Liz Warren’s revolving door with Wall Street

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There was an interesting development in the world of big government and big business recently. Sen. Elizabeth Warren (D-MA) declared that “The abuse of the revolving door is appalling,” specifically in reference to her crusade against cryptocurrency firms and their apparently unacceptable practice of hiring former government officials as lobbyists.

Her general point is fairly common; that is, that people who make their careers in law and government often end up working for the same for-profit companies that they previously regulated and enforced the law against, and that this is an invitation to corruption. If that is true, however, Warren and her friends are some of the worst offenders. 

As reported by Fox Business’ Eleanor Terrett, there is a long history of alumni from the Obama White House, Warren’s Senate office, and Warren’s favorite federal agency, the Consumer Financial Protection Bureau, being more than happy to move on from their government jobs and cash in by working for big Wall Street firms like BlackRock, the world’s largest asset management firm.

When the revolving door turned again, however, and some of those same Obama-era officials decided to come back to policymaking roles as part of the Biden White House in 2020, some skeptics of corporate power in the Democratic political world balked. They would have preferred a complete ban on corporate nominees.

Critics of the progressive-left version of the revolving door, however, were told that it was just fine that people like Brian Deese and Wally Adeyemo, former Democratic staffers who then worked at corporate behemoth BlackRock, were coming back into the White House to work in finance policy, because neither had worked at BlackRock long enough to have gone native and “adopted the firm’s views on financial regulation.”

That may have satisfied enough Biden allies and Democratic Party activists to get them to lower their voices, but it ironically puts BlackRock itself in an awkward position. Because either Warren’s office actually is operating the exact same revolving door with Wall Street she claims to hate, or big money managers like BlackRock are paying left-wing policymakers who hate them millions of dollars to come in, learn their operations, and use that information as ammunition against them at a later date. Or, in some incoherent way, a little of both?

If the Biden administration’s defense is true and the people BlackRock was paying as executives disagreed with the firm’s policy and lobbying goals, why would they be made senior executives? What possible advantage would accrue to BlackRock clients and shareholders to have pro-regulation Democratic party activists in the mold of Elizabeth Warren herself in the room when the firm is making long-term strategic decisions? Perhaps because BlackRock simply expects to use their influence in a corporatist way to shape new regulation in their own favor, rather than standing up for the economic freedom of regular Americans. That may explain some of the tsunami of anti-BlackRock activism from the right in recent years.

Either way, Warren’s alleged anti-crypto accusations about revolving door politics should fall on deaf ears.