Meet the New Boss?

Mark Patterson, until last year a lobbyist for Goldman Sachs, has just been named Treasury Secretary Timothy Geithner’s Chief of Staff.

It pains me to point out that this is now the second time in a week that President Obama has violated his own ethics rule against hiring lobbyists, and indeed has placed them in the highest levels of his administration. (The first was William Lynn, the former Raytheon lobbyist who was named to the #2 position in the Defense Department.)

The appointment came with the usual rationale about how knowledgeable Patterson is and how much he’s served his country. And in an attempt to ward off questions about hiring a Wall St. lobbyist to help run the Treasury, it was simultaneously announced that Patterson will be prohibited for the next two years from participating in any decisions related to Goldman Sachs and the specific issues on which he lobbied.


Given that Goldman Sachs is one of the giants of Wall St., such a promise is patently absurd. As journalist Ed Brayton points out, “There is virtually nothing the treasury could do outside of ordering lunch that would not have an impact on [Goldman Sachs’] profits.”

Aside from the nettlesome problem of our new president violating his own ethics pledge twice in his first ten days, there is the serious question of exactly what kind of expertise Mr. Patterson will bring to the Treasury Department, since he was lobbying for exactly the deregulation and bizarre financial instruments that led to our current crisis.

Of course, this puts Mr. Patterson in good company. Because his boss, Treasury Secretary Geithner, is also intimately associated with Lawrence Summers and Robert Rubin, former Treasury Secretaries (under Clinton) who both pushed financial deregulation. Rubin (who was named by Ethisphere magazine as one of the “10 most unethical people in business”) was a 26 year vet at Goldman Sachs before Treasury, and after it went back to Goldman Sachs and also Citi-group. Summers is now the head of the White National Economic Council.

And while we have all heard about Mr. Geithner’s small problem paying taxes, the much bigger issue is that the New York Fed, which he ran before being tapped by Obama, hosted the meetings to structure the infamous Wall St. bailout of last fall. (Remember – the one that already sucked up $350 billion, and no one can say exactly where the money went?) As is perhaps needless to say, Goldman Sachs and its principles made out very well during deregulation, and now they’re profiting handsomely from the bailout, thank you very much.

Financial experts have taken a big hit in this financial meltdown – even former Fed Chairman Alan Greenspan was forced to admit to Congress last fall that the crisis caused him to “discover a flaw in the model that…” (in his mind, anyway) “defines how the world works.” But it shouldn’t take an expert to realize that hiring people who caused the crisis may not be the best way to solve it.

Is it too much to hope they’ve learned something from their mistakes?

(With a tip of the hat to Laura Flanders for her story on Patterson’s appointment.)


One Response to “Meet the New Boss?”

  1. Richard Maletz Says:

    With this country being so affluent and more integrated, we should have the best organized and healthiest in the solar system.

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