By  John Gizzi
Remember Woody Allen’s hit movie Zelig?  Done through superimposing Allen’s eponymous hero in newsreels of the 1920s, one saw Leonard Zelig meeting Presidents Hoover and Coolidge, playing golf with Bobby Jones, at the Vatican with Pope Pius XI, and at Yankee Stadium with Babe Ruth.

Watching Zelig in repeated scenes with the famosos of his day, the filmgoer wonders: “What on earth is he doing there?”

That’s how many who watch Wall Street felt this week as former Secretary of the Treasury Robert Rubin was shown with the rest of the now familiar financial team that is going to oversee the bailout of Citigroup.  After serving on the board of Citigroup for nearly a decade, what is Bob Rubin doing in guaranteeing prospective losses of $306 billion for one of the nation’s largest financial firms?  What on earth is he doing there?

Recalling how Rubin left the Treasury portfolio in 1999 to work at Citigroup with then-chief executive Sandy Weill, Steven Pearlstein wrote in the Washington Post November 25 that Rubin “quietly worked the back-channels while serving as strategic counselor to the chief executive and board of directors.”

“Cagey” is how Pearlstein characterized Rubin’s description of his role at Citigroup.  As he put it, “at one point, he got caught making a phone call to the Bush Treasury in a bid to help of Enron, a Citi client during its death throes.  What is indisputable is that all of the decisions that have led to Citi’s recent troubles were taken while Rubin was chairman of the executive committee and made by executives with whom he worked closely [emphasis added].”  

Rubin, according to Pearlstein, “defended them repeatedly and unequivocally, and as a director, he approved compensation packages that rewarded them (and himself) handsomely for judgments that proved disastrous.”

At this point, with Treasury Secretary Hank Paulson and Treasury Secretary-designate Timothy Geithner, Rubin is charged with guiding the initial bailout of $45 billion in new capital to rescue Citigroup.  What is most startling, Pearlstein concludes, “is that Rubin and other directors and top executives have been allowed to remain at the helm. . .Why weren’t they dispatched as were the executives at Fannie Mae, Freddie Mac, and AIG?”

As in the case of Zelig, what on earth is this man doing there?