Senator Chuck Grassley’s floor speech
The problem we face with Mr. Lew’s nomination is that the Senate does not have answers to basic factual questions about Mr. Lew. How can we make an informed choice on his nomination? For example, when Mr. Lew worked at tax-exempt New York University, he was given a subsidized $1.4 million mortgage. Now, Mr. Lew claims that he cannot remember the interest rate he paid on his $1.4 million mortgage that tax-exempt New York University gave him. Does this pass the laugh test? . . .
When Mr. Lew was executive vice president of NYU, the school received kickbacks on student loans from Citigroup C -0.38% . Then, Mr. Lew went to work for Citigroup. When I asked Mr. Lew if he had any conversations with Citigroup about these kickbacks while he was at NYU, he once again “could not recall.” . . .
In the past, the President has railed against the “fat cats” on Wall Street. Today, the President nominates a man who took a bonus from a bailed-out financially insolvent bank. The President has constantly complained about the high cost of college tuition. While Mr. Lew was at NYU, the University increased tuition nearly 40 percent while he was getting paid more than NYU’s President.
In the not so distant past, President Obama called the Ugland House “the biggest tax scam in the world.” Today he nominates a man who invested there. In fact, the President has repeatedly railed against the Cayman Islands and Cayman Islands investments. Mr. Lew is a serial Cayman Islands investor. On his watch, Citigroup invested money there, NYU invested money there, and he invested his own money there.
The WSJ wryly noted Lew’s confirmation as good news:
…there is a silver lining. His support from every Democrat (save Vermont Independent Bernie Sanders) sets a new standard that renders irrelevant a decade of Democratic political campaigns. Such as:
• Investment accounts in the Cayman Islands are no longer evil tax havens. Now they are a form of prudent investor diversification. Tax lawyers everywhere want to thank Senate Finance Chairman Max Baucus for his new forbearance.
• Poorly disclosed executive compensation is no longer a plague on profit-making businesses. It’s now “not uncommon for large organizations,” as New York University explained Mr. Lew’s $685,000 severance payment for leaving the school to join the paupers on Wall Street.
The New York Times reported Tuesday that this severance “payment was not disclosed in the university’s publicly available tax records.” This is true, but it’s odd because NYU told us last week that Mr. Lew’s compensation was reported in the school’s IRS filings. The school’s policy, clearly stated on its website under the headline “No Severance Pay,” says no one who resigns voluntarily receives such a payment. But Mr. Lew did.
• Corporate jet rides? They’re now a necessary perk that former Democratic Treasury Secretary Robert Rubin is allowed to bestow on his political protégés.
• And private lending in the student-loan market—featuring what liberals used to call “kickbacks” to colleges—is now officially acceptable in President Obama’s Washington. Mr. Lew was at NYU when the school made Citigroup, C -0.31% his future employer, its preferred lender in return for a 0.25% share of each loan.
• Perhaps those who still have jobs on Wall Street can also take heart that Mr. Lew’s ascension might mark the end of Washington’s banker-bashing. Having been present at the meltdown of Citigroup’s mortgage investment arm, Mr. Lew will no doubt understand that failure happens in finance and it’s not usually a crime.