TIME: Almanac 1993/TIME Almanac 1993.iso/time/021990/0219207.000

Text File | 1992-08-28 | 7.0 KB | 139 lines

                                                                                BUSINESS, Page 71

Bashing Greed for Fun and Profit


The Roaring Eighties take their lumps in a flurry of new books

By JOHN GREENWALD


    Doesn't anyone have a kind word for Wall Street's gilded
'80s? The new decade is only six weeks old, and already stores
are piled high with books that portray the past ten years as
a sink of avarice and excess. The melodramatic titles depict
the American free-enterprise system as overrun by barbarians
and liars, ambition and greed. And readers are lapping it all
up. Just as they reveled in stories of the rich and famous
during the past decade, today's inquiring minds are hungry for
colorful tales about the pratfalls of the mighty.

    Quite a few of these jeremiads are headed for the screen.
Producer Ray Stark (Steel Magnolias, Annie) last week acquired
film rights to Barbarians at the Gate, a best-selling account
of the $25 billion takeover of RJR Nabisco, the largest buyout
ever. Warner Bros. has paid a sum estimated to be in the high
six figures for the privilege of filming Liar's Poker, an
I-lived-with-savages expose of the Wall Street firm Salomon
Brothers. And the cameras are ready to roll on the movie
version of Tom Wolfe's blockbuster novel, The Bonfire of the
Vanities, which stars Tom Hanks in the role of bond trader
Sherman McCoy, the contemptible Master of the Universe.

    From Hollywood to local bookstores, Wall Street bashing is
big business. In Barbarians at the Gate (Harper & Row; 528
pages; $22.95), authors Bryan Burrough of the Wall Street
Journal and former Journal reporter John Helyar depict the RJR
Nabisco fight as a mud-wrestling match in which all the
participants come out grimy. Ross Johnson, the RJR Nabisco
chief executive who launched the bidding for his own company
and stood to make more than $100 million if he prevailed, is
described as "a man who devoted his life to shaking things up"
and an executive "loyal to little but his own whims." Johnson's
nemesis, buyout expert Henry Kravis of Kohlberg Kravis Roberts,
was so obsessed with conquering RJR Nabisco that he entered the
battle knowing little of substance about the giant
food-and-tobacco company.

    The book contends that KKR won, reaping $75 million in fees
alone, partly because its opponents were bumbling latecomers
to the world of leveraged buy-outs. Johnson's Wall Street
advisers, who included the giant firms Shearson Lehman Hutton
and Salomon Brothers, sometimes carried on like the Keystone
Kops. At one point, lawyers carrying a Johnson offer became
stuck in Manhattan traffic moments before the bid was due. In
desperation, they leaped from their cab and raced the remaining
two blocks on foot, arriving breathless and embarrassingly
late. Said a disgusted RJR director: "This is the gang that
couldn't shoot straight."

    Obviously rushed into print, Barbarians is rich in detail
and anecdote but poor in analysis, often reading like 100 Wall
Street Journal articles pasted end to end. After a forced march
through the history of the RJR fight, the narrative ends on a
question that should have been raised -- and wrestled with --
from the start: "What did all this have to do with doing
business?"

    While Burrough and Helyar are encyclopedic, journalist Hope
Lampert provides a more selective guide to the battles and
generals of the RJR war. In True Greed (New American Library;
259 pages; $18.95) Lampert diagnoses the imperious Johnson as
suffering from a "corporate royalty complex." Both Kravis and
former Shearson chairman Peter Cohen, who despised each other,
wanted to go down in history as the mastermind of the biggest
deal of all. But after his victory, Lampert writes, Kravis
reneged on his pledge to hold the company together and began
to dismantle RJR Nabisco, indicating that the takeover fight
was largely a battle to decide who would have the privilege of
taking the company apart.

    Liar's Poker by Michael Lewis (Norton; 249 pages; $19.95)
is a mainstream hit that is likely to broaden the market for
business books. A best seller for 14 weeks, the memoir of
Lewis' two-year career as a Salomon Brothers bond salesman has
become a must read among Wall Streeters. For everyone else, it
provides a satisfying opportunity to gloat about the venality
of Wall Street's high rollers. By depicting securities dealers
as foul-mouthed telephone hurlers with open contempt for their
customers, Lewis, 29, turned his former employer into a
laughingstock. The last laugh, of course, belonged to the
author: after earning $225,000 in his second year at Salomon,
Lewis decided that money isn't everything and resigned from the
firm -- and now is raking in even bigger bucks.

    But few others in the '80s disavowed their money lust. In
Circus of Ambition (Warner Books; 240 pages; $19.95), New York
magazine contributor John Taylor shows that Wall Street had no
monopoly on avarice. "The notion that money is good," he
declares, was a "central tenet" of the age. Tracing the
celebration of riches to Ronald Reagan's enthusiastic support
for capitalism at its most freewheeling, Taylor presents a
rogues' gallery of potent moneymakers. Among them are Mark
Kostabi, a New York artist who hired assistants to create his
pictures, paying about $100 for works that sold for $12,000
or more, and -- like a punk rocker who spits on the audience
-- warned his customers, "You're a total idiot if you buy one
of my paintings." No less smug were Hollywood producers Don
Simpson and Jerry Bruckheimer (Flashdance, Top Gun, Beverly
Hills Cop), whose slick blockbuster films glorified triumph.
"We aren't interested in losers," Simpson told the author.
"They're boring -- to us."

    For novelist Michael Thomas, the big losers of the 1980s
included old-line Wall Street firms, whose values of honor and
loyalty were eclipsed during the decade. In Hanover Place
(Warner Books; 479  pages; $19.95), Thomas chronicles the
transformation of a venerable investment house called
Warrington & Co. into the epicenter of '80s-style takeover
fever. The founding Warrington family "reflected a certain
standard of behavior," Thomas writes, but by 1989 "Wall Street
seemed sealed off in a capsule of self-regard." As part of the
plot, Thomas describes the rise of a group of Jewish financiers
whose depiction as stereotypical villains has prompted
reviewers like Judith Martin, who is better known as the
etiquette columnist "Miss Manners," to condemn the book as
anti-Semitic.

    Taken together, all five books convey a deep distrust of the
decade just past. The poet Robert Lowell once wrote in an ode
to a friend, "Yet really we had the same life, the generic one/
our generation offered." In much the same way, these tales of
the 1980s tend to merge into one generic portrait of vanity,
ego and greed. Historians may come to see the '80s in a kinder
and more diverse light, but the image of the decade in these
books is unquestionably the prevailing one today.