Predicting the lifespan of popularity for a demagogue is a risky business, but recent mainstream media pieces certainly indicate that New York AG (“Attorney General” or “Aspiring Governor,” take your pick) Eliot Spitzer‘s fifteen minutes of fame as the nation’s self-appointed Lord of Regulation may be coming to an end. Here are the posts from over the past year and a half that catalog Mr. Spitzer’s relentless self-promotion campaign at the expense of business interests.
First, this NY Times article from this past weekend reviews Mr. Spitzer’s resounding loss in the Sihpol case, where Mr. Spitzer had sought to put away for 30 years a young broker who simply was following orders in doing his job. It’s never a good sign for a business regulator such as Mr. Spitzer when the NY Times — not exactly on par with the Wall Street Journal’s editorial page as a supporter of business interests — suggests that his tactics are overreaching.
Meanwhile, in this Tech Central Station op-ed, Dominic Basulto points out what is really going on:
It is perhaps all too obvious why Spitzer has preferred to use headline-grabbing tactics, intimidation and the threat of criminal prosecution to achieve his ends rather than depend on the U.S. legal system. After all, Eliot Spitzer is not just campaigning against financial wrongdoing on Wall Street — he is also campaigning to become the future governor of New York in 2006. His Spitzer2006.com Web site may not state it outright, but he is trying to leverage his crusade against the most corrupt of Wall Street practices to win over the hearts and minds of New York voters. Sound familiar? To some extent, it’s the same strategy that Rudy Giuliani used to campaign for New York City Mayor nearly fifteen years ago. A few more setbacks in the courtroom, though, and New York voters may view Spitzer only as an over-reaching political opportunist.
Finally, in this OpinionJournal op-ed, Kimberly Strassel reports that Mr. Spitzer’s well-publicized case against former New York Stock Exchange chairman Richard Grasso and NYSE board member Kenneth Langone (previous posts here) is not looking particularly rosy, either. In fact, it’s looking downright baseless:
The AG charges in his suit that Mr. Grasso’s compensation was not “reasonable”–that directors awarded him money based on “incomplete, inaccurate and misleading” information; and that Mr. Grasso influenced his awards. Mr. Spitzer is also suing former compensation committee head Ken Langone–on grounds that he misled directors about the true size of the compensation package–as well as the Exchange itself.
But [more than 1,000 pages of interviews with more than 60 former and current NYSE directors and staff, as well as third parties that Mr. Spitzer attempted to exclude from the lawsuit] refute much of this. Key directors admit that they knew exactly what they were doing in paying Mr. Grasso as they did, and continue to defend their actions.
In the end, Ms. Strassel asks the $64,000 question about the Grasso lawsuit:
Does it serve the interests of the NYSE? Or does it fuel, instead, the political Odyssey of Mr. Spitzer?
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This Dan Feldstein/Chronicle article reports that the brother of former Houston mayor Lee P. Brown was implicated this morning during the opening stages of the federal corruption trial of Cleveland, Ohio businessman Nate Gray:
