Did Blankfein Snub Paulson?

Robyn Beck/Agence France-PresseHenry Paulson, the former chief executive of Goldman Sachs, traveled to Hong Kong in 1998 to sign a deal with China’s Guangdong Enterprises.

On Wednesday morning on CNBC, Lloyd C. Blankfein, the chief of Goldman Sachs, made a rare on-camera appearance to defend the embattled firm from its detractors.

But he may have inadvertently snubbed another Goldman legend – Henry M. Paulson, Jr. – in the process.

Asked by Bloomberg TV what the future held for Goldman, Mr. Blankfein replied, “To refer back to the rise of the emerging markets and wealth creation around the world, my predecessors didn’t go to China. They called it Red China. They didn’t go to Russia or India because there were people in poverty, not people growing their businesses and trading with the rest of the world to the extent they are.”

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On CNBC minutes earlier, Mr. Blankfein also mentioned China, saying: “My predecessors didn’t go to China three or four times a year like I do.”

We’d imagine that Mr. Paulson, if he tuned in to Mr. Blankfein’s interviews, was scratching his head.

Bloomberg NewsLloyd C. Blankfein, chief of Goldman Sachs, has shied away from making news in his television appearances.

Mr. Paulson, of course, is the former Goldman chief and Treasury secretary who was famous for engineering Goldman’s push into China. Back in 2006, Mr. Paulson told The Wall Street Journal about his focus there:

I’ve been to China about 70 times since the end of 1990. I just got back from the Middle East. There are huge amounts of capital in that region. They have much more capital than investing opportunities. So there are real opportunities there.

Indeed, Mr. Paulson is among the Goldman alumni with the closest ties to China. A 2006 profile in BusinessWeek described the depth of his knowledge about the country:

Paulson does have plenty of guanxi, or connections, thanks to years of building up street cred with Beijing’s power elite. He traveled extensively to China during the 1990s on behalf of Goldman, has served as advisor to the Tsinghua University’s School of Economics and Management, and engaged in environmental projects in China’s Southwestern Yunnan Province. He’s familiar with Chinese President Hu Jintao‘s top economic team including People’s Bank of China Governor Zhou Xiaochuan and Finance Minister Jin Renqing.

After leaving Goldman, Mr. Paulson continued to deal intimately with China. As Treasury secretary, he was known for his outreach to the Asian nation, leading the Strategic Economic Dialogue between China and the United States. And after leaving office, he continued to speak and write as an expert on United States-China relations.

On Wednesday, David Wells, a Goldman Sachs spokesman, sought to stem any damage resulting from Mr. Blankfein’s omission of Mr. Paulson’s work in China. He characterized the chief’s words as pertaining to the period before Mr. Paulson’s tenure, when Goldman was a private company and had less international reach.

“Hank’s work in China ensured that all future Goldman Sachs C.E.O.’s devoted a significant amount of their time to building on his legacy there,” he said.

These, Mr. Blankfein, are the dangers of live television.

Source & Image : New York Times