Larry’s Cush Job
Apparently Larry Summers made $5.2 million working approximately one day a week at D. E. Shaw, a “quant” based hedge fund on Wall Street. Nice work if you can get it.
Now this is the job we want. According to the NYT, Larry Summers worked just one day a week while making $5.2 million in two years at hedge fund D.E. Shaw.
So let’s say he worked 100 days total, that’s $52,000 per day.
And assuming he worked about 12 hour days, that’s $4,333 per hour.
Now of course, that isn’t tax payer dollars, but in terms of bloated executive compensation I think we found a good example. And in terms of speaking gigs, in looking at various 8-Ks it looks like the money Larry raked in is…well dubious to say the least.
And it isn’t just Larry Summers here, nor is it just the Democrats. Henry Paulson worked at Goldman Sachs, Robert Rubin also from Goldman Sachs, and Lloyd Bentson spent 16 years in the financial sector in Houston, and prior to that Nicholas Brady. I’m sure if we kept going back it would be the case that Treasury Secretaries typically come from Wall Street. Hence the incestuous nature of Wall Street and Washington D.C.
I think part of the problem here is this incestuous relationship between Wall Street and D.C. Switch back and forth and in the process end up a mutli-millionaire working 1 day a week.
Update: In my first post on this, commenters with a decidedly liberal slant, took me to task on this news. They said I should be posting it over at FreeRepublic.com. Of course, we have this post by Glenn Greenwald and here is a juicy excerpt,
That’s $135,000 paid by Goldman Sachs to Summers — for a one-day visit. And the payment was made at a time — in April, 2008 — when everyone assumed that the next President would either be Barack Obama or Hillary Clinton and that Larry Summers would therefore become exactly what he now is: the most influential financial official in the U.S. Government (and the $45,000 Merrill Lynch payment came 8 days after Obama’s election). Goldman would not be able to make a one-day $135,000 payment to Summers now that he is Obama’s top economics adviser, but doing so a few months beforehand was obviously something about which neither parties felt any compunction. It’s basically an advanced bribe. And it’s paying off in spades. And none of it seemed to bother Obama in the slightest when he first strongly considered naming Summers as Treasury Secretary and then named him his top economics adviser instead (thereby avoiding the need for Senate confirmation), knowing that Summers would exert great influence in determining who benefited from the government’s response to the financial crisis.
Glenn Greenwald posts at FreeRepublic.com, who knew?
Oh, and here is a good bit,
Just think about how this works. People like Rubin, Summers and Gensler shuffle back and forth from the public to the private sector and back again, repeatedly switching places with their GOP counterparts in this endless public/private sector looting.
But hey, Summers donated $135,000 of that $8.7 million to charity, so I guess its okay.
This is pretty obvious: I don’t begrudge these guys making money, but if they screw up, then they ought to go down with their ship. Problem is they are smart enough to insulate themselves from such punishment. As long as they toss us enough crumbs to feel satisfied, we will keep the pitchforks in the barn.
Steve, do you read this guy? Did he write “Liar’s Poker?”
http://cunningrealist.blogspot.com/
Michael Lewis wrote Liar’s Poker, and I’m pretty sure he’s making too much $$$ from writing under his own name to be blogging.
But I’ve liked Cunning Realist for a while now … hadn’t looked at him lately, so I’m grateful for the reminder.
— Steve V. is absolutely right when he says
I think part of the problem here is this incestuous relationship between Wall Street and D.C.
— where “the problem” isn’t just Summers’s absurd salary, but the present crisis. See Simon Johnson:
Wall Street is a very seductive place, imbued with an air of power. Its executives truly believe that they control the levers that make the world go round. A civil servant from Washington invited into their conference rooms, even if just for a meeting, could be forgiven for falling under their sway. Throughout my time at the IMF, I was struck by the easy access of leading financiers to the highest U.S. government officials, and the interweaving of the two career tracks. I vividly remember a meeting in early 2008–attended by top policy makers from a handful of rich countries–at which the chair casually proclaimed, to the room’s general approval, that the best preparation for becoming a central-bank governor was to work first as an investment banker.
A whole generation of policy makers has been mesmerized by Wall Street, always and utterly convinced that whatever the banks said was true.