Lawless Capitalism

Professor Steven Ramirez

As teased earlier this week, the NYU Press has just announced the release of blog contributor Professor Steven Ramirez's new book "Lawless Capitalism."  This book offers an insightful and surgical examination of the subprime crisis of 2008, and more than simply identifying causes, offers a new economic rule of law suggesting a fairer and more economically just way forward.

From the Back Cover:  "Professor Steven Ramirez's Lawless Capitalism is a tour de force. The pages are virtually crackling with urgency and deeply considered alternatives to the wayward capitalism currently practiced in the United States. Ramirez, in his critical contribution to the ongoing debate in connection with free markets and governmental regulation, envisions a new and different kind of capitalism. Ramirez's capitalism  respects individual potential and human capital, considers equality and fairness, and promotes the abilities of all people, rather than focusing on deeper entrenchment of the elite. Lawless Capitalism meticulously weaves the best thinking of dozens of economists, law professors, sociologists and philosophers into a new conceptualization of an economic rule of law, one that Ramirez fully develops, that offers a better economic way for our nation and the world. Lawless Capitalism is an important book, representing a powerful new voice that literally demands to be heard."
-andré douglas pond cummings, Indiana Tech Law School

"Capitalism and the profit motive can stimulate human productivity and innovation.  But they can also lead to corruption, shady politics, and self-dealing. This brilliant book shows how intelligently designed laws and lawsuits can facilitate the former and discourage the latter. . . . Steven Ramirez is the new Andrew Hacker.  He wields statistics, numbers, and concepts like a scalpel."
-Richard Delgado, co-author of Critical Race Theory

"Ramirez catalogues the many ills and failures in the American economic system, casting a broad net that implicates governing institutions, political and corporate elites, and their policy agendas. He provides a valuable contribution to discussions on reforming capitalism and restoring the foundations of middle class prosperity through a renewed commitment to transparency, economic democracy, and the rule of law."
-Timothy A. Canova, Nova Southeastern University

From the NYU Press abstract: "The subprime mortgage crisis has been blamed on many: the Bush Administration, Bernie Madoff, the financial industry, overzealous housing developers.  Yet little scrutiny has been placed on the American legal system as a whole, even though parts of that system, such as the laws that regulate high-risk lending, have been dissected to bits and pieces.  In this innovative and exhaustive study, Steven A. Ramirez posits that the subprime mortgage crisis, as well as the global macroeconomic catastrophe it spawned, is traceable to a gross failure of law.


The rule of law must appropriately channel and constrain the exercise of economic and political power.  Used effectively, it ensures that economic opportunity isn't limited to a small group of elites that enjoy growth at the expense of many, particularly those in vulnerable economic situations.  In Lawless Capitalism, Ramirez calls for the rule of law to displace crony capitalism.  Only through the rule of law, he argues, can capitalism be reconstructed."

Available here:  Lawless Capitalism: The Subprime Crisis and the Case for an Economic Rule of Law

Election 2012: Death of the Southern Strategy?

Originally posted at NYU Press, From the Square Blog, on November 21, 2012.

 

For many decades the GOP played the politics of racial divisiveness to further the cause of tax cuts, deregulation and a more limited federal government. The election of 2012 promises to end this ugly chapter in American politics. The ultimate outcome will change our political landscape in far-reaching ways.

Surprisingly, Republican leaders openly admit that their party used race to appeal to white voters (particularly in the old Confederacy) disaffected with the perceived embrace of racial equality within the Democratic Party. Republican strategist Kevin Phillips openly admitted to seeking out the votes of “negrophobe whites” in the New York Times in 1970. The Nation very recently posted the actual audio recording of Reagan Administration Official Lee Atwater articulating how the GOP implemented the Southern Strategy in sordid (and highly offensive) detail in 1981. Atwater unabashedly ties the politics of race to economic issues such as tax cuts. Two Republican National Committee Chairs actually apologized for the Southern Strategy.

In my book Lawless Capitalism, I argue that the politics of racial division led directly to the subprime debacle through massive financial deregulation beginning in the Reagan Administration. Deregulation of mortgage lending, the basic structure of globalization, and financial consolidation all find their roots in the Reagan Administration. Indeed, the fundamental explosion in American debt started in 1980.

To be fair, the Democrats contributed much to the crisis too. The crisis resulted from longstanding and bipartisan policies. Nevertheless, the Southern Strategy dominated the political scene in the decades preceding the subprime debacle.

The election of 2012 may spell the end of the Southern Strategy, at least as a means of GOP success. African American and Latino voters turned out in record numbers. Asian American voters supported President Obama over Mitt Romney by 73-26, a margin that exceeds Obama’s advantage among Latino voters.

The viability of the GOP’s Southern Strategy will continue to fade. Asian Americans form the fastest growing minority group in the nation. A recent study by the Pew Hispanic Research Center projects that the voting power of Hispanics will double by 2030—to nearly half of the electorate. If the Democrats continue to run candidates of color to energize this base, then these growing voting groups will constitute a formidable foundation for a durable Democratic majority. Meanwhile, the GOP base still today favors discriminatory practices, such as anti-immigration laws and legislation designed to suppress the vote of minority communities.

On issues relating to immigration, education, voting rights, the war on drugs, and many others, a fundamental change in political calculus is afoot. I contend the change may be even more monumental than such core issues. Ultimately, without the ability of governing elites to use the politics of racial division to further their interests, the very high level of economic inequality currently burdening our nation may be unsustainable.

Steven A. Ramirez is Professor of Law at Loyola University of Chicago, where he also directs the Business and Corporate Governance Law Center. His book, Lawless Capitalism: The Subprime Crisis and the Case for an Economic Rule of Law, will publish in December 2012.

Corporate Sponsorships and the Power of the Boycott

Extraordinarily interesting news out of England and the Premier League last month:  Several members of the Newcastle United Football Club may refuse to wear the corporate logo of Wonga, a short-term, pay day loan company, on their game jerseys because Wonga's company practices are an affront to their religious beliefs.  Newcastle United FC recently announced a corporate sponsorship agreement with Wonga.

Newcastle footballers Demba Ba, Papiss Cisse, Cheick Tiote and Hatem Ben Arfa are all practicing Muslims. "Under Sharia law, Muslims must not benefit from either lending money or receiving money from another person - meaning that interest is prohibited. Interest is not paid on Islamic bank accounts or added to mortgages." Because Wonga is seen by many in the UK, much like pay day loan companies in the United States, as established to prey on the poor and the unbanked, Ba, Cisse, Tiote and Ben Arfa may refuse to promote its practices by refusing to display the Wonga logo on their jerseys.

From the story in the Daily Mail:  "Shaykh Ibrahim Mogra, assistant secretary general of the Muslim Council of Britain, told The Independent: 'There are two aspects to this. We have the rulings of the religious law and we have the individual’s choice and decision on how they want to follow or not follow that rule. 'The idea is to protect the vulnerable and the needy from exploitation by the rich and powerful.' 'When they [Wonga] are lending and are charging large amounts of interest, it means the poor will have short-term benefit from the loan but long-term difficulty in paying it back because the rate of interest is not something they can keep up with. The Islamic system is based on a non-interest-based system of transaction.'"

Demba Ba, Newcastle United FC

In fact, on some short-term loans, Wonga charges an interest rate that would annually exceed 4,000%. "Should a Newcastle fan accept a loan to buy a £50 club shirt, they would have to repay £71.92 after a month with a rate equivalent to 4,212 per cent per year."  Local politicians in Newcastle were aghast to learn that Newcastle United had partnered with a corporate sponsor such as Wonga: "Nick Forbes, the leader of Newcastle City Council, said: 'I’m appalled and sickened that they would sign a deal with a legal loan shark. It’s a sad indictment of the profit-at-any-price culture at Newcastle United. We are fighting hard to tackle legal and illegal loan sharking and having a company like this right across the city on every football shirt that’s sold undermines all our work.'"

Boycotting a corporate sponsor would be deemed a hugely controversial move in the United States. In fact, the activist athlete has been discussed on the Sports Law Blog many times over the years, and has seemed to be in decline since the advent of the corporate endorsement and the potential to profit in the dozens of millions of dollars. That said, there appears to have been a rise in athlete activism in recent months . . . .

In addition, pay day loan companies have been harshly criticized in recent months as predatory lenders and are typically found only in poor or run down communities.  The Consumer Financial Protection Bureau, the brainchild of new Massachusetts Senator Elizabeth Warren, has vowed to rein in and regulate pay day loan shops in the United States.  Clearly, pay day lenders are controversial "across the pond" as well.


cross-posted on the Sports Law Blog
(photo of Demba Ba courtesy of Creative Commons and Egghead 06)  

Why President Obama Must Deal with the Megabanks

The megabanks threw President Obama and the Democrats under the bus during the election of 2012 and doubled down on the GOP. With virtually zero hedge, they were all in with Mitt Romney. All of Romney's top 6 supporters were megabanks, as were 9 of his top 12. Three of his top 12 supporters were foreign megabanks. Further, the financial sector spent over $52 million supporting Mitt Romney. The securities industry spent $20 million supporting Romney. So, big finance was Mitt Romney's biggest supporter.

President Obama, on the other hand, owes the megabanks nothing. Not a single megabank was among his top 15 supporters. Finance spent three to one in favor of Romney. The megabanks also strived mightily to deny the Democrats the senate. They spent millions supporting GOP candidates against Elizabeth Warren and Sherrod Brown. So, one major consequence of this election is that President Obama and the Democrats owe the megabanks nothing.

The megabanks still threaten our economy and still play with excessively risky derivatives as proven by the recent multi-billion dollar derivatives loss suffered at JP Morgan Chase and the failure of MF Global arising from excessively risky bets on Eurozone debt. The essential problem is that because they are perceived to be too big to fail creditors lend them money on cheaper terms and management is thereby enticed to take on more risk. Further, since they gorge on cheap debt they naturally become ever larger and too complex to manage. Only fragmenting the megabanks will cut off their supply of cheap capital. 

As NYU economist Nouriel Roubini puts it: "The only solution to to break up too big to fail banks.There is no other alternative. We have to go back to Glass-Steagall. I would have thought after the worst global financial crisis in a generation, the decision would have been made. Maybe we need another big financial crisis." 

MIT economist Simon Johnson states: "There are large implicit government subsidies available if your financial institution is perceived as too big to fail. These subsidies -- in the form of implicit downside protection or guarantees for creditors -- drive up size and exacerbate complexity." 

These are two of the finest economists of our time and each boasts huge credibility. Johnson is the former Chief Economist of the IMF and author of the definitive study of the hazards of an excessively large financial sector, Thirteen Bankers. Roubini famously predicted the financial meltdown in great detail as early as 2005.

Nor are these two outstanding economists alone in recognizing the threat posed by the megabanks. University of Maryland economist Peter Morici: "The real solution in the banks is not all of this excessive regulation, but to bust up the big banks. The fact is not only are they too big to fail, but because they're too big to fail, they're too big to effectively regulate. That's why there's no lending and they continue trading." Even former Fed Chair Alan Greenspan, who actually presided over much of the growth of the megabanks, now recognizes that they must be allowed to fail. Mainstream economics has achieved rare consensus: too big to fail banks present a clear and present danger to the economy and must be eliminated from the system.

I cannot count the number of posts on this blog protesting the socialization of financial risk in our economy under the guise of too big to fail. I have also written numerous law review articles criticizing the continuation of too big to fail. But, without the right political context all the academic analysis is meaningless.

I believe that President Obama faces an historic opportunity to address the scourge of the megabanks. This is a compelling economic issue. He is a lame duck who owes the big banks nothing. Huge popular support would back any move to end too big to fail. Here are the most promising and straightforward mechanisms available to tame the megabanks: 

1)  Amend section 121 of Dodd-Frank to allow the government to more easily break up the megabanks. Specifically, change the requirement of 2/3 approval of the Fed Board of Governors to a simple majority. Further, allow the Fed to order divestiture of operating divisions of megabanks without having to show that other alternatives would be inadequate. Finally, delete the term "grave" and allow the Fed to break-up any megabank that threatens the financial stability of the US. (They all already pose a grave threat).

2) Amend section 203 of Dodd-Frank to allow the FDIC to take a megabank into orderly liquidation (i.e., receivership) solely based upon a determination by the Treasury Secretary that the firm faces a high risk of default. This would eliminate the need to get a 2/3 vote by the Fed and the FDIC.  It would also help to short-circuit any judicial review.

3) Appoint a truly tough minded financial expert as Secretary of Treasury. The best appointment would be Sheila Bair. As a Republican, she would bring immediate bipartisan credibility on a range of important economic issues. As former FDIC Chair, she understands banking and was a consistent voice for tough reforms. She has a new book out that pulls no punches. Her appointment as the first woman to head Treasury would also help the Democrats to continue to earn the support of women politically.

Of course, perhaps the reinstatement of the Glass-Steagall Act would be the most certain means of taming the megabanks.

In any event, President Obama holds a huge opportunity to impose rational policy and achieve a superior political outcome for Democrats, all at once. He must get tough on the megabanks. My next post will further this basic point in the specific context of corporate governance.

“The real solution in the banks is not all of this excessive regulation, but to bust up the big banks. The fact is not only are they too big to fail, but because they're too big to fail, they're too big to effectively regulate. That's why there's no lending and they continue trading. You know with their profits down, bonuses will be up again for CEOs.”

Read more: Morici: Big Banks Are ‘Too Big to Effectively Regulate’
Important: Can you afford to Retire?

“The real solution in the banks is not all of this excessive regulation, but to bust up the big banks. The fact is not only are they too big to fail, but because they're too big to fail, they're too big to effectively regulate. That's why there's no lending and they continue trading. You know with their profits down, bonuses will be up again for CEOs.”

Read more: Morici: Big Banks Are ‘Too Big to Effectively Regulate’
Important: Can you afford to Retire?

http://www.businessinsider.com/roubini-says-break-up-the-banks-2012-10#ixzz2CeEk8bCk

The only solution to to break up too big to fail banks. There is no other alternative. We have to go back to Glass-Steagall. I would have thought after the worst global financial crisis in a generation, the decision would have been made. Maybe we need another big financial crisis.

Read more: http://www.businessinsider.com/roubini-says-break-up-the-banks-2012-10#ixzz2CeEk8bCk

The only solution to to break up too big to fail banks. There is no other alternative. We have to go back to Glass-Steagall. I would have thought after the worst global financial crisis in a generation, the decision would have been made. Maybe we need another big financial crisis.

Read more: http://www.businessinsider.com/roubini-says-break-up-the-banks-2012-10#ixzz2CeEk8bCk

Election Outcomes

Several frightening outcomes have surfaced following last week's presidential election.  Of course, many very positive takeaways have emerged as well, with Professor Steve Ramirez writing about two of them in this Corporate Justice space.  Yet, the frightening outcomes appear to show that our nation remains deeply divided along racial and class lines.

Following the election, statisticians and social media analysts got busy and turned up the following two charts, which should give Americans everywhere pause. First, the chart below shows that we are most definitely not a post-racial place, as evidenced by the number and intensity of racist tweets that were sent on election night following President Obama's re-election.

The next chart shows how the state's with the most educated populations voted, versus how the state's with the least educated populations voted for president.  How "educated" a state is was determined by percentages of citizens 25 years of age and older with a college degree or more.

These two charts seem to evidence that our nation remains deeply divided, both on issues of race and of class.  Racist tweets in the deep south were prevalent, most obviously in Mississippi and Alabama following President Obama's re-election success.  Still, racist tweets were evident throughout the nation.  Further, if "education" level is to be measured by college degree, then those states with the most college graduates voted overwhelmingly for President Obama, where those states with the fewest college graduates were nearly as overwhelmingly in support of Mitt Romney.  We must continue to try to bridge divides in the United States by honestly confronting issues of festering racism and poverty.

Why President Obama Should Get Behind Weed

A recent poll shows that a clear majority of American voters support legal and regulated marijuana by a margin of 56 to 36. Other polls show similar results, but even weaker opposition. Further, some of President Obama's key constituencies favor legalized marijuana by even greater majorities: 69% of liberals favor legalization; 62% of younger voters favor legalization; and, 57% of moderates, independents and Democrats favor legalization. Only southerners, the elderly, and conservatives strongly oppose legalization. In Colorado both women and Latino voters supported legalization last Tuesday. Medical marijuana consistently enjoys even stronger support of up to 80% of voters.

Moreover, it appears that including ballot initiatives relating to marijuana enhances voter turnout, particularly among young voters. "In the three states with marijuana legalization initiatives on the ballot, Colorado, Oregon and Washington State, there was a significant surge in the voters age 18-29. In 2008 young people made up just 14 percent of the vote in Colorado but this year it was 20 percent. Even more incredibly, in Washington State the youth vote went from just 10 percent of the electorate last election to 22 percent this time." In Massachusetts, voters "turned out in droves" to approve a medical marijuana ballot initiative.

President Obama should immediately reverse his hardline stance on the War on Drugs and instead return the issue of marijuana to the states to determine democratically. According to Rolling Stone: "the Obama administration has quietly unleashed a multi­agency crackdown on medical cannabis that goes far beyond anything undertaken by George W. Bush." In 2010, President Obama renominated a Bush holdover to head the DEA. Ever since the administration has aggressively use a variety of federal sanctions to shutter medical marijuana dispensaries. Recently, the Feds sentenced a medicinal pot provider to 80 years in prison.


The War on Drugs is a dismal failure that disproportionately penalizes communities of color. Even though whites use marijuana at rates that exceed usage among Latinos and African Americans, people of color are arrested at rates that can only be termed outrageous. In Colorado, Latinos were arrested at 1.5 time the rate as whites and African Americans at 3 times the rate as whites. In California, minorities are arrested at up to 12 times the rate of whites. In New York City, the War on Drugs has become a War on Weed--waged primarily on minorities--as shown in the chart at right.

This war is an economic catastrophe. If weed were legal and taxed like alcohol or tobacco it would lead to total government savings of about $7 billion and another $7 billion in revenues.  If marijuana were the same size as the alcohol industry it would amount to $150 billion per annum--and that means jobs.

In terms of costs, even the government's own studies suggest that costs are low or zero, and certainly less than those associated with tobacco and alcohol use. Moreover, there is little evidence that making pot illegal reduces usage. In fact, in the Netherlands, where marijuana is legal, usage is a fraction of that in the US. Therefore, a policy of allowing states to determine whether marijuana should be legal, illegal, or somewhere in between could be costless.

President Obama holds the power to issue a New Emancipation Proclamation with respect to marijuana. As president he can direct the Attorney General to remove marijuana from the list of Schedule I narcotics (which includes drugs like heroin and LSD) under 21 U.S.C. §811. This would immediately pave the way for medicinal marijuana which is now legal in 20 states and the District of Columbia. He should also direct a multi-agency review to assure the federal government's policies accommodate state medical marijuana laws. Finally, he should mandate an in-depth study on whether the federal government needs to regulate marijuana at all, as opposed to leaving it up to the states.

There are around 50,000 Americans in prison for pot-related offenses. The American taxpayer pays over $30,000 per year per inmate to incarcerate these citizens. Countless others have been disenfranchised for marijuana offenses. It makes no sense to continue this prohibition economically, politically or morally.

President Obama and the Democrats generally need to end the War on Drugs, starting with medical marijuana.

Election 2012: Obama 332 and Romney 206

Tuesday's election heralds a fundamental shift in our democracy. The map above shows the shrinking electoral base of the GOP. Even an incumbent facing 8 percent unemployment and a population still riddled with racism won handily.

Four years ago, I reported from Grant Park that: "The Grant Park crowd was one of the most diverse crowds I have ever seen, from all demographic perspectives. On the way to the party we passed a Young Republican event. It was perfectly white and 85% male. Barack took 95% of the Black vote; 66% of the Hispanic vote; 56% percent of the female vote; 69% of new voters; and 66% of voters 18-29.  That adds up to a historic coalition that could prove durable for many election cycles yet to come.  Indeed, the one age group McCain won was voters over 65."

At Tuesday's celebration at McCormick Place, a more powerful demonstration of that reality displayed itself. The energy and determination of Obama's supporters saved the Democrats and not even a hurricane of big money could stop them. In fact, the big money back-fired as people voted against the candidates most supported by big money, which I will be writing about soon. I met middle class people who scraped to the bottom of their monthly budget to give money to President Obama's campaign.

But the big story of the night was the diversity of the President's supporters. It was a beautiful crowd. The only Americans I did not meet there were wealthy, old, white males. They apparently had monopolized the Romney gathering in Boston.

In sum, I saw intense energy and diversity on display Tuesday at McCormick Place. This election provides a virtual road map to future Democratic victory.

Here are the hard facts of the power of diversity for the Democrats: Obama won woman voters by a 55-44 margin; African Americans by 93-7; Latinos by 71-27; and Asian Americans by 74-25. He also carried the youngest voters by 23 percentage points. Notably, Obama also won the votes of the highly educated by 55-42. This coalition is not going away and the GOP should come to grips with this reality, although they utterly failed to see its implications after 2008.

Indeed, looking at the map above, Texas seems poised to become the next  battleground state that used to vote solidly Republican. In Texas, Latinos now comprise 25% of voters. Texas also includes major urban areas, a demographic that voted overwhelmingly for Obama.

In coming days, I will write about many dimensions of all of this, including: the need for the GOP to abandon its collapsing Southern Strategy (particularly its voter suppression efforts); its manifest hostility to Latino voters; its excessive reliance on big oil and big finance; and the opportunities for a new progressive coalition that puts broad-based economic growth front and center.

Today, the emphasis is the power of diversity at the polls. As former GOP Chair Michael Steele put it: "Every month 50,000 Hispanics turn 18 years old, what is the Republican Party going to do about that?"

Obama, Romney and Mancur Olson

I posit that today in America the debates, the stump speeches and the TV ads all have almost nothing to do with how a given candidate actually governs. The stakes are simply so high that one should expect that what is really important is not the hyper-marketing that each candidate projects (now very often differing from audience to audience) but rather commitments made to those expending large sums to propel "their" candidate into office. The voting public has no ability to force elected officials to respect campaign rhetoric and promises. In today's money driven political system the best way to determine what a candidate intends to do if elected is to focus on the money behind the candidate. Large contributors hold enforcement mechanisms that the public does not.

First, almost always politicians must return to the money trough again and again. On the other hand, the public has a notoriously short memory and 85-90 percent of the vote is locked-in to either the GOP or the Dems. So, most voters will stick with their guy regardless of whether the candidate is an etch-a-sketch.

Second, over time these candidates become more dependent upon big money interests than mere campaign contributions may reveal. Their entire social and professional network will ultimately consist of those who will help them most--and that inevitably means well-connected wealthy people like CEOs. After all, its fun to hob-knob with wealthy folks, and who wants to alienate their rich friends?

Third, it hard to overstate the impact of the Citizens United decision. For example, Chevron just gave a pro-GOP Super PAC $2.5 million. Corporate titans can now make or break politicians, their friends, their family and their followers. Few would risk the wrath of the new potentates.  They now have the power to crush opponents right up to election day.

All of this gives our so-called leaders powerful incentives to tell the voting public whatever they want to hear while doing what is needed to assure the continue flow of corporate patronage for themselves and their pals.

Rather than thinking of politicians as autonomous agents with the power to unilaterally change the fundamentals of our society, we should understand that the higher they reach on the political ladder the more likely it is that they succumb to clear incentives to guard the interests of the most privileged in our society, especially under conditions of high inequality. This is the basic teaching of Mancur Olson. As more wealth is concentrated in fewer hands the costs of organizing politically plunge because fewer numbers means lower organizational costs and less temptation toward free riding. Notably, Olson suggested that in a democracy the voters can resist the tendency of special interests to subvert law and regulation for profit (and incidentally destroy capitalism by rigging the system). Voters need only to recognize the negative economic influence of concentrated interests, and vote against the candidate most beholden to such interests.

We live in the age of a new corporatocracy dominated by CEOs. And, as the chart below makes clear, today CEOs of large public firms make more money and control more wealth than any class of royalty from our feudalist past:

Basically since the mid-1980s, CEO compensation has increased by a factor of 10 in real terms. In 2011, executive compensation set new records. So, the real question facing voters today s whether they vote for candidates supported more by big money or candidates supported less by big money. Or, stated differently, the question is which candidate is beholden to which CEOs.

I made this very argument on the NYU Press blog where I tied my forthcoming book, Lawless Capitalism, in a concrete way into the election. My argument there focused on the financial sector which expended $52,000,000 to elect Mitt Romney (compared to $19 million for Obama). So, big finance is behind Romney loud and clear. All voters in favor of more lax financial regulation and letting the megabanks run amok again should definitely vote for Romney.

The next most important difference in funding sources is Big Oil. Here, Romney holds a 5 to 1 fundraising advantage. So what would Big Oil CEOs want? High gasoline prices lead to high CEO compensation. Naturally then CEOs of big oil companies want price spikes in gasoline.

Obama's number one industry is education where he holds a 6 to 1 fundraising advantage over Romney. Both Harvard and the University of California rank on Obama's top 5 sources of support. (Romney's top 5 supporters are all megabanks). Does this mean more money for basic research, more financial aid for students, loan forgiveness programs or something else? Hard to say. It could just be a bunch of professors expressing their own political preferences.

But one thing is certain. Romney is funded more by large contributors and Obama is funded more by small individual contributors, as is clear from this Opensecrets.org webpage.

Further, it is certain that President Obama will not need to raise any more money after November 6.

It is therefore fair to say that Governor Romney is the candidate of big corporate money, especially the megabanks and Big Oil. He is the candidate of the CEOs.