In 2006, Hank Paulson left his position as Chairman and CEO of Goldman Sachs to become Treasury Secretary. When he left Goldman, Paulson had to liquidate his entire portfolio of stocks and take a pay cut from $40 million per year to $183 thousand. When he liquidated his portfolio, he did not pay capital gains taxes. His shares were worth $491 million, which means he saved over $200 million in taxes. Some believe he took the position in order to provide inside information to his friends on Wall Street. It's possible that Paulson saw the writing on the wall, as chief executive of a firm deeply entrenched in mortgage-backed securities, and left in order to protect the banks. I find it likely that all of these factors influenced Paulson’s decision to become Treasury Secretary. Despite his ulterior motives, I am convinced Paulson’s response to the financial crisis prevented a global depression.
I see Hank Paulson’s greatest leadership skills as his flexibility and willingness to assess matters on a case-by-case basis. He did the best he could to weather the storm of the financial crisis and minimize impact on the global economy. I also believe he exhibited Wall Street greed in his position as CEO of Goldman Sachs and his decision to transition to Treasury Secretary. We can study the faults of leaders while acknowledging when they perform well in crisis situations.
In 2006, Hank Paulson left his position as Chairman and CEO of Goldman Sachs to become Treasury Secretary. When he left Goldman, Paulson had to liquidate his entire portfolio of stocks and take a pay cut from $40 million per year to $183 thousand. When he liquidated his portfolio, he did not pay capital gains taxes. His shares were worth $491 million, which means he saved over $200 million in taxes. Some believe he took the position in order to provide inside information to his friends on Wall Street. It's possible that Paulson saw the writing on the wall, as chief executive of a firm deeply entrenched in mortgage-backed securities, and left in order to protect the banks. I find it likely that all of these factors influenced Paulson’s decision to become Treasury Secretary. Despite his ulterior motives, I am convinced Paulson’s response to the financial crisis prevented a global depression.
I see Hank Paulson’s greatest leadership skills as his flexibility and willingness to assess matters on a case-by-case basis. He did the best he could to weather the storm of the financial crisis and minimize impact on the global economy. I also believe he exhibited Wall Street greed in his position as CEO of Goldman Sachs and his decision to transition to Treasury Secretary. We can study the faults of leaders while acknowledging when they perform well in crisis situations.