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The Downfall of Eliot Spitzer

Posted March 13, 2008 By ALAN GREENBLATT

The governor’s hard-charging manner turned out to be more than Albany was able to stand.

Eliot Spitzer's failures have been on full display this week. His personal failings have dominated the news and cast a grim retrospective light over his surprisingly poor performance as governor of New York. But it's worth stepping back and remembering why Spitzer mattered in the first place.

Eliot Spitzer

There have been other governors at the center of sex scandals, but few have engendered such a sense of disappointment as New York's Democratic governor, who will officially leave office on Monday. There is the disappointment that he turned out to have illicit urges and was dumb — and criminal — about fulfilling them. But there is also disappointment borne of the sense that Spitzer should have done more in the public office he held.

He was governor for just over a year. It was a difficult year. His hard-charging manner, which suited him fine as a prosecutor, turned out to be more than Albany was able to stand. No legislators want to be told that they're corrupt, that they're going to be "[expletive] steamrollered." Looking back, it seems clear that Spitzer often engaged in behavior that was questionable, even while he tried to seize the aura of the only honest man within his territory.

He had managed to accomplish much more as state attorney general. There were reasons why a state attorney general became an unstoppable political force in his own state and a national media darling.

Driven and smart, Spitzer grew up and lives among New York's wealthy classes and holds degrees from Princeton and Harvard Law School. He first won fame as an assistant district attorney prosecuting members of the Gambino crime family.

Elected as state attorney general in 1998, Spitzer had a way of reading the prevailing political winds and hoisting his sail to catch them, pursuing high-profile cases in the areas of abortion rights, racial profiling and regulation of the charitable donations that flooded into the state after the Sept. 11, 2001 terrorist attacks. Spitzer won headlines by forcing major grocery chains to pay immigrants the minimum wage and shamed the U.S. Environmental Protection Agency into taking action against Midwestern power plants he was suing for violating the federal Clean Air Act.

But Spitzer was best-known for his crusades against Wall Street. He forced financial firms to pay more than $1 billion to settle complaints that they had manipulated prices and cheated investors. He made deals that forced firms to end the practice of having their analysts push the stocks of their investment-banking clients. His attacks were often personal, as in his challenge to the big payday received by Richard Grasso after he left the chairmanship of the New York Stock Exchange.

Brooke Masters, in her 2006 Spitzer biography, recalls Spitzer's appearance at an Institutional Investor banquet honoring the "all-star" analysts of the year. Spitzer refused the advice of aides to tone down his remarks, which resulted in his lecturing the crowd about how these supposed all-stars had failed.

"When measured by the performance of their stock recommendations," he said, "only one of this year's fifty-one first-team all-stars ... ranked first in their sector." The audience started to leave in droves. "I'm not going to sit here and listen to this [expletive]," one snapped.

Shame and Intimidation

It was this type of approach that led his critics to complain that Spitzer was high-handed, making aggressive use not only of obscure laws that gave him unusual prosecutorial powers in areas traditionally left to federal regulators but also making heavy use of the court of public opinion, shaming and intimidating his targets to settle cases that Spitzer was unlikely to win in court.

But Spitzer's populist stance won him national attention and earned him press that was generally laudatory. In 2002, Governing honored Spitzer as a Public Official of the Year.

By the time he was ready to run for governor in 2006, his profile and fundraising prowess was such that three-term Republican Gov. George Pataki opted not to run for re-election. Spitzer triumphed over a lesser-known opponent, winning by the largest margin in state history.

He used his campaign and electoral strength to claim a mandate to clean up Albany. Spitzer's aggressive sense and his ability to position himself in the public eye as incorruptible and dogged led to high hopes that he would change overly cozy and lethargic political processes in the state capitol.

But Spitzer stumbled almost immediately, fighting with the legislature over budget matters and the decision to name a new state comptroller. Spitzer as governor continued to campaign, appearing in the home districts of legislators to rail against them — including members of his own party.

And behind Spitzer's "Mr. Clean" image, lay a pattern that suggested the governor felt he could get away with behavior that, if it were done by anyone else, he would have considered questionable.

Most notoriously, close Spitzer aides last summer improperly used the State Police to gather information about state Senate President Joseph Bruno, Spitzer's Republican nemesis in Albany. Ethics and criminal investigations are ongoing in that matter.

During his 1998 bid for state attorney general, Spitzer was less than forthcoming about the role his wealthy father had played in financing his campaign. That year Spitzer told the New York Times, "I would say that what I have done absolutely complies with the law, and that is the critical issue here." He told the newspaper he had chosen not to be forthright about his funding in order to spare his father publicity.

Spitzer's sense that he could fall back on legalistic justifications while skirting promises that he would operate in an exceptionally ethical fashion was on display as recently as last week. Spitzer, while technically adhering to a pledge that he would cap contributions to his own campaign treasury at $10,000, was directing big-dollar donors to send funds above that amount to the state Democratic Party, where he could still direct the money.

’A Binary World’

Beyond any possible offenses Spitzer may have committed or approved, there is a sense in his downfall of comeuppance for someone who has long used the techniques of shaming, whether publicly bad-mouthing Wall Street titans he was prosecuting or targeting his political opponents as governor.

"This is a binary world, good and bad," Spitzer told Masters.

Spitzer ultimately found himself on the wrong side of that equation. His manner as a leader — choosing to be feared rather than loved — left him with no reservoir of goodwill to draw upon amidst scandal. He illustrated the old truth that there is no fortune in acting like you are smarter, better and morally superior to all those around you when in reality you have human failings that are only magnified by your own professed superiority.

With Republicans in his state threatening impeachment — and his fellow Democrats saying they could not stand by him — Spitzer had no choice but to step down.

"I look at my time as governor with a sense of what might have been," he said in announcing his resignation Wednesday. "I am deeply sorry that I did not live up to what was expected."

Spitzer waited approximately 48 hours to resign after news broke that he had spent tens of thousands of dollars over a period of at least several months on prostitutes. Speculation centered on the question of whether Spitzer was waiting to resign to retain his post as leverage in negotiations with federal prosecutors.

Spitzer's wire transfers of thousands of dollars to the escort service known as the Emperor's Club drew the attention of bank officers and federal regulators. In investigating Spitzer's financial activity — thinking initially he might be sending money to blackmailers or engaging in political corruption — they found instead that he was soliciting sex. He was taped by federal wiretappers arranging a February appointment in Washington, D.C.

He will be succeeded by Lt. Gov. David Paterson, a former state senator from Harlem who becomes the nation's first blind governor and only its fourth African American governor.