The New York Times, covering the hiring of former Treasury Secretary Tim Geithner by private equity giant Warburg Pincus, writes this:
"Mr. Geithner initially seemed unlikely to join Wall Street."
Seemed unlikely to whom? Oh, yes, I recall this from January as Geithner announced he’d be leaving the Obama administration:
"A regulator of Wall Street but not a creature of it, he will probably be the least likely former Treasury secretary to land there."
That mystifying sentence came from the Times, as well, which also let Geithner spin, uncountered, his dismal record on housing. How naive can you get?
That story was part of a dispiriting series of parting kisses from the press to five of the principle figures in the Obama administration’s Wall Street-friendly response to the financial crisis: SEC enforcement chief Robert Khuzami, Justice Department criminal division head Lanny Breuer, SEC chief Mary Schapiro, National Economic Council chair Larry Summers, and Geithner.
Here’s where they’ve ended up:
— Khuzami took a $5 million a year job at corporate law firm Kirkland & Ellis after a six-month wait. Kirkland & Ellis represents such Wall Street firms as Morgan Stanley, UBS, American Express, and Bank of America, the latter of which got a wrist slap from Khuzami and the SEC for lying to investors—one so light that a federal judge raised a stink over it.
— Breuer, two months after leaving DOJ, went through the revolving door to his old firm Covington & Burling and makes $4 million a year as the firm’s vice chair. Covington represents a Who’s Who of the Wall Street firms Breuer failed to prosecute.
— Schapiro joined the board of General Electric, a company she wrist-slapped for accounting fraud in 2009, failing to prosecute any individuals despite finding that “GE, acting primarily through senior corporate accountants, engaged in knowing or reckless fraudulent activities resulting in numerous materially false and misleading statements or omissions.” Worse, Schapiro also joined Promontory Financial Group, a sort of shadow regulator that lets former SEC types cash in to help Wall Street “navigate” regulatory structures. Her pay is undisclosed but surely well into the seven digits.
— Larry Summers is back at DE Shaw, though no word if he’s still making $5 million a year for working one day a week. He’s also advising Citigroup, Nasdaq, Lending Club, and Silicon Valley biggie Andreesen Horowitz for untold pay.
— And now Tim Geithner becomes president of private-equity firm Warburg Pincus for an undisclosed pay package that will be in the many, many millions of dollars a year. Hey, at least, it’s not Goldman.
