We hear, repeatedly, on SI that the Dems have no ideas, no proposals, not for foreign policy or domestic policy. Or that they advocate "failed" policies.
Well, here's one more piece of evidence that's not the case. Some of the proposals that might appear if the Dems got a voice by taking control of one of the houses of congress are being advocated in Robert Rubin's new think tank.
I'm of several minds about the wisdom of these proposals in the proverbial perfect world, but they are light years better than the present set being pushed by the Bush people.
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The New York Times
September 8, 2006
New Role for Rubin: Policy Guru
By LANDON THOMAS Jr.
Does Robert E. Rubin still matter?
Many would probably say yes. In Washington, Mr. Rubin, who was President Bill Clinton’s Treasury secretary, has started a small research group aimed at generating policy ideas for Democratic presidential candidates, as well as elevating the next generation of Democrat-supporting financiers.
On Wall Street, Mr. Rubin, from his perch on the board of Citigroup, has become an influential public defender of its chief executive, Charles O. Prince III, who is feeling the lash from investors over the stock’s long stagnant run.
Just don’t ask the man himself.
“I am a little pebble of sand on the beach,” Mr. Rubin, 68, said this summer, speaking on a panel for his new policy initiative, the Hamilton Project. “So what I say does not matter anymore.”
It was a classic form of a Bob Rubin koan. Asked why he didn’t use his sway on Wall Street to prod policy makers in Congress, he offered up a slight smile and a nod of his gray head. So self-denying was the assertion that it bordered on self-aggrandizement. The audience, let in on the joke, laughed.
But, as Democrats hope to take over control of the House from Republicans and as an aspiring presidential class of 2008 becomes more assertive, the Hamilton Project, named after the founding father and onetime Treasury secretary Alexander Hamilton, is arguably Mr. Rubin’s most overt political act since he stepped down from the Treasury in 1999. Mr. Rubin, naturally, denies any such crass intent.
Housed in the Brookings Institution, the initiative embraces a number of mainstream economic prescriptions — like the necessity of equitable international trade agreements, the virtues of a balanced budget, and making economic growth more broad-based — that capture Mr. Rubin’s eat-your-spinach approach to policy making.
But by addressing issues like the costs to the economy of excessive litigation and regulation, Mr. Rubin intends to make the project a laboratory for the type of pragmatic, ideology-free policies that appeal to the project’s Wall Street advisers while also hoping to lure Democratic presidential candidates away from populist economic positions. And with Mr. Rubin and his successor and friend Lawrence H. Summers on board, it will also be a training ground for the next crop of financiers with ambitions to shape policy in a Democratic administration.
They include those who have done so, like Roger C. Altman, the chairman of Evercore and a former deputy Treasury secretary; those who aspire to do so, like Steven Rattner of Quadrangle, the private equity firm; and, perhaps most important, younger Wall Street executives just now flirting with the idea.
It is with this last group of executives, drawn largely from the booming world of hedge funds and private equity, that Mr. Rubin has loomed large as an Obi-Wan Kenobi figure.
In the 1980’s he cultivated their early careers as arbitrage traders at Goldman Sachs, and he is now guiding them in the ways of securing influence in Washington.
Eric Mindich, who runs Eton Park, a $5 billion hedge fund, led Goldman’s arbitrage desk at the age of 25, and in 1994, at 27, became Goldman’s youngest partner ever. Of the bunch, he comes the closest to being Luke Skywalker: a Harvard graduate like Mr. Rubin, he is a trustee and major donor, with Mr. Rubin, at the Mount Sinai Medical Center. He is also a contributor to Mr. Rubin’s favorite senator, Kent Conrad, the Democrat from North Dakota.
Then there is Richard C. Perry, who left Goldman’s arbitrage desk in 1988 to form Perry Partners, now an $11 billion hedge fund. And Thomas F. Steyer, the founder of Farallon Capital, a $16 billion hedge fund, who also worked under Mr. Rubin in the 1980’s and was an adviser to Senator John Kerry’s presidential campaign in 2004.
All three men are generous Democratic donors. But in the public policy realm they are relative neophytes — just as Mr. Rubin was in the early 1990’s before he signed on with President Clinton.
“This is not a political undertaking,” Mr. Rubin said in an interview. “There have been some major policy disappointments and they need to be debated. You can conduct this debate without engaging the question of political attribution.”
Asked if the project would take aim at Bush administration policies that he has criticized publicly, like tax cuts and the fiscal deficit, Mr. Rubin took the high road.
“If you go over everything I have said, you would never see the word ‘Bush,’ ” he said. “I make a distinction between policy and politics. There are some immense issues — the stagnancy of real wages, economic security, the fiscal deficit. We are trying to stir debate.”
True to his word, the initial output from the project has had a heavy, if not eye-glazing, emphasis on policy, and has been light on the politics. Among the topics tackled are the volatility of income levels, improving productivity of the federal government, and ensuring that free trade remains friendly to American workers. “When Bob Rubin and others are involved, it becomes an important vehicle,” said Orin S. Kramer, a hedge fund investor and a prominent Democratic fund-raiser. “And if you are trying to change the direction of policy, that is what politics is all about.”
So while Mr. Rubin remains above the fray — he says he will not lend his support to any individual until the party chooses a Democratic candidate — most of the others he has recruited have already become fully engaged.
Mr. Altman, a college classmate of President Clinton who also served briefly in his administration, has emerged as Senator Hillary Rodham Clinton’s leading economic adviser, and Mr. Perry, Mr. Steyer and some other financial executives have lent their financial support.
The project is largely financed by Mr. Rubin and his financial backers, all of whom contribute an equal amount each year — said to be between $100,000 and $150,000 — to its approximately $2 million operating budget.
As he has done in politics, Mr. Rubin has kept himself at a distant remove at Citigroup, his base of operations since 1999, particularly from the criticisms leveled at Mr. Prince over the bank’s sluggish growth.
Partly this is a consequence of his unusual job description. As an executive at the company, he has no operational responsibility, and as a director he sits on no board committees (the executive committee, of which he is chairman, rarely meets). And partly it is a function of his personal style.
“He has this enormous influence and yet he is not on the radar screen when people are looking to assign credit or blame,” said Michael Holland, an investor and longtime shareholder of Citigroup. “I presume it is very comfortable for him that way.”
At Ford, where he was a director since 2000, he stepped down last month, citing banking conflicts.
Still, there are some who have asked what it is that he does to earn his guaranteed $15 million a year. An influential rainmaker at the company, he meets frequently with clients in the public and private sectors. His outside interests are broad as well as time-consuming. As part of his contract, he is given free rein to indulge himself in this regard and to use Citigroup’s planes to do so.
Last year, he booked $330,000 worth of personal travel time, almost three times as much as Mr. Prince logged, according to the bank’s proxy. Starting this year, he will reimburse Citigroup for his personal use of corporate aircraft.
At Citigroup’s investor day last year, Michael L. Mayo, a bank analyst with Prudential Equity Group, put the question directly to Mr. Prince: What is it, exactly, that Mr. Rubin does?
“He has been very, very important in our strategic thinking,” Mr. Prince replied. “Especially about international. Bob is a big influence in the place.”
As a member of the chairman’s office with Mr. Prince and part of the committee of 12 business heads, Mr. Rubin has become a valued adviser, especially now, given the youth and untested qualities of Mr. Prince’s potential successors.
“My office is right next to Chuck’s and he uses me as a sounding board,” said Mr. Rubin. Currently, a crucial matter of debate on the board has been how much Citigroup needs to invest in its investment bank and consumer franchise to make up for the years of neglect in these areas. Mr. Prince, with the support of Mr. Rubin, has been an advocate for an aggressive commitment of more resources. Other directors have been less enthusiastic as costs have increased.
“I think he is on the right track,” Mr. Rubin said. “My impression of the board is that there is broad-base agreement to invest to get us where we need to be. If there is discussion, it’s a matter of degree and pace.”
Hhttp://www.nytimes.com/2006/09/08/business/08wall.html?_r=1&oref=slogin |
