I would enjoy listening to the late Shelby Foote reading a phone book.
Shelby Foote
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Category Archives: Books
Gus Dies
Larry McMurtry’s Lonesome Dove is one of the best Texas novels of our time. The Pulitzer Prize-winning novel was later made into a wonderful television mini-series, which starred Robert Duvall and Tommy Lee Jones as the iconic former Texas Rangers, Gus McRae and Woodrow Call.
One of the best scenes from the mini-series — and arguably one of the best scenes ever produced for television — is the scene in which Gus dies after being badly injured in an Indian ambush. After searching for his missing friend, Call finds Gus in a doctor’s office after Gus has had one of his gangrene-infected legs amputated. Rather than have his other infected leg amputated, Gus elects to die.
Two old friends — played by brilliant actors at the top of their game — have a final conversation. Television has never been better. Enjoy.
Too Big Even to Consider Failing
As with many folks in the financial and legal world, I’m finishing up Andrew Ross Sorkin’s entertaining new best-seller, Too Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial System—and Themselves (Viking 2009). Clear Thinkers favorite Arnold Kling has the best analysis of the book that I’ve read to date:
Reading the book leads me to ponder the differences between Chauffered America–Hollywood, investment bankers, and high government officials–and Strip Mall America–people who launch businesses like restaurants, hair salons, and other small enterprises. [. . .]
The obvious sociological point is that the top finance people live in a bubble, with secret entrances, isolated offices, chauffered automobiles, and private jets. Even the top government officials inhabit this world. Sorkin describes Geithner arriving at the airport in DC and losing it over not being met by a driver. Forced to take a taxi, Geithner turns to his colleague and says that he has no cash. Perhaps this would have been a moment to teach the head of the New York Fed how to use an ATM. [. . .]
I do not see how reading this book can help but reinforce a Simon Johnson/James Kwak view of Washington captured by Wall Street. Paulson seems to have no use for anyone who is not a Goldman Sachs alumnus. Geithner seems to have no use for anyone who is not a CEO of a large financial institution. Both of them view the collapse of major Wall Street firms as Armageddon.
The “regulatory overhaul” promised by the Obama Administration is still the same-old, same-old. Chauffered America will be restored to its exalted status, with a few new rules and regulations thrown in.
Instead, somebody should be asking the deeper question about Chauffered America. If Chauffered America were to disappear, would the rest of us miss it? Or could Strip Mall America get along just fine without the big-time bankers and their friends in government?
One comes away from the book with the conclusion that the primary purpose of the government and corporate leaders involved in resolving the crisis was to maintain the elitist culture of Wall Street with regard to financial matters, while at all times making sure that the government protected the maximum number of the folks making the bad bets from ever having to endure the true extent of the risk that they took in placing those bets. That’s why things like this happened.
As I noted after the demise of Lehman Brothers last fall, resolving the crisis was not rocket science. Sorkin’s book establishes that the leaders who were calling the shots were never going to let on that such was the case.
Understanding storytelling
When young attorneys ask me how they can become more effective advocates in the courtroom, I usually tell them: "Become better at telling stories."
Several years ago, Derek Sivers interviewed the late Kurt Vonnegut, who was no slouch as a storyteller. Check out Vonnegut’s views on story-telling, which he believed promotes the need for drama in people’s lives.
Essential reading for anyone who seeks to persuade.
Re-tracing Graham Greene’s journey across Mexico
In the first of a series of upcoming blog posts that will interest most Texans, The Atlantic‘s Graeme Wood addresses many of the difficult issues facing Mexico that have been a frequent topic on this blog. Wood is re-tracing the journey across Mexico of Graham Greene of The Lawless Roads fame seventy years ago:
Seventy years ago, Graham Greene crossed the US-Mexican border into a land blighted by violence, unrest, insurgency, and religious and counter-religious mayhem. If he came back today he would find a country riven by other forces, but in some ways just as chaotic, and just as worthy of the title he gave his account of the journey, The Lawless Roads.
The news out of Mexico is all bad. When I was a kid, my parents and I went across the border at Reynosa, Matamoros, and Tijuana to take awkwardly posed photos on the backs of burros, buy cheap Kahlúa, and eat frog-legs at Garcia’s. Now the drug war has re-ignited, the rules of engagement between police and crime syndicates have changed, and the environment has become more savage. The government of Felipe Calderon has challenged the narco-traffickers and has militarized the border. Garcia’s is still open, but tourists have vanished. College kids don’t head down here from South Padre so much, which is a good indicator of the downturn, because they are college students, and that Kahlúa was awfully cheap. There are serious questions of whether Mexico is becoming that scariest of things, a military state in only partial control — i.e., a Latin American Pakistan.
Only some of the drama is on the border. Greene’s trip through Mexico crossed the country on its long axis and reported how Mexicans were dealing with the effects of the Cristero War, its violent suppression of the Catholic church, and the armed discontent that suppression sparked. Over the next cycle of posts, I will steer my rented Mexican Ford (an inglorious chariot that feels like it would crumple like a soda can, if I were to give it a bear-hug) along Greene’s path, with deviations, to see whether that lawlessness is a permanent condition.
Robert D. Novak, R.I.P.
Longtime Washington political columnist and television political pundit Robert D. Novak died yesterday, ending a virtually unparalleled 60-year career of reporting on national politics from the nation’s capitol. David Broder, Jack Shafer. Tim Carney, Stephen Miller, Jeffrey Bell and the WSJ Editors do a good job of putting this formidable career and fascinating man in perspective.
Inasmuch as I was not particularly interested in Novak’s obsessive-style of political reporting in his columns and on television, I didn’t appreciate Novak until late in life. That changed when a friend recommended Novak’s The Prince of Darkness: 50 Years Reporting in Washington (Crown 2007) (prior post here), which I probably would never have read but for my friend’s urging.
Turns out that The Prince of Darkness is a thoroughly enjoyable read, particularly because Novak passes along his reflections on the relationships he had with virtually every major figure in American politics over the past 60 years, which pretty well spans my lifetime. I went from not really being interested in Novak to not being able to put the book down. It remains one of the most unexpectedly delightful books that I’ve read in the past couple of years.
Characters such as Novak are rare these days, and we are not the better for that.
The Waiting Game
Moira Hodgson’s W$J review of waiter/blogger Steve Dublanica’s new book — Waiter Rant: Thanks for the Tip–Confessions of a Cynical Waiter — is a rollicking good time. Check out Hodgson’s analysis of the merits of Dublanica’s background for waiting tables:
Considering some of the customers he has to deal with, Mr. Dublanica’s background was the perfect training for his job: four years in a seminary studying to be a priest followed by work at rehab centers and homes for the mentally retarded. He says that 80% of the people he serves at The Bistro are perfectly nice; the rest are socially maladjusted psychopaths. He also has to contend with servers on drugs and an irritable, jumpy boss: "Like a soldier home from war, his eyes are always scanning the horizon for threats."
By the way, be careful about sending that food back to the kitchen:
The third time a woman sends back her de-caf coffee, saying it’s not hot enough, he dumps regular coffee into her cup, places it in a 400-degree oven, takes it out with a pair of tongs and delivers it to her table. But that story pales beside Mr. Dublanica’s account of a waiter who plays floor hockey in the kitchen with a returned hamburger patty before hosing it off and taking it back to the table.
Bill King’s Story
As Republican presidential nominee John McCain is doing his best to stoke public prejudice against job-creators and wealth builders, longtime Houston lawyer and businessman Bill King is promoting his new book, Saving Face (Somerset 2008), which is King’s personal history of the savings & loan crisis of the late 1980’s and early 1990’s.
Ironically, McCain knows quite a bit about the back story to King’s book.
McCain was one of the Keating Five, the Congressional supporters of former Lincoln Savings & Loan chairman and CEO Charles Keating, who was convicted of various corporate fraud crimes and served four years in prison as a result of highly-stoked but substantively-thin prosecutions that were ultimately overturned on appeal.
Keating eventually pled guilty to a single count of bankruptcy fraud to limit further prison time and insulate a family member from prosecution. For a thorough review of the mendacity of the Keating prosecutions, pick up a copy of Dan Fischel‘s book, Payback: The Conspiracy to Destroy Michael Milken and his Financial Revolution (HarperCollins 1995).
King’s story is the Houston version of Keating’s and a precursor of the prosecutorial abuse that the post-Enron criminal prosecutions in Houston generated a decade later.
Not only does King do an excellent job of explaining the financial, economic, regulatory and political underpinnings of the S&L crisis, he explores how the government wielded its prosecutorial power indiscriminately to serve up scapegoats to a salivating mainstream media and an ill-informed public.
King is thinking about running for Houston mayor in 2009 and, based on the depth and perspective that he exhibits in Saving Face, King would probably be a fine mayor. The following is King’s overview of Saving Face, which I recommend highly:
These days I find myself cringing when I hear media accounts that fraudulent and greedy mortgage brokers are responsible for all of the woes of the current housing bubble and the sub-prime defaults. I do so because the recriminations are an all too familiar echo of an earlier debacle. One to which I had a ring-side seat.
Many of you who have known me for some years know that shortly after law school I made the somewhat less-than-fortuitous career decision of joining a law firm that specialized in representing savings and loans.
At the time it did not seem like a bad decision. The Houston real estate market was enjoying an unprecedented boom and the savings and loan industry had just been deregulated. Investors were clamoring to get into the business.Within a few years of joining the law firm, I began investing in savings and loans and related businesses.
By 1986, notwithstanding that I had started with barely two nickels to rub together after working my way through law school, I had built a small, but respectable, business empire consisting of savings and loan holdings, title companies, and real estate investments.
However, within a couple of years, everything I had built evaporated into thin air.The Houston market collapsed when the price of oil fell from over $34 per barrel in 1984 to $9 the next year. It did not recover to above $20 until 2002.
Manufacturing jobs in the region fell by nearly 50% and for the first time in history Texans’ personal income declined. Bankruptcies in Houston tripled between 1983 and 1987. All but one of Texas’ major banking holding companies failed. Harris County’s population actually declined from 1985 to 1989. It was the first and only time in Houston’s history that it has lost population.
If you did not live through these times, the magnitude of melt down is hard to imagine.It is certainly difficult to lose everything that you have worked for, but the environment that existed in the late 1980s and early 1990s had an even more ominous aspect.
As the public became increasingly aware that the savings and loan crisis was going to take a major taxpayer bailout, there were ever more strident cries to hold someone responsible.
The complexity of confluence of interest rates, regulatory policy, oil prices, the Tax Reform Act of 1986, and the collapse of large portions of the real estate market that actually explained the collapse was too great to be reduced to sound bites. Politicians and bureaucrats began pointing the finger at those in the industry, and soon, the “S&L crook” was born.
And there were enough egregious cases for the politicians and bureaucrats to hold up as “proof” of their argument that the “S&L crooks” caused the crisis. The proposition that fraud and insider abuse had sunk the savings and loan industry was eventually discredited.
In 1993, a National Commission concluded that fraud had caused less than 15% of the total problem. But in the heat of the moment, there was little interest in cool, scholarly reflection on the problems of the industry.
As the 1980s came to a close I watched as many friends, associates and former clients in the S&L industry were swept up in a maelstrom of civil and criminal litigation. Naively, it never occurred to me that I might be caught up in such a dispute as well. But I was.
Eventually, I prevailed in my battle with the regulators, but as you might imagine, it was an experience that left an indelible mark and from which it took me many years to recover.
For some time I have been jotting down notes for a book about these experiences. For a couple of reasons, I recently decided to finalize such a book.
First, as many of you know, I am considering a candidacy for mayor of Houston in 2009. We all know too well that “negative campaigning” has become the standard today. Certainly going bankrupt in the savings and loan business will provide potential opponents ready ammunition. So first and foremost, I want to put the issue squarely on the table.
If I decide to become a candidate, there will undoubtedly be some voters who will be troubled by these experiences. Some will believe difficult times such as the ones I went through are a crucible that better prepares a person for leadership. Most, I expect, will simply want to be advised of the facts so that they can be weighed with other issues bearing on their decision.
But beyond the potential political implications, the troubling similarities between what I saw in the S&L collapse of the 1980s and the sub-prime crisis playing out before us now demands some consideration.
It is a well worn adage, but nonetheless true, that if we do not learn from our history, we are doomed to repeat our mistakes. Perhaps relating what I saw during the saving and loan industry collapse will provide some perspective on the current financial crises.
So for these reasons I have written Saving Face: An Alternative and Personal Account of the Savings and Loan Debacle. I have attempted in the book to tell the story of what I experienced during these times, but at the same time, to place my experiences in a larger, national context. I believe my story has some relevance to anyone experiencing trying times generally, and certainly to those in the Houston real estate industry, many of whom lived through these times as I did.
Nixonland
George Will gives Rick Perlstein, author of Nixonland (Scribner 2008), a history lesson.
Enjoying John Adams
My son Cody and I have been thoroughly enjoying each Sunday night episode of the HBO mini-series John Adams, which is based upon David McCullough’s brilliant biography of Adams. Given the extraordinary talents, troubling contradictions and fascinating relationships among the pivotal leaders of the American revolutionary era — Adams, Washington, Jefferson, Hamilton, Madison, Franklin and Burr, among others — I have always wondered why some enterprising filmmaker hadn’t made a first-rate movie about the era. John Adams producer Tom Hanks should be commended for pulling it off in a splendid manner. Rebecca Cusey’s favorable review of the mini-series is here.
My vote for the book upon which the next movie of this era should be based — Ron Chernow’s Alexander Hamilton (Penguin Press 2004). Two other excellent recent books on this era are Jay Winik’s The Great Upheaval (Harper 2007) and Joseph Ellis’ American Creation: Triumphs and Tragedies at the Founding of the Republic (Knopf 2007).