If you were a member of the Wall Street aristocracy, one of those hedge fund hot shots who makes half a billion dollars a year, which horse would you bet on in the race for the White House?
Senator John McCain seems like the natural choice for the rich who are voting their wallets. After all, Mr. McCain, the presumptive Republican nominee, might help the wealthy keep more of their supersize incomes by making the Bush tax cuts permanent.
Senator Hillary Rodham Clinton and Senator Barack Obama, the two Democratic contenders, talk about getting tough on the rich. But at least Mrs. Clinton has a lot of old friends on Wall Street. Maybe she could figure out how to create a bubblicious economy like the one her husband presided over in the 1990s. Wall Street likes a good bubble.
And Mr. Obama? He backs something called the Stop Tax Haven Abuse Act, a measure that would limit all offshore accounts that the wealthiest hedge funds have set up. That’s not something Wall Street wants.
And yet for all of this, many of the wealthiest hedge fund managers are lining up behind the Obama campaign.
Many of the top 10 managers on Alpha magazine’s mind-blowing 2007 rich list, which was released last week, have put money on Mr. Obama, according to the Center for Responsive Politics, which tracks campaign contributions. They have each given the maximum donation allowed, $2,300. (Let’s face it, this is pocket lint to these guys.)
Mr. Obama’s hedge fund contributors include:
John Griffin, the founder of Blue Ridge Capital, who made $625 million in 2007, according to Alpha. Mr. Griffin is backing Mr. Obama after initially supporting Mitt Romney.
Kenneth C. Griffin (no relation) of the Citadel Investment Group in Chicago, who earned $1.5 billion. He contributed to the Obama campaign after the senator came to his office last year.
Stephen Mandel of Lone Pine Capital, who took home $710 million last year.
And, of course, George Soros, who earned almost $3 billion last year. It is no surprise that Mr. Soros, a Democratic stalwart, is backing Mr. Obama. Mr. Soros campaigned against President Bush in 2004, and Moveon.org, which the billionaire investor has plied with tens of millions of dollars, endorsed Mr. Obama in February.
Of course, not every Richie Rich is backing Mr. Obama.
James H. Simons, the mathematician who runs Renaissance Technologies, who made $2.8 billion last year, has donated to Mrs. Clinton.
And Steven Cohen of SAC Capital, whose take home pay was $900 million, is splitting his money down the middle: He donated $28,500 to both the Democratic and Republican Senatorial Campaign Committee. (He had given money to John E. Sununu and Christopher J. Dodd.)
John Paulson of Paulson & Company, the top earner, with $3.7 billion last year, doesn’t appear to have a financial dog left in the hunt: He gave to Mitt Romney and Rudolph Giuliani.
Philip Falcone, who founded Harbinger Partners and made $1.7 billion last year, has given to the Republican National Committee, but to no individual candidate. (His firm may have bought itself influence in another way: It recently won agreement from The New York Times Company to add two members to its board.)
Timothy Barakett of Atticus Capital, who made $750 million, and O. Andreas Halvorsen of Viking Global Investors, who earned $520 million, don’t appear to have given money to either side.
By the way, just so we don’t forget: these guys are not like you and me. The median American family earned $60,500 last year.
So why is Mr. Obama such a popular choice among the hedge fund crowd?
In a word, access. Unlike Mr. McCain and Mrs. Clinton, Mr. Obama is relatively new to national politics and is therefore open to bringing new people — and new money — into the tent. For money types who want a table, or at least to look involved and get an invitation to the right parties, Mr. Obama is the candidate.
As one of the hedge fund managers on the Alpha list said, “To be in Hillary’s inner circle, you had to be giving a decade ago, when Bill was president.” The same goes for Mr. McCain.
The Clintons’ Wall Street sanctum is filled with old pals from the worlds of banking and private equity. These people have been with the Clintons since the beginning. They include Roger Altman, chairman of Evercore Partners and former deputy treasury secretary under President Clinton; and Steven Rattner, co-founder of Quadrangle Partners (Mr. Rattner’s wife, Maureen White, is a co-chairwoman of finance for Mrs. Clinton’s campaign). And it’s not as if Mrs. Clinton has no hedge fund support. Avenue Capital’s co-founder, Marc Lasry, has been a longtime Clinton supporter — so much so that he hired her daughter, Chelsea.
And then there is what some Wall Streeters describe as the “iconoclast thing.” Hedge fund managers like to think of themselves as outsiders with fresh perspectives. The Obama campaign is trying to project a similar image. Mr. Obama might be struggling with the blue-collar vote in Pennsylvania, but he has nailed the hedge fund vote.
Then again, politics, like the markets, can change fast. As one hedge fund manager who is backing Mr. Obama said, “It is very possible I may change my mind.” They don’t call them hedges for nothing.