Brothers, Goldman Sachs, Morgan Stanley, Manufacturers Hanover, Lazard Brothers, First Chicago, Dillon Reed, First Boston, Brown Brothers Harriman, American Express, and Bank One. A second important group of finance capitalists were involved in the lucrative “shadow banking” system of private equity, mutual funds, hedge funds, and other investment vehicles, especially the biggest ones such as the Blackstone Group, Carlyle, Blackrock, the Soros Fund, and Kohlberg Kravis & Roberts. A third group are the CEOs or directors of a variety of giant corporations, including oil, pharmaceuticals, foods, telecommunications, technology, news/information, airlines, utilities, hotels, and manufacturing. Another, less common relationship to the capitalist class was as an officer with one of the Federal Reserve Banks, the New York Stock Exchange, or a principal of a major law firm. Several were also directors of insurance companies, and some also worked as directors of both financial and non-financial corporations, in financial corporations or academia, then in and out of government.
THE PROFESSIONAL-CLASS DIRECTORS
The CFR also depends upon the expertise of well-educated professionals—academics, lawyers, consultants, journalists and government officials—to develop and implement the initiatives and strategies best suited to the continuation and strengthening of capitalist-class rule. There are many former professional-class directors of the Council whose knowledge, intellectual skills, and judgment have resulted in their assimilation into the capitalist class. The primary criterion for such status is directorships in top corporations or law firms, which brings great wealth. The CFR directors discussed in depth below include several examples. It is inevitable that others, due at least in part to their connections developed as CFR board members, will in the future be brought more directly into the top levels of the corporate capitalist class either as officers or directors of leading firms or as owners of their own businesses directly serving this world. As this occurs, they will more and more directly reflect the needs, interests, and ideology of the capitalist class, and will become fully assimilated into this class.
Below is a list of the twelve longest serving CFR directors during the 1976–2014 years. Six have already been profiled here as part of the top leadership. The other six, representative of both the capitalist class and assimilating professional class directors of the Council, are profiled below.84
1. David Rockefeller, commercial banker, 36 years, 1949–1985
2. Peter G. Peterson, shadow banker, 34 years, 1973–2007
3. Carla A. Hills, corporate director, business consultant, 20 years, 1994–
4. Karen E. House, journalist, publisher, 16 years, 1987–1998 and 2003–2008
5. Maurice Greenberg, insurance executive, 15 years, 1992–2002 and 2004–2009
6. Cyrus Vance, Wall Street lawyer, 15 years, 1968–1976 and 1981–1987
7. Paul Volcker, commercial banker, 15 years, 1975–1979 and 1988–1999
8. Martin Feldstein, Harvard professor, 16 years, 1998–
9. Robert Rubin, investment banker, 14 years, 2000–
10. Richard Holbrooke, investment banker, 13 years, 1991–1993, 1996–1999, 2001–2009
11. Robert Hormats, investment banker, 13 years, 1991–2004
12. Steven Stamas, oil company executive, 12 years, 1977–1989
Karen Elliott House
In the 1987 board election, the CFR directors chose eight names from a list of over two hundred individuals suggested by Council members for eight seats on the board. These were Karen Elliott House, Richard B. Cheney, Robert F. Erburu, Donald F. McHenry, Peter G. Peterson, William D. Rogers, Glenn E. Watts, and Walter B. Wriston. In the election held in April 1987, all eight were elected by the members.85 House, who first became a CFR member in 1978, immediately began to serve on the membership committee of the board, a committee she frequently served on in subsequent years, but was also on the Executive and Foreign Affairs committees.86 House also showed her support for the organization by frequently contributing between $1,000 and $10,000 (above and beyond regular dues) to the organization as part of the “Annual Giving” fund drive.87
House, who started out as a journalist with the hawkish, neoliberal Wall Street Journal—rising successively to foreign editor (1984), president of Dow Jones International (1995), and publisher of this newspaper in 2002—represents an example of the professional class rising into the ranks of the capitalist class. Her expertise was the Middle East, especially the oil giant Saudi Arabia, and for decades she wrote prize-winning stories and then a book on this part of the globe. Her knowledge and insight, especially into the inner workings of the powerful Saudi monarchy, was likely one of the things that made her valuable to the Council and its leadership. She also spent time as a senior fellow at Harvard’s Belfer Center, endowed by CFR member Robert A. Belfer, part of the family that owned and controlled Belco Petroleum, which merged with another company to form Enron.
Paul A. Volcker
Educated at Princeton, Harvard, and the London School of Economics, Volcker spent his career as a banker, especially at the Chase Manhattan Bank where he reached the status of vice president, and within the federal government, mostly in the Treasury Department, but also as president of the Federal Reserve Bank of New York (1975–79) and chair of the Board of Governors of the Federal Reserve system (1979–87). He served as a CFR director before and after being head of the Fed. As chair of the Federal Reserve, he had an important role in the rise of neoliberalism, which will be discussed in chapter 5. He has had strong connections to the Rockefeller family for many years, working as an assistant to David Rockefeller at Chase Manhattan, then later as one of several trustees directly overseeing the Rockefeller family fortune. Volcker was also chair of the Group of Thirty, a founding member of the Trilateral Commission, and a longtime member of the Bilderberg Group.
Martin S. Feldstein
Feldstein is another example of an academic who recently successfully made his way into the capitalist class. He received his BA at Harvard and earned a PhD at Oxford. An economist, for thirty years he was president and CEO of the National Bureau of Economic Research, with time out to serve as chairman of Ronald Reagan’s Council of Economic Advisers (1982–84). He was also a professor of Economics at Harvard for many years. While serving in these public and private positions, he was on the boards of directors of several major corporations, among them JPMorgan, TRW, Eli Lilly, and American International Group (AIG). He served for twenty-two years on AIG’s board and a decade on the Lilly board. Income plus stock options from his service on corporate boards together with his income from other sourses, such as Harvard University, the Bureau of Economic Research, and the federal government, allowed his net worth to grow substantially over recent decades.88 At the same time he was receiving large compensation packages from multiple sources, Feldstein, as a conservative economist, was avidly advocating the privatization of Social Security as part of “entitlement reform.” Equally hypocritical, he was on the board of directors of AIG when it received a taxpayer-funded bailout from the federal government amounting to no less than $185 billion, at least some of which likely went into his own pocket in the form of a large compensation package. Feldstein is also well connected internationally, serving on the Trilateral Commission and Group of 30.
Richard C. Holbrooke
Holbrooke was initially part of the professional class, serving in the federal government. He then was recruited to top corporate boards in the financial sector, thereby rising into the capitalist class. He received his BA from Brown and immediately went into the Foreign Service, becoming an expert on Vietnam. During the 1962–69 years he worked on a variety of tasks as part of the U.S. counterinsurgency war, starting with rural “pacification” in the Mekong Delta, then “Operation Phoenix,” which organized the murder of tens of thousands of Vietnamese. Holbrooke also advised the U.S. ambassadors in Saigon, as well as President Johnson, and he ended this period in his life with the Paris Peace Talks as well as writing a volume of the Pentagon Papers. During the 1970s he was a journalist