Jack Lew is well-known and well-respected for quietly doing his job well. He is not as well known for quietly quitting his job well. President Obama's nominee to be Treasury Secretary will get a vote in the Senate this week, and ahead of that, little biographical details about him have leaked to the press. Among these are that Lew tends to get his former employer to pay him to take a new job. We should all aspire to be such well-respected and well-compensated public servants. Here are some lessons we can learn from Lew:
Get paid like you're scandalous without being scandalous. When Lew left New York University in 2006, he got a severance package of $685,000, The New York Times' Danny Hakim reports. His salary had been between $700,000 to $800,000 since he was hired in 2001. The exit payment from a non-profit institution "is considered unusual by outside experts in benefits," because Lew was leaving voluntarily. Usually a big payout only happens when the executive is forced out, like when Penn State's former president, Graham Spanier, received $1.2 million to quit amid the football program's child sex abuse scandal.
Be careful about relationships between your past employer and your future one. While Lew was at NYU, the university chose Citigroup as its preferred lender, The Times reports. Lew left NYU for Citigroup in 2006. Less than a year later, Citigroup paid $2 million as part of a settlement with New York's then-attorney general, Andrew Cuomo, "over Citigroup’s role as a preferred lender to students at N.Y.U. and other colleges," Hakim writes. "The case focused, in part, on what were basically kickbacks being paid by preferred lenders to universities; N.Y.U. paid $1.4 million to reimburse students as part of the same settlement." Lew told senators, "I do not recall having any conversations with Citigroup officials regarding Citigroup’s selection or actions as a preferred lender for N.Y.U. students... Also, I do not believe that I approved the selection of Citigroup as a preferred lender for N.Y.U. students."
Get your great paying job to compensate you for taking a not-so-great paying next job. Lew worked at Citigroup from 2006 to 2008. His contract included the stipulation that if he could keep his full bonus if he quits to take a "high level position with the United States government or regulatory body," The Wall Street Journal reports. Lew was making $300,000 a year, and his bonus was $400,000, to be paid in his first year. As New York's Kevin Roose notes, there were other ways for Lew to keep that bonus, like if he had had to relocate or was bumped down to fewer hours or lesser responsibilities. This makes it look less like an incentive to keep the revolving door between Wall Street and Washington spinning, but not any less sweet of a deal for Lew.
This article is from the archive of our partner The Wire.
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