Obama’s $400,000 Speech
The 44th President will make as for a one-hour speech as his old annual salary. Should we worry about that?
Barack Obama is back from a well-deserved lengthy vacation is his now commencing his post-presidency in what has become the usual way: by becoming a highly-compensated public speaker. His first foray will earn him exactly his former annual salary for one hour’s work.
Ben McLannahan reporting for FT:
At the White House Correspondents’ Dinner a year ago, President Barack Obama teased Hillary Clinton over her six-figure speeches to Wall Street banks. “If this material goes well, I’ll use it at Goldman Sachs next year,” he said. “Earn me some serious Tubmans.”
Less than 100 days after leaving office, Mr Obama has followed through: accepting a $400,000 speaking fee from Cantor Fitzgerald, the mid-sized investment bank.
On Tuesday a person familiar with the arrangement confirmed that Mr Obama had agreed to appear as the keynote speaker at Cantor’s annual healthcare conference in September. The person declined to comment on what the former president might do with his fee, which is nearly twice the $225,000 price commanded by Mrs Clinton during three speeches to Goldman in 2013.
Mr Obama could not be reached for comment.
During his time in office the former president’s relations with Wall Street often appeared strained — particularly in 2009, when he called bankers “fat cats” who kept drawing big bonuses while America went through a deep recession. Republican critics said that his landmark piece of rulemaking after the financial crisis, the Dodd-Frank Act of 2010, went much too far in its efforts to curb risk-taking at the biggest banks.
This is drawing some critiques and not just from the usual suspects.
Aaron Blake at WaPo offers “4 reasons Obama’s $400,000 Wall Street speech is a bad idea.” Rather than cutting-and-pasting the whole column here I’ll just include the bullet points:
1. It continues to set a dubious precedent
2. We have other rules against retroactively cashing in
3. Democrats are trying to be the anti-Wall Street party
4. Obama himself discussed the corrupting influence of such arrangements in his book
Vox’ Matt Yglesias:
Former President Barack Obama’s decision to accept a $400,000 fee to speak at a health care conference organized by the bond firm Cantor Fitzgerald is easily understood. That’s so much cash, for so little work, that it would be extraordinarily difficult for anyone to turn it down. And the precedent established by former Presidents Bill Clinton and George W. Bush, to say nothing of former Federal Reserve Chairs Ben Bernanke and Alan Greenspan and a slew of other high-ranking former officials, is that there is nothing wrong with taking the money.
Indeed, to not take the money might be a problem for someone in Obama’s position. It would set a precedent.
Obama would be suggesting that for an economically comfortable high-ranking former government official to be out there doing paid speaking gigs would be corrupt, sleazy, or both. He’d be looking down his nose at the other corrupt, sleazy former high-ranking government officials and making enemies.
Which is exactly why he should have turned down the gig.
The election in France earlier this week shows that the triumph of populist demagogues is far from inevitable. But to beat it, mainstream politicians and institutions need to shape up — not just with better policies, but with the kind of self-sacrificing spirit and moral leadership that successful movements require.
That means some people are going to have to start making less money and raising the ethical bar for conduct, rather than leveling down to the worst acts of their predecessors.
There’s more at the link but you get the idea.
Amusingly, the conservative New York Post editorial board defends him, albeit in much the way Brutus defended Caesar:
Good for him.
Obama doesn’t really need the money: He earned over $14 million for his first three books, and bidding for his next deal (a package with Michelle) has run over $60 million. But he has every right to cash in on his star power and his hard-won expertise.
No doubt he’ll wind up giving a good chunk of it to charity (though we’d be majorly surprised if he set up anything resembling the Clinton Foundation).
All that said, there is something a bit . . . rich here, given what Obama had to say in a 2010 speech pushing tougher Wall Street regulation:
“We’re not trying to push financial reform because we begrudge success that’s fairly earned. I mean, I do think at a certain point you’ve made enough money.”
Which makes you wonder when Obama will reach the point where he’s earned enough.
Pushing back, CNAS’ Loren DeJonge Schulman, who served multiple senior posts in government, most recently as senior advisor to Susan Rice, argues persuasively that this pushback is silly. In a tweetstorm last evening, she hit back at HuffPo CEO Lydia Pollgreen’s questioning of the fee, observing “President Obama worked harder than you ever have in your life for eight years. His experience [is] immeasurable.” She added, “If people want to pay him extraordinary amounts of money for him to be candid with them about the problems he saw they caused / can help fix.” Additionally, she notes, former presidents need to make a living and wonders what his critics would have him do, ”Reopening a law practice? Con law professor?”
This morning, presumably reflecting on pushback to her tweets, she observed, “Some think Obama has [created the] appearance of being bought w/speech? Y’all. You know what he can charge for just sitting as advisor at same firms right”?
I’m neither particularly outraged by the speaking fee—presidents who don’t cash in on the speech circuit have been the exception since Ronald Reagan inaugurated the practice—nor thrilled with it. The possible objections fall into a few buckets:
Corruption
Many, myself included, were quite uncomfortable with the appearance of impropriety in the various Clinton Foundation entities twisting the arms of business leaders and foreign governments for huge donations while Hillary Clinton was in office (the Senate, Secretary of State) or running for the presidency. Despite no evidence that any favors were done in exchange for these contributions, the mere fact that one might reasonably conclude that access to power could be influenced by these donations was a rather powerful incentive to participate.
Barack Obama, of course, is not in this position, Unless we amend the Constitution, he’s ineligible to run for president again and it’s extremely unlikely he’ll follow the John Quincy Adams precedent and return to the Senate. Given his age and Republican control of the White House and Congress, it’s even less likely he’ll follow William Howard Taft’s precedent and wind up on the Supreme Court. I suppose it’s possible that Michelle will follow Hillary Clinton’s lead and cash in on the name recognition she accrued as First Lady to launch a political career, but there’s no indication she has any such intention.
It’s much easier to see how, knowing that a lucrative speaking career awaits upon leaving office, presidents and other politicians might change how they govern to avoid antagonizing those with the most ability to pay. Yet, while Bernie Sanders and others in the Progressive wing of the Democratic Party have charged that Obama was too soft on Wall Street, there’s simply no reason to believe that he was even slightly influenced by the prospect of cashing in. While I voted against him both times he ran and was a frequent critic of his presidency, his character is beyond reproach on this score.
Then again, it’s not at all difficult to imagine a less scrupulous successor very much thinking about the office as a platform for lining his or her pockets. Indeed, it’s quite easy.
That said, contra Matt Yglesias, I’m not sure it’s reasonable to expect Obama to bear the burden of setting that example. Nor, indeed, would his setting an example of non-corruption be likely to influence a less scrupulous successor to behave in the same manner. If we’re concerned about former officials cashing in, then we need to codify the restrictions into law and apply them to everyone, not just the righteous.
Dignity of the Office
Even if we don’t think ex-presidents are going to be corrupt—because we believe they’ll obey their oath while in office and are out of favors to give once their political career concludes—there’s still the argument that it sullies the office for them to be out hustling for appearance fees. I’m sympathetic to that sentiment.
On the one extreme, we actually could simply insist that former presidents simply live on their pensions. I know Loren meant it as a straw man bu $203,700 per year is, after all, a pretty good living! And they get office expenses, security, free limo service, and other pretty cool perquisites over and above that. For that matter, given how few living ex-presidents there are, we could up their pension to, say, $500,000—even $1,000,000—a year without busting the budget.
If we’re going to allow them to make outside money, though, drawing a line is rather difficult. Both Barack and Michelle Obama got massive advances for forthcoming books. Why is that any better than taking speaking fees? Would speaking fees of, say, $20,000 but less risable than $400,000? And what of the absurd amounts that retired generals and other senior government officials routinely get for sitting on corporate boards? Would we deny that to ex-presidents and only ex-presidents?
Egalitarianism
The third set of arguments I’m seeing is the one coming from the Progressives: that it’s simply unseemly for ex-presidents to make so much money. Not because of influence peddling or the perception thereof. Not because it lowers the dignity of the highest office of the land. No, simply . . . because. We live in an era of extreme economic inequality and it’s just not right for former presidents to add to that when they leave office. I am, as regular readers might suspect, not particularly sympathetic to this argument.
Blake’s WaPo essay, cited above, points to this excerpt from Obama’s Audacity of Hope:
Increasingly I found myself spending time with people of means — law firm partners and investment bankers, hedge fund managers and venture capitalists. As a rule, they were smart, interesting people, knowledgeable about public policy, liberal in their politics, expecting nothing more than a hearing of their opinions in exchange for their checks. But they reflected, almost uniformly, the perspectives of their class: the top 1 percent or so of the income scale that can afford to write a $2,000 check to a political candidate. …
And although my own worldview and theirs corresponded in many ways — I had gone to the same schools, after all, had read the same books, and worried about my kids in many of the same ways — I found myself avoiding certain topics during conversations with them, papering over possible differences, anticipating their expectations. On core issues I was candid; I had no problem telling well-heeled supporters that the tax cuts they’d received from George Bush should be reversed. Whenever I could, I would try to share with them some of the perspectives I was hearing from other portions of the electorate: the legitimate role of faith in politics, say, or the deep cultural meaning of guns in rural parts of the state.
Still, I know that as a consequence of my fundraising I became more like the wealthy donors I met, in the very particular sense that I spent more and more of my time above the fray, outside the world of immediate hunger, disappointment, fear, irrationality, and frequent hardship of the other 99 percent of the population — that is, the people that I’d entered public life to serve. And in one fashion or another, I suspect this is true for every senator: The longer you are a senator, the narrower the scope of your interactions. You may fight it, with town hall meetings and listening tours and stops by the old neighborhood. But your schedule dictates that you move in a different orbit from most of the people you represent.
This isn’t about corruption in the classic sense. He wasn’t saying that he was shaping his policy positions to make fat cats more likely to donate. Rather, he’s saying that, simply spending so much time around the fat cats, he was becoming more like them. I have no doubt that’s true. But I don’t see an argument why, as a matter of social mores–much less public policy–we should particularly worry.
Overall, I’m squeamish about ex-presidents cashing in. But, aside from the singular instance in which he was married to someone working to succeed him in office, I’ve never thought it rose to the level of grave public concern. In the particular case of Barack Obama, I’m confident in his personal integrity. And, if he parlays his eight years in the White House to amass the wealth of, say, an NBA star, a Hollywood leading man, or, heaven forfend, Oprah, I’m not sure why I should be outraged.
The teaser for this post asked “should we worry about that?” As usual in the internet world, if a post includes a question in the title, the answer is most always “no.”
Meh….
At a time when blatant corruption is rampant in the White House this strikes me as a 16 oz. nuthin’ burger with cheese.
Too open-ended a question. Why shouldn’t he? His political career is over, so he’s a private citizen. Lots of retired politicians do it. And it depends on the topic – if he takes $400K to tell them they’re wonderful people it would be disappointing, but if he takes it and tells them what they don’t want to hear, that would be great.
The reactions are overblown.
If you like your cronies’ $400,000, you can keep your crony $400,000
“@Daryl’s other brother Darryl:
So, sexual predation by a sitting President and the enabling fostered by his wife is OK then?
If a substantial portion of the fees were directed into a foundation, I wouldn’t mind. As purely personal income, a bit iffy, IMHO.
Of all the recent ex-Presidents, I think Carter set the best precedent overall.
What Obama should do is run for governor of Texas. You can get rich while serving in office there. It’s amazing how prescient in land speculation those officeholders become after reaching the governorship.
Just one of the ways Presidents get paid…. after the fact.
Someone (publisher) will advance him millions to write a book, whether they can recapture the amount through sales or not….
Unless you’re interested in stopping stuff like this for everyone, then there’s nothing to see here, move along.
It’s a little disingenuous to call this 1 hour of work. It’s like like he shows up cold with no preparation.
@Daryl’s other brother Darryl: Check under the bun again–no cheese (or lettuce and tomato, either).
Wait till Trump is an ex-president…
@James Pearce:
Do you think he’ll be capable of staggering up to a lectern by then?
@john430:
You get dumber with every comment you type.
According to Forbes, Trump asked for and apparently got 1.5 million per speech in his pre-presidency days.
My perspective: Hillary gives 3 speeches at Goldman Sachs netting her about $600,000 – conservatives are outraged. Trump brings in to his administration a flotilla of Goldman Sachs people to be in his cabinet, to advise him – conservatives are NOT outraged.
America runs on money yet we pretend to be outraged when our ex-presidents make money.
In the case of Obama and Goldman Sachs, I’m pretty sure this is some kind of Russian mob money laundering scheme.
@CSK:
Correct. He had the party paying him donate $1.5 to his “foundation” so they got a tax break, and he got paid tax-free. Then he used foundation money for personal use; buying things like sports memorabilia and portraits of himself, or paying the legal fees required by the thousands of lawsuits against him.
Like I said above…when blatant corruption is rampant in the current White House, who cares if Obama gets a pay-day?
Today, Trump’s going to announce a tax plan that would drastically benefit himself, to the tune of millions. On taxes he refuses to show anybody. I wish B-Rock set a superior example on stuff like this, but it’s not the big story today.
Nice work if you can get it. And I can think of few groups that need to be separated from $400,000 more than Cantor-Fitzgerald. And I expect he will do the rest of Wall Street soon enough.
Overall, the people who are most upset about this are probably the Wall Street folks in the Trump administration. Had they kept their previous jobs, they would have gotten to hear to real president speak, instead they sometimes share a room with Trump’s blathering.
Ivanka’s doing family business deals in between diplomatic tasks. WTF.
@CSK:
Yes.
Trump will live into his 90s. The US spares no expense when it comes to the health of our ex-presidents.
Hahahahaha….
The latest version of TrumpRyanCare allows Congress to keep it’s Obamacare.
Hahahahaha….
You cannot make this stuff up.
http://talkingpointsmemo.com/dc/obamacare-republicans-exemption-waiver-ahca
@teve tory:
Yes, and up until the other day the State Department was advertising Mar-a-Lago on its website.
@John Peabody: Usually. As with many things, I don’t worry about it in the specific but perhaps in the general. I don’t think we need a lot of rules to make Obama behave responsibly. Trump?
@Daryl’s other brother Darryl: I allude to that in the OP.
@Tony W: That occurred to me but 1) people at this level don’t tend to write their own speeches and 2) most of the speech will be repackaged time and again down the line.
Anyone remember George W. Bush, the born-to-wealth millionaire parasite who never worked a day in his life, whose business ventures were all losses & who should have been dragged from the White House in chains as a war criminal. saying how he planned to “replenish the ol’ coffers” by giving bullshit & platitude speeches to his fellow wealthy parasites? You could look it up.
And w/ Trump in office & in the pockets of Russia & his own fool ignorance, please stop reciting this tiresome crap:
Do you in any way see how something similar might just apply to any of Trump’s actual fricking properties, from which he literally & directly derives actual income, every single day?
Here’s a clue: Stop deflecting to the past & start dealing w/ the present & the future, before it’s too damn late!
At this point, I’m more concerned about Ivanka’s proposed “investment fund” for women entrepreneurs, and about a kazillion other dubiously ethical things that the current president is doing. If we’re going to change the rules on what a former president can do to earn money, let’s take that up when the current “billionaire” leaves the White House, surely he doesn’t need the money and then everyone else running for president will know before they go into the gig that it means not just sacrificing earnings while you are doing the job, but after it too.
@M. Bouffant:
Apparently Dumb-Don is in violation of our Constitution…shocking…
http://www.salon.com/2017/04/26/donald-trump-is-getting-rich-off-states-and-thats-causing-a-major-ethics-problem/
Yeah, I think the critics of Obama’s speech are over-thinking it. He’s not obligated to turn down dumptrucks full of money because it might make some of his supporters squeamish.
Simple: do we believe in capitalism or not? If you believe in the free market and the private citizen’s right to earn as much as he wants, then this is a total STFU. He’s not in government anymore so his paycheck is his own. He doesn’t have to give a damn thing to charity, he doesn’t have to answer to you on who he speaks to, and he can charge whatever the hell he wants. ‘Murica, that’s why!
If you believe in limiting a former President’s ability to profit from the position, then be consistent because we have a President now who’s going to milk it for what its worth for the rest of his life. Whatever rules and standards you apply to Obama will apply to Trump. Feel free to try and pass a law if you like because that’s the only way you’ll get compliance – good luck getting it through a court, though. The standard exception that a former President should not be a gold digger is a good one but is a social norm, not a legal one. As private citizens, they are free to do as they wish within the bounds of the law.
If you believe a former President should not profit at ALL from the position, well… please see above. Good luck, buddy -you’re gonna need it. Although I will ask, is it because you have some squeamish morals about lingering duty or is it because you don’t want to see certain people making a good chunk of change for just being them? As much as I don’t like Trump, I can’t begrudge him the money he’s gonna fleece off his flock post-Presidency. If they are willing to pay, he’s willing to take. Same goes for Obama – he can charge what the market is willing to bear.
So:
Conservative thought says that in a free market environment, labor and product will have a price commensurate with the need for that item.
(source: http://www.myaccountingcourse.com/accounting-dictionary/free-market-system )
And, in this discussion we find a person, with specific skills, and a unique perspective and set of past experiences, chooses to work, and ask for a salary that he believe is fair and set my what the market will pay, and, in doing so, breaks no laws or causes undue hardships on others.
My question is this:
Are those that are most outspoken against the ex-President speaking… are they saying that he should NOT earn what the free market will pay for his services… or that he’s too rich already?
So, NO against free market and YES for wage and price control ???
I don’t get it.
Should I not seek what I can charge for my services?
James, I think you summed it up perfectly, so I’ll only add some historical comments from personal memory
– Gerald Ford – Don’t remember any speeches, but he was a “board member” of at least two or three investment companies (maybe REITS or their equivalents?) that solicited funds by mass mailings. I felt they were sketchy at the time
– Ronald Reagan – famously gave a $1M paid speech to the Japanese within months of leaving office. This was at a time when many were worried that Japan would eventually supplant the US as the world’s economic leader. (Hard for the younger folks here to believe, no doubt)
– George H.W. Bush – I have personal experience with this: he gave a speech as a keynote to a trade show (packaging equipment) I attended. It was a boilerplate “International trade is good” speech and I don’t remember much about it
– Bill Clinton – I also have personal experience here: he gave a keynote speech at a different trade show (Medical Devices) I attended. I’ll give him this, he was an exciting and dynamic speaker and worked in some really relevant observations about the medical device landscape, as well as an amazing understanding of the changes in the entire Healthcare field. In fairness to HW, healthcare is a decades long signature issue for the Clinton’s, while no one gives a rat’s *ss about packaging.
– George W. Bush – like the other ex-P’s has been on the lecture circuit since leaving office.
Booking big name speakers has virtually nothing to do with politics or hoping to influence policy, it’s all about demonstrating just how important your trade show is.
W. Bush is getting 100 – 175K$ per speech without anyone making a thing of it. If W is worth up to 175K, Obama is easily worth 400K.
For all the complaining about Trump around here, it’s sadly unsurprising that many of those same people don’t understand how this kind of thing is a tiny piece of the puzzle in how he ended up as President.
Mike
@MBunge:
He ended up President because people like you don’t use the brain you were born with.
The Twittering Sham-Tan is giving himself a bigger tax-cut than Obama’s speaking fee.
@MBunge: You’ve become tedious, M. I think most of us libtards here understand better than you how Trump became president. But, speaking of how Trump became prez gives me enough of a segue to go off topic. In response to all the people who’ve said,
The dreaded (by some) Kevin Drum points out that it wasn’t that close until Comey’s late October ‘OMG! we found more HILLARY EMAILS letter.’ Hillary was leading by 6% the day before. Way more than enough to have carried PA, MI, and WI.
All of us libturds are asking ourselves, “OK, why didn’t she have 10%?, How do we get white working class people back on board without sacrificing the minorities in out coalition?’ More to the point, so are people deep in the bowels of the DNC, at liberal think tanks, and on the staff of prospective candidates. As they do so, I hope they will realize, as Matt Yglasias points out, Trump supporters are the most overrated force in American politics. Like Economics, electoral politics happens at the margins. There are a lot of people who voted for Trump: the minority of a minority that voted for him in the primaries, the large number who voted for Trump in the general because they always vote for the R, and the smallish number of “marginal” Trump voters, the swing voters.
I also trust that the Dem strategists recognize the Rs won by ratfucking. Not just Comey but the years of Benghazi!!!, emails!!! that preceded it all the way back to Whitewater!!!. I hope they have plans for countering the GOP character assassination machine. I also hope they can figure out how to counter the massive infrastructure and money disadvantage at the state level.
@MBunge: Give me a break. The average voter doesn’t care about ex-presidents giving speeches to Wall-Street. I mean Trump is looting the country as we speak and not a single Trump voter/supporter cares.
Honestly, your post is another example of how the left lives in their own bubble and that they think the general public is as hostile to Wall Street and large sums as much as they are.
@James Joyner
If a man establishes a two-tier justice system to protect large financial institutions and is then handed a check in the amount of $400,000 (and many more to come) by those institutions, what would you call it? You don’t find it an amazing coincidence this perfectly gets around the remaining ethics laws on the books?
Remember when Democrats cared about income inequality, greed, corruption, and the undue influence the rich have over the political system. Remember when they spoke truth to power and Occupied Wall Street? With one $400,000 speech, Obama almost hits the top 1%. He should have held out for just a little bit more. That would have been truly poetic.
@James Joyner
Is it your contention that Obama has something to say to financiers worth more than $400,000?
@Ben Wolf: “If a man establishes a two-tier justice system to protect large financial institutions and is then handed a check in the amount of $400,000 (and many more to come) by those institutions, what would you call it?”
You think obama established preferential treatment for the crimes of the rich?
@Ben Wolf: No, I’m suggesting that he’s going to get appearance fees in this range pretty much as often as he wants it for years to come. But, even at 25 speeches a year—which I suspect is a high figure—he’ll make much less this year than Lebron James.
@James Joyner: but if he’s going to be preaching to us about the evil rich….
@Gavrilo:
Son… are you sayin that some of the 1% don’t care about that?
I’m part of the 5%, and I’m not even trying hard. And I don’t think I’m alone on this little corner of the internet.
I’m damned proud to be a Democrat, and hell YES, I care about other Americans and my country.
I’m an immigrant’s kid, started poor, and made it. I’m proud to be a citizen, vote, and pay taxes.
I’m sure as s#it NOT part of the party that is trying to take away heath care from 10’s of millions of Americans, raising costs on the elderly, cutting taxes for the rich, and supporting whatever whim comes from the current White House occupant, and are choosing to be FOR increasing the deficit (after being against it).
Shed no tears for me, I sleep well at night.
@Liberal Capitalist: Well of course you should; but he’s bCLANG after all. It’s different for that kind.
OT, but can I just say I like that picture of Obama? You can almost hear him thinking, “Woo-hooo! You don’t have me to kick around anymore, y’all!”
@Daryl’s other brother Darryl:
By your twisted logic corruption is only bad if it is attributed to Republicans and Democrats are exempted. Hypocrisy, thy name is Democrat.
@john430 vote poll Hot Topic: LOL! Hot Topic votes. So, it’s disgusting corruption if Republicans
do unseemly things while in office but Democrats get a pass, eh? Frankly, I’d be happier if someone looted the Treasury instead of preying on young women.
That’s typical of leftist doublethinktalk at it’s best.
Would you rather leave your cash laying around for Republican Trump to pick up or would you rather drop your daughters off at Democrat Bill Clinton’s place for an evening of sexual predation and exploitation?
@john430:
Wait are you seriously arguing that Obama is still in office?
Hey, James how about a post about how Obama has made a $2 million donation to a youth jobs program in Chicago? If that’s how he spends him money, he can charge as much for a speech as he wants.
You might also want to do a post on how much the worth Trump trash family is costing the taxpayer so far.