(Harper Collins, New York, $25.85) 282 pages
by Tom Barbash
Reviewed by Gregory Bresiger
Take a disaster such as the tragic September 11. Consider its effect on a
firm trading equities and bonds, a firm in which most of the assets of the business were truly lost as the towers came down. Have a bunch of tabloid tube personalities – many of whom have no more understanding of trading or business than a pig understands Sunday – explain it to us.
Now what happens?
You have a second disaster, a disaster of misunderstanding as the tube personalities attempt to demonize Howard Lutnick, chairman of Cantor Fitzgerald. This book, which was written by a college friend of Lutnick, chronicles his experience and those of his firm pre- and post-9/11. Lutnick's brother and best friend died in the terrorist act and his firm almost went down with the World Trade Center towers. Lutnick missed death because he was taking his son to school on that fateful day.
Lutnick's problems begin with tabloid elements of the tube media, according to this book. They include criticism leveled at him by the notoriously moronic Connie Chung, the hotheaded Grand Inquisitor Bill O'Reilly and the always-simpleminded Barbara Walters. They are a few examples of media big shots that, in the months after September 11, all but branded Lutnick as the anti-Christ.
Cantor Fitzgerald lost most of its stars in the World Trade Center crash and faced a struggle for survival. Seven hundred of its most talented people died on September 11. Three hundred shell-shocked survivors were left to carry on. Competitors could sense that they could take business from the once mighty Cantor Fitzgerald. But that was probably not the biggest problem. Media vultures were waiting for Lutnick.
The media feeding frenzy began after September 15. Just after the tragedy, Lutnick, in some emotional interviews that included crying on television when he reflected on the deaths in his business and his family, made some hard choices.
With Cantor Fitzgerald facing a battle for survival, Lutnick believed that those killed in the terrorist act had to be taken off the payroll.
"In Howard's mind, there was no choice – if he continued to pay the salaries, they'd lose the company." (page 67.) He also decided that medical and other benefits for the families of the victims would continue for 10 years and the families of the victims would receive 25 percent of Cantor Fitzgerald's profits for the next five years. (Estimated to be some $150 million).
Profits and bonuses were rather dicey propositions because who knew if the firm could remain in the black. And the man in charge of the bonuses died in the disaster. Also, many of the families didn't understand exactly how bonus money is generated.
Still, many of them also thought spouses were generating big money. That's even though it had been a bad year. A Cantor Fitzgerald relief fund was also set up. The tabloid tube masters, led by the idiotic Chung, jumped on the payroll decision and simply ignored everything else, especially factors that didn't fit in with their Lutnick is a devil thesis.
Network Star
Before I proceed, let me offer some background on Chung. Chung, who initially called Lutnick "remarkable" in her first interview after the tragedy, has worked for all three major networks. She now works for CNN. She is the apotheosis of the network news star who often has little idea what she is talking about. She is thrown into all manner of stories not because she has some expertise, but because she "looks good" and makes a good appearance on television.
Ted Baxter was a caricature of TV news types on the Mary Tyler Moore Show of the 1970s. Connie Chung is a frightening reality. Millions of people believe in her. Indeed, for millions of Americans, she provides, for many people, their view of the world (God help our republic). She has been a network news star for decades.
Several years ago – without any expertise in medicine or science – she presented a series of exposes on breast implant operations. Here was her evidence: She interviewed a series of women whose operations had gone badly. This purported to prove how bad all these operations were. Some frightened women who had successful operations pulled them out after this expose.
Chung will strike again. She announced that Cantor Fitzgerald should have never cut salaries. O'Reilly insinuates that Lutnick's public emotions are phony. "Behind the scenes," O'Reilly archly announces, "something very disturbing may be going on." (page 99.)
One of O'Reilly's thoughtful viewers tried to persuade him that he's made a mistake: "Hey, Mr. O, take a deep breath. The reason the company can't help the families is that eighty percent of it is gone. There is no there there." (page 116). O'Reilly dismissed the comment.
On ABC's notoriously moronic 20/20 show, airhead Barbara Walters leads into a segment by Chung with a comment suggesting that Lutnick was faking when he cried on camera. "But what happened after the cameras went off turns into another story. As Connie discovered, actions speak louder than words–or tears." (pages 142-143.)
She interviews one widow on Lutnick: "He's never treated anyone kindly in the firm." (page 143). Unfortunately, the viewer isn't also told that there were several wives who thought Lutnick's plan was good. Many of these same wives will call Lutnick later to tell him this. They will also say that they were interviewed but "their interviews never aired." (page 144.)
Hate Mail
Demonstrating the power of the tube to distort, hate mail and faxes rein down on Lutnick. Contributions to the Cantor Fitzgerald relief fund dry up. Still, Chung asks how Lutnick could have "cut the families off at the knees." (page 63). There was no need to do that, Chung claims. Cutting salaries "would hardly have bankrupted Cantor," she claims (page 143).
Really? How does she know? She doesn't. Lutnick says, nevertheless, that there were numerous elements in the media that got the story right; reporters and editors who weren't on a mission to destroy him and his firm. The truth may have eventually caught up with the clowns like O'Reilly and Chung, but the tabloid big shots had moved on to better things.
In the fourth quarter of 2001, remarkably, Cantor Fitzgerald still turned a profit. Bonuses are paid. The firm, with the help of many, goes on. Were Connie Chung and Bill O'Reilly doing exposes on how the firm survived unimaginable hard times?
Lo dudo.
This is a depressing story. But it is also one of hope and renewal. It is also one of caution. There should be a sign beside every idiot box in the nation: caveat viewer.
