March 18, 2013
Eugene Ludwig And Alan Blinder's For-Profit Bank Supervisor
Posted by David Zaring

I'm less exercised about the revolving door than most.  But this American Banker story on Promontory Financial, the lucrative place where retired regulators go to read the riot act to banks in crisis, in an effort to get them out of the jail that is CAMELS 5, is pretty interesting.  It has made Eugene Ludwig, the former Comptroller of the Currency. something like dynastic wealth, and it seems to afford other career bureaucrats, incuding Princeton economist (and Fed vice-chair) Alan Blinder, seven figure sums for post-retirement work.  

I don't have problems with either of those things, and Promontory really does seem to salt the private sector with consultants who expect compliance with regualtory edicts.  What does surprise me is that I can't think of a similar example of this particular sort of revolving door elsewhere, though one presumably exists for defense contractors.  Does EPA have a Promontory?  OSHA?  It might be that the money for "tell me how I can make this right with the FDIC" sort of advice exists in finance alone. HT: Counterparties

Administrative Law, Finance, Financial Crisis, Financial Institutions | Bookmark

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