Just three weeks after he announced his political comeback, Eliot Spitzer is leading the race for New York City Comptroller, and that’s got some people worried. Now, according to The New York Times, an unusual coalition of business leaders, union leaders and feminist groups who normally don’t agree on many issues are working together to defeat Spitzer’s candidacy. They hope to spend at least $1.5 million on advertising against Spitzer before the Democratic Primary on September 10. Whoever wins the primary usually wins the November election.
It’s no surprise that business leaders oppose the former so-called Sheriff of Wall Street who, as New York State Attorney General, took on investment banks for inflating stock prices during the dot.com bubble and former NYSE Chairman Richard Grasso for an excessive pay package.
But a coalition of four major unions in the city is also opposing Spitzer because he’s running ahead of their candidate -- former Manhattan Borough President Scott Stringer. And members of the New York City Chapter of the National Organization for Women are opposing Spitzer for the behavior that ended his term as New York Governor after just a little more than a year -- patronizing prostitutes.
The Daily Ticker’s Aaron Task caught up with the candidate at his NYC office to ask him: Should Wall Street be afraid?
Spitzer said Wall Street firms and workers shouldn’t fear him so long as they play by the rules of capitalism, as his family has done in the world of real estate and ordinary people do when they invest in mutual funds.
“We’re trying to make sure the markets work,” said the author of the new book Protecting Capitalism Case by Case. “True capitalists understand the boundary lines, understand too much leverage can be dangerous… [that] playing with other people’s money without due regard to fiduciary obligations is problematic.”
Asked whether Wall Street has learned its lesson from the financial crisis that precipitated the Great Recession, Spitzer said “The question isn’t did we learn it [lesson] last week or learn it today. It’s will we remember it six months from now?”
He added that the politicians “haven’t done what we need to have done structurally. We still have too big to fail, too big to manage, too big to prosecute... though important steps” have been taken, including the Volcker rule (which separates banks’ proprietary trading from insured banking activities) and increased capital requirements.
On the U.S. attorney’s office criminal charges against SAC Capital Advisors for insider trading, Spitzer said he read the indictment and it paints “a portrait of an enterprise that condoned and… almost promoted insider trading… It read to me like the organized crime cases I used to make.” Indeed, one of the biggest cases Spitzer prosecuted early in his career targeted the Gambino crime family’s control of the trucking and garment industries in Manhattan. Two of its leaders were charged with antitrust violations, pled guilty, paid millions of dollars in fines and agreed to leave the trucking and garment business. They did however avoid jail.
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