For high-ranking public-sector officials with significant economic experience, selling out to the private sector once you’re out of office is about the easiest thing in the world. Most Wall Street banks, private equity firms, and white-shoe law firms love hiring former government muckety mucks through the revolving door — it gives them a prestigious name to put on the firm letterhead and access to a world-class Rolodex, and all that’s required for them to dish out is a fat salary and a ceremonial job with little actual responsibility.
It was widely assumed that former Treasury Secretary Tim Geithner would follow in this well-trod path, despite his repeated insistence to the contrary. (Last month, in an interview with New York’s Jessica Pressler, he called the idea that he would end up on Wall Street “extremely unlikely.”) Geithner has never worked at a bank, but his deft handling of the 2008 financial crisis and his deep involvement with all of the major players would make him an instant hire at any major firm he applied to.
So it’s notable that instead of taking a seven-figure salary from a Wall Street firm immediately upon retirement, Geithner’s first moves as a now-former cabinet member are taking a position as a “Distinguished Fellow” at the Council for Foreign Relations and shopping a book proposal.
Many pundits are noting that Geithner’s refusal to jump immediately to a cushy Wall Street job doesn’t mean he’s forsaking the revolving door forever. President Obama’s budget guru, Peter Orszag, took a CFR fellowship immediately after he left office; today, he’s at Citigroup. The CFR is a fairly comfortable pit stop for Geithner; he’s worked there before, and his mentor Bob Rubin is the co-chair. Geithner could well use the next year or two to work on his memoir, write some white papers, and go on the lecture circuit, before eventually succumbing to the wiles of Wall Street.
But I wouldn’t bet on it. I actually believe Geithner when he says he won’t end up on Wall Street. Sure, there’s a bit of an image management incentive — if he immediately decamped to Goldman Sachs, it would confirm the creature-of–Wall Street image that dogged him while in office. But I suspect there is some real moral hesitation on Geithner’s part. If he had wanted to jump to Wall Street, he could have done so years ago, instead of working for the IMF and toiling away in the under-bowels of Treasury.
The revolving door has a way of bending morals, though, and it’s possible that Geithner may be made an offer he can’t refuse. There is always the “doing the right thing for my family” excuse to fall back on. But I’d be extremely surprised. As we learned during Geithner’s tenure in office, he’s slightly less predictable than his predecessors.