William D. Cohan is the author of Money and Power: How Goldman Sachs Came to Rule the World (2011).

Did Hillary Clinton engage in a secret handshake with Wall Street—and make herself beholden to the big banks—by getting paid $225,000 a pop for speaking at three events held for Goldman Sachs clients in 2013? Certainly that is the implication of Bernie Sanders’ rhetoric, and it’s clear by now that the issue is not going to go away anytime soon. Sanders received an unexpected endorsement of his anti-Wall Street campaign this week from no less than Neel Kashkari, the Republican head of the Federal Reserve Bank of Minneapolis and former senior Treasury official under George W. Bush and Barack Obama, who echoed the Bern in warning that taxpayers may still have to bail out too-big-to-fail banks in the future. The Clinton campaign has responded by trying to turn Sanders’ strongest suit against him, disparaging him as a “single-issue” candidate.

So perhaps it’s a good time to re-examine Clinton’s dalliance with the big banks, in a little more depth. (And it wasn’t only Goldman Sachs, by the way; Clinton also spoke to the likes of Morgan Stanley, Bank of America, Fidelity Investments and Deutsche Bank, among others, for at least $225,000 each.) To try to figure out what Clinton said in those private conversations (since she has yet to release the transcripts of them), I spoke with a number people who were in the audience at the Goldman events. Their descriptions of her remarks, in a question-and-answer format, run contrary to some accounts. At Goldman, at least, Clinton’s comments were far from a full embrace of Wall Street, according to the people who attended these sessions. Audience members described her comments as relatively innocuous and mundane and said she did not offer any assurances—as seems to be the implication of some of the criticism directed her way—to the clients or to the host, Goldman Sachs, that as president she would roll back new regulations placed on Wall Street by the Dodd-Frank law or of the much-despised "Volcker rule," which limits proprietary trading. Instead, Clinton focused mainly on world affairs—she had recently resigned as secretary of state—and the Obama administration’s struggle with getting the Affordable Care Act website up and running after some early snafus.


In fact, at one of Clinton’s three appearances, at the Conrad Hotel near Goldman’s Manhattan headquarters on Oct. 24, 2013, she responded to a question from the audience about the financial crisis and the Wall Street bailouts by saying she “wasn’t super close” to the decision-making about what shape the Wall Street rescue should take—the Bush administration was the architect of the bailouts, but they were ratified by the incoming Obama administration—but that “we had to do something” because “this was a big mess.” Lots of people “got hurt” because of the financial crisis, she continued, “and you may not have liked what we did but it had to be done.” But, Clinton added, “I’m not the expert.” No one “was asking about the Volcker rule,” the audience member said.

Clinton’s account of her lack of involvement in financial reform appears to square with the facts of her time as secretary of state. From the very beginning of the Obama administration, as then-Treasury Secretary Timothy Geithner and other senior officials were involved in steadying the economy and launching Dodd-Frank and the Volcker rule, Clinton was almost entirely occupied abroad as the nation’s chief diplomat.

Even so, there were a couple of occasions, this audience member recalled, particularly at the beginning of the Oct. 24 event, when Clinton was introduced and toward the end of her remarks—moments he described as “throat clearing”—where what Clinton said could be taken out of context and be made to look as though she was in Goldman’s pocket. These moments occurred, he said, when Timothy O’Neill, the head of Goldman’s asset management business, thanked her for her service to the country, the state, to New York City and “to our industry.” At another event, the Goldman tech conference in Arizona, Goldman CEO Lloyd Blankfein interviewed Clinton, and they appeared “chummy”—they actually are friendly—and joked about how it had been so long since she had spoken at Goldman. (It was just five days later.)

It is not an uncommon practice at the big Wall Street banks to pay between $200,000 and $300,000 for luminaries such as former President Bill Clinton, New Jersey Gov. Chris Christie (pre-Bridgegate), Joe Torre or Derek Jeter to speak, or answer questions as Hillary Clinton did. “That’s the going rate,” explains a senior Wall Street executive who arranges such events. “It’s a pretty efficient market, like anything else.” He says people like George W. Bush, Ben Bernanke and Geithner get paid even more than the $225,000 that Clinton received. “So I certainly don’t fault her,” he said. “In hindsight for her, I do think that you could have seen that if you wanted to run for president, you know …” He left the comment hanging, but he clearly indicated that she should have known that taking so much money from Wall Street banks before the start of the next presidential election cycle was not the smartest decision.

The bigger issue, of course, is whether, when all is said and done, Clinton is simply too closely aligned with the views of executives at Goldman Sachs, Morgan Stanley and the other big banks, private equity firms and hedge funds, many of which have thrived since the financial crisis and continuously lined her pockets, as well as those of her husband, her campaign and her family’s foundation. In other words, is Bernie right? Clinton hasn’t helped herself by equivocating over whether her campaign would release transcripts of her Goldman appearances, saying she would “look into” the possibility of doing so. In the process, she has handed Sanders a perfect cudgel with which to beat her up over the idea that she must have something to hide or be pandering to the rich on Wall Street and would never take them on if she were elected president, or both.

She has been mainly on the defensive against her Democratic rival over the issue. At the PBS debate last week, she responded to Sanders’ criticism by saying that President Barack Obama had also taken money from Wall Street but had signed Dodd-Frank anyway. “I debated then-Sen. Obama numerous times on stages like this, and he was the recipient of the largest number of Wall Street donations of anybody running on the Democratic side ever,” she said. “Now, when it mattered, he stood up and took on Wall Street.”

But there are many critics of the banks (not just Sanders) who would say that Clinton’s former boss, Obama, fell short of fully standing up to Wall Street. Among them apparently is Kashkari, the former Bush administration official who was part of the effort to bail out Wall Street in 2008 but who now says openly that the effort by then-Treasury Secretary Geithner to rein in future bank behavior did not go far enough, and neither does the Dodd-Frank law that Obama signed. In a much-noted speech earlier this week, Kashkari even suggested that large banks should be regulated like public utilities, "by forcing them to hold so much capital that they virtually can’t fail (with regulation akin to that of a nuclear power plant)." Sanders, of course, immediately took note, as did the punditocracy. “Bernie Sanders may have just found his Federal Reserve chairman,” Reuters wrote.

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There are many facets to Clinton’s Wall Street ties, beginning with the years from 2001 to 2009, when she was a U.S. senator from New York. That alone would virtually guarantee that she would have many occasions to mingle with—and get financial support from—the rich and powerful on Wall Street. And she said as much, in her way, during a debate last November after Sanders wondered why she had received “millions of dollars” in campaign contributions from Wall Street if it did not “expect to get something” in return. Said Clinton: “I represented New York, and I represented New York on 9/11 when we were attacked. Where were we attacked? We were attacked in downtown Manhattan, where Wall Street is. I did spend a whole lot of time and effort helping them rebuild. That was good for New York. It was good for the economy, and it was a way to rebuke the terrorists who had attacked our country.”

It didn’t poll well. In fact, invoking the September 11 attacks as a way to justify her support of Wall Street was generally viewed as a gaffe of major proportions.

Another liability is that Clinton has consistently surrounded herself with Wall Street types, in both formal and informal ways. Gary Gensler, a former partner at Goldman Sachs and the former head of the Commodity Futures Trading Commission, is the Clinton campaign’s chief financial officer (though Gensler was widely praised as CFTC chairman for confronting the big banks over many issues, especially risky derivatives trading). She is said to speak regularly with Tom Nides, a vice chairman of Morgan Stanley and a former deputy secretary of state when she was the secretary. She is also close with Blair Effron, one of the founders of Centerview Partners, where Robert Rubin, the former co-senior partner of Goldman Sachs and a Treasury secretary under President Clinton, is a senior adviser. The list of her Wall Street buddies goes on and on: Alan Patricof, the private-equity mogul; Marc Lasry, the founder of the Avenue Capital hedge fund where Chelsea Clinton once worked; and Steve Rattner, the former private-equity investor who now helps to manage a portion of Michael Bloomberg’s fortune, and his wife, Maureen White.

Understandably, as secretary of state, Clinton refrained from commenting about the causes of the financial crisis and its consequences. But, on a few occasions before then—during her pitched battle against Obama to get the 2008 Democratic Party nomination for president—she did make critical observations about Wall Street behavior, although they were few and far between. In March 2008, as a presidential candidate, she called for “much more vigorous government oversight and enforcement of the subprime mortgage market.” Clinton also questioned the fairness of the tax rules that benefit private-equity firms. In a 2007 news release from her campaign, Clinton declared (but only after Obama and Sen. John Edwards had already done so): “Our tax code should be valuing hard work and helping middle class and working families get ahead. It offends our values as a nation when an investment manager making $50 million can pay a lower tax rate on her earned income than a teacher making $50,000 pays on her income.” Clinton said she would eliminate “carried interest” benefits and use the funds generated by the tax change—which some have estimated at $4 billion to $6 billion per year—to invest in middle-class and working families.

Then came those speeches. Around half of her speeches in 2013 were to financial or finance-related business groups. Only Goldman Sachs asked her to speak more than once. (They must really like her.) In 2013 alone, according to records released by her campaign, she made $9.9 million from 41 speeches or conversations. Not once did she take less than $225,000 for a speech and, for a few, she was paid more: $400,000 for an October 2013 speech in Chicago to the Jewish United Fund, and $305,000 a few weeks later to the Beaumont Health System, in Troy, Michigan.

Clinton’s first presentation to Goldman, on June 4, 2013, was at a Goldman investment-banking conference for CEOs held at a resort in Palmetto Bluffs, South Carolina. Her next two appearances were both in October, on October 24, at the Conrad Hotel, and then five days later at a technology entrepreneur conference in Tucson, Arizona. The Conrad Hotel appearance brought together big pension-fund managers who were clients of Goldman’s asset management division. The idea behind getting Hillary Clinton to the event was to reward the Goldman clients, including people like Larry Fink, the chairman and CEO of BlackRock, the huge asset management company, and top hedge fund managers with a “big name,” someone who was there said, and to get them to stick around until the end of the day.

At the time Clinton made her three paid speeches at Goldman, she was in a mode of cashing in on her fame as the former secretary of state, through regular speaking gigs and in obtaining a book advance said to be in excess of $10 million. (CNN has reported that the Clintons made $141 million between 2007 and 2014.) She was still the darling of Wall Street and rarely said much of anything substantive about Wall Street re-regulation or the Dodd-Frank law.

During the October 24 dinner, for example, Clinton answered questions for about 45 minutes from Timothy O’Neill, the head of GSAM, and took a few questions from the audience. “About 85 percent of her answers” were about “what’s going on in the world,” one audience member said. Clinton spoke about what the new president of China, Xi Jinping, was like, as well as the goings on in Russia as well as the Middle East. “Flash points around the world,” this person said. “It was not about the financial markets.” He said she was “reasonably direct” and “less diplomatic than if she were on Meet the Press” in her comments about world leaders since she was no longer a member of the Obama administration and had not yet announced that she was running for president. (Asked about that, in fact, she said she had “made no decisions” and was “enjoying [her] time off.”) Clinton also spoke about the “dysfunction” in Washington since, at that time, another government shutdown had been threatened and how “embarrassing” the prospect of it was. The attendee said there was discussion about “how do we fix the mess in Washington.”

Another timely topic was the problematic rollout of Obamacare. Clinton told the pension-fund managers that Obamacare was a “super important” initiative and that she gave Obama “a lot of credit” for getting it passed. “I tried,” she said. “I failed.” She said the website had to be fixed—it since has been—and the “parts that aren’t working would soon be.” The person who was at the session said that even though the crowd was politically conservative, the consensus of the people around him seemed to be, as Clinton spoke, “Thank God we have people like [her] working in the government. She’s very pragmatic, very reasonable, very sensible.”

He said that Clinton pretty much stuck to the script and said nothing that could be interpreted as pandering to the Wall Street crowd.

There is one definitive moment when Hillary Clinton did praise Goldman Sachs—and one can see it in the video online of her remarks to the Goldman Sachs 10,000 Women Initiative annual dinner, held at the Clinton Global Initiative conference in New York on October 24, 2014. Goldman makes an annual contribution to the CGI that brings to the dinner a brief appearance by Bill, Hillary or Chelsea Clinton. In her nine-minute (technically unpaid) talk, Hillary Clinton mentioned Blankfein by his first name, as well as John F.W. Rogers, a senior Goldman executive, and Dina Powell, president of the Goldman Sachs Foundation, by their first names. She gave a shout-out to Jack Ma, founder of the Alibaba Group (a Goldman client), who was in the audience. She spoke about the need to encourage more female entrepreneurs and the need to make more credit available to them. She cited some Goldman Sachs research. “Recognizing the untapped potential of women in the global economy is one of the great insights of the early 21st century,” she said, reading from a prepared speech. “And I do appreciate the work Goldman itself has done in contributing to the growing body of research that documents the business case for investing in women.”

That’s right. The speech was a crashing bore. It probably won her very few votes, and the fat fee she took for it and the other Goldman speeches has probably cost her more than anything else in this campaign. The question is whether it could also cost her, in the long run, the nomination and the presidency.