"She (Mary Jo White) dropped out and made the move a lot of regulators make, leaving government to make bucket loads of money, working for the people she used to police." And I gather your great concern is that you don't want to see the country's top financial cop being indebted to the people who created the bank role?
MATT TAIBBI: Right. Yeah, absolutely. I mean, it's just simple common sense. I mean, you're sitting on $10 million, $15 million, however much money she made working there at Debevoise and Plimpton when she was a partner and you owe that money to this specific group of clients and now you're in charge of policing them, just psychologically think of that. It doesn't really work, you know? It doesn't really work in terms of how aggressive a prosecutor should be, what his attitude towards the people he's supposed to be policing should be. It's just, the circumstances just aren't quite right. You'd much rather see a career civil servant in that in that situation.
BILL MOYERS: She was once a tough prosecutor. What's your beef?
MATT TAIBBI: Well, you know, I have people who are telling me that I'm wrong about this, that Mary Jo White was an excellent prosecutor and she's a good choice. But, you know I've done stories in the past about an episode, you had an SEC investigator named Gary Aguirre who was pursing an insider trading case against the future CEO of Morgan Stanley. He asked for permission to interview that future CEO. His name was John Mack. It was denied. And it was because there was communication between Morgan Stanley's lawyer, who at the time was Mary Jo White and the higher ups at the SEC who included the director of enforcement, Linda Thomsen. Aguirre was later fired for complaining about having this investigation squelched.
BILL MOYERS: Blowing the whistle.
MATT TAIBBI: For blowing the whistle. But the SEC was later forced to pay a $750,000 wrongful termination suit to Aguirre in that case. But what's so interesting is that Aguirre's boss, the guy who killed that case went to work for Mary Jo White's firm nine months after the case died. And he got, you know, a multi-million dollar position. It's a classic example of how the revolving door works in Washington. You know, you have these regulators at the SEC. And they know that there's that job out there waiting for them. So how hard are they really going to regulate these companies when they know they can get that money?
But in Washington, you know, people kind of shake their heads at it because it's so common you know, that these people, they move from government back to, you know, these high priced legal defense firms that represent the banks. And then they go back to government again. And it's this sort of, this coterie of, you know, 100, 200 lawyers who really run this entire thing. And it's all the same people on both sides.
BILL MOYERS: Lanny Breuer was one of them. He was in a very prestigious Washington law firm. Jack Lew, the new incoming secretary of the Treasury if he gets approved, served three years at Citigroup. His record there, according to “The Wall Street Journal” was not very lustrous for a man who's about to take over the Treasury Department. But “The Wall Street Journal” suggests that he got his job, not because he had the experience, but because he was a crony of Robert Rubin.
MATT TAIBBI: Jack Lew served in the Clinton administration. I think he worked in the OMB in the, you know, Office of Management of the Budget. And he was one of the key players in helping pass the repeal of Glass-Steagall. And, you know, this is kind of the way it works. It's not a one to one, you know, obvious connection. But, you know, Glass-Steagall was repealed specifically to legalize the merger of Citi Group. And, you know, coincidentally Bob Rubin, who was the Treasury secretary and Jack Lew end up working at Citi Group five, ten years later. And they make enormous amounts of money. And then they go back to government. And again, this is just sort of this merry-go-round that everybody in Washington knows about. And that's the way it works.