By Anthony Burke Boylan --Jamie Dimon certainly has come a long way since he was considered a stunt casting choice to take over an institution called Bank One.
Back in 2000 analysts were split on whether Dimon was a brash choice for the then fifth largest bank in the nation – albeit one beset by credit card troubles – or an unproven protégé to Sandy Weill, taking the job more out of spite for his ouster from Citigroup than because he really wanted to run a bank.
An April, 18 2000 BusinessWeek article posed the question: “Jamie Dimon: the wrong man for the Bank One job?’’ The piece went on to quote Dale Jacobs, then head of a New York money management firm called Financial Investors, who called Dimon a dealmaker, but questioned his ability to oversee integration, employees, analysts, investor relations and nearly every day-today operation.
Today Dimon is the head of JPMorgan Chase, the largest U.S. financial services company, his navigation of the credit crisis was praised by President Obama and he is in his second round of speculation to be named Secretary of the U.S. Treasury. (A Google search shows a 2009 Seeking Alpha article referring to Mr. Jacobs only as a former wire house executive.)
There is little doubt Dimon’s experience and performance make him qualified to be Secretary of the Treasury. The real questions are whether the political climate will allow it, and if he isn’t a more effective agent of reform in his current role.
While the financial media has been abuzz with speculation on Dimon’s ascension to the post, there are those who have their doubts. While the doubters are wise to keep in mind the cautionary tale that is Mr. Jacobs, there is good reason for their dissent.
Ř This is the second time Dimon has been considered for the post. He’s telegenic and a plain-spoken, quote-spewing media darling, which means it could be wishful thinking by the press this time around, much as it was the first.
Ř Dimon is a Democrat and was second only to Oprah in the prestige he brought the Obama campaign; second to none in the Wall Street imprimatur he provided. But true to his firebrand nature, Dimon has split from the administration on key financial industry issues – a very public disagreement at a time when banking news shot from the recesses of the business section to the front page, nightly local newscasts and just about every Internet home page. (Can you remember another time in history when Saturday Night Live spoofed the banking industry?)
Ř Dimon is a Wall Street banker through and through. Is there any doubt naming him to head Treasury is going to start a round of howls about putting a fox in charge of the hen house? Ask Henry Paulson how his Goldman Sachs credentials were regarded as he oversaw the initial stages of the banking bailout.
Ř If Dimon joins the public sector, who could be a better exemplar of bank industry reform and success? There is every chance he’s serving the administration better from his plush Manhattan offices than he could from just off K Street in D.C.
Ř Dimon has publicly discussed a career after banking, and there is no doubt he covets the prestige that goes along with such an appointment. But after seeing Timothy Geithner become a political punching bag – asked to resign by a Congressman from Texas last week – would he want to step into an arena that threatens to tear down the gold standard reputation he has built?
Sure, Dimon has fans on both sides of the aisle, as much for his taxpayer fund-saving acquisitions of Bear Stearns and WAMU as for his opposition to continued too-big-to-fail protection.
But opposition rhetoric is as inflamed as it has been in memory, and Congressional Republicans are happy to overlook the fact they supported, and even initiated, the financial reforms for which they now are throwing Geithner to the wolves. Dimon has to be aware that many a Treasury Secretary has become a scapegoat.
Of course there is one more reason that plenty of people from bankers to bloggers think Dimon is more likely to be the next football coach at Notre Dame than his is to take the well-worn path from Wall Street to Washington: Geithner isn’t going anywhere soon.
The Atlantic summed it up well:
For starters, Geithner isn't going anywhere. Anyone who thinks he might be is nuts. He has carried out President Obama's every wish. And the financial markets have been doing considerably better since he took the reins. While the broader economy isn't doing quite as well, the Treasury Secretary has had little control over any of that. He played virtually no role in the stimulus, the decline of the dollar or the deficit. Unless he gets tired of the job, I'd be shocked -- shocked -- to see him ousted. That would make the Obama administration look really bad.
Anthony Burke Boylan is a veteran financial and political journalist, as well as a media and public relations consultant. Contact him at tboylan@capitalinsight.com
