User:WWB Too/Robert Rubin

Robert Edward Rubin (born August 29, 1938) is an American investment banker who served as the 70th United States Secretary of the Treasury during the Clinton administration. Prior to his government service, he spent 26 years at Goldman Sachs, eventually serving as co-senior partner and co-chairman. He left Goldman Sachs in 1993 to become Assistant to the President for Economic Policy and the first Director of the White House National Economic Council prior to his appointment as Treasury secretary.

Rubin is credited as a major force behind Clinton-era economic prosperity, including the 1993 Deficit Reduction Act and Balanced Budget Act of 1997. However, critics of Rubin have since argued that bank-friendly policies he advocated contributed to the financial crisis of 2007–2008.

His post-government roles included serving as a director and senior counselor of Citigroup, where he performed advisory and representational roles for the firm.

As of 2021, he is active in several organizations and is a senior counselor at an investment banking advisory firm.

Early life and education
Rubin was born on August 29, 1938, in New York City, to Jewish parents Sylvia (née Seiderman) and Alexander Rubin. Rubin moved to Miami Beach, Florida, at an early age and graduated from Miami Beach High School. In 1960, Rubin graduated with an A.B. summa cum laude in economics from Harvard College. He then attended Harvard Law School for three days before leaving to see the world. He later attended the London School of Economics and received an LL.B. from Yale Law School in 1964.

Early career
Rubin was an attorney at the firm of Cleary, Gottlieb, Steen & Hamilton in New York City from 1964 to 1966 before joining Goldman Sachs in 1966 as an associate in the risk arbitrage department. He later ran their stock and bond trading departments and became co-chairman in 1990.

Rubin served as New York finance chairman for the Walter Mondale presidential campaign in 1984, and headed the host committee for the 1992 Democratic National Convention in New York.

He served on the board of directors of the New York Stock Exchange, the New York City Partnership, Carnegie Corporation of New York, President Jimmy Carter's Advisory Committee for Trade Negotiations, the U.S. Securities and Exchange Commission Market Oversight and Financial Services Advisory Committee, the Mayor of New York's Council of Economic Advisors and Governor Mario Cuomo's Council on Fiscal and Economic Priorities for the State of New York.

National Economic Council
From January 25, 1993, to January 10, 1995, Rubin served in the White House as Assistant to the President for Economic Policy. In that capacity, he directed the National Economic Council (NEC), which Clinton created after winning the presidency. The National Economic Council enabled the White House to coordinate closely the workings of the Cabinet departments and agencies on policies ranging from budget and tax to international trade and alleviating poverty. The NEC coordinated policy recommendations going into the President's office and monitored the implementation of the decisions that came out. Robert S. Strauss credited Rubin with making the system work. "He's surely the only man or woman in America that I know who could make the NEC succeed," Strauss said in 1994. "Anyone else would have been a disruptive force, and the council wouldn't have worked."

1993 Deficit Reduction Act
Rubin encouraged Clinton to focus on deficit reduction and he was "one of the chief architects" of Clinton's 1993 Deficit Reduction Act plan. Supporters said the Act helped create the late 1990s budget surplus and strong economic growth, while opponents noted it raised taxes. As officials deliberated the deficit reduction plan, Rubin advocated for tax increases on those in the upper-income tax bracket. The Baltimore Sun said that the budget deal "was critical" and "convinced nervous bond traders that the new Democratic president was serious about the deficit, lowering long-term interest rates, spurring economic growth and, ultimately, helping to balance the budget."

Secretary of the Treasury
Clinton nominated Rubin as Treasury secretary in December 1994. On January 10, 1995, Rubin was sworn in as the 70th United States Secretary of the Treasury after the U.S. Senate confirmed him in a 99-0 vote. Rubin's tenure with the Clinton administration, especially as the head of Treasury, was marked by economic prosperity in the U.S. Rubin is credited as one of the main individuals behind U.S. economic growth, creating near full-employment and bullish stock markets while avoiding inflation. From the time he joined the White House until he announced his resignation from Treasury in 1999, U.S. unemployment fell from 6.9 percent to 4.3 percent; the U.S. budget went from a $255 billion deficit to a $70 billion surplus, and inflation fell. Rubin was succeeded in early July 1999 as Treasury secretary by his deputy, Lawrence Summers.

According to CNN Money, Rubin was "one of the architects of the Clinton administration's economic policy, and is often credited—along with Federal Reserve Chairman Alan Greenspan—for the booming eight-year economic expansion, the second-longest in U.S. history".

Senator Chuck Hagel (R-NE) called Rubin "an ideal public servant who put policy before politics." At the time of Rubin's resignation, Clinton called Rubin the "greatest secretary of the Treasury since Alexander Hamilton."

1990s international crises
Upon being sworn into office as Treasury secretary in January 1995, Rubin was confronted with the Mexican peso crisis, which threatened to result in Mexico defaulting on its foreign obligations. President Bill Clinton, with the advice of Rubin and Greenspan, provided $20 billion in U.S. loan guarantees to the Mexican government through the Exchange Stabilization Fund. Mexico recovered and the U.S. Treasury made a $580 million profit as a result of the loan agreement.

In 1997 and 1998, Rubin, Greenspan, and Deputy Treasury Secretary Summers worked with the International Monetary Fund and others to promote U.S. policy in response to financial crises in Russian, Asian, and Latin American financial markets. On the cover of its February 15, 1999 edition, Time Magazine dubbed the three policymakers "The Committee to Save the World".

Balanced budget agreement
Since the early days of the Clinton administration, Rubin touted a balanced budget and a strong dollar as a way for the Fed to lower interest rates. He also argued that a balanced federal budget's broad benefits to society outweighed concerns that one group could benefit more than others. Rubin was the Clinton administration's chief negotiator with a Republican-controlled Congress on the balanced-budget deal. The Balanced Budget Act of 1997 has been referred to as the "capstone" of Rubin's tenure as Treasury secretary.

Regulation of derivatives
In 1998, Rubin and Federal Reserve chairman Alan Greenspan opposed giving the Commodity Futures Trading Commission (CFTC) oversight of over-the-counter credit derivatives when this was proposed by Brooksley Born, then head of the CFTC. Rubin and other senior officials recommended Congress relieve the CFTC of regulatory authority over derivatives in November 1999. Over-the-counter credit derivatives were eventually excluded from regulation by the CFTC by the Commodity Futures Modernization Act of 2000.

Arthur Levitt Jr., a former chairman of the Securities and Exchange Commission, has said in explaining Rubin's strong opposition to the regulations proposed by Born that Greenspan and Rubin were "joined at the hip on this. They were certainly very fiercely opposed to this and persuaded me that this would cause chaos." However, in Rubin's autobiography, he notes that he believed derivatives could pose significant problems and that many people who used derivatives did not fully understand the risks they were taking. In 2008, The New York Times reported that the proposal in 1997 would not have improved oversight of derivatives. Rubin said the financial system "could benefit from better regulation of derivatives". However, "the politics would have made this impossible," he said. Rubin said he had been concerned about derivatives' potential to create systemic risk since his time at Goldman Sachs.

In an interview on ABC's This Week program in April 2010, former President Clinton said Rubin was wrong in the advice he gave him not to regulate derivatives, which was by then seen as one of the underlying causes of the 2007–08 financial crisis. Clinton adviser Doug Band later said Clinton "inadvertently conflated an analysis he received on a specific derivatives proposal with then-Federal Reserve Chairman Alan Greenspan's arguments against any regulation of derivatives". He said Clinton still wished he had pursued legislation to regulate derivatives while confirming that he still believed he had received excellent advice on the economy and the financial system from Rubin and others during his presidency.

Repeal of Glass–Steagall Act
Rubin and his deputy Lawrence Summers loosened financial industry underwriting guidelines and "played a role in arranging the compromise that led to the repeal of the Glass–Steagall Act". The Depression-era law separated investment banking from the retail side of banking, but in the 1990s, "commercial banks and investments moved closer together, eroding the Glass–Steagall Act legal restrictions enacted in the 1930s". Rubin supported the idea of repealing Glass–Steagall but had concerns that it could empower the Federal Reserve at the expense of the Treasury Department. Glass–Steagall was eventually repealed under his successor. Some critics claim that the repeal of the Glass–Steagall was a key factor in the 2008 financial crisis. In March 2010, Rubin told the Financial Crisis Inquiry Commission that Glass–Steagall was ineffectual in practice. "By the time we rescinded it, there were no restrictions left in it at all except for the insurance underwriting, which had no relevance to anything that has happened since then," he testified.

Urban policy
Rubin was a leading advocate for investment in distressed rural and urban communities in the Clinton administration, from his time with the NEC, leading the effort to expand the Community Reinvestment Act, to his time at Treasury, where he advocated for more community development financial institutions (CDFI) to invest in inner cities and increase the CDFI Fund. Addressing the needs of the urban poor was a top priority for Rubin during his tenure in the Clinton administration. Rubin also assisted with the Clinton administration's plan to increase empowerment and enterprise zones across the U.S. The initiative offered tax breaks for businesses investing in those zones.

Local Initiatives Support Corporation
Upon leaving the Clinton administration, Rubin joined the board of the Local Initiatives Support Corporation (LISC), the nation's leading community development support organization, as chairman. Reflecting on his decision to join an institution devoted to bringing economic activity to neglected areas of the country, the Chicago Tribune said Rubin favored using business investment as a way to fight poverty in urban and rural areas.

Citigroup
Rubin joined Citigroup in 1999 as chairman of the executive committee of the board. Rubin briefly became chairman of Citigroup's board of directors from November 2007 to December 2007.

According to The New York Times, Rubin's role at Citigroup focused on meeting with clients and government and business leaders, bringing in business, and serving as a sounding board to bank leadership. As the Times reported in 2007, Rubin "has said publicly since he came to Citigroup in 1999 that he had no interest in running the bank". The Wall Street Journal reported Rubin joined Citigroup as a board member and as a participant "in strategic managerial and operational matters of the Company, but [...] no line responsibilities". The newspaper called this mix of oversight and management responsibilities "murky".

In 2001, with the troubled Enron, a major client of Citigroup, facing a credit ratings downgrade, Rubin called a ranking Treasury Department official, unsuccessfully seeking the Bush Administration's help in forestalling the downgrade. A subsequent staff investigation by the Senate Governmental Affairs committee cleared Rubin of having done anything illegal. Rubin later maintained that he had acted both as a Citigroup executive protecting his company's position and as a former Treasury official concerned about the impact that Enron's failure might have on the larger economy. Rubin rejected criticisms of a possible conflict of interest and has said that if faced with the same choice, he would do it again.

Following the 2008 financial crisis, critics argued Rubin increased risk-taking at Citigroup, thereby exposing the bank to greater losses, and that economic policies he promoted as Treasury secretary exacerbated the situation. According to The Wall Street Journal, Rubin has stated that "he wasn't alone in failing to foresee the severity of the crisis that would emerge". Other industry observers criticized the lack of clarity about Rubin's role within the bank. The federal government spent $45 billion to acquire a stake in Citigroup and bail out the bank in 2008 through the Troubled Assets Relief Program. Citigroup repaid $20 billion of the bailout money in December 2009 and the Treasury sold its remaining stake one year later, for a total net profit of $12 billion.

In December 2008, investors filed a lawsuit contending that Citigroup executives, including Rubin, sold shares at inflated prices while concealing the firm's risks. The lawsuit alleged that Citigroup and some executives concealed the risks of billions of dollars of financial instruments and artificially boosted the company's stock. The lawsuit was settled in 2012, with Citigroup denying any wrongdoing.

In a December 2009 Newsweek article, Rubin described the extraordinary combination of circumstances that led to the global financial crisis, including market excesses, low interest rates, a massive increase in the use of complex derivatives, misguided AAA ratings, stagnant median real wages, abusive mortgage practices, and the over-leveraging of financial institutions, among many other factors.

Rubin resigned from Citigroup in 2009, writing at the time that his "great regret is that I and so many of us who have been involved in this industry for so long did not recognize the serious possibility of the extreme circumstances that the financial system faces today". Rubin received total compensation of $126 million from Citigroup between 1999 and 2009.

Other work
Rubin is a co-founder and member of the advisory council of The Hamilton Project, an economic policy think tank within the Brookings Institution. He is co-chairman emeritus of the Council on Foreign Relations, a trustee of Mount Sinai Health System, and serves on the advisory board of the Black Economic Alliance. Additionally, Rubin is a senior counselor at Centerview Partners.

In 2001, Rubin received an honorary doctoral degree from Harvard University, and on July 1, 2002, he became a member of Harvard Corporation, the executive governing board of Harvard University. He served as a member of the Harvard Corporation board until June 2014 and continues to serve on its finance committee.

Rubin was a member of the Africa Progress Panel (APP), a group of ten distinguished individuals who advocated for equitable and sustainable development in Africa. Rubin also served on the Global Citizenship Commission, convened by former British Prime Minister Gordon Brown, which reexamined and proposed an update to the United Nations' 1948 Universal Declaration on Human Rights.

Rubin's memoir, In an Uncertain World: Tough Choices from Wall Street to Washington, co-written by Jacob Weisberg, was a New York Times bestseller as well as one of Business Week's ten best business books of 2003.

Policy views
Rubin is associated with fiscal discipline, according to Fortune. He is socially liberal. Rubin is an advocate for a balanced budget and regulatory restraints. Rubin is credited with developing the strong dollar policy that has been a cornerstone of U.S. economic policy since his tenure at Treasury. Rubin has supported progressive tax measures and expanding earned income tax credits to benefit low- and middle-income Americans. Rubin has opposed tax cuts that disproportionately benefit high earners, including those by Presidents George W. Bush and Donald Trump. He also "advocates career retraining for out-of-work Americans and a path to citizenship for undocumented immigrants so companies don't have to hire as much abroad".

In April 2016, Rubin was one of eight former Treasury secretaries who called on the United Kingdom to remain a member of the European Union ahead of the June 2016 Referendum. While it was entirely the UK's decision, Rubin and the others said the U.S. had a "critical interest" in the referendum's outcome.

Climate change
Among Rubin's policy interests is climate change. In 2014, Rubin served as a member of the U.S. Climate Risk Committee, which oversaw the development of an analysis of the economic risks of climate change in the United States. In an address at the Climate Leadership Conference on March 4, 2015, Rubin spoke about the economic effects of climate change and the costs of inaction. Calling climate change "the existential threat of our age," he called for the adoption of three proposals—revising estimates of the gross domestic product to reflect climate change externalities, disclosure to investors by companies of the costs of carbon they emit that they might be required to absorb, and including in the U.S. government's fiscal projections the future costs of dealing with climate change—to help catalyze a more active response to climate change risks. He first outlined these proposals in a Washington Post op-ed column titled "How Ignoring Climate Change Could Sink the U.S. Economy."

Rubin has suggested companies should be forced to disclose the threats that climate change poses to their assets and profits. In 2016, former Treasury secretaries Rubin, Henry Paulson, and George Shultz, members of the climate research group the Risky Business Project, penned a letter to the United States Securities and Exchange Commission, urging regulators to manage financial disclosures regarding climate change.

Recognition
On January 8, 2001, President Clinton presented Rubin with the Presidential Citizens Medal.

Universities that have conferred honorary degrees upon Rubin include Harvard, Yale University, New York University, Columbia University, Dartmouth College, and University of Pennsylvania.

Personal life
In the Center for Arts and Culture's 2007 board of directors profile page, the profile of Judith O. Rubin read she is married to Robert Rubin and they have two grown sons together, James and Philip.