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Blog Post | April 28, 2020

Ted Kaufman Hates The Revolving Door. Now He Must Do Something About It.

2020 Election/TransitionLarry SummersRevolving Door

Joe Biden announced at a virtual fundraiser on Monday that Ted Kaufman, his long-time advisor and eventual successor as Delaware Senator, is leading his presidential transition team. This is good news for opponents of the revolving door between the federal government and corporate America. Since leaving Congress, Kaufman has frequently decried corporate capture of Washington and called for substantive good-government reforms.

Kaufman’s focus on corruption and the influence industry should come as no surprise to those familiar with his short tenure as a Senator. As Congress coped with the 2008 financial crisis and subsequent Great Recession in 2009 and 2010, Kaufman was a leading advocate for both serving justice to the financiers responsible and, more importantly, instituting regulatory reforms to prevent such a crisis from happening again. He was an initial co-sponsor of a bill that increased resources for prosecuting financial fraud, and fought to amend the Dodd-Frank Act to include effective limits on how large banks could grow. Kaufman made more of the right kind of financial sector enemies in two years as a lameduck Senator than most famous long-serving Senators make in their entire career. 

The fact that this amendment and other common-sense reforms were killed by the financial industry’s influence in Washington clearly disturbed Kaufman, even up to this day. In a Forbes blog post in 2013, while President Barack Obama was still in office, Kaufman decried Obama’s selection of Wall Street veterans for his top economic policy jobs. “President Obama, despite his promise of “change we can believe in,” concentrated only on stabilizing the financial system and supporting our major banks,” Kaufman wrote. 

He specifically called out National Economic Council Director Larry Summers (whom we know is currently advising the Biden campaign), as well as Treasury Secretary Tim Geithner, SEC Chair Mary Shapiro and enforcement head Rob Khuzani, Justice Department official Lanny Breuer and many more. 

The blog shows a sophisticated understanding of how federal bureaucracies — including sub-cabinet jobs deep in the weeds of the system — get captured by the very industries they are created to regulate. Kaufman also displays an all-too-rare political bravery by naming names and criticizing specific actions of then-sitting officials. 

That’s not his only public stance against corruption. In 2018, Kaufman told the Washington Post “The revolving door is a gigantic problem for Congress — far too many people are leaving jobs in Congress where they were working on legislation that affected major corporate interests to go work for those corporate interests.”

Earlier that year, he wrote in Delaware Online that Washington was “rife with conflicts of interest,” citing his own experiences on an SEC advisory committee packed with representatives of the industry it was meant to oversee. Kaufman’s firsthand experience with the web of sub-committees and advisory boards that make up the federal bureaucracy make him a well-qualified chairman for any presidential transition. His evident disgust with the corruption that frequently accompanies this bureaucracy makes him ideal.

It’s not easy for a Delaware Senator to be a vocal advocate for financial reform and anti-corruption measures. The state is famously home to many credit card companies, and is a notorious tax haven. This enriches corporate executives, who in turn tend to enrich Delaware politicians in order to keep things as they are. For a major state leader to publicly oppose the sort of back-room double-dealing that his fellow political operatives abide by is courageous.

We hope that Kaufman brings that same courage to his work preparing for a potential Biden transition. If he truly cannot stand the conflicts of interest, revolving doors, and regulatory capture of Washington, then he currently holds perhaps the single most powerful job to do something about it. 

Kaufman can clean up a potential Biden administration by selecting “beach-head teams” — the Democratic officials who are sent into each department and agency months before a presidential election, in order to suss out the current state of the bureaucracy should their candidate win in November — who are motivated not by private interests, but the public good. There’s no shortage of qualified and passionate Democrats eager to work with him, should he simply look beyond the usual BigLaw firms and lobbying teams that tend to cozy up to transition chairs. 

From his record, we have reason to think Kaufman will shrug off these sleazy appeals. We look forward to seeing him prove it.

2020 Election/TransitionLarry SummersRevolving Door

More articles by Max Moran

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