George Gould, Wall Street banker and top Treasury official, dies at 94

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George Gould, the former chairman of the investment bank Donaldson, Lufkin & Jenrette who helped New York City solve its financial crisis in the 1970s and served as U.S. treasury undersecretary in President Ronald Reagan’s administration during the 1980s, died April 26 at his home in Palm Beach, Fla. He was 94.

The Quattlebaum Funeral, Cremation and Event Center in Florida confirmed the death on its website.

Mr. Gould spent much of his early career at DLJ, founding the New York-based firm’s investment management arm. “George took the investment management division from the $200 million level to the $800 million level in three years,” Richard Jenrette, one of DLJ’s founders, told the New York Times. Jenrette said Mr. Gould was a “great communicator, explaining things, selling ideas.”

In 1975, a year before he left DLJ, Mr. Gould became a member of the Municipal Assistance Corp., helping investment banker Felix Rohatyn oversee New York City’s refinancing efforts to dig out of its financial crisis. The public‐benefit corporation was created after the city was unable to borrow money for itself in the private credit market.

While serving as president of the Madison Fund, a mutual fund managing $450 million in stocks for more than 60,000 investors, Mr. Gould succeeded Rohatyn from the part-time unsalaried post as MAC chairman in January 1979. But his relations with New York Gov. Hugh L. Carey (D) grew tense because the governor reportedly continued to seek advice from Rohatyn, a partner with Lazard Frères & Co.

Mr. Gould resigned that May, but he went on to clean up the balance sheets of several other agencies, including the New York State Housing Finance Agency and the New York State Dormitory Authority.

In 1985, Treasury Secretary James A. Baker III tapped Mr. Gould as undersecretary for domestic finance, the department’s No. 3 official. Over the next three years, Baker focused on international issues while Mr. Gould dealt with domestic financial affairs such as the 1987 stock market crash, the bailout of savings-and-loan institutions and the raising of the U.S. debt ceiling.

While serving Reagan, Mr. Gould warned of a default in 1987 unless the debt ceiling was increased to allow the government to meet its obligations and continue issuing bonds. “The consequences of not having a debt ceiling increase on that date would be incomprehensible,” Mr. Gould said at the time.

His warning was a harbinger of later political standoffs. In the mid-1990s, the government under President Bill Clinton shut down as Republicans demanded an end to rising national debt. Another debt ceiling crisis occurred in 2011, rattling financial markets and prompting Standard & Poor’s to issue the first-ever downgrade of the U.S. government’s credit rating.

Described by Fortune magazine in 1986 as a “banker with a breezy manner and a knack for fixing financial problems,” Mr. Gould led the government’s efforts to recapitalize the insolvent Federal Savings and Loan Insurance Corp. The insurer of deposits in savings institutions was reeling as U.S. thrifts failed in large numbers. Mr. Gould pressed for the industry to pay for the bailout before asking taxpayers to cover the cost.

He also helped form consensus on dealing with the 1987 market crash, along with Baker, Federal Reserve Chairman Alan Greenspan and Robert Zoellick, an assistant to Mr. Gould at the time and later a president of the World Bank.

“We all agreed that it was important to inject huge amounts of liquidity into the system,” Baker said in “Work Hard, Study … and Keep Out of Politics!,” a 2006 book he co-wrote with author Steve Fiffer.

Mr. Gould also directed the government’s unsuccessful bid in Congress to let commercial banks underwrite securities, years before the repeal of parts of the Glass-Steagall Act of 1933, which effectively separated commercial and investment banking.

George Sumner Bradford Dana Gould, the son of an investor, was born in Boston on May 22, 1927. His mother’s great-uncle was the abolitionist senator Charles Sumner, a Massachusetts Republican, and he traced his New England lineage to a Bradford who arrived in 1635, according to a New York Times profile when he became MAC chairman.

His father made a living as a private investor. He was 5 when his mother died, and he was raised primarily by an aunt before going to boarding school. He graduated in 1945 from the private Phillips Academy in Andover, Mass., received a bachelor’s degree in economics from Yale University in 1951 and completed a master’s in business administration from Harvard Business School in 1955.

For the next six years, he worked in personal and philanthropic money management at Jeremiah Milbank Investments in New York before joining DLJ. In addition to his work at the Madison Fund, he was also a general partner at Wertheim & Co., a New York-based investment bank, and vice chairman of Klingenstein Fields & Co., a New York-based asset management firm serving wealthy families.

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