Good government groups took swings this weekend at Larry Summers, along with the White House in general, after it was revealed that the economic adviser accepted hundreds of thousands of dollars in speaking fees from banks dependent on taxpayer funds.
Calling the revelations yet another strand in a "web of connections between Wall Street and Washington," David Donnelly, the director of Campaign Money Watch, said news of Summers' finances contributed to the "strangling [of] public trust in all the decisions made by the Administration or Congress on the economy."
"Most of the companies paying Summers' speaking fees are found at top the list of contributors to politicians from both parties, leaving voters to wonder if there is anyone left who isn't in Wall Street's pocket," Donnelly added. "One major step that Congress ought to take immediately is to remove all questions that their future decisions are the result of favoritism for political contributors by passing the bipartisan Fair Elections Now Act."
On Friday afternoon, the Obama White House released personal financial disclosure forms for members of the executive office. The one for Summers proved particularly politically problematic. The chief economic adviser to the president had, over the past year, received lavish fees for speaking arrangements from a host of banks involved in the government's asset relief and recovery programs. The list included $67,500 from J.P. Morgan Chase, $99,000 from Citigroup, and $202,000 from Goldman Sachs.
Ben LaBolt, a spokesman for the White House, said in a statement on Friday, "Dr. Summers has been at the forefront of this administration's work to shore up our nation's financial system and to put in place a regulatory framework that will strengthen the financial system and its oversight." A White House official, meanwhile, said that the "speeches long pre-date Summers' work as an official of the Obama Administration or even the Obama transition."
All of which was noted by good-government officials, who nevertheless found the revelations eyebrow-raising, both because of the pass Summers was seemingly offered and the message it sends about the administration's priorities.
"The fact that he wasn't a government official at the time makes it much less gross to me," said Danielle Brian, executive director of Project on Government Oversight. "But I do find it the height of irony that he could take hundreds of thousands of dollars last year from companies that were known to be tanking our economy, and still be appointed to one of the key economics positions in the government. And the new Chief of Staff of FEMA turns out to have been a former executive from a Katrina contractor for FEMA. But at the same time we're learning about people like Pam Gilbert, who had registered to represent consumer interests before the [Consumer Product Safety Commission], but then never did lobby them, yet that was too tainting for her to be allowed into the Administration. It sounds like they have things kind of backwards. If President Obama wants to rid Washington of corporate influence, I think these issues need to be a little better thought out."
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