Accusations of her being in financial industry’s pocket keep resurfacing in the presidential debates but is the Vermont senator focusing on the wrong culprit?

As the final days of 2015 slip by in a fundraising blitzkrieg for the two Democratic candidates who are battling it out for the nomination to be their party’s standard bearer in the upcoming presidential election, increasingly, the rhetoric seems to revolve around two words.

Wall Street.

Specifically, as Hillary Clinton seems to widen her lead over her chief rival, Vermont senator Bernie Sanders, the latter is striking back at what many pundits view as Clinton’s achilles heel among Democrats: the perception that she has had an overly cozy relationship with Wall Street for many, many years.

Over and over again, the issue has surfaced in the Democratic party presidential debates. In November, Sanders flat out accused Clinton of being in Wall Street’s pocket, adding that the banks “expect to get something” in exchange for their “millions of dollars of campaign contributions”. It’s common sense, he pointed out for the benefit of viewers. “Everybody knows that.”

Clinton, unsurprisingly, was ready for the attack. Most of her donors – numerically speaking – were small, she argued. “Hundreds of thousands” of them, and a majority were women. (Though I’m not sure how gender makes a big difference here, to be honest.)

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It was Sanders’s attack, and not Clinton’s riposte, that earned the applause. And that’s not surprising, in an election season still overshadowed (for the Democrats) by failures, both actual and perceived, to rein in and corral Wall Street. Voters of all political hues are angry and feel economically disadvantaged and cut off from any input into the political process. On the Republican side, that wave of populist outrage has fueled Donald Trump’s campaign; for the Democrats, it has galvanized Bernie Sanders’s campaign, which revolves largely around domestic economic issues, such as a “rigged” economic system that he argues is controlled by the richest 1% of Americans. Then there are the banks: “The business model of Wall Street is fraud,” Sanders memorably declared in November.

Setting aside the idea that Wall Street, collectively, is as capable of conspiring effectively as Sanders believes (if it did, I doubt that we would have experienced the 2008 crisis, or that as many institutions or individuals within them would have been caught off guard, or nabbed by regulators for doing stuff that they shouldn’t), I’m not convinced that Clinton is the patsy that Sanders would like us to imagine her as being.

Admittedly, it’s sometimes hard to draw a line between onetime Senator Clinton of New York – whose constituency included Wall Street – and Wall Street. Speeches to firms such as Deutsche Bank, UBS and (gasp) Goldman Sachs, the vampire squid of Wall Street, accounted for as much as a third of her total speaking income in 2013, or a hefty $3.15m.

Still, that’s just speaking income. If Sanders really wanted to find a Democrat with ultra-close ties to Wall Street, he could look at Chuck Schumer, Clinton’s former senatorial colleague, who thanks to his own support for Wall Street (and in spite of having voted in favor of the Dodd-Frank reform measures), had managed to accumulate a campaign war chest of $24m by midsummer 2010 in his bid for a third term. He won his seat handily, and continues to advocate for Wall Street. Clinton’s links look downright fragile in comparison.

It’s true that Clinton’s reform plan for Wall Street isn’t as dramatic as that proposed by Sanders. She wants to keep the Dodd-Frank Act in place and keep funding for the Consumer Financial Protection Bureau at robust enough levels to ensure the organization is effective in fulfilling its mandate. Massachusetts senator Elizabeth Warren, who oversaw the creation of the CFPB and who has been an outspoken critic of Wall Street, hailed this and some other aspects of Clinton’s plans, even though the two differ on the extent to which Wall Street should be regulated.

In the eyes of Sanders and his followers, however, Clinton remains in Wall Street’s pocket because she fails to propose what to them appears to be an absolute requirement: reinstating a policy first put into place in the depression that separated investment banking (the risky part of Wall Street) from the banks that serve you and me, taking our deposits and issuing our loans. Enshrined in the Glass-Steagall Act, that system remained intact until the end of the 20th century when, under attack from bankers (notably Sandy Weill of Citigroup), it was repealed by the passage of the Gramm-Leach-Bliley Act.

Only nine years later came the financial crisis, and in the eyes of many analysts and critics, there’s a causal link between the two events. I’m not convinced. Banks that are too big to fail, and banks that manage risk poorly and take too much risk, aren’t always the same.

Clearly, aggressive risk taking by banks was a major cause of the financial crisis. But of the institutions that were most directly responsible for triggering the 2008 crisis – Bear Stearns, Washington Mutual, Lehman Brothers, AIG, Fannie Mae – none was a big bank created by the repeal of Glass-Steagall. They were traditional investment banks, savings and loan institutions, insurance companies and a government-backed housing finance entity.

Ultimately, a few Glass-Steagall-created big banks did end up teetering on the brink, and were saved thanks to bailouts – notably Citigroup and Bank of America – while others took bailout funds at the insistence of the Federal Reserve and the Treasury Department during the scary days in late autumn 2008, such as JP Morgan Chase. And certainly, the last thing we need is for a “too big to fail” bank to be managed as was Lehman Brothers, or Bear Stearns. Or, in an earlier era, Long Term Capital Management, a hedge fund whose collapse nearly torpedoed the financial system back in 1998.

But it’s far from certain that simply restoring Glass-Steagall would be a panacea, or that failing to do so suggests that Clinton is in the bankers’ pockets. Indeed, Clinton’s plan has the virtue of stretching beyond the banks, and recognizing that real financial power on Wall Street often resides elsewhere: in the hands of hedge funds, private equity funds, offshore institutions, high-speed traders, and other kinds of trading platforms. The banks may be big and powerful, but they are the employees of these shadow institutions and individuals – folks like hedge fund manager John Paulson, whose firm made $15bn and who personally made $4bn (or $10m a day) shorting mortgage securities during the financial crisis. Clinton’s suggestions for regulating Wall Street call for more oversight of this “shadow” world.

Of course, substantive and lasting change in the way that Wall Street does business takes place can only happen from within. Only if the CEOs of the financial institutions – the hedge funds, the investment banks, the asset management firms – collectively establish the right set of incentives and punishments, and don’t turn a blind eye to those who transgress (unless and until they are caught by the FBI), will a new approach to risk taking take root and Wall Street bankers cease thinking of their hapless unsophisticated clients as “muppets”. It just may be that the kind of calm, cool and tough Clinton who sat through endless hours of grilling from hostile congressional Republicans over the events surrounding the 2012 attack on the US consulate in Benghazi, can persuade someone like Jamie Dimon or Lloyd Blankfein to revisit their business models.

This all hinges on Clinton’s own willingness to act. She is focusing on the right topics, and not allowing herself to be distracted by the academic debate of whether reinstating a long-dead policy is the right thing to do. But trying to really reform Wall Street would require a lot of political courage and resources; there are no hints as to whether this is an area in which Clinton might choose to deploy any political capital. And for that matter, Sanders might just prove to be right. She just might have spent so much time sitting in corporate boardrooms, seeing the world through the eyes of CEOs and Wall Street bankers, that even without being aware of it, she simply can’t do anything but act in their interest.

If the polls are right, we may yet find out.