To win high office, maybe hide your banking past
Banking experience used to look good on a politician’s resume.
A career in the banking industry showed that a candidate was comfortable with numbers and making difficult financial decisions. Since the financial crisis, however, such experience has often been associated with the negative aspects of the last recession.
At least one candidate has chosen to downplay his banking career as he runs for office this year.
Phil Murphy, a Democrat vying to become New Jersey’s governor, never mentions his 23 years at Goldman Sachs in the biography posted on his campaign’s website. The closest he gets to highlighting his investment banking roots is when he says a stint at a “major international business” taught him how “economies grow and create jobs.”
The approach could be tied to the state’s recent political history. The last banker to serve as New Jersey's governor — former Goldman Sachs CEO Jon Corzine — failed to win re-election and later ran MF Global, a futures brokerage firm that imploded in the wake of the financial crisis.
“To me, it’s really all about Corzine,” said Chris Russell, a political consultant in New Jersey who advised a Republican gubernatorial candidate who hoped to run against Murphy.
A spokesman for Murphy’s campaign did not respond to multiple phone calls seeking comment. Ricky Diaz, a spokeman for Republican candidate Kim Guadagno, claimed that Murphy is "running away" from his background, in large part, because of Corzine. Goldman Sachs spokesman Andrew Williams declined to discuss Murphy’s decision-making, though he said the candidate “had a great career here.”
Murphy's candidacy reveals a big challenge for bankers who want to dive into politics. Many factors matter, including party affiliation, location and the issues involved in a particular race.
A banker’s specific background is another key factor, said Terry Sullivan, a partner at Firehouse Strategies in Washington and a former manager of Sen. Marco Rubio’s presidential campaign.
Most Americans regard local bankers positively, Sullivan said. In contrast, executives affiliated with a larger bank or a big investment bank might strugggle to win people over.
“An executive at a Fortune 500 company has less of a personal connection,” Sullivan said, adding that it could be seen as a career in “big business.”
A “perception difference” exists between community banking and Wall Street, said Matt Williams, a Nebraska state senator and former CEO of the $142 million-asset Gothenburg State Bank. Still, ongoing scandals haven’t helped the industry put the financial crisis completely in the past.
“We have continued over the years to have some of our larger banks stumble with public relations issues,” added Williams, who is also a former chairman of the American Bankers Association. “That doesn’t help us rebuild trust and confidence.”
The 2008 crisis continues to influence opinions of bankers nearly a decade after its peak. A Gallup poll conducted in late August found that only 43% of respondents viewed the banking industry positively, while 30% still had a negative opinion of it.
There is some hope for bankers. The Gallup results are the best they’ve been since 2007.
Several former bankers have successful political careers, even after the crisis.
Sen. Pat Toomey, R-Pa., is a former trader with Chemical Bank. Sen. Blaine Luetkemeyer, R-Mo., and Rep. French Hill, R-Ark., are ex-bankers.
Banking experience was a plus for Steve Wilson, former CEO of the $1.3 billion-asset LCNB Corp., when he was appointed earlier this year to fill a vacancy in the Ohio state Senate. Wilson said his former career gave him a leg up in areas such as economic development and job creation.
“That really played well and helped me get the position,” Wilson said, adding that he plans to run for re-election next year.
There is a fledgling effort at the American Bankers Association to encourage more members to run for office. The association will hold its first training session next month in hopes of getting more bankers politically active.
While the decision is up to the individual candidate, the ABA is pleased when people underscore their banking experience, said James Ballentine, the association’s executive vice president for congressional relations.
Bankers running for office shouldn't be shy about their background or, as the case may be, their wealth, political consultants said.
“Mitt Romney kind of tried to distance himself from his wealth in many ways” when he ran against Barack Obama in 2012, Sullivan said, noting that the Republican nominee took a lot of heat for the decision. Donald Trump, in contrast, boasted about his real estate career during his successful presidential run.
“Figure out a way to embrace what made you you,” Russell said.