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Democrats may want to start thinking about a bailout for Senate Banking Committee Chairman Christopher Dodd (left), whose political stock has slipped amid the financial meltdown.
As a five-term Democrat who blew out his last two opponents by 2-1 margins in a blue state that President Barack Obama won handily, Dodd, D-Conn., should be cruising to re-election in 2010. Instead, he’s feeling heat from a Republican challenger eager to make him a poster boy for the tumult in the housing and financial markets.
A recent poll showed former Rep. Rob Simmons running about even with Dodd, a former national Democratic Party chairman.
As head of the banking panel, Dodd, 64, has become a convenient target for voter anger over the economic crisis.
"The fact that we have been beaten up, beaten around the head for the last eight or nine months on a regular basis has contributed to it as well," Dodd said.
Some of the worst blows came amid the furor over $165 million in bonuses American International Group Inc. paid some of its employees while receiving billions of dollars in federal bailout money. After first denying it, Dodd admitted he agreed to a request by Treasury Department officials to dilute an executive bonus restriction in the big economic stimulus bill that Congress passed last month. The change to Dodd’s amendment allowed AIG to hand out the bonuses and sparked a blame game between Dodd and Treasury Secretary Timothy Geithner.
Dodd was guarded Thursday when asked about Geithner.
"This is obviously a matter that obviously should have been dealt with differently, but we are where we are," he said.
Republicans branded Dodd’s reversal "astonishing and alarming" and fingered Dodd as the top recipient of campaign cash from AIG employees over the years.
The GOP is slamming Dodd, claiming he is cozying up to Wall Street insiders, raking in bundles of their campaign cash, shirking his banking panel duties and running for president as the economic crisis erupted in 2007.
He’s also under investigation by a Senate ethics panel for mortgages he got from Countrywide Financial Corp., the big lending company at the center of the mortgage crisis.
A takedown of a national party figure like Dodd would be a coup for Republicans eager to rebound from their recent congressional losses.
"This is a state we will be actively participating in," said Amber Wilkerson, a spokeswoman for the National Republican Senatorial Committee.
Republicans are also turning a spotlight on Dodd’s longtime friendship with Edward Downe Jr., a former director of the Bear Stearns investment firm who was snared in an insider trading scandal. Dodd owned a condo with Downe in a fashionable Washington neighborhood but bought out Downe’s share in 1990 after learning Downe was under investigation. Downe eventually pleaded guilty to trading inside information.
During the final days of the Clinton administration, Dodd wrote a letter supporting a pardon for Downe. "Mr. President, Ed Downe is a good person, who is truly sorry for the hurt he caused others," Dodd wrote. The pardon was granted.
Dodd complained that the GOP is repackaging old stories.
"They’re trying to weave things together that have been reported on widely over the years," Dodd said. "They are taking some items that are frankly, old news, routine transactions, and trying to make more out of it."
Dodd has acknowledged participating in a Countrywide VIP program, which he said he thought referred to upgraded customer service. He denied asking for or receiving any special treatment when he refinanced his homes in Washington and East Haddam, Conn., in 2003.
"There was no sweetheart deal," Dodd said.
He faced criticism in his home state for not releasing details of his mortgages until several months after the controversy surfaced last summer. He concedes his sluggish response was a mistake.
The Countrywide controversy came after a failed presidential bid by Dodd that soured many Connecticut voters because he was out of state campaigning so much.
Dodd moved his family to Iowa for several weeks before the caucuses, adding to the home-state backlash.
Simmons is a former CIA officer who served three terms in Congress representing a Democratic-leaning district. He’s a fiscal conservative who split with his Republican Party on issues such as abortion rights and raising the minimum wage. He lost by 83 votes to Democrat Joe Courtney in 2006.
In a hypothetical 2010 matchup, a recent Quinnipiac University poll showed Simmons with 43 percent of the vote and Dodd with 42 percent, a statistical dead heat.
Democrats said they’re confident Dodd will rebound in the coming months. They note he has strong support among party activists in the state as well as nationally. Simmons could face a tough primary fight if other Republicans jump in, Democrats add.
"Senator Dodd will be fine when all the dust settles," said Nancy DiNardo, chairwoman of the Connecticut Democrats. "People are just really upset with everything that’s happening" with the economic crisis.