Advertisement
Canada markets closed
  • S&P/TSX

    21,837.18
    -11.97 (-0.05%)
     
  • S&P 500

    5,149.42
    +32.33 (+0.63%)
     
  • DOW

    38,790.43
    +75.66 (+0.20%)
     
  • CAD/USD

    0.7382
    -0.0007 (-0.09%)
     
  • CRUDE OIL

    82.59
    -0.13 (-0.16%)
     
  • Bitcoin CAD

    88,052.81
    -3,999.69 (-4.35%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • GOLD FUTURES

    2,164.60
    +0.30 (+0.01%)
     
  • RUSSELL 2000

    2,024.74
    -14.59 (-0.72%)
     
  • 10-Yr Bond

    4.3400
    +0.0360 (+0.84%)
     
  • NASDAQ futures

    18,186.00
    -45.50 (-0.25%)
     
  • VOLATILITY

    14.33
    -0.08 (-0.56%)
     
  • FTSE

    7,722.55
    -4.87 (-0.06%)
     
  • NIKKEI 225

    39,596.29
    -144.15 (-0.36%)
     
  • CAD/EUR

    0.6788
    -0.0004 (-0.06%)
     

Goldman Sachs helped Hillary Clinton get rich? So what

In April of 2014, Hillary Clinton earned $225,500 for giving a speech to the Institute of Scrap Recycling Industries in Las Vegas. Scandalous? Hardly. Clinton was a private citizen at the time, earning every dollar she could as one of the most popular paid speakers in the world. Her talk to the recyclers generated absolutely no hint of controversy.

A few of Clinton’s other speeches have come back to haunt her, however. Between 2013 and 2015, Clinton earned $3.7 million from 16 speeches she gave to Wall Street firms including Goldman Sachs, Morgan Stanley, Deutsche Bank, and Bank of America. Critics claim those lavish payouts show that big banks have Clinton in their back pockets, a claim Clinton has struggled to refute. When CNN anchor Anderson Cooper asked about three speeches to Goldman Sachs in 2013 that earned her $675,000, Clinton waffled and stoked the controversy instead of quelling it. (A list of all paid speeches Hillary Clinton gave during the last three years is at the bottom of this story.)

The influence of Wall Street banks on American politics is certainly a valid issue, but calling out Clinton’s speeches is lousy logic. Clinton, arguably, put one over on Wall Street by pulling down gobs of easy money for a tiny amount of work. The banks contracted with her to perform a service—give a speech and answer questions—and they paid her what both sides apparently felt was a fair price. That obligates Clinton to nothing beyond fulfilling the job she was paid to do. Once the job is done, she owes favors to nobody. That’s how paid speeches work.

Clinton herself has handled the whole matter as if it’s a scandal, however, revealing the discomfort she feels being tied to Wall Street. To dig into just one detail: When Cooper asked her whether she had to be paid $225,000 per speech by Goldman, she said, “Well I don’t know. That’s what they offered.” That’s baloney. A review of Clinton’s 92 paid speeches from the time she stepped down as Secretary of State in 2013 to the time she declared herself a presidential candidate in 2015 shows her average fee was $234,000 per speech. Speaker bureaus typically negotiate speaking engagements on behalf of high-flying clients such as Clinton, and they don’t accept whatever the group seeking a speaker offers. Instead, they stipulate a minimum fee and work upward from there.

ADVERTISEMENT

Clinton actually undercharged Goldman Sachs, since she was paid $9,000 less than her average fee. The most she got for a speech was $400,000, from the Jewish United Fund in October of 2013. Qualcomm paid her $335,000 in 2014, while eBay paid her $315,000 in 2015. Those groups might have gotten a better deal had they bargained harder.

Giving six-figure speeches is obviously a gig available only to a privileged few. But is there anything really wrong with taking the money? The fees come from private organizations spending their own cash as they wish, not from public funds. Clinton’s fees were set according to the cherished free-market principle of supply and demand, since she could only earn what somebody was willing to pay. And while it’s true that her value as a speaker comes largely from the public offices she has held, there’s a long and legal tradition of cashing in on such service that goes back to the founding of the country.

It would be fishy if Clinton only got paid to speak to one industry or if her fees were notably higher for one group than for others. But Clinton was clearly in high demand, with many organizations in many different fields willing to pay her high fee. Overall, Clinton earned $21 million from speeches between 2013 and 2015. Only 17% came from firms in the financial industry. You might think Clinton would point that out, but maybe she doesn’t want to draw even more attention to her bulging bank account or her lucrative freelance work.

Any other candidate might defend his or her right to make as much money as possible while a private citizen. Donald Trump would probably boast about it and cite the exorbitant speaking fees as evidence of how much people love him. If Clinton were more comfortable being a capitalist, she might come right out and say, “I like being rich, and I want you, dear voter, to get rich too.”

Political donations from Wall Street—and from any other moneyed interest—are a totally different matter and a genuine cause for concern, especially the unlimited amounts of money rich donors can give to super PACs. Such donations do not represent a market price for work performed in a private transaction. At best, they’re an effort to help like-minded candidates obtain public office. At worst, they’re a down payment on favors expected later, whether in the public interest or not. Elections are not supposed to be the same as a product or service priced as high as the market will bear, though many critics feel that's what they've become.

Clinton has accepted her share of donations from financial firms, including big-money contributions to the main super PAC supporting her, Priorities USA. Should she have taken that money? What do the banks expect in return? Those are the questions Clinton ought to be answering.

~~~~~~~~~~~~~~~~~~~~~~~

Hillary Clinton's paid speeches between 2013 and 2015

Rick Newman’s latest book is Liberty for All: A Manifesto for Reclaiming Financial and Political Freedom. Follow him on Twitter: @rickjnewman.