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From Wall St. To Washington: Famous Moments In Revolving Door History

First Posted: 01/11/2012 6:10 pm   Updated: 01/11/2012 6:23 pm

Want to get to Washington? Try going through Wall Street. As a look at any recent presidential administration will show, people move between the two worlds all the time.

Earlier this week, President Obama announced that budget director Jack Lew would be taking over as his chief of staff, assuming the title from the outgoing Bill Daley. Both men have previously worked at major financial firms -- Lew at Citigroup, Daley at JPMorgan Chase -- meaning that Lew's promotion continues a long-running trend of business executives moving into positions of power in the nation's capital.

Obama's decision to replace one with the other has left critics wondering if the administration can be trusted to regulate the business community when so many White House staffers have spent time on Wall Street. The question is especially pressing today, as Americans everywhere continue to grapple with the effects of a financial crisis that might not have unfolded in such disastrous fashion if the government had kept a closer eye on big banks.

In spite of the potential for conflicts of interest, crossover between the world of finance and the world of politics is nothing new. Even before Obama teamed up with onetime investment banker Rahm Emanuel, George W. Bush entrusted Henry Paulson, a 22-year veteran of Goldman Sachs, with the keys to the Treasury. And as seen with Peter Orszag and Robert Rubin, the migrations happen in both directions, with almost as many D.C. insiders leaving for a position in finance as vice versa.

Here are some of the most notable examples of Wall Street players who went to Washington, or the other way around:

Jack Lew
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Jack Lew, whom President Obama named as his new chief of staff this week, worked at Citigroup between 2006 and 2009. While there, he served as the chief operating officer of Citi's Alternative Investments unit, a division that oversaw the same kind of proprietary trading activity that the so-called Volcker Rule would later attempt to curtail. At one point, Lew's unit invested millions in a fund run by hedge fund manager John Paulson, who made his fortune speculating on the collapse of the housing market. Later, during his confirmation hearing to lead the Cabinet-level Office of Management and Budget, Lew told a Senate panel that he didn't "believe that deregulation was the proximate cause" of the financial crisis.
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Filed by Alexander Eichler  |