WASHINGTON — In the heat of the presidential campaign, Donald Trump accused primary rival Ted Cruz of being controlled by Goldman Sachs because his wife, Heidi, previously worked for the Wall Street giant. He slammed Hillary Clinton for receiving speaking fees from the bank.
“I know the guys at Goldman Sachs. They have total, total control over him,” Trump said of Cruz. “Just like they have total control over Hillary Clinton.”
Now, Trump is putting Goldman executives at the helm of his administration’s economic team. He’s expected to name bank president Gary Cohn to an influential White House policy post, according to two people informed of the decision, and has already nominated former Goldman executive Steve Mnuchin to lead the Treasury Department. Steve Bannon, Trump’s incoming White House senior adviser, also worked at Goldman before becoming a conservative media executive.
Wall Street executives have long wielded influence in Washington, filling top jobs in both Republican and Democratic administrations. Goldman Sachs itself has produced several Treasury secretaries, White House chiefs of staff and top economic advisers.
But the financial industry’s high-level presence in Trump’s burgeoning administration runs counter to some core campaign messages that energized his supporters.
Trump repeatedly warned that Clinton’s Wall Street ties — the Democrat gave paid speeches to Goldman and other banks — meant she would never reform the financial industry. He promised that he would “drain the swamp” in Washington, a city he painted as beholden to financial and political special interests. And he cast himself as a champion for working-class people who watched the big banks grow wealthier after a government bailout, but haven’t seen the effects of an improving economy in their own lives.
“I’m not going to let Wall Street get away with murder,” Trump told voters in Iowa. “Wall Street has caused tremendous problems for us.”
To Democrats, the fact that Trump is now plucking advisers from Wall Street smacks of hypocrisy.
“Everyone who voted for Trump, who thought he’d defend working people, pay attention to the reality of what he’s doing, not just his rhetoric,” said Vermont Sen. Bernie Sanders, who railed against Wall Street’s influence in Washington when he ran against Clinton in the Democratic primary.
The concentration of power among so many players who once worked at Goldman is sure to feed suspicions of a government at the service of Wall Street. Goldman was involved in the securities market for subprime mortgages, the same financial instruments that helped fuel the housing bubble and ultimately led millions of Americans to lose their homes to foreclosure. Wall Street executives also opposed the Dodd-Frank financial reform legislation signed by President Barack Obama, legislation Trump has vowed to overhaul.
Trump’s advisers dismiss charges that the president-elect is going back on his promises to put the interests of working-class Americans ahead of financial institutions. They say Trump is tapping people who bring real-world experience and business acumen to Washington.
“You’re not going to find better people than those who have been at the top of finance, the top of our markets, understand the way our markets work,” Kellyanne Conway, Trump’s senior adviser, said on MSNBC.
Democrats are sure to make an issue of Mnuchin’s Wall Street ties in his confirmation hearing. Cohn doesn’t need to be confirmed in order to serve as director of the National Economic Council, the White House post Trump is expected to name him to.
The NEC helps coordinate domestic and global issues, providing economic policy advice to the president and monitoring how the White House’s agenda is implemented across the government. If Cohn accepts the job, he also will be the third Goldman executive to run the NEC. Robert Rubin was the NEC director under Bill Clinton, and Stephen Friedman had the job during George W. Bush’s administration
Goldman Sachs stocks are up 33 percent since Trump’s election.