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12/4/2008
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Eliot Spitzer To Write On Economic Wrongdoing At Slate

In his debut column, the former New York attorney general and governor said the government bailouts of large financial services firms may be counterproductive.

Slate, the online magazine founded by Microsoft and owned since 2004 by the Washington Post, has hired Eliot Spitzer as a columnist to comment on the current state of the economy.

Spitzer previously made a name for himself while New York attorney general as a leading critic of loose financial services practices and lax regulation.

He launched several high-profile investigations of Wall Street firms, including hedge fund Canary Capital Partners, Strong Mutual Funds, Putnam Securities, and Invesco, leading to either resignations of company leaders or voluntary restitution of damages. Spitzer sought to crack down on collusion among Wall Street firms, insider trading, and a form of after-hours trading by mutual funds, called "front running," which was banned by Securities and Exchange Commission rules.

His new status as Slate columnist is the first public role he has taken after resigning as New York governor March 17, 2008, two days after his encounter with a call girl was exposed. Whether he can wield some of the same moral authority from a Slate soapbox that he once did as New York attorney general is a question that is likely to be debated and closely watched.

Indeed, as The New York Times' Opinionator column noted Thursday, public officials who resigned in disgrace used to allow a quiet period to pass before edging back into public life. Opinionator quotes Stephen Bainbridge, a UCLA professor who writes a respected legal blog, "Respect for public decency required that the miscreant retire to the country and live out the rest of their lives as a recluse, shunned by society. How far we have come in dumbing down our response to public figures behaving badly. Now we don't even require them to wait a decent interval before rejoining society."

Spitzer, however, didn't take much coaxing to get back in the public eye. Jacob Weisberg, editor in chief of the Slate Group, sought him out and proposed he write a bimonthly Slate column after reading a piece by him in The Washington Post on Nov. 16. Weisberg is an acquaintance of Spitzer's and said he had previously suggested to him that he write for Slate.

"It was not an epic negotiation," Weisberg told the New York Observer. "He was very receptive to the idea. I don't portray this as something we had to coax him into. He's got a lot to say and he was very receptive to writing on the subject."

With the economy in deep trouble and no one sure what to do, Spitzer's uncompromising voice will be a fresh addition to the debate and may in the long run prove a welcome addition. And he is sure to draw traffic to the Slate site with his high level of name recognition and controversial stands.

Indeed, his return to public life may be more of a high diving board act rather than a dip of a toe in the water. In his debut column, "Too Big Not To Fail," posted Wednesday, he said the bailouts of large financial services firms, such as Wachovia and Citicorp, may be counterproductive.

"What are we getting for the trillions of dollars in rescue funds?" he wrote. "If we are merely extending a fatally flawed status quo, we should invest those dollars elsewhere. Nobody disputes that radical action was needed to forestall total collapse. But we are creating the significant systemic risk not just of rewarding imprudent behavior by private actors but of preventing, through bailouts and subsidies, the process of creative destruction that capitalism depends on."

His column will be called "The Best Policy."

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