Mary Jo White Ever Corporate Clients’ Friend

Mary Jo WhiteMary Jo White, whose tenure as chair of the Securities and Exchange Commission under President Obama bitterly disappointed those who hoped she would aggressively enforce banking laws, is rejoining the corporate defense team at Debevoise & Plimpton, marking her sixth trip through the revolving door between various government jobs and the white-collar defense law firm she calls home.

Debevoise represents numerous major financial institutions under federal investigation, and White will now help those corporate clients manage their legal exposure.

White got the call to return to Debevoise on Inauguration Day, her last day at the SEC. As Debevoise presiding partner Michael Blair told the Wall Street Journal, “We had been waiting to make that phone call for several years.”

This latest trip through the revolving door is particularly disturbing because White declared in ethics disclosure forms before becoming SEC chair that she was retiring from her partnership at Debevoise, receiving a lump sum retirement payment of over $2 million. Instead of staying retired, she immediately went back to Debevoise after her government service ended, pocketing the money.

It is not, however, surprising…

Under White, the SEC failed to monitor stock buybacks to prevent market manipulation. It failed to stop the epidemic of granting waivers to companies automatically banned from securities activities after settling cases of civil and criminal wrongdoing. White stood with Republican commissioners even as Democratic colleagues tried to stop those waivers from being granted. In a troubling continuance of regulatory capture at the agency, White hired a senior Goldman Sachs attorney as the SEC chief of staff.

Though White made a big show of fighting to force companies to admit guilt in any settlement, a break from past practice, in reality this tool was rarely used. According to a letter from Senator Elizabeth Warren, of 520 settlements from June 2013 to September 2014, only 19 required admissions of guilt. And in the majority of those cases, the SEC only asked for a broad admission of the facts of the case, rather than admissions of specific securities violations. In one example, the SEC got JPMorgan Chase to admit to breaking a law in 2013, but it wouldn’t say which one.

–David Dayen
A Corporate Defender at Heart, Former Sec Chair Mary Jo White Returns to Her Happy Place

See Also:

01 January 2013: Mary Jo White: Business As Usual
24 June 2013: Good Change at SEC — Maybe
05 June 2015: Mary Jo White Is Doing Obama’s Will: Nothing

6 thoughts on “Mary Jo White Ever Corporate Clients’ Friend

    • Frank’s argument isn’t against “smart guys” though; it is against carbon copies. As he noted in Listen, Liberal! FDR surrounded himself with smart guys. But they didn’t all go to the same schools; they weren’t all part of the same social class with the same backgrounds.

      And I take exception that these are smart people. As Salutin points out, “Historically, the truly smart, starting with Socrates, know they don’t know much.” But it isn’t so much that they didn’t know much; it was that they knew what they knew. Today, we have a bunch of people who suffer from more hubris than the people who built the Tower of Babel. But there is nothing to worry about, because we don’t need God; we’ve created our own gods out of the rich. And we define them as smart. That’s what it is to be smart in America: rich. Because power is all the matters. It is the only good.

      There’s a good line A Thousand Clowns (said sarcastically, but I’ve come to see it as true), “If you’re so smart, why aren’t you poor?”

      • Right, so much right. My favorite line of the entire New Deal came from Marriner Eccles, the Fed chairman appointed by FDR. The Fed building is named after him, now. Eccles was a owner of a tiny bank in Utah. He went to what was, essentially, a community college. He told Congress during the Depression: “We shall either adopt a plan which will meet this situation under capitalism, or a plan will be adopted for us which will operate without capitalism.”

        No dummy, that guy.

        I could live with white-collar people thinking money & career status define an individual’s moral/intellectual value. After all, they always have. What’s tragic, and may be incredibly difficult to undo, is now significant numbers of blue-collar people believe it, too.

        When the circus peanut’s TV show first came on, I showed up at work, and the worker I was relieving pointed in my face and said, “you’re fired.” I was completely panicked. Why hadn’t my supervisor informed me? What had I done wrong? Did I give someone food poisoning? Was somebody in the hospital because I forgot a medication?

        No, of course not. The co-worker was just being friendly, repeating the catch phrase du jour. Like “where’s the beef?” When she explained what the phrase was, I thanked her for clarifying the reference. Silently, to myself, I first wondered “why is this 80s cartoon back on TV?” Then I realized millions of people like my coworker thought he was a tough, brilliant man. And I worried that this was a very, very bad sign.

        You’ve written how “Shark Tank” is basically the same thing.

        Salutin is not profound. Why I love him is, he’s hopeful. He’s a very old newspaper guy, and nobody’s fool. Yet age gives him a perspective I wish I had. Things can turn out better than you expect. But it takes a long time. Stick up for what’s right, don’t buy into what’s wrong, and people can surprise you.

        To steal from Arthur Clarke, if an old, world-wise journalist says “don’t give up hope,” they’re probably right.

      • Last rant, on carbon copies. Remember Yanosuke Hirai, that heroic engineer who fought against idiots for higher nuclear plant safety standards? The Guardian had a piece on how cleanup at the melted plant, Fukushima, is going:

        The latest estimate is it’ll take 40 years and $200 billion dollars. Billion. With a B. Humans can’t go anywhere near the melted goop. Robots can, and their circuits get fried in two hours. God only knows what kind of increased cancer rates will show up in people who had to flee the town.

        Carbon copies are the worst. What’s crazy is all our VSP insist that “the market” is better than government regulation, because “the market” allows for ideas to succeed or fail. Supposedly letting the best ideas flourish. It’s balderdash, but let’s grant it for the sake of argument.

        They’ve all, every last “my taxicab driver told me” one of them, been carbon copies chanting in unison for 40 years! And their ideas have failed! Authoritarianism is rising all over the world! This does not bode well! And yet they keep insisting, as a chorus, “don’t mess with the holy market.”

        It wuz you, Friedman! It wuz you!

  1. There are some assumptions that Trump, Ryan, Obama, Clinton all share: money equals intelligence, inequality just sort of happened and any attempt to change that fact will anger the God that is the free market.

    To be fair to establishment Democrats, they did not abandon the working class in one fell swoop. Republicans pulled working class whites, especially white guys, into the Republican coalition piece by piece (mostly with appeals to white supremacy). Democrats felt like they needed to lean on minorities and white professionals, who are culturally liberal, in order to win. The Democratic Party gets more donations from big business since social liberalism doesn’t cost big business much money. This pushes more working class people, who are white into the GOP coalition. This feedback loop is further accelerated by the fact that white members of the professional class are increasingly clustering into high rent cities along with minorities and LGBTQ people which creates a discernible, geographically based Democratic coalition. Suburban and rural white workers feel even more alienated and get even more invested in tribal, conservative politics.

    To further solidify the divide, Democrats have declared white guys without colleges degrees to be losers who deserve whatever misfortune befalls them. At the same time, white people in red Counties have less and less access to higher education and they now have assumed adaptive preferences and decided that higher education is actually a bad thing. Once more, conservatives are now hostile to all knowledge that they do not like.

    So we increasingly are becoming the stereotype that the opposition imagines. The median Democrat really is becoming an elitist, hipsters who lives in the big city and hates the working class. The median Republican is increasingly becoming that hick that despise all trapping of modernity and inclusiveness.

    We are stuck in a disheartening feed back loop which is fueled by white supremacy and the plutocratic donor class in both major political parties.

    • You’re exactly right, I think. You pretty much summed it up nicely. I don’t think the Democratic Party acted out of bad faith; I believe they ran with a plan, which has proven to be disastrous. Everybody makes mistakes. It’s time to admit Democratic strategy for the last 25+ years has been a horrific mistake, and change directions. For the good of the country. And, of lesser importance, for the good of the party, which is getting slaughtered at the state level.

      The one thing I’ll add to your assessment is the Democrats’ recent fixation on education as the cure for all ills. Since Clinton, they’ve focused, not on making life better for working people, but on increasing access to college. So more people would find their way into the professional class.

      And now jobs in the professional class have metasticized. Offices have so many useless positions with so many useless duties, workers sit around on antisocial media half the day. Despite this horrid growth in corporate bureaucracy, there aren’t enough office jobs to fit all the college graduates today. Hence the cliche of a Business Administration graduate pouring coffee at Starbucks.

      Some in the party believe it is heresy, and an insult to those who came before, if anyone suggests this strategy has not succeeded. I respectfully disagree. I see fascism on the rise worldwide, and I directly blame policies which benefit the professional classes. And I think if we don’t turn away from that, we’re going to be in big trouble.

      We’ve done it before. As much as the world loathes America’s military cruelty, they still admire us. They admire how hard our civil rights movement fought, and at such cost. They admire how hard our labor movement fought, and at such cost. (May 1, everywhere else in the world, is Labor Day. It commemorates the murder of labor leaders in Chicago. Here, that story is forgotten.)

      I’m proud of that American history. And I want to be proud again.

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