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The ATM for Bush's America

New York conservatives bankrolled the Republican Senate. But now that their Wall Street agenda has been run off the road by the upcoming Supreme Court culture war, did they just throw their money away?


Factor and his wife, Elizabeth, who urged him to get involved with politics.  

Mallory Factor is sitting in the living room of his Upper East Side townhouse giddily reading aloud from a recent column by Robert Novak. “Representative Richard Baker of Louisiana, the conservative choice to be the next chairman of the House Financial Services committee, privately met about twenty leaders in the Wall Street financial community recently in New York City and impressed them with his command of the issues.” Factor, a 55-year-old banker and former public-relations specialist, looks up from his BlackBerry and says coyly, “I didn’t talk to Novak!”

Five years ago, Factor was a political nobody, a New York right-winger with zero clout. Today, he’s a leader of a tiny but powerful army of New York conservatives whose checkbooks sustain the national Republican majority. Manhattan is the most concentrated source of Republican funds in America, and New York conservatives have invested heavily in Bush and the national party—more than $100 million since 2000.

It is Factor’s ambition to be the steward of these funds, and that’s why he loves the Novak item—to insiders, it conveys proof of his status, even though his name wasn’t mentioned. People who matter would know that Factor organized the secret sit-down between the ambitious Washington pol Baker and the heavy hitters from Wall Street. He’s done it many times before. The way it works is simple. Congressman Baker wants to be chairman of a powerful committee. The suits from Wall Street want to vet Baker before they give him their blessing. Factor is the guy who brings the two worlds together, in this case over lunch at the Union League Club at 37th and Madison. In the process, another key Republican learns that Mallory Factor is now the guy to see to unlock the essential political commodities—money and media—that all GOP candidates come searching for in Manhattan.

Baker was a quick study. Back in Washington, he instructed a young aide to find out as much as he could about Factor. “I don’t know who he is,” the congressman said, “but I think he’s important.”

The core of Factor’s operation is a regular conservative gathering known as the Monday Meeting, which he runs with James Higgins, an investment manager. Factor is the money guy; Higgins is more oriented toward policy. Together, “they have created the Wall Street–Washington nexus,” says Steve Moore, a longtime activist on the right. “Now all these congressmen and senators want to go up to New York City because Mallory has become the gatekeeper to the large conservative fund-raising community.”

Until very recently, this was all going quite well. George W. Bush’s second term got off to a very promising start, as far as his New York constituency was concerned. They liked his courageous talk about Social Security privatization, as well as the strong focus on tax cuts and fiscal discipline. These are the articles of faith among Factor and his group, and they couldn’t have been more delighted that the president seemed to be reading from their script; they were getting what they’d paid for. But now the Social Security plan is stalled, if not totally dead, while Washington braces for a culture-war showdown over candidates for the Supreme Court. Factor is in an awkward spot. It had always been his intention to steer clear of issues that might pit his New York crowd of mostly fiscal conservatives against the social conservatives that dominate much of the rest of America. Now this strategy seems impractical and perhaps even a little embarrassing. Today’s Republican Party is held together by a tenuous agreement between the free marketeers of the party’s donor class and the Evangelical foot soldiers of the party’s voting base. Both sides claim credit for Bush’s reelection. But in the fight over the Supreme Court, the religious right will be ascendant, leaving fiscal conservatives with little to show for their investment. That raises a question: Might it possibly be that these rich, sophisticated New Yorkers have been taken for a ride?

The Monday Meeting is now large enough to be respectable but small enough to maintain its cachet. Held in the ballroom at the Grand Hyatt, it usually attracts between 175 and 225 guests, all screened by Factor and Higgins, who say that there are some 60 more names on a waiting list. Originally, the meeting was modeled on the one that the conservative activist Grover Norquist has held every week in Washington for a decade. About one third of the attendees are donors, people like Oppenheimer Capital founder Charles H. Brunie, a close pal of Milton Friedman’s and Alan Greenspan’s; James J. Burke Jr., the co-founder of the investment firm Stonington Partners; and Georgette Mosbacher, the wealthy GOP Manhattan hostess and CEO of the beauty company Borghese. Another third are leaders of conservative organizations and think tanks, like Mark Mix, the president of the anti-labor National Right to Work Committee, and scholars from the Manhattan Institute. The final third are members of the media, including an assortment of editorial-page writers from the Wall Street Journal, the Post, and the Sun. “We carefully try to control the mix,” says Factor.

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