BySMARTMONEY MAGAZINE STAFF
A year ago, with the markets and the economy in meltdown, the SmartMoney Power 30 was full of the usual cast of government giants and Wall Street heavyweights: Bernanke, Geithner, Buffett. But as we move to a new phase, a time of slow but seemingly steady recovery, some of the biggest players might seem more on the fringe academics, advisers, even a lobbyist. What follows is a mix of the famous and not-so-famous, all trying to make sure in their own way that the Great Recession turns into the Great Recovery.
Sheila Bair
Chairman, Federal Deposit Insurance Corp.
A Republican appointed by George W. Bush to head the federal agency that insures bank deposits and bails out failing banks, Bair, 55, still has a lot of work to do. She has been an outspoken critic of the industry, pushed for more authority to regulate banks "too big to fail" and publicly criticized President Obama's financial-system reform plan, saying major parts of it won't make it through Congress. Next up: dealing with the growing number of "problem" banks, which recently topped 400, and the FDIC's insurance fund-at its lowest level since 1993.
Ben Bernanke
Chairman, Federal Reserve
He might not be a rock star, but he's hardly keeping the low profile many thought he would when he succeeded the more camera-friendly Alan Greenspan as Fed chairman. Bernanke, 55, sat down for an interview with 60 Minutes, took questions from mainstream Americans in a town hall meeting in Kansas City, Mo., and cooperated with a Wall Street Journal reporter on a book-about his role in taming the financial crisis.
The idea behind the unprecedented publicity is to get the average American to understand what's at stake in the Fed's extraordinary efforts to juice the economy. Now that the former Princeton professor has steered us away from a second Great Depression-earning the cheers of fellow economists, if not politicians-he'll face the toughest trick of all as his second four-year term begins in 2010. He has to decide when and how to slow the economy before inflation returns. "Will he have the guts to put the brake on when the unemployment lines are painfully long?" asks James Angel, associate professor of finance at Georgetown University's business school.
Earl Devaney
Chairman, Recovery Act and Transparency Board
A year ago, no one had ever heard of Earl Devaney. Then again, Congress also hadn't authorized a $787 billion stimulus package intended to resuscitate the economy-and with it, a government unit to make sure that money is spent prudently. Now the 61-year-old Interior Department's inspector general has two and a half years and a budget of $84 million to see that the stimulus package does what it's supposed to do. Step one: Get all Americans involved, via Recovery.gov, which lets anyone with Internet access see exactly where and how the money's being spent, down to the most minute details of individual contracts. Then, after essentially deputizing the population as his watchdogs, Devaney and Co. are charged with tracking fraud, waste and abuse-problems they hope citizens will flag as they dig into the data on the site. "Once the American people can see how their money gets spent, we'll never do it the old, nontransparent way again," Devaney says. "The cow is out of the barn. This is the future."
Doug Elmendorf
Director, Congressional Budget Office
The former Harvard economics professor serves as a reality check on government spending, putting a price tag on everything from the tiniest piece of pork to the cost of health care reform-and so he indirectly affects policy (along with the rest of the nonpartisan CBO). After spending much of his career behind the scenes, Elmendorf, 47, says he is learning to "pick my words carefully." Earlier this year, his blunt questions about proposed health care reform bills slowed down Democrats' efforts right before the summer recess and put him at odds with his predecessor Peter Orszag, who is now the president's budget chief. Given the spate of proposed reforms on the table, the drama isn't expected to end any day soon. The tension is just part of the job, says Alice Rivlin, who has held both men's positions in the past, but she adds, both roles "are probably crucial"-perhaps now more than ever. As Congress begins to shift its focus to other issues, Elmendorf says he is building up CBO's ability to analyze financial-sector issues in the wake of the government's deeper involvement-for example, with Fannie Mae and Freddie Mac-which will affect the budget and also will likely push Congress to explore ways to approach the housing market in the future.
The 2009 SmartMoney Power 30
Kenneth Feinberg
Special Master for TARP Executive Compensation
Feinberg doesn't take easy jobs. The Washington, D.C., lawyer has overseen victims' settlements for the 9/11 terrorist attacks and the Virginia Tech shootings. Compared to those grim assignments, judging the fairness of Wall Street executive pay doesn't seem so hard. As the Obama administration's pay czar, Feinberg is reviewing executive and employee salaries and perks at the seven companies that have received "exceptional" government assistance, including AIG, Citigroup and General Motors. Perhaps his most aggressive move to date was pressuring outgoing Bank of America Chief Executive Kenneth Lewis to return $1 million he received this year and to forgo the rest of his 2009 salary and bonus. Corporate America is watching Feinberg closely: At a time when shareholders are loath to award millions to executives at struggling companies and pending legislation would require public companies to submit executive pay to a shareholder vote, Feinberg's guidance on compensation holds a lot of weight. "It certainly takes a lot of the fervor out of the debate," says Scott Talbott, the head lobbyist for the Financial Services Roundtable.
Timothy Geithner
U.S. Treasury Secretary
Wall Street greeted Timothy Geithner's speech on fixing the banking system last February with a 382-point slide in the Dow. Now that the economy has stabilized, his to-do list includes pushing the administration's proposals for financial reform and reassuring countries like China that Uncle Sam is good for his debt. But it's still a rough road. Critics say the administration has failed to live up to its ambitious agenda. "They're letting Congress push them around," says Lawrence J. White, an economics professor at New York University. On Capitol Hill in July, Geithner, 48, acknowledged the backlash to Obama's regulatory plans and pushed for action this year: "If we wait and we try to do it piecemeal, it's going to be much harder."
Valerie Jarrett
White House Senior Adviser
When America's CEOs have something to say to the president, Jarrett can help. Last spring, travel executives upset over Obama's remarks about business travel were surprised to see the president pop in on their meeting with White House economic officials. The visit-and a presidential lunch over the summer with CEOs from Xerox, AT&T and Coca-Cola, among others-were arranged by Jarrett, who also happens to be one of the president's closest friends.
The 52-year-old lawyer once ran Chicago real estate developer The Habitat Co. and sat on various boards, including the Federal Reserve Bank of Chicago and the Chicago Stock Exchange, where she was chairwoman. That experience and her friendship with the president make Jarrett an invaluable bridge between government and business in her role as senior adviser. (Obama has called Jarrett his eyes and ears and said he trusts her completely.) "She's like Warren Buffett-someone who will give you great sound advice," says Ariel Investments founder John Rogers Jr., who grew up with Jarrett in Chicago's Hyde Park neighborhood. "They may tell you something you don't want to hear, but you realize it was exactly what you needed."
Peter Orszag
Director, Office of Management and Budget
Regularly described as tough and disciplined-he has trained for marathons in the middle of the night-Orszag, 40, is one of the leading experts on health care, Social Security and retirement policy. The self-described "supernerd" regularly meets with members of Congress in a frontline role not typical of most economists. But Orszag's flair for adjusting policy to address concerns while still achieving stated goals makes him a valued member at the table, says Robert Greenstein, director of the Center for Budget Policy and Priorities. As the man controlling the nation's purse strings, Orszag tells SmartMoney he "is very concerned" about the nation's record budget deficit. But he says the focus should be the medium- to longer-term deficit, after the economy has recovered. But "key to our fiscal future," he says, is reining in health care costs. After building up health care capabilities as the former director of the Congressional Budget Office, he now finds himself at odds with the CBO over recent health care reform proposals. "Even the best referee sometimes gets things wrong," he says. "And when that happens, it is healthy to point it out."
Elizabeth Warren
Chair, Congressional Oversight Panel
Elizabeth Warren rarely got results like these as a Harvard law professor: Less than a month after taking her new role as lead watchdog over the Wall Street bailout, she slammed the U.S. Treasury for failing to adequately monitor payouts from the Troubled Asset Relief Program and for its secrecy in general, and the department promised more transparency and better tracking of funds. Warren, a specialist in bankruptcy law and consumer debt, isn't stopping there. She's pushing for stronger stress testing of banks and more regulation of products like credit cards, car loans and mortgages through the creation of a Financial Product Safety Commission.
Not everyone's a fan. Warren's proposals have drawn fire from almost anyone with an interest in maintaining the status quo, including the banking industry, mortgage brokers and even the Securities and Exchange Commission. But she says she's not backing down: "I'm not an insider, and I don't need another job," she says, a not-so-thinly veiled shot at what she sees as the revolving door between public office and private industry. "I'm willing to do whatever it takes to raise the issues that I think are important, regardless of who wants to ignore them."
The 2009 SmartMoney Power 30
- LinkedIn
- Fark
- del.icio.us
- Reddit
X