One political strategist quoted by Bloomberg calls it “the biggest scandal nobody in Washington or Wall Street wants to talk about.”
Republican Representative Scott Garrett of New Jersey, chairman of the powerful Subcommittee on Capital Markets and Government Sponsored Enterprises, refuses to support gay candidates. Since Garrett is partially responsible for distributing funds to candidates, this is particularly problematic for the party.
"Much of the money Garrett collects from Wall Street is supposed to be passed along in the form of party dues to the GOP’s campaign arm, where it’s used to help other candidates get elected," according to Bloomberg.
"At a private caucus meeting, he got into a heated dispute with his colleagues by declaring that he’d withhold hundreds of thousands of dollars in National Republican Congressional Committee dues to protest the party’s support for gay candidates. His outburst immediately caused a rift in the caucus. “I was shocked,” says Richard Tisei, a Massachusetts businessman who was one of the candidates Garrett objected to. “The first time I ran, I was nervous my sexuality would be a problem. But everyone was just great. John Boehner, Paul Ryan—they went out of their way to let me know it wasn’t. Eric Cantor pulled me aside and said, ‘You know, I’m the only Jew in the caucus, so I understand better than anyone how important it is to have you down here to broaden and diversify our ranks.’ ”
Further, his antigay views are not limited to political candidates: he even co-founded a private high school, Veritas Christian Academy, in Sussex County, which explicitly forbids “homosexual activity,” Bloomberg reports. The “Code of Conduct” on the Veritas website warns students that any violation will draw an automatic suspension and possible expulsion.
But according to Bloomberg, Garrett's political position and relationship with wealthily Wall Street Republican backers is crucial, so many lawmakers and financial institutions who may disagree with his antigay views have been willing to overlook them.
But now that Garrett is up for re-election in November, the question is: will voters be able to overlook his views? Democratic challenger Josh Gottheimer, a young Microsoft executive and veteran of Bill Clinton’s White House, is considered a serious threat, and according to Bloomberg, the timing of Garrett's antigay outburst "couldn't be worse."
"Democrats have already recruited a strong challenger for his congressional district in what is one of the most expensive media markets in the country (a factor that until now worked in the chairman’s favor). 'Garrett’s biggest political asset has long been the financial windfall he received primarily due to his perch on the Financial Services Committee,' says David Wasserman, the House editor for the nonpartisan Cook Political Report. 'If that goes away, it could be a whole new ballgame.'"
The financial industry ranks as one of the biggest donors to the Republican Party, but it also has an excellent track record when it comes to supporting gay employees. Bank of America was among many big name employers to earn a perfect score from the Human Rights Campaign in its annual Corporate Equality Index.
"Garrett’s reelection race presents banks and investors with a fascinating—and excruciating—moral dilemma: Do they follow their financial interests and continue supporting a chairman whose antiregulatory views largely jibe with their own? Or do they honor their professed commitment to LGBT equality by cutting off that support and potentially angering a powerful industry overseer?"
Though Garrett is vital to relations with Wall Street, he may also be seen as a liability as the GOP seeks to broaden its appeal. "Garrett’s comments, which quickly became public, reaffirmed the impression of Republicans as stridently intolerant," Bloomberg reported.
Steve Elmendorf, a financial services lobbyist in Washington and former Democratic House staff member thinks all that's needed to unseat Garrett is exposure of his views.
“Corporate America views LGBT issues as a basic civil-rights issue,” lobbyist Elmendorf says. “If an elected official said something racist about Hispanics or African Americans, it would be very hard for a corporation to support that official.” Garrett’s continuing favor on Wall Street shows that some firms don’t yet accept this parallel. It will take more controversies for that to change. “The thing the LGBT community needs to do,” Elmendorf says, “is put a bigger spotlight on the people and the firms who help lawmakers like Garrett, and let them know, if you want to be known as pro-LGBT, you can’t support someone like this.”
Here's the spotlight, and it's on.