---

Schumer's racket: Lobbyists and hedge funds
Three years ago, Sen. Chuck Schumer, D-N.Y., leaned on hedge funds to lobby more. The funds soon hired his banking staffer as a lobbyist. She began raising money for Schumer. Now he's championing financial regulation that would benefit these hedge funds. "Racket" might be the right word here.

Here's the story: In January 2007, the month Democrats took control of Congress, Schumer invited hedge funds executives to dinner, where, the New York Times reported, he "had some simple advice for the billionaires in his midst: If you want Washington to work with you, you had better work better with one another."

Until then, hedge funds had largely minded their own business. But in the 2008 elections, they tripled their previous contributions to politicians, with Schumer and Barack Obama as their favorites, along with other Senate Democrats (Schumer was head of the Democratic Senatorial Campaign Committee).

But more to Schumer's point, the hedge funds shifted their lobbying into high gear. After spending less than half a million in 2006, they spent more than $6 million in 2007....

...But how did Schumer benefit from his January 2007 meeting with the hedgies? How does Schumer always benefit? Fundraising. Democrats in 2008 brought in $11.7 million from hedge funds, nearly twice the GOP haul....