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Economist in running for Treasury job worked at secretive firm


The Treasury Department in Washington, D.C., on Friday, Oct. 8, 2021.

Stefani Reynolds | Bloomberg | Getty Images

An economist under consideration to lead a key office within the Treasury Department had a senior role at the secretive private consulting firm WestExec Advisors, which was co-founded by Secretary of State Antony Blinken.

An archived version of WestExec’s website and research by watchdog the Revolving Door Project show that the economist, Jay Shambaugh, worked at the firm. Shambaugh, according to Politico, is being considered by the White House to be the Treasury’s under secretary for international affairs.

Shambaugh, who is a professor of economics at George Washington University and was also once a member of former President Barack Obama’s Council of Economic Advisers, is listed as a principal on the archived WestExec site. The site shows that at some point during his tenure he went on leave from the firm.

Financial disclosures of those who used to work at the firm list former clients that could conduct business with the Treasury, including numerous Wall Street firms. WestExec’s previous clients could represent an ethics hurdle Shambaugh and the administration may have to overcome for such a top job 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 next 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 established the highest ethical standards of any Administration in history, and on day one the President issued an ethics pledge requiring every appointee in this Administration abide by its provisions.”

The official declined to comment on Shambaugh as a possible nominee.

WestExec, Treasury and Shambaugh did not return emails seeking comment.

If selected for the Treasury job, Shambaugh will be the latest former WestExec executive to join the Biden administration. Reporting by The American Prospect and The Intercept shows that over 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 firm.

The firm promotes itself on their website as being a key resource for clients who want experience of Washington insiders “to help business leaders make the best decisions in a complex and volatile international landscape.” Michele Flournoy, who is listed on WestExec’s website as a co-founder and a managing partner, was Obama’s under secretary 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.


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