Eliot Spitzer: Wall Street&#39;s fallen angel

The downfall of ex-New York governor Eliot Spitzer in 2008 was spectacular. But while the "Luv Guv" became a laughing stock, have we lost the one man with the experience and tenacity to take on the financial giants?

Eliot Spitzer still looks like a man who has everything. He wears a sharp suit and munches hungrily on coffee and croissants in a plush Fifth Avenue office just a few blocks from Manhattan's Central Park. And why not? Here is a 51-year-old man with huge wealth and a loving family. He is worth millions through his work for his father's real-estate empire yet also co-hosts a high-profile chat show on CNN, where he dissects the day's news. No wonder Spitzer appears happy as he chats about morning jogs, dinners at the Four Seasons and weekends away upstate.

But looks can be deceiving. For Americans don't judge Eliot Spitzer by what he now has, but by what he once was and ? most importantly of all ? what he might have been. Spitzer is the archetypal fallen angel: a once great hope of American liberalism laid low by the tawdriest of sex scandals.

Long before there was Barack Obama there was Spitzer. While Obama toiled unknown in Illinois, the Bronx-born Spitzer won himself a national reputation as the "Sheriff of Wall Street". He was New York's tough-talking attorney-general, who fought banking corruption, enforced environment law and won rights for low-paid workers. He used that fame to enter politics and in 2006 became governor of New York: a perfect springboard for the White House. Before America fell in love with its first black president, people wondered if it was willing to embrace its first Jewish one. Spitzer could have made history.

Instead he left office in disgrace three years ago amid a flood of tabloid headlines that recounted salacious details from his repeated use of a high-end escort service. Spitzer was dubbed the "Luv Guv" and forced into a political wilderness. Rarely in American politics was a fall from grace so spectacular, so complete and so clearly down to a self-inflicted human flaw. Spitzer's current position has to be measured against that sordid history.

Except that might not be the complete picture. A compelling new documentary re-examines exactly what happened to Spitzer. Filmed by Oscar-winning director Alex Gibney, who shot Enron: The Smartest Guys in the Room and is now making a film about Julian Assange, the movie puts the Spitzer saga under a microscopic glare. But the picture that emerges is not the same one that was reported so gleefully by the press with its tales of $4,300-a-night assignations, sex with socks on and the painful evisceration of a carefully constructed public image. Instead, it weaves the story of Spitzer's personal failings into a much greater and more important narrative, one ignored by much of the media at the time.

Gibney's Client 9 ? named after the moniker given to Spitzer in the police investigation of the Emperors Club VIP prostitution ring ? investigates the powerful financial, business and political interests who benefitted from his fall. It exposes the plotting and subterfuge behind the scenes by those that Spitzer had targeted: the big banks and insurance companies engaged in fraud, the corrupt Republicans, the dubious political dirty-tricks operatives.

It is a remarkable work. By the time Client 9 ends, one looks back with marvel, as if seeing everything afresh. Spitzer's story once seemed the oldest in the book: a powerful man brought down by sex. Client 9 shows it might actually be the second-oldest story: a man brought down by the vested financial interests he attacked. That development is not to be taken lightly. Spitzer ? who devoted his life to fighting Wall Street corruption ? resigned in March 2008. When news broke, the traders on the New York Stock Exchange cheered and opened bottles of champagne. A few months later, as the bubble Wall Street created finally popped, the entire US financial system was brought to the edge of extinction. But Spitzer, who was superbly qualified to deal with that crisis, was no longer in office. Far from being just another political sex scandal, Spitzer's fall had an impact on us all.

Spitzer no longer acts like a man once known as "the Steamroller". He laughs easily and seems relaxed, only turning grave when answering questions directly about the sex scandal. He is on far happier ground discussing his talk show or his once-a-week teaching gig at the City College of New York. "The thing I get the most joy from, other than the family stuff, is teaching," he tells me. "Whenever pessimism creeps in by Friday morning ? when you say: 'My goodness, what else can go wrong?' ? you spend a few hours in the classroom and you see the creative energy and you say: 'You know what? We'll be all right.'"

But his current calm professorial persona belies his past. As a rising young lawyer he attacked organised crime, launching the investigation that broke the notorious Gambino family's dominance of Manhattan's garment and trucking industries. When he became attorney general in New York in 1998, Spitzer was a brutally aggressive crusader. He crafted the post into a vehicle for his own ambition and his pet causes of attacking corrupt vested interests, especially on Wall Street. And he viciously attacked the biggest names in investing, such as Merrill Lynch, insurance giant AIG and even the board of the New York Stock Exchange itself. He made powerful enemies, including AIG's former chief executive Hank Greenberg and Ken Langone, ex-director of the NYSE.

This is where Client 9 diverges from the conventional narrative. It eschews delving into Spitzer's dalliances ? which, after all, are not in doubt ? and instead looks at the bizarre way in which the story broke. It speculates on how the federal authorities were tipped off to Spitzer's use of the Emperors Club and why so much attention was paid to "Client 9" rather than, say, Clients 1 to 8. It also wonders how Spitzer's name was leaked to the press so quickly and why the legal affidavit contained so much identifiable detail about Client 9 when it is standard practice not to prosecute clients in prostitution rings. "The more I got into it, the more certain I became that something was odd," says Gibney. "There is no need for a lot of that information in that document to prosecute Emperors Club. Instead it is all about Spitzer."

Gibney examines a web of links between Langone and Greenberg, a shadowy Republican political consultant called Roger Stone and Spitzer's Republican nemesis in New York state politics, State Senator Joseph Bruno. A bizarre picture emerges of a powerful set of interests which had every reason to bring Spitzer down and which were searching for the chance to do so. Spitzer's mistake was to give them that chance. There is a clear implication ? though not proven ? that someone may have hired private investigators to trail Spitzer.

Some of the characters in Client 9 are almost unbelievable. Stone ? a self-confessed sex-party swinger himself ? has a tattoo of Richard Nixon on his back. Langone on film does not shy away from basking in Spitzer's fall, as if by slaying the scourge of Wall Street just months before the financial crisis somehow makes him the good guy. "Langone was dancing on Spitzer's grave. Same thing with Greenberg," Gibney says. It is compelling viewing and, with millions of Americans poorer, it changes one's idea of who the villain in Client 9 really is.

Spitzer admits that many people were out to get him. Yet he is remarkably sanguine about the idea that his big business and Republican enemies helped take him down. "There is no question they wanted to do what they could to bring me down? If you read Don Quixote, it does not turn out so well for people who tilt at power structures all the time," he says. But he adds that he is not angry at his fate. Or, at least, not any more. "You can't play with anger all the time. It would drive you nuts." Indeed Spitzer is adamant that the person to blame for his downfall remains himself. "I point the finger only at myself for having given them the ammunition to do it. That is why I have never said anything other than a very clear statement. I am responsible for what I did. What they did is insignificant to me now."

That may be true. But what about the rest of us? The revelations about Spitzer's infidelities no doubt devastated his wife, society fixture Silda Wall Spitzer. One of the enduring images of the scandal was an ashen-faced Silda standing by her husband in front of the cameras. But on a wider scale, Spitzer, who would have been uniquely valuable in the face of the worst fiscal crisis since the Depression, watched it unfold from the political wilderness. The man who had voiced more warnings about problems on Wall Street than virtually any other public figure was turned into a discredited punchline to a political joke just as those warnings came true. "It was terrible," he says. "Terrible to see the crisis happen, and even worse to see an inadequate response."

OF course, no matter how much Republicans and financiers plotted to have Spitzer taken out, no one forced him to develop a taste for high-end prostitutes. He fell into a world of illicit sex all by himself. Beginning in 2006, apparently after having stumbled upon it online, Spitzer became a regular client of the Emperors Club. He paid thousands of dollars for meetings with prostitutes and became a regular of one woman dubbed Angelina. Under the guise of the false name "George Fox", Spitzer arranged dates for her to meet him in Washington, Florida and even Puerto Rico.

Spitzer's fall came when federal investigators busted the Emperors Club and, as soon as Spitzer's name was leaked, the media had a field day. They focused on "Kristen", who had met with Spitzer at the Mayflower Hotel in Washington and unquestioningly assumed she was Spitzer's regular girl (she was not). She was quickly revealed as Ashley Dupre, a prostitute and aspiring singer. Dupre proved a dab hand at the publicity game and appeared on the front pages, TV shows and, inevitably, Playboy. She is now a dating columnist for the conservative tabloid the New York Post.

The coverage of the scandal became a classic media-attack frenzy. Given the brutal hauling over the coals, one might expect Spitzer ? who was never charged with any crime ? to be angry at the media. But he just shrugs it off. "There is some superb journalism at an intellectual level that is fascinating, and there is some journalism that isn't quite as erudite," he says. "That reflects human nature, I suppose. I have seen the peaks and valleys of both journalism and every other part of life. I don't kid myself."

Now Spitzer himself works as a journalist. His CNN show is co-hosted with Kathleen Parker, a Pulitzer prize winner. It got off to a shaky start, but last week started posting some decent ratings figures. Spitzer, against the odds, once again has the thing all political figures crave: a soapbox. "Participating in the public conversation on a platform like this is wonderful," he says. "It's different, needless to say. Being governor was one thing, being attorney-general was one thing and being host of a daily talk show is another. But it is all great fun."

In fact, Spitzer actually seems happy now. Back in the old days his rage at his targets was a thing of legend, among both friends and foes. But there is little sign of it now. "I think he's a man who's learned something about himself," says Gibney. When asked if he is indeed more content now than when wielding power, Spitzer hesitates and even stutters slightly. "That's a great question. It is a very existential question, which every now and then I have asked myself ? and I refuse to answer it."

He goes on to talk about a lingering sense of disappointment in a mission unfulfilled, but he refuses to be drawn on whether he missed out on the White House through his own personal failings. "There are certain things that you just carve out and close the door and then don't open it because it leads nowhere good," he says. "What's the point? It just doesn't do anything useful."

But is the door to politics permanently shut on Spitzer? His family and his marriage have remained intact. His public penance has been genuine and without reservations. Does Spitzer have a five-year plan for a great return? "Five-year plans went out of style with Stalin. That was not good marketing for five-year plans," he jokes. "If I had one, it would be that in five years my three kids will be 23, 25 and 27 and I want just to make them happy. Really, that is much more of a focus."

However, it is important to note that Spitzer did not say "no". A point he himself understands. The call of public service in some form is still there. "Who knows? I am not aged yet. I am not teetering. I am not ready to retire. It is hard to predict where these things go. On the other hand I love going upstate on weekends and watching the sunset."

It might be a shame if Spitzer does not try to return. America remains in crisis. Its politics roil with conservative revolt, its finances are a mess, basic services are being cut and Wall Street ? the architect of the disaster ? appears more powerful than ever before. The promise Obama brought to Washington has, for many on the left, been tarnished. Spitzer is one of them. He rails against the current administration. "The political consequence of the greatest economic debacle since 1929 is that the Tea Party and the Republican party have emerged resurgent and Barack Obama has embraced Wall Street," Spitzer says, pulling no punches, almost like he is back in the political arena. "That is the greatest intellectual failure of modern politics. The teachable moment we had to explain to the public what happened was completely squandered by a White House that was filled with cowards."

One senses a Spitzer White House would have been very different from the current one. But one can never know. Instead of having Spitzer wielding real power to take on the big banks, he can only attack them from the bully pulpit of CNN, not the New York governor's mansion or the Oval Office. That seems the true tragedy of Spitzer's story. The real victims of the plot against Spitzer and of his own monumental folly ended up being millions of ordinary Americans.

Client 9: The Rise and Fall of Eliot Spitzer is in cinemas from 4 March

Paul Harris is US correspondent for the Guardian and the Observer