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Wall Street Superman to the Rescue

Hedge-fund billionaire Tom Steyer is succeeding where other richer-than-thous have failed: winning elections with an MBA mentality.

Steyer, whose net worth is estimated to be around $1.3 billion, bankrolled the passage of Proposition 39—and who knows what his next target will be?

Indeed, in an election in which wealthy people were universally vilified and defeated, from the private-equity-championing Romney to the meddling Charles and Molly Munger to the Proposition 33–backing insurance magnate George Joseph, this calculated preemptive strike may have saved Steyer from a similar fate. When I asked Schnur why Steyer was not tarred and feathered as a rich dilettante, he unhesitatingly answered, “No one wanted to buy any tar or feathers.”

Nathan Ballard, the campaign adviser for the Mungers’ unsuccessful Proposition 38, agrees that Steyer was wise to neutralize the opposition. “Going after other rich guys,” he points out, makes it easier to escape the “millionaire’s curse.” Steyer, he adds, “didn’t really step on anyone else’s toes. Molly was trying to improve education, but in the process earned the ire of the governor and the Sacramento establishment.”

Steyer wouldn’t necessarily disagree. He told the audience at a November 13 event for the Public Policy Institute of California that Prop. 39 addressed “a really obvious loophole” and that the innovation it would fund was “low-hanging fruit.” But Lehane has a different theory as to why Steyer wasn’t personally attacked: “First and foremost, he has won. When you win, that impacts an awful lot of perceptions.”

Apparently, winning has changed even Steyer’s own perception of his future. On December 31, he will resign as comanager of Farallon Capital Management because, he says, he is “very wound up” about California and energy issues and would like to devote more time to them. When he told me, however, that he “has no idea” specifically what he’ll be doing next, it was the only time during the interview that he seemed slightly disingenuous. Asked at the institute event whether he would run for governor of California, he answered evasively: “I would only do that if I thought there was something really dreadfully wrong, and there wasn’t somebody who was absolutely positioned to fix it.”

At his office, I asked Steyer if he would consider either Lieutenant Governor Gavin Newsom or Los Angeles mayor Antonio Villaraigosa (both shoo-ins to run for governor in a post–Jerry Brown era) a viable option. He chuckled. “Those are both smart, nice guys, but I’m not even thinking about 2018,” he said, referring to the year when a hypothetical second Brown term would end.

“Can you imagine Congress?” I pushed.

“I couldn’t imagine that. It’s hard for me not to think of myself as an entrepreneur. But could I imagine holding down a job in a huge institution? Yeah.”

As it happens, one big institution where Steyer might imagine himself working is about to have some vacancies: the Obama administration. Treasury Secretary Timothy Geithner and Energy Secretary Steven Chu are both said to be planning their exits, and Steyer’s name, which was on many pundit watch lists for the treasury in 2008, is again being floated for a cabinet post. He remains friendly with his Goldman Sachs colleague Rubin, is a passing acquaintance of Rubin’s former boss, Bill Clinton, and put on a 2008 fundraiser that brought in almost $8 million for Obama in one night. It all adds up to a small but legitimate chance for a cabinet post—that is, if he decides to pursue it.

And why shouldn’t he? After years of failed campaigns by business titans like Meg Whitman, Carly Fiorina, and, most recently, Romney, with their unrealized promises to “run government like a business,” Steyer’s unique skill is to see government like a business: with a mission statement, competitors, and products to sell to customers in the marketplace. As Lehane puts it, “What distinguishes Tom is that as he has achieved enormous financial success, and he has channeled his skills into actions to help people.” The operative analogy, once again, is the superhero: the mild-mannered, gluten-intolerant regular guy by day who rolls out the big thinking, and the even bigger assets, by night. Smirking may be the only thing he can’t do.


Originally published in the January 2013 issue of San Francisco.

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