Media Blog

Hilary Rosen Calls Jack Lew Not a ‘Successful Wall Streeter’

Hilary Rosen — last heard from when she said Ann Romney never worked a day in her life — has been hired by the Washington Post to write for their “Insiders” column. The Post hails her “independent mind.” Here’s her piece from today on Jack Lew:

We often forget that the government we have for the people by the people is actually “of the people.” And when one of those people is Jack Lew, I know that he has his priorities right — putting poor and middle-class Americans first.

In a pretty unprecedented turn, the next Treasury secretary will not be a captain of industry or a longtime successful Wall Streeter. No, the next Treasury secretary is a man who has worked almost his entire professional career of 35 years, save for a two-year stint, in public service of one kind or another. A graduate of Harvard College, like much of the country’s elite, Lew perfected his values at a different Boston institution, the office of former House speaker Tip O’Neill, where I first met him.

That’s an “independent” voice? More like head of Obama’s cheerleaders.

And maybe Lew is not a “longtime successful Wall Streeter,” but he certainly had short-term success while working at Citi from 2006 to 2008. You know, the time that the bank was doing all that stuff that President Obama has said ruined the economy he inherited?

John Cassidy wrote a much more honest assessment of Lew in the New Yorker back in January. An excerpt:

The knocks on Lew will largely come from the left. . .

[He’s serious about those attacks from the Left, by the way]

. . .Do we need yet another Rubinite, with close ties to Wall Street, as Treasury Secretary? During the Bush Administration, Lew worked for Citigroup, where Robert Rubin was then chairman. He served as managing director of Citi Global Wealth Management and chief operating officer of another unit, Alternative Investments, which included a proprietary trading desk that reportedly made money betting against the housing market. Subsequently, the federal government bailed out Citigroup, which is only now recovering from its near collapse in 2008-09.

Lew’s time at Citi is sure to come up in his confirmation hearings, where he’ll also face more questions about his views on financial regulation. As an informative piece about him at the Huffington Post points out, some of his answers during his 2010 confirmation hearing, when he was up for head of O.M.B., weren’t exactly revealing. Asked whether deregulation had been responsible for the financial crisis, he replied: “I don’t believe that deregulation was the proximate cause…. I would defer to others who are more expert about the industry to try and parse it better than that.”

Some critics will view Lew’s appointment as another sop to the banks on Obama’s part. It’s certainly not very imaginative, but Lew deserves a chance to prove himself. An alternative reading is that given his history with Citi, and the need to assure the public he isn’t a Wall Street patsy, he will be driven to adopt a tougher approach to financial regulation than his predecessor, Timothy Geithner.

Odd. “Indpendent” Rosen sees Lew much differently. 

Rosen continues her piece with a defense of Lew’s Cayman Island connections:

The Republicans’ faux outrage that Lew invested some of his money — and he doesn’t seem to have very much of it — in a Cayman Islands fund is amusing. It is supposed to be a huge “gotcha” because President Obama accused Mitt Romney of sheltering much of his fortune overseas.  Unfortunately, this argument backfires on Ed Rogers and the GOP, because Lew has actually advocated policies against his own interest, unlike the GOP.  

Oh, please. The point isn’t Lew’s investment in one Cayman fund, it’s what he did while he was at Citigroup. CNBC reports:

How involved was Lew with Citi’s Cayman Islands ventures? Hard to pinpoint.

A 2007 filing with the Securities and Exchange Commission lists 90 Citigroup subsidiaries based in the Cayman Islands. The next year’s filing lists 114 Cayman Islands subsidiaries.

It is not clear from the filing how many of these Cayman Islands subsidiaries were part of the Alternative Investments unit, a financial advisory unit catering to high-net-worth individual investors and institutional investors with financial products that included venture capital funds, hedge funds and private equity funds.

A former employee of the unit, who spoke on the condition of anonymity, said that it is likely a “substantial amount” of these subsidiaries were run by the unit.

Lew worked at Citigroup from 2006 to 2008. In January 2008, he became the chief operating officer of the Citi Alternative Investments unit. Before joining that group, he was chief operating officer of Citi Global Wealth Management. Lew was also a member of the Citi Management Committee — a board of senior managers from many businesses within the bank.

Rosen ends her piece with, “Jack Lew is pretty much the most upstanding guy in government.”

We shall see.

 

 

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