The F Word: Goldman Sachs is back. They never Left.
Goldman Sachs is making a comeback — maybe not on the stock market — but in Washington DC.
Timothy Geithner, recently confirmed by the Senate as Treasury Secretary, has reportedly tapped a former Goldman Sachs lobbyist to be his chief of staff. Mark Patterson worked as a registered lobbyist at the investment firm from 2005 to April of last year.
It’s no wonder that Geithner, who’s succeeding Henry Paulson at Treasury, would appoint a Goldman insider to serve as his right hand man. Paulson was once CEO at Goldman Sachs himself. At Treasury he was preceded in the Clinton administration by Robert Rubin, yet another Goldman CEO.
Goldman is about as connected a firm as they come. The firm paid former President Bill Clinton almost $950,000 for speeches he delivered between 2004 and 2007. The company’s Political Action Committee was the fourth largest donor to Senator Clinton’s campaign, right after Citigroup. According to the Center for Responsive Politics, the Goldman PAC — to which Geithner’s puported Chief of Staff contributed – invested well over half a million in contributions to Congressional candidates in the 2008 cycle, mostly Democrats, and mostly incumbents. Goldman Sachs employees alone contributed more than $5 million. Candidate Obama received over $1,000,000 himself from Goldman in the 2007-2008 fundraising cycle.
It puts a bit of a pall on President Obama’s pledge to limit the influence of lobbyists in his administration.
Obama has said that if lobbyists work for him they won’t work on areas on which they’ve lobbied. It’s hard to imagine how that will work out for Patterson. As ABC News notes:
“…even if he recuses himself from matters related to Goldman, there is little outside oversight. The position of chief of staff is appointed by the secretary of treasury and does not require Senate approval…” As most of the treasury staff’s business goes on behind closed doors, there will be little for outsiders to see.
What we do know is that Goldman Sachs executives had a seat at the table when the regulations on finance were loosened under Clinton and they’ve had a seat at the table since the whole bailout business began. The firm was an early and large recipient of TARP funding. Goldman received $10 billion almost immediately. It’s hard to think of a single solitary reason why anything or anyone would be likely to stop the flow.
And for continuity’s sake, the fellow selected to replace Geithner at the New York Fed, William C. Dudley, was, formerly chief economist at–hold your breath–Goldman Sachs.