How Tim Geithner Gets $200,000 a Pop to Chat With Big Banks
Cashing in on the speaker circuit the minute you leave office is a well-traveled road in Washington. In recent decades, the number of speaking bureaus has mushroomed, and the negotiations often start even before the office is vacated. As Puff Daddy once sang, “It’s All About the Benjamins.”
Some former “public servants” hop on the gravy train by taking up lobbying. But the speaker circuit is getting to be just as lucrative.
When they’re not pushing a discredited austerity agenda that harms the public and enriches the financial sector and the wealthy, Erskine Bowles (former White House chief of staff) and Alan Simpson (former senator from Wyoming) get their bread buttered on the speaker circuit to the tune of $40,000 a hit. (David Dayen notes that this is three times the amount that recipients of Social Security can expect in retirement per year.) Who is paying them? Behemoth banks like Bank of America and Manhattan investment groups, naturally.
Former president Bill Clinton blows right past Bowles and Simpson, raking in an estimated $106 million in speaking fees since leaving office, with individual payouts ranging from $28,000 to an eye-popping $750,000. Citigroup, Lehman, Merrill Lynch, Deutsche Bank, and Goldman have paid him up to $425,000 a pop just to talk the sweet language of bank-friendly capitalism.
Former Treasury Secretary Timothy Geithner has wasted not a moment to shove his snout in the financial sector speaking-engagement trough. Geithner’s bank-centric worldview dominated the White House in the aftermath of the financial crisis, doing untold damage to ordinary Americans. As renowned economist Simon Johnson has explained, “Geithner came to stand for providing large amounts of unconditional support for very big banks…” at the New York Federal Reserve and continued this pattern in Washington. He favored unqualified assistance to troubled banks rather than throwing out incompetent managers and directors or working to change harmful policies. The fact that we still have dangerous Too-Big-to-Fail banks on our hands is part of his dismal legacy.
The banking world is very grateful for Geithner’s championing of their interests over the public’s. Just six months after he left the Treasury in January, it has showered Geithner with cash. Deutsche Bank lavished him with $200,000 to speak at a conference in June. Private equity groups are also shoveling over piles of dough: Blackstone and Warburg Pincus paid Geithner $100,000 each for recent speaking engagements.
Here’s betting your local PTA can’t quite pony up those fees.
Bribery, corruption, and using one’s office for private financial gain are nothing new in politics, but we are reaching a fevered pitch that may end up outdoing the days of 19th century robber barons. Last year, the U.S. ranked #19 on Transparency International’s list of countries according to how clean the political system is perceived to be, just above Chile. Singapore, Australia, Canada, Germany, and Japan all ranked higher. The reason why the U.S. is slipping in the rankings? The tsnunami of money in politics, of course.
There’s an old saying, “He who pays the piper calls the tune.” Maybe that’s why Geithner’s theme song has always been, “I Left My Heart at Citigroup.”