George D. Gould, a Wall Street financier who was a figure of calm in New York’s convulsive mid-1970s fiscal crisis and an original member of the state agency created to borrow on behalf of a nearly-bankrupt New York City, died on April 26 at his home in Palm Beach, Fla. He was 94.
His death was confirmed by his stepdaughter, Julie Frist.
Mr. Gould was at home one day in 1975 when Mayor Abraham D. Beame of New York called him after midnight to invite him to breakfast that morning. There, Mr. Gould was recruited to join the board of the Municipal Assistance Corporation, which New Yorkers were rushing to create to raise money and put off bankruptcy.
Big MAC, as it became known, was established after banks and other financial institutions refused to buy more municipal bonds and short-term notes because, they said, the market was saturated and the city’s ability to repay its debt had become too precarious.
For decades, though, these institutions had reaped hefty fees from the city and become complicit in what constituted its fiscal gimmickry leading up to the crisis.
Mr. Gould served as a member of the corporation for four years beginning in 1975. He became its chairman in January 1979, when Felix G. Rohatyn resigned to return to Lazard Freres & Co., the investment bank and advisory firm.
But Mr. Gould quit as chairman – a part-time, unpaid post – the following June, in part because he was irritated that Gov. Hugh L. Carey, who had appointed him, was still relying primarily on Mr. Rohatyn for advice on New York’s financial recovery. Mr. Carey asked Mr. Rohatyn to return as chairman after Mr. Gould resigned.
“As a board member,” said Eugene J. Keilin, a former MAC executive director and chairman, in an email, “George was, even then, a kind of senior stateman, knowledgeable about the bond markets and a Republican, when we needed credibility with Rockefeller Republicans, who were not yet extinct at that point. ”
Bipartisan support was needed in the State Legislature and Congress to win federal loan guarantees and other assistance to tide the city over during its crisis.
Stephen Berger, who was the executive director of the Emergency Financial Control Board during the city’s fiscal crisis, characterized Mr. Gould in an email as having been “a steadying force, balanced, smart and calm.”
At a time when several New York State agencies were under fiscal pressure, Mr. Gould also served, at various times, as chairman of the state’s Housing Finance Agency, the Medical Care Facilities Finance Agency, the Mortgage Agency, the Project Finance Agency and the State Dormitory Authority.
In 1985, he was named under Secretary of the Treasury for domestic finance by Treasury Secretary James A. Baker III, a position Mr. Gould held through 1988 overseeing domestic banking regulation. He received the Alexander Hamilton Award, the Treasury Department’s highest honor.
When he was named MAC chairman, he reflected on the difference between carping about government’s flaws from the outside and coping with how to fix them from the inside.
“It has made me realize how many erroneous, snap opinions I held and how unsimple the solutions are,” Mr. Gould told The New York Times in 1979. “It. isn’t quite as easy as it looked when I was having a drink with a few friends and said, ‘Gee, they really ought to get with it.’ “
Surveying the fiscal crisis and his role in it, he added: “The magnitude of the problem was greater than we thought, but so was the magnitude of the resources. What we found were people acting very responsibly because of enlightened self-interest. ”
After working at the Treasury Department, Mr. Gould served as chairman of the Finance and Governance Committee of the Federal Home Loan Mortgage Corporation, a publicly-traded government-sponsored enterprise known as Freddie Mac.
George Sumner Bradford Dana Gould was born on May 22, 1927, in Boston. He was named Sumner for Charles Sumner, the abolitionist United States Senator from Massachusetts, who was his mother’s great-uncle. Bradford represented his ancestral link to a family that traced its roots in New England to 1635.
His father, Ernest Wellington Gould, was a private investor. His mother, Lillian Dana (Sumner) Gould, died when he was 5, and he was raised primarily by an aunt.
After graduating from Phillips Academy in Andover, Mass., He served in the Army from 1945 to 1947 and was discharged as a second lieutenant. He earned a bachelor’s degree in economics from Yale in 1951 and a master’s in business administration from Harvard Business School in 1955.
He spent his entire business career on Wall Street, serving as board chairman of Donaldson, Lufkin & Jenrette Securities Corporation from 1961 to 1976. In 1977, he became chairman of the Madison Fund, an investment company, and later a general partner in Wertheim & Company.
In addition to his stepdaughter, his is survived by his wife, Darcy Mead Gould; his son, George Gould, from his marriage to Julie (Echols) Gould, who died in 1983; his stepsons, William Bancroft, Montgomery Bancroft and Michael T. Damgard; two grandchildren; and nine step-grandchildren.