The Odds of a Wall Street Elitist Winning the Presidency

The Occupy Wall Street mob has long since fled, leaving Wall Street even more united. In the 2012 presidential election, the leader of a private equity fund is personally suiting up for battle. Mitt Romney is ahead of the competition in the Republican Party and endeavors to obtain their nomination. He will meet head-on the self-proclaimed representative of the fundamental interests of the American people, President Obama.

Romney cannot be considered an old friend to the Chinese people, but it can be said that before seeing him, his voice can already be heard. The high-level power struggle at GOME* which caused such an uproar took shape under the shadow of Bain Capital, which Romney founded.

Romney is rich. In January 2012, he published his 2010 tax forms, which revealed his income of $21.7 million for that year. They also showed that he has assets in Switzerland and the Cayman Islands, and a large amount of capital that is managed by Goldman Sachs on his behalf. Romney not only has money, but also a tax rate of 13.9 percent, which is equal to that of an American family with an annual household income of $80,000. The tax rate is so low that even Romney himself is a little embarrassed.

There are many children of the rich in America who have come out to run for president, but people who made their fortune themselves and then run for president are few, and almost none have been elected. There is no precedent in America for showing how someone who becomes rich before being president will perform.

Rich politicians are not likely to represent the interests of the poor, but if they are willing to betray their own class to some degree, perhaps they can help relieve some of America’s societal conflicts. Polarization threatens social harmony in the United States, and in 2011 an opinion poll showed that support and opposition for the tax increase on the rich were 66 percent and 32 percent, respectively.

Whomever Romney chooses to represent will also depend on his own interests. Romney and Wall Street share a lot of the same interests. The head of Blackstone, Steven Schwarzman, backs him, and the majority of Goldman Sachs employees give Romney their wholehearted support in his run for the presidency. Although Bain Capital and Goldman Sachs are two different companies, they are still intimately friendly forces. Goldman Sachs made major contributions to Bain Capital at the time of their original listing on the stock market, and simultaneously, Bain Capital is a major customer of Goldman Sachs. Also, the Romneys’ retirement fund is invested in dozens of Goldman Sachs investment vehicles. With such cooperation, there is no way that Romney doesn’t have a personal attachment toward Goldman Sachs.

Romney is not only a successful businessman, but also a businessman with a background in legal studies. Capital markets have a lot of beach-goers with legal backgrounds who walk along the water without getting their shoes wet. People who study the law are not necessarily law-abiding. On the contrary, because they know and understand the law and its boundaries, they know how to violate it and receive little or no punishment, so brokers with a background in law are even bolder. Over the past decade, three of the top CEOs of Goldman Sachs have been law-school graduates, and the former CEO of Citigroup, Charles O. Prince III, also has a law background. Businessmen in politics are a new characteristic of American politics; Harvard Business School graduate George W. Bush entering the White House is one handy example. A lot of American presidents have a background in law, but there has never been a president who is both a businessman and a lawyer in American history.

In fact, Obama has made a lot of thunder and little rain towards Wall Street, but he doesn’t have the heroic spirit necessary to fight Wall Street to the end. Obama is an agent of the rich, or has at least capitulated to them, and Romney is one of the rich himself. After the financial crisis, Wall Street is more powerful. Shaking a mountain would be easy, compared to shaking Wall Street.

The writer is a professor at China University of Political Science and Law

*Editor’s note: GOME Electrical Appliances is a Chinese company.