Customer Reviews

Spoiling for a Fight: The Rise of Eliot Spitzer

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For a book that supposedly focuses on him, Eliot Spitzer for the most part remains a rather obscure character who operates in the background orchestrating a crackdown on various financial institutions engaged in all manner of highly unethical, if not criminal, behavior in the state of New York. It should be a disturbing book. The dishonesty and disrespect for the public evidenced in this book by major financial institutions is appalling.

The reader is supplied with Spitzer basics: wealthy upbringing, the best schools, good grades, etc. Given his background, he should have joined the club - the club that winks at financial shenanigans. But as a true believer in correct behavior, prosecutor, and later attorney general of New York, Spitzer became aware of cheating, collusion, and other assorted misdeeds among financial institutions and set out to do something about it.

The book is more or less a step-by-step account of several cases involving numerous companies, lawyers, analysts, brokers, CEOs, etc. The illegalities are often subtle and much debated, though the intent is always clear: make lots of money at the expense of the other guy. Conflicts are a big part of the author's story, not only with those that the AG's office was hounding, but with the SEC and other regulators. Not trusting the inaction of the SEC through the years, Spitzer's office constantly intruded on the SEC's turf and moved quickly to address the issues. The myriad players and details, some of which are presented better than others, get to be quite a chore to keep straight.

The author seems to assume that the reader will get to know Spitzer through his, or his proxy's, legal actions. But it is difficult to separate out Spitzer from the endless day-to-day detail of the cases. The reader gets snippets of Spitzer: a press conference, a document release, a decision made, etc. Beyond limitations on revealing Spitzer, one may have expected more general commentary and perspective on the questionable corporate actions. How widespread is cheating and collusion? And how much of that is technically legal? And why has there been so little action in regulating this? After all agencies are in place. Is American business really this degenerate?

The details tend to overwhelm the story, both the story of Eliot Spitzer and the greater story of corporate skullduggery. That is why the impact of the book is less than it could be. I'm certain that the only nomination for a Pulitzer prize will come from one of the earlier reviewers, who happens to hail from New York. New York insiders will probably enjoy the book simply to see who got caught, not to mention perhaps some minimal understanding of New York's next governor. It will be interesting to see if Spitzer has any lasting impact on corporate shenanigans and what the next chapter in his life will be.

Like the Bright Girl Ms. Masters no doubt was, and is, she reports every phone call, every e-mail, everything said at every meeting according to every participant. It's thorough but oddly, disappointingly, lifeless. There will be a bounce in the sales of this book what with the recent fall of the Governor amid scandal and disgrace. Alas, those who seek an insight as to how it all could have happened will have to look elsewhere.

This book will intrigue anyone interested in the political process and law.

Masters offers a balanced view of Spitzer's war against wall street. The gist of the book is Spitzer's background and education (rich, ivy league, privilleged) and his ambitious rise to NY Attorney General where he has whipped into shape Wall Street. In doing so, Spitzer has caught the ire of many people who beleive that he is trespassing on sacred SEC and federal government grounds.

Others feel Spitzer is doing the job the SEC SHOULD have been doing. Whether you like him or not, the book offers an interesting perspective into a rising politician and the reaons why he will probably never have a legitimate shot at the White House (hint, its for the same reasons he's been thus far succesful).

So well known are Eliot Spitzer and the corporate visionaries he brought to boot, so widely praised has he been, so robust the expectancy of his gubernatorial future, that any writer about him risks becoming another entrant in a great sack race of redundancy. Brooke Masters's Pulitzer worthy "Spoiling for a Fight: The Rise of Eliot Spitzer", however, is both a journalistic triumph and, socially measured, a public service. Her close description of the facts and settings, rendered in a highly readable style, reflect her Harvard and London School of Economics degrees burnished by sixteen years with the Washington Post.
When in 1999, thirty-nine year old Eliot Spitzer was sworn as New York's 63rd Attorney General, few took into account that he was a True Believer in the progressive tradition of Brandeis and FDR. No one, including himself, foresaw that in an epiphanic moment he would link federalism with the Martin Act's empowerment of him to obtain ex parte injunctive relief upon a complaint that had not yet been answered. So it was that every razzledazzle analyst and fleetfooted broker trudging into 120 Broadway would soon find Spitzer sitting in a prosecutor's heaven, playing for keeps. Here was a steel-willed, politically ambitious warrior who had the street smarts to sense that his own nature and the workings of a random chance might position him to ascend.
Spitzer, transforming what attorney generals do, attacked midwestern power plants for polluting New York, ripped into the Food Emporium and A&P, Gristedes and other major supermarkets and drugstore chains, for mindboggling working conditions of immigrant deliverymen, and convicted the first felonious sweatshop operator in a decade. His unsuccessful attempt to bring gun manufacturers under control proved him a man of initiative, practical, yet moral, quick to learn early the golden lesson of watching one's back even when dealing with one's apparent ally, a lesson he may have occasion to recall when governor. As for righteous anger, when the Red Cross attempted to divert 9/11 funds to its other causes, Spitzer seized it, as it were, by the neck, compelling it to use every cent for 9/11 victims.
Turning towards Wall Street, Spitzer saw hanging fruit ripe for the taking. When Merrill Lynch was taken by Spitzer in the direction of the gallows for bid rigging, its attorney, Robert Morvillo, warned Spitzer that "Merrill Lynch has a lot of powerful friends". In what must have been a surge of concealed, evangelical joy, Spitzer, without warning, thereupon seated Merrill in a kamikaze plane and waved it off the flight deck at 120 Broadway. Merrill was served with a detailed, horrific complaint, while Spitzer, surrounded by a mass of reporters, instantly becoming famous in London, Nairobi, Sydney, and Tel Aviv, rose as Merrill's stock plummeted. Analysts and bankers renewed their Ativan prescriptions as Spitzer sent out subpoenas to Wall Street firms. In media interviews, he thoughtfully refused to rule out filing criminal charges against Merrill. Merrill's one hundred million dollar settlement, its public contrition, and its agreement insulating analysts from banking pressures, was a template in the making. Unless the everyday market has the IQ of an ash tray, everyone got the message.
Invited to speak at the 2002 annual awards dinner for top research analysts, he savaged the 51 stars for their "lackluster performances" and "dishonest advice". Unlike those few guests who understandably stalked out, the public took pleasure in Spitzer's straight forward, plain speaking style. People who have lived long in daunting political hypocrisy fix their hopes for change on persons who speak truth to power.
Gurneys rolled in and out of 120 Broadway, on them, among others, Jack Grubman, covered with his emails, Citigroup, Putnam, Morgan Stanley. The list is long. Calls to Spitzer were received from Good Samaritans, for example, Rudolph Giuliani for Merrill, "Is there a way to talk about this?" (There wasn't.) Condemning the SEC as "lethargic, lazy", Spitzer tied a creative knot in settlements. He demanded internal changes in his corporate targets. Prison, of course, inspired the hesitant. Marsh and McLennon, AIG and ACE, were tripped over bid-rigging, and after Spitzer's filing of a complaint against Marsh, the wounds were indeed deep. Even I, who in property could readily pass for a monk, felt Marsh's pain when forced by Spitzer to forego $800 million annually in contingent commissions decried as unethical by Spitzer. Marsh was compelled to discharge 3,000 employees. It suffered a nearly 40% drop in its stock. As for Spitzer's public attack on AIG and its CEO, Hank Greenberg, Spitzer ethically came very close to the third rail, justifying critical comments by members of the prosecutorial bar. It probably alerted him to his need of moderation when in an attack mode.
Spitzer was to public and press a double feature: John Wayne and James Cagney. For a Wagnerian soundtrack, there was World Com crumbling, its CEO in prison for a 25 year reflective stretch, and Enron perching itself for its freefall. Chance could not have scripted it better. Over it all stood the image of Spitzer paring his nails, wondering perhaps whether Aaron Burr's remedy might save so much time. Knowing, as Justice Owen McGivern once said, "It is always snowing in a banker's heart", the public read with pleasure of Spitzer's $1.4 billion global settlement with investment banks who faced the horror of his detailed Martin Act complaints if they did not agree. It did not warm the hearts of small investors to learn from Spitzer of "spinning", the backscratch giving of shares of hot IPO's to analysts and corporate executives, and the defense of it by investment bankers who pointed to its footnoted disclosure in microscopic print in offerings.
Holding his scalpel to the light, Spitzer turned to mutual funds overcharging middle-class investors. He discovered the exquisites of "market timing" and "late trading". He demanded the independence of fund boards from fund management boards. CEO's here and there had to go, said Spitzer, or a settlement was a no go. After Alliance Capital was caught market timing and punished severely, corporate penitents formed a line outside 120 Broadway. The number of the anxious uncaught must have been phenomenal, to say nothing of the caught hoping to trade them in.
Last, Masters's extensive reportage of Spitzer's attack on NYSE CEO Richard Grasso's alarming retirement claim of $139.5 million, to say nothing of the additional $48 million that Grasso magnanimously waived, is virtually a verbal documentary of that slugfest. It alone is worth the price of reading how, in the view of cynics, insiders on Wall Street play the game in a greed riven culture. Cynics aside, consider, too, the impoverished of our city. Poor in all but pain, upon their hearing of Grasso's claim, as in a story, they must have wondered not about its sum but about who it was who agreed to give it to him. They would indeed be surprised.

The rating is based on my interest in the book. I was looking for all the horrible stories that happened...not his life history. So it is my fault I did not read the summary well before I bought it. If you are interested in Elliot's life story this is an extremely well researched and written book. You couldn't ask for more.

This is a rip roaring account of Elliot Spitzer and his big cases. A very important work and one that sheds light on corporate skullduggery such as Merril's Henry Blodget and others. Spitzer was a hero of the stock market bubble and a household name in New York, sort of the Guliani of the first five years of the Millenium.

Seth J. Frantzman