Eliot Spitzer, the scourge of Wall Street, crashed out of politics in 2008 after a sex scandal. Could he make a comeback?by Hephzibah Anderson / May 24, 2012 / Leave a comment
Eliot Spitzer has been taking chess lessons. He has the time for such things these days. It might seem that teaching, writing an online column and working at the family real estate business, not to mention hosting a live television show each weeknight, would leave the father of three with scant opportunity to indulge in hobbies. But Spitzer has proven himself notoriously good—or bad, given how it all ended—at multitasking, having formerly spent his days as the headline-grabbing, opinion-splitting governor of New York state and more than a few nights as Client Nine of the Emperor’s Club VIP prostitution ring.
His marriage has survived but those private transgressions cost him his public office. Since his resignation in 2008, he has found desk space at Spitzer Engineering, the property firm built by his father Bernard. It’s here that I’ve come to meet him early on a muggy Monday in May. Located on the 22nd floor of a midtown block on Fifth Avenue, it’s just another gold-lettered door in a thickly carpeted hallway. Within, an architectural model is the only identifying detail in a modest lobby that might easily belong to a dentist or a doctor. In the life and times of Eliot Spitzer, this is a colossal comedown. The receptionist doubles as his assistant.
In this city whose minutes pass with such fabled celerity, he is still seen as the state’s disgraced Democratic governor more than four years after he was found to have been frequenting prostitutes and became the “luv guv” of tabloid sensation. Nobody is willing to overlook his tumble from grace, but nor can they forget the glittering promise of his political career. As governor—and before that, attorney general—Spitzer was a crusader, championing a wealth of causes from the environmental and the educational to the electoral. And then there was his war on crony capitalism.
“I wasn’t tough enough,” the man once known as “the Hammer of Wall Street” now says. Using a dusty, forgotten law called the Martin Act, pursuing antitrust suits and suing high-profile figures including the former chairman of the New York Stock Exchange, his tactics divided people. He didn’t win a single case but then many were settled long before trial, thanks partly to the threat of lengthy, expensive legal cases in a state where white-collar jails are non-existent, and to his ability to mobilise public outrage through the media. What’s not debatable is his prescience. Within months of Spitzer’s downfall, the financial world came tumbling down alongside him. His media career ensures he retains a platform with a fortnightly column on Slate.com and television shows first on CNN and now on Current TV, but it’s the ongoing financial turbulence that makes people listen and keeps him relevant.
Whether for or against, the strength of feeling that this man arouses is largely undiluted by the passing of time. Among those who saw him as the great liberal hope, the nation’s first Jewish President in the making, the man who was finally going to bring order to Albany, the centre of New York state’s terminally venal government, the frustration remains intense. What was he thinking? Among his detractors—on Wall Street in particular—the outrage is equally vigorous. “There’s a recognition that this was the guy we wanted in public office,” says Lloyd Constantine, one of Spitzer’s lieutenants, whose book Journal of the Plague Year ended their 25-year friendship. “Eliot was way ahead of virtually anybody in power on two huge issues and to some extent suffered for it: crony capitalism and executive compensation.”
Today, Spitzer’s office at the family firm is the office of a family man. Pictures of his daughters—the eldest about to graduate from Harvard—line a sideboard, and there, in front of them, a tidy stack of printouts charting the new chess moves he must learn. He admits that for the moment, his competitiveness outstrips his talent, but he nevertheless plays to win. All of which invites the question: what game is this crusading knight playing now? Is he merely biding his time, eying a return to public life? Is redemption possible in an era of censorious and partisan politics?
“The answer is I don’t know,” he says when I ask would he, could he. “I don’t spend a lot of time worrying about it. I’m busy.” From the mouth of a man who still seems every inch the politician, it’s tempting to read his refusal to say no as a yes. At 52, the caricature-ready face with its domed forehead, jug ears, and jutting chin, is flanked by temples now flecked with white, but he is letting nothing slip. His tie is tight enough to have shrunk the knot at his throat into a scarlet fist and in true politico fashion his deep-set, deep-blue gaze is unflinching. He sits like a man relaxed but you can see the control in the way he holds that pose, and hear it in the way he announces he’s revealing a secret when he tells you that the coffee at Spitzer Engineering is not good. Small talk with this man feels physical, a little like being on a tennis court. As a Brit, he tells me, I wouldn’t know good coffee. Not so the photographer who’s joined us—she’s from Brooklyn. Brooklyn? Well, it’s nice enough, “but you still have to take a subway to get to the real city.”
Elsewhere in the world, success has a habit of breeding dissolute offspring. In New York, parental achievements are just another spur. Spitzer’s older siblings, sister Emily and brother Daniel, are a lawyer and neurosurgeon respectively. In the weeks and months following his resignation, the media flung him on a couch and tried to understand why a man at the pinnacle of his career would throw it all away with hookers. He was a little over a year into his first term when he was identified as “Client Nine,” the man caught on a federal wiretap arranging for a woman from an escort firm to travel from New York and meet him in a Washington hotel room. It seemed like career suicide. The fact that it’s such a cliché doesn’t blunt the urge to understand. Until then, the single scene from his childhood most retold by the media unfolded at the family dinner table. Three times a week, Bernard and his wife Anne would dine with their kids, a meal that became a masterclass in debating. (Anne actually taught a class in critical thinking at Marymount Manhattan College.) Following Spitzer’s disgrace, the same scene was recast as the crucible of a repressed, tightly wound man who would, sooner or later, crack.
What got him through those first few weeks, he says, was pure determination. “You don’t quit. You just don’t quit. Quitting is the easy way out.” If his motivation for the mistake itself remains obscure to him, moving past the immediate crisis did show him things about himself, things he’s reluctant to share. “I’m not in public life right now, I don’t need to answer every question. Every day you learn something, I hope. That’s what life is about. There are ways of learning—you can get kicked in the head, you can read a book. Reading a book is probably easier. But you learn.” While that metaphor doesn’t allow for the fact that he pretty much kicked himself in the head, the fact remains that there were easier routes he chose not to take at the time of his resignation. He could quite plausibly have claimed sex addiction, for instance. The way intrepid conspiracist and author of Three Days in May: Sex, Surveillance and DSK, Edward Jay Epstein, sees it, he might even have swivelled the scandal away from his own culpability and hinted at a set-up. “The political downfalls of Spitzer and Dominique Strauss-Kahn both turned on the well-timed release of information about their sex lives,” says Epstein. “In both cases we now know their enemies knew about their sexual vulnerabilities, so the intriguing issue is: did they use their knowledge in an after-the-fact conspiracy to create a sex scandal?”
A lawyer by training, Spitzer has always had great faith in rules, regulations and cold, hard facts. If anything, that faith appears to have been strengthened by the admission of his own human frailty. The cases he made against Wall Street as attorney general were the result, he says, of the elimination of what had been effective structural guidelines.
“There was a reason to separate commercial and investment banking. There’s a reason to say if you have a federal guarantee, you don’t get involved in proprietary trading [trading with the bank’s own cash]. The bankers said ‘Oh don’t worry about us, we’ll mediate these conflicts of interest’ and ‘trust us, we’re smart, we’re wise’ etcetera, etcetera. Well, that was false. They’re neither smart nor wise; they’re self-interested, they’re crooks, and they’re bad people, and the public and the people in Washington didn’t get that. And so here we are now.”
By tightening financial regulation, Congress has seemed to retrospectively endorse his foresight, though it hasn’t gone far enough in Spitzer’s eyes. The JOBS Act, he says, should have been called “the Bring Back Fraud to Wall Street act.” What really irks him is that Wall Street feels no shame. It’s not surprising that he is such a big believer in the corrective properties of that ruddy-faced emotion, but he would have liked to see handcuffs, too. “There should have been criminal cases brought. There were frauds committed. They think they create wealth—they don’t. The people who create wealth are in Silicon Valley, the engineers in the labs, people who build buildings, not people on Wall Street who move money back and forth with sticky fingers.”
A lot of what Spitzer did to earn the monicker Sheriff of Wall Street might have made him into a patron saint of the Occupy movement, but after initial enthusiasm, his stance towards the movement has become sterner. ‘‘What it did was kind of remarkable,” he says. “It took political and economic conversation that at the time was exclusively about austerity, cutting budgets and entitlements and the rest—things we need to think about—and turned the political debate. The question is what do they do next, and I’m not sure that Occupy’s May Day re-emergence gave us a blueprint. I was hoping that they would come up with something a bit more articulable. The problem is that there wasn’t a leadership. That was at one level the beauty of it but also the undoing of it. Organisations have a structure for a reason. It’s not because structure’s malevolent, it’s because you need a decision process.”
He still thinks there are things Obama could have done better where the economy is concerned, starting with his choice of advisors (his CNN debut in 2010 began with a call to fire the treasury secretary, Tim Geithner), but says that with six months to go until the election, the president is in good shape, even if the second term will be a tougher win for him than his first. “We were in a canoe going over Niagara Falls and we have survived and now we’re making our way back, and we’re doing it despite horrendous pushback by the Republican party,” he says. “The backdrop bizarrely is Europe, and my argument has been, we’ve been conducting the largest macroeconomic experiment in history. Europe went to austerity and has demonstrated that these types of policies are simply not going to help us transition to the economy we need. So I think Barack can make an argument, but he’s making it in a context where people are saying what have you done for me lately, and it’s not as easy an argument as hope and change was four years ago.”
“I’ve always believed there are three numbers that determine the outcome of this race. One is the unemployment number; the second is the price of housing, in terms of are people’s homes going up or down in value, and they’ll probably still be dropping but the question is how do they feel about that; and the third is the price of gas. Those numbers determine how we feel emotionally about the economy.”
Spitzer loves numbers. On Viewpoint, his new hour-long show that strives to delve beyond the headlines in search of facts each weeknight, there is always a number of the day, which Spitzer analyses between interviews with guests. Emotions, on the other hand, are not a subject he is comfortable discussing. Four years down the line, has he gleaned any fresh insights into the question of what made him do it? “What can I say? We’re flawed,” he offers, ducking behind a Woody Allen quote then trailing off into an embarrassed silence: “If God exists, he’s an underachiever—you know, he created something that…”
In a land famed for its second acts, Spitzer has already notched up more than his fair share of scenes, hopscotching from corporate lawyer to attorney general to governor of New York, then crossing the floor to join the media. Counting back through his careers, he sometimes loses track himself. On the set of Viewpoint over at Current TV, I recently watched him chat off-air during a commercial break, praising his “witnesses” before quickly correcting himself: “I don’t know why I’m calling them witnesses. Guests, they’re guests.”
The network, whose co-founder is Al Gore, still bills Spitzer as the Sheriff of Wall Street. He talks like an insider, pointed in his use of first names, speaking not only of Barack but also “Mike” [Bloomberg], whose tenure as mayor of New York he praises despite differences of opinion, and “Hillary,” with whom he overlapped in office (she was a senator while he was attorney general). “I know Hillary, but I don’t know what she’ll do,” he says when I ask about the likelihood of her mounting a presidential bid in 2016. “I hope she runs—I think she would be a great candidate. She would get the nomination in a heartbeat, I don’t think there’s any Democrat who could stand up to her just by dint of experience, wisdom, the base she has. I don’t want to say there’s any buyer’s remorse right now but I think there are a lot of people who still wish—there’s a reservoir of support for her that is very real, and whether that could be defeated by anybody is doubtful in my mind.”
In social and sexual mores, it’s often noted that Manhattan is a good deal more conservative than its pop culture and politics convey. In 2010, for instance, the Emperor’s Club VIP member found himself blackballed from New York City’s Harvard Club. But though the journey back from political disgrace of a sexual nature is a long one, it can be done. Bill Clinton has managed it with relative alacrity. For Ted Kennedy and Gary Hart, the passage was more arduous, yet each got there—Kennedy from Chappaquiddick via (and this probably helped him, ironically) a failed presidential bid in 1980 to a second act in the Senate that almost eclipsed the scandal in his obituaries. Likewise, Gary Hart emerged from a solitary few decades writing histories and novels to become an influential voice on foreign policy and national security. As Constantine sees it, the only thing standing between Spitzer and political rehabilitation is an awareness not of what he did to his family and his reputation, but of the effect those misdemeanours had on all the causes that were riding on his shoulders. “He was the guy who was going to change things. He was very much a future president. There has to be recognition that he has fully internalised that,” he says.
In 2010, Spitzer dismissed claims that he was considering bids for state comptroller, New York state’s chief financial officer, or for the US Senate. Though he similarly shrugs off suggestions that he might run for mayor of New York City, the word “no” does not pass his lips when I press him on it. It would certainly be a tough task given his stance on Wall Street. When I asked Norb Vonnegut, a Morgan Stanley private wealth manager turned novelist, what he would make of a mayoral bid, he was briskly dismissive. “You’re kidding, right? During 2008, Spitzer’s resignation was the one trade that Wall Street cheered.” Yet in the cosy overlap of Manhattan’s media and intellectual worlds, it doesn’t take much to fuel chatter of a bid for social rehabilitation. In April, for instance, he set tongues wagging by hosting a book party for Ian Bremmer’s Every Nation for Itself.
Ari Melber, political correspondent for The Nation and a national staff member on John Kerry’s presidential campaign, believes a return to politics would be welcome. “On the economy and financial regulation, Eliot is one of the smartest and most accomplished Democratic politicians in the country,” he says. “Those issues are not exactly fading away, so his views will be relevant for a long time and he would begin any potential campaign with an enviable policy record. If he did run—and I have no reason to think he will—Eliot’s political challenge would reflect the wider problems in today’s politics: an obsession with scandal above all other topics; campaign coverage that elevates personal ‘narrative’ over public policy; and a partisan establishment that punishes Democrats more than Republicans for personal problems,” he adds, noting that David Vitter, the Louisiana senator whose phone number featured in the records of the “DC Madam,” doesn’t need to plot a “comeback” because he never left.
Back in his office at Spitzer Engineering, Spitzer continues to dance around the subject of a second political act. “Do I miss it? Sure. I’m not going to pretend I don’t miss it, but life is long and there are many different ways to live.” The nicest thing about not leading his former life, he says, is “not feeling the responsibility every day to wake up and try to change things in a context where change is very, very hard. Comparatively, the things I’m doing are easy.” And that, perhaps, is the biggest clue to his long-term game strategy, because, surely, easy is never going to satisfy a mind like Spitzer’s.
Having gone through New York’s notoriously tangled state budget with him, Constantine recalls Spitzer’s meticulous mind. He knew every line item, whether it related to schools or the construction of a new bridge. Together with Spitzer’s wife, Silda, Constantine attempted to persuade him not to resign back in 2008. His survival would not have been guaranteed, but he’d have had a chance. It was a chance he declined to take, so determined was he not to be seen as a hypocrite. “At that moment, he elevated his own sense of himself above his responsibility,” Constantine argues.
Having had the foresight to stand up to Wall Street and to pursue financial reform so determinedly, that responsibility, in his supporters’ eyes, was great. It’s what keeps him topical, and what makes him so very hard for many to forgive.