Spitzer falls farther and faster than his targets

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History will be made Monday when the resignation of Gov. Eliot Spitzer takes effect and Lt. Gov. David A. Paterson becomes the first African-American governor in the state’s history.

Paterson, who is also legally blind, is seen by both Democrats and Republicans, as a bright and congenial person, someone whose style is the opposite of Spitzer’s a politician known for taking no prisioners.

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Playing out the final scene of an almost Shakespearean drama, New York Gov. Eliot Spitzer resigned in disgrace today after revelations that he had been caught on wiretaps arranging to meet a high-priced call girl in a Washington hotel.

He said he was stepping down effective Monday and that Lt. Gov. David A. Paterson would be sworn in to replace him.

The onetime prosecutor and leading Democratic politician was brought down by a federal sting that resembled so many he had masterminded himself against Wall Street titans and even several prostitution rings.

Banking experts noted the irony that an automated financial reporting system for the banking industry that Spitzer had supported, and that he had used as a prosecutor, was the very thing that led to his downfall.

But like so many of those combative, alpha males whom he went after as a state attorney general, Spitzer seemed to believe he was above the law - or perhaps was too smart to get caught out. More amazing, he seemed oblivious to his vulnerability from an ever-growing list of enemies who would be happy to see him humiliated.

“You would think if you’re going to make enemies in every nook and cranny of New York life, that you would be a little more protective of your back,” veteran political reporter and editor Wayne Barrett said on NPR this morning.

Not surprisingly, Spitzer’s downfall was savored by those whom he had battled with and often vanquished.

“We all have our own private hells. I hope his private hell is hotter than anybody else’s,” said Home Depot co-founder Ken Langone, who was sued by Spitzer after approving a $140-million pay package for former New York Stock Exchange chairman Richard Grasso.

Now Spitzer joins his own former targets in the public hall of shame, among them:

· Grasso, who had been hailed as a hero after he presided over the reopening of the New York Stock Exchange after the attacks of September 11 2001. But in 2003 an outcry over his $100-million retirement compensation package was followed by a civil suit from Spitzer’s office. A New York appeals court dismissed 4 of 6 claims in 2007.

· Jack Grubman, once the top telecom analyst on Wall Street who was famously humiliated after Spitzer published e-mails in 2002 suggesting he might have altered his stock picks to help his twin daughters get into an elite New York nursery school. Grubman also claimed in the e-mails that his 1999 picks were intended to help Sanford Weill win a power struggle at Citigroup. He paid a $15 million fine and was banned from working in the securities industry.

· Henry Blodget, formerly an internet analyst with Merrill Lynch. Blodget became an example of conflicts of interest in 2002 when Spitzer published e-mails from him and other Merrill Lynch employees privately denigrating internet companies they were publicly recommending to investors. Blodget paid $4 million in fines, and was banned from the securities industry.

· Maurice “Hank” Greenberg, the former chairman of American International Group who was forced to resign in 2005 amid accounting irregularities that emerged from a wider investigation of the sector by Spitzer. AIG reached a $1.6 billion settlement.

· Sanford Weill, who had built Citigroup into a global financial titan, but whose final months as chief executive officer were overshadowed by Spitzer’s probe into the relationships between equity research analysts and investment bankers during the internet boom years. Under a 2002 settlement with Wall Street banks, Citigroup paid a $400 million fine, and Weill was forbidden to communicate directly with his company’s equity research analysts.

· Jeffrey Greenberg, who resigned as chief executive officer of Marsh & McLennan Cos in October 2004, 11 days after Spitzer accused the insurance broker of rigging bids and colluding with insurers to fix prices.

· Entercom Communications Corp., one of the nation’s largest broadcasters, which agreed to a multimillion-dollar payment to end Spitzer’s investigation of gifts by record companies in exchange for air play.

· MetLife Inc., the largest group life insurer in the nation, which agreed to pay a multimillion-dollar settlement and change some of its business practices to end an investigation of payments made to brokers to steer clients its way. Spitzer’s probe of the industry began in 2004 and more than 20 insurance companies agreed to pay more than $3 billion.

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