Hat tip to my former colleague, Jim Wright, who put me on to Steven Malanga’s interesting and well-researched article in the City Journal, “Whatever Happened to the Work Ethic?” which strikes at the heart of our economic crisis. Things have changed in America where we used to work hard to make things and where borrowing and bailouts were eschewed.
As Malanga states: “What would Tocqueville or Weber think of America today? In place of thrift, they would find a nation of debtors, staggering beneath loans obtained under false pretenses. In place of a steady, patient accumulation of wealth, they would find bankers and financiers with such a short-term perspective that they never pause to consider the consequences or risks of selling securities they don’t understand. In place of a country where all a man asks of government is “not to be disturbed in his toil,” as Tocqueville put it, they would find a nation of rent-seekers demanding government subsidies to purchase homes, start new ventures, or bail out old ones. They would find what Tocqueville described as the “fatal circle” of materialism—the cycle of acquisition and gratification that drives people back to ever more frenetic acquisition and that ultimately undermines prosperous democracies.”
Malanga’s full analysis of the topic is well worth reading.
On the eve of President Obama’s inauguration I wrote “The winners in this economy were not only the capitalists, the real creators of jobs due to hard work and innovation, but the even bigger winners: the financial masters of the universe who learned to leverage financial instruments with the blessings of a government that nurtured the thievery of the public good through deregulation, ineptitude, and political amorality. This gave rise to a whole generation of pseudo capitalists, people who “cashed in” on the system, bankers and brokers and “financial engineers” who dreamt up lethal structures based on leverage and then selling those instruments to an unsuspecting public, a public that entrusted the government to be vigilant so the likes of a Bernie Madoff could not prosper for untold years. Until we revere the real innovators of capitalism, the entrepreneurs who actually create things, ideas, jobs, our financial system will continue to seize up. That is the challenge for the Obama administration – a new economic morality.”
I still await that new economic morality.
Meanwhile, since the National Debt passed $11 trillion in March, the markets have moved strongly on the upside, led by the financials, anticipating a recovery from the Great Recession. I see little difference in the general shape of our financial institutions other than the federal government (uh, we the taxpayers) standing ready to bail out any deemed to pose a systemic risk to the system. As of the end of August the National Debt now stands at $11.8 trillion, so over the next several weeks that will undoubtedly pass the $12 trillion mark. That’s $1 trillion in additional debt in only 6 months. I make this observation in advance as this blog will go silent for several weeks while are traveling overseas.
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Thursday, September 3, 2009
Thursday, August 27, 2009
“Typical American” and the Dream
Go west young man; that is, go so far west you find the opportunity for employment and pursue the promise of prosperity which is thought to be at the heart of the American Dream. For many recent graduates, that journey might now begin in China: American Graduates Finding Jobs in China: “Shanghai and Beijing are becoming new lands of opportunity for recent American college graduates who face unemployment nearing double digits at home.”
Such are the ironies of life, a reversal of immigrants flocking to American shores in pursuit of employment and a richer, happier life.
For years Gish Jen’s Typical American (Houghton Mifflin, 1991) had sat on my bookshelf waiting to be read. I first heard about the novel from a PBS program NOVEL REFLECTIONS ON THE AMERICAN DREAM, but it was the recent extended stay of my son, Jonathan, in Shanghai that led me to finally read the novel, and to better understand the Chinese, and their assimilation into American culture. Also, I did business with the China National Publications Import Export Corporation and was impressed by their selection and importation of books we published over the years so I was curious about Jen’s novel.
I expected a story about what it means to be a foreigner in a foreign land, especially the vicissitudes of being Asian in America soon after WW II, and while there are those elements, it reminded me more about the misinterpretation of the American dream, the illusion of prosperity being the definition of a meaningful life.
What does it mean to be, or become a “typical American?” The Chang family is at first derisive of their concept of the “typical American” until they begin to desert their traditional work ethic, moral groundings, and family loyalty as they become “typical Americans” themselves, enduring a tragedy to bring their values back into balance.
This is not a conventional story about immigrants, but, instead, is a very well written novel about what freedom and responsibility mean in relation to "life, liberty and the pursuit of happiness” in a land that “promises” no limits. Or as Ralph Chang discovers: “What escape was possible? It seemed to him…that a man was as doomed here as he was in China….He was not what he made up his mind to be. A man was the sum of his limits; freedom only made him see how much so. America was no America.”
And the writing is wonderful: “And then there was another pain too, quieter, weightier, its roots in what everybody knows – that one day a person looks back more than forward, that one day he’ll have achieved as much as he was going to, loved as much as he was going to, been as happy as it was granted him to be. And that day, won’t he have to wonder – was it enough, what he’s lived? Can he call that a life and be satisfied?”
And isn’t that the essence of the dream, and of any culture?
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Such are the ironies of life, a reversal of immigrants flocking to American shores in pursuit of employment and a richer, happier life.
For years Gish Jen’s Typical American (Houghton Mifflin, 1991) had sat on my bookshelf waiting to be read. I first heard about the novel from a PBS program NOVEL REFLECTIONS ON THE AMERICAN DREAM, but it was the recent extended stay of my son, Jonathan, in Shanghai that led me to finally read the novel, and to better understand the Chinese, and their assimilation into American culture. Also, I did business with the China National Publications Import Export Corporation and was impressed by their selection and importation of books we published over the years so I was curious about Jen’s novel.
I expected a story about what it means to be a foreigner in a foreign land, especially the vicissitudes of being Asian in America soon after WW II, and while there are those elements, it reminded me more about the misinterpretation of the American dream, the illusion of prosperity being the definition of a meaningful life.
What does it mean to be, or become a “typical American?” The Chang family is at first derisive of their concept of the “typical American” until they begin to desert their traditional work ethic, moral groundings, and family loyalty as they become “typical Americans” themselves, enduring a tragedy to bring their values back into balance.
This is not a conventional story about immigrants, but, instead, is a very well written novel about what freedom and responsibility mean in relation to "life, liberty and the pursuit of happiness” in a land that “promises” no limits. Or as Ralph Chang discovers: “What escape was possible? It seemed to him…that a man was as doomed here as he was in China….He was not what he made up his mind to be. A man was the sum of his limits; freedom only made him see how much so. America was no America.”
And the writing is wonderful: “And then there was another pain too, quieter, weightier, its roots in what everybody knows – that one day a person looks back more than forward, that one day he’ll have achieved as much as he was going to, loved as much as he was going to, been as happy as it was granted him to be. And that day, won’t he have to wonder – was it enough, what he’s lived? Can he call that a life and be satisfied?”
And isn’t that the essence of the dream, and of any culture?
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Saturday, August 15, 2009
A Tribute in a Most Unlikely Place
This week’s Barron’s Magazine, the Dow Jones publication that purports to be “America's premier financial weekly “, mentions, as among its must “six economics books to take to the beach,” Rabbit Angstrom; The Four Novels. (“Worth Mulling: A Late-Summer Reading List by Gene Epstein). Kudos to Barron’s to include Updike and to recognize that literature is life, encompassing economics as well. As Epstein states:
“Finally, the death in January of novelist and critic John Updike must not go unremarked. The last two novels in his tetralogy about the fictional Harry "Rabbit" Angstrom -- Rabbit Is Rich (1981) and Rabbit at Rest (1990) -- capture the world of work as few novels have. If the Toyota dealership in which Harry flourishes (in Rich) and then sees destroyed by his son Nelson's cocaine habit (in Rest) does not quite make him a conscious capitalist, it comes pretty close. The four works together, including Rabbit, Run and Rabbit Redux, are also the closest thing I know to the great American novel.”
It is hard to accept that our greatest and most prolific writer is dead. I am presently reading Updike’s short story “Personal Archaeology” from his last collection, My Father’s Tears, which begins, “In his increasing isolation – elderly golfing buddies dead or dying, his old business contacts fraying, no office to go to, his wife always off at her bridge or committees, his children as busy and preoccupied as he himself had been in middle age – Craig Martin took an interest in the traces left by prior owners of his land.” It is a perfectly crafted story about the passage of time and our place in the continuum. More on that story and the collection later.
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“Finally, the death in January of novelist and critic John Updike must not go unremarked. The last two novels in his tetralogy about the fictional Harry "Rabbit" Angstrom -- Rabbit Is Rich (1981) and Rabbit at Rest (1990) -- capture the world of work as few novels have. If the Toyota dealership in which Harry flourishes (in Rich) and then sees destroyed by his son Nelson's cocaine habit (in Rest) does not quite make him a conscious capitalist, it comes pretty close. The four works together, including Rabbit, Run and Rabbit Redux, are also the closest thing I know to the great American novel.”
It is hard to accept that our greatest and most prolific writer is dead. I am presently reading Updike’s short story “Personal Archaeology” from his last collection, My Father’s Tears, which begins, “In his increasing isolation – elderly golfing buddies dead or dying, his old business contacts fraying, no office to go to, his wife always off at her bridge or committees, his children as busy and preoccupied as he himself had been in middle age – Craig Martin took an interest in the traces left by prior owners of his land.” It is a perfectly crafted story about the passage of time and our place in the continuum. More on that story and the collection later.
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Friday, August 14, 2009
Block Island Days
Perhaps some things are better left alone. For instance, I recently visited the offices where I used to work. The building was brand new in 1979 when I leased those offices, at first the 2nd floor of the three story building, eventually occupying the entire building and the one next door as well. The last time I was in the building was about eight years ago. Since then the interior was reconfigured leaving a maze of cubicles and now the company has changed ownership. The offices are being closed and there remains just a skeletal staff in the transition phase. So, it was a bittersweet return, seeing a few people with whom I had worked, reminiscing about the “old times.” As I left the building this one last time, it was with a sense of sadness I thought I had already overcome.You can’t go home again. There are certain memories you should put away in the museum of your mind, leaving them perfectly preserved in their protective cases.
In a sense, the many days we spent boating to Block Island have become such a treasure. Perhaps that is one of the reasons when we last left the Great Salt Pond of Block Island a few years ago, I suspected we might never return. Not having gone back, that sense of not wanting to revisit what had such an impact on our lives, has been reinforced with each passing year.Those were our adult to later middle years and now, with our children grown, and with the rigors of boating becoming more challenging as we age, not to mention the explosive expense of fuel and dockage, Block Island is now just a wonderful memory.
For us the journey began in our little 28’ boat in 1984 -- ‘Spindrift’-- equipped with not much more than a compass and a VHF so our ninety mile trip from Norwalk, CT through the infamo
us “Race” with its frequent fog, turbulent water and numerous fishing boats to navigate around, into the Block Island Sound, exposed to ocean swells, and finally into the Great Salt Pond of Block Island, was an adventure. We relied on compass headings and visual sightings of certain buoys, zigzagging our way there.The first couple of years of venturing to Block we tried the docks at both Champlain’s and the Block Island Boat Basin, the advantage of the former being its salt water pool that our then 8 year old Jonathan loved, and the latter their floating docks – easier on and off the boat and no rafting (boats tied together, strangers trouncing across your boat to get to the dock).
Here I must detour in the story of our Block Island days. At this time we befriended Ray and Sue who have a son about the same age as Jonathan. Then we were at the same Marina,
Norwest Marine in Norwalk. I briefly mentioned Ray in my article on Crow Island but I failed to mention how critical he has been to the story of our boating life.Ray was my boating mentor, and there could be no better one. Ann and I have joked that if we were marooned on a desert island, he would be the one person we would want at our side. Give him a roll of duct tape, rope and a few other materials and he will build you a cathedral. In boating you can find yourself in unpredictable situations and Ray has frequently bailed us out. One time we arrived at Block taking on water because one engine’s muffler had burst and in the infinite wisdom of the boat manufacturer, this was below the water line. No problem for Ray, who immediately sized up the situation and decided to temporarily plug the exhaust with a large plastic coke bottle, a perfect, secure fit, stopping the leak until we could replace the muffler.
Continuing the story, my friend John was flying over to Block where he had left his boat with his wife Cathy and their two children, and he said, no problem, picking up a replacement muffler and between Ray and John, the repair was made, a perfect example of boating camaraderie and cooperation.
Ray showed us the path into Crow Island, long before the GPS made it a more accessible destination and it was there that our families spent countless weekends. Due in large part to his encouragement, in 1985 we bought a 37’ powerboat, and as a much younger man, I fearlessly took our new ‘Swept Away’ all over the Long Island Sound and its ports on Long Island and Connecticut sides, plus Newport, Cuttyhunk, Edgartown, and Nantucket for several summer vacations in subsequent years.
We cruised to those ports without Ray and his family as by that time he was convinced that there was only one port really worth going to, settling down for his summer vacation on their 44’ ‘Rascel’, at Block Island, and, specifically Payne’s Dock.
So, on our way back from one of our more distant ports we would stop at Payne’s to visit for a few days and, gradually, like Ray and Sue, we found ourselves spending more and more of our vacation time at Block until, we too, found ourselves going there for our entire summer vacations.
Payne’s is an enigmatic place, a community like no other we’ve visited on the water. It’s not just a dock, but an ongoing event, the same boaters showing up at about the same time, and settling into routines as mundane as hanging around waiting for the coffe
e to be made at the top of the dock, ordering a few or more of the homemade donuts we lovingly referred to as “sinkers”, sitting around the ancient wooden picnic tables sipping coffee in the frequently fogged in morning, to the evening libations at rickety Mahogany Shoals. Payne’s rafts boats during the crowded weekends but always seems to be able to match up compatible boaters. To watch Cliff Payne and his “dock geezers” move around boats, slipping them in and out of tight quarters was to watch a comical, sometimes nail biting, but effective chorography.
One weekend our older son, Chris, surprised us by biking 75 miles from Worcester, MA to the Block Island Ferry at Point Judith, RI, arriving with enough energy to join us and friends at
Ballard’s in Old Harbor for lobster and then we all danced the chicken. Chris clucked and flapped his wings, none the worse for wear after his long bike ride.After morning tasks, our families would dinghy to the eastern side of the Great Salt Pond, leaving our little boats, cross the Corn Neck Road causeway and settle in at Scotch Beach on the Atlantic Ocean for the day. Block has been called the Bermuda of the north for good reason, the water crystal clear, the waves perfect for body surfing which the kids did most of the day (OK, the adults too when we could grab their boards). Then, back to our boats, shower, and its cocktail time and pot luck dinner on someone’s boat.
We called fluke fishing at the mouth of the harbor “meat runs” as we were sure to catch that night’s dinner. Again, Ray was the leader of the pack, both in organizing those fishing parties and filleting the fish like a surgeon, squeezing every drop of edible fish leaving the waiting seagulls disappointed with the remnants tossed off the dock after surgery was completed.
Then there might be a “cook off,” the ladies preparing the fluke
different ways, or sometimes as teams. To watch my wife, Ann, and Ray’s wife, Sue, cook in the galley was exhausting, pots, pans, plates, being passed back and forth in tight quarters, those beautiful, sun baked faces, flush with a cocktail or two, we expectantly awaiting the outcome of their culinary skills. Frequently, meals were served to accommodate an entire boatload of friends, everyone balancing plates and drinks in the cockpit. These feasts continued night after night, always with high praise heaped on the amazing kitchen crew!Once we went tuna fishing off of Block. But I was the “accidental fisherman,” mainly going along
to photograph the activities. The party thought it might be a good joke on our way back, after everyone had caught a yellow fin tuna in the 80 pound range, to watch me try to reel in one, using a stand-up belt (no fighting chair on the boat). They laughed as I struggled with the reel and the belt kept falling to my knees as my waist was too small, but I had the last laugh as I finally reeled in a 200 lb blue fin tuna. I couldn’t lift my arms for hours. Most of the tuna was sold at the dock at Montauk but we filleted one for ourselves and grilled it on the dock at Payne’s that night.When not cooking up, we would pile into one of the cars that one of the family’s brought over on the ferry (this became the main means of transportation to the beach after our boys turned driving age), and went off to one of the many joints on Block Island, ending up at the
one and 
only Ice Cream shop, which brought us to the Old Harbor, where the shops were. And when not at the beach, there was always a bike ride around Block, challenging because of its steep hills.At one point we figured out ways of staying longer at Block, leaving our boats and families, taking the short flight to Westerly Airport where we would leave a car to commute back to our Connecticut offices for a few days to attend to business. On a couple of occasions we charted planes to Bridgeport Airport to attend to business, stretching out our Block Island stays.
Over 
the years we became part of the Payne’s “family.” Our son Jonathan thinks of Block as a second home and many of his friends are from the Block Island experience. At first Ray’s boat and mine were in the “pens” with easy on and off via our transoms, but later we went to the end of tees, our transoms facing each other. In our last boating days at Block we were rafted to Ray’s boat, the one they live on now, their 56’ ‘Last Dance.’While our own boating lives have changed considerably these last few years, Block Island remains the prized destination in our boating memory.
Thursday, August 6, 2009
Clunker Consequences
The cash for clunker’s program has been proclaimed a “success” by politicians lining up to take credit, to show their constituents that they know how to sprinkle a little money on the little guy, a mere $3 billion when it is all said and done, while $trillions go to Wall Street in one form or another. But, as with many of these bailout programs, when the government steps in, there are unintended consequences, some of which can’t be seen until the deed is done. Clunkers Plan Deflates Mechanics proclaims the Wall Street Journal. While car dealers are delighting in their windfall, 164,000 auto repair shops, as well as their suppliers, are left with less work. As one spokesperson pointedly said: "How do we get on the special interests, special treatment bandwagon? How much is it going to cost me and to whom shall I send the check? Who picks the winners in this game 'cause obviously the game is fixed."
And that in a microcosm is the downside of this approach to “fixing” the economy. Cash for clunkers might save some jobs, but at the expense of others. Also, the government has succeeded in doing what public corporations have long done – accelerating sales to make one quarter look better than it would otherwise. Wouldn’t these clunkers have to be ultimately replaced anyhow? Merely moving these sales forward does not fix the economy or create permanent jobs and as many automotive repair shops are independents, it certainly hurts small business. But it may make some politicians look good for a little while.
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And that in a microcosm is the downside of this approach to “fixing” the economy. Cash for clunkers might save some jobs, but at the expense of others. Also, the government has succeeded in doing what public corporations have long done – accelerating sales to make one quarter look better than it would otherwise. Wouldn’t these clunkers have to be ultimately replaced anyhow? Merely moving these sales forward does not fix the economy or create permanent jobs and as many automotive repair shops are independents, it certainly hurts small business. But it may make some politicians look good for a little while.
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Monday, August 3, 2009
Headline Tedium
Bailouts, bonuses and Madoff. Are we getting tired yet of the endless litany of related headlines such as the Wall Street Journal’s recent “Bank Bonus Tab: $33 Billion; Nine Lenders That Got U.S. Aid Paid at Least $1 Million Each to 5,000 Employees”?
The rock star of these “fab” financial “leaders” is Andrew Hall who makes a bundle for himself trading energy contracts for Citigroup's energy-trading unit Phibro LLC, with compensation approaching $100 million for 2008. It is interesting to read Sunday’s New York Time’s front page article on his activities and compensation. No doubt he is a talented individual and I suppose if Citigroup didn’t want his operation’s expertise in “taking advantage of unusual spreads between the spot price of oil and the price of an oil futures contract,” other firms would be lining up to pay his price. That is the American way. We know how to lavish money on our superstars, whether from the media or sports, or in this case, dice-rolling trading moguls.
The Times refers to his compensation as “his cut of profits from a characteristically aggressive year of bets in the oil market.” It also says “the company, for example, often wagers that the price of oil will rise so fast during a particular period, say six months, that it can make money by storing oil in supertankers and floating it until the price goes up. “ Finally, “right before the first Gulf War, Phibro placed an elaborate bet that the price of oil would spike and then go down faster than others were anticipating. The company earned more than $300 million from the gamble.” I emphasize bets, wagers, and gamble, as these words cut to the heart of the matter. Arbitrage and hedging can be a means of controlling risk or it can magnify risk to the point of endangering the entire financial system. Is this what our banks should be doing: betting, gambling and waging? Heads they win, tails the taxpayer loses? I have to wonder what the consequences would have been if Mr. Hall’s trades had gone disastrously against Citigroup. Would he have been personally at risk for the same $100 million he “earned” being on the right side? Do we want our banks, the bedrock of our financial system engaging in such activities – aren’t these the domain of the individual entrepreneur and private capital? To what extent does such “trading” create spikes such as $147 for a barrel of crude oil while there is a glut of the commodity?
Then there is the continuing rhetoric about having to reward the financial superstars that got us into this mess in the first place, or they will “walk.” I like Warren Buffet’s homey comments on this topic so I quote from his 2006 letter to his Berkshire Hathaway shareholders. Although this is aimed at CEO pay in general, which is also absurdly high in many (but not all) corporations, it applies to our banks and other financial service firms as well:
“CEO perks at one company are quickly copied elsewhere. ‘All the other kids have one’ may seem a thought too juvenile to use as a rationale in the boardroom. But consultants employ precisely this argument, phrased more elegantly of course, when they make recommendations to comp committees. Irrational and excessive comp practices will not be materially changed by disclosure or by ‘independent’ comp committee members….Compensation reform will only occur if the largest institutional shareholders – it would only take a few – demand a fresh look at the whole system. The consultants’ present drill of deftly selecting ‘peer’ companies to compare with their clients will only perpetuate present excesses.”
Another mind-boggling headline “Picowers Rebut Suit Tied to Madoff Fraud” is from Saturday’s Wall Street Journal. and The New York Times version of the same “Big Investor Counters Charges in Madoff Case.” According to the Madoff bankruptcy trustee, Irving Picard, Picower’s accounts posted gains of more than 100 percent a dozen times between 1996 and 2007, with one gaining 950 percent, but this counter suit contends the latter was “only” 37.6 percent and none of his accounts earned more than 100 percent “in any single year.” But the $5.1 billion Picower withdrew over the years may have represented a return greatly exceeding any reasonable return during the same period. How a knowledgeable investor (presumably Picower qualifies) could believe that Madoff can “guarantee” steady returns of 10 to 12 percent a year and be satisfied by the statements received from Madoff to bear out those returns is beyond me. I still think the “idea” of creating a new reality TV show, something we seem to be better at than regulating financial Ponzi schemes (either private or government sponsored) might be just the ticket to fund the innocent victims of Madoff.
On the eve of President Obama’s inauguration, I had written the following: “The winners in this economy were not only the capitalists, the real creators of jobs due to hard work and innovation, but the even bigger winners: the financial masters of the universe who learned to leverage financial instruments with the blessings of a government that nurtured the thievery of the public good through deregulation, ineptitude, and political amorality. This gave rise to a whole generation of pseudo capitalists, people who “cashed in” on the system, bankers and brokers and “financial engineers” who dreamt up lethal structures based on leverage and then selling those instruments to an unsuspecting public, a public that entrusted the government to be vigilant so the likes of a Bernie Madoff could not prosper for untold years. Until we revere the real innovators of capitalism, the entrepreneurs who actually create things, ideas, jobs, and our financial system will continue to seize up. That is the challenge for the Obama administration – a new economic morality.”
I haven’t changed my view and I fear that while we bail out banks, insurance companies and their like, leaving present compensation practices in place, we just continue to perpetuate financial risk taking, swinging for the fences, making “bets and wagers” that will just dig us into a deeper future hole. As the headlines attest, the “challenge” remains. A true recovery requires jobs, jobs, jobs – and how are they going to be created – by banks trading energy futures? What happened to the commitment to the infrastructure? Our roads, utilities, and public transportation are falling apart. Alternative energy seems DOA. Aren’t these the areas our financial recourses should be focused on, ones that will create jobs, in construction, technology, and finance, and can lead a true economic recovery we can pass on with pride to future generations?
The rock star of these “fab” financial “leaders” is Andrew Hall who makes a bundle for himself trading energy contracts for Citigroup's energy-trading unit Phibro LLC, with compensation approaching $100 million for 2008. It is interesting to read Sunday’s New York Time’s front page article on his activities and compensation. No doubt he is a talented individual and I suppose if Citigroup didn’t want his operation’s expertise in “taking advantage of unusual spreads between the spot price of oil and the price of an oil futures contract,” other firms would be lining up to pay his price. That is the American way. We know how to lavish money on our superstars, whether from the media or sports, or in this case, dice-rolling trading moguls.
The Times refers to his compensation as “his cut of profits from a characteristically aggressive year of bets in the oil market.” It also says “the company, for example, often wagers that the price of oil will rise so fast during a particular period, say six months, that it can make money by storing oil in supertankers and floating it until the price goes up. “ Finally, “right before the first Gulf War, Phibro placed an elaborate bet that the price of oil would spike and then go down faster than others were anticipating. The company earned more than $300 million from the gamble.” I emphasize bets, wagers, and gamble, as these words cut to the heart of the matter. Arbitrage and hedging can be a means of controlling risk or it can magnify risk to the point of endangering the entire financial system. Is this what our banks should be doing: betting, gambling and waging? Heads they win, tails the taxpayer loses? I have to wonder what the consequences would have been if Mr. Hall’s trades had gone disastrously against Citigroup. Would he have been personally at risk for the same $100 million he “earned” being on the right side? Do we want our banks, the bedrock of our financial system engaging in such activities – aren’t these the domain of the individual entrepreneur and private capital? To what extent does such “trading” create spikes such as $147 for a barrel of crude oil while there is a glut of the commodity?
Then there is the continuing rhetoric about having to reward the financial superstars that got us into this mess in the first place, or they will “walk.” I like Warren Buffet’s homey comments on this topic so I quote from his 2006 letter to his Berkshire Hathaway shareholders. Although this is aimed at CEO pay in general, which is also absurdly high in many (but not all) corporations, it applies to our banks and other financial service firms as well:
“CEO perks at one company are quickly copied elsewhere. ‘All the other kids have one’ may seem a thought too juvenile to use as a rationale in the boardroom. But consultants employ precisely this argument, phrased more elegantly of course, when they make recommendations to comp committees. Irrational and excessive comp practices will not be materially changed by disclosure or by ‘independent’ comp committee members….Compensation reform will only occur if the largest institutional shareholders – it would only take a few – demand a fresh look at the whole system. The consultants’ present drill of deftly selecting ‘peer’ companies to compare with their clients will only perpetuate present excesses.”
Another mind-boggling headline “Picowers Rebut Suit Tied to Madoff Fraud” is from Saturday’s Wall Street Journal. and The New York Times version of the same “Big Investor Counters Charges in Madoff Case.” According to the Madoff bankruptcy trustee, Irving Picard, Picower’s accounts posted gains of more than 100 percent a dozen times between 1996 and 2007, with one gaining 950 percent, but this counter suit contends the latter was “only” 37.6 percent and none of his accounts earned more than 100 percent “in any single year.” But the $5.1 billion Picower withdrew over the years may have represented a return greatly exceeding any reasonable return during the same period. How a knowledgeable investor (presumably Picower qualifies) could believe that Madoff can “guarantee” steady returns of 10 to 12 percent a year and be satisfied by the statements received from Madoff to bear out those returns is beyond me. I still think the “idea” of creating a new reality TV show, something we seem to be better at than regulating financial Ponzi schemes (either private or government sponsored) might be just the ticket to fund the innocent victims of Madoff.
On the eve of President Obama’s inauguration, I had written the following: “The winners in this economy were not only the capitalists, the real creators of jobs due to hard work and innovation, but the even bigger winners: the financial masters of the universe who learned to leverage financial instruments with the blessings of a government that nurtured the thievery of the public good through deregulation, ineptitude, and political amorality. This gave rise to a whole generation of pseudo capitalists, people who “cashed in” on the system, bankers and brokers and “financial engineers” who dreamt up lethal structures based on leverage and then selling those instruments to an unsuspecting public, a public that entrusted the government to be vigilant so the likes of a Bernie Madoff could not prosper for untold years. Until we revere the real innovators of capitalism, the entrepreneurs who actually create things, ideas, jobs, and our financial system will continue to seize up. That is the challenge for the Obama administration – a new economic morality.”
I haven’t changed my view and I fear that while we bail out banks, insurance companies and their like, leaving present compensation practices in place, we just continue to perpetuate financial risk taking, swinging for the fences, making “bets and wagers” that will just dig us into a deeper future hole. As the headlines attest, the “challenge” remains. A true recovery requires jobs, jobs, jobs – and how are they going to be created – by banks trading energy futures? What happened to the commitment to the infrastructure? Our roads, utilities, and public transportation are falling apart. Alternative energy seems DOA. Aren’t these the areas our financial recourses should be focused on, ones that will create jobs, in construction, technology, and finance, and can lead a true economic recovery we can pass on with pride to future generations?
Sunday, July 26, 2009
Richard Yates’ Revolutionary Road
A while ago I was “tagged” by a fellow blogger to name twenty-five writers who “influenced” my life, and although I began my reply by naming Updike, Roth and Dreiser, Richard Yates could have easily been the first on my list.
He is certainly the only writer where I may have had some small reciprocal impact. Why? Because for almost ten years the only edition of his classic Revolutionary Road in print was the one I republished in 1971. Astonished to find it out of print at the time, we snapped up the rights from Yates’ literary agent, the International Famous Agency. In fact, the Wikipedia entry for the novel incorrectly cites Greenwood Press as the publisher instead of its original publisher, Little, Brown, and Company (1961). No doubt the article’s author was holding the Greenwood hardcover edition.
When our edition was published it was my intention to reread it, but career demands, other literary works, including all of Yates’ later novels and short stories, encroached on my reading time, so on various bookshelves in the homes we’ve lived, this edition nestled in waiting. The catalyst for recently rereading Revolutionary Road was the film of it, starring Leonardo DiCaprio and Kate Winslet. Reportedly, the book was “discovered” as a major American literary work by Kate Winslet and
her husband, the film’s director, Sam Mendes. The film seemed faithful to the novel so I finally read the reprint edition to see for myself. In the process I was reminded why I was so taken with Yates’ work in the first place.
Since I am an “old” production guy, I have to describe the edition, republished without a jacket but in a library binding, 88 point binder’s boards, Arrestox "C" weight cloth with gold foil stamping on the spine, 5–1 /2 x 8–1/2 trim size, headbands and footbands, printed on acid free, cream colored high-opacity 50 lb paper. It was probably printed in Ann Arbor, Michigan where we printed the majority of our books. It looked as new as the day it was republished. So, I have come full circle with the book, reading it soon after it was first published, reprinting it when it went out of print, seeing the movie, and now finally rereading my reprint edition of the novel, with more than 40 years intervening.
As I said I thought the movie closely followed the book but after rereading Revolutionary Road, I am struck by its extreme faithfulness. Maybe this is because Yates’ elegantly developed plot moves chronologically and with an inevitability that drives the novel to its conclusion, making it so adaptable to the screen. But mostly, it is Yates’ living dialogue and although I do not have the screenplay to compare, I am certain much of it was wisely lifted from the novel itself.
When I first read the novel I was going through a divorce, having been married at the end of my junior year in college. My ex-wife and I were two kids, not unlike Frank and April in Revolutionary Road. I take literature very personally and the novel spoke directly to me as my own marriage was disintegrating and I was looking for answers.
The relationship of Yates’ men and women can be summed up by the titles of Yates’ two terrific short story collections: Eleven Kinds of Loneliness and Liars in Love. I was struck by these two themes, loneliness and self deception, as depicted in Revolutionary Road, relating those to my own experience, not only in my first marriage but the failed marriage of my parents (although they continued the pretense of a marriage to their deaths). Yates’ characters are perpetually struggling with one another, the men unsure of their masculinity, having to prove it in their work, their “need” to be loved by their wives, and to dominate women outside their marriages, while the women are highly neurotic and dependent but oddly headstrong and impulsive at the same time.
Towards the novel’s dénouement, April, exhausted from her struggles with her husband Frank, determined to follow through on aborting their third child, sends Frank off to work with a little kiss. Frank is confused, astounded, but grateful as he goes off to catch his train. April thinks it was “…a perfectly fair, friendly kiss, a kiss for a boy you’d just met at a party. The only real mistake, the only wrong and dishonest thing, was ever to have seen him as anything more than that. Oh, for a month or two, just for fun, it might be all right to play a game like that with a boy; but all these years! And all because, in a sentimentally lonely time long ago, she had found it easy and agreeable to believe whatever this one particular boy felt like saying, and to repay him for that pleasure by telling easy, agreeable lies of her own, until each was saying what the other most wanted to hear – until he was saying ‘I love you’ and she was saying ‘really, I mean it; you’re the most interesting person I’ve ever met.’” Indeed, liars in love. It perfectly described my own experience and I’ve been hooked on Yates ever since.
Yates characters wear different personas, playacting their way through their lives, with a natural capacity for self deception and disingenuousness. The book begins with a play in which April acts in a community theatre production. For a month after April finds she is pregnant with this third child, she and Frank go through their own elaborate play, she wanting an abortion (supposedly for Frank’s sake) and Frank wanting the child (supposedly for moral reasons). Subliminally he realizes that the pregnancy will put to rest April’s impetuous desire to move to Paris and thus leave them with a “comfortable” suburban life: “And so the way was clear for the quiet, controlled, dead serious debate with which they began to fill one after another of the calendar’s days, a debate that kept them both in a finely drawn state of nerves that was not at all unpleasant. It was very like a courtship….His main tactical problem, in this initial phase of the campaign, was to find ways of making his position attractive, as well as commendable. The visits to town and country restaurants were helpful in this connection; she had only to glance around her in such places to discover a world of handsome, graceful, unquestionably worthwhile men and women, who had somehow managed to transcend their environment – people who had turned dull jobs to their own advantage, who had exploited the system without knuckling under it, who would certainly tend, if they knew the facts of the Wheelers’ case, to agree with him.”
Yates tackles the suburban landscape, reminiscent of Cheever and Updike, something that did not resonate particularly with me when I first read the book, but after having lived in the Westport, Connecticut area for some thirty years, now has a special meaning. Yates’ portrayal is more scathing, depicting a desolate place where desperate people, lonely and unsure of themselves, toiling away in an era of placidity on the surface with deep anxiety running beneath. He describes the neighborhood as “invincibly cheerful, a toyland of white and pastel houses whose bright, uncurtained windows winked blandly through a dappling of green and yellow leaves.” The women raise the kids in their manicured homes and the men do battle in the city, snaking their way on the commuter railroad with their hats and their newspapers. Yates describes Frank, “…riding to work, one of the youngest and healthiest passengers on the train, he sat with the look of a man condemned to a very slow, painless death. He felt middle-aged.” This is as sad a depiction of the American dream’s corruption as could have been conjured up by Fitzgerald.
Frank works at his father’s old firm, a veneration of cynicism on his part. He gets a job in the Sales Promotion Department at Knox Business Machines, deciding “it would be more fun not to mention his father in the interview at all.” “The sales what? [April inquired]….What does that mean you’re supposed to do?” “Who the hell knows? They explained it to me for half an hour and I still don’t know, and I don’t think they do either. No, but it’s pretty funny, isn’t it? Old Knox Business Machines. Wait’ll I tell the old man. Wait’ll he hears I didn’t even use his name.” “And so it started as a kind of joke. Others might fail to see the humor of it, but it filled Frank Wheeler with a secret, astringent delight as he discharged his lazy duties, walking around the office in a way that had lately become almost habitual with him, if not quite truly characteristic, since having been described by his wife as ‘terrifically sexy’ -- a slow catlike stride, proudly muscular but expressing a sleepy disdain of tension or hurry.” Work too, is nothing more than a performance, something without intrinsic meaning, like other aspects of their lives.
Paradoxically, the one character in the novel who does not suffer from self deception, is their real estate agent’s son, John, who is an inmate in a mental institution, one who occasionally visits the Wheelers when he is released to his parents. When he learns that the Wheelers are not going to move to France and that April is pregnant, he says to them, first referring to Frank, “Big man you got here, April…Big family man, solid citizen. I feel sorry for you. Still, maybe you deserve each other. Matter of fact, the way you look right now, I’m beginning to feel sorry for him too. I mean come to think of it, you must give him a pretty bad time, if making babies is the only way he can prove he’s got a pair of balls….Hey, I’m glad of one thing, though? You know what I’m glad of? I’m glad I’m not gonna be that kid.”
Yates wrote six novels after Revolutionary Road. Among my favorites was Easter Parade, but Revolutionary Road stands on its own. He also had his short stories published in the two collections mentioned earlier, and, finally, he became more widely recognized with the publication of the Collected Stories of Richard Yates a few years ago. The wonderful introduction to this edition was written by Richard Russo who is yet another contemporary author influenced by Yates.
A must read article on Yates “The Lost World of Richard Yates; How the great writer of the Age of Anxiety disappeared from print” was published in the October/November 1999 issue of the Boston Review by Stewart O’Nan. He thoroughly covers Yates’ history and writing, but I was disappointed O’Nan failed to mention the edition of Revolutionary Road we kept in print for those ten years. Nonetheless, I would like to think our edition did its small part in keeping Yates’ extraordinary novel alive.
.
When our edition was published it was my intention to reread it, but career demands, other literary works, including all of Yates’ later novels and short stories, encroached on my reading time, so on various bookshelves in the homes we’ve lived, this edition nestled in waiting. The catalyst for recently rereading Revolutionary Road was the film of it, starring Leonardo DiCaprio and Kate Winslet. Reportedly, the book was “discovered” as a major American literary work by Kate Winslet and
her husband, the film’s director, Sam Mendes. The film seemed faithful to the novel so I finally read the reprint edition to see for myself. In the process I was reminded why I was so taken with Yates’ work in the first place.Since I am an “old” production guy, I have to describe the edition, republished without a jacket but in a library binding, 88 point binder’s boards, Arrestox "C" weight cloth with gold foil stamping on the spine, 5–1 /2 x 8–1/2 trim size, headbands and footbands, printed on acid free, cream colored high-opacity 50 lb paper. It was probably printed in Ann Arbor, Michigan where we printed the majority of our books. It looked as new as the day it was republished. So, I have come full circle with the book, reading it soon after it was first published, reprinting it when it went out of print, seeing the movie, and now finally rereading my reprint edition of the novel, with more than 40 years intervening.
As I said I thought the movie closely followed the book but after rereading Revolutionary Road, I am struck by its extreme faithfulness. Maybe this is because Yates’ elegantly developed plot moves chronologically and with an inevitability that drives the novel to its conclusion, making it so adaptable to the screen. But mostly, it is Yates’ living dialogue and although I do not have the screenplay to compare, I am certain much of it was wisely lifted from the novel itself.
When I first read the novel I was going through a divorce, having been married at the end of my junior year in college. My ex-wife and I were two kids, not unlike Frank and April in Revolutionary Road. I take literature very personally and the novel spoke directly to me as my own marriage was disintegrating and I was looking for answers.
The relationship of Yates’ men and women can be summed up by the titles of Yates’ two terrific short story collections: Eleven Kinds of Loneliness and Liars in Love. I was struck by these two themes, loneliness and self deception, as depicted in Revolutionary Road, relating those to my own experience, not only in my first marriage but the failed marriage of my parents (although they continued the pretense of a marriage to their deaths). Yates’ characters are perpetually struggling with one another, the men unsure of their masculinity, having to prove it in their work, their “need” to be loved by their wives, and to dominate women outside their marriages, while the women are highly neurotic and dependent but oddly headstrong and impulsive at the same time.
Towards the novel’s dénouement, April, exhausted from her struggles with her husband Frank, determined to follow through on aborting their third child, sends Frank off to work with a little kiss. Frank is confused, astounded, but grateful as he goes off to catch his train. April thinks it was “…a perfectly fair, friendly kiss, a kiss for a boy you’d just met at a party. The only real mistake, the only wrong and dishonest thing, was ever to have seen him as anything more than that. Oh, for a month or two, just for fun, it might be all right to play a game like that with a boy; but all these years! And all because, in a sentimentally lonely time long ago, she had found it easy and agreeable to believe whatever this one particular boy felt like saying, and to repay him for that pleasure by telling easy, agreeable lies of her own, until each was saying what the other most wanted to hear – until he was saying ‘I love you’ and she was saying ‘really, I mean it; you’re the most interesting person I’ve ever met.’” Indeed, liars in love. It perfectly described my own experience and I’ve been hooked on Yates ever since.
Yates characters wear different personas, playacting their way through their lives, with a natural capacity for self deception and disingenuousness. The book begins with a play in which April acts in a community theatre production. For a month after April finds she is pregnant with this third child, she and Frank go through their own elaborate play, she wanting an abortion (supposedly for Frank’s sake) and Frank wanting the child (supposedly for moral reasons). Subliminally he realizes that the pregnancy will put to rest April’s impetuous desire to move to Paris and thus leave them with a “comfortable” suburban life: “And so the way was clear for the quiet, controlled, dead serious debate with which they began to fill one after another of the calendar’s days, a debate that kept them both in a finely drawn state of nerves that was not at all unpleasant. It was very like a courtship….His main tactical problem, in this initial phase of the campaign, was to find ways of making his position attractive, as well as commendable. The visits to town and country restaurants were helpful in this connection; she had only to glance around her in such places to discover a world of handsome, graceful, unquestionably worthwhile men and women, who had somehow managed to transcend their environment – people who had turned dull jobs to their own advantage, who had exploited the system without knuckling under it, who would certainly tend, if they knew the facts of the Wheelers’ case, to agree with him.”
Yates tackles the suburban landscape, reminiscent of Cheever and Updike, something that did not resonate particularly with me when I first read the book, but after having lived in the Westport, Connecticut area for some thirty years, now has a special meaning. Yates’ portrayal is more scathing, depicting a desolate place where desperate people, lonely and unsure of themselves, toiling away in an era of placidity on the surface with deep anxiety running beneath. He describes the neighborhood as “invincibly cheerful, a toyland of white and pastel houses whose bright, uncurtained windows winked blandly through a dappling of green and yellow leaves.” The women raise the kids in their manicured homes and the men do battle in the city, snaking their way on the commuter railroad with their hats and their newspapers. Yates describes Frank, “…riding to work, one of the youngest and healthiest passengers on the train, he sat with the look of a man condemned to a very slow, painless death. He felt middle-aged.” This is as sad a depiction of the American dream’s corruption as could have been conjured up by Fitzgerald.
Frank works at his father’s old firm, a veneration of cynicism on his part. He gets a job in the Sales Promotion Department at Knox Business Machines, deciding “it would be more fun not to mention his father in the interview at all.” “The sales what? [April inquired]….What does that mean you’re supposed to do?” “Who the hell knows? They explained it to me for half an hour and I still don’t know, and I don’t think they do either. No, but it’s pretty funny, isn’t it? Old Knox Business Machines. Wait’ll I tell the old man. Wait’ll he hears I didn’t even use his name.” “And so it started as a kind of joke. Others might fail to see the humor of it, but it filled Frank Wheeler with a secret, astringent delight as he discharged his lazy duties, walking around the office in a way that had lately become almost habitual with him, if not quite truly characteristic, since having been described by his wife as ‘terrifically sexy’ -- a slow catlike stride, proudly muscular but expressing a sleepy disdain of tension or hurry.” Work too, is nothing more than a performance, something without intrinsic meaning, like other aspects of their lives.
Paradoxically, the one character in the novel who does not suffer from self deception, is their real estate agent’s son, John, who is an inmate in a mental institution, one who occasionally visits the Wheelers when he is released to his parents. When he learns that the Wheelers are not going to move to France and that April is pregnant, he says to them, first referring to Frank, “Big man you got here, April…Big family man, solid citizen. I feel sorry for you. Still, maybe you deserve each other. Matter of fact, the way you look right now, I’m beginning to feel sorry for him too. I mean come to think of it, you must give him a pretty bad time, if making babies is the only way he can prove he’s got a pair of balls….Hey, I’m glad of one thing, though? You know what I’m glad of? I’m glad I’m not gonna be that kid.”
Yates wrote six novels after Revolutionary Road. Among my favorites was Easter Parade, but Revolutionary Road stands on its own. He also had his short stories published in the two collections mentioned earlier, and, finally, he became more widely recognized with the publication of the Collected Stories of Richard Yates a few years ago. The wonderful introduction to this edition was written by Richard Russo who is yet another contemporary author influenced by Yates.
A must read article on Yates “The Lost World of Richard Yates; How the great writer of the Age of Anxiety disappeared from print” was published in the October/November 1999 issue of the Boston Review by Stewart O’Nan. He thoroughly covers Yates’ history and writing, but I was disappointed O’Nan failed to mention the edition of Revolutionary Road we kept in print for those ten years. Nonetheless, I would like to think our edition did its small part in keeping Yates’ extraordinary novel alive.
.
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