Factchecking the claim that only 8% of the current cabinet has private sector experience. This site rates the claim false, and extracts an apology from the author of the original study, Michael Cembalest, the chief investment officer for J.P. Morgan Private Bank. After Cembalest published the study in Forbes, Glenn Beck lifted a chart from the study and presented it without explaining how Cembalest reached his conclusions. From there, the chart circulated on the internet.
politifact.com
Someone posted this yesterday on Mish's thread.
Excerpt:
We wondered if the claim was right, so we did some math of our own.
In Obama's Cabinet, at least three of the nine posts that Cembalest and Beck cite — a full one-third — are occupied by appointees who, by our reading of their bios, had significant corporate or business experience. Shaun Donovan, Obama's secretary of Housing and Urban Development, served as managing director of Prudential Mortgage Capital Co., where he oversaw its investments in affordable housing loans.
Energy Secretary Steven Chu headed the electronics research lab at one of America's storied corporate research-and-development facilities, AT&T Bell Laboratories, where his work won a Nobel Prize for physics. And Interior Secretary Ken Salazar, in addition to serving as Colorado attorney general and a U.S. senator, has been a partner in his family's farm for decades and, with his wife, owned and operated a Dairy Queen and radio stations in his home state of Colorado.
Three other Obama appointees had legal experience in the private sector.
Secretary of State Hillary Rodham Clinton, Agriculture Secretary Tom Vilsack and Commerce Secretary Gary Locke spent part of their careers working as lawyers in private practice. Clinton and Vilsack worked as private-sector lawyers at the beginning of their careers, while Locke joined an international law firm, Davis Wright Tremaine LLP, after serving as governor of Washington state. At the firm, Locke "co-chaired the firm's China practice" and "helped U.S. companies break into international markets," according to his official biography. That sounds like real private sector experience to us.
Finally, Treasury Secretary Timothy Geithner worked for Kissinger Associates, a consulting firm that advises international corporations on political and economic conditions overseas.
The occupants of the two remaining Cabinet posts cited in the chart do not appear to have had significant private-sector experience: Labor Secretary Hilda Solis and Transportation Secretary Ray LaHood.
Obama's Cabinet has even more private-sector experience if you go beyond the nine. Two of the Obama appointees could be considered entrepreneurs — the very people Beck would "unleash." Vice President Joe Biden, officially a Cabinet member, founded his own law firm, Biden and Walsh, early in his career, and it still exists in a later incarnation, Monzack Mersky McLaughlin and Browder, P.A. (The future vice president also supplemented his income by managing properties, including a neighborhood swimming pool.) And Office of Management and Budget director Peter Orszag founded an economic consulting firm called Sebago Associates that was later bought out by a larger firm.
It's also worth noting that if you examine a larger group of senior Obama administration appointees, you'll find that more than one in four have experience as business executives, according to a June study by National Journal . That compared with the 38 percent the magazine found eight years earlier at the start of George W. Bush's administration. That's at least three times higher than the level claimed by Beck.
We tracked down Cembalest to ask about his methodology. He said any effort to address the topic is heavily subjective, and he expressed regret that his work had been used for political ends, saying that it was not his intention to provide fodder for bloggers and talk show hosts.
Cembalest said that he did discount the corporate experience of the three lawyers we identified — Clinton, Vilsack and Locke — and added that he awarded nothing for Donovan, Chu or Salazar, even though we found they had a fair amount private sector experience. Cembalest acknowledged fault in missing Salazar's business background, saying he would have given him a full point if he had it to do over again. But he added that the kind of private-sector experiences Chu and Donovan had (managing scientific research and handling community development lending, respectively) did not represent the kind of private-sector business experience he was looking for when doing his study.
"What I was really trying to get at was some kind of completely, 100 percent subjective assessment of whether or not a person had had enough control of payroll, dealing with shareholders, hiring, firing and risk-taking that they'd be in a position to have had a meaningful seat at the table when the issue being discussed is job creation," Cembalest said.
Cembalest said he has "written 250,000 words in research over the last decade, and every single thing I've ever done — except this one chart — was empirically based on data from the Federal Reserve" or another official source. "This is the one time I stepped out into making judgment calls, and I assure you I won't do it again. ... The frightening thing about the Internet is that people copy one chart from what you write and then it goes viral. So I've learned a lesson here that these kinds of issues are best left addressed by the people who practice them day in and day out."
Which brings us back to how Beck used Cembalest's data. We'll acknowledge that rating someone's degree of private-sector experience is an inexact science, and it's true that Beck accurately relayed the information contained in Cembalest's chart. But at PolitiFact we hold people accountable for their own words. So we rate Beck's claim False. |
