It seems like Hillary Clinton might be about to hurt Wall Street, but only because she loves it so much.
The presumptive Democratic nominee has been indelibly marked with the "too close to Wall Street" tag, a scarlet letter that burns ever brighter with Vermont socialist Bernie Sanders and desparately anonymous Marylander Martin O'Malley taking shots at her from the left. While very few actually believe that challenges from within her own party have her genuinely reevaluating her platform, according to Politico there appears to be some burgeoning fear in the C-Suites that Hillary will start to publicly criticize Wall Street over the coming weeks just to look a little more blue.
Some on Wall Street think powerful populist pitches from O’Malley and Sanders coupled with the heavy influence of noncandidate Sen. Elizabeth Warren could force Clinton to come out harder on issues including breaking up the nation’s largest banks, imposing a financial transaction tax, putting individual bankers in jail, cracking down on executive pay and otherwise beating up on an industry that six years after the financial crisis still suffers from rock bottom public opinion ratings.
It wouldn't be the classiest thing for Clinton to punch down on the unpopular financial sector, especially considering that is has given her rather broad support as a US Senator from New York and two-time presidential candidate. But it's early in a long campaign and she would be happy to quickly neuter at least one of O'Malley or Sanders, so taking some pot shots at hedge funds and big banks might just be on the menu.
Many big money managers say it is inevitable that Clinton will have to come out with a tougher program on Wall Street reform than anything she’s said so far or risk dispiriting the base she is counting on to hand her the nomination and then drive her into the White House next fall.
That said, there will be repercussions for Hillary if she starts slapping with her taking hand.
Clinton aides and outside advisers alike acknowledge that the candidate is “in a box,” as one donor put it, when it comes to financial reform. If she goes at it too hard she could scare away donors. If she goes too soft she risks alienating the left in potentially damaging ways for a campaign that is relying on the left-leaning Obama coalition to win.
Considering that Jeb Bush will be there to eagerly lap up any checks that fall outside Clinton's box, Hillary needs to play it smart on what exactly she'll do to show that she's not Wall Street's Girl Friday.
No decisions have been made on exactly what to include in a major speech on financial reform, though things like a financial transactions tax — pushed in the past by President Barack Obama but reviled by Wall Street — remain possibilities, aides and outside advisers said.
It’s also not clear how hard she will hit bankers themselves, though she is expected to continue to stress the theme of how the deck is currently stacked in favor of those at the top, an oblique reference to Wall Street.
Staying as oblique as possible would be wise at this juncture considering that her campaign's senior staff is littered with a few Goldman Sachs alums and her post-State Department career has been more than a little buoyed by the largesse of a lot of the same people she's about to go after.
If they're honest, Hillary's top advisors are just hoping to navigate this tricky passage of the campaign while hoping that Ohio Republican Governor John Kasich finally gets in the race and does well enough to be Clinton's opponent in the general election.
That dream scenario allows Hillary to stand up at the first debate, point across the dais and say "You think I'm too close to Wall Street? He worked for f*cking Lehman!"