Yet another would-be Treasury nominee has bitten the dust. This time it’s Rodgin Cohen, a partner at Sullivan & Cromwell. Cohen was to be Deputy Treasury Secretary, but withdrew at the last minute because of “an issue that arose in the final stages of the vetting process.”
It’s possible that Cohen didn’t pay his taxes, but I’m guessing they get to that before the final stages these days. Obama’s original pick for the Deputy Secretary position was Elizabeth Nazareth, but she withdrew because some Senators were unhappy with the fact that she was at the SEC until recently, part of the enforcement effort that failed to catch Bernie Madoff and others. Perhaps something similar was going on with Cohen. He didn’t work for the SEC, but he had many Wall Street clients and, as noted below, was involved as a lawyer in transactions that the Democrats may now want to criticize–or demonize. Maybe political objections were made to him as well.
For those not familiar with such things, Sullivan & Cromwell is as good as it gets in the legal world, and Cohen is chairman of that firm. His web page is here. His career has largely involved representing banks, including in regulatory matters. Since the financial crisis began, he has had many high-profile engagements on behalf of banks. From his web page:
Recent press stories attest to the preeminent stature of Mr. Cohen in the financial institutions sector:
“With virtually all of Wall Street as his client, [Cohen] has solidified his role as one of the most influential private-sector players in the financial crisis. Over the past five weeks alone, Mr. Cohen and his team have advised Fannie Mae, Lehman Brothers Holdings Inc., Wachovia, Barclays PLC, American International Group Inc., J.P. Morgan Chase & Co. and Goldman Sachs Group Inc. in a blitz of mergers, rescues and cash infusions.” (The Wall Street Journal, October 9, 2008)
So maybe Obama’s people decided that Cohen has had too much involvement in the current financial crisis on behalf of private sector clients to be pristine–or, as suggested above, to fit in with the politically-motivated narrative that Obama and other Democrats want to tell. But the guy is obviously as good as they come. If he is willing to serve in the administration for a tiny fraction of the income he is now earning, Obama shouldn’t let politics stand in the way of bringing him on board.
This is speculation, of course; we don’t yet know exactly why Cohen withdrew, and may never find out. But on any interpretation, Obama’s failure to staff the Treasury Department at this moment in history is troubling.