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What the Former Obama Lawyer's Defection for Goldman Sachs Says About 'Transparency' in Washington

Why is the top White House lawyer taking a job at Goldman Sachs?
 
 
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Barack Obama's Washington was supposed to be a place where transparency reigned and influence-peddling dwindled into irrelevance. But the latest high-profile hire at Goldman Sachs makes clear that, even in Obama's Washington, money and power still hold sway.

The investment bank, under fire from the Securities and Exchange Commission for allegedly defrauding its investors, has hired former White House counsel Greg Craig to aide its cause. Craig's new gig confirms what many government ethics observers predicted: despite the president's initial efforts to reform Washington, ex-administration officials will find ways to market themselves to rich clients. If presidential appointees on their way out of office find new and creative ways to serve powerful interests, Obama's efforts to clean up Washington culture could ultimately leave the place even murkier and more secretive.  


As his first presidential act, Obama issued an executive order detailing how Washington would behave during his time in office. Lobbyists would not work for the administration, and administration officials would not leave the government to become lobbyists. It was an open attack on the revolving door between the top levels of industry and government, an effort to insulate taxpayers from corporate abuses.

But it takes more than a flourish of a pen at the beginning of an administration to thwart the exchange of money and influence, a practice deeply ingrained in the American political system. The problem is not unique to the federal government. Governors who recently swept into office promising a new era of sunshine and accountability include Louisiana's Bobby Jindal and Florida's Charlie Crist. None of those states have been transformed into paragons of ethical behavior. Neither has Washington.


Craig provides an important test case for the path Obama appointees could take after leaving office. An early Obama supporter, Craig was mentioned as a candidate for Secretary of State before he landed in the counsel's office. During the first year of Obama's presidency, Craig worked to close the prison at GuantanamoBay, one of the Bush administration's most shadowy endeavors. In November 2009, however, after shutting down Guantanamo proved problematic, Craig became one of the first high-profile Obama appointees to announce his resignation. In 2010 he rejoined the private sector as a lawyer for Skadden Arps, a high-powered law firm with ties to Wall Street.


Now, instead of advising the president, Craig will advise a company that helped create another one of the dark clouds hanging over the country. Technically, Craig is not violating President Obama's ethics order. He is barred for two years from appearing before or lobbying the White House and its executive offices. In Craig’s case, Obama's order doesn't cover work with the SEC, which as an independent agency was not part of the former counsel’s official responsibilities. So far the White House has not had much to say about Craig’s new client; the press office did not respond to requests for comment from AlterNet.

When it comes to exercising influence, Goldman knows what it's doing. The Center for Responsive Politics, which monitors money in politics, last week called the company "one of the largest wielders of political clout." In the last election cycle, the firm's financial footprint totaled about $6 million, according to CRP, which analyzed contributions from "people and political action committees associated with Goldman Sachs." CRP also found that Goldman’s employees contributed more to Barack Obama’s war chest than did any other group in the private sector.


So Goldman probably isn't terribly worried about the fact that Craig can't parlay with the White House for a while: the company has plenty of other lobbyists listing it as a client— 49 at last count—including former majority leader Dick Gephardt and Kenneth Duberstein, who served as chief of staff to Ronald Reagan.