During the 1980s, bright young people—lured by the promise of enormous salaries and commissions that recent deregulation had made possible—began pouring into the once-stodgy industry of investment banking. Philip Weiss captured this trend and its implications in his 1986 profile of Steven Rattner, a brilliant New York Times reporter turned investment banker. (Rattner was in the news again recently when he was tapped by President Obama to oversee the bailout of Detroit, but resigned after a brief tenure for personal reasons amid suggestions of impropriety.)
n a night in August 1982, in a loud New York restaurant off Union Square, Steven Rattner, a London correspondent for the New York Times, and Roger Altman, an investment banker at Lehman Brothers, met for dinner to discuss Rattner’s future. The two had become good friends a couple of years earlier when Altman was an assistant secretary of the treasury and Rattner was covering Jimmy Carter’s economic policy for the Times.Now Rattner, at the age of thirty, had decided he wanted to leave journalism.
Rattner was one of the Times’s ablest writers. His rise in the organization had been rapid: at twenty-two, clerk to the legendary columnist James Reston; at twenty-three, covering energy, one of the most important stories in the country; at twenty-four, a full member of the Washington bureau; at twenty-nine, a foreign correspondent in a prestige bureau. But by the summer of 1982, Rattner felt he needed a change. It was a good time to become an investment banker. Banking was changing, and Rattner had the personality for its competitive new environment of short-term relationships. His persuasive skills would be useful on deals, Altman told him. Working a client wasn’t so different from working a source.
Altman was certainly right about it being a good time for banking. The new spirit of competition brought about by deregulation combined with the rise of a new materialist ethic, especially in Manhattan, had made investment banking glamorous in much the same way that journalism had been in the years after Watergate. Investment bankers and arbitragers were being profiled in mainstream publications like Esquireand the Atlantic. Radio stations quoted the gold price between rock songs.
But was this the right world for Rattner? As a student at Brown, Rattner had written idealistic editorials proclaiming that the country’s moral fiber was “weak” and denouncing “global … corruption and disdain.” It would seem only natural for such a person to wonder aloud whether Lehman Brothers offered avenues for socially useful work. But Altman does not recall that Rattner raised the question of whether investment banking was meaningful work except, he said, “in this sense. He wanted to know whether he’d be fulfilled by banking. Was it overly narrow?” Rattner asked Altman whether investment bankers ever lifted their noses from their spreadsheets. He was a young man who had lived abroad and traveled widely. He had a feeling for good art. Altman assured Rattner that he would meet people who shared his intellectual curiosity and cultivation.
Rattner took the job. Barely a year and a half later he moved to the New York Timesof investment banking, Morgan Stanley & Company, where in 1985 he brought in a stunning $33 million in fees. After just eighteen months, he was promoted, at age thirty-three, to “principal,” a partner who cannot vote on firm policy. The jump usually takes six years. When he left the Times,Rattner was earning about $50,000 a year; last year he is said to have made as much as a million. Rattner specializes in deals involving communications companies. Most of his time is devoted to mergers and acquisitions—helping to buy and sell media properties. In some cases, these efforts may have served to compromise the editorial quality of news organizations that, like the New York Times,have been known for valuing the product more than the bottom line.
In any age, there are certain people who, because they are both very smart and unusually reactive to their society, help illuminate prevailing values through their actions. Rattner’s life seems emblematic of the spirit of the times. Rattner’s career path, impressive as it is, has a conformist quality that calls to mind the Woody Allen character Zelig, the “chameleon man” who always took on the coloration of those around him. When journalism defined the spirit and values of a generation, Rattner was a journalist. Now that investment banking defines those things, he is an investment banker. This chameleon quality makes Rattner an instructive case study of the process by which many of today’s best and brightest have lost interest in making a difference with their lives.
rthur O. Sulzberger, a longtime friend of Rattner’s and the (more than likely) future publisher of the Times, said Rattner had many layers—implying, as other close friends have, that if Itook his banker’s bluster at face value Iwould miss out on his deeper concerns. “He’s a very complicated sort of man, with a lot of things going on in his life, some of which he’ll let you know about and some of which he won’t.” After that Sulzberger spoke of the quality of Rattner’s mind. Then he broke off and said, “All that intelligence—why doesn’t he put it to good use?”
“Are you joking?”
Sulzberger shook his head. He said he teases his friend about the social worth of his work. On one hand he thinks his “moral values” have not changed and it’s good to have people in business with a sense of social purpose. On the other hand, as his investment banker friends know, Sulzberger is “troubled” by the values of banking.
He may also be worried that Rattner has started an exodus of Times reporters to Wall Street. Last year Michael W. Blumstein, at twenty-nine,left the business desk of the Times to become an analyst at First Boston. Blumstein said he had always loved journalism, and even thought he was making a social contribution when he wrote about such corporate maneuvers as “defeasance,” a complex way to escape debt. But he didn’t feel he could afford to live in Manhattan on an income in the high forties. It also distressed him that by age thirtyhis salary would be topping out.
When Blumstein finally heeded “the tape” (Wall Street’s expression for the direction of the market) and left the Times, no one told him he had sold out. “People thought, you’re making a smart move for yourself,” he said.
asked Rattner to compare the social worth of reporting with that of investment banking. He sat back and held the bridge of his nose. “I have two answers,” he began. “I guess in the cold light of—No, I don’t know if that’s true either.” It was about the first time he’d faltered that afternoon. He paused, then spoke slowly. “It’s something I’ve thought a lot about. I don’t view investment banking as the ultimate social fulfillment to me. I do it because I like what I’m doing. And yet we all do have a responsibility to put something back. Being an investment banker for the last three years has made me realize more what all of us should do. I’m a failure at discharging all my social responsibilities. When you’re a journalist, though, you convince yourself of your social usefulness and you don’t worry about it. Being an investment banker strips that away. I won’t tell you that it is a socially responsible profession, whatever the hell that means, but won’t say journalists are either.”
Later, he said he often felt that reporters were motivated by the desire for glory and to “hobnob with the great and near great.” It’s a point to consider. Much as we might want it to, no job confers virtue automatically. What matters is the moral content of our actions in that job. What is troubling about Rattner is that in recognizing that no profession is inherently moral, he also seems to have given up on the idea that individuals should strive to be useful to society.
bout two years after Steve Rattner’s dinner with Roger Altman, Rattner attended a dinner held by James Reston on the eleventh floor of the Times. The columnist was turning seventy-five, and he wanted to throw a party for his clerks. Eight tables were set up in the publisher’s dining room, but when Reston saw the arrangement he directed that there be one big table, because the clerks were a family.
Fourteen clerks came. Reston ran the show. In his casual way he went around the table, apostrophizing one after another of those present. “And then there was the one who came up to me after a speech in Chapel Hill, with his hands dirty with printers’ ink,” he said, and everyone understood that he was talking about Jonathan Yardley. Then Yardley took up the conversation and recounted a story about Reston. Reston next got in a dig at Abe Rosenthal about one of Rosenthal’s great frustrations, how long it had taken him to get on the foreign desk.
Then it was Rattner’s turn. Reston looked down the table in a fatherly way and said, “And then there was the one who left the fold. When are you coming back?”
Rattner defused the tension with a joke, but behind it there was apparently a lot of feeling. “Mr. Reston thought very highly of Steve, and I think was very disappointed but understanding when Steve made the career choice he did,” Philip Shenon says. Beyond the personal attachment, some clerks say that those who signed on as clerks implicitly made a pact with Reston, and when one left the family, Reston was said to feel it as a personal failure.
It’s hard to think of Reston—aging, ponderous, respectful of the establishment—as a role model for an aggressive reporter today. It might even be that Reston is the person Rattner had in mind when he told me he thinks journalists are motivated by their desire for glory and the chance to hobnob.
Both the Times and journalism in general invite such disregard. And former Times man J. Anthony Lukas points out that reporters don’t have pure motives. “Especially after the civil rights movement, Vietnam, and Watergate, we were able to feather our financial and professional nests at the same time we were exposing inequities. The journalist is not an unmitigated crusader. He is an ambiguous figure.”
This is much more apparent today than it was in the 1970s when Steve Rattner was inducted into the profession. As the glamour of journalism wears off—at least in the realm beyond the Beltway—we discover that not every reporter is out to make the world a better place to live in. But the answer isn’t to conclude that what you do doesn’t matter. For all his complacency, James Reston understands that. The other day, in one of his benign rambling columns, Reston expressed the hope that youth today doesn’t just want security but is looking for “purpose and even service.” Iwonder if anybody was reading.