Sen. Elizabeth Warren challenged the credentials of President Barack Obama's nominee for a top Treasury job, saying a "well-oiled" revolving door between Wall Street and its regulators favors banks' interests at the expense of consumers.
Antonio Weiss, the global head of investment banking at Lazard Ltd. who has specialized in international mergers and acquisitions, lacks experience to be undersecretary for domestic finance, Warren said in a speech today in Washington. She criticized Obama for nominating an executive who has worked on corporate tax-inversion deals, which the administration is attempting to curb.
"Not every person who swoops in through the revolving door should be offered a top job without some serious cross- examination," she said in prepared remarks at an event organized by Americans for Financial Reform, the Economic Policy Institute and the Roosevelt Institute. "Qualifications matter, and Weiss doesn't have them."
Warren, a Massachusetts Democrat, is opposing the nomination partly because she said his selection would perpetuate close ties between the government and banks. She cited figures showing the amount of time and money Goldman Sachs Group Inc., JPMorgan Chase & Co. and other financial companies spend trying to influence regulators in Washington.
As undersecretary, Weiss would coordinate policies on banking, capital markets and regulation. The undersecretary also works on implementation of the Dodd-Frank financial law. One of his main responsibilities is managing the issuance of the country's debt.
Warren said Weiss's banking expertise doesn't fit with the position, calling him "a corporate dealmaker, not a bond trader."
Warren has been Weiss's most vocal opponent as he awaits Senate confirmation. Senator Bernie Sanders, a Vermont Independent, and Richard Durbin, an Illinois Democrat, have also questioned the nomination.
What remains to be seen is whether Weiss's opponents can rally enough support to block the nomination, especially as supporters and former Treasury officials say Weiss's years in finance make him a well-qualified candidate for the job.
"It's a job that has a fairly wide remit, and there's no one who's going to have a perfect resume for it," Randal Quarles, managing director at the Cynosure Group in Salt Lake City, Utah, and former Treasury undersecretary in the George W. Bush administration, said in an interview shortly after Weiss's nomination. "He comes pretty close."
Weiss joined Lazard in 1994 and from 2001 to 2009 worked in various roles in Paris, an important hub for the Hamilton, Bermuda-based company. He has had a hand in many of the largest and highest-profile mergers and acquisitions of the past six years, some involving multibillion-dollar takeovers of major U.S. consumer companies.
Lazard advised on three of the four most recently announced U.S. inversions, in which American companies relocate to countries with lower taxes. Those include Burger King Worldwide Inc.'s planned adoption of a Canadian tax address through a takeover of Tim Hortons Inc.
"The administration undercuts its own opposition to this practice by nominating someone who was involved in a high- profile, cross-border inversion," Warren said.
White House officials have said Weiss will support the administration's efforts to curb inversions, which Obama says erode the U.S. corporate tax base. Lazard didn't work directly on the tax aspects of the Burger King-Tim Hortons deal, people familiar with the situation have said, and the companies have said the deal makes strategic sense beyond its tax benefits.
Warren said today that "no matter how many Burger King executives line up in the newspapers to say they had other motives, this was an inversion deal and Mr. Weiss was right in the middle of it."
Warren herself has been censured for challenging Weiss's nomination. New York Times columnist Andrew Ross Sorkin has written that "Ms. Warren's wrath is misdirected," while the Wall Street Journal opinion section carried a Nov. 23 column titled "Weiss for Treasury Secretary."
"The populists' case against Mr. Weiss so far amounts to a grab-bag of symbolism and epithets, not a rationale," the Washington Post editorial board said Nov. 30.
Weiss, 48, is also finding support elsewhere on Capitol Hill. Senator Orrin Hatch of Utah, a Republican who is poised to become chairman of the committee responsible for the nomination, has voiced support for the candidate, contingent on a review of his paperwork.
"Subject to the paperwork, I'm probably going to be for him," Hatch said in a brief interview last week. "I think the president should have whoever he chooses, and this man has a tremendous amount of experience."
Warren today added Weiss's pay package to her list of critiques. Weiss reported compensation of $15.4 million over almost two years as global head of investment banking at Lazard Ltd., his financial disclosure showed. He will also pick up unvested income ahead of schedule if confirmed for the job, totaling about $16.2 million in stock and as much as $5 million in deferred pay.
