Autumn of the Moguls

by Michael Wolff

  Boredom, restlessness, the need-for-validation thing, the desire to be taken seriously, to be recognized and fawned over by people who don’t work for you, often bring men from unglamorous businesses into the media business and into politics.

  After all, Bloomberg’s business—his real business—is a deeply boring one. It’s an old-fashioned, single-function, almost idiot-savant-type business. Twenty years ago, he managed to monopolize data relating to the bond market. There’s no ticker for the bond market; there’s no SEC-like agency that files information about bonds. Bloomberg, with a vast database operation in Princeton, turned himself into a repository of prospectuses for the fixed-income marketplace. That’s his business—that’s why most of his nearly 160,000 clients lease his kludgy machines. The overwhelming share of his company’s $2.5 billion in annual revenue derives from the need for his bond data. That’s his advantage. It’s his annuity—and like most annuities, it’s on autopilot.

  No doubt it’s a little stifling. The database business is the modern equivalent of an assembly line. What’s more, every other part of the financial-information business is a tough game—Bloomberg tried to get a bigger piece but without much success. To have substantially grown, he’d have to take on big debt or go public and buy some other big financial-information or media company—and risk, or at least complicate, his safe annuity. (Bloomberg was in the increasingly anomalous position of running a private company, unhampered by public accountability; certainly he wouldn’t have been able to run for mayor if he had to run a public company.)

  In a way, because of the boredom and the autopilot nature of making the money, the company became a two-tier enterprise. There were the people who actually processed the data and sold the product, and then there were the people who tended to and marketed Bloomberg himself—his personal handlers and advisers, the company’s real powers.

  Bloomberg, the man, conceived and packaged as a separate Bloomberg company product, came to market shortly after his marriage broke up in 1993. There was an I’ll-show-her aspect to his sudden reinvention. (She, apparently, left him.) It started with a concerted effort to move into big-time philanthropies—from the Central Park Conservancy to Lincoln Center to the Metropolitan Museum—then involved a stagy social life (a date with Diana Ross) and the move into radio and television.

  It was a rebranding program.

  There was an implicit sense that a recognizable Bloomberg with $2.5 billion in revenues was worth more than an unknown Bloomberg with that same $2.5 billion.

  “Radio and television provide our company with instant visibility,” he writes excitedly in his book, Bloomberg by Bloomberg. “The media like nothing better than writing about themselves. The more exposure Bloomberg has to the Fourth Estate, the more they’ll promote us to the general public.”

  He’s making a knowing point. The media gets the attention of the media. Getting the media to take you seriously is the campaign.

  Bloomberg people are always speaking of this hustle—and of its great success. The Mike York Times, Bloomberg people call the paper, because of its reliable, respectful, business-page coverage of Bloomberg. (Bloomberg was also providing the Bloomberg financial news service free of charge to the Times.)

  But why politics? He’s not personable enough (he may be among the least charming people ever to have run for office), or charismatic or even interesting enough, or ideologically motivated enough (he was a Democrat; then, taking advantage of the easier field of play, he became a Republican). Certainly, he isn’t politically talented enough and doesn’t seem particularly interested in learning how to be politically talented. And even if he were all of the above, he’d still need that fluke circumstance that allows a Republican to get elected in New York City. What’s more, his résumé is fraught with the kinds of things—sexual-harassment suits, for instance—that don’t exactly help a fledgling politician.

  But running for office, if you don’t care about being elected, and if you can easily cover the amount of money it will cost, may be a really smart money play.

  If publicity is the currency of our time, running for mayor of New York could very well raise your personal value substantially. And if you’re as uncharming as Bloomberg, running for office might actually make you seem more charming—ramp up your Q. rating. What’s more, by seeming to go after the average voter you reach your real constituency: reporters, celebrities, hostesses, titans of business, customers, possible dates. Running for mayor is an in-crowd play (“The social set in New York has discovered him,” Barbara Walters told the Times during the campaign).

  Indeed, sometimes selling yourself is easier than selling your business. A telling element of the Bloomberg pitch—I’m a good manager; therefore, I should run the city—was that, in fact, the real forum for having your management skills voted on is the public markets, which he’s avoided. Most companies the size of Bloomberg’s that decide not to go public do so because the process would reveal they’re not too profitable and not all that well managed, hence depressing their value. But Bloomberg, by running for mayor, a process with fewer disclosure requirements, was able to trumpet his management prowess—go public with it—without having to prove it. We took his word that he’s good at business; in fact, we took his word that he’s worth billions.

  That’s the illusion he’s marketing, and, even if we didn’t vote for him, the one we’re buying. Bloomberg wasn’t really running to be mayor; he was running to be some different, enhanced, illusory version of Michael Bloomberg.

  But then he won, surprising nobody as much as himself. And confusing everyone else.

  Bloomberg as mayor is so odd—not necessarily unattractive, just without precedent—that you look at him and find yourself thinking, especially if you’re in the media business, especially if you’re a mogul or would-be mogul type. What does this mean? What does Michael Bloomberg signify?

  It’s a paradigm shift.

  We haven’t ever elected men who’ve made a ton of money—not megamoney, not robber-baron money. Even in a nation where “self-made” is the greatest title, there have always been those few who are so self-made, so singular, that we haven’t considered them to be part of the same striving experience. We haven’t, at least in the past, liked people to be that unique—that independent.

  Who would trust such men? That kind of money—unlimited, unimaginable amounts of it—naturally breaks the popular connection (and who does not hold the Capra-esque belief that such men are the poorer for it?).

  That a great crime lies behind every great fortune has been a basic American sentiment. Where there’s great profit, somewhere else there’s been great loss. (You were a financier who’d stolen money from widows or orphans, an industrialist who’d made it off other men’s labor, or a monopolist who had bought off politicians—or all three.) Such men had made their deal with the devil. The more money they made, the dirtier their business—hence “filthy” rich. They had blood on their hands. They were capable of anything (out of such omnipotence, conspiracy theories were born).

  Their all-powerfulness (they would certainly have been as insulated and as pampered and as fawned over and as flattered as any aristocrat ever was) necessarily made them undemocratic, to say the least. And autocratic and authoritarian. Chosen. God, J. D. Rockefeller said about his money, had given it to him.

  On the occasions when we elected their children to high office, it was because they’d made a public break with business, with the act of making money. Public life was an act of contrition. To whom much is given, much is required, the Kennedy and Rockefeller heirs went around saying.

  But now the bar against electing outlandish, unimaginable, otherworldly wealth has been lifted. In fact, staggering sums of money, and the freedom and power (not to mention lifestyle) such sums give you, become a political virtue.

  In the past, rich men or the heirs of rich men have run or flirted with running, but, in the manner of rich men, have often turned cheap in the process. Even old Joe Kennedy once sai
d he didn’t want to pay for one more vote than he had to. That is not the spirit now. Not only is the calculation different, but the act of spending, of being able to outspend what has been spent before and to inflate the underlying cost of the entire process, is a kind of demonstration of your willingness to give it your all. Cheapness is not a political virtue.

  Obviously, this new tolerance and admiration for the superrich has to do with the ethos of the time. In the nineties, so many people seemed to be on their way to becoming among the richest people who have ever lived, that the idea that this was a special, or weird, or even monstrous status went away. Getting to be this rich even made you seem like something of a Boy Scout. You worked long hours, had a head for numbers, gave people what they wanted. Warren Buffett is rich, we believe, not least of all because he is a mensch.

  Even the recent dramatic reversal—the undoing of many of the theoretically rich—has buttressed the reputations of the genuinely rich. It turns out to be so hard to hold on to money or to turn paper wealth into the cash stuff that the singular men who are real, no-shitting-anybody gazillionaires deserve special recognition.

  Here is something else: The really rich used to run from publicity. They didn’t want to inflame the envy of common people; they didn’t want to expose themselves to muckraking scrutiny; they didn’t want to endanger the security of their families. But in the current age, when publicity has become a clear and monetizable asset, the really rich went after their due. They sought celebrity status and were eagerly granted it. They demystified themselves, packaged themselves. They became as real to us and as attractive as, well, other celebrities (which has enabled their daughters to pursue modeling careers).

  This is now part of the contrast-gainer effect. We compare these sun-god-like rich men with their special celebrity status to their opponents—mortal, earnest, cheap-suit, government-issue politicians.

  On the one hand, we have rich men who have demonstrably accomplished something—they have gotten amazingly rich. (We no longer think of the very rich as takers, but rather as creators—wealth creators.) On the other hand, we have politicians who, we believe, have clearly accomplished nothing—that they would actually be content not to get rich makes them doubly suspect (they are the takers).

  For lots of people who work in corporate America, a smartly dressed, business-jargon-spouting, occasionally charming, often despotic rich man is much more familiar and comprehensible than a civil servant, with his bureaucratic style, policy-laden conversation, and wonk aesthetic. Of course, there are an enormous number of civil servants working in government warrens who must find the corporate-mogul aesthetic unsettling. These two camps may define the opposing sides of the future.

  Certainly, the former group seems to believe that the skills for building immensely valuable, cutting-edge businesses can be applied much more successfully to the running of government than the skills acquired in a career of working in government.

  He’s a “good manager”—the more money you’ve made, the better manager you are. Notably, people speak of “management” now the way we used to speak of politics. Management is about understanding human nature, having keen people skills, being able to inspire, motivate, manipulate. Management, rather than politics, is the art of the possible.

  It’s reasonable, surely, to ask what’s in it for the rich man. Oddly, we seem to believe the rich want less than the nonrich. That the man who needs the job is less trustworthy and necessarily more of a self-promoting phony (he needs the job, so he’ll say anything) than the man whose whole career has been about selling and amassing and self-benefit.

  Indeed, while the financial-information business is in generally bad shape, there was said to be a $10 billion postelection offer for Bloomberg L.P. from Thomson, a Canadian financial-information concern; the Bloomberg people, however, reportedly let it be known that they thought $20 billion was more in order. Bloomberg, after all, is a pretty fabulous brand name now.

  So this was Surely an issue this audience was attentive to: What had Michael Bloomberg gotten out of all this for himself? Was running for office a valid return-on-investment strategy? How much did it enhance the value of personal and corporate brand?

  Moguls are nothing if not competitive with each other. (Just before the election, Murdoch’s people were confiding that the New York Post wasn’t going to endorse Bloomberg because Rupert didn’t want another media guy to compete with him for mogulissimo status.) If he can buy that, I can buy that, the rich reflexively conclude. There is a whole class of billionaires who have made their money in the last twenty years and who are now at the age when people run for high office. Mort Zuckerman, Donald Trump, and David Geffen obviously come to mind. (Does Trump feel like a chump for not being more serious about his own political plans?) I know a bunch of young technology guys who made out like bandits who could easily drop $100 million on a race—and who have nothing much else going on in their lives. I think we can expect to see them on the hustings soon.

  There is also—although it would go unmentioned at this conference—the Berlusconi factor.

  The nexus of media and government is a vital and powerful one. The Italian mogul and head of state, Berlusconi, had pursued this strategy and articulated this imperative more coarsely and extremely than any other of the world’s media titans. Indeed, as media titans go, Berlusconi may be the world’s most successful precisely because his strategy of media and government has led to the world’s most complete media monopoly—which is, at some not-too-removed distance, what this is all about.

  It is the central question being pursued by everybody here: how to achieve a more complete monopoly.

  You needed government to do that. (Indeed, the next speaker, after Charlie and the mayor, was Michael Powell, son of the secretary of state and chairman of the Federal Communications Commission, the body without whose support media monopolies would not be possible.)

  Now, the general feeling about the Bloomberg crossover, I think, is that it is quixotic, and, even for a media guy, narcissistic—but you couldn’t just write it off. The political sphere, for a media mogul, was a key play. Murdoch was the other most cogent example of mogul as political figure—not only was he a brilliant lobbier and bureaucratic player and influence getter, but he had turned his news network into a fearsome and profound political voice.

  Indeed, if you were anything more than just small-time, you recognized that politics and media had to a greater extent merged—that politics did not exist without media. Therefore, if you were anybody, you wanted to get some benefit from that synergistic and symbiotic relationship.

  You wanted to figure out, if you were here, what the next play was, the next step in how this all worked. Where should you be standing to get the advantage?

  Now, this was not the discussion between Charlie and the mayor. Charlie and the mayor were discussing the budget crisis. The idea was that the media bigwigs would get some insider’s insight into the political future—and knowing more about government would be able to make better business decisions.

  And while that was not without some value, the real focus was on Bloomberg and what he was up to and how he was performing.

  It was not only what advantage he had gained by his strange and unexpected crossover to political office, but something else—something possibly more profound.

  You had to ask yourself: Was he running away from moguldom?

  Had he made billions and positioned himself in the mogul limelight and found it all… unsatisfying? Was politics his escape?

  Did Michael Bloomberg here, on the stage, with Charlie Rose, talking about the fate of a great city, shame everybody else here? Was everyone else here, compared to Michael Bloomberg, just so small-time? If you were in the media business, the Zeitgeist was ultimately your play. It was important to know then, insofar as being a mogul was concerned, if Michael Bloomberg had redefined it.

  One more thing that, I know, everyone was evaluating: How odd was he?

  He is odd,
certainly—a strange, distracted, disconnected, imperial (say in the Franz Joseph style), self-conscious, unglamorous figure. Michael Bloomberg was a heavy dose of reality. So how much did this reflect on other businessmen and moguls? How bad did Michael Bloomberg make all other businessmen and moguls look?

  This was a difficult moment, everyone knew.

  The bursting of the bubble, Enron, AOL Time Warner, Martha Stewart. Oy.

  The PR wolf was at the door.

  Did odd Michael Bloomberg help or hurt the cause?

  What was his role?

  9

  MORE

  MICHAELS

  The other way that conferences make money is through sponsorships. Companies that want to be associated with the conference or want to expose their logos and such to the people who attend the conference will pay high fees for certain VIP privileges, including signage, and bulk tickets, and speaking opportunities.

  For $150,000 the international consulting firm McKinsey & Co. was a sponsor here. For that $150,000, the head of its media practice, a rabid self-promoter annoyingly named Michael Wolf got to interview Michael Powell, the FCC chairman, in the second discussion of the morning.

  Consultants have become very big in the media business not least of all because so many people have gone into the media business who know nothing about the media business and so many media businesses have bought other parts of the media business that have no relation to the specific skill-sets of the businesses that they have heretofore been in that it has been necessary to hire people who say they know what you don’t know (no matter if they in fact know it).

  And so, often, the person hired has been this other Michael Wolf(f). As a gnat feeding on the carcass of the media industry, he’s been, possibly, even more ubiquitous than me.

  Our names and mutual media interest have thoroughly linked us. I get his mail and telephone calls and get asked to make his television appearances. People I don’t know call me in the hopes that I will tell them how they can turn their businesses into media plays. We shoot daggers at each other across the dining room at Michael’s, but people still confuse us. We may, of course, be helping each other—each expanding the other’s brand. Once, when I unraveled the confusion on one television show—that it was not me they wanted but the other Michael Wolf(f)—the producer said I would do anyway. A McKinsey competitor took me to lunch to suggest that I ought to work with them because then we could get some of the business that the other Michael Wolf(f) was getting, which would be fair because he was getting business because people thought he was me.