The big bucks start here
Reviewed by Nury Vittachi
CAPITALIST FOOLS By Nicholas Von Hoffman (Chatto and Windus, $195) WHAT would you think of a man who owed his life to baked beans? Not much? Well consider Anthony J.F. O'Reilly. It has been estimated that as chairman of H.J. Heinz and Co, he, in one year, earned stock options worth US$120 million - the equivalent of HK$936 million.
Knock off non-working days, and you have a story of a man who comes home to his wife every day bringing home half a million US dollars. Can you imagine his normal greeting? ''Hi, Honey. I had a good day. I bought home the annual GDP of a small African nation for you.'' But, believe it or not, today's mega-rich are less rich than yesterday's mega-rich, argues Nicholas Von Hoffman, in this new book on the growth of business.
In 1918, John D. Rockefeller was worth an estimated US$1.25 billion. Depending on how you calculate inflation, that would be worth between US$15 billion and US$30 billion - more money than super-rich individuals have today.
Capitalist Fools is a big, sprawling, messy book about the development of American business this century. It started off as a biography of Malcolm Forbes, a man who made money into a sexy subject for a glossy magazine in the same way that Hugh Hefner made sex and the high-life into the same thing.
The writer, Nicholas Von Hoffman, is a financial columnist who is, by turns, anecdotal, discursive, informative and infuriating. Sometimes he is facetious and insults the reader. For instance, he points out that some of the financiers he writes about dida great deal of good, ''unless one believes power plants and factories and office blocks . . . will pop up by themselves if one sits under a New Age crystal long enough.'' The reader is left wondering what he has done to deserve this nasty dig.
What is more fun is to watch Mr Von Hoffman insult the rich and famous, which he does very well, frequently hanging them using their own rope.
John Teets, chief executive of Greyhound, boasts about how tough he is, and how he does not like to know his colleagues as human beings, in case he should feel obliged to be sympathetic: ''I'm tough. Tough like leather, with just enough give to take a beating all day long and not shatter . . . I've got a senior executive whose wife had two lumps in her breasts. I don't want to know about it. I do it so when I weigh a business decision, I don't have all that luggage that a guy's wife isn't well.'' One of the most telling lines in this book is a footnote where the writer tells readers what a leveraged buy-out is and what the interest rates are on the junk bonds that support them.
''When the Mafia charges such interest rates it's called loan sharking and their dons are put in the penitentiary. When the Dough Boy or Salomon Brothers or Morgan Stanley sell you one, it's called investment banking and their dons are put on the cover of Fortune magazine.'' This violently critical attitude also comes out in a piece on William Zeckendorf who juggled money to make a fortune out of property. Mr Van Hoffman quotes Zeckendorf's complex system of money-juggling. Then he adds: ''When you hear a financier, banker or industrialist talking like that, call the bunco squad and run like hell.'' There are faults with this book. It is formless and rambling, and keeps revealing its supposedly abandoned origins by returning to the subject of Malcolm Forbes.
But it is very good at showing just how much of modern culture can be directly traced back to the activities and ideas of American businessmen. And it tells this story with a delicious cynicism.
Here is Mr Von Hoffman writing about public relations firms' attempts to re-design business men as big-hearted contributors to society.
''Under the eyes of the invited media, the PR flacks had [Michael] Milken and some of his co-workers, as avariciously anti-social a group to assemble outside of a penitentiary, take slum children to Sea World in San Diego, pizza parties in Salt Lake City, a zoo in Philly and a circus in Dallas.
''The reclusive Milken, who hates to touch human flesh, was made to personally lead nearly 2,000 inner-city kids to a baseball game, where he bounced one of the little bastards on his knee.''