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Neal S. Wolin

1. Why He Matters
2. At a Glance
3. Path to Power
1. 3.1. The Hartford
4. The Issues
1. 4.1. Gramm-Leach-Bliley Act
2. 4.2. Insurance Representation
3. 4.3. Financial Regulation Reform
5. The Network
6. Campaign Contributions

Current Position: Deputy Treasury Secretary (since May 2009)

Boss: Treasury Secretary Timothy Geithner

Credit: Dept. of the Treasury

Table of Contents

1. Why He Matters
2. At a Glance
3. Path to Power
1. 3.1. The Hartford
4. The Issues
1. 4.1. Gramm-Leach-Bliley Act
2. 4.2. Insurance Representation
3. 4.3. Financial Regulation Reform
5. The Network
6. Campaign Contributions

Why He Matters

Treasury Secretary Timothy Geithner needed help. More than two months into his role as the head of the Treasury Department during the worst economic crisis since the 1930s, the fledgling cabinet secretary lacked top aides to implement a sweeping economic recovery plan. Most notably, Geithner lacked a number two.

In March 2009, after an exhaustive search that included a number of withdrawals by top candidates, President Barack Obama nominated Wolin as Geithner’s deputy secretary.

This won’t be the first time Wolin has stepped through the doors at the Treasury. He spent six years in the Clinton administration as deputy counsel and general counsel at the Treasury. Wolin has also served in various other government positions, including stints at the National Security Council (NSC) and the Central Intelligence Agency (CIA). Wolin has already worked in the Obama administration as the White House deputy counsel for economic policy and deputy assistant to the president.

In 1999, Wolin supervised a team of Treasury lawyers that drafted a version of the Gramm-Leach-Bliley (GLB) Financial Modernization Act that allowed banks, insurance companies and brokerage firms to merge.Interview with former Deputy Secretary at the Treasury Stuart Eizenstat Economists largely agree that while the merger may not have directly led to the current recession, it opened the door to the creation of large financial institutions. Some of these institutions have been deemed “too big to fail” because of the gigantic ripple effect that would create on the global economy.

At a Glance

Current Position: Deputy Secretary at the Treasury Department (since May 2009)

Career History: Deputy counsel for economic policy at the White House (Feb. 2009 to March 2009); President and chief operating officer for property and casualty operations at the Hartford Financial Services Group and other positions at Hartford (2001 to 2008); General Counsel at the Treasury Department (1999 to 2001)

Birthday: N/A

Hometown: Chicago, Ill.

Alma Mater: Yale University, B.A. (history); Oxford University, M.S. (development economics); Yale, J.D.

Spouse: N/A

Religion: N/A

DC Office: N/A

State/District Office: N/A

Email N/A

Web site

Path to Power

Wolin’s parents lived in Evanston, Ill., just outside Chicago, where his mom was a director of the Israel Experience, a program at the Jewish Federation of Metropolitan Chicago that helps young adults visit Israel. His father was a partner at the Chicago law firm Cohon, Raizes & Regal."Nicole Elkon, Neal Wolin," The New York Times, June 1, 2003

Wolin went to Yale University where he earned a bachelor’s in history, graduating summa cum laude. Wolin then went to Oxford University as a Charles and Julia Henry Fellow, earning a master’s of science in development economics before getting a law degree at Yale.

After law school, Wolin worked at the venerable Washington, D.C. law firm of Wilmer, Cutler & Pickering before joining the federal government as a special assistant to the director of the CIA. He worked under three directors at the nation’s top intelligence agency: William H. Webster, Robert M. Gates and R. James Woolsey. In 1993, Wolin moved to the NSA as a legal adviser. He would stay until 1995, when he left to work as a deputy general counsel at the Treasury under Secretary Robert Rubin.

Wolin stayed at the Treasury for six years, becoming general counsel to Secretary Lawrence H. Summers in 1999. In January 2001, Summers gave Wolin the Alexander Hamilton Award, the highest honor awarded to a Treasury official.The Hartford Web site

The Hartford

When President George W. Bush took office, Wolin left government. In March 2001, Wolin found himself at the insurance company, The Hartford, working as an executive vice president and general counsel. He oversaw the company’s legal, government affairs and marketing functions, among other duties. Wolin stayed at the Hartford until 2009, becoming president and chief operating officer for property and casualty operations at the Hartford Financial Services Group during his tenure with the company.

President Obama asked Wolin to join his administration as a deputy counsel for economic policy at the White House in January 2009. In May 2009, confirmed Wolin as Geithner’s number two at the Treasury Department.

The Issues

In March 2009, the effort to name a deputy Treasury Department secretary was magnified because of the burgeoning economic crisis and a couple withdrawals from potential candidates. Former Securities and Exchange Commissioner (SEC) Annette Nazareth, a partner at the Washington, D.C. law firm Davis Polk & Wardwell, reportedly withdrew her name from consideration after it became clear her work at the SEC would come under harsh criticism during the confirmation process.Schmidt, Robert, "Nazareth Said to Withdraw for Deputy Treasury Post (Update4)," Bloomberg News, March 5, 2009 H. Rodgin Cohen, chairman of the New York law firm Cromwell & Sullivan LLP, also withdrew his name from consideration.

But all the while, Geithner had to deal with the vast task of formulating strategies to pull the U.S. economy out of a recession not seen since the 1930s. His job included installing new multi-billion dollar programs under the Financial Stability Plan, with little help from a cadre of seasoned aides. Wolin’s nomination came a day after Geithner publicly outlined the Public Private Partnership Investment program, which will allow private investors to purchase assets from banks in cooperation with the government, which will take on the majority of the risk. The program expects to rid lenders of up to $1 trillion of troubled assets.Ablan, Jennifer and Stempel, Jonathan, "UPDATE 5-U.S. bank shares soar on toxic asset plan," Reuters, March 23, 2009

Gramm-Leach-Bliley Act

The Gramm-Leach-Bliley Act (GLB) passed in 1999, and it repealed the Glass-Steagall Act of 1933 that banned banks from merging with insurance companies and brokerage firms. GLB made it legal for a bank to merge with other financial institutions, but the newly-formed company would have to submit to more oversight by the Federal Reserve. While the new law didn’t directly lead to the mortgage defaults and credit failure that crippled the banking industry in 2008, it did allow for the birth of giant financial companies like Citigroup. Citibank pushed the issue of repealing the Glass-Steagall Act in 1998, when Citibank and the insurance company Travelers announced a merger. (Congress’ passage of GLB ratified the Citibank and Travelers merger.Wallison, Peter J., "The Wal-Bank Principle," The Wall Street Journal, April 25, 2006 Citigroup has since spun-off Travelers.)

Many large, diverse financial institutions were deemed too big to fail when the credit market disintegrated in 2008.

As Treasury general counsel in 1999, Wolin oversaw the team of lawyers that helped review the GLB bill that became law that year.Interview with former Deputy Secretary at the Treasury Stuart Eizenstat

Insurance Representation

In June 2008, Wolin testified in front of the House Financial Services subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises, in which he backed the creation of the federal Office of Insurance Information (OII) within the Treasury. “It would thereby create an insurance expert who serves as the principal federal advisor on domestic and international policy issues for all lines of insurance but health,” said Wolin. “In one stroke, we would answer the call for a single national voice on these important matters.”Neal S. Wolin testimony, June 10, 2008

The creation of the OII was controversial because many felt it would create an oversight organization to which states’ insurance commissioners would have to answer.Palm, Anika Myers, "State commissioners wary of expanded federal role," Orlando Sentinel, Sept. 22, 2008 The measure got through the subcommittee, and is still under consideration in the full Financial Services panel.

Financial Regulation Reform

In 2009, the administration supported the reformation of the financial regulatory system, due to its failure in preventing the 2008-2009 recession. Wolin made many public comments on the proposed changes and in July 2009 published an op-ed in The Hill, which outlined these modifications.Wolin, Neal, "Consumer protection agency would stop companies’ race to the bottom," The Hill, July 23, 2009

The proposed reform includes a way to increase systemic oversight of the entire financial system. "At the same time, key financial institutions -- including some of the largest, most interconnected firms -- were not effectively supervised," wrote Wolin. "While various regulators were responsible for supervising particular subsidiaries, no one was taking a hard look at some of these institutions as a whole."Wolin, Neal, "Consumer protection agency would stop companies’ race to the bottom," The Hill, July 23, 2009

In order to accomplish this systemic regulation, Wolin proposed the creation of a Financial Services Oversight Council, which will include the heads of every major financial agency. This group will report to Congress each year on possible system-wide risks that could arise.

Another proposal Wolin outlined was the creation of the Consumer Financial Protection Agency (CFPA) which would oversee banks and non-banks in order to prevent the marketing of substandard financial practices, like subprime loans.Wolin, Neal, "Consumer protection agency would stop companies’ race to the bottom," The Hill, July 23, 2009

The Network

Wolin works directly under Treasury Secretary Geithner. Others within constant earshot of Geithner include Chief of Staff Mark Patterson and adviser Gene Sperling.

In his first stint at Treasury, Wolin worked under Clinton Treasury Secretary Robert Rubin and Rubin’s successor, Obama’s National Economic Council director Lawrence Summers. While at the CIA, Wolin worked under current Secretary of Defense Robert Gates.

Campaign Contributions

Wolin has donated $20,962 since 2002, all of which has gone to Democratic candidates or Hartford Financial Services insurance company’s political action committee (the Hartford is Wolin’s former employer). In 2007, Wolin donated $2,300 to then-Sen. Hillary Rodham Clinton’s (D-N.Y.) presidential campaign. He switched candidates in 2008, giving Sen. Barack Obama (D-Ill.) $2,300 for his presidential campaign.Center for Responsive Politics

SideBar

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