Fixers (12 page)

And rising poll numbers.

Finally, he said: “Chauncey, I’ll level with you. If we got an injection of $75 million right now—even half of that—we could win this darn thing! We’ve got the right candidate, we’ve got the right message: all we need to be able to do is get it out, to secure funding sufficient to build out the brand and the campaign organization. If you know where I can get that kind of money, the candidate will kiss your ass in a Macy’s window at high noon.”

“That won’t be necessary,” I said, then decided it was time to bring out the net. “Homer,” I said, using a voice full of fellow feeling, “I have to come clean with you. Our bumping into each other at the Grove wasn’t entirely a matter of chance.”

He grinned. “You know, I’m just starting to pick up on that. For someone who professes to disdain politics, you’re a pretty sharp operator.”

“Flattery will get you everywhere,” I responded. “Now listen: there are people—wealthy people, influential people—who feel very strongly that if there’s a crisis, Mrs. Clinton’s not the person they want dealing with it. They’ve deputized me to come and talk to you.”

“I don’t suppose you’re willing to disclose who these people might be?”

My turn to grin. “You don’t suppose correctly,” I replied.

“Why don’t you tell me exactly what you have in mind?” We were on the same wavelength.

“Happily,” I said. “I’ve already described to you the crisis my people see coming. Some of them think it might even compare to 1929. You know those World War II documentaries on PBS that show people picking through the rubble of Berlin in 1945? Or London after the Blitz? That’s what they think this economy’s going to look like.”

“Jesus.”

“I agree. OK, let’s take as a given that the shit hits the fan sometime next year. If it happens before November ’08, the likeliest scenario, that’ll be on Bush’s watch, and this administration’s immediate problem. Coming on top of Iraq and Katrina, what this’ll do to Bush’s historical rating won’t bear thinking about. Buchanan’ll look like Lincoln next to Forty-Three. You with me?”

He nodded. “Go on.”

“Now: here’s the thing. You can bet they’ll act quickly, because the people who’ll be running the show from the Treasury are Wall Street types. You know: invest and then investigate. Which means they’ll try to resolve over a couple of weekends a disaster that’s been decades in the making. They don’t know how to think long-term, or in terms of the wider community, what you and I think of as Main Street. The first thing on their minds will be to save Wall Street from the consequences of its greed and folly—and Washington’s—so they’ll try to fix the mess by throwing the taxpayers’ money at it. They won’t do what they should do, which is to keep essential overnight credit flowing, and throw the rest of the subprime and other garbage into a kind of global cesspool and let the rats fight it out. They should close down or nationalize the busted banks after segregating insured deposits, fire their boards, and put the bums who brought us this mess in handcuffs, along with the CEOs who let them get away with it. Let the banks’ stockholders take the hit. But this isn’t what’ll happen, which is why the next president will have a problem.”

I thought I got that little rehearsed speech out very glibly. You would have even thought I’d written it myself, although the words were Mankoff’s. Orteig seemed impressed. “I think you’d better explain,” he said.

“It’s very simple. People on the Street will tell you that it takes roughly twice as long to get out of a crisis than to get into one. This means whoever gets elected a year from now is still going to have to deal with the problem. Whatever the GOP puts in place will be hard to get out of. But what will still be possible is for whoever enters the White House in 2009 to take it out of Wall Street’s hide the way FDR did back in ’33. That’s when we got Glass-Steagall and all the other protective regulation that Phil Gramm and his patrons got rid of under Clinton.”

“I see.”

“And that brings me to your candidate. Let’s start with your guy’s declaration that he’s the candidate of change. Change Washington, change the way the country functions, and so on. And change equals reform, agreed?”

Orteig nodded.

“The question, then, is: what kind of reform? Or, to put it another way, reform of what?”

“Wall Street, I should think.”

“That’s our guess. But reform needs to be implemented coolly and thoughtfully, not against a background chorus of ‘off with their heads!’ with lynch mobs gathering on Capitol Hill and tumbrels rolling down Wall Street—but when the next president is inaugurated, he or she will be under pressure to set policy simply to satisfy the mob’s or the media’s call for necks for the guillotine. But lynch mobs, guillotines, and heads on pikestaffs are hardly what the economy’s going to need at that point.”

“I take your point, but if there’s a crisis, you can hardly expect a candidate not to exploit it politically.”

“Of course. The people I’m speaking for don’t much care what the candidates think and say about Wall Street up to the election. You tell the girl what she wants to hear in order to get her into bed, but that’s not the same as a marriage proposal. What musn’t happen is that we end up with a president-elect and a bunch of advisers who try to put an anti–Wall Street, anti-business campaign rhetoric into actual practice. That would be a disaster for the country. For a new administration to take office with a policy based on retribution and punishment would be a terrible mistake. Bad for Wall Sure, to be sure, but worse for the country. It’d be a case of starving the patient just when he needs to be fattened back to health. The people won’t see it that way, of course, but off the evidence of the past twenty years they haven’t exactly shown themselves to be capable stewards of their own best interests.”

“The public won’t stand to see Wall Street bailed out.”

I grinned. “What if they have no say in the matter? Besides, hanging Wall Street out to dry shouldn’t be at the top of any serious president’s policy want-list. There’s health care. There’s Iraq and Afghanistan. The Main Street economy will require a bit of lip service, and maybe even some real money. There’s China, Latin America, the drug war, other big stuff. More pressing and painful issues than putting a few people in Armani into minimumsecurity prisons. Your man is an inspirational type. If he captures the electorate’s fancy and gets elected, they’ll cut him some slack, no matter what he may have promised during the campaign. And what you and I are really here to discuss is how to make sure there
is
a campaign in which he can make promises.”

“What about the media?”

“The media? Come on! The last time the media made a real difference in the way things get done in Washington was Watergate, and that was what—almost forty years ago?”

He pondered that. I decided to switch to sympathy mode.

“Look, Homer. I’m no fan of a lot of the stuff I see going down on Wall Street. But I do appreciate that if there’s a crisis it’s important that the markets see the prospect of stability for as long as the big banks need to get their houses back in order. If a new administration comes in having made all sorts of wild reform promises about throwing the passengers in the Bush lifeboat to the sharks—and then keeps those promises—the result could be chaos.”

Orteig smiled and shook his head as if laughing at some inner joke. “I see,” he said. “God help me if I ever find myself pitted against you in an election.”

“You flatter me,” I said. “Here’s the thinking of the people who sent me to talk with you. If they could be privately—and I emphasize ‘privately’—assured by you that in the eventuality your man is elected, his economic team will consist of men and women who understand the importance of functioning capital markets and banking institutions to the overall welfare of the nation, they’re prepared to commit up to $75 million to the campaign.”

He whistled softly, then nodded to himself. Then he fixed his gaze on mine and asked, “And what if he doesn’t get the nomination?”

“If he doesn’t get the nomination, obviously the money’s down the drain. Nothing ventured, nothing gained.”

“I see. As far as an economic team, I trust you have certain people in mind?”

“I do.” No more playing around, I thought. I reached into my jacket pocket and took out an index card similar to the one Mankoff had shown me at Three Guys, on which I’d printed four names.

Orteig reached for it, but I held it back, and said, “Before I show it to you, one thing must be understood. The people whose names are on this card have zero knowledge of what I’m proposing to you, and it has to stay that way. We’re making a Pavlovian bet here.
Ring the right ideological bell, and these animals can be counted to salivate, if you get my meaning. A sort of conspiracy by reflex.”

Then I handed him the card.

He studied it, then looked up. “These names aren’t going to go down very well with our base,” he said. “Especially Harley Winters. He’s a living symbol of crony capitalism.”

“Base?” I asked. “C’mon, Homer: without money you don’t have a base. Chances are your campaign’s already starting to run on the vapors. And as far as Winters symbolizing anything, he stands for whichever way the wind is blowing—which hasn’t prevented him from failing upward higher and faster than any man alive.”

He thought about that for a moment. “I guess my boss might be OK with Winters,” he said. “What would you have in mind? Chairman of the Council of Economic Advisors? Secretary of the Treasury? He’s been there, done that.”

I had a ready answer. “You offer him the job he’ll see as just one rung below what he really wants.”

“Which is?”

“Chairman of the Federal Reserve.”

“We can’t get rid of Bernanke. He only got the job last year.”

“Bernanke’s tenure is up in 2014. So you tell Winters that if he joins the team and plays ball he’ll get the Fed job then. You might drop a hint that if he turns you down, Stiglitz and Krugman are next on the short list. He hates those guys, because they’ve got Nobel prizes and he doesn’t.”

“OK,” he said. “Let’s say Winters takes the bait. What about Holloway? I don’t know much about him.”

“Holloway is the New York Fed’s point person with the banks. They love him because he’s all theirs. If the present administration stitches together a bailout, he’ll be a key player.”

“I see. And where do you see him fitting in?”

“High up at Treasury would be a good spot. Maybe the top job. He’s got the skill sets and experience. Someone once described him as a Hall-of-Fame technocrat.”

Orteig nodded. “And Brewer?”

“Maybe the head of the criminal division at Justice,” I suggested. “More behind the scenes than out front. She’s a top securities lawyer with a ton of regulatory experience, and a good sense of the appropriate parameters of reform and prosecution. She’ll make certain nothing gets out of hand, in terms of punishing individual bankers.”

I’ve concluded that Brewer is perhaps the key player on Mankoff’s little list. Winters and Holloway can divert and distract and throw sand in the policy gears, but if things get “down to the lick log,” as one of my oil-patch clients, a huge Oklahoma collector of Plains Indian art, likes to describe a tight business corner, you need an ace stonewaller, someone who knows how to kill a prosecution before it gets off the ground and stifle the jangle of handcuffs. Think of Brewer as an All-Pro deep safety in a prevent defense.

“I see you have Patrick Vollmer on your list,” Orteig observed.

“Strictly window dressing. The man’s a giant in the earth where the media are concerned, and having someone like Vollmer at least notionally on board alongside the likes of Winters and Holloway will help keep the press in line.”

Orteig reflected for a moment, then: “Take a step back. What if I can’t sell this arrangement to my team? You realize that if there’s a crisis, fingers will be pointed to deregulation as the major culprit. Winters and Holloway were key players in pushing that through.”

“If there’s a crisis, Homer, fingers are going to be pointing every which way. The only question you and your people need to face up to is how bad do
you
want your guy want to be president?”

Orteig fell silent. I said nothing, just watched him debate with himself for a minute.

Finally, he looked up. “So that’s it? We agree to slot these four people as suggested and you’ll find me $75 million?”

I nodded. Then added—of my own volition, just to cinch the deal: “Let’s say $75 million minimum. The people I’m working with seem to know what they’re doing, and that’s their number, but there could be more. It all depends on how things go.”

“So how would it work?”

“You mean how will the money get to the campaign?”

He nodded. “You know there are strict rules about political contributions,” he said. “How exactly would you set it up?”

Now we were in my area of expertise. I laid out roughly, on a no-names basis, the plumbing of an operation like this, a network of cutouts, blind screens, and slice-and-dice shops that will feed the green stuff into Orteig’s designated operating accounts. Was it Mao Zedong who said that revolutionaries must swim like fish in the sea of the population? So it will be with the increments of Mankoff’s money—minnows as it were—that I will toss into the great turbulent streams of money circling the globe.

“The key to moving large sums is to break it down,” I told Orteig. “I’ll break the money into pieces that average $200 to $500 per, which works out to 150,000 names at the max. You’ve already set up political action committees and volunteer organizations in all fifty states, so we’re looking at $1.5 million per state, on average. That’s not a lot of money, although it’s more in Alaska than in Illinois, say, so we’ll vary the inputs to reflect population, voter demographics, and so on. People have learned from Abramoff’s mistakes.”

My reference was to a Washington fixer who went to jail last year for a scheme of political bribery so crude that you’d think a six-year-old would have spotted it. A six-year-old, that is, who hadn’t been paid to look the other way. “Anyway,” I finished up, “$1.5 million per state divided by a $150 average contribution works out to only 10,000 contributors, which leaves me plenty of room to
maneuver. I’ll make it look like thousands of little people out there are dropping their grimy tens and twenties in the offering plate.”