Speaking of huge contributions to politicians from Wall Street, you’d think members of Congress would by now be reluctant to accept donations from the American subsidiary of Swiss giant UBS. The economy looks to be in free-fall and the financial excesses (and dubious accounting) of firms like UBS is one important reason why.
UBS has been implicated in the sub-prime mortgage crisis, having been forced to write down “more than $18 billion in exposure to subprime loans and other risky securities.” Even worse, a Senate committee in July “completed its report on UBS’s role in helping wealthy investors shield money from federal taxes,” the Washington Post recently reported. “The bank also is under scrutiny by the IRS and the Justice Department.”
Yet new campaign disclosure reports show that prominent members of Congress, including members of the Senate Banking Committee and House Financial Services Committee, continue to take in big money from UBS. During the second half of August, the company cut checks for a combined $68,500, money that overwhelmingly went to Republicans. Top recipients (accepting the maximum PAC contribution of $5,000) included Senators Lamar Alexander of Tennessee, and Congressmen Adam Putnam of Florida, Lamar Smith of Texas, and Pat Tiberi of Ohio. Senator Mel Martinez and House Republican Leader John Boehner each got a check for $2,500 from UBS.
Some Democrats were also more than happy to take UBS’s cash. Getting the $5,000 maximum from the company were Senator Robert Menendez of New Jersey (through his personal PAC) and Congressman Rick Boucher of Virginia.
UBS, of course, has connections to Senator John McCain’s campaign through former Senator Phil Gramm, one of the senator’s economic gurus. The McCain campaign ditched Gramm–who has served as a lobbyist for UBS and as vice chairman of its investment banking arm–after he detailed his economic recovery plan, namely that things would get better when Americans stopped whining.