The Governor of New York just appointed Richard “Dick” Ravitch to serve as his lieutenant governor.
I served as the Dillon Read officer responsible for our senior underwriting responsibilities to the Metropolitan Transportation Authority (MTA) when Ravitch was Chairman. Once upon a time, he introduced me as his banker.
When I ran Hamilton Securities Group, I made the mistake of putting Dick on one of my advisory boards and hiring him as a consultant. After he helped smear me and engineer the housing bubble, he ended up with Paul Volker as an office mate in Rockefeller Center, while I slugged through thirteen years of litigation. That’s another story.
Dick is someone who is not entirely trusted by the top guys—he has a temper and requires a lot of stroking. After years of lobbying the first Bush Administration to become head of the Resolution Trust Corporation, they gave him the nod. At that point he started making demands and then turned it down. However, he is a capable workout guy who loves drama and stress and being at the center of highly ugly political situations and will do whatever horrible thing needs doing in exchange for some power and prestige.
He has traditionally been very loyal to Bob Rubin, who served as his finance chairman when Dick ran for Mayor, hedge fund manager Mickey Steinhardt, and a variety of NY real estate and financial interests, including Goldman Sachs. Hence, from their point of view, he would be an excellent person to manage a NY state bankruptcy, bond default or significant government re-engineering.
Dick built his initial fortune with a family construction business and affordable housing. A lawyer by training, he once told me that he had a significant number of Wall Street law firm partners as the LP interests financing his HUD and affordable housing apartment buildings.
One of my favorite Dick Ravitch quotes was in 1988, when I picked him up at his Park Avenue apartment for a black tie dinner. I told him that President-elect Bush had asked me to serve as FHA Commissioner. He looked at me in formal evening attire, surprised at the notion that a 38 year old woman, even his banker, could be the FHA Commissioner and said, “You don’t look like an FHA Commissioner.”
Another was a statement he made to me in 1997 about his government subsidized apartment buildings in New York over a steak dinner at the Jockey Club in Washington. Our dinner followed a meeting at the AFL-CIO where Dick served as chairman of the AFL-CIO Housing Trust.
“As long as I can get government subsidies, what do I care if people have education or jobs?”
—Dick Ravitch, Chairman, AFL-CIO Housing Trust
I believe this appointment means that Wall Street and the Rockefeller interests want their workout guy in place to deal with the state budget and re-engineering New York government. It also means that Dick is going to grapple with what happens to his city and state when a generation of real estate owners don’t care if people have education or jobs.
You see real estate does not have much value when the people living in it don’t have an education and jobs. And it is hard to balance a government budget when the aristocracy makes money by destroying the local tax base and tax payers.
Very few people were more instrumental in creating our current mess than Dick Ravitch and his allies. It will be interesting to see how they propose to deal with it and how that dovetails with their already considerable personal fortunes.
Can He Do That? Gov. Paterson Names Richard Ravitch as Lieutenant Governor
Daily News (09 July 09)
Ravitch Files Financial Disclosure Form
Politics on The Hudson (10 July 09)