Government Sachs: Democracy brought to you by Goldman-trained bureaucrats
What do people do at Goldman Sachs all day? They prepare to work at the White House and at the U.S. Treasury Department, that’s what. Even a short list might stun the uninitiated.
- The director of the National Economic Council, Larry Summers, paid lucrative visits to Goldman
- Treasury Secretary Tim Geithner’s chief of staff Mark Patterson was a Goldman lobbyist
- Geithner’s mentor Robert Rubin was a Goldman guy (and now serves at Citigroup)
- Commodities Futures Trading Commission chair Gary Gensler was co-head of finance at Goldman
- The National Economic Council’s deputy director Dianna Farrell did time at Goldman
- Federal Reserve Bank of New York Chairman William Dudley was Goldman’s chief economist for a decade
But one of the most prominent Goldman alumni in Europe today is Mario Draghi, currently the governor of Italy’s Central Bank — and perhaps a key player in Goldman’s backroom deals to hide Greece’s debt.
Draghi is poised to become the president of the European Central Bank, the entity in charge of the Eurozone’s common monetary policy. Despite the fact that he has denied any involvement in the 2000 and 2001 currency trades that hid enough of Greece’s debt to allow it to join the Eurozone, economist Simon Johnson reports that Draghi was, in fact, at Goldman and working on Greek issues in 2002, when Goldman helped sell Greek bonds without informing customers that Greece was hiding its debts.
Will these revelations scuttle Draghi’s chances of ascending to the chairmanship of Europe’s Central Bank? Goldman, and its derivatives, are increasingly unpopular in Europe. But Draghi should take heart: European voters don’t get to decide who heads the Central Bank — and he’ll have plenty of company atop the international banking scene. The head of Canada’s central bank, Mark Carney, is a Goldman alum too.