What makes the wealthy steal?

Within the Thirties, Richard Whitney was one of the vital revered figures on Wall Road. A four-time president of the New York Inventory Change, Whitney had received fame in 1929 when, with the backing of main bankers, his ostentatious shopping for quickly halted frantic promoting on the buying and selling ground.

A decade later, his status lay in tatters. By 1938, it emerged that Whitney had coated big losses in his personal portfolio by embezzling from others, together with the New York Yacht Membership, which he served as treasurer, and his father-in-law’s property. To many individuals, he turned a logo of the rot they perceived on the core of American finance, and he served greater than three years in Sing Sing for his crimes.

Whitney was the last word patrician. How might an individual with all his benefits do such a factor? That’s the query on the coronary heart of The Embezzler, a brilliantly fictionalized model of Whitney’s story by that indefatigable chronicler of New York’s bygone WASP aristocracy, Louis Auchincloss. An lawyer, Auchincloss in some way additionally discovered time to jot down almost 70 books, most of them novels. He was a virtuoso storyteller and good psychologist who put cash and morals on the heart of a lot of his works.

His ordinary milieu needs to be of curiosity to anybody in a management place, as a result of hardly anybody since Shakespeare has accomplished a simpler job of anatomizing a society’s higher crust — a job by which Auchincloss was solely following within the footsteps of Sophocles, Tolstoy, and lots of different greats. At this time’s enterprise world is dominated by a brand new type of elite, and it may be illuminating to look at the methods by which outdated and new evaluate.

The Embezzler, first revealed in 1966, is a cautionary story, as a result of in enterprise, failure is at all times an possibility. What issues is how you fail. Have you ever accomplished so truthfully and even usefully? Had been your actions ethical in addition to authorized? And may you bounce again?

In enterprise, failure is at all times an possibility. What issues is how you fail.

Auchincloss is simply the person to deliver these points dramatically to life, in a novel that’s at instances shockingly good, isn’t unhealthy, and is at all times compulsively readable. A lifelong misfit born into the higher crust, Auchincloss was bullied and abused at Groton, dropped out of Yale, and spent most of his profession as a trusts and estates lawyer, a task that saved him perennially immersed in issues of household and wealth whereas leaving him time and vitality to jot down. Better of all, he understood his tribe but nursed few illusions about it.

The Embezzler is a narrative informed in Rashomon model by its three main characters: the stockbroker Man Prime, his banker buddy Rex Geer, and the girl they each love at numerous instances, Man’s spouse, Angelica. Auchincloss doesn’t distinguish the voices of the three people terribly effectively, however they have been, in spite of everything, merchandise of the identical social and academic milieu. And they’re all keenly insightful. In his virtuoso narrative, the account of every character enhances, contradicts, and clarifies — typically shockingly — what has come earlier than.

Within the first of the three “memoirs” that make up the ebook, Man remembers his time as a well-liked Harvard scholar decided to make a buddy of the troublesome and distant Rex Geer, one among eight kids of a Vermont Congregationalist minister, who struggles to earn the cash to remain in class. Rex is preparing to surrender. However Man, by utilizing his items of excessive delivery, attractiveness, and charisma, intercedes with a professor to study that Rex will quickly win a profitable prize for an economics paper, enabling him to stay in class.

Their friendship cemented, Man lands each of them jobs on the venerable New York banking home of de Grasse Brothers. However Rex, the extra cautious and industrious of the 2, is the extra pure banker, whereas Man is quickly established together with his personal brokerage, one which ultimately handles transactions for de Grasse. Rex and his financial institution climate the crash of 1929 (and the following Melancholy) effectively sufficient. However Man secretly struggles, and to cowl occasional borrowing he falls into the behavior of pledging different folks’s securities as collateral.

Ultimately, Man encounters an ideal storm of setbacks. “Silly traders at all times blame their failure on unhealthy luck,” he acknowledges. “However I ponder if even the wisest watcher of the market might have foreseen the hurricane that wrecked my Caribbean resort island, the patent go well with that delayed the manufacturing of my Vita-Glass homes, the title flaw that paralyzed my phosphate mines, the federal investigation that slandered my tranquilizer tablets. If solely one among these tasks had been realized in 1936, my troubles would have been over.”

In his model of occasions, Man means that his more and more reckless transgressions are impressed by his anger at Rex and Angelica. Studying between the strains, we sense the useless and imperious determine he has turn into — one stuffed with self-loathing and maybe even liable to violence. The phantasm of Man’s frankness is additional undermined by Rex’s account, which nonetheless confirms his personal morally compromised place.

Issues look extra totally different nonetheless when Angelica weighs in together with her personal devastating model of how these three lives intersected. Auchincloss, not like many male novelists of his technology, was good at depicting ladies, particularly Angelica’s genteelly Machiavellian mom. I received’t spoil the enjoyable by saying extra, besides to guarantee you that after you’ve gained everybody’s perspective, your understanding can be significantly enriched, even when your certainty concerning the true nature of the gamers can be shaken.

About Man, after all, there’s far much less ethical ambiguity, for he has destroyed his wealth, his good identify, and his freedom — to say nothing of the happiness and safety of his household. Even discounting for his ordinary self-importance, it’s clear he understands the ramifications: “Man Prime was an establishment on which a small multitude of individuals depended: my outdated father, who lived, at nearly ninety, like Anchises, on the imaginative and prescient of my glory, my companions and workers, my kids and servants, even to some extent Rex himself and his sacred de Grasse companions.”

Man’s defalcations, like Whitney’s, assist result in highly effective new federal securities regulation of the sort his colleagues loathed and feared. (Though Auchincloss has mentioned his ebook was impressed by Richard Whitney, it’s onerous to think about he wasn’t additionally influenced by Thomas Lawson’s Friday, the Thirteenth, one other novel of two Harvard mates, one born into cash and the opposite decided to make some, whose Wall Road fates diverge.)

The Embezzler is stuffed with references to classical Greece, and these appear to recommend the writer’s view of why somebody like Man Prime — or Richard Whitney — would do issues so silly and mistaken and self-destructive. The primary cause, Auchincloss appears to suggest, is character. Man’s is patently poor, and that poses grave dangers to everybody in his life. Now we have just lately seen, on a a lot grander stage, how explosively energy and unhealthy character can mix.

Man, furthermore, isn’t just insecure and entitled — he’s additionally enabled by membership in a robust caste. Standing and wealth can impart a harmful sense of impunity, a way that had as soon as mirrored, for enterprise leaders, some actual insulation from penalties. That made it too straightforward, maybe, to go too far. At this time, as a substitute of having fun with immunity, executives should take care to stay scrupulously past reproach. It’s clear from The Embezzler that failure is an possibility always, irrespective of who you’re. The problem is constructing resilience into your life, so that you simply received’t be tempted to do the sorts of issues — born of desperation, delusion, or entitlement — that flip garden-variety setbacks into outright catastrophes.