Goldman Sachs' (GS) ties to the Obama Administration are two fold. Financial contributions to Federal Government organizations and U.S. politicians of both parties is the first hand of Goldman Sachs ' business in the affairs of Washington D.C. The second hand is Goldman Sach's many former employees who hold, and have held rather telling positions in the government.
The facts that demonstrate Goldman Sachs is tied to the Obama administration are evident in the statistics of the watch dog group www.opensecrets.org.(4) At the top of the 2008 recipients list was Barak Obama followed by Hillary Clinton who jointly received over $1.4 million from Goldman Sachs. In the 2010 cycle, and as of record on 4/23/2010, Michael E. McMahon, a House of Representatives member is the top recipient of Goldman Sachs funds. McMahon is also a sponsor of the Derivative Trading Accountability and Disclosure Act (H.R. 3300)
Of the Obama administration's employee links to Goldman Sachs are 4 former Goldman Sachs payroll recipients. The 'World Socialist Website' reports these Obama administration representatives to all be affiliated with the U.S. Treasury or U.S. Economic affairs. Specifically, wsws.org lists these people as being Mark Patterson, Jeffery Reuben III, Neel Kashkari, and Diana Farrell. All these individuals were instrumental in the financial decision making surrounding the federal bailout of Wall Street firms of which Goldman Sachs was a major recipient.(5)
The ties between Goldman Sachs (GS) and the U.S. Federal Government aren't really a new thing, as the relationship goes back several administrations. The ties between Goldman Sachs and the Obama administration isn't a one way one either. Former Government officials can also work for Goldman Sachs. One such example being Gregory Craig, former Obama White House Council according to Greg Gordon of McLatchy newspapers. This lawyer has allegedly been hired by Goldman Sachs to assist with the charges held against it by the Securities and Exchange Commission (SEC).
Of previous administrations' links to Goldman Sachs is Henry Paulson, who has not been linked to the hedge fund the SEC claims is fraudulent, and is the former U.S. Secretary of the Treasury as well as former executive of Goldman Sachs. In regard to the SEC case, its detailed are outlined by a Reuters report of Charles Whitehead of Cornell University Law School who states John Paulson, a hedge fund manager, may not have had a fraudulent conflict of interest with clients because independent responsibility for the hedge fund is also held by an organization called the ACA Capital Management Group. (3) In other words, the defrauding if any, was fault of ACA and not Goldman Sachs.
Other former Government officials who help positions at Goldman Sachs include Robert Rubin, the secretary of the Treasury during the Clinton administration was also a Goldman Sachs employee. The list doesn't begin or start with the Secretaries of the Treasury, it also includes several former high level U.S. Federal officials who have been affiliated with Goldman Sachs. Investopedia.com reminds us of these people, specifically William Dudley, Stephen Friedman, John Whitehead, John Corzine and Josh Bolton. (2) All these persons collectively worked an average of 23 years at Goldman Sachs, three of whom served for Federal or State Federal Reserve Banks and the roll doesn't end there. 'The Classic Liberal' website provides over 30 names of former Goldman Sachs associates that have also been tied to the White House. (6)
Whether or not the SEC's charges and the White House's connection to Goldman Sachs are related and serve some political end is a matter of speculation. What is evident is the fact the Obama administration and the previous administration is, and was indeed linked to Goldman Sachs. After the SEC made public its charge against Goldman Sachs (GS), the firm's common stock price declined sharply from over $180 to under $160 despite positive Q1 2010 earnings that beat analysts estimates.
Sources:
1. http://online.wsj.com/article/SB123897383937190973.html
2. http://tinyurl.com/4yay4qs (Financial Edge: Investopedia)
3. http://blogs.reuters.com/great-debate/2010/04/23/shorting-the-secs-case-against-goldman-sachs/
4. http://www.opensecrets.org/orgs/toprecips.php?id=D000000085&type=P&sort=A&cycle=2008
5. http://www.wsws.org/articles/2009/jul2009/gold-j15.shtml
6. http://the-classic-liberal.com/white-goldman-sachs-house/
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