Peterson’s contacts, his success in the foundations work and in other instances, together with his Republican politics (he was a leader of Illinois citizens for Eisenhower-Nixon, for example) later brought him to the attention of President Nixon. In 1971 Nixon tapped Peterson to head up the cabinet-level Council on International Economic Policy, with advisory responsibility to the president. Peterson soon became known as the “economic Kissinger.” Peterson’s natural focus was on foreign trade, monetary policy, and U.S. economic expansion abroad. In January 1972 Nixon appointed Peterson to be Secretary of Commerce. In that post, he supported the general free-market approach to political economy, including increased government support for multinationals, relaxing antitrust laws, tax cuts, financing for exports, and business-oriented government-financed research and development. In his early career, he was active in both the “conservative” Committee for Economic Development and the “liberal” Brookings Institution. Working as a leader in both organizations he made additional important friends and contacts. In 1971 he applied for and was accepted into membership in the CFR.
Peterson became close friends and a political partner with Henry Kissinger, but clashed with the far-right Republicans in the Nixon administration, resulting in his exit from Washington.62 When he left in 1973, he was brought into Lehman Brothers as vice chairman. Later the Wall Street firm became Lehman Brothers, Kuhn, Loeb, with Peterson as chair and CEO until the end of 1983. Two years later he was a co-founder, with fellow CFR member Steven A. Schwarzman, of the Blackstone Group, which soon became a prominent firm specializing in private equity, mergers and acquisitions, real estate, and investment (especially for pension funds). Blackstone also created a more liquid and speculative branch, a fund of hedge funds called Blackstone Alternative Asset Management. Peterson became a billionaire while serving as chairman of Blackstone. In 2007 alone, the year Blackstone went public, he was paid $1.85 billion. While at Blackstone, part of the largely unregulated but vast “shadow banking” system, Peterson also served as head of the New York Federal Reserve Bank from 2000 to 2004, as well as chair of the Council.
Over the years, Peterson developed very close ties to David Rockefeller and the Rockefeller family. He has served as a trustee or board member of at least three Rockefeller family–dominated organizations—the Japan Society, the Museum of Modern Art, and Rockefeller Center Properties, Inc. Consequently, Peterson has had only good things to say about the Rockefellers. John D. III was “dedicated to maintaining one of America’s premier legacies and converting family wealth to public good.”63 David was “a special person…. He seemed to have met every famous person in the world, and he spoke of global political and economic matters with great command.”64 In addition, Peterson said, “I have always been a so-called Rockefeller Republican, a rapidly vanishing species. I joke that there are only two of us left, David Rockefeller and myself.”65 In addition, “I was no longer young when David Rockefeller asked me to chair the Council in 1985…. That I, the son of Greek immigrants from a small, rural town in Nebraska, could follow David was a rare privilege.”66
For decades Peterson has been a strong advocate of reducing the federal budget deficit, even critiquing his own Republican Party for overspending, stating in 2004: “I remain a Republican, but the Republicans have become a far more theological, faith-based party, not troubling with evidence.” He is the founding chairman of the Peterson Institute for International Economics, the Concord Coalition, and the Peter G. Peterson Foundation, donating large sums to each organization. These bodies, especially the latter two, focus on fiscal sustainability issues, especially trying to set the stage for cuts to what Peterson and other elements of the capitalist class call “entitlements.” But these so-called entitlements are actually programs like Social Security and Medicare that rank-and-file workers have fully paid for with their taxes. The federal government has borrowed heavily from the Social Security trust fund, threatening the system by leaving only IOUs behind. Peterson and the organizations he has founded and funded are trying to kill these and other programs that help working people survive, drumming up hysteria about budget deficits as a means to try to accomplish this end. This hysteria also aims to lower taxes on corporations and the rich.
Robert E. Rubin, Vice Chair, 2003–2007, Co-Chair, 2007–Present
Born in 1938, Robert E. Rubin was born into a New York City Jewish household strongly influenced by the culture of law. His father and his mother’s father were lawyers, and Robert at first followed the same path. After a Harvard BA in economics and a year at the London School of Economics, he attended Yale Law School. Upon graduation, he joined a Wall Street law firm. Attracted more to a career in finance capital, he soon quit the law firm and was hired by the Goldman Sachs investment bank as a securities trader, starting a lifelong Wall Street career. Soon he was specializing in the arcane world of risk arbitrage, and he was very good at it. Risk arbitrage is a type of hedge fund trading, gambling on commodities, foreign exchange, and stock price movements, the latter focusing on “spreads” between the existing stock price of a company and an offer price, which requires assessing the varied risks in mergers, acquisitions, and liquidations by and between corporations. Rubin’s skill at risk arbitrage and the two dozen or so years he specialized in it led him to both great personal wealth and the top of Goldman Sachs by 1990, when he and Stephen Friedman, another CFR leader, became co-chairmen of Goldman Sachs. Along the way he applied for and was accepted as a member of the CFR in 1981.
It was while at Goldman Sachs that Rubin became a key player in the Democratic Party, illustrating that Council leaders are active in both of the two main U.S. political parties. He was part of candidate Walter Mondale’s “brain trust,” both as a fundraiser and as a strategist in 1984, and was also a major supporter of Michael Dukakis in 1988. Both of these Democratic presidential candidates were CFR members, as was William J. Clinton, whom Rubin served as a key economic adviser. Once Clinton was elected president in 1992, Rubin was chosen to lead the newly formed National Economic Council and became one of the key formulators of the North American Free Trade Agreement. In late 1994, President Clinton appointed Rubin to be the nation’s 70th secretary of the treasury.67
As part of Clinton’s inner circle, Rubin helped him win a second term in 1996. As treasury secretary, Rubin was a vocal supporter of the repeal of the 1933 Glass-Steagall Act, allowing commercial and investment banks to be unified.68 He resigned in 1999 and was replaced by one of his protégés, Lawrence H. Summers, also a CFR member. That same year Rubin joined the board of directors of Citigroup, and also served as a senior adviser to the company. Citi was a main beneficiary of the financial deregulation that Rubin sponsored during the Clinton administration.69 Rubin is reported to have received at least $126 million in cash and stock in the almost ten years he worked for Citi. He quit Citicorp in early 2009 as it was on the verge of collapse, which was only averted by a $45 billion federal government bailout.70 After leaving Citi, Rubin became counselor for Centerview Partners, an investment and private equity firm. In 2012 Centerview was financial adviser to Rupert Murdoch’s News Corporation dealing with its intention to pursue a separation of its publishing and its media/entertainment businesses into two distinct publicly traded companies. Murdoch is also a member of the CFR.
In 2000 Rubin was elected to the Council’s board of directors, and became vice