I have seen many conservative publications make reference to the Obama campaign’s intention to raise $1 billion dollars in the next election cycle. Intention is one thing, but ability is another. As a recent New Republic article entitled “The Big Split” has pointed out, Obama is no longer the darling of the hedge fund investment community that he once was. In 2008 he could look them square in the eye and tell them that he would raise their taxes and get praised for candor:
In May 2007, when Barack Obama was but an upstart challenger of Hillary Clinton, he attended a gathering of several dozen hedge fund managers hosted by Goldman Sachs at the Museum of Modern Art in New York. It was not a fund-raiser, just a chance for Obama to introduce himself to the investment wizards who had helped turn the hedge fund sector into the most lucrative and alluring corner of the financial universe. And the first question for Obama was as blunt as one would expect from this crowd. “If you’re elected president,” asked one guest, “what will you do to the taxes on the people in this room?” “I’ll raise them,” Obama fired back. “Which I admired,” recalls one of the attendees, Leon Cooperman, head of Omega Advisors. “And half the guys in that room voted for him.”
Not only did they vote for him, but they opened their wallets for him as well. Four years later they seem to have “lost that loving feeling” where Obama is concerned: “Four years later, that bond is broken. The hedge fund community has overwhelmingly shifted its backing to the Republicans: Mitt Romney has so far outraised Obama by a four-to-one ratio among hedge fund employees, pulling in more than $500,000—not to mention the seven-figure checks his super PAC has received from several top fund managers.” They now despise the candidate that they once had so much affection for:
It makes sense that Obama would lose support from traditional Wall Street. The banks feel aggrieved at having been singled out for blame for the financial collapse—above all in the Dodd-Frank law, which is already crimping their profits. But Obama’s deep unpopularity in the hedge fund world is harder to figure. For one thing, hedge funds may actually benefit from Dodd-Frank. They will have to register more information with regulators—a departure for an industry defined since its beginnings in the late 1940s by its exemption from oversight—but they could also get new business as a result of restrictions on proprietary trading by banks. For another, while the hedge fund sector has shrunk since the crash, the top 40 managers still made $13.2 billion combined last year. And yet, the antipathy that many fund managers are now exhibiting toward Obama is more intense even than what he is facing from bankers. “They hate him now,” says one former Obama administration official.
It looks like people are staring to wake up. Better late than never I suppose.