Former Ambassador Phil Murphy and Jersey City Mayor Steven Fulop have two main things in common: they both used to work for Goldman Sachs and they both want to be the next Governor of New Jersey. As the two duke it out for the Democratic Party nomination (along with other contenders like Senate President Steve Sweeney) PolitickerNJ decided to explore how that time on Wall Street might impact how the governorship gets approached on State Street.
Murphy rose through the ranks at Goldman over the course of a 23-year career. In 1993, he headed the firm’s Frankfurt, Germany office. Later, he was promoted to head the Asia office. He retired in 2006 after a three-year turn as Senior Director.
According to Charles D. Ellis, author of The Partnership: The Making of Goldman Sachs, “Nobody would want to compete with Phil.”
In his book, Ellis briefly chronicles Murphy’s rise through the firm, including his transformation of the firm’s patient client services (PCS) business model.
“…Murphy converted PCS from the entrepreneurial business model… into a corporate design in which PCS people were ‘asset gatherers’ and the investing was increasingly done by the firm,” Ellis wrote in his book. The repercussions of the change led by Murphy streamlined the once-individualized system at Goldman Sachs into a large organizational effort.
According to Ellis, changes like those made Murphy a strong leader.
“Phil is super bright and was widely respected not only for his brainpower, but also his integrity and leadership,” Ellis told PolitickerNJ. “Of course, in the great tradition of Goldman Sachs, he made it very clear that only your very best was acceptable. Importantly, he has a special ability to inspire teamwork. Strong as a strategic thinker, he worked from within to make the firm stronger and stronger.”
According to Ellis, Murphy would employ those same skills as Governor, if elected.
“He has been comparably effective in politics for the same reasons,” said Ellis referring to Murphy’s high-powered fundraising for the likes of Obama that eventually led him to be appointed as the Ambassador to Germany. “Personal opinion, he would be a great governor.”
Fulop existed in the trenches of the day-to-day at Goldman Sachs. He was a trader on Wall Street where he figured out what to buy and sell for Goldman. Unlike Murphy, however, Fulop never took the time to rise through the ranks of the company and achieve the high status of his now opponent for the bid.
In 2001, Fulop was working in the lower Manhattan Goldman office when the attacks on the World Trade Center happened. He put his career on hold to enlist in the Marine Corps, eventually deploying to Iraq.
When he came back in 2006, he briefly went back to Goldman but then shifted his position to another financial firm: Sanford C. Bernstein & Co.
While their careers took different paths, the two also have had a markedly different ascension into the political sphere. While Murphy got into politics through his powerful connections (namely, the DNC and President Obama) Fulop fought tooth and nail to position himself for governor. In 2004, Fulop ran for Congress against then-Congressman Robert Menendez under the guidance of then Jersey City Mayor Glenn Cunningham who died in the lead up to that election. He lost.
But, despite that setback, Fulop didn’t give up on politics. He ran for Jersey City council in 2005 and won. He served for eight years before making the natural climb to mayor in 2013, taking down the administration of incumbent Mayor Jerramiah Healy.
While their stories might seem different, there is one thing that appears to tie the two together: ambition.
According to William D. Cohn, author of Money and Power: How Goldman Sachs Came to Rule the World, jobs like the ones held by Fulop and Murphy at a company with so much power and influence, in reality have little do with the next step so many former employees take to politics. However, according to Cohan, it is really the mindset that it takes to make it at such an institution that influences that decision.
“It is not that anything that happens at Goldman qualifies them for anything, except maybe to work at Goldman,” Cohn told PolitickerNJ. “I don’t know if there is anything in particular that qualifies Goldman people to think they can serve in elected office, especially high elected office. However, there is a philosophy at Goldman a. towards public service and b. that you will only be at Goldman for a certain amount of time, especially as a partner. You get ten years or so as a partner and then they kick you out. That is unusual on Wall Street. It is a bunch of wealthy, youngish people who are used to succeeding and think they are invincible and can win at anything they put their mind to.”
While Murphy and Fulop are both pursuing the governorship, they are not the first Goldman Sachs alums to do so. Former Governor Jon Corzine, like Murphy, was also formerly a high-level executive at Goldman Sachs. In fact, the two worked fairly closely together during their time there, with Corzine picking Murphy as his choice to head the Asia office, according to The Partnership.
While Cohan claimed that ambition is a cornerstone of a Goldman employee, he also remembered Corzine as someone who took that ambition to politics and, now, is widely regarded as a failed politician. He lost in his reelection campaign to now-Governor Christie, a Republican, in 2009.
“There was a former head of Goldman who was a governor and Senator in New Jersey and that didn’t work out so great,” Cohan said of Corzine. “They have the money and the drive and the determination and the confidence and the ego to think they can win so that’s why they do it.”
It seems that Corzine’s ambition may have led him astray. He believed he could do the job but, when push came to shove, running a state was less like running the internal mechanisms of a megabank than he anticipated. Further, Corzine is thought to have used his significant wealth as a main vehicle for his election. He pumped over $62 million into his initial senate campaign in 2000, leaving few able to compete financially. But that wealth couldn’t be a crutch once elected senator and then governor in 2005, leaving him open to a challenge from Christie.
Corzine’s errors, however, don’t indicate that Murphy or Fulop will head down the same path. However, that connection might provide fodder for other candidates who are also looking at the statehouse in 2017.
Senate President Sweeney is unlike his two main foes in that his background puts him as far from Wall Street as you can go in the Garden State. Sweeney is a union ironworker by trade. Unlike Murphy and Fulop, he represents South Jersey in the race for Governor.
With Goldman’s “too big to fail” bailout from 2008 still in recent memory, it is possible that Sweeney or other hopefuls like state Senator Ray Lesniak or Assemblyman Jon Wisniewski could use their competitors’ past positions as leverage. Also, as an “everyman” candidate, if Sweeney were to distance himself from the money and power associated with Wall Street, he could appeal to the middle class voter base over Fulop or Murphy.
While the 2017 race is still almost two years away, for now, all the candidates seem equally enthusiastic about their pursuits. But, for the Goldman alums, connections like those forged during their time in the financial world might provide a significant fundraising base, narrowing the race for who will get the eventual nomination.