Obama will likely have to replace many key figures on his cabinet in the coming year, as is customary for Presidents elected to serve a second term in Washington. Many have argued that Obama's second term will see a significant progressive shift. Others have expressed skepticism. While Washington incessantly focuses on the what the marginal tax rate will be for millionaires, the Patraeus scandal, and the "fiscal cliff", progressives should instead look at who Obama seeks to appoint to his cabinet in a second term with a keen eye. In almost every case, Obama looks poised to appoint someone who made their mark in the world as a corporate hack.
The four biggest vacancies likely to become open in the immediate aftermath of Obama's election relevant to progressive economic policies are Treasury, Attorney General, Commerce, and Chief of Staff (because the current Chief of Staff, Jack Lew, is a near lock for Treasury). Politico recently had a piece in which it floated the frontrunners for each position. Below I analyze their record as corporate hacks.
• TREASURY: JACK LEW
Jack Lew, Obama's current Chief of Staff, is considered a near lock to be headed to Treasury. During the middle of the financial crisis, Mr. Lew headed up Citi Group's "Alternative Investment" Group, which Lew ran into the ground to the tune of $20.1 Billion in risky investments:
Citi paid Lew $1.1 million for his year at Alternative Investments, according to an ethics disclosure report filed in January 2009. He was also eligible for an undisclosed bonus….His unit, though, lost as much as billions of dollars in 2008 as its bets turned sour. In the first quarter of 2008 alone the unit lost $509 million; the company stopped publicly disclosing the unit's individual numbers soon thereafter, but the part of the company that absorbed Alternative Investments lost $20.1 billion in 2008, according to the bank's filings with the Securities and Exchange Commission.• ATTORNEY GENERAL: DEVAL PATRICK
Citigroup, as you might recall, also received $45 billion in TARP money.
Deval Patrick is thought by many on here to be a solid progressive, and likely 2016 Presidential Candidate. However, Mr. Patrick comes with his own sordid history of profiting mightily off of corporate malfeasance:
In the top legal job at Texaco and Coca-Cola, Patrick defended the companies against accusations of environmental and human rights abuses in South America. On the board of the parent company of Ameriquest Mortgage Co., Patrick was "the point man," between the parent company's board of directors and an Ameriquest negotiating team to settle a $325 million predatory lending case in 49 states and clean up the company.The Boston Globe article further notes that it was only after his association with Ameriquest, and the $360,000 per year salary that he drew from them became a campaign issue, that he resigned in 2006--ridiculously declaring that hte company was on track to be a more responsible company.
• COMMERCE FRED HOCHBERG
Mr. Houchberg was born to the wealthy immigrant owners of Lillian Vernan Group Corp, a company he would get his start in. After leaving Lillian, Mr. Hochberg would start his own investment firm, specializing in real estate, stock market, and venture capital investments. He later would become a prominent Democratic fundraiser and would work at the Small Business Administration
While Mr. Hochberg made his mark as a relatively non-controversial businessman and fundraiser, his most controversial work has come in his most recent gig as head of the Ex-Im bank, the official credit export agency for the last several years. As ThinkProgress reported back in October of this year, under his leadership, Ex-Im has launched plans to totally destroy the environment in all corners of the globe for profit:
It’s not surprising to hear over-eager developers link the Ex-Im Bank to these projects because the institution has a long history of supporting fossil fuel projects. And that track record is getting worse. It got so bad that the Sierra Club wrote an open letter to President Fred Hochberg after we witnessed first hand the destruction these projects are wreaking on communities and livelihoods (check out our blog on the Sasan coal project in India).You may be touched to know that Hochberg considers his current job as CEO of Ex-Im Bank to be "the best job he's ever had."
But our pleas were callously ignored as President Hochberg okay-ed a massive expansion of coal finance in every corner of the globe. From Kusile in South Africa, to Sasan in India, to Xcoal in the U.S., to the recently proposed mines in Australia, it appears that Ex-Im Bank cares little for the environmental damage the institution is causing around the world — not to mention the reputation of this administration.
• CHIEF OF STAFF: TOM DONOLIN
Mr. Donolin is perhaps the most transparent corporate hack. His history includes being the Vice President of, and registered lobbyist for Fannie Mae. Before workign for the Obama transition team in 2008, Mr. Donolin was a partner in the law firm O'Melveny and Myers, a firm which represents clients such as Exxon Mobile.
Thus in all four of Obama's biggest vacancies, the current names being floated all have a history of corporate shilling. Look, I'm not saying that being a corporate shill necessarily discounts you for public service. This is especially true in Patrick's case because he has quasi-apologized for the actions of Ameriquest, and has run a campaign that was overtly progressive in between his corporate hacking and now.
But is it really too much to ask that Obama tap at least one solid progressive with no history of selling himself to the highest bidder to head one of these agencies? There are countless liberal economists with a fundamental understanding of Wall Street htat haven't made their living ruining this country. There are countless non-profit lawyers, and public servants without records of shilling for Texaco that could be our next AG.
Of course the bright side is that one could argue that any of the above names are improvements over the current cabinet which is also filled largely with corporate hacks. But what does it say about Obama's second term that these are the names being floated about?
Note: EPA is also likely to undergo a transition from the great Lisa Jackson to Robert Perciasepe (who as best as I can tell is a good fit). Additionally, Ken Salazar leaving the Dept. of Interior can only be an improvement.