Nice Work If You Can Get It

The revolving door spins both ways in Washington. Some politicians collect their reward after they leave office, like former Representative Dick Gephardt, who is now raking in the big bucks as a corporate lobbyist. Others reverse the transaction and get their money upfront--before they become "public servants." Gene Sperling got his cash in advance.

This year Sperling is among the small circle of intimate staffers advising Treasury Secretary Tim Geithner on financial bailouts and other matters. Last year in private life, Sperling was paid $887,727 by Goldman Sachs as a consultant. That is peanuts compared to the big hitters at Goldman Sachs. But it's pretty pricey for a Washington policy wonk. Put it with the $158,000 Sperling earned making speeches to financial companies and some other lucrative chores and Gene looks like a million-dollar thinker.

Sperling was a White House acolyte of Robert Rubin during the Clinton years and among the many Clintonistas-in-waiting who have found a place in the Obama administration. Let us stipulate that he is earnest and intelligent, sincerely devoted to good government. But his money connections reflect the velvet sleaze that lubricates the Washington system. His résumé more or less assures that Citizen Sperling will not look at the outrageous fortunes of Wall Street players quite the same way lowercase citizens might. His experience and training allow him to appreciate the complexities of policy-making, while ordinary Americans may focus on the cruder questions of right and wrong.

The particulars of Sperling's good fortune were highlighted by Bloomberg News in an article titled, "Geithner Aides Reaped Millions Working for Banks, Hedge Funds." Kudos to reporter Robert Schmidt for assembling the facts. Sperling, we learn, actually earned $2.2 million in the thirteen months before he re-entered government. That includes $480,051 he was paid as a director of the Philadelphia Stock Exchange, plus $250,000 for his quarterly briefings to two hedge funds, plus the speaking gigs (including an appearance before the Stanford Group in Houston subsequently charged with running a Ponzi scheme). Meantime, his day job at the Council on Foreign Relations paid $116,653. A busy, busy wonk.

Nothing very noteworthy (or illegal) about this. As Schmidt explained, the circle of Geithner's close advisers includes other Clinton alumni with even better financial profiles. The high-end earnings got no attention because none of them were required to submit to Senate confirmation hearings. Lewis Alexander, former chief economist at Citigroup, was paid $2.4 million in 2008 and early 2009 before he came to Treasury to research financial markets and economic trends for the secretary. Geithner's chief of staff, Mark Patterson, was a lobbyist at Goldman Sachs and earned $637,492 (a pittance compared to the others). Matthew Kabaker is now a deputy assistant secretary working on disposing of toxic assets at troubled banks. In private life last year, he earned $5.8 million doing equity deals at the Blackstone Group (where Pete Peterson amassed his billions). Another top aide to Geithner, Lee Sachs, earned an estimated $3.4 million last year at the Mariner Investment Group, another New York hedge fund.

In fairness to Sperling, it should be pointed out that his consulting work for Goldman Sachs was solely devoted to charitable giving. He was the lead adviser, he explained, "on the creation, design and initial implementation of '10,000 Women,' their $100 million philanthropic effort to give business and leadership education to poor women around the world."

For his efforts, Sperling was paid $887,727. Charity does indeed begin at home.

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