The former president of the of the European Commission – the EU’s unelected executive arm- has being recruited as the new boss of Goldman Sachs’ international operations.
José Manuel Barroso, who was prime minister of Portugal from 2002 to 2004 and the Commission’s president between 2004 and 2014, was appointed last Friday as chairman and a senior adviser at the international arm of the U.S. investment banking powerhouse.
Goldman Sachs funded the official anti-Brexit campaign.
The American investment bank, which was accused of “serious misconduct” and agreed last month to pay out $5.06bn for its role in the 2008 financial crisis, is to hire José Manuel Barroso, the former Portuguese prime minister and most powerful man in the EU
Mr. Barroso, who was president of the European Commission for 10 years until 2014 and presided over the Eurozone crisis, will help the Wall Street giant manage the so-called “fall out” from Brexit as well as other international uncertainties. His pay has not been disclosed.
During his time as President of the Commission he persistently attacked Eurosceptics, including David Cameron when he announced that the British people would have a democratic say on their membership of the block.
The bank has a long history of hiring EU bureaucrats. Mr. Barroso takes the job from Peter Sutherland, a former European Commissioner and ex-boss of the World Trade Organisation, who left last year.
Mr. Sutherland’s anti-democratic and anti-Brexit rhetoric has been even more inflammatory. After the Brexit vote was announced, he called for it to be “overturned”.
The younger generation in UK has been sacrificed all because of distortion of facts & consequences. Somehow this result must be overturned.
— Peter Sutherland (@PDSutherlandUN) June 25, 2016
In May, in the run-up to the referendum, figures released by the Electoral Commission revealed that Goldman Sachs had quietly donated £500,000 to Britain Stronger in Europe – the official, government back anti-Brexit campaign – shortly before February when donations had to be declared.
Speaking to the Financial Times, Mr. Baroso said he would attempt to mitigate any negative effects of Brexit in his new role with the bank.
“Of course I know well the EU, I also know relatively well the UK environment,” he said. “If my advice can be helpful in this circumstance I’m ready to contribute, of course”.
He claimed that one of the most difficult areas of the Brexit negotiations would involve trade and access to the single market. “What I know for sure is that on both sides it will be intelligent and wise to have a fair negotiation,” he told the FT. “Nobody wins from a confrontation.”
While he was head of the European Commission, Mr. Barroso oversaw the banking crisis and the ensuing fallout that gripped the eurozone.
“As president of the EC, I was leading an overall effort of regulation and supervision, including the creation of banking union in the euro area, to bring back stability, credibility to the financial sector,” Mr. Barroso added.
According to Politico, Barroso’s new job at Goldman Sachs has angered the EU, with some MEPs calling for sanctions over his failure to ‘behave with integrity and discretion.’
In a statement Monday, the French Socialist delegation to the European Parliament called for sanctions on Barroso by cutting his pension from the Commission when he reaches 65 years of age. He is now 60.
Such a penalty is possible under article 245 of the Treaty on the Functioning of the EU, which says European commissioners must “respect the obligations arising therefrom and in particular their duty to behave with integrity and discretion as regards the acceptance, after they have ceased to hold office, of certain appointments or benefits.”
In case of a perceived breach of this rule, the Commission or a simple majority of countries within the Council of the EU can launch a legal procedure against Barroso. When he was appointed Commission president he pledged to the European Court of Justice to uphold his duties according to the Treaty.
A diplomatic source told POLITICO it was probably too soon for the Council of the EU to discuss the matter. As for the Commission, it neither announced nor ruled out the possibility of issuing a legal opinion on the matter at a press conference Monday.
Goldman Sachs International has a complicated history with EU officials. Mario Draghi, the president of the European Central Bank, Carlos Moedas, the new Portuguese commissioner for research, science and innovation, and Mario Monti, the former European commissioner for competition, also spent time working for the U.S. bank.
During the Greek economic crisis Goldman Sachs was criticized for having helped Athens hide its financial situation in order to enter the eurozone in 2000.