Trump to name Goldman Sachs veteran, Gary Cohn, to head National Economic Council
President-elect Donald Trump is expected to name a top Goldman Sachs executive, Gary Cohn, to lead the National Economic Council, handing the Wall Street veteran significant sway over his administration's economic policy.
The council includes the heads of various departments and agencies and works within the administration to coordinate economic policy. As director, Cohn would would be in position to advise Trump as he attempts to fulfill some of his chief campaign promises, including lowering corporate taxes and rethinking U.S. trade policy.
Trump intends to formally name Cohn to the post, which does not require Senate confirmation, but additional details remained unclear, according to a transition official, who spoke on the condition of anonymity and was not authorized to speak publicly. The expected appointment was first reported by NBC News.
In Cohn, Trump would once again be picking a veteran of a New York investment bank that he repeatedly denounced during the campaign. During the campaign Trump argued that Goldman held “total control” over both Democrat Hillary Clinton and GOP rival Ted Cruz and he even released a television ad that flashed an image of Goldman Sachs Chief Executive Lloyd Blankfein and warned of a “global power structure” that was robbing American workers.
But Trump has relied on several Goldman alums for key positions, so far. Steven Mnuchin, a 17-year veteran of the bank, is nominated to be the next Treasury secretary, and Steve Bannon, Trump’s chief strategist, worked on mergers and acquisition deals for Goldman Sachs. Hedge fund manger Anthony Scaramucci began his career at the New York bank and has emerged as one of Trump’s closest advisers on his presidential transition.
Cohn met with the Trump and Vice President-elect Mike Pence at Trump Tower at the end of November, and he would be, by far, the highest-ranking Goldman Sachs executive slated to serve in the Trump administration. Cohn, president and chief operating officer of the bank, was widely viewed as heir apparent at Goldman Sachs, poised to become CEO when Blankfein retired. He has been at the bank since 1990.
As director of the NEC, Cohn would become Trump's chief economic policy adviser. President Clinton established the National Economic Council in the early 1990s, elevating its first director, Robert Rubin -- also a former Goldman banker -- into an influential adviser responsible for overseeing the creation of policies to address the administration’s core economic pledges of job growth and deficit reduction. The post has wielded significant power ever since, with Clinton’s Treasury secretary Lawrence Summers serving in the job under President Obama. Currently, Jeff Zients, formerly head of the Office of Management and Budget, holds the position.
"The NEC director is supposed to ensure there is a serious process for the president to make decisions after hearing the competing views of all relevant economic cabinet members in a fair and coordinated way -- as opposed to governing based on ad hoc information or who was the last person to whisper in their ear,” said Gene Sperling, who served in the role under both Clinton and Obama. “There is no question Trump would benefit from empowering that type of deliberative decision-making process in his White House."
Over more than 20 years, Cohn has run several Goldman Sachs' businesses, including bond and commodities trading. Cohn built a reputation for a “no holds barred” approach at the bank, said Mike Mayo, a banking analyst with CLSA. “He tells it like how he sees it and should hold his own with blue collar and white collar people alike.”
In news inteviews, Cohn has struck a moderate tone on controversial issues such as corporate tax inversion and deregulation. At a conference sponsored by the New York Times last year, he argued for keeping U.S. businesses onshore by creating a “really competitive environment.” He also appeared to take a softer stance on Trump’s campaign promises to roll back the sweeping financial reforms known as the Dodd-Frank Act that were instituted under Obama and reinstate a Depression-era law that separated commercial and investment banking.
"I do think that part of the regulation we've gone through has inhibited our ability to transmit that capital,” Cohn told CNBC last month. “On the other hand, remember U.S. banks today are the strongest banks in the world.... that's a huge competitive advantage for U.S. banks and I don't want to lose that."
Cohn has been a major donor to both parties, according to records from OpenSecrets.org. He supported Florida Sen. Marco Rubio during his presidential bid and he contributed $33,400 last year to the National Republican Congressional Committee. During the 2008 election cycle, he donated $55,500 to the Democratic Senatorial Campaign committee and supported the campaigns of both President Obama and former Secretary of State Hillary Clinton.
Cohn's struggle with dyslexia was featured in Malcolm Gladwell's "David And Goliath." Teachers and classmates wrote him off as an "idiot," Cohn told Gladwell, but he managed to make his way through high school and college. After graduation, he took a job selling window frames and aluminum siding for U.S. Steel.
But, Cohn has said, he had a passion for financial markets. During an impromptu visit to New York, Cohn followed a man exiting the commodities exchange center at Four World Trade Center onto an elevator. He then offered to share a cab to LaGuardia Airport with the banker. By the end of the car ride, Cohn had the man's number and weeks after that a job on Wall Street.
"The one trait in a lot of dyslexic people I know is that by the time we got out of college, our ability to deal with failure was very highly developed," Cohn told Gladwell. "And so we look at most situations and see much more of the upside than the downside. It doesn't faze us. I've thought about it many times, I really have, because it defined who I am. I wouldn't be where I am today without my dyslexia. I never would have taken that first chance."