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Is former U.S. Treasury Secretary Robert Rubin unqualified to offer life advice now?
From:
Patrick Asare -- Author of 'The Boy from Boadua' Patrick Asare -- Author of 'The Boy from Boadua'
For Immediate Release:
Dateline: Wyomissing, PA
Friday, January 31, 2025

 

I recently read an article in the New York Times written by former U.S. Treasury Secretary Robert Rubin. In it, Mr. Rubin talked briefly about his time as co-head of the investment banking giant Goldman Sachs in the early 1990s, and the advice he used to give to young people who asked him for one. According to him, he routinely offered this: “First, become really good at what you do, and then branch out to get involved in activities and issues in the wider world beyond your work.”

Highly successful people like Mr. Rubin are frequently asked to speak at university commencement ceremonies. While the themes of such speeches may vary widely, service to one’s community and the world is something that pretty much every speaker recommends to graduating students. Thus, there was nothing controversial about the words of wisdom that Mr. Rubin mentioned.

After reading the article, I browsed the first few reader comments and was quite taken aback by the vitriol. I spent another half an hour reading several more, and they got progressively worse. The general tone of the commentaries suggested that Mr. Rubin lacks legitimacy to offer such counsel to anyone. People complained about some of his past actions that, apparently, disqualify him from providing that sage advice. The “sins” referred to were mostly committed during and after his time in public office. Three stood out in particular. The first was Secretary Rubin’s strong opposition in 1998 to regulation of over-the-counter credit derivatives markets. That, the critics pointed out, led to the lack of oversight on the use of credit derivatives that was later widely seen as one of the leading causes of the 2007-2008 global financial crisis.

Second, readers were extremely unhappy about the role Secretary Rubin played in the repeal of the Glass-Steagall Act. Enacted in 1933, the statute mandated separation of commercial banking from investment banking activities. It prohibited commercial banks from diverting funds into speculative activities. Secretary Rubin considered the act obsolete, and argued in favor of abolishing it. It was subsequently repealed by the Gramm-Leach-Bliley Act, which was signed by President Bill Clinton in 1999.

Some of the harshest comments focused on Mr. Rubin’s activities after he left his post as Treasury Secretary. In October 1999, he joined Citigroup, another Wall Street investment banking giant, as a senior executive on the company’s board. One of Citigroup’s major clients at the time was Enron, the scandal-ridden energy company that later imploded. Some of Mr. Rubin’s interventions on behalf of the company have since been widely criticized. Readers appeared to be most upset about Mr. Rubin’s reported compensation of over $120 million during his ten-year tenure at Citigroup.

I watched Mr. Rubin quite closely when he served in the Clinton administration. I was always impressed by his thoughtfulness and how he carried himself generally. In hindsight, certain policies he championed ended up doing some amount of harm. And most likely, he acknowledges some of them. But, looking at the totality of his public service, Mr. Rubin made a lot of positive contributions to this country. He advocated for both fiscal discipline and public investment, and was one of the architects of the economic plan that helped swing the federal budget deficit into surplus during Bill Clinton’s presidency.

America’s rapidly rising federal debt has become a ticking time bomb. Alarm bells have been ringing for several years but no one in Washington seems to know what to do about it. Our nation could really use some of Mr. Rubin’s wisdom on the subject of fiscal probity.

My view is that generally, people who make policy recommendations are sincere in their beliefs that their proposals will bring socio-economic benefits. Even the best of ideas can have unintended negative consequences. And quite frequently, the benefits or harms of policies manifest themselves only after considerable amounts of time have passed. When the detriments become evident, we learn from them as a society and revise the designs that caused them. That is the essence of democracy.

Hefty executive compensation packages have become a highly contentious subject in America over the last few decades. They form part of the broader national conversation about economic inequality. Those are legitimate debates to have. The worry though is that the feelings people have about these issues have reached such intense levels nowadays that the voice of anyone seen as part of the “greedy” class is automatically considered to be morally compromised. That cannot be good for the country.

The overwhelming majority of American youth, whether they graduate from high school or college, end up working in the public and private sectors. At the start of any professional occupation, every young person has a lot to learn. People like Mr. Rubin who have had long and highly successful careers in both business and government, and have seen so much else in life, happen to be those who are best placed to offer such guidance. Dismissing a voice like that of Mr. Rubin as unqualified to offer words of wisdom would be a great disservice to young people, and in fact everyone else, in this country.

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