For more than six years, Eric Holder was the chief law enforcement officer in the United States. Appointed by President Obama as attorney general in 2009, he served until this spring, when he returned to the law firm of Covington & Burling.
As attorney general, Holder was responsible for prosecuting the bankers responsible for the financial crisis. To say he was not vigorous in pursing this task is putting it mildly: Not a single executive was ever convicted for crimes related to the meltdown.
Among its clientele, Covington has counted such Wall Street mainstays as Wells Fargo, Bank of America, and JP Morgan Chase. Holder now stands to make millions defending them. The firm went so far as to keep a corner office open for Holder for years on end, waiting out his time in the Justice Department.
This, my friends, is known as the “revolving door.”
As the Obama era winds to a close, we can witness those who came to Washington on a tide of “hope” and “change” wash back out on a current of cash, taking up corporate America’s offers to join them as lobbyists, board members, strategists, and experts in government relations.
Part of the revolving door problem occurs when political appointees come straight from the industries that they are supposed to oversee as public servants. George W. Bush’s Secretary of the Treasury during the 2008 financial crisis, for example, was Hank Paulson, former CEO of Goldman Sachs.
Spoiler alert: Goldman was one of the banks that received billions of dollars in government bailout funds.
Of course, such suspect appointments are not unique to Republicans. Senator Elizabeth Warren, a resolute Wall Street critic, pointed out late last year that “three of the last four Treasury secretaries under Democratic presidents held high-paying jobs at Citigroup either before or after serving at Treasury.” Other important Obama administration officials, including current U.S. Trade Representative Michael Froman, made millions at the same bank.
But the revolving door does not stop there. The other half of the problem is that, when political officials depart, those who have kept cozy relations with business are handed choice private sector jobs by companies seeking to monetize their Rolodexes.
“Seven years into the Obama administration, this is the time when people are… cashing in,” one watchdog told The Guardian, noting that Obama’s efforts to address the problem were “about as solid as Swiss cheese”.
Former Budget Chief Peter Orszag now rakes in $4 million per year at Citigroup. Ex-White House press secretary Robert Gibbs, meanwhile, is the new global head of communications for McDonald’s. Over the past year Gibbs led a national public relations drive on behalf of charter school advocates aimed at rolling back the power of teachers’ unions.
Anti-union advocacy has become something of a trend. Having departed the White House in 2013, famed presidential advisor David Plouffe serves as a top strategist for the ride-sharing company Uber, which is at war with the National Taxi Workers Alliance—as well as with taxi unions in countries including France and Mexico.
Plouffe was recruited to Uber by former Obama campaign manager Jim Messina, whom BloombergBusiness has described as “Silicon Valley’s go-to government fixer.”
Messina is a busy man. He also runs a big-money political action committee supporting Hillary Clinton, and he served as a consultant to the British Conservative Party in the 2015 elections. (Sorry about that!)
It is cherished notion in American political ideology that the market and democracy go happily hand in hand. The purveyors of that myth keep the revolving door turning.
After helping David Cameron to victory, Jim Messina trumpeted his plans for the next year: “I’m coming home tomorrow,” he said, “and it’s whatever it will take to get Hillary [elected].”