From Middlebury, Rohatyn joined the New York office of the investment bank
Lazard Frères under
André Meyer. In 1950, he was drafted into the
United States Army for two years
New York City fiscal crisis When the City of New York ran out of money in mid-April 1975,
Governor of New York Hugh Carey advanced state funds to the city to allow it to pay its bills, on the condition that the city turn over the management of its finances to the State of New York. Carey appointed Rohatyn to head a
blue-ribbon advisory committee to look for a long-term solution to the city's fiscal problems. The advisory committee recommended the creation of the
Municipal Assistance Corporation (MAC), an independent corporation which was authorized to sell bonds to meet the borrowing needs of the city. While the deficit increased to $750 million, the MAC was established on June 10, 1975, with Rohatyn as chairman, and a board of nine prominent citizens. The MAC, led by Rohatyn, insisted that the city make major reforms, including a
wage freeze, a major layoff, a subway fare hike, and charging tuition at the
City University of New York. A state law converted the city sales tax and stock transfer tax into state taxes, which when collected were then used as security for the MAC bonds. Because the MAC did not create enough profit fast enough, the city created an Emergency Financial Control Board to monitor the city's finances. But even with all of these measures, the value of the MAC bonds dropped in price, and the city struggled to find the money to pay its employees and stay in operation. In November 1975 the federal government stepped in, with Congress extending $2.3 billion in short-term loans in return for more stringent measures. Rohatyn and the MAC directors persuaded the banks to defer the maturity of the bonds they held and to accept less interest, and convinced banks to buy MAC bonds to pay off the city's debts. The confidence in MAC bonds was restored, and under Rohatyn's chairmanship, the MAC successfully sold $10 billion in bonds. By 1977–1978, New York City had eliminated its short-term debt. By 1985, the city no longer needed the support of the Municipal Assistance Corporation, and it voted itself out of existence. In a letter to
The New York Times on March 4, 2012, Rohatyn attributed New York City's fiscal turnaround from possible bankruptcy in the late 1970s to the leadership of former New York Governor Hugh Carey and to the cooperative efforts of the city's banks and unions, though not to President
Gerald Ford's belated agreement to federally guarantee the newly issued city bonds.
After the New York City fiscal crisis By the time
Bill Clinton was elected, Rohatyn had aspired to be
United States Secretary of the Treasury since the 1970s. He had supported longtime client
Ross Perot's candidacy, however, and Clinton appointed
Lloyd Bentsen instead. In 1996, the Clinton administration put forward his candidacy for the post of
Vice Chairman of the Federal Reserve, but a formal nomination was not made because of ideological opposition from Republicans. According to
The New York Times, in the 1990s, Rohatyn described
derivatives as "financial
hydrogen bombs, built on personal computers by 26-year-olds with
M.B.A.s". In 2006 Rohatyn joined
Lehman Brothers as a senior advisor to chairman
Dick Fuld. On January 27, 2010, Rohatyn announced his return to Lazard as special advisor to the chairman and chief executive officer, after a short role at
Rothschild.
Ambassador to France Rohatyn was
United States Ambassador to France from 1997 to 2000, during the second term of the
Clinton Administration and was a Commander in the French
Legion of Honour. He was a member of the
Council on Foreign Relations,
American Academy of Arts and Sciences, and a trustee for the
Center for Strategic and International Studies. He also delivered a speech to
D-Day veterans at
Omaha Beach in 1999, on the 55th anniversary of the
Liberation of Normandy. He told them that a "democratic, prosperous Europe is the finest monument" to the veterans' exploits. He said, "I ask the children here today to look around — you are in the company of real heroes". As ambassador, he also organized the French-American Business Council, a 40-member council of U.S. and French
corporate chief executives which met annually, with meetings held alternately in the United States and France. The council meetings included President Clinton,
President Chirac and
Prime Minister Jospin, as well as U.S. cabinet secretaries and French government ministers and meetings continued during the presidencies of
George W. Bush and
Nicolas Sarkozy. While ambassador, Rohatyn also worked with the
United States Conference of Mayors to establish the TransAtlantic Conference of Mayors that gathered U.S. and European
mayors to discuss urban and economic issues and build ties among their cities. In addition, Mrs. Elizabeth Rohatyn founded the French Regional and American Museum Exchange (FRAME), a consortium of 26 French and North American
art museums that works together to sponsor major, bilateral exhibitions and education programs. After the Rohatyns left the ambassador's post in Paris, FRAME became an independent,
non-profit organization, which Mrs. Rohatyn continued to co-chair. FRAME remains vibrant and active in 2020. == Infrastructure ==