The WSJ has an article about James Lambright, the chief investment officer of the TARP program. It seems that Mr. Lambright is, according to the article, “Tall, bald and blunt”. While I can’t claim the tall attribute, I am definitely bald and I’m told, sometimes blunt. But I don’t have the power that Mr. Lambright wields:

As the government continues to pour cash into the economy, Mr. Lambright, 38 years old, has become one of the most powerful men in American finance. Unknown to most outside the Treasury building, he’s an embodiment of how power in the economy has shifted — for good or ill — to Washington.

The chief investment officer of the Troubled Asset Relief Program has engineered $350 billion in deals for the U.S. government since October, more than many investment banks would do in a good year. His team interviews candidates for company board seats. Top executives regularly call him and his team for advice.

If you believe the government bailouts are necessary, then I guess this is exactly the kind of guy you want in this job. The question though is whether we want someone to wield so much power over private industry. Do we want the government doling out advice and interviewing board candidates? If we hadn’t started all this with the Bear Stearns bailout, we wouldn’t need to vest so much power in one individual. And he wouldn’t get to act like a tough guy:

As December drew to a close, Mr. Lambright’s team had $48 billion worth of deals to finalize, including the $20 billion for Citigroup, $4 billion for General Motors Corp. and $15 billion of capital injections into various banks.

Many of the companies wanted their money in hand before the end of the year. On New Year’s Eve, Mr. Lambright was fielding one phone call after another, including the tense call with Mr. Crittenden of Citigroup. Before Treasury could wire the $20 billion to Citigroup, it needed waivers from about 50 executives allowing the government to curb their pay. The Treasury had been requesting the documents for about two weeks, but several were still missing.

“This is good news,” Mr. Lambright told Mr. Crittenden, according to several accounts of the call. “This tells me you don’t really need the money. Let’s talk next year.” The waivers arrived within hours.

A little later, Mr. Lambright was on the phone with Mr. Young of GM, haggling over some details the Treasury was demanding. Mr. Lambright was in no mood to negotiate.

“You’re our third-biggest deal of the day,” Mr. Lambright told GM’s chief financial officer, according to three people familiar with the call. “So if you don’t want to do this now, we have plenty else to do. Call us later.”

GM agreed to the government’s offer, and received its cash before the New Year.

I think one of the things that got us in this mess is that large companies and particularly large financial companies, have too much influence in DC. That influence has now been exercised so these businesses don’t have to accept the consequences of their bad decisions. They reaped the rewards during the good times, but taxpayers have to foot the bill now that things aren’t working out as their models predicted. These same businesses may complain about the restrictions, but they accept them because the alternative is bankruptcy court which would impose much harsher terms.

I hope that Mr. Lambright is as selfless as this article makes him seem, but I have my doubts. I always assume that public “servants” respond to the same incentives as those in the private sphere. Prestige, power and the prospect of highly renumerated future employment are strong lures for someone in Mr. Lambright’s position.