Revolver Spotlight: Sarah Bianchi

Last week, Bloomberg reported that Biden was likely to name Obama alum Sarah Bianchi to serve as deputy U.S. trade representative. Bianchi, a well known corporate revolver who landed a spot on Robert Kuttner’s “Do Not Reappoint List,” has swung between Democratic administrations, Wall Street, and Silicon Valley since the Clinton years. Her history lobbying against pro-union legislation, including the PRO Act, and working for financial firms that have exacerbated wealth inequality and climate change raise serious concerns about her ability to put the public interest ahead of those of her former clients and colleagues during trade negotiations. 

An often ignored corner of the executive branch, the Office of the U.S. Trade Representative (USTR) in fact has an enormous amount of power to ensure corporations comply with environmental and labor regulations. But for so long, the office has been run by those with deep connections to the private sector that have advocated for trade deals that benefit  their former colleagues, instead of ones that serve the public interest. 

The past two administrations in which Bianchi served were notoriously bad on trade issues. The Clinton administration signed into law the North American Free Trade Agreement (NAFTA), which led to the loss of over 800,000 U.S. jobs in the 10 years after it passed by allowing American companies to relocate production to Mexico. NAFTA not only undermined workers’ rights, disrupted rural economies, and displaced communities abroad, but it also allowed corporations to sue countries over environmental regulations and enforce settlements against taxpayers. 

Obama followed Clinton’s lead, pushing the Trans-Pacific Partnership (TPP), a pro-corporate trade deal that ultimately failed to be implemented. The negotiations surrounding TPPP largely shut out public interest groups, while allowing financial and trade groups a seat at the table. As a result, the final versions of the trade deal would have expanded corporations’ rights to sue governments over environmental and public health regulations. Labor groups criticized the deal, arguing it would have displaced workers and contributed to forced migration, and would exacerbate ongoing human and labor rights violations in participating countries.

With his nomination of Katherine Tai, who has advocated for a worker-centered trade policy, Biden demonstrated his commitment to transforming the trade agenda in the Democratic party. Unfortunately, his choice of Sarah Bianchi to serve as deputy USTR could undermine these efforts:

Before joining Evercore, Bianchi served as Airbnb’s top lobbyist, where she nearly quadrupled the size of Airbnb’s lobbying shop and fought against pro-labor legislation including the Protecting the Right to Organize (PRO) Act. 

• Bianchi lobbied on behalf of Airbnb to pass Republican-backed legislation that would legalize the misclassification of gig workers. 

• During Bianchi’s tenure, Airbnb lobbied to weaken the Protecting the Right to Organize (PRO) Act. The PRO Act would make it easier for employees to form a union and for the NLRB to crack down on union-busting companies.

Bianchi is so deeply tied to the financial industry that she was asked to provide “Wall Street’s reaction” to the Democratic primary debates in 2020. 

Bianchi is currently the head of U.S. public policy and political strategy at investment bank Evercore, a firm that  has advised on some of the biggest mergers in the past decade.

• Evercore’s CEO and Chairman is Ralph Schlosstein, BlackRock founder and Lehman Brothers executive. The firm’s founder and senior chairman is Roger Altman, another Lehman executive and former Blackstone Vice Chair.

• Evercore advised Whole Foods Market on Amazon’s $13.7 billion acquisition of the company.

• Evercore served as Dupont’s advisers during its merger with Dow Chemical. The merger led to DuPont cutting 10% of their staff. A year later, a group of attorneys general filed a federal antitrust probe into the merger.

• Evercore advised Abbott Labs on its acquisition of St. Jude Medical. The Federal Trade Commission (FTC) held that the merger was anticompetitive and forced Abbott to pay a settlement.

After leaving the Obama administration, Bianchi joined BlackRock, one of the world’s largest asset managers. 

• In 2014, Bianchi joined BlackRock as a managing director in the firm’s financial markets advisory group, after leaving the Obama administration.

• At BlackRock, Bianchi worked for Craig Phillips, who served in Mnuchin’s Treasury Department where he helped repeal vital aspects of Dodd-Frank.

• BlackRock CEO Larry Fink served on the steering committee of the Campaign to Fix the Debt, a corporate campaign to implement the recommendations of the Simpson-Bowles commission

• BlackRock has been fined over $15 million since 2000 for investor protection violations.

• BlackRock is one of the world’s biggest investors in nearly every oil company operating in the Amazon and is invested heavily in agribusinesses that are ravaging the Amazon rainforest. Despite promising to fight climate change, BlackRock still has over $17 billion invested in coal plant developers and remains the largest investor in new coal plant development. Environmental groups have consistently pushed BlackRock to divest from the fossil fuel industry to no avail.

After leaving the Clinton administration, Bianchi took a job at Eton Park, a hedge fund founded by Eric Mindich, a close ally of former Goldman executive and Treasury Secretary Robert Rubin. 

• In 1996, President Clinton signed into law the National Securities Market Improvement Act (NSMIA), which deregulated the securities market and allowed hedge funds to expand. Within 7 years of the bill’s passing, the assets of hedge funds like Eton Park increased ten-fold.

• Hedge funds were born out of a loophole in financial regulation legislation passed in the wake of the Great Depression, which exempted them from disclosure requirements and other rules.

• Today, hedge funds like Eton Park often engage in harmful behavior, including stripping corporate assets from or betting against otherwise healthy companies. In the wake of the Puerto Rican debt crisis, hedge funds made fortunes taking advantage of the financial turmoil, buying debt on the cheap and aggressively enforcing payout.

• The risky behavior engaged in by hedge funds magnified the impact of the 2008 financial crisis.

Bianchi opposed efforts to impeach Trump, despite his many abuses of power, and even supported some of his policies.

• In 2019, Bianchi expressed opposition to efforts to impeach Trump, despite his impeachable offenses.

• At a Third-Way event, Bianchi applauded Trump’s opportunity zone legislation. Research has revealed that opportunity zones overwhelmingly benefited the rich.

PHOTO: “The Biden Institute’s Sarah Bianchi” by Third Way is licensed under CC BY-NC-ND 2.0