Current Position: Assistant Treasury Secretary for Financial Institutions (since May 2009)
Boss: N/A
Credit: Dept. of the Treasury
Why He Matters
When Barr first joined the Treasury during the Clinton administration, he was a neophyte. Out of law school for only three years, Barr was named to the plum post of special assistant to Treasury Secretary Robert Rubin.
The University of Michigan law professor worked as a senior fellow at the liberal Washington think-tank the Brookings Institution. At Brookings, he authored papers outlining how the government should help banks aid the poor, and called for government intervention in the mortgage market months before Bear Stearns collapsed in March 2008.
At a Glance
Current Position: Assistant Treasury Secretary for Financial Institutions (since May 2009)
Career History: Professor at the University of Michigan Law School (2001 to 2008); Deputy Assistant Secretary at the Treasury (1997 to 2001); Special Assistant to the Secretary of the Treasury (1995 to 1997)
Birthday: N/A
Hometown: N/A
Alma Mater: Yale University, B.A. (history), 1987; Oxford University, M.Phil, 1989; Yale Law School, J.D., 1992
Spouse: Hannah Smotrich
Religion: N/A
DC Office: N/A
State/District Office: N/A
Email N/A
Web site
Path to Power
A native of the Beltway enclosing the nation’s capital, Barr grew up with a mom who taught high school English and a dad who worked in labor law. For college he went to Yale University to study history, where he developed an interest in South African affairs. Barr even joined the Coalition Against Apartheid, a group that protested Yale’s investments in companies that did business in South Africa while the forced segregation continued in the African nation.
Barr nearly let his personal feelings about apartheid get in the way of his academic accomplishments. In 1986, he almost chose not to apply for a Rhodes Scholarship in protest of the award’s creator, early-19th-century British financier Cecil J. Rhodes, a controversial figure who gained success and wealth by mining diamonds in South Africa. But he reasoned that the award committee ensured that women and minorities have an equal opportunity to be awarded the scholarship, so he opted to go for it and won the scholarship. In 1989 Barr earned a master’s at Magdalen College at Oxford University. Shortly afterwards, Barr returned to Yale to earn a law degree in 1992.
Upon graduation, Barr became a law clerk for Southern District of New York Judge Pierre N. Leval, where he stayed a year before becoming a clerk for Supreme Court Justice David H. Souter. After working for the justice for a year, Barr joined the President Bill Clinton’s State Department as a special adviser and counselor to Director of the Policy Planning Staff James W. Steinberg.
Clinton administration
In 1995, Barr first joined the Treasury Department as special assistant to the secretary. He worked under Clinton Treasury Secretary Robert Rubin for two years, until he got a promotion to deputy assistant secretary for community development policy in 1997. From 1999 to 2001, while serving as a deputy assistant at the Treasury, Barr also worked as a special adviser to President Bill Clinton.
When Clinton’s presidency ended in 2001, Barr moved to Ann Arbor to teach at the University of Michigan law school, specializing in financial institutions, international finance and trans-national law. Barr also worked as a senior fellow at the Brookings Institution, a liberal think-tank from which Obama has culled many administration aides.
The Issues
By March 2009, the Treasury still lacked appointments to many senior positions, despite the global financial meltdown. The Obama administration’s vetting process for potential candidates grew more stringent following the tax issues that troubled Treasury Secretary Timothy Geithner’s confirmation. Barr made the cut, and Obama named him to assistant secretary of financial institutions in late March 2009.
In his return trip to Treasury, Barr brings with him a vast knowledge of credit-card systems and has often argued for more government banking initiatives that serve the poor.
2008-2009 Financial Crisis
Long before the financial crisis exploded, Barr called in January 2008 for government intervention in stopping home foreclosures. Prior to the government bailout of Bear Stearns and the demise of Lehman Brothers, Barr testified before the Senate Banking Committee and called for government intervention in the mortgage market. In a hearing discussing the likelihood of a rash of foreclosures expected to hit nationally, Barr was asked whether he believed the government should create programs to save people’s homes. “I don't think we can afford to wait,” said Barr, who was working as a Brookings senior fellow and a University of Michigan professor at the time. “I think that the easy trap, in financial crisis, is to wait too long and do too little and watch the bad news dribble out, and not be on top of it.”
“I think, if you look at the evidence of intervention in financial crises in the past, in serious financial crises, they are far more -- those interventions are far more successful if they're done rapidly and at scale, rather than dribbled out and slowly.”
As bad bets on subprime mortgages crippled financial institution towards the end of 2008, Barr continued to testify before Congress. In the same congressional hearing where Bush Treasury official Neel Kashkari was asked by Rep. Elijah E. Cummings (D-Md.) if banks thought he was a “chump” for the way the Treasury had handled the bailout funds, Barr testified on ways those funds could be used to stave off foreclosures. Barr pointed out that the bailout legislation authorized the Treasury to “purchase troubled assets, including home mortgage loans.”
Barr called for the Treasury to help stem home foreclosures by guaranteeing home loans to the “servicers” who controlled the subprime loans for mortgage-backed securities’ investors. In order to avoid liability and extra taxes, the servicers often foreclosed on those unable to pay their mortgages instead of restructuring the loan. Barr wanted to use some of the bailout funds to guarantee the mortgage loans to the servicers, and pay them for restructuring the loans instead of foreclosing on a family that couldn’t afford the mortgage payment. Barr also called for the Treasury to allow the Federal Deposit Insurance Corporation to guarantee the loans and bolster the Federal Housing Administration, which needed more resources to aid in the foreclosure crisis.
The Network
From 1995 to 1997, Barr served as Clinton Treasury Secretary Robert Rubin’s special assistant to the secretary. While there, Obama National Economic Adviser Lawrence H. Summers worked as Rubin’s deputy secretary.
In 1999, while Barr worked as deputy assistant secretary for Community Development Policy at the Treasury, he tackled the dual role of executive director of the District of Columbia task force at the OMB. Obama’s deputy secretary of state, Jacob Lew, served as OMB director from 1999 to 2001.
When Barr worked for Clinton's State Department, he advised Director of the Policy Planning Staff James W. Steinberg. Steinberg joined the Obama administration as deputy secretary of State.
Barr joined Treasury Secretary Timothy Geithner’s team in May 2009, and works closely with Deputy Secretary Neal S. Wolin, Assistant Secretary for Economic Policy Alan B. Krueger and Assistant Secretary for Tax Policy Helen Elizabeth Garrett.
After attending law school, Barr clerked for Supreme Court Justice David H. Souter.
Campaign Contributions
While living in Michigan, Barr donated over $3,300 to Democratic campaigns since 2007. In 2008, Barr donated $2,550 to
Barack Obama’s presidential campaign.
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