Freitag, November 07, 2008

So, The Fun Begins...

Rahm Emanuel has been chosen by President-Elect Obama to be his chief of staff.

Who is Rahm Emanuel?

Well, he is a Democrat from the State of Illinois, the number 4 Democrat in the House of Representatives.

He is also considered one of the more ruthless Democratics in the House and is known for being zealously partisan. Fair enough: that's what the Democratic party, right now, is all about. It's part of the reason they won the election.

Now, the real question is: who sent Rahm Emanuel? If you don't understand that question, then you don't know how Chicago politics works, and understanding that will give you insight into the new administration, which will be heavily stacked with folks from Chicago where it matters (the core political group around the future President). This "who sent him" means nothing more than "Who does he get his money from?"

In Emanuel's case, it's Wall Street. See here.

Over the last six years, $1.5mn from the investment community, followed by lawyers and the entertainment industry. The money from the investment community should come as no surprise: he was, after all, an investment banker between his time with the Clintons and being elected to Congress.

Where was he an investment banker?

Now it gets interesting.

Clinton appointed him to the Board of Directors of Freddie Mac. Then he moved to Dresdner Kleinwort Wasserstein, working on high-profile M&A, using the contacts he had made during the Clinton years. Why was he hired? The key word is Wasserstein: Bruce Wasserstein was one of Clinton's most active fundraisers. His client base at DKW was the Democrat's rich financial backers. His biggest deals were with politically connected utilities (such as a merger with the corporate parent of Commonwealth Edison, which is Chicago's utility company and heavily involved in Chicago politics, which are almost per definition Democratic politics). He is now a multi-millionaire and the 34th wealthiest member of the House of Representatives.

In other words, another Washington insider who used his connections to make millions.

This is the face of the new administration in Washington. This is the man who will be Obama's Chief of Staff. He's one of the people who got Freddie Mac into the trouble that they are in now.

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