Washington Babylon — November 28, 2008, 11:51 am

Summers and Hedge Funds

After being named as Barack Obama’s top White House economics adviser, Lawrence Summers resigned from his post as a managing director of D.E. Shaw & Co, a leading hedge fund. “Neither the Obama transition team nor D.E. Shaw would say exactly what Summers had done in his two years of work for the $36 billion hedge fund, or how much he has been paid, Politico reports. A 2007 article in Institutional Investor’s Alpha says only that Summers was hired to work “with the senior management team to ?nd new ways to generate pro?t and manage risk.”

D.E. Shaw is a member of the Managed Funds Association, the leading lobbying organization for the hedge fund industry. The MFA was founded last year and since then has spent about $3.5 million lobbying the federal government, according to federal disclosure records. Its priorities include blocking regulation of hedge funds and financial instruments like derivatives. The MFA also opposes higher taxes on hedge funds and their managers. Incidentally, David E. Shaw, the founder of Summers’ recent employer, earned about $210 million last year.

Top lobbyists at the MFA include former Louisiana Congressman Richard Baker, previously of the House Financial Services Committee, and Roger Hollingsworth, who was hired in August. Hollingsworth was hired from the Senate Banking Committee, where he served as deputy staff director and senior policy advisor to Committee Chairman Christopher J. Dodd,” says his bio. (Hollingsworth is a one-man revolving door. Before going to work for Dodd, he lobbied for the Securities Industry
Association, and before that he worked for Democratic senators Jon Corzine and Charles Schumer.)

The MFA spent a few million more on lobbyists from eight outside firms it retained. The roll call of former officials working for the association include, at one firm alone, Senator Don Nickles; Rachel Jones Hensler, tax policy director for the Budget Committee under Nickles; Hazen Marshall, staff director for the Senate Budget Committee; and Brian Wild, a former top aide to Vice President Dick Cheney. The list goes on and on.

The MFA and people affiliated with it donate lavishly to politicians as well, overwhelmingly to Democrats. Trey Beck, the managing director of D.E. Shaw who helped hire Summers and who is also a board member of the MFA, gave more than $40,000 to the Democratic Senatorial Campaign Committee in recent years (not to mention $2,200 to Moveon.org in 2004).

“As citizens, we’re delighted that President-elect Barack Obama has selected Larry Summers to head the National Economic Council,” D.E. Shaw said in a newly released statement.

The MFA is surely delighted as well.

Share
Single Page

More from Ken Silverstein:

Commentary November 17, 2015, 6:41 pm

Shaky Foundations

The Clintons’ so-called charitable enterprise has served as a vehicle to launder money and to enrich family friends.

From the November 2013 issue

Dirty South

The foul legacy of Louisiana oil

Perspective October 23, 2013, 8:00 am

On Brining and Dining

How pro-oil Louisiana politicians have shaped American environmental policy

Get access to 165 years of
Harper’s for only $45.99

United States Canada

CATEGORIES

THE CURRENT ISSUE

February 2016

Isn’t It Romantic?

= Subscribers only.
Sign in here.
Subscribe here.

The Trusted Traveler

= Subscribers only.
Sign in here.
Subscribe here.

The Trouble with Iowa

The Queen and I

Disunified Front

= Subscribers only.
Sign in here.
Subscribe here.

We Don’t Have Rights, But We Are Alive

= Subscribers only.
Sign in here.
Subscribe here.

view Table Content

FEATURED ON HARPERS.ORG

Article
Isn’t It Romantic?·

= Subscribers only.
Sign in here.
Subscribe here.

“He had paid for much of her schooling, something he cannot help but mention, since the aftermath of any failed relationship brings an ungenerous and impossible impulse to claw back one’s misspent resources.”
Illustration by Shonagh Rae
Article
The Trouble with Iowa·

= Subscribers only.
Sign in here.
Subscribe here.

“It seems to defy reason that this anachronistic farm state — a demographic outlier, with no major cities and just 3 million people, nine out of ten of them white — should play such an outsized role in American politics.”
Photograph (detail) © Justin Sullivan/Getty Images
Article
Rule, Britannica·

= Subscribers only.
Sign in here.
Subscribe here.

“This is the strange magic of an arrangement of all the world’s knowledge in alphabetical order: any search for anything passes through things that have nothing in common with it but an initial letter.”
Artwork by Brian Dettmer. Courtesy the artist and P.P.O.W., New York City.
Article
The Queen and I·

= Subscribers only.
Sign in here.
Subscribe here.

“Buckingham Palace is a theater in need of renovation. There is something pathetic about a fiercely vacuumed throne room. The plants are tired. Plastic is nailed to walls and mirrors. The ballroom is set for a ghostly banquet. Everyone is whispering, for we are in a mad kind of church. A child weeps.”
Photograph (detail) © Martin Parr/Magnum Photos
Article
We Don’t Have Rights, But We Are Alive·

= Subscribers only.
Sign in here.
Subscribe here.

“If I really wanted to learn about the Islamic State, Hassan told me, I ought to speak to his friend Samir, a young gay soldier in the Syrian Army who’d been fighting jihadis intermittently for the past four years.”
Photograph (detail) by Anwar Amro/AFP/Getty

Amount by which the number of government jobs in the U.S. exceeds the number of manufacturing jobs:

5,129,000

The sound of mice being clicked may induce seizures in house cats.

In Turlock, California, nearly 3,500 samples of bull semen were stolen from the back of a truck.

Subscribe to the Weekly Review newsletter. Don’t worry, we won’t sell your email address!

HARPER’S FINEST

Two Christmas Mornings of the Great War

By

Civilization masks us with a screen, from ourselves and from one another, with thin depth of unreality. We habitually live — do we not? — in a world self-created, half established, of false values arbitrarily upheld, largely inspired by misconception, misapprehension, wrong perspective, and defective proportion, misapplication.

Subscribe Today