All Roads Lead to Goldman Sachs

[bobbyw24]

by Rob Kirby | February 16, 2010


Once upon a time, Goldman Sachs shunned publicity. During the period from 1930 to 1969, Sydney Weinberg ran Goldman Sachs where he developed a staunch corporate cultural aversion to publicity. During the 1970s, a tandem of John Weinberg and John Whitehead assumed the reigns of leadership at Goldman Sachs. Whitehead left the company in 1984 to enter public life. John Weinberg carried on in the same vein as his father Sydney – shunning publicity – to the point where he hired a man to keep his name and his firm's out of the press. He kept him off the full-time payroll (though he sat full-time at a desk in head office) so that if, improbably, a comment did slip out, it could be honestly dismissed as not coming from a Goldman Sachs employee. John Weinberg served as sole senior partner and chairman until 1990. His mantra was to put the client’s interests first and he wouldn’t allow Goldman to be involved hostile takeovers.

The culture at Goldman Sachs dramatically changed in 1990 when operational control of the firm was ceded to Robert Rubin and Stephen Friedman. This tandem became the Co-Senior Partners in 1990 and re focused the firm on globalization and strengthening the Merger & Acquisition and Trading business lines.

Since this cultural shift in 1990, Goldman, its employees and alumni have been attracting HEAPS of public attention – much of it unflattering – owing to allegations and / or public perceptions of frontrunning, government patronage / favoritism and conflict of interests with clients. As the following biographical sketches attest – Goldman Sachs has become not only a world renowned financial juggernaught but also highly influential in areas that transcend finance.

High Profile Goldman Associates – Notable or Notorious?

John Whitehead – Had a 38 year career at Goldman Sachs - he retired in 1984 as Co-Chairman and Co-Senior Partner. He served as United States Deputy Secretary of State in Ronald Reagan's administration from 1985 to 1989 under George Shultz, and was awarded the Presidential Citizens Medal by President Reagan. In 1996, he was the campaign chairman for Michael Benjamin who ran for a seat in New York's 8th congressional district. He is former Chairman of the Board of the Federal Reserve Bank of New York, the United Nations Association, and a former Chairman of The Andrew W. Mellon Foundation and the Harvard Board of Overseers. He is a former director of the New York Stock Exchange and Chairman Emeritus of The Brookings Institution.
Robert Rubin - served as the 70th United States Secretary of the Treasury during both the first and second Clinton administrations. Before his government service, he spent 26 years at Goldman Sachs serving as a member of the Board, and Co-Chairman from 1990-1992.

Henry Paulson - as the 74th United States Treasury Secretary. He previously served as the Chairman and Chief Executive Officer of Goldman Sachs.

John Thain -


http://www.financialsense.com/fsu/editorials/kirby/2010/0216.html

 

[boethius27]

Matt Taibbi wrote a great piece on Goldman last year too. The amount of links they have to high places in the gov't is just astounding. I'd really love to see a graphic, like a spider map or something of who is who relating goldman to gov't.

nutty.

 

[Chester Copperpot]

these guys go into public office also because if forced to liquidate any private assets because of the new public job.. any income is considered non taxable for income tax purposes... Henry Paulson had something like a $500 million profit when he became treasury secretary.. all tax free.....

 

[Brian4Liberty]

A truly Bipartisan effort...

 

[Brian4Liberty]

these guys go into public office also because if forced to liquidate any private assets because of the new public job.. any income is considered non taxable for income tax purposes... Henry Paulson had something like a $500 million profit when he became treasury secretary.. all tax free.....

Yeah, we shouldn't forget that tax-loophole. Let's tax the rich! Right...

 

[bobbyw24]

A truly Bipartisan effort...

thats right

 

[bobbyw24]

Goldman Sachs Gave More Money To Federal Politicians Than Any Other Financial Firm

THE CASE AGAINST GOLDMAN SACHS

Goldman Sachs case likely to increase calls for Wall Street reform

The SEC's civil charges against the investment bank also are expected to further weaken the firm's influence in Washington.

By Jim Puzzanghera and Nathaniel Popper

April 17, 2010

Reporting from Washington and New York


Goldman Sachs Group Inc. was once a darling in Washington, handing out millions of dollars in campaign contributions and supplying so many executives for key federal positions -- including two recent Treasury secretaries -- that some people called the firm "Government Sachs."

But the Securities and Exchange Commission's allegation of fraud in Goldman's marketing of mortgage-backed securities is exacerbating the Wall Street firm's already substantial PR woes in the wake of the financial crisis and its receipt of $10 billion in bailout funds.

The case also is likely to not only further diminish the firm's already weakened influence in the capital but also fuel efforts by the Obama administration and congressional Democrats to pass the most sweeping overhaul of financial regulations since the Great Depression.

"When Goldman Sachs and their friends come into Congress and say, 'Leave us alone. You don't need to regulate us,' I think that argument becomes weaker and weaker," said Sen. Bernard Sanders (I-Vt.), a strong supporter of tougher financial regulation.

Lawmakers from both parties scrambled Friday to use the case against Goldman to their advantage.

Democrats said the allegations showed the need for their regulatory proposals, particularly for a provision opposed by Goldman that would increase transparency in the trading of derivatives, the complex securities at the center of the SEC charges.

"We don't need to know the outcome of this case to know that the opaque nature of unregulated asset-backed securities fueled the financial crisis," Senate Banking Committee Chairman Christopher J. Dodd (D-Conn.) said. "We must pass Wall Street reform to bring practices like these into the light of day and protect our economy from another devastating blow."

House Minority Leader John A. Boehner (R-Ohio), meanwhile, depicted Goldman as one of Obama's "Wall Street allies" and "a key supporter" of a part of the legislation that would create an industry-paid fund to cover the cost of future seizures of large financial firms. Boehner and other Republicans said those seizures would turn into bailouts.

It already had been a precipitous fall for the Wall Street firm, a power player on Wall Street and in Washington for years.

Since 1989, the company's employees have contributed $31.6 million to federal political candidates, more than any financial firm, the nonpartisan Center for Responsive Politics said. About two-thirds of that money has gone to Democrats, including nearly $1 million to Obama during his 2008 presidential campaign, the company's top recipient during that election cycle.

Democrats and Republicans have tapped former Goldman executives for key financial positions. Robert Rubin, a former Goldman co-chairman, served as Treasury secretary under President Clinton. Former Goldman Chief Executive Henry M. Paulson held the Treasury post under President George W. Bush from 2006 to 2009.

But when the financial crisis hit, Goldman's reputation began sinking.

"In Washington and in the country as a whole, all of the industry's leaders have been tarred by this crisis and Goldman, because it's been so successful in many ways, has suffered worse than the others in terms of their reputation," said former investment banker Douglas Elliott, an economics fellow at the Brookings Institution.

The company also has been hammered for recovering all $14 billion it was owed from American International Group Inc. after the insurance giant was bailed out. Critics, calling the payment a "backdoor bailout," claimed that Goldman's connections with Paulson were behind that outcome.

Treasury Secretary Timothy F. Geithner was pummeled during a recent congressional hearing for hiring a chief of staff who had worked for the firm. And when top Wall Street executives went before the bipartisan commission investigating the financial crisis in January, the panel's chairman focused his fire on Goldman Sachs Chief Executive Lloyd Blankfein, comparing him to a shady car salesman.

http://www.latimes.com/business/la-fi-goldman-politics17-2010apr17,0,4264607.story