Lloyd Blankfein

During the 2007–08 financial crisis, many financial institutions that had dealings in subprime mortgages received a high level of public attention. Goldman Sachs served as a market maker that dealt with financial products that held subprime mortgages. During late 2008, the crisis led the Federal Reserve to lower interest rates and the U.S. Treasury to increase public spending in private banks.[23] In 2009, he was named Financial Times Person of the Year. His citation noted that "his bank stuck to its strengths, unashamedly [took] advantage of the low interest rates and diminished competition resulting from the crisis to make big trading profits."[10][24]

On January 13, 2010, Blankfein voluntarily testified before the Financial Crisis Inquiry Commission that he considered Goldman Sachs's role as primarily market maker, not a creator of the product (i.e., subprime mortgage–related securities).[25] Blankfein testified once more before Congress in April 2010 at a hearing of the Senate Permanent Subcommittee on Investigations. He said that Goldman Sachs had no moral or legal obligation to inform their clients they were betting against the products they were selling to them because it was not acting in a fiduciary role.[26] Senator Carl Levin accused Blankfein of misleading Congress; however, no perjury charges were brought against Blankfein.[27][28] Nevertheless, as a precaution Blankfein hired Reid Weingarten, a high-profile defense lawyer who represented former WorldCom CEO Bernard Ebbers and former Enron accounting officer Richard Causey.[29] Two months later, after the publicity of the testimony increased his public status, he was listed as #43 on Forbes Magazine's List of The World's Most Powerful People in November 2011.[30]

On March 14, 2012, Greg Smith, a former Goldman executive, wrote a widely circulated op-ed for The New York Times titled "Why I Am Leaving Goldman Sachs", in which he heavily criticized the firm's top leadership and Blankfein in particular for sidelining the interests of the client.[31] Smith claimed that employees were promoted for unloading less profitable products on clients, for trading products that maximized Goldman Sachs' profits, not their clients, and trading illiquid, opaque products. Smith's op-ed was criticized by many, particularly because he worked at Goldman for 12 years before deciding to quit because of moral objections.[31][32]

Blankfein, with Lionel Barber and Raghuram Rajan, at the FT and Goldman Sachs Business Book of the Year Award ceremony in 2010.

In February 2018, to counter low sales and trading profits, Blankfein instituted new hiring priorities. He instructed human resource managers at the firm to focus on employment candidates who were "strategists" or "strats," i.e., highly quantitative and technologically proficient.[33]

On March 15, 2018, Blankfein issued an internal memo advocating for complete gender parity among its workforce. He stated: "At Goldman Sachs we pay women and men in similar roles with similar performance equally. However, the real issue for our firm and many corporations is the under-representation of women and diverse professionals both in magnitude and levels of seniority. We have made some progress, but we have significant work to do, and we, as leaders of our firm, are committed to doing this critical work."[34][35]

Blankfein's compensation at Goldman Sachs has been at the center of controversy and interest to financial reporters and the general public. He was paid a base salary of $600,000 with a total compensation package of $54.4 million in 2006 as the highest-paid executive on Wall Street.[36] His bonus reflected the performance of Goldman Sachs, which reported record net earnings of $9.5 billion. The compensation included a cash bonus of $27.3 million, with the rest paid in stock and options.[36] A year later, he received total compensation of $53.9 million, which included a base salary of $600,000, a cash bonus of $26.9 million, stocks granted of $15.5 million and options granted of $10.4 million.[37] On April 7, 2009, he recommended guidelines to overhaul executive compensation. According to The New York Times, he said that lessons from the global financial crisis included the need to "apply basic standards to how we compensate people in our industry".[38] He received US$23 million in salary and bonuses in 2015, which was slightly down from the US$24 million he earned in 2014 from Goldman Sachs.[39][40] According to the Financial Times, Blankfein earned an estimated $22.3 million in 2016.[8]

On March 9, 2018, The Wall Street Journal reported that Blankfein would step down from leading Goldman Sachs by the end of the year.[41] Later that day, Blankfein tweeted "It's the @WSJ's announcement...not mine. I feel like Huck Finn listening to his own eulogy."[42] On March 12, Goldman announced that Harvey Schwartz, the company's co-chief operating officer and president would be resigning, leaving David Solomon as the second-in-command.[21] Hours after the announcement, media outlets–both domestic and international–informally designated Solomon as Blankfein's heir apparent.[43][44][34] It was announced in July 2018 that Solomon would become CEO on October 1, 2018 and chairman by the end of 2018.[45]

He is a supporter of gay marriage and has been a spokesman for the Human Rights Campaign, an advocacy group for LGBTQ civil rights.[52]

In April 2022, Blankfein argued that revoking Disney's special status, enshrined in the Reedy Creek Improvement Act, due to the company objecting to Governor Ron DeSantis' view on Florida House Bill 1557 represents a form of government retaliation for "exercising free speech." He also said it is a "bad look for a conservative."[53]

At the start of 2012, an international inquiry into the average of interest rates of London known as the London Interbank Offered Rate (Libor), found that there was systemic manipulation by various bulge bracket banks for profit.[54] The ensuing July 2012 Libor scandal prompted Blankfein to note that the general distrust of the financial world was worsened: "There was this huge hole to dig out of in terms of getting trust back and now it's just that much deeper."[55]

On June 1, 2017, Blankfein posted his first ever tweet, despite joining Twitter in 2011. He condemned President Donald Trump's withdrawal from the Paris Accord, saying "Today's decision is a setback for the environment and for the U.S.'s leadership position in the world. #ParisAgreement".[56]

During the coronavirus pandemic, Blankfein consistently and repeatedly called for loosening coronavirus response measures and reopening the economy. In March 2020, he said “extreme measures to flatten the virus ‘curve’” were sensible “for a time” but that they could crush the economy. He said, “Within a very few weeks let those with a lower risk to the disease return to work.”[57] In May 2020, amid reopenings of the economy, Blankfein said that the U.S. would have to suffer through a spike in coronavirus cases because the U.S. could not provide additional coronavirus-related stimulus.[58] At the time, he wrote, "Is the public health benefit from broad lockdowns at this point worth such extreme damage to livelihoods?"[59] CBS News described Blankfein as "a leading spokesperson" for the "reopen the economy" movement.[59]

Blankfein opposes a wealth tax on billionaires.[59] In 2019, while criticizing Elizabeth Warren's wealth tax, he alluded to her claimed Native American heritage, saying "Maybe tribalism is just in her DNA." Under her wealth tax proposal, Blankfein would have owed more than $30 million per year in taxes on his estimated $1.1 billion wealth.[7]

Blankfein who earned $24 million from Goldman Sachs in 2018 criticized the notion that CEOs are overpaid. In 2019, he said he felt a "lack of appreciation" in society for Wall Streeters.[7]