Tags: Bernanke | OBrien | Wall Street | Citadel

WaPo's O'Brien: Can We Blame Bernanke for Cashing in on Wall Street Bling?

By    |   Monday, 20 April 2015 06:00 AM

Ben Bernanke may deserve his Wall Street payday, but that doesn't make the revolving door between government service and banking industry riches any less distasteful, according to Washington Post columnist Matt O'Brien.

The former Federal Reserve chair disclosed he has been engaged to advise the $25 billion hedge fund Citadel for what is considered likely a lush paycheck.

"Now Bernanke hasn't disclosed the terms of his compensation, but it's safe to say that if hedge funders are willing to pay him $200,000 just to dispense his wisdom over dinner, they'd be willing to pay him a lot more to do so on a regular basis," O'Brien wrote.

He noted other Washington fiscal and monetary dignitaries who have gone the Wall Street route in recent years include former Treasury Secretary Timothy Geithner, former Fed governor Jeremy Stein and former Office of Management and Budget head Peter Orszag.

O'Brien said it may be hard to blame Bernanke for taking advantage of the dazzling banking industry riches dangled in front of his nose.

"At the same time, though, it's a little disappointing that everyone who goes into public service ends up trading in on that to Wall Street," he wrote. "That's because, even though we take it for granted now, it's worth reminding ourselves how disconnected Wall Street is from any kind of normal economic reality."

O'Brien cited data showing a significant share of the money flowing toward the richest Americans is coming from the financial industries.

Thus, "if you're a policymaker who's made a very good living, but nothing like the dynastic wealth the finance guys you get to know have racked up, why not get a little of that for yourself?" he asked.

"Who wants to be in the top 10 percent when everyone you know is in the top 1 percent?"

Other media outlets also chimed in on Bernanke's cashing in on his Fed credentials.

MarketWatch declared that Bernanke is "bringing quantitative easing to his wallet."

The Atlantic headlined its coverage of the topic: "Ben Bernanke Isn't the Problem, the System Is the Problem"

"Perhaps what makes Bernanke's case so worrisome is that he has an almost universal reputation for probity. If the revolving-door system is so powerful that it can make even him look suspect, is it beyond redemption?" wrote Atlantic columnist David Graham.

Quartz commented that with Bernanke's decision to take advantage of his years helming the central bank, credibility issues arise for him. "Indeed, even if questions about regulation don't center on his exact corner of the financial markets, his opinion will likely hold less sway."

In an interview with The New York Times, Bernanke defended his career decision.

He said he opted for Citadel, in part, because it "is not regulated by the Federal Reserve and I won't be doing lobbying of any sort."

Bernanke told the Times he rejected job overtures from banks. "I wanted to avoid the appearance of a conflict of interest," he said. "I ruled out any firm that was regulated by the Federal Reserve."

© 2019 Newsmax Finance. All rights reserved.

   
1Like our page
2Share
StreetTalk
Ben Bernanke may deserve his Wall Street payday, but that doesn't make the revolving door between government service and banking industry riches any less distasteful, according to Washington Post columnist Matt O'Brien.
Bernanke, OBrien, Wall Street, Citadel
505
2015-00-20
Monday, 20 April 2015 06:00 AM
Newsmax Media, Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved