Wall Street Rumbling Felt in Advance of November Elections

May 6, 2010 -- Legislation that would impose tougher regulations on Wall Street is moving through Congress slowly but is quickly becoming an issue in dozens of competitive congressional races across the country.

Months after lawmakers finished a bruising debate on President Obama's health care law, candidates from both parties are distancing themselves from Wall Street as the November general election nears.

The Democratic National Committee, for instance, is airing a television ad accusing the GOP of standing aside "as Wall Street ran wild."

The National Republican Senatorial Committee (NRSC) has called out Democrats who take campaign money from "the same Wall Street executives they criticize publicly."

"The collapse of the economy is tied directly to Wall Street," said Colleen Hanabusa, a Democrat running for the House of Representatives in Hawaii's upcoming special election. "This, to me, is one of the major causes of why we're in the situation that we're in." She vowed to hold banks accountable in an April television ad.

After boosting their numbers in the 2006 and 2008 elections, Democrats face a daunting political challenge in 2010. The non-partisan Rothenberg Political Report rates 78 Democratic seats as competitive this year, compared with 18 Republican seats. The president's party has lost seats in Congress in 10 of the past 12 midterm elections.

Nathan Gonzales, political editor with Rothenberg, says Democrats believe they have found a populist message that could benefit them. "You're not going to have candidates saying, 'I support less accountability from Wall Street,'" he said.

Democrats such as Senate Majority Leader Harry Reid of Nevada, himself facing a difficult re-election bid, went on the offense in April after Republicans voted against starting debate on the measure. Republicans ultimately let the bill advance.

Since then, Republican candidates have argued that the bill would sweep small banks up into regulations intended for Wall Street firms. At stake, they say, are thousands of Main Street banking jobs.