecting the bankers’ checks, Obama began consulting several of them as informal advisers, notably JPMorgan CEO Jamie Dimon and UBS Americas CEO Robert Wolf. He nursed a network of hedge-fund and private-equity admirers, such as Boston Provident’s Orin Kramer, Avenue Capital’s Marc Lasry, and Third Point’s Daniel Loeb. When the lords of finance gazed at Obama, they saw a version of themselves: a product of the meritocratic elite, a self-made Ivy Leaguer, a hyper-rational sophisticate transcending the hoary dogmas and histrionics of conventional party politics. Dimon was so smitten that he spent three days in Washington with his family during the inauguration. It all smacked of puppy love.
But once Obama took office, the romance went south fast. Like many other businessfolk, the Wall Streeters disparaged Obama’s team for lacking anyone with a meaningful background in the private sector. When Jarrett would huff, “Well, I have one,” they rolled their eyes; they considered her a political hack, ineffectual and entitled. Axelrod they saw as a combination of Trotsky and Rasputin, spouting class warfare on TV. Larry Summers and Tim Geithner they derided as gormless eggheads. “They’re smart,” remarked one hedge-fund hotshot, “but you’d never, like, let them run a business for you.”
Even more than they disdained Obama’s people, the Wall Streeters hated his policies. And not so much the Dodd-Frank reregulation as his proposals to raise taxes on “carried interest” (the main source of income for private-equity pooh-bahs) and on the sale of hedge funds. But above all, they despised what they perceived as Obama’s hostile tone: his attacks on the financiers who resisted the terms of the administration’s plan to rescue Chrysler as a “small group of speculators . . . who held out when everybody else is making sacrifices,” his inveighing on 60 Minutes against “fat-cat bankers,” his lecturing them piously that he was “the only thing between you and the pitchforks.”
By the middle of 2010, many of Obama’s Wall Street friends were heaping scorn on him behind his back and to his face. In a letter to his investors that August, Loeb, who had raised $200,000 for Obama in 2008, accused the administration of attempting to “fracture the populace by pulling capital and power from the hands of some and putting it in the hands of others.” (A few months later, around the holidays, Loeb sent an e-mail to several other Obama bundlers that started “Dear Friends/battered wives” and suggested that the book He’s Just Not That Into You would make an apt stocking stuffer.) At a private White House lunch, Dimon pulled a prepared speech from his pocket and admonished Obama for undermining business confidence. Goldman Sachs CEO Lloyd Blankfein was even starchier, telling friends, “These people are like the Chicago mob.”
The Wall Streeters still loyal to Obama were concerned that all the bellowing would affect his ability to raise money among their peers. One night in New York, after listening to Blankfein and some other bankers trashing the president, Orin Kramer ran into Obama’s lead pollster, Joel Benenson. Kramer was a storied bundler, having raised millions for Bill Clinton, Al Gore, John Kerry, and Obama. He knew the score.
“I was just with some people who have been supportive, financial types, and they sound kinda negative,” Kramer said. “Should I care?”
“No,” Benenson replied. “Money is never going to be a problem for Obama.”
Obama’s own attitude toward fund-raising struck his Wall Street supporters as equally blithe. When he wasn’t bashing them in the nose, he was giving them the back of his hand. The stories of his aloofness and inattentiveness to his donors were legion. Of the first White House Christmas party, in 2009, when Obama declined to take photos with them and their families. (“Big deal,” he said to Rouse. “They’ve all got pictures with me before.”) Of the $30,000-a-plate dinner at the Four Seasons in 2010, at which Obama, after devoting a brisk seven minutes to each table, retreated to a private room to sup with Jarrett and his body man, Reggie Love—a tale that traveled so widely it became a sort of urban legend.
What made Obama’s behavior come across all the shabbier was the unavoidable comparison with Bill Clinton, who intuitively grasped the neediness of the deep-pocketed—and fed it, massaged it, manipulated it. He listened (or pretended to). He made them feel esteemed. Anyone hosting a fund-raiser for 42 would get a personal thank-you call, a handwritten letter, a signed picture. For the eight years of Clinton, Wall Street Democrats had been solicited, served, and serviced by the master of donor maintenance. For the first two years of Obama’s reign, they got . . . squat.
Obama’s reaction to Wall Street’s displeasure was acute indifference tinged with exasperation. On substance, he hadn’t an ounce of sympathy for the plaints of the bankers. Not only had he resisted the calls to nationalize the banks, but his White House had helped thwart the proposals of some in his party to break them up. He had left the bankers’ bonuses alone, incurring the wrath of the left. Sure, he had tossed brickbats at the fat cats. So what? You folks are too sensitive, you need to get over yourselves, he told his Wall Street friends. “I can take a punch,” Obama said. “Why can’t you guys take a punch?”
When it came to the whining about the lack of stroking and schmoozing, he shrugged. Obama had never courted donors. He had worked his tail off at fund-raising in 2008, but he hadn’t toadied—and the money cascaded in. There was something inside him that made him recoil from even the faintest hint of political or personal indebtedness. If the Wall Streeters wanted to punish him for his policies, so be it. If they wanted him to kiss their behinds, to hell with that.
Obama was unwilling or unable to change his ways even when he needed to hook the most titanic financial fish—George Soros. Soros, of course, was a billionaire hedge-fund operator and philanthropist whose avid liberal leanings had led him to spend lavishly in campaigns past, including $27.5 million through an outside group in 2004. In the 2008 campaign, Obama’s int
roduction to Wall Street took place in Soros’s Manhattan office. But when Soros sought a meeting in the White House, he was repeatedly rebuffed for more than a year. Soros wasn’t trying to have legislation tweaked or a regulatory rule revised. All he wanted, he insisted, was to discuss the economy.
Finally, in September 2010, a secret summit was set up at the Waldorf Astoria in New York by Patrick Gaspard, in the hope that Soros could be induced into serious check-writing on behalf of the Democrats ahead of the midterms. Soros held forth for forty-five minutes, lecturing Obama not about the economy but about how the president should talk about the economy—the financial savant as self-appointed message guru. In the room, Obama was annoyed and bored. Afterwards, he fumed, “If we don’t get anything out of him, I’m never fucking sitting with that guy again.”
Soros apparently felt no better about the meeting: no big checks were forthcoming. And the Democrats could have used them. In the first election cycle of the post–Citizens United era, Republican outside groups poured nearly $200 million into House and Senate races, more than double the total on the Democratic side. The flashiest new players were American Crossroads and Crossroads GPS, both set up by Bush ur-strategist Karl Rove, and Americans for Prosperity, backed by right-wing billionaire brothers Charles and David Koch. But equally dramatic was the shift in Wall Street’s contributions: from 70 percent to Democrats in 2008 to 68 percent to Republicans in 2010.
In a way, the spending figures were more of wake-up call for Obama than the midterm results; they signaled that the ground was shifting ominously beneath his feet. In 2008, the magical elixir of hope, change, Clinton fatigue, and Bush ennui had carried Obama a long way toward victory, but the fact that he had outspent John McCain by more than two to one hadn’t exactly hurt. Now Obama faced the likelihood of spending parity or worse—a bracing reality brought home in early 2011, when Rove announced that Crossroads planned to raise $120 million for 2012, followed quickly by the Koch brothers pledging to kick in another $88 million.
Obama was hardly confronting a hanging at dawn, but the threat of a barrage of negative TV ads even before the GOP nominee was chosen did concentrate his mind. As Messina prepared to decamp from Washington for Chicago, Obama pulled him into the Oval Office. Plouffe had suggested the president might refrain from fund-raising until the summer so he could focus on governing. The president disagreed. We need to get going, get this money together, he told Messina. I don’t want to wait.
In a political meeting before the midterms, Obama had observed that he saw no need to curry favor with business and finance then, because if Democrats lost the House, “we’re gonna have to kiss their asses anyway.” The appointment of Daley was, in effect, a big smooch on the backside of Wall Street. His presidential puckering up continued in March, when Obama invited two dozen bankers, hedgies, and private equitizers who had supported him in the past—Lasry, Kramer, Wolf, et al—for a meeting in the Blue Room of the White House.
“I know you guys take a lot of flak in your community for supporting me,” the president said. Teasingly, he referred to some of their colleagues as “babies.” Solicitously, he asked, “How do you think we’re doing?” Then Obama questioned them about how he could do better. Some were cynical about the outreach: He’s only doing this because he’s worried. Others were heartened: Hey, at least he’s trying.
Obama let the Wall Streeters know he planned to be in New York a lot in the months ahead. And by the time he turned up at the Daniel dinner, it was, in fact, his seventh event in the city in three months. The condensed stump speech he delivered amid the clink of crystal stemware was crisp and free of either pandering or apologies; he mentioned Wall Street only once. But he deftly and charmingly acknowledged that he knew the bloom was off the rose.
“I hope you will be as enthusiastic as many of you were back in 2008,” Obama said. “I’ve got to tell you that, partly because of the gray hair, I know that it’s not going to be exactly the same as when I was young and vibrant and new. And there were posters everywhere: HOPE. The logo was really fresh. And let’s face it, it was cool to support me back then. At cocktail parties you could sort of say, ‘Yeah, this Obama guy, you haven’t heard of him? Let me tell you about him.’”
Most of the Wall Streeters who had been in the Blue Room were at Daniel, too. They sat there smiling, chuckling, nodding—and wondering if it was all for naught. Lasry, a billionaire and close pal of Clinton’s who often lent the former president his jet, was an admirer of Obama’s. But he was well aware that this made him an outlier in his circle. The antipathy for Obama had become an emotional thing on Wall Street. Over at Goldman, Lasry had heard, an edict had come down that there would be no giving to the president. And when Lasry asked around among his friends who had raised money for Obama in 2008, three-quarters said they wouldn’t vote for him again, let alone bundle or donate.
When Obama finished his Daniel remarks, he made a loop around the room, stopping at each table, asking the same question he’d posed in the Blue Room: How do you think we’re doing?
Three months earlier, Lasry had sugarcoated his reply, offered some suggestions. This time he thought, What the hell, tell the truth. He said, It’s not going well. Nobody here trusts you.
Obama flew back to Washington more convinced than ever that he needed to make the grand bargain work. It was the only plausible way, he thought, to reduce the dyspepsia of the plutocrats. On the surface, his fund-raising looked healthy. In the three months since the reelect got up and running, he had raked in $86 million. But Obama sensed the fragility undergirding that big number. He knew it had required him to crank through thirty-one events, a pace he couldn’t hope to maintain. And, indeed, as June turned to July and Obama became engrossed on a daily basis in negotiating with Boehner, he found himself having to cancel fund-raisers left and right.
That was the bad news. The good news was that he and Boehner seemed to be making progress. Oh, and another thing: in the president’s absence from the fund-raising trail, his campaign had discovered a new star to take his place, one who happened also to be named Obama.
• • •
FOR ANYONE FAMILIAR WITH the first lady, her emergence as a top-drawer buck-raker would have once seemed as likely as Biden moonlighting as a mime. Michelle had long cast a jaundiced eye on politics, and, in truth, she still did. In her husband’s first presidential campaign, she was initially a conscientious objector, then a reluctant conscript plagued by missteps that fed a caricature of her as an unpatriotic, aggrieved, and resentful black woman. But after her knockout speech at the 2008 Democratic National Convention and two years in the White House radiating warmth, humanity, and devotion to her daughters, her public image was pure platinum. Working mothers saw her as one of them, but with a bit more glamour. Independents loved her efforts to help military families and combat childhood obesity. Her approval ratings were in the high sixties, well above her husband’s.
She enjoyed her celestial popularity and did much to protect and enhance it. She also enjoyed the perks of the White House, much as the admission pained her. But she chafed at the constraints of the bubble and the glare of nonstop scrutiny—“I have to put my makeup on to walk my dog in the backyard,” she complained—and at times made it sound as if she considered being first lady a burden. She never wanted this position, never asked for this position, and it irritated her when people couldn’t grasp the sacrifices she was making—any semblance of a normal life, for instance. When she planned to take Sasha and Malia on a swanky trip to Spain in the summer of 2010, she was warned it would cause a royal ruckus, as it did. (“A modern-day Marie Antoinette,” scolded the New York Daily News.) But didn’t she have a right to take her girls on holiday? Didn’t they have a right to see the world? Forget it, she thought. We’re going.
There were tensions, too, with the West Wing staff—with Rahm, Gibbs, Axe, and even Jarrett now and then. Michelle was exacting, lawyerly, precise; she thought them sloppy, disorganized, and presumptuous. (Mostly they w
ere scared to death of her.) In the run-up to the midterms, they had begged her to campaign actively for Democratic candidates. She resisted for months, then demanded to see a detailed plan. At a meeting in the Oval Office in mid-September, they laid it all out for her, complete with reams of data and even a PowerPoint. Michelle said she was impressed with the level of preparation—but agreed to do only eight events, a sliver of what her husband’s political team wanted. But here was another good-news/bad-news story: at the events she did, she sparkled.
In truth, Michelle didn’t care about congresspeople. Her opinion of them was even lower than the president’s. What she cared about was Barack. She worried that campaigning in a partisan way in the midterms would erode the pile of political capital she’d painstakingly amassed. My husband’s going to need every bit of it, she thought. That’s what I want to use it for—I want to campaign for MY GUY.
Messina prayed those sentiments applied equally to fund-raising. In March, he sat down with Michelle in her East Wing office to make his pitch. Like his colleagues in September, he put together a granular presentation. Her events would entail her stump speech only, no questions. She would just do day trips that yielded at least $1 million. (Biden’s floor was $250,000.) She would never be away from the girls when her husband was traveling. She would lend her signature to e-mail and direct-mail solicitations, which she hadn’t done in 2010. Messina expected her to push back at least on some elements of the plan—this was Michelle. Instead she changed nothing, approved it all without hesitation.
And then she killed, pulling in $10 million in that first fund-raising quarter. As the summer rolled on, her mail and online pleas for money outperformed her husband’s. And while she couldn’t say she was having a ball, she was surprisingly game. When Messina sat down with her again to discuss her schedule for the fall, Michelle studied his cautiously culled requests and said, “That’s all?”
Double Down: Game Change 2012 Page 4