The King Is Dead
They’re listening to Coldplay down on Wall Street:
I used to rule the world
Seas would rise when I gave the word
Now in the morning I sleep alone
Sweep the streets I used to own
The leverage party’s over for the masters of the universe. Shed a tear. When you trade pieces of paper for other pieces of paper instead of trading them for real things, one day someone wakes up and realizes the paper’s worth nothing. And Lehman Brothers, after 158 years, has gone poof in the night.
We’re witnessing the passing of more than a venerable firm. We’re seeing the death of a culture.
For years, accountants, rating agencies and Wall Street executives decided to shoot craps and collect fees. Regulators, taking their cue from a distracted President Bush, took a nap. The two M’s — Money and Me — became the lodestones of the zeitgeist, and damn those distant wars.
The biggest single-day market drop since 9/11 reminded me that when trading reopened on Sept. 17, 2001, and the Dow plunged 684.81 points, some executives backdated their options to reprice them at this postattack low to increase their potential gains.
So that’s what “financial killing” really means. No better illustration exists of a culture where private gain has eclipsed the public good, public service, even public decency, and where the cult of the individual has caused the commonwealth to wither.
That’s the culture we’ve lived with. It’s over now. Some new American beginning is needed.
When I taught a journalism course at Princeton a couple of years ago, I was captivated by the bright, curious minds in my class. But when I asked students what they wanted to do, the overwhelming answer was: “Oh, I guess I’ll end up in i-banking.”
It was not that they loved investment banking, or thought their purring brains would be best deployed on Wall Street poring over a balance sheet, it was the money and the fact everyone else was doing it.
I called one of my former students, Bianca Bosker, who graduated this summer and has taken a job with The Monitor Group, a management consultancy firm (she’s also writing a book). I asked her about the mood among her peers.
“Well, I have several friends who took summer internships at Lehman that they expected to lead to full-time job, so this is a huge issue,” she said. “You can’t believe how intensely companies like Merrill would recruit at Ivy League schools. I mean, when I was a sophomore, if you could spell your name, you were guaranteed a job.”
But why do freshmen bursting to change the world morph into investment bankers?
“I guess the bottom line is the money. You could be going to grad school and paying for it, or earning six figures. And knowing nothing about money, you get to move hundreds of millions around! No wonder we’re in this mess: turns out the best and the brightest make the biggest and the worst.”
According to the Harvard Crimson, 39 percent of work-force-bound Harvard seniors this year are heading for consulting firms and financial sector companies (or were in June). That’s down from 47 percent — almost half the job-bound class — in 2007.
These numbers mirror a skewed culture. The best and the brightest should think again. Barack Obama put the issue this way at Wesleyan University in May: beware of the “poverty of ambition” in a culture of “the big house and the nice suits.”
College seniors might start by reading “A New Bank to Save Our Infrastructure” in the current edition of The New York Review of Books, an impassioned plea from Felix Rohatyn (who knows something of financial rescues) and Everett Ehrlich for the creation of a National Infrastructure Bank, or N.I.B.
Its aim, at a time when the Chinese are investing $200 billion in railways and building 97 new airports, would be to use public and private capital to give coherence to a vast program of public works. “This can improve productivity, fight unemployment and raise our standard of living,” Rohatyn told me.
It’s absurd that earmarks — the self-interested budgetary foibles of senators and representatives — should dictate the progressive dilapidation of America. How can the commonwealth thrive when its bridges sag, its levees cede, its public transport creaks?
So, young minds, sign up for the N.I.B.! Before doing so, read Nick Taylor’s stirring “American-Made: The Enduring Legacy of the W.P.A.: When F.D.R. Put the Nation to Work.” It shows how the Works Progress Administration, a linchpin of Roosevelt’s New Deal, put millions of unemployed to work on dams, airports and the like. It’s a book about how imaginative political leadership can rally a nation in crisis.
They’re listening to Coldplay down on Wall Street:
Now the old king is dead! Long live the king!
Yes, the death of the old is also the birth of the new. In my end is my beginning. It’s time for the best and the brightest to step forth and rediscover the public sphere.
Link to article: http://www.nytimes.com/2008/09/18/opinion/18cohen.html
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