‘The People’s Senator’ is Heard on the Street

By Sydney H. Schanberg

New York Newsday, October 7, 1986

It is often said these days that the American public has developed such a high level of cynicism about the ethics of its public officials that it maintains exceedingly low expectations of them. Alfonse D’Amato is apparently counting on this cynicism for his re-election.

Two weeks ago, a carefully documented front-page story in The Wall Street Journal said: “As chairman of the Senate banking subcommittee on securities since 1981, the New York Republican has blocked or blunted legislation opposed by Wall Street while reaping a rich flow of campaign money from the nation’s leading brokerage houses and investment-banking firms. The big donations often coincide closely with this legislative actions — or inaction.

The Journal article went on to show that “more than $500,000 has poured into his re-election campaign from the partners, executives and political action committees of Wall Street firms…In some cases, such contributions appear to have been coordinated by management.”

On one occasion, according  to the lengthy article, D’Amato’s top aide, Michael Kinsella, formerly a lobbyist for the Securities Industry Association, asked Drexel Burnham Lambert Inc., the nation’s No. 1 underwriter of the high-yield, high-risk “junk” bonds used to finance corporate takeovers, to organize a fund-raising dinner for the senator. And the firm did. Not long thereafter, a provision bitterly opposed by Drexel and similar firms — which would have severely curbed the use of junk bonds — was conveniently missing when D’Amato introduced his bill to tighten the regulation of corporate takeovers.

The Journal article came to the conclusion that D’Amato — who calls himself “the people’s senator” — “has clearly become Wall Street’s favorite senator.”

Neither D’Amato nor his staff challenged any of the information in the Journal story. They chose instead to attack Mark Green, D’Amato’s Democratic opponent in the Nov. 4 election, after Green homed in on the story and charged that “D’Amato is a senator for sale or rent.” Green also called for federal and state investigations of the senator’s fund-raising and issued a reporting alleging that D’Amato was in the pocket of not just the brokerage community, but several other special interests as well — such as military contractors.

Gary Lewi, D’Amato’s spokesman, called Green’s statements “outrageous” and “an act of political desperation.”

He denied any connection between D’Amato’s legislative activities and his campaign gifts and said: “We are pleased with the support we have received from the financial community in New York and 30,000 other New York contributors.”

But those are not compelling or convincing responses, given the documentation in the Journal article and given the pattern of the senator’s behavior since his election in 1980. He has chased after campaign money with a fervor that has left some of those pursued feeling pressured and intimidated. Later, of course, many of the givers have felt gratitude for the favors he has performed. The $9 million he has raised so far for his re-election campaign — it could easily hit $10 million by Election Day — is a reflection of these successful fund-raising techniques.

In the recently enacted tax overhaul bill, for instance, D’Amato sponsored an amendment giving a special tax break for the luxury office and residential project scheduled to replace the New York Coliseum. A co-sponsor of the project is Phibro-Salomon, the financial service conglomerate. Salomon Brothers, a key part of that conglomerate, has so far given $32,000 to D’Amato.

It cannot be assumed that the public cares much about any of this for it is entirely possible that D’Amato’s calculations about voters are right — that they have become so accustomed to the spectacle of conflict of interest that it rates little more than an everybody-does-it shrug.

If D’Amato were really worried, one would think he would address himself to the damning details of the Wall Street Journal article, which was written by Bruce Ingersoll and Brooks Jackson.

Instead, he has insulted if not our intelligence then his own self-respect by offering buttery, gobbledygook answers to the serious questions that have been raised.

When a reporter asked him about these issues, on WCBS-TV’s “Newsmakers” show on Sunday, D’Amato, with the smoothness of a patent medicine salesman, replied: “Now, in terms of being characterized as Wall Street’s favorite senator, you know, Wall Street is an integral part of the economic vitality of this state. We are the economic center of the world. If I don’t stand up, in the position that I have, to battle for their interests, to work for them, migosh, that would not be doing the business of our state and our people.”

Migosh. And Gee Whiz. Those poor itty-bitty money guys. Who would have thought they were so battered and besieged. Golly Moses, we better pitch right in and battle for them, too — for the benefit of our state and our people. Just like Sen. D’Amato, for goodness sake. 

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