By Gregory B. Hladky
11:59 AM EDT, July 25, 2013
Of course, it's always nice when one of Connecticut's billionaires is getting lots of national attention, and in this case it's our richest resident: Stephen A. Cohen.
Cohen is a denizen of Greenwich and founder of SAC Capital Advisors, one of the nation's biggest hedge funds. And it's his company that's triggered all the headlines. Well, the feds decision to indict Cohen's operation is the real reason for this round of not-so-delightful publicity.
SAC is accused of making hundreds of millions of dollars illegally through wire fraud, etc. Cohen himself hasn't actually been indicted.
Here's the Advocate's story from 2010 about what Cohen and Connecticut's other richest folks were doing with their political contributions:
One of the crunch issues in this recessionary election year, with millionaires running for high office and massive public deficits everywhere, is whether we should eliminate tax cuts that have been very, very kind to the very, very wealthy. Connecticut’s über-rich don’t want to discuss that particular issue. Nor do most of them seem to be using their immense fortunes to directly support Connecticut candidates in the hot races of 2010.Unless you’ve been paying close attention to the Forbes “400 Richest Americans” list, you may not be familiar with the 10 wealthiest people in Connecticut, which is always ranked as one of the wealthiest states in the nation.Their names are Steven Cohen, Ray Dalio, Paul Tudor Jones II, Edward Lampert, Peter Buck, Stephen Mandel, Thomas Peterffy, Karen Pritzker, Richard Chilton and William Macaulay. All of them either ignored requests for interviews or declined to discuss their stands on taxation or Connecticut politics.None of them are politically famous, like liberal billionaire George Soros or right-wing industrialists David and Charles Koch, who have given hundreds of millions of dollars to influence the course of public policy. But our local cadre of the obscenely wealthy do tend to contribute to candidates and political action committees, and that can offer at least some insights.As a group, the 10 richest folks in the state (not surprisingly) tend to be headquartered in Greenwich, have made their money on Wall Street, are all white and nearly all male. Nor is there any doubt they, like a great many of this state’s wealthy, have all benefited from those Bush-era tax cuts.According to Connecticut’s tax agency, there were 233 people in this state who reported annual incomes of $2 million or more in 2004. By 2008, that number had mushroomed to 3,953.An analysis by the Connecticut Mirror found this state’s wealthiest households experienced a six-year growth in income that was more than five times that of the average taxpayer. Taxpayers earning more than $1 million a year saw their adjusted gross income explode by 230 percent between 2002 and 2008. Connecticut residents earning less than $1 million reported an income growth of just 21 percent over that period.It’s not only the federal tax cuts that have helped the rich get richer in this state. Connecticut’s high-end state income tax rate of 6.5 percent is lower than New York’s (where the top rate is 8.97 percent), New Jersey’s (10.75 percent), or Rhode Island’s (9.9 percent). There is a lower income tax rate to the north in Massachusetts (5.3 percent), but that state still has a capital gains tax, something Connecticut got rid of when it adopted the state income tax in 1991.With Connecticut staring down the fiscal gunbarrel of a projected $3.4 billion state deficit, lawmakers are certain to be looking at tax increases next year. But the latest discussion has focused on upping the state’s 6-percent sales tax, which is considered far more onerous for middle- and low-income folks than the income tax. Connecticut’s gubernatorial candidates — to no one’s surprise — would rather talk about spending cuts than tax increases.
At the top of Connecticut’s income heap are people like Steven A. Cohen, founder of the huge hedge fund SAC Capital Advisers. In 2006, Forbes estimated his personal fortune at $3 billion. The magazine’s most recent estimate puts Cohen’s current wealth at $6.4 billion, making him the richest guy in Connecticut. Cohen, his wife Alexandra and their children live in a 35,000-square-foot home in Greenwich.In a July 2006 Vanity Fair article, the writer said the estate “resembles Buckingham Palace or Windsor Castle.”Among other features, the Cohens’ abode has a 6,734-square-foot ice rink (with its own Zamboni machine, of course), an indoor pool, a basketball court, a two-hole golf course, as well as massage and exercise rooms. Cohen’s political contributions tend to be weighted toward the Republican side, as are those of most of the others on Connecticut’s top-10 list, and Republicans have almost uniformly been against any tax increases for anyone. Yet Cohen and most of his fellow Connecticut billionaires are far from exclusively partisan in their contributions.In 2006 and 2007, for example, Cohen gave more than $55,000 to the Democratic Senatorial Campaign Committee, according to opensecrets.org. In 2007 and 2009, he also chipped in $58,900 to the National Republican Senatorial Committee.While Cohen has given money in recent years to individual candidates, there appear to be no major contributions to Connecticut candidates.Jonathan Pelto, former political director for the state Democratic Party, isn’t all that surprised, either by the bi-partisan nature of Cohen’s giving or the lack of local contributions.“What seems to happen more often than not is that the mainline wealthy are looking for a safe investment for their political dollars,” Pelto says. “A business person may be strategically trying to garner favor with selected groups of people … to ensure he has access and involvement with both sides of the aisle.”Pelto says that for many Wall Street barons in lower Fairfield County, “There’s a real sense their world revolves around New York City.” He says they often “perceive New York City Mayor Michael Bloomberg as more important to them than the governor of Connecticut.”Republican State Chairman Chris Healy says, “Sometimes people of great wealth give exclusively to Republicans, but that’s not always the case. … Some give out of business considerations, some are true believers.”And it’s always possible that you might just give a few bucks to a couple of neighbors who are running for something.The third-wealthiest person in Connecticut, according to the Forbes list, is Paul Tudor Jones II. He is also a hedge-fund operator and also owns a Greenwich mansion. Business Insider reported that Jones owns a 3,000-acre wildlife preserve in Maryland on the Chesapeake Bay that includes islands in the marsh allegedly shaped in the form of his initials, PTJ.Jones has given at least $2,400 to the Democratic U.S. Senate candidacy of Richard Blumenthal, a Greenwich resident running against another denizen of Greenwich, former World Wresting Federation CEO Linda McMahon. (McMahon and her husband Vince are worth in the neighborhood of $1 billion. Blumenthal’s salary as state attorney general isn’t in that league, but his wife’s family owns a vast real estate business that includes the Empire State Building.)At the same time, Jones has contributed at least $2,400 to Republican Tom Foley (another Greenwich millionaire) and his campaign for governor against Democrat Dannel Malloy.McMahon doesn’t appear to have gotten any serious money for her campaign from her wealthier neighbors. That could be because she’s pledged not to take contributions of more than $100 and because she’s ready to spend $50 million of her own on this race. (McMahon doesn’t like the idea of eliminating tax cuts for the rich, while Blumenthal supports only retaining federal tax reductions for middle-class taxpayers.) Cohen and Jones may spread their money to both parties, but Ray Dalio has an exclusively Republican record of big contributions. Dalio is another hedge-fund mogul, with a fortune estimated at about $4 billion.(Dalio is clearly a genius at making money, but not so good at predictions. Back in 2005, in an interview with Economy , Dalio dismissed the possibility of a recession. “I’m not worried about it,” he declared. Well, he seems to have been right in a personal sense. He’s still got that $4 billion.)Dalio gave tens of thousands of dollars to Republican John McCain’s 2008 presidential run, and more money to Republicans like Rudy Giuliani and Mitt Romney.On the other side of the political spectrum is Stephen Mandel, yet another hedge-fund Greenwich dude, whose personal wealth is estimated at $1.5 billion.Mandel is exceptional on this list of Connecticut’s wealthiest because he has repeatedly given significant amounts to Connecticut Democratic candidates, including Blumenthal, Jim Himes in the 4th Congressional District and Chris Murphy in the 5th District. Mandel even contributed $2,300 to U.S. Sen. Chris Dodd’s abortive presidential run in 2008.Others on Connecticut’s wealthiest list, like Thomas Peterffy (Wall Street broker, Greenwich resident) and Danbury’s Peter Buck (one of the founders of the Subway chain), have given money in the past to some Connecticut Republicans. Peterffy gave to former U.S. Reps. Chris Shays and Rob Simmons, while Buck put money into the unsuccessful congressional campaign of former state Sen. David Cappiello. (Cappiello is currently McMahon’s campaign manager.)Karen Pritzker, the only woman on this list, achieved her $1.5 billion fortune as an heiress in the family that owned Hyatt Hotels. Pritzker is also unusual in that she and her husband live in the relatively low-rent locale of Branford. (They did, however, pay $12.5 million in 2007 to buy the six-room penthouse on Manhattan’s Upper East Side where President John F. Kennedy used to entertain Marilyn Monroe.)Pritzker has contributed in the past to Democratic U.S. Rep. Rosa DeLauro, her Third District congresswoman. She has also given money to John McCain, Barack Obama and Rudy Giuliani.“She’s obviously covering her bets,” says State Republican Chairman Chris Healy.Healy believes his party has an obvious edge this year in trying to get some of those billionaire contributions. “I certainly hope so,” he says, “because they have the most to lose when the Democrats are in charge.”Pelto admits that getting rid of those Bush tax cuts isn’t a big selling point for Democrats seeking money from the über-rich.“When Democrats want to raise money from wealthy people, they tend not to talk about tax policy,” Pelto says. “Instead, you go after them on niche issues like the environment, abortion or war.”“Even when you’re going after Democratic millionaires,” he adds, “you recognize they’re not going to be supportive of tax policy that hurts them.”
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