John Mack, Parties, and Misguided Outrage
A small item in Page Six speaks volumes about our societal shift.
It's true that a year ago, few could have guessed that Morgan Stanley (MS) would not only survive the credit crisis intact, but that it would do so with John Mack at its helm.
Today, Morgan Stanley is alive and well, and Mack is celebrating his survival of the crisis by embracing retirement at the end of this year. But, unlike Goldman Sachs (GS) CEO Lloyd Blankfein, the target of relentlessly brutal floggings in the court of public opinion, John Mack hasn't taken to the proverbial rooftops to announce to anyone and everyone that his firm won't be holding a holiday gala this year.
But in fact, there will be no firm-funded extravaganza this season for those who toil for Morgan. However, Mack will be feted at a retirement party described by the New York Post's Page Six gossip roundup as "low-key."
Now, let's belly up to the bar here for a glass of perspective.
Page Six lists four writers on its masthead who, each day, collectively dole out between two and three pages of juicy morsels -- more often than not planted by publicists -- that generally involve one or more or all of the following "news" items:
- Alex Rodriguez and the state of his relationship with Kate Hudson.
- The whereabouts and activities of Jay-Z and Beyonce.
- Where Donny Deutsch/Bethenny Frankel/Howard Stern were seen eating and what they ordered.
So it was a bit surprising earlier this week when, sandwiched between a piece on Lindsay Lohan's used clothing and an item about pop singer Rihanna, there was a short item about how John Mack will be sent off with a "modest affair" at Times Square's Marriott Marquis hotel. An insider told the paper that "Morgan Stanley employees who possess talents other than making money are creating videos to be played at the party."
Surely, the videos will be entertaining and those in attendance will enjoy a few good laughs at a string of somewhat amusing inside jokes. The deeper question still remains, though: Is this really where we've ended up as a society?
Has the outrage really reached such a fever pitch that a global investment bank's public-relations department is spending time and resources attempting to convince the readership of a local New York tabloid with a circulation of 724,000 that the outgoing CEO isn't being sent off with an extravaganza a la Blackstone's (BX) Stephen Schwarzman's 60th birthday party? (Comedian Martin Short was the MC, Marvin Hamlisch played, Patti LaBelle sang an original song written for Schwarzman, and Rod Stewart performed a medley of hits, for a reported fee of $1 million.)
Of course, such a display would serve no one's best interests today. Not even the birthday boy's.
The big banks are giving out $26.8 billion in bonuses this year. Seventeen million Americans have lost their jobs and one in 10 is unemployed. Take a look at the findings of a Bloomberg poll:
Two-thirds of Americans have an unfavorable view of bank executives.
One-half said that the government shouldn't have bailed out the bankers.
Three-quarters said that bankers whose banks received government aid shouldn't be paid bonuses.
Nearly two-thirds said bailing out the banks was a bad idea. (See also: Americans: Angry and Very Confused.)
Rejoice, fellow Americans! Lobster is off the menu and thrift reigns supreme! In its annual survey on holiday parties, global outplacement firm Challenger, Gray & Christmas reported that 62% of companies are planning holiday parties this year, down from 77% a year ago, and nearly a third of them are spending up to 20% less.
In the case of John Mack, doesn't it feel good to know that one of Wall Street's wealthiest has finally been cut down to size? That he won't be drinking vintage champagne? That he won't be spending the money he himself earned on a celebration after a long, successful career?
Not to the owners of event spaces struggling to fill their calendars with paying customers this year.
Not to the myriad out-of-work actors and actresses who have one less catering gig this Christmas.
Not to the city and state of New York who could really use the tax revenue.
Joseph Palermo, an Associate Professor of History at Cal State, Sacramento, had this to say in the Huffington Post:
The right-wing media does everything they can to distract attention away from the real culprits on Wall Street. They say its Barney Frank's fault or Fannie (FNM) and Freddie's (FRE) fault or the Democrats' and their "Community Reinvestment Act" or stupid home buyers who should have known better, etc. But no matter how many Red Herrings they toss out the American public has already made the explicit connection between their suffering and the wild party that is still raging on Wall Street. That's why there's so much anger directed at "bonuses" and "executive compensation." The caps placed on the pay-outs to a handful of Wall Street scapegoats might feel good but it doesn't do anything to address the underlying injustices of living in a plutocracy.
Sure, it feels good until the "drunk" wears off. As Homer Simpson famously said, "Beer! Now, there's a good temporary solution!"
John Mack's "common man" retirement party is no more than the equivalent of drinking to forget about a problem.
Morgan Stanley will spend a bit less to say goodbye to its outgoing CEO. The deeper issue will still be there in the morning. And it has absolutely nothing to do with whether or not they serve stone crab claws or Big Macs.
It's time to stop vilifying those who have seen success and time to start realizing that fulfillment has little, if anything, to do with who dies with the biggest bank account.
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