The economist vying for the Treasury job worked at a secret firm co-founded by Blinken
The Treasury Department in Washington, DC, Friday, October 8, 2021.
Stefani Reynolds | Bloomberg | Getty Images
An economist slated to head a key office in the Treasury Department held a senior position at secretive private consulting firm WestExec Advisors, co-founded by Secretary of State Antony Blinken.
An archived version of the WestExec website and research by the Revolving Door Project watchdog shows economist Jay Shambaugh worked at the company. Shambaugh, according to Politico, is considered by the White House to be the Under Secretary of the Treasury for International Affairs.
Shambaugh, who is a professor of economics at George Washington University and was also a member of former President Barack Obama’s Council of Economic Advisers, is listed as a director on the archived WestExec site. The site shows that at some point during his tenure, he left the company on leave.
Financial disclosures from those who worked at the firm list former clients who may do business with the Treasury, including many Wall Street firms. Former WestExec clients could represent an ethical hurdle that Shambaugh and the administration may have to overcome for such a senior position at the government agency.
The Revolving Door Project provided research to CNBC that shows Shambaugh likely started working at WestExec in 2020 and left the following year. He became a member of Biden’s transition team after the 2020 presidential election.
A White House official told CNBC on Friday, “President Biden has set the highest ethical standards of any administration in history, and on day one, the president issued an ethics pledge requiring that every appointee in this administration abides by its provisions.”
The official declined to comment on Shambaugh as a potential candidate.
WestExec, Treasury and Shambaugh did not return emails seeking comment.
If selected for the position of Treasurer, Shambaugh will be the last former WestExec executive to join the Biden administration. Reports from The American Prospect and The Intercept show that more than 15 former employees of the private business consulting firm have become members of the administration. At least one Treasury employee has previous ties to the company.
The company promotes itself on its website as a key resource for clients who want Washington insiders’ experience “to help business leaders make the best decisions in a complex and unstable international landscape.” Michele Flournoy, who is listed on WestExec’s website as co-founder and managing partner, was Obama’s undersecretary of defense for policy.
Blinken’s financial disclosure report shows that while he was a managing partner at WestExec, he provided advisory services for Blackstone, Lazard, Royal Bank of Canada, SoftBank and Facebook. Blinken is now at the center of urgent diplomatic efforts to prevent a Russian invasion of Ukraine.