As letterhead hires go, private-equity firm KKR’s decision to rescue four-star general David Petraeus from the scandal-marred end of his political career by hiring him to lead up a new “KKR Global Institute” is one of the most puzzling cases.
It’s not uncommon, of course, for a Wall Street firm to bring a famous former politician in from the cold with a ceremonial title and a seven-figure salary. (Think Dan Quayle, Evan Bayh, Vernon Jordan.) But usually, those politicos have at least some tenuous connection to the world of finance — legislation they’ve contributed to, committees they’ve sat on, maybe a law degree or an MBA in their past. In the case of Petraeus — who has never held a private-sector job, to my knowledge — his only qualifying résumé line seems to have been a lucky friendship with KKR co-founder Henry Kravis.
When Bloomberg broke the news last month about Petraeus’s possible move to KKR, it was clear that Kravis — who apparently befriended Petraeus “at dinner parties, conferences and as a member of the Council on Foreign Relations” over the past few years — hadn’t yet thought of what to do with Petraeus, but badly wanted to hire him for something. That something turned out to be a Global Institute that will “bring together Mr. Petraeus and others at the firm to formalize discussions over macroeconomic and geopolitical forces that could influence KKR’s investment decisions,” according to the Journal.
I suppose it is theoretically possible that some bit of wisdom gained over the course of Petraeus’s long and distinguished military career could help KKR figure out whether to merge Saks and Neiman Marcus, or invest in Asian real estate, or buy a piece of Hulu, or any of the other deals KKR works on. But despite the firm’s promises that Petraeus will be deeply involved in helping “perform due diligence on deals,” it seems most likely that the former CIA director’s main task will be organizing a bunch of tremendously boring meetings:
The KKR Global Institute, as the private-equity firm has dubbed it, will bring together Mr. Petraeus and others at the firm to formalize discussions over macroeconomic and geopolitical forces that could influence KKR’s investment decisions. These issues include the heightened role of central banks following the financial crisis, and what KKR views as “revolutions” in energy, manufacturing and technology, among other areas.
I’m not mad at KKR for hiring Petraeus, nor do I fault Petraeus for accepting the offer. Every veteran of our armed services should have the chance to cash out in such a spectacular fashion. And Kravis’s willingness to stand by Petraeus, while the general is still under investigation for having an affair with his biographer, fits a certain definition of old-school nobility. Plus, the two are already making delightfully awkward videos together. What’s not to like?
