Goldman Sachs Breaks With Government Sachs on Immigrant Ban

Updated on
  • Blankfein says immigration order has potential to disrupt firm
  • CEO joins other U.S. executives in denouncing Trump policy

Goldman’s Blankfein: We Don't Support Trump Travel Order

Goldman Sachs is pushing back against Government Sachs.

In a sharply worded message to staff, Lloyd Blankfein, the bank’s long-time head, broke with the Trump administration over its controversial attempt to crack down on immigration. The voicemail, sent Sunday to the firm’s 34,400 employees, pits Blankfein against an administration stocked with Goldman Sachs Group Inc. veterans, including his former No. 2, Gary Cohn, and key Trump adviser Steven Bannon.

Blankfein told employees that President Donald Trump’s executive order, parts of which were blocked by federal courts, is at odds with the firm’s long-held policies on workforce diversity and could disrupt Goldman Sachs’s business. “This is not a policy we support,” the chief executive officer said.

Blankfein joined a growing chorus of executives, notably from the technology industry, expressing displeasure about the order halting immigration from seven Middle Eastern countries. Google Inc. CEO Sundar Pichai slammed Trump’s move in a note to employees Friday, while Microsoft Inc. on Sunday described the order as “misguided and a fundamental step backward.”

Rare Stand

Blankfein’s comments put Goldman Sachs, one of Wall Street’s most influential firms, in the unusual position of standing against a signature effort of the new administration. Since former Chairman Sidney Weinberg served in Washington during both World War II and the Korean War, the firm has sent executives into government service, earning it the Government Sachs moniker. It seldom takes a public stand against a sitting president.

Other Wall Street firms took a softer approach. JPMorgan Chase & Co.’s operating committee, led by CEO Jamie Dimon, said in a memo to staff Sunday that it’s “grateful for the hard work and sacrifices made to keep our country safe,” and that the country was “strengthened by the rich diversity of the world around us.” It didn’t express an opinion on the policy.

Wells Fargo & Co., Morgan Stanley and Bank of America Corp. said they were monitoring the ban’s impact on employees. Citigroup Inc. CEO Mike Corbat said the lender was “concerned” about the message the order sends.

Mastercard Inc. CEO Ajay Banga, citing his own status as an immigrant, said in a memo to staff that he’s “deeply concerned” about the ban, which he said has caused a “fracture in our society.”

‘Due Process’

BlackRock Inc. “will continue to embrace our values and culture, notwithstanding the challenges created by this order,” the world’s largest money manager said Sunday in a memo to staff signed by CEO Larry Fink and other company executives. “We, of course, all want to promote security and combat terrorism, but we believe it needs to be done with respect for due process, individual rights and the principle of inclusion.”

Steve Schwarzman, CEO of the world’s largest private equity firm, Blackstone Group LP, took a pass when asked about the immigrant order’s effect on his business. “I’m not going to comment on that,” he said at a Catholic Charities luncheon Sunday, where Governor Andrew Cuomo and Senator Charles Schumer, both New York Democrats, used their remarks to about 150 guests to oppose the order.

Blankfein may have felt he had to speak up: the firm was founded in 1869 by Marcus Goldman, a German-Jewish immigrant. And like much of Wall Street and corporate America, Goldman Sachs continues to rely on employees who were not born in the U.S. It also has increasingly been positioning itself as a technology firm.

Potentially Disruptive

“If the order were to become or remain effective, I recognize that there is potential for disruption to the firm, and especially to some of our people and their families,” Blankfein, 62, said in the voicemail. “I want to assure all of you that we will work to minimize such disruption to the extent we can within the law and are focused on supporting our colleagues and their families who may be affected.”

Trump’s order prevents people from Iran, Iraq, Libya, Somalia, Sudan, Syria and Yemen from entering the U.S. for the next three months. The order led to confusion over the weekend, with some judges temporarily blocking parts of the order and the administration giving conflicting messages on its implementation.

Elisha Wiesel, who was promoted this month to oversee Goldman Sachs’s technology operations and is the son of Holocaust survivor Elie Wiesel, said Sunday that one or two employees have approached him so far about what the order might mean for them, and that he understands their concern. Wiesel, 44, said his father, who died last year, was disappointed at the U.S.’s inaction in Syria and wouldn’t have approved of the immigration order.

“In the same way he was dismayed at the lack of action over Syria, I think he would have been very disappointed at the direction this country seems to be turning,” Wiesel said.

Goldman Alumni

None of the Goldman Sachs alumni working in the administration have so far said publicly whether they support the immigration ban. Cohn is serving as Trump’s top economic adviser, while Dina Powell, head of the firm’s philanthropic arm, was named an assistant to the president. Other ex-employees include Steven Mnuchin, nominated to run the Treasury Department, who spent 17 years at the bank.

For Goldman Sachs to be successful, the company must “reflect the diversity of the communities and cultures in which we operate,” Blankfein said, quoting from the firm’s business principals. “Being diverse is not optional; it is what we must be.”