Is Goldman Sachs still feared and courted in the halls of power or is it “spurned”?
We get two opposite stories from The Wall Street Journal and The New York Times this morning on the firm (an Audit funder). Here’s the Times headline:
Goldman and Its Lobbyists Spurned in Finance Fight
And the WSJ:
Goldman Shows How It Can Still Lobby Hard
Somebody’s giving the wrong impression here, and it looks like it’s the Times, since it hedges its thesis nine ways to Sunday (emphasis mine)
Goldman Sachs employs perhaps the country’s most well-connected stable of Washington lobbyists, and it spent $2.8 million last year to bend the ear of federal officials and lawmakers. But the pounding the investment firm has taken in recent days has left it sidelined — at least in public — as Congress moves toward a decision that could reshape the very industry it rules.
And:
Still, the company is trying to find a way to influence the debate, even if it cannot play as visible a role.
Goldman Sachs declined to comment on Wednesday on the impact that its legal and public relations troubles have had on its Washington lobbying operations. But one person briefed on its plans, but who spoke on condition of anonymity because of the firm’s continuing legal and political troubles, said it was still trying to push its agenda.
Does anybody believe that folks in Congress are slamming the door in Dick Gephardt’s face, for instance? The former Democratic majority leader is now a bigtime lobbyist for Goldman—a “spectacular sellout,” as The Nation aptly put it. The Journal reports this other close tie to powerful Dems in Congress:
Goldman’s Washington operations are run by Michael Paese, a former aide to House Financial Services Committee Chairman Barney Frank (D., Mass.).
More centrally, even if the Times is correct that Goldman has been forced to use fronts like the American Bankers Association (it’s definitely incorrect, however, on its name, calling it the “American Banking Association” here) to lobby, it’s giving the wrong impression. Any company with $12 billion in profits last year isn’t going to be shut out of the halls of power. So the Times is lending credence to the “kabuki theatre” going on, as a WSJ source puts it:
“I don’t think political Kabuki theatre is having any impact on the ability to get meetings and be heard” in Congress, says a person familiar with Goldman’s strategy. “The point of the matter from their standpoint is they can be heard. … Nobody’s being treated like lepers.”
On a separate point, the Journal which focuses its story on Goldman’s aggressive lobbying to kill an amendment that would force it to spin off its derivatives business, has some interesting reporting on internal White House machinations:
The White House has been lukewarm on the section-106 provision. A source familiar with the White House’s deliberations said the president pulled back other administration officials who wanted to work to drop it.
“Other administration officials” like Larry Summer and Tim Geithner, presumably.
Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR’s business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.