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Hugh Hewitt Book Club

National Review deputy managing editor Kevin Williamson is suspicious about Wall Street and their support of Mitt Romney

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HH: My pals at FratersLibertas.com, Chad and gang who are virulently anti-Romney, have latched on to a new piece over at National Review by the deputy managing editor there, Kevin Williamson, to add to their feverish anti-Romney vapors. And so I thought I’d go talk to Kevin himself. Hey, Kevin, Happy New Year to you.

KW: Happy New Year to you as well. How are you doing?

HH: Good. Have you seen Man and Boy with Frank Langella in it, yet

KW: I have not. Is it any good?

HH: Oh, it’s tremendous, but it’s about nasty capitalists in the 30s, and as I read Repo Men, your very interesting article that Chad the Elder liked so much, I thought this is really a cartoon of Wall Street. I mean, do you really think Wall Street is full of these kind of people that you’re writing about?

KW: Well, you know, I deal with these guys all the time. I know a lot of them. They’re part of my beat. Yeah, it’s a fairly common type. I mean, your average guy on Wall Street? No, he’s not, is not this sort of corrupt, self-dealing kind of character. They mostly do useful work. I mean, I’m sort of mostly pro-finance and mostly pro-business. You know, I’m not one of these people who has this kind of superstitious belief that finance doesn’t actually create anything of value. I believe that it does. But there is this really unhealthy and often corrupt intersection between finance and government. And that’s the real problem, I think. It’s not that finance is a problem in and of itself. It’s when it intersects with politics, it has the ability to create some really destructive things.

HH: Now you know, what I found most interesting in your piece is I don’t live in Manhattan, I don’t run with these people very much, and I’m just a Californian, and I’m out here being a traditional small government conservative who’s pro-life. And when I read what Chad quoted you saying, here’s what Wall Street doesn’t want. It doesn’t want to hear from Sarah Palin or Michele Bachmann or even Newt Gingrich, or suffer any sort of Tea Party populism. It wants you rubes to shut up about Jesus, and please pay your mortgages. It doesn’t want to hear from traditional Republican constituencies such as Christian conservatives, moral traditionalists, pro-lifers or friends of the 2nd Amendment. It doesn’t even want to hear much from the Chamber of Commerce crowd, because they guys are used car dealers and grocery store owners, and for the most part, strictly from Hicksville, so far as Wall Street is concerned. Wall Street wants an administration and a Congress and a country that believes what is good for Wall Street is good for America, whether that is true or isn’t. Wall Street doesn’t want free markets. It wants friends, favors and fealty. Now Kevin, A) I just don’t think that’s true. I think…but then, you link it to being anti-Romney, and so I thought to myself, what is going on here? When has Republicanism ever been anti-Wall Street?

KW: Well, I don’t know that they’re necessarily all that anti-Romney, although they’re certainly more pro-Obama. The thing is that there is a great misconception that Wall Street is politically conservative, or even that big business, high finance in general is politically conservative. It’s not. If you look at the kinds of issues that most American conservatives really care about, where they are culturally, where they are morally, where they are religiously, these guys aren’t there. And not only are they not there, they’re actively opposed to it. I mean, these are guys making five, six, seven hundred thousand dollars a year who live in Manhattan and getting manicures and sending their kids to Choate and places like that. They’re not showing up at parent’s day in a Sarah Palin T-shirt. That’s just not who they are, not what they believe. But the one thing that they really are good at is using the rhetoric of being pro-business and being pro-free enterprise to kind of buffalo us conservatives, and get us to agree to all sorts of favors and subsidies and handouts for them.

HH: I’m just not going to buy that. I do think they might show up in a Sarah Palin T-shirt, and I do think that they are generally often quite conservative, very Evangelical. Some are deeply Roman Catholic, traditionalist, generous, high-minded people.

KW: Not nearly as much as you think. You know, 30 years ago, the Upper East Side was pretty much all Republican in terms of its officer holders, you know, who would elect you to the city council and the state legislature, and all that sort of thing. There’s not one Republican left out there, elected office holder…

HH: But Kevin, I’m just thinking of the people that I know personally. What are you basing a sweeping indictment of Wall Street on, other than…

KW: Well, I’m basing it mostly on their political donations, if you look at where they actually give their money to, who they support. That way, you’ll find it’s overwhelmingly Democratic. And certainly to the extent that they give money to Republicans, it’s not too largely to conservative Republicans. You know, last time around, it was seven out of ten dollars to Barack Obama. It was seven out of ten dollars to the Democrats in the ’08 cycle, still leaning fairly heavily that way in some firms now, although oddly enough, Romney seems to be doing pretty well among the donors, except, oddly enough, at Bain, where he used to work.

HH: But your argument, if I can distill it down, and as it has been interpreted by Chad at FratersLibertas.com and others, is that we should be suspicious of Romney because Wall Street supports him.

KW: Oh, I think we should be suspicious of Romney for lots of reasons. You know…

HH: Wait, but that’s a diversion. Isn’t your argument, didn’t I just distill it correctly? We should be suspicious of Romney because Wall Street supports him?

KW: I think we should ask ourselves what they’re hoping to get by supporting him, yes.

HH: And so, in doing that, you are telling Republicans, it’s sort of a Ron Paul critique, and I find it very anti-free market. And I’m actually kind of stunned that a conservative would find, would launch a polemic against finance. Finance is what makes the world…

KW: We’re not talking about free markets here. We’re talking about firms that have been bailed out by the government, that rely on political handouts, that rely on special favors from Washington, that helped Nancy Pelosi and her husband get their hands on all sorts of IPO’s that are normally closed to the general public.

HH: Oh, no, you’re mixing up many different things here. I’m talking about pure finance. Isn’t pure finance a good thing for the world? People who make money go round…

KW: Well, look, where are you going to find any pure finance on Wall Street? Show me a firm that wasn’t bailed out by the government that’s still out there. Show me one that’s not taking politics into consideration in every decision it makes.

HH: But you’re making the leap from the one to the other again. I’m asking you if pure finance, is the movement of money from those who have to those who need, who wish to invest it, is a good thing. I think it is. I think it’s undeniably a necessary thing. I don’t think you have to be Ayn Rand to think hey, you guys, go off and do what you want and make money, and all the world benefits.

KW: Well, yeah, I’m all for people investing their money in productive enterprises. But that’s not what we’re talking about here. That’s not what, you know, if you think that’s what Goldman is up to these days, and J.P. Morgan, and the rest of those guys, no, it’s not.

HH: Well, you just went sinister, though.

KW: That’s not the entirety of their business, and they’re not guys who out there are arguing for free markets and free enterprise. I mean, they’re just not.

HH: What do you think they’re doing?

KW: What do I think they’re doing? I think that they are looking for backstops everywhere they can find them. I mean, how do you think we got the housing bubble? There was always the assumption, it turns out to be a correct assumption, that if they had a lot of exposure to these government-backed securities, or securities based on government-backed mortgages, they’d get a bailout. They’re looking to have regulations written in such a way to benefit them. They’re looking to have…

HH: Then how do you explain Dodd-Frank or Sarbanes-Oxley, two of the worst finance pieces of legislation in history?

KW: Yeah, well those are not very good pieces of legislation at all, but they didn’t do the things that Wall Street was really afraid of, which was getting rid of the off-balance sheet stuff…

HH: Okay, hold onto that off-balance sheet stuff. I think we’re going close to Bilderberger land here, and I’m bringing Kevin back. Don’t go anywere, America. His piece is a must-read piece. It’s called Repo Men. It’s over at Nationalreview.com online now.

– – – –

HH: Powerline’s John Hinderaker joins me next hour to talk about his endorsement of Romney today. I’m talking with an anti-Romney guy right now to make sure we have balance. Kevin Williamson is the deputy managing editor of the National Review. His piece, Repo Men, makes quite a vigorous argument against Romney and his sinister ties to Wall Street. Kevin, who are you for?

KW: Well, Hugh, I’m not sure that you actually understand my position here. I’m not really anti-Romney. Out of the major candidates in the race, I’d say Romney’s probably the one who I think would be the most wise to support. But I think that you should yes, be suspicious of what Wall Street wants out of him, and always keep an eye on what these guys are up to. So yeah, I think you misunderstood the piece, and the stuff about the Bilderberger stuff, you just kind of cheesed me off with that. I mean, that’s just…

HH: This is very Bilderbergerish.

KW: No, it’s not.

HH: Oh, it’s absolutely Bilderbergerish.

KW: I’m talking about two very simple things. I’m talking about two very simple aspects of structured finance that should have been looked at when we’re doing these regulations, instead of all the dumb stuff we did. One is the off-balance sheet vehicles, which is what brought down Lehman, and what messed up M.F. Capital, and that stuff, which is where you’ve got giant exposures that due to certain kinds of accounting shenanigans that exploit the way the regulations are written, that allow you to make your books look better than they are, and leverage limits. Those are the two things…

HH: Let me read from Repo Men. “Either way, the last thing Wall Street wants is for the Corzine scandal to launch a new round of frenzied outrage out there in the fruited plains where dwell people who don’t know an IPO from a CDS, and who might suspect something here is not entirely on the up and up. They’re hoping that conservatives can be buffaloed with a cheap bit of free market rhetoric into not noticing that something is excruciatingly amiss here. They are the repo men, headpiece filled with subprime-mortgage derivatives, and they are looking to repossess the Republican party they abandoned in 2008.” That’s Bilderberger, Kevin.

KW: No, it’s not. That’s nonsense. I mean, ask yourself. Why did they give 70% of their donations to Obama last time around? And why are they turning the other way this time? You think it’s just out of goodness of their heart? Or because they’re suddenly, got a case of being pro-life late in life? Or what? Why did they change their mind?

HH: I don’t think they act as a “they.”

KW: You tell me why they changed their mind. I’d love to hear your theory on this.

HH: I don’t think they act as a “they.” What I’m saying is whenever you say “they,” that’s Bilderberger, and it assumes…it’s like when people used to say oh, you believe in a media elite that’s controlling the media. No, I don’t. I believe that there are similarly-situated people who live in certain parts of the country who act certain ways. But there’s no conspiracy, and there’s no Wall Street conspiracy. It’s Occupier stuff.

KW: Well, I’m not saying it’s conspiracy. I’m saying in the aggregate, they behaved one way in 2008, and in the aggregate, they’re behaving a different way this time around. And I assume that there’s a reason for that, and I assume knowing these guys reasonably well, the reason is self-interest.

HH: These guys – how many of them are there?

KW: How many Wall Street employees are there? 200,000 in New York?

HH: When you say these guys, are they in a clubhouse somewhere? I mean, when you say these guys, you’re implying these guys, that there’s a list. How many of them are they? Are they getting together at the Harvard Club on the 3rd floor in the Library Wednesday night for drinks to decide the world? Kevin, that’s what this piece looks like.

KW: Oh, nonsense. I mean, that’s just nonsense. I’m not positing a conspiracy. I’m positing that economic actors are acting in an economically self-interested way, and that the presence of politics in the markets creates opportunities for exploitation.

HH: By these guys, right? All right, Kevin, we’ll continue the conversation in 2012. Don’t go anywhere, America.

End of interview.

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