There has been a spate of news reports of aggrieved plutocrats grumbling about how mean people are to them these days, and how nobody seems to appreciate the fact that they worked hard for their money unlike the rest of us moochers and looters and that they are so exceptionally gifted that they deserve even more. While much scorn has been directed at those who have said these things publicly, what they say among themselves privately is even worse.
Reporter Kevin Roose published an article in New York magazine about what he saw when in 2012 he crashed an induction party for the initiation of new members into a secret and exclusive Wall Street fraternity known as Kappa Beta Phi that is made up of Wall Street CEOs and executives. It involved a hazing ritual that required the initiates to dress in drag, tell jokes, and sing songs, which were strongly homophobic and disparaging of those who were not wealthy. What struck him most forcibly was how, even after the financial crash caused by Wall Street and the financial sector, these people seemed to have no sense of guilt or responsibility for the misery they caused to so many.
When he was detected, he was asked to leave but tellingly, they tried to bribe him to not write about what he had seen.
Before the situation could escalate dangerously, a bond investor and former Grand Swipe named Alexandra Lebenthal stepped in between us. [billionaire investor] Wilbur Ross quickly followed, and the two of them led me out into the lobby, past a throng of Wall Street tycoons, some of whom seemed to be hyperventilating.
Once we made it to the lobby, Ross and Lebenthal reassured me that what I’d just seen wasn’t really a group of wealthy and powerful financiers making homophobic jokes, making light of the financial crisis, and bragging about their business conquests at Main Street’s expense. No, it was just a group of friends who came together to roast each other in a benign and self-deprecating manner. Nothing to see here.
But the extent of their worry wasn’t made clear until Ross offered himself up as a source for future stories in exchange for my cooperation.
“I’ll pick up the phone anytime, get you any help you need,” he said.
“Yeah, the people in this group could be very helpful,” Lebenthal chimed in. “If you could just keep their privacy in mind.”
This incident is a classic example of ‘access journalism’, so widely practiced in the establishment media, whereby major figures promise a reporter access to themselves in return for portraying them in a favorable light. It is utterly corrupting but businesspeople and politicians on the one hand and reporters for big media on the other indulge in this practice shamelessly, the former to make themselves look good and the latter in order to get stories to pad their bylines.
Roose fortunately did not succumb and as he left he pondered on the significance of the night’s events.
As I walked through the streets of midtown in my ill-fitting tuxedo, I thought about the implications of what I’d just seen.
The first and most obvious conclusion was that the upper ranks of finance are composed of people who have completely divorced themselves from reality. No self-aware and socially conscious Wall Street executive would have agreed to be part of a group whose tacit mission is to make light of the financial sector’s foibles. Not when those foibles had resulted in real harm to millions of people in the form of foreclosures, wrecked 401(k)s, and a devastating unemployment crisis.
The second thing I realized was that Kappa Beta Phi was, in large part, a fear-based organization. Here were executives who had strong ideas about politics, society, and the work of their colleagues, but who would never have the courage to voice those opinions in a public setting. Their cowardice had reduced them to sniping at their perceived enemies in the form of satirical songs and sketches, among only those people who had been handpicked to share their view of the world. And the idea of a reporter making those views public had caused them to throw a mass temper tantrum.
The last thought I had, and the saddest, was that many of these self-righteous Kappa Beta Phi members had surely been first-year bankers once. And in the 20, 30, or 40 years since, something fundamental about them had changed. Their pursuit of money and power had removed them from the larger world to the sad extent that, now, in the primes of their careers, the only people with whom they could be truly themselves were a handful of other prominent financiers.
Perhaps, I realized, this social isolation is why despite extraordinary evidence to the contrary, one-percenters like Ross keep saying how badly persecuted they are. When you’re a member of the fraternity of money, it can be hard to see past the foie gras to the real world.
Roose’s party-crashing was part of research for an upcoming book titled Young Money where he shadowed eight young people just starting out in Wall street careers and on NPR he talked about what he found, saying that many of their experiences could be summed up by the experience of one of them with the pseudonym Jeremy.
Jeremy’s new boss asked him why he came to Goldman [Sachs]. Jeremy said something along the lines of, helping companies to hedge their fuel costs is this great function of the capital markets, and eventually those savings will get passed onto customers. His boss cut him off: “Dude. If you’re not here to make money,” Roose paraphrases, “this isn’t the place for you. We’re not here to save the world. What you’re here to do is make a lot of money for yourself and for the firm.”
That’s the kind of greed-is-good motivational speech that would have energized Wall Street recruits in the past. But, Roose says, Jeremy was a little shaken up. That’s in line with studies about what millennials want out of a job these days. Even if the job doesn’t actually fulfill a higher purpose, today’s young people want to feel like it is anyway.
Roose says that Wall Street seems to have lost some of its glamor and ability to attract and keep young people, with Silicon Valley becoming the new Mecca. Of the eight young people he shadowed, only three are still in finance and of them only one seems truly happy at the job.
But we should not see this as an unmitigated good. If the people who have at least some scruples are the ones who leave, the ones who remain will be the most greedy and uncaring of the lot and will continue to wreak havoc.