Andrew Ross Sorkin would've fit in well in the Roman Empire: He knows a scribe's job is to glorify elite privileges: http://t.co/HcwmUkhd05
— billmon (@billmon1) August 20, 2013
.
Shorter Sorkin: How can it be a ‘corrupt practice’ when everybody does it?
… Over the weekend, The New York Times reported that the Securities and Exchange Commission had opened an investigation into whether JPMorgan Chase had hired the children of powerful Chinese officials to help the bank win business.
The investigation is sending shudders through Wall Street. If JPMorgan Chase is found to have violated the Foreign Corrupt Practices Act by hiring the children of the elite, then the entire financial services industry is probably in a heap of trouble. Virtually every firm has sought to hire the best-connected executives in China and, more often than not, they are the “princelings,” the offspring of the ruling elite.
Under the Foreign Corrupt Practices Act, a company is not allowed to provide a personal benefit to a decision maker in return for business. But hiring the sons and daughters of powerful executives and politicians is hardly just the province of banks doing business in China: it has been a time-tested practice here in the United States…
But by and large, financial firms in particular commonly hire people who have certain connections, whether through family or a business relationship. The thinking is that the new hire — and his or her last name — might “help open doors,” Mr. Driscoll said. But, like many people I interviewed on this topic, he did not see a legal issue with such hires. “I don’t think there is a quid pro quo,” such that the hiring of children is explicitly generating business from the parent. At best, he said, “It gets you in the room.”…
The same goes for the prime example of this issue in the United States: Chelsea Clinton. Ms. Clinton worked at the consulting firm McKinsey & Company after college and later at Avenue Capital, a hedge fund founded by a big Clinton fund-raiser, Marc Lasry. But Ms. Clinton, a Stanford graduate who is considered intelligent by virtually everyone who has spent time with her, had as genuine a claim on those jobs as anyone else graduating the year she did.
Did it matter who her parents were? Of course it helped. She’s since gone on to become a director of IAC/InterActiveCorp, Barry Diller’s Internet company, and a contributor to NBC News, roles that critics have also complained about. (Full disclosure: I host CNBC’s Squawk Box, which is part of NBC News.)
And then there is Robert Rubin’s son Jamie, who worked at the Federal Communications Commission and at Allen & Company, the boutique bank, while his father was part of the Clinton administration. I’ve known Jamie for years and he, too, probably would have landed prominent posts even without his name. In some cases, some of these children will tell you that they try to work harder than others at their jobs, just to prove that they earned the position….
Expect a hard-hitting investigative expose from Luke Russert, any day now.
schrodinger's cat
Well at least we are not electing Presidents based on who their fathers were, oh wait…
Tokyokie
I got my first real job, with my city’s street department, because my father, who was the (unpaid) county sewer commissioner, was pals with the city street department superintendent. But somehow I’m guessing slinging asphalt into chug holes and clearing brush is a bit more labor-intensive than the jobs these “princelings” enjoy.
Phil Perspective
I’ve known Jamie for years and he, too, probably would have landed prominent posts even without his name. In some cases, some of these children will tell you that they try to work harder than others at their jobs, just to prove that they earned the position ….
ARS sure loves making excuses for the elite. Is there anything he won’t do for them?
Trollhattan
@schrodinger’s cat:
Related to nothing other than your nym, have you one of these?
http://www.thinkgeek.com/product/e9cb/
cathyx
Yeah, but no, in reality, he wouldn’t have even gotten an interview. This guy needs a taste of real life for the 99%.
lamh36
OT, but just read this on twitter, hoping for good news for Beau Biden.
schrodinger's cat
@Trollhattan: I can usually tell whether I am dead or alive without that box.
Thread needs kitteh
cathyx
I’ll bet that no one in Chelsea’s class who also did well in her class but didn’t have a prominent connection has landed such a job.
Davebo
The Foreign Corrupt Practices Act is a sad joke for anyone who’s done business in W. Africa, South America or Asia.
Trollhattan
@schrodinger’s cat:
Love the video where the lab-coat dudes use it and a flowchart to choose tacos for lunch.
MikeJ
@cathyx: You don’t think other Stanford grads wound up working for consulting firms? I would find that very, very difficult to believe.
schrodinger's cat
@Trollhattan: That’s funny.
Bobby Thomson
@lamh36: not really OT. Unfortunately.
Phil Perspective
@MikeJ: I’d bet he means the NBC job, firstly.
cathyx
@MikeJ: Do you think they would land a job at a hedge fund founded by a big Clinton fund-raiser, Marc Lasry?
? Martin
@MikeJ:
And nobody has stopped to consider that anyone with a recognizable name manages to get admission to an Ivy, which in turns gives you the connections to get damn near any high profile job you want? The meritocracy fails a lot earlier than you are suggesting.
Just Some Fuckhead, Thought Leader
Sorkin is just saying when you’re One of the Elite, it’s really hard to tell where your hard work and savvy mind leave off while your privilege and connections take over.
Roger Moore
@lamh36:
Well, at least if the results are bad news, he’s in a good place to do something about it.
Suffern ACE
Hmmm. This places me in a quandary. I shall be going on a hunger strike until the children of chinese government officials are treated no differently than the children if our own government officials. Or ar least until 6:30pm I won’t have a bite.
Gene108
@Davebo:
I agree.
It does probably save those countries from themselves.
U.S. firms having gobs of money and no limits on bribery could easily translate to officials selling their countries assets to foreign corps. I’m sure it happens, but the law probably slows this down by limiting what our firms can do in this regard.
cathyx
@? Martin: Are you trying to say that George Bush got into Yale and Harvard by connections and not by his good grades and hard work?
Roger Moore
@? Martin:
Notice that they were careful to choose the scions of Democrats for their examples, rather than the spawn of, say, Bush, Cheney, or Romney. Because it’s always more fun when you can take a swipe at the Democrats in the process.
jl
bothsidesdoit, dude
p.a.
@Roger Moore: beat me to it.
Keith P.
@? Martin: She went to Sidwell Friends. I think just about every one of her classmates has the kind of connections that would help gaining admission to Stanford. But even taking that out of the equation, that school has the kind of reputation whereby graduating from it with good grades alone (plus the ability to pay without financial aid) gets you admission. I went to a good private school and got (very) good grades, and I had no problems getting admitted to several Ivy League schools; it was the paying for them part that I had trouble with.
Anoniminous
A distinguishing characteristics of a social group is mutuality: I hire your
obnoxious bratchild and you hire mine.Nepotism begins at home, too. Also.
Mandalay
@Roger Moore:
Well I was already thinking about Chelsea Clinton as soon as I read the first couple of lines of the article. Since the article was about Wall Street, which prominent Republican scions should have been mentioned instead?
Bush’s daughters went nowhere near Wall St. and have probably done far more to make the world a better place than Chelsea Clinton.
SiubhanDuinne
@lamh36: Oh, I hope so. Saw earlier (last night? this morning?) that he had had a seizure. I do hope for a good outcome for him. Thoughts and white light are with the Bidens.
? Martin
@Mandalay: Bush himself was such a scion. Harvard and Yale for him as son of the head of the CIA and then President.
How much did he do to make the world a better place?
Liz Cheney went to U of Chicago. Mitt Romney went to Harvard. Both had prominent parents when they went. Tagg Romney went to Belmont and then to Harvard. He’s on Wall Street.
It’s not hard…
jamick6000
@Phil Perspective: Sorkin wrote a column about how his friends are smart and great.
RaflW
Patronage and nepotism may be “how things are done” but if they stink and deserve to be exposed, well, Andrew Ross, that’s how it shall be.
Please continue to clutch your pearls. Its cute when you do that.
Roger Moore
@Mandalay:
The Romney spawn- including Mitt, for that matter- would be a good start.
gene108
@Mandalay:
Barbara (the younger) Bush went to Yale like her father and grandfather.
Jenna has a gig on the Today Show.
The fact Jenna went into education and Barbara has her own non-profit, and seems to have repudiated the Republican Party platform on same sex marriage, doesn’t mean they don’t get help because of their name.
Chelsea seems to have some involvement in the Clinton charitable foundation these days.
Given how screwed up their father’s administration was, uncle Neil skating from serious charges because of his connections, their generation of Bushes seems to be a bit more independent minded than just grifting and sucking up money and political power.
Neils daughter Lauren Lauren* also has a charitable streak, with regards to starting non-profits.
*Lauren Bush, Neil’s daughter, married Ralph Lauren’s son. Her name really is Lauren Lauren (though the internet says she goes by Lauren Bush Lauren)
Another Holocene Human
@Keith P.: I know people who transfered from public to storied private schools (in the Northeast, not the South–I have no idea what goes on at those Christian “academies”) and the private schools were easier.
So there’s that.
Mandalay
@? Martin: @Roger Moore: @gene108:
Well you are all rather missing the point, which is that the article was examining Wall Street and financial institutions.
Again, who are the Republican counterparts to the “prime example” of Chelsea Clinton? To my surprise, I can’t find any good ones, and apparently you can’t either.
Chris
@Just Some Fuckhead, Thought Leader:
If you’re one of the Elite, it’s just assumed that you have a work ethic and savvy mind. Or that you should be treated as if you did, at least. You just don’t question people of such heritage.
Chris
@Mandalay:
… did you somehow miss the two references to Romney/Wall Street that were made in two of the posts you were responding to?
Roger Moore
@Mandalay:
Mitt Romney. He got a start on Wall Street largely because of his political connections- remember that his dad was a governor and presidential candidate- and was given a ton of opportunities that people without equal connections never would have gotten. A major point of Bain Capital was to take advantage of Romney’s connections to attract investors. He went on into politics himself, and lo and behold, several of his sons were hired on Wall Street, too.
danielx
@Phil Perspective:
No.
This has been another edition of Simple Answers To Simple Questions.
danielx
And while I’m thinking about it, hiring the scions of these elite persons may not be such a hot idea, at least if you’re interested in the long term success of the hiring organization. See Elites, Twilight of the.
Of course, this presupposes that Wall Street in particular has any interest in the long term success of anything except the financial well-being of Wall Street…
Mandalay
@Chris:
Not at all, but I find the Romney examples to be poor ones.
Mitt Romney graduated in the top third at Harvard Law School and the top 5% at Harvard Business School. Willard may have got into Harvard because of his father, but surely his graduation results were due to his own efforts. I see no evidence that he landed any job because of his family connections, and he steadily worked his way up and made a fortune at Bain on his own AFAIK.
I loathe the man, but I do not see that he received anything like the golden reception accorded to Chelsea Clinton on Wall St. Similarly, based on Tagg Romney’s career, I don’t see any obvious evidence at all that he had everything handed to him on a plate by his dad.
All that said, I loathe the Romneys and all they stand for, and will be glad to hear of any evidence to the contrary. I am just not seeing it myself.
Mandalay
@Roger Moore:
You don’t think it was because he was in the top 5% at Harvard Business School, and graduated cum laude from Harvard Law School? You think that is irrelevant, and he only landed a job because of his dad?
Mnemosyne
@Mandalay:
It’s not as simple as that. Was Sofia Coppola able to direct her first movie because she’s talented, or because she had family connections? The answer to both questions is yes. She is talented, and her family connections helped her move forward much more quickly than, say, the equally talented Jane Smith would have, even if Jane Smith had attended the same schools and gotten the same (or better) grades.
It’s both/and. The fact that children of privilege work hard at their jobs does not remove the fact that they got those jobs in part thanks to their privilege of going to the right schools and knowing the right people. They didn’t have to settle for a crappy fast-food job to pay the bills while they were going to school, so they were able to take unpaid internships. They didn’t have to find a job immediately after graduation to start paying their student loans, so they were able to go on multiple interviews and polish their resumes while their classmates were scraping by.
Lurking Canadian
@Mnemosyne: This. Our modern aristocracy does a better job than the last kind. With rare (GW Bush) exceptions, power and wealth are not passed to the lazy, imbecile, good-for-nothing scions of wealth. There are enough kids born on (or halfway around) third base that there can be a genuine competition to see who gets to home base first, so they can tell themselves they’ve earned all they have.
Doesn’t change the fact that that group has an immense advantage over those who were just born on second, never mind those who actually start with nothing.
cckids
This. Their family/wealth privilege is the floor they stand on, but they (by and large) do not see it. They know they work hard, and they probably do,but, as you say, no more so than John Smith.
Doors are opened for them automatically & they float through life believing they have The Force.
Mandalay
@Lurking Canadian:
That is not in dispute. Both Mitt Romney and Chelsea Clinton obviously had a helping hand in getting to a good college.
But was not the issue under consideration. Once they graduated, I see no hard evidence that Mitt Romney received any special help in landing jobs, he had stellar qualifications, he stuck at it, and he clearly made his fortune at Bain by being the best at that (sordid) game.
In contrast, Chelsea Clinton, with her history degree, landed a plum job on Wall St., then left because she found it “meaningless”. Nobody here has shown any persuasive evidence that Romney didn’t get his positions and become rich based on his own efforts, whereas Clinton’s Wall St career stinks of privilege, special treatment and back scratching.
Mnemosyne
@Mandalay:
I guess you missed this article, then.
But, yes, I’m sure there were absolutely no strings pulled to help Mitt find work after he graduated. It’s not like his father was a former governor or the former CEO of an automobile company, so there’s no way anyone could have wanted to advance Mitt’s career in the hope of getting in good with George Romney, amirite?
gene108
@Mandalay:
What “golden reception” did Chelsea Clinton get at McKinney or where she worked in finance? There’s no evidence that after landing a job that she got rushed to high level positions ahead of others, because of her name.
Also, too why the Stanford hate? As MikeJ stated above, many Stanford grads could more than likely land jobs at places like McKinney.
Mike G
Willard’s life of privilege was a precondition for developing the arrogant sociopathy and disregard for regular people that is so essential to being a vulture capitalist.