Military generals report for duty on Wall Street

On a recent Thursday, Gen. Mark Milley prepared to talk about a dangerous world before a group of private-equity executives gathered at the Metropolitan Museum of Art. But first, a nod to his post-Pentagon turn.

“I spent my career in a socialist organization,” he told them, joking about the Army’s hierarchy and cradle-to-grave healthcare. “I’m just settling into capitalism.”

Milley retired last fall as the country’s highest-ranking military officer and now advises JPMorgan and its clients on geopolitical risk. Wars in Ukraine and the Middle East, tensions in the South China Sea, and the rise of protectionism, have put a premium on roles like his at financial firms, which see both risks and opportunities in a more perilous and fractured world.

The revolving door between the Pentagon and the business world has always been a busy one. But Wall Street is beckoning now, too, offering big pay bumps and access to a lucrative lecture circuit.

“We talk a lot about a soft landing for the economy,” Adm. James Stavridis said in an interview with Semafor. “I get asked a lot about a geopolitical soft landing. These issues are affecting markets in a way they haven’t since 9/11,” the former NATO Supreme Allied Commander who now works at Carlyle added.

John Raymond, former head of the U.S. Space Command, joined Cerberus last year. Milley’s predecessor, Joseph F. Dunford, joined Steven Mnuchin’s firm, Liberty in 2022. David Goldfein, former Air Force Chief of Staff, joined Blackstone in 2021. Bill McRaven, who ran the US Special Operations Command and planned the raid to kill Osama bin Laden, is at Lazard. Gen. Richard D. Clarke retired as Commander of US Special Operations and joined venture firm Human Capital, which backed defense tech firm Anduril. (“We beat them all to it,” said Gen. David Petraeus, who joined KKR more than a decade ago.)

The number of finance roles requiring an intelligence background has risen by 30% in the last year, according to the UK-based recruitment firm SSR Personnel. A recent investor poll by Natixis, the French investment bank, found their biggest worry wasn’t inflation or sputtering economies, but “geopolitical bad actors” capable of upending markets with a single act of national self-interest.

In 2020, Carlyle wanted to grow its shipyard business, which had bases in Portland, Ore. and Norfolk, Va. Stavridis’ advice: Look west. “The Pacific fleet is going to be the dominant center of gravity for the Navy,” he recalled in an interview. One of Carlyle’s portfolio companies ended up buying a major shipyard in San Diego, and last February it sold the combined business for four times what it paid, a person familiar with the transaction said.

Petraeus, a four-star general and former CIA director, said his group has vetoed between five and ten deals over the years. “It helps to have commanded two wars, which had sizable coalitions and whose countries still value the relationship [with the U.S.],” he said.

Think tanks are also fielding more interest from investors, Mark Cancian, a senior adviser at CSIS, said in an interview squeezed in during a break in a series of war games he was running on whether a Taiwan Strait crisis could go nuclear. “They’re saying, okay, if the Chinese took over the island, could we live with that, what would that look like for us?”

Sen. Elizabeth Warren, a longtime critic of revolving doors, last year proposed a bill to require more transparency about what defense officials get up to after retirement — particularly work for foreign governments.

“Former Pentagon officials working for Wall Street firms secretly leveraging their relationships with government officials is wrong and could jeopardize our national security,” Warren told Semafor. “We need to close all the loopholes that allow this kind of influence-peddling to be hidden from the public.”

Senior British government officials, including military or intelligence officers, need government approval for any jobs they take within two years of retiring, and the committee in charge of vetting them take their job seriously. Last month it accused former Prime Minister Boris Johnson of breaking lobbying rules when, as an adviser to hedge fund Merlyn, he met with Venezuelan leader Nicolas Maduro. (You can read Johnson’s correspondence with committee member Lord Pickles here.

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