Will New York voters forgive ex-governor Spitzer?

Former New York Gov. Eliot Spitzer is mobbed by reporters while attempting to collect signatures to run for comptroller of New York City on July 8, 2013 in New York City.

Politics in our financial capital gets more interesting by the day. Anthony Weiner, the former congressman who got in trouble for tweeting lewd pictures, is running for New York mayor. And now it appears Wall Street hasn’t seen the last of Eliot Spitzer.

The former state attorney-general and governor -- who resigned amid a prostitution scandal -- is throwing his hat into the ring for New York City comptroller. Going from top pol in the state to something less than mayor is an unusual move, but Spitzer isn’t in a position to aim higher at the moment.

"It’s a demotion, obviously," says Larry Sabato, director of the Center for Politics at the University of Virginia. "If he were to run for governor again, he’d be laughed off the stage."

Still, for Spitzer, there are no small roles, only small actors, says Sabato. Fifteen years ago, Spitzer took the sleepy office of state attorney general and became the so-called sheriff of Wall Street, suing big banks for trading abuses and the head of the New York Stock Exchange for his lofty pay package.

As comptroller, Spitzer could become the shareholder activist of Wall Street.

"He is the chief investment officer, essentially, for the city, investing the city’s pension funds," says New York-based political consultant Hank Sheinkopf.

The city comptroller oversees $140 billion in pension money. Sheinkopf says Spitzer is likely to make avid use of that investment clout.

"You have the proxy power because you’re doing investment," he says. "And, therefore, you can use that to influence actions by corporations."

Public pensions, with their billions in assets, have leverage with companies. Damien Park, managing partner of Hedge Fund Solutions, notes that California's public pension system has used its muscle to oust CEOs.

"There are several public pension funds that regularly engage in activist style investing," Park says.

To lead the charge in New York, though Spitzer first has to get elected. And an intriguing opponent just joined the race: Kristen Davis, the convicted madam who claims to have facilitated Spitzer’s trysts as client number 9.

About the author

Stacey Vanek Smith is a senior reporter for Marketplace, where she covers banking, consumer finance, housing and advertising.

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