Get All Access for $5/mo

In Defense of the Revolving Door Is Robert Khuzami's move from the SEC to Kirkland & Ellis such a bad move for government or the private sector?

By Ray Hennessey Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.

What's wrong with a revolving door?

There is much hand-wringing over news that Robert Khuzami, the former chief enforcer at the Securities and Exchange Commission, has taken a private-sector job at law firm Kirkland & Ellis, generally to defend companies against actions brought by the SEC. It has been criticized as being a "revolving door" move that highlights the cozy relationship between regulators and the regulated companies they hope to work for someday.

In reality, though, it is the kind of move that can help both the private sector and government alike.

Khuzami has played both sides of the public-private buffet. He was a federal prosecutor first, then joined Deutsche Bank in 2002. In 2009, he went back into public service at the SEC -- where he was immediately criticized for not being tough enough on Deutsche Bank for its role in the housing-market collapse.

Truth be told, Khuzami was actually innovative at the SEC. He restructured the enforcement division, with a clearer focus on targets and a better use of its small resources. Those were the kinds of things that caught the private-sector's eye -- probably because he learned resource maximization and efficiency in the private sector to begin with.

If he had been a career bureaucrat, as some of the revolving-door critics would hope, he would be of little use to the outside world. And while Khuzami is getting the negative attention, similar moves are happening across the country, at all levels. How many tax firms employ former examiners from the Internal Revenue Service? How many retired colonels work at defense contractors? Dollars to donuts, your trademark attorney spent some time working with the Commerce Department. The private sector values the experience and picks away the best of the bunch. "The best minds are not in government," Ronald Reagan once said. "If any were, business would steal them away."

So Kirkland & Ellis is stealing away Khuzami, to the tune of $5 million a year. The government wouldn't pay anywhere near that -- nor should it, if it is going to rely on tax dollars for the bulk of its revenue -- but the private sector can, and does, when it feels it is worth it.

Locking the revolving door prevents government from applying the valuable experience of someone from the private sector, while also stopping companies from attracting the best and the brightest public servants. Both sides would suffer.

Related: How the SEC and Bloomberg Are Embracing Social Media

Ray Hennessey

Editorial Director

Ray Hennessey is editorial director of Entrepreneur.com. He writes frequently on leadership, management, politics and economics.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Business News

Amazon Is Reportedly Tracking 'Coffee Badging' Workers and Their Real In-Office Hours

Leaked Slack messages showed employees had a minimum number of hours they needed to be in the office for the time to count as an in-office day.

Side Hustle

This Former Disney Princess Lived 'Paycheck to Paycheck' Before Starting a Side Hustle at Home — Now She Makes $250,000 a Year

Victoria Carroll's income was "sporadic" until a friend encouraged her to take her talents to Fiverr in 2018.

Leadership

I Was Reappointed as CEO to Drive My Company's Profit — Here Are The First 3 Things I Did to Make That Happen

When stepping into a new CEO role, striking the right balance between listening and action is the key to moving the business forward

Leadership

He Didn't Want to Lead His $1 Billion Business the Same Way Anymore — Here's How the High-Stakes Switch-Up Paid Off

Advait Shinde, co-founder and former CEO of educational software company GoGuardian, was ready for a change. So was former COO of LegalZoom Rich Preece.

Starting a Business

3 Things to Consider Before Your Perfect Business Partner Becomes Your Perfect Disaster

There are many reasons for start-up businesses' high failure rate, including lack of cash, not doing enough research and poor marketing. But this one reason is definitely not getting enough attention.