Bailout

Client 9

By Felix Salmon

The tag line of Client 9 , Alex Gibney’s new film about Eliot Spitzer, is “you don’t know the real story”. But the fact is that we do — or I did, at least.

Everybody knows that Spitzer made powerful enemies on Wall Street as attorney general; that he went on to become governor of New York; and that he then resigned after being outed as a client of a prostitution ring. Spitzer himself is clear that his downfall was his own fault; he doesn’t blame it on Ken Langone, Roger Stone or anybody else but himself.

Yes, the investigation of Spitzer was highly political and was more or less unprecedented on many levels. The Mann Act, for instance, was never before used to prosecute the clients of prostitutes — just as the Martin Act had never been used in the ways that Spitzer used it when going after the big investment banks.

Client 9 is one of those films where almost nobody is sympathetic; as a result it’s not exactly fun to watch. It’s a film of persecutors and plutocrats and prostitutes, starring people like sworn Spitzer enemy Hank Greenberg complaining that after AIG’s collapse, his stock in the company was “virtually worthless, about $100 million”.

Spitzer prided himself on playing the hardest of hardball politics, against the most powerful people he could find. That strategy took him all the way to the governorship of New York: there would have been no job to resign from if he hadn’t made powerful enemies along the way.

Maybe Spitzer’s problem was that he was never very good at cultivating powerful friends who could protect and support him — a skill that another executive horndog, Bill Clinton, has in spades. Maybe he never believed that the Bush administration’s prosecutors would go to such lengths to bring him down. Most likely he didn’t overthink his actions at all. Powerful men rarely do, when it comes to sex.

Spitzer’s now a public figure again, on CNN every night. I doubt he’ll ever again get elected to public office, but he would certainly love to be appointed to an important role in the executive branch at some point. He neither wants nor deserves our sympathy, which is why it’s a bit weird that Gibney takes such a sympathetic tone for much of his film.

Spitzer’s popularity was a function of the fact that he was hyperaggressive, super-determined to go after entrenched and powerful interests. He had successes on Wall Street and he had a major failure in Albany. It remains to be seen whether he’ll have a third opportunity to unleash his righteousness and how seriously anybody will take him if he does.

Full post as published by Macroprudential on October 19, 2010 (boomark / email).