I shall return next week.
I’m the kind that moves too fast. But two brilliant strokes of urban planning slow even me down. The first is the Hudson River Greenway, running from Dyckman Street north of The George Washington Bridge down to the Battery. The other is the High Line. I have spent many a profitable afternoon linking them together. Today, I shall consider the former.
I’ve never been on the East River Greenway, so you will forgive me my West Side ethnocentrism. I’m sure it’s lovely, but it’s a shlep across town and the Hudson is just two blocks from my building. Someone on the East Side can write their own paean.
The Greenway (and the High Line) are urban planning at its finest. When I was growing up, the west side of the West Side Highway was all piers and industrial ruins, and virtually inaccessible unless you were a stevedore, a construction worker, or driving in to board a cruise ship. One of my earliest memories of the piers is when I wide-eyed boarded a now-forgotten ocean liner to see my grandparents before they departed on a now-forgotten cruise back in the days when security was – well, non-existent — so you could do things like sit in a stateroom and eat fruit from a basket for a few hours before wishing loved ones a bon voyage. Now it is an easily accessed stroll, punctuated by wonderful walks out onto the river on piers re-envisioned as parks and recreation.
The Greenway is essentially a bikepath. Now, I must admit that, as a general proposition, I don’t much like bikers. Hells’ Angels are fine — you know just who they are. I mean bicyclers, the kinds with lycra bodysuits. Wherever they congregate, whether in duos or trios or feral packs, they clog the middle of roads so we more sedentary drivers can’t get through. And, while I’ve never really talked with a biker about it, they project – or I suppose I sense – from them the emanation of an extraordinary tribal arrogance . Of course I deliberately project the same arrogance as a runner about slow-moving pedestrians. Heck, I feel the same way as a walker about slow moving pedestrians. But that’s me. So be it.
Anyway, the Greenway is essentially a bikepath, but a reasonably careful pedestrian can navigate just fine, accepting the occasional woosh of a passing Schwinn or Citibike. And there are plenty of places where pedestrian walks give you shelter. So I walk. It’s the best way to see the sights.
I access the Greenway at 56th St. hard by the Sanitation Department building, because it is the easiest access point near me. I apologize to those of you who live uptown — I know I’m leaving out half the park — but I spent several happy years living off Riverside Drive (the Greenway further down is more of a novelty), and I’m not going to comment on that Trump abomination. Anyway, past the garbage trucks and, almost immediately, I’m at the remaining working piers, the ones that berth the great ocean liners, the ferries, and diversions like the Intrepid, the Circle Line and World Yacht cruises. I remember a dinner cruise my firm sponsored when I was a young associate. It might have been on World Yacht. I remember becoming violently ill. Not entirely because I drank too much.
The piers run from about 53rd vaguely down to about 41st, where World Yacht is.
It’s fun when the liners are in. Several weeks ago, a boon companion and I were walking down the river and were hard upon the Carnival something-or-other and Norwegian Line’s garishly painted Norwegian Breakaway, ships the likes of which I shall not board after reading David Foster Wallace’s brilliant essay, A Supposedly Fun Thing I’ll Never Do Again. (Do yourself a favor and read it.) My friend looked up and marveled that it was as if an entire block of Manhattan had been lifted and put on the water. And so it was. Our circumambulation was hampered a bit by the fact that one of the ships had, evidently soon before our arrival, discharged passengers, and clumps of them were standing sunburned around, waiting for cabs or shuttles and looking more than a little unhappy for people who had just experienced a luxury week at sea. Only the next day did I read that the Breakaway had had steering and propulsion problems in the Hudson only that morning, delaying landing for several hours, and that the passengers had reacted rather badly. Well, rather like the Donner party. The only way I can understand real crankiness under those circumstances is if the Lido Deck buffet had been closed. The Donner comparison isn’t fanciful.
Some days — well, perhaps most days — there’s a pretty strong wind off the river and, depending on which way it blows, your walk can be fairly strenuous, or reasonably light. If you’re walking back, you’ll have both experiences. But I enjoy the wind, within reason. It’s cooling and refreshing, and a brisk reminder that the Atlantic is only a few miles away. Hence the ships.
I remarked to my companion that the Intrepid looked a bit small after the cruise ships. “It’s big enough to land airplanes,” he drolly responded. And so it is. When I was looking for housing, I was shown a Hell’s Kitchen apartment with a river view — right over the flight deck of the Intrepid. Cool enough for the moment, but I wasn’t keen about living on a naval base. I suspect the accommodations are sparser than on the boats a few blocks up, but it’s quite a fearsome sight.
By the time you get to Pier 84, you can get a burger, go out rowing, or build a boat. Or simply enjoy a short walk on a long pier, landscaped and lovely. By the time you get to Pier 79, site of the air vent for the Lincoln Tunnel – New York’s version of a grain silo – you have been reconfronted by the craziness of New York, as the massive Hudson Yards construction project stretches and bellows across the highway. Get used to it, because you’ll be dropped right back at the edge of it when you come down off the High Line.
I should mention that, when you walk out along the piers, you begin to have fabulous views of the Statue of Liberty (from a perspective that makes unavoidable the realization that, by rights, she should be part of Jersey City). Jersey girl or not, it’s hard not to be moved. At least I am, every time I see her, and the sight is so connected in my mind with Emma Lazarus’s poem that I always have to stop in deep respect both for this country and for my forebearers and everybody else’s forebearers who came through this harbor.
By this time, you’re getting close to the Chelsea Piers. The piers themselves aren’t much to look at, although you approach from the north through a nice park (and there are public restrooms, upon which I rely). But inside their corrugated walls of robin’s egg blue are entertainments, recreations, and sport enough for a Roman circus. The Greenway begins to become more family-oriented , as the frequency of parks and benches increases, the West Village beckons, and traffic diminishes, at least by a little. For me at this point, the great sight is the old Erie Lackawanna terminal, across the river in Hoboken.
The Erie Lackawanna terminal, renovated and in use by commuter trains and ferries, is a fantastic structure, especially if you, like me, are a railroad history buff. Built in 1907 by McKim, Mead, and White, it dominates the Jersey waterfront, clock tower rising high, before the cluster of mini-skyscrapers to the south that now define Jersey City. The Erie — “the Scarlett Woman of Wall Street” — was known in its time more for the blatant stock frauds and depredations of owners Daniel Drew (who gave us the term, “watered stock”), Jay Gould, Jim Fiske, and “Commodore” Cornelius Vanderbilt, than it was for transportation services. By the time the terminal was constructed, much of that was in the past. But the Erie remained a legend, and nothing becomes a legend like a great terminal. It almost makes you want to cross the river.
A few minutes steeped in the early 20th century, and then downward. The air vents of the Holland Tunnel beckon, with Canal Street and some great dim sum to the east. But first the Village, and the Meatpacking District. It is here that you board the High Line, and here that I will end for today.
I don’t believe that I have ever been anyplace more elegant than the Metropolitan Opera House. My affection for the place is compounded by music and memory. I watched, as a teenager, my hero, Leonard Bernstein, lead the New York premier of his Mass there, that riotous and vaguely blasphemous composition that perplexed Rose Kennedy at its world premier upon the opening of the Kennedy Center. I recall some years later Klaus Tennstedt conducting Fidlelio, a performance that left me breathless despite the ridiculous dialogue that made me sorry I spoke German. Or the fireworks of Fabio Luisi’s Don Giovanni just a few years back.
The Met is far more than the music. It is experience. And it is experience grounded in time and place, the timelessness of which still overwhelms first time visitors. Now that I am blessed to live around the corner from the Met, I have enjoyed exploring the theater itself, almost as much as attending performances.
The Met opened in 1966, just two years after the great 1964 New York World’s Fair, about which much has been written lately on its 50th anniversary. While no more than about 10 miles separates Lincoln Center from Flushing Meadows, the two could not have been farther apart. The World’s Fair was to be the future. As many have observed, that future was the present. The Met was the future, the future that had been becoming since Paris in the 1880s. The Met freezes in time a very particular mid-’60s elegance, an innocent sophistication that was to be forever destroyed just a few years later by protestation, assassination, recession, and resignation. It was the elegance of the end of the post-war recovery. The elegance of Audrey Hepburn and cheese fondue. The elegance of trans-continental flight, increasingly affordable to all, but for which one still dressed. It was the culmination of modernism, and really the very end of the modernist movement, captured in the mass-marketing of Corbusier-style furniture, Bauhaus buildings, and Ben Shahn lithographs. At its very best, it was modernism for the masses. And it is perfectly preserved at the Met.
One enters and is embraced by the magnificent upsweep of the biomorphically curving, cantilevered central stairway, pure in its whiteness against the muted crimson of the carpeting. It is as if you were at the very gates of heaven, beckoned upward. Overhead are explosions of ice from crystalline cores, suspended by improbably thin lines. The clarity and brilliance of the light dazzles. These are the famous chandeliers that are repeated inside the auditorium. Now that I attend the opera more frequently than when I lived out-of-town, I have become an habitué of the cheap seats. And one of the wonderful advantages of the cheap seats is that you get to see those crystals dim as the performance begins. Starting with intensely brilliant ice, they ever so slowly burnish to orange, lingering for a moment as deeply glowing red embers before their final extinquishment. For the light show alone, the Met is worth the price of admission.
I mentioned the deep crimson of the carpets and upholstery. Not brilliant, but burnished. Burnished like the brass of the stair rails, burnished like the deep subtle gold of the great curtain, burnished like the ever-so-slightly faded gold paint of the proscenium arch and ceiling. All set off by the richest, darkest of woods, wood that forms most of the walls inside the great theater.
The Metropolitan Opera House is just that elegant. I think of it as Holly Golightly said of Tiffany’s: “nothing very bad could happen to you there.” But it has also kept pace with the times. That is evident in the audience.
The audience at the Met fascinates, and gives great hope for the future of opera. There was a time when the opera was as much event as performance, and people dressed accordingly. Many still do. For much of the audience, suits for men and lovely dresses for women are the order of the day. Even I feel the pull. While I am perfectly comfortable in Avery Fisher Hall wearing slacks and a shirt, I would never go into the Met without a jacket and dress shirt. And usually a tie. But, as is the way of progress and modernity, times have changed. Tweedy men, and women with fanny packs, are almost as common as the well-dressed. I watched with amusement turning to admiration a few weeks ago as I gazed down upon the Grand Tier Restaurant and saw a gentleman in a New York Islanders jersey and jeans enjoy his dinner, replete with a bottle of wine. The occasional cross-dresser (c’mon, this is the opera after all), and serious young men and women in their finest clothes.
In fact, these are two aspects of the Met that are delightful. When I lived in Our Nation’s Capital and attended the Washington Opera I was, almost invariably, one of the youngest members of the audience. And I am far from young. One sees, at the Met, many younger people, so many that it is hardly remarkable. That is great promise for the future of opera. And, almost uniformly, the younger people dress as people always have dressed to attend the opera. Whatever casual Friday or Wednesday or Monday they observe at work, the opera commands their respect. And, to my eye, the space demands it. After all, the audience is part of the scenery, and with scenery so elegant, elegance is commanded.
While I abjure $15 for a glass of poor Scotch or wine, the quality of space and abundance of bars turns intermission into a cocktail party, at least if you are accustomed to cocktail parties with long lines to the rest rooms. And intermission is part of the elegance of the Met. Intermissions at the Met are leisurely affairs, designed as much to allow you to absorb the act just ended and prepare for the one to come as to allow for set changes and a break for the singers. Intermission allows you to look out the monumental windows, past the backs of the great Chagall murals, into the Lincoln Center night and the brilliance of the fountain. It allows you to look over the the beautiful stone terrace of the Mercedes Bass Grand Tier, or even wander out into the cool evening, backlit by the lantern that is the Met at night.
There are structures that capture a moment. There are structures that reflect a civilization. There are structures that tell tales. The Metropolitan Opera House is all of these. And in all of these, it is timeless. May it ever stand.
Who could resist? Screaming across a row of windows at street level of the Time Warner Center was the plaintive cry, “Equinox Made Me Do It.” Gleaming beneath the words were depicted the sweat-soaked bodies of beautiful young men and women, laughing companionably as they engaged in some ambiguous form of exercise, their arms flung up as if at a ‘90s dance party, their muscles fairly bulging with a restraint that suggested a touch of class. If advertising is meant to put you in the picture, I was there.
Who was I kidding? I’m 57, possess a lovely Talmudic pallor which, in my case, resembles the underbelly of a dead fish, and, while not overweight, I could hardly be described as buff. I have always maintained an exercise regimen (that sounds more serious than it really is), but laughing and smiling are not part of it. More like coughing and spitting. Sweat dripping down my body is not pretty. For me, it’s just another way to pee. But look at those people. If I joined Equinox, I could be with them. I could be like them. Susceptible as anybody (and perhaps more susceptible than most) to what behavioralists call overconfidence bias, I went in and signed up.
Perhaps I should have looked more closely at the website, at the picture of another sweating, fit man, who appeared to be running but with what looked like a plastic gas mask strapped to his face. That might have told me something of what I was in for. Somehow I missed its significance.
You see, I do work out. And I am reasonably fit. But I’m also a bit on the competitive side. And, as I think I might have mentioned, I’m not 25. Or even 35. Or 45. Or 55. Had I joined the local Y or JCC, and been cast perhaps among more of my contemporaries in more varied states of physical unconditioning, all might have been well. That was not my lot. And, as it turns out, that gas mask would have been helpful for an infusion of oxygen. Or for the anesthesia I craved the next day.
But I’m getting ahead of myself. More of the club. As the ad so clearly insinuates, Equinox is not just a gym. Equinox is what, in the ’60s, used to be called a happening. The” recycled cork wall,” the “custom artwork from a local artist,” the juice bar – on which more – and the “ultra-exclusive executive amenities” (which, it turns out, include the gas mask) — let you know that you are not in any quotidian gym. Nope. You are in a panoramic fitness experience.
Even the location of the gym itself bespeaks legend. As my young, wide-eyed real estate broker told me in hushed tones when he showed me the apartment that was to be my home just a few short blocks away, “that’s the Equinox. That’s where the celebrities go.” While I averred my non-celebrity but suggested that I might join anyway, he laughed and said: “That gym is the expensive one. It’s like $12,000 a year to join.” He knew what I was spending on rent. It wasn’t in the cards. It turns out that my gym isn’t any more expensive than any other gym. But when did reality ever complicate legend? And, while I tend to be oblivious to celebrity, I have yet to make a sighting. It’s not that they’re not there. I’m just saying.
But that is not why I joined. There is a perfectly good gym in my building. Nope, I joined for two reasons. One was because I knew that I would treat the building gym as an extension of my own home and never get off my butt to go downstairs. Who knows, I might even have hung my underwear to dry on the machines. I liked my chances better by committing to a more elaborate membership. By which I mean one for which I had to leave the building. And one for which I had to pay.
The second reason was the shvitz. A shvitz is derived from the Yiddish word, “shvitz.” Shvitz means sweat. A shvitz is just that. A place where you sweat. Those of you who are faynshmeckers probably know it as a steam room. Not to be confused with a sauna.
Now, the concept of a steam room, as old at least as the ancient Romans, is pretty interesting. It’s a place where you go, of your own volition, to endure extreme discomfort for the simple pleasure of ending the discomfort when you stop. Come to think of it, it’s kind of like yoga, but at least in the shvitz you get to sit, or, even better, lie down, if there aren’t that many people there. (Which brings to mind Winston Churchill’s wisdom on physical exertion: “Why stand when you can sit?”) But, at my gym at least, there are always a lot of people in the shivtz. If you time it right, the shivtz at my gym resembles the number one uptown train at 6 pm in August. One time it was so crowded that I feared my neighbors’ tattoos would transfer onto my arms. But I like the schvitz. So I joined.
My gym is underground. No big deal at all. After all, this is New York, real estate is expensive, the fancy location of my gym is really expensive, and nobody actually needs windows to be able to lift weights. Even better, nobody can look in and see you lifting weights. Besides, there are plenty of tvs. If you really want to see the outdoors, you can turn to the Discovery Channel and find a locale more exotic than Columbus Circle. Or do something crazy, like run across the street in Central Park. In fact, there is a kind of serenity to the underground location of my gym. That is, until you start to exercise.
You get to the gym proper through a small elevator lobby. I have to admit that I find the idea of taking an elevator to work out amusing, but hey, I once belonged to a gym where I drove the three blocks from my house and back every day, so who am I to talk? But before you get to the elevators, you confront the juice bar. I’m not sure what juice has to do with exercise, but there it is. Walking in the front door, you are smacked in the nose with an herbiferous, slightly grassy, slightly cucumber aroma, emanating from the counter at the back of the room. Now, it’s probably obvious that I’m not much of a juice guy, and I haven’t spent a lot of time trying to figure out the bar’s offerings, but I am confused. There seems to be a variety of combinations of things that don’t normally go together (except, perhaps, at Per Se just a few floors above), like cucumber orange buckwheat mango quinoa strawberry slush. (By the time I finished reading that, the elevator had been up and down three times.) And each one has a short paragraph describing its supposed health benefits, as well as the obligatory New York calorie count. As a professional anorexic, I have glanced at the calorie counts. You have to work out just to be able to drink the juice. I haven’t stopped to study the recipes in depth, or I’d never get to the gym, which has perfectly good water fountains.
The lobby is lovely, and you are greeted by name as the desk attendants scan your barcode. You walk past a few glass-fronted offices, a small boutique, and then, there you are. Literally hundreds of machines of every type, from the crosstrainers and treadmills to weight machines, barbells, dumbbells, kettle bells, jingle bells, tinker bells, and the ominously medieval-looking equipment used in Pilates. It is a New York gym. The space is used efficiently, so there isn’t much elbow room. And it is a New York gym. Which means that one constantly is trying to sidestep sweaty people texting and walking through the narrow passages without any evident clue as to where they are going. But a few moments of this, and you are in the locker room.
That is where I began to have my doubts. That beckoning ad meant it. These people weren’t pictures. They had muscles in places where I haven’t seen my muscles in. . . well, where I’ve never seen my muscles. I began to become just a bit shy about taking off my clothes. Trying not to stare, I found a vacant locker and, eyes wide shut, changed into my workout clothes, finally slipping on the running shoes I had purchased only that day. Who was I kidding? I hadn’t run in, what, ten years? But I needed to get in shape, and it seemed like a good idea at the time.
Again, looking straight ahead, I forged out of the locker room and to the treadmills. I don’t know the last time you were on a treadmill. But as soon as I stepped onto one, I realized I was in trouble. You have to be a software engineer to operate one of those things. Recognizing that running on a treadmill is as interesting as watching paint dry, and considerably more painful, I had snatched an old pair of earphones from home before coming over. I was relieved to find a place to plug them in. But I got no sound. I hit a button on the touchpad on the screen before me. No sound. I hit another likely looking button on the screen before me. No sound. I hit every button on the touchpad on the screen before me. The treadmill started to move. Faster. And faster.
There I was. I couldn’t reach the buttons because the treadmill was drawing me back. I had to run like a lunatic just to keep from flying off backwards. And so, earphones dangling off to the side, I ran. And ran. And ran. All the while, trying to figure out how to turn the damn thing off. No luck. One mile. Two miles. Three miles. I was really starting to shvitz.
Did I mention I am competitive? That spirit overcame me. I forgot that I hadn’t run in a decade. I forgot that I am 57 years old. I paid no attention to the alarming speed at which the rubber floor beneath me was rotating. I was going to look like the guys in the locker room. Today. Or die trying.
Before I knew it, I had run five miles. Six miles. On one hand, it was kind of exhilarating. On the other, I was afraid I was going to die. Sensing an immanent heart attack, I hit the red button at the front of the screen. And promptly landed on my butt.
This is a New York gym. Nobody seemed to notice. Or care. For which I was grateful. But now I had to stand up. After six relatively fast miles, my legs were a bit on the rubbery side. I rose. And steadied myself against the machine. Looking around, in the hope that maybe somebody had admiringly seen the old guy run (but not fall), I began to walk toward the locker room. It was then that Churchill’s wisdom was brought home. I sat.
I’ll spare you the details of going the distance to the locker room, the dubious delights of the shvitz, and my evening ablutions, other than to note that I don’t have such fancy bath products at home. I will admit that, arising during the night, my legs promptly buckled, suggesting perhaps that I had been a bit too aggressive.
Equinox made me do it. I’m going back today.
I apologize to those of you who regularly grace me with the illusion that my thoughts matter by reading this blog. I haven’t written in the past couple of days because, well, frankly, I’ve been a bit weary. But I’ve been thinking about things that really matter in my life (that Barbara Carroll set remains with me). One of my transformative experiences was my getting to know China. I first went, relatively late, in 2007, to speak at a conference, but then returned in 2010 to teach in Beijing, at my Chinese home, Peking University (Beida). My son, Alex, accompanied me for part of the summer. As we wandered (including a wild trip to the Shanghai Expo), I kept a bit of a travelogue. Here it is. It’s much longer than my usual posts, but — rereading it today –I think it expresses my thoughts as well as it did then.
From the Rockin’ Republic of the People
So, still very cloudy, although the rain has stopped, but also still humid. I was up at 5 again, studying Mandarin (to what avail?) and Alex rose late after watching Spain beat the Netherlands in the World Cup. We went to old Shanghai. Wild. Architecturally very different from the controlled classicism of Imperial Beijing, but quite beautiful and very, very Chinese. The streets are out of control, in a surprisingly controlled way. Imagine a combination of the souk in the Moslem quarter of Jerusalem, with streets almost that narrow, but with constant car and motorcycle and bike traffic that literally doesn’t care if it wipes you out, with downtown Manhattan’s Chinatown (with shops at best at quarter scale), seemingly millions of your best friends wandering around, and a deafening roar, including people accosting you every three minutes to sell “antiques,” and “genuine” fancy watches, all reminiscent of old photos of the Lower East Side when it was ours if we had been Chinese. It’s awesome fun, and a stunning display of humanity.
To escape, we went to one of the finest classical Chinese gardens (and residences) in the country, over two acres, walled off from the hoopla. Absolutely magnificent, middle Qing Dynasty (about 1750), quiet, reflective, and brilliantly done. Twenty years just to do the landscaping. Then to shop. Retail is an unknown concept in Shanghai, even at mall stores (I had to go to a mall upon arrival on Saturday because I needed the shirts I forgot to pack in Beijing, leaving me to look like a Chinese teenager in order to keep the cost down). In a simple negotiation, conducted through smiles, frowns, and calculator, I bought a pink silk dress and slippers for Ba. Started at 400 RMB. I countered at 70. Bought at 100 and overpaid at that! It’s so much fun. If you want something, and they want to sell (and they all do), you will buy it at a price that will make you happy.
Dinner last night — 7 courses (Alex worked hard). Wonderful. Lunch today at an incredible dumpling place in old Shanghai. (Oh, and by the way, you know the restaurants are good because all the customers are Chinese!) Dinner tonight with a classmate of Deng’s (a friend at Beida), who it turns out did a Fulbright 3 years ago with us at GW Law. Small world.
It continues to amaze me that nobody speaks English. On the other hand, if you lived here, why would you care? After all, this is the Middle Kingdom, and they know it.
Tomorrow we have a guide to take us to the ancient silk city of Suzhou (more for my daughter) and the canal town of Zhouzhang. (Did you know China had a grand canal from Shanghai to Beijing)? Then off to the ultimate Chinese craziness of Expo on Wednesday. Alex is lying on the bed watching French cartoons on Chinese tv. Some world.
Exhaustedly, but feeling among my people (honestly, if I were 25 years younger. . . .)
OK. So. Contemplate leaving a city of 20 million people, with all of the modernity of any city in the world, driving about 30 miles out of town, and seeing barefoot men and women working the rice paddies by hand. Amazing. And, in its own way, quite beautiful (as is the countryside). Suzhou, the city Marco Polo (himself no stranger to canals) called the Venice of the East. And the Grand Canal (from Shanghai to Beijing) was built almost 2,000 years ago and dwarfs the Erie and C&O).
Suzhou itself is a 2,300 year old city, with buildings standing before the west was born, surrounded by a modern city bigger than Philadelphia. Green, magnificent, genius in its fortifications. And, like everything the Chinese do, even the most rudimentary military defenses are done with grace and beauty. The ancient gardens, mostly Ming dynasty (contrasted with the later Qing dynasty gardens of Shanghai), and which are really elaborate residences with multiple outbuildings (no, not that kind), ponds, waterfalls and stone gardens, grottos, plantings, etc., are pure magnificence and built for the serenity one still feels inside their walls. Suzhou also boasts the top silk cultivation, and at the first Chinese silk factory we saw every step of the process, from live silkworms to finished product. Amazing, although the technology is little changed, and I can now easily understand the difference between top quality and lesser silk (as will Dalia, Ba, and Alex, when they sleep in their new silk bedding, and Ba when she puts on the magnificent princess’s dress I bought her). Needless to say, the factory tour ended in a huge sales outlet, but what the heck, you see the quality as its being made, and the prices, while not cheap, are waaaay less than home. We did refrain from buying the pillows filled with silkworm dung that are said to be good for your health.
So then, after the first bad Chinese food I’ve had in China (what do you expect from a tourist restaurant?), we drove to Zhouzhang, one of the famous “water cities”of China, through farms, lakes, and paddies. Beautiful villas beside humble farms, some with nothing more than a rice paddy as a modest back yard. Zhouzhang, also an ancient city and even more Venetian than Suzhou, is magnificent too, although since the “rediscovery” of the city 30 years ago it is, like Venice, lined with shops trying to take your money. (Think of the Rialto and extrapolate it to a town.) Yes, of course we gave them some. After all, they’re entitled to make a living, and they sell nice stuff (alongside the drek. I hope Dalia likes the black freshwater pearls from the adjacent lake). Anyway, it was great. I’ll email some photos after we finish downloading the almost 400 Alex has already taken, many of which are very good (including his photographs of almost every dish of food he’s eaten)! And yes, I know there’s a lot of trayf, but the food is irresistibly wonderful, as is the tea. And the Mao Tai – I don’t know what the proof is but I can’t count that high.
It was nice to be in the countryside after the constant din of Chinese cities, and good preparation for what I expect to be the complete madness of Expo tomorrow. And tonight to a good Cantonese place to cleanse the palate from lunch (and Pop, I hate to disappoint you, but they listen to the government. I’ve literally seen no spitting in the streets since I arrived in the country, although three years ago you could slide down the street on it. Yes, gross, but I lack the elegance of the Chinese). I shall now join Alex in laughing at over-the-top Chinese tv.
The Dao of Expo
Fact: Attendance yesterday was about 500K. I have no reason to believe it was less today. That means the entire population of DC or San Francisco waiting to enter pavilions with exhibition space of no more than about 2 square miles, if that. And remember, it’s the rainy season. Cloudy all day, with occasional heavy showers. Nobody cared, not even if they poked your eye out with their umbrella.
Also, for the few of you, who, like me, remember the 1964 New York World’s Fair, the Belgian Pavilion continues to sell Belgian waffles. We didn’t get them, although I think Alex was a bit disappointed.
Now, here’s how it’s done:
You arrive before the 9 am opening time (of course with advance purchase tickets), and find yourself on a line that will take about 45 minutes to get through. Not terrible – because there are like a hundred stalls at each entry gate! By the time you enter and find a pavilion you like (ok, maybe for the most indecisive traveling pair in the world, it takes more time than for most), the wait to get in is an hour or two, although not a single sign gives you an approximate waiting time – you just figure it out. By the time Alex decided on Japan and we saw the line, we realized we would be in Tokyo far faster than we would be in the pavilion. So you choose a pavilion you expect to be less popular with the Chinese, say, for example, the Israeli Pavilion (which you also go to out of loyalty in the expectation that in the current world political environment, nobody else will go). You’re mistaken. You wait precisely (because you time it while checking your email because what else can you do?), 70 minutes. At the entrance, you exchange pleasantries in pidgin Hebrew with the attendants who are very nice. You are told by the young Sabra who looks like Alex (curly hair, beard, etc.): “What kind of a Jew are you for waiting? There’s a VIP entrance for Jews and Israelis.” Oy! I know my grandmothers, o’laim shalom, would have figured this out, or at least had the sechel to ask. You then sit and see a 10 minute movie about the brilliance of Israeli scientists and their contributions to the world, pitched perfectly to the Chinese as “we’re smart, you’re smart, we are the world.” Then you leave. Baruch Ha’Shem.
Now that that’s over, you find a shorter line at the much more elaborate (and quite impressive) Indonesian Pavilion. You pass quickly through the line. If you know what you’re doing, the moment you enter, you turn on your video camera and proceed at a quick pace throughout the entire pavilion without lowering it from your eyes. (The entrance sign says it’s a 45 minute viewing but seems to take 15 minutes.) If you lack a video camera, you simply raise your digital camera as high as you can, snapping photos at an alarming speed as you proceed through the pavilion and threatening the uninitiated with epileptic seizures thanks to the strobe-like reflections of flashbulbs off glass-covered cases, dulled only by the handprints that cover most of them. You obviously don’t stop to read a thing about the exhibits: who has the time? You also don’t hesitate to push people out of your way, whether you are 9 or 90 (more on that later). Towards the end, the line splits in two, and you go on the longer, far more congested, line, so you can get your Expo “passport” stamped which, after all, seems to be the sole purpose of waiting on line for two hours in the first place. Don’t worry — we didn’t even know what an Expo passport was when we entered, so we took the short line in time to get Alex his meat on a stick.
Most of the pavilions, at least the ones you’re willing to wait for, are architecturally stimulating on the outside, and incomprehensible on the inside. (The Spanish Pavilion starts with a silly five minute movie including a really attractive live dancer who gives you two minutes of a modern interpretation of Flamenco and concludes, with nothing in-between, with a gigantic – I mean GIGANTIC – very creepy, robotic baby wearing the Spanish soccer scarf and smiling at you while blinking its eyes. Perhaps it was a vague reference to Spanish surrealism, but Chien Andalou was really less disturbing. Alex will send pictures on request. What was it about, after two hours? Who knows? Maybe the Chinese – -they seemed to have loved it. But, then again, they applauded for the Israeli movie.)
Nobody tells you in advance that you need reservations to get into the Chinese, Macao, and Hong Kong Pavilions. So you don’t.
A word on waiting. Forget the niceties of Western behavior. By the time you’ve waited to enter a single pavilion, you’ll be qualified to be an NFL linebacker. The Chinese have no problem pushing you out of their way — I mean really pushing you — cutting you on line, putting you off balance, and otherwise violating all of the norms of western accepted behavior. But you can’t really blame them. In a concentration of people of that proportion in that small a space, it’s survival of the fittest. They’re not the least bit rude about it, and they don’t get offended if you reciprocate. (Trust me, after a while, I did.) It’s just a matter of survival, everybody gets it, and the patience the Chinese display on line would defy even the most saintly of westerners (my beloved father wouldn’t last five minutes). You’d all be proud of me, as I think Alex will agree, that I did not lose even the slightest patience for a moment. In fact I thoroughly enjoyed the whole experience, although I was exhausted after about 7 hours.
It fascinates me (although probably purely from ignorance), that during the entire day, we saw no more than 20 westerners — by which I mean 20 non-Chinese, other than the workers at the non-Chinese pavilions. And they were the only people who had any English. So at the same time that the world was here in Shanghai, it seems so much more important to the Chinese, most of whom one thinks never have left the country, to see what the world has to offer or at least to represent as offering, and they seem quite appreciative at that. Indeed the world cares too, since most of the pavilions focused on how the Chinese benefit from the offerings of each country.
I, of course, could care less about the pavilions and exhibits (although Alex who, for obvious reasons, missed the great ’64 Fair, did), but went for the cultural experience. I wasn’t disappointed. I love the Chinese (much as I wish I could be tackled a bit less by 9 and 90 year olds), and their unbelievable desire to know about the rest of the world of which they now are an integral part.
We’re both exhausted. I think we may go back tomorrow.
Finding my Inner Mao
Today’s episode will be a bit shorter, perhaps, because it was for us a quieter day. (O.K., the Battle of Stalingrad was a quieter day than yesterday). Or it may be longer, because the day’s events made me more reflective.
I spent a good part of the afternoon trying to find an adjective adequate to describe my emotions upon standing at a small table in a small room opposite the place where, on July 23, 1921, Mao, surrounded by 12 other delegates, stood and announced the creation of the Chinese Communist Party. I think I’ve settled upon awesome, in its literal, non-normative sense. I certainly know that I went back to the room and stood there more than once.
Yes, I know that there are many places in which history was made. But so few by one person, or such a small number of people. I agree with Tolstoy, for example, that battles are won by soldiers (and accident), not by generals. And there are of course places of treaty-making, constitution signing, assassinations, and the like. But rarely does one find a single physical place where, in light of the contemporaneous smallness of the event combined with the magnitude of its world-altering consequences, one can feel the tectonic shift of history beneath one’s feet. Salisbury Plain maybe? Independence Hall? But both of these were obvious in their magnitude at the time, even if ultimate success was uncertain. Marx’s study? Perhaps. In any event, while not unique in its power, powerful it was.
It was also interesting to see the manner in which the state presents the history of 20th century revolution in China and, in particular, its effects on Shanghai. Not the least bit doctrinaire. Indeed, missing entirely was the caricatured language of communist double-speak or the muscular phrases spurring on the proletariat with which one is so familiar. Measured, well-curated, interesting and, really, quite objective. That, in itself, is fascinating to a Westerner accustomed to reading the talk of communist leaders and their critics as translated and quoted in American newspapers and magazines. Indeed, it helped me understand that, while things had gone terribly wrong here for a while, and hardly have been put to right, Sun Yat Sen, followed by Chiang and Mao, liberated China from over two millenia of foreign domination, only to dominate the people in other ways. It also shows, in really quite non-normative language, how badly the Western powers mucked things up here in the late 19th century. (I know that’s hardly unique to China.) So, to put it mildly, I was impressed.
On the other hand, neither does one find talk of the peoples’ millenia of oppression in the Forbidden City where, the picture of Mao over Tian’anmen nothwithstanding, the most impressive palace and most tangible expression of overwhelming power I have ever seen (perhaps with the exception of St. Peter’s) is treated by the state as a celebration of the beauty and elegance of traditional Chinese culture and history (especially if you avoid the little disturbing exhibit about the eunuchs). It all is so terribly normal that one can easily lose sight of where one is politically in the world. And of course people are people everywhere, and the infectious charm of the Chinese helps to obliterate any remaining feeling that things might be different.
I am sure I am hardly the first person to note these ironies, but the building in which the first Party meeting took place sits along a beautiful, leafy lane in the former French Concession, surrounded by low buildings (like it) of simple, geometric, but nonetheless elegant architecture, constructed in typical gray Chinese brick, only three blocks’ walk from the Aston -Martin dealership. Across the street is the elegant Shanghai Tang, and since you all know how much I love clothes, you’ll also appreciate my restraint in refraining from buying some of the magnificent modern interpretations of Chinese clothing I know I’d never wear at home. (Actually, I will.)
In any event, after the hoopla of Expo yesterday, we found peace and greenery in Shanghai, in a clearly wealthy neighborhood of elegant shops, perfectly manicured parks, lovely restaurants, and well-dressed professionals, punctuated by new, but stylishly retro-modern high rises built (and sold) at clearly great expense. While the look was not the same, it felt to me like a combination of the blocks along lower Fifth Avenue approaching Washington Square, Gramercy Park, a little bit of St. Germain, and maybe a touch of the Via Veneto thrown in for good measure. Yes, a true worker’s paradise, if the workers could afford to live here. Instead, the workers live just a few blocks away, over the stalls populated with live fish and chickens, small hot restaurants with stoves outside and a few tables within, and the stench of frying stinky dofu (don’t even ask) pervading everything over the narrow streets with laundry hanging everywhere, and men and women in pajamas sitting on plastic stools sorting crayfish or opening oysters or gutting something or other and tossing the offal into the streets.
But that is a few blocks and a lovely park away. Nothing to disturb the memories of the liberators of the proletariat as the wealthy young Shanghainese eat, drink, and be merry.
Alex may want to go to Expo again tomorrow. Pray for me.
Of White Monkeys and What One Child Policy?
Today really will be brief. Although it’s been rainy and cloudy all week, today was the worst we’ve had in Shanghai. So what do you do when it’s raining — I mean really, almost tropically, pouring? Something indoors, preferably (although not entirely, as noted below). We’ve already seen the best museums here, and Expo hardly is an indoor experience so, why not the Shanghai Ocean Life Aquarium, just a fifteen minute walk from the hotel, set along the bank of the Huangpo and rated, according to the guidebooks, as one of the best in the world.
Yes . . . well. What do millions of Chinese tourists, not to mention Shanghainese parents going out of their minds during the rainy season, elect to do on a really bad day? What do day camps do when outdoors is not an option? Yup. The Shanghai Ocean Life Aquarium. Hours later, I haven’t quite gotten my hearing back, and still am shaking a bit, but l loved it. Alex was a bit crankier, although for the most part handled it well. And the guidebooks were right, at least as far as my aquarium experiences go — truly first rate.
Based on the groupings of children and adults we saw, it does not appear that the one child policy is very seriously enforced anymore. In fact, the number of children (compared with adults) would lead you to think that the Chinese had been converted by the Chasidim! It was bedlam. Not the controlled bedlam of Expo, but pure, unadulterated bedlam. And let me assure you that Chinese children are at least every bit as spoiled and undisciplined as Jewish kids, or at least my Jewish kids. But how could you avoid smiling? The kids evidently were having so much fun. Particularly cute was the camp group with their orange sunvisors and shirts that numbered well into the tens. The only problem with them was their counselor who insisted upon blowing her whistle in three note phrases every two of three minutes, piercing the ears already thankfully numbed by the high-pitched din of little voices. This, again unlike Expo, in an indoor space. And, even better, the aquarium features a 500 foot long underwater tunnel (which is really cool but completely unavoidable because it’s the only way to the exit), with a diameter of no more than ten feet. Behavior was not changed to accommodate the space.
Prior to entering the tunnel, I stopped to rest on an elevated section of floor designed to resemble rock. Sorry for me, I didn’t notice the fake tree rising out of it, nor the model of a monkey perched above my head. Hesitantly, at first, a tiny girl of no more than eight years stopped with the ubiquitous camera, shyly aimed, and shot. I smiled. Then several more. Then a pair of slightly older girls noticed Alex sitting in a simian-free corner (simian free, that is, except for Alex). They each took a picture of him. Then each took a picture of the other standing with Alex. They repeated the process with me. By the time they had finished, an alarmingly large group of camera-armed young children began surrounding us and snapping, in some cases egged on by their parents. It makes a guy a bit self-conscious, at least if that guy isn’t Brad Pitt, ’cause you know you’re neither famous nor good-looking. You are, however, the white monkey. And it is entirely plausible given our experiences in the cities that, especially, the tourist children from the hinterlands had never seen one in the flesh. Especially one like the long curly-haired one. The only way we could end their detour to the zoo was by smiling, nodding, and gently edging our way toward the next exhibit. As we did so, a young girl smiled at me and I told her, in Mandarin, that I could not speak the language. She smiled broadly and, in an innocently patronizing way (and in perfect English) said, “very good!” I laughed.
Like any other capitalist attraction of its type, one exits through the gift shop. I looked for something for Ba, but the stuff was even too drecky for her tastes. So we got out, sat while Alex had ice cream, and figured out what to do next. We had planned a cruise on the Huangpo, so we wandered down to the docks. By the time we arrived, we weren’t thoroughly soaked, but we were respectably wet. After contemplating an hour on a rainy river in what undoubtedly would be a smelly cabin with gold-tinted windows so that Alex might get a decent picture of the Bund, we punted on that one. Instead, he inveigled me into a walk along the lovely park that abuts the river. Half an hour later, by the time he got his photos, I was drenched and my shoes were thoroughly sogged. A quick cab ride back, a nice trip down to the steam room, and that’s it for today. That, except for a scotch and another wonderful Shanghainese feast.
Back to Beijing early tomorrow, with the Great Wall planned for Sunday. More on that after the event. You’ll likely be grateful to know that these missives will likely start to fall off, as I start teaching Monday.
Today was a remarkably quiet day, due largely to our exhaustion. We stayed out a bit late last night, dining at a truly fantastic, colonial Shanghai-style restaurant on the Bund (who knew Mapo Dofu could be transforming?), overlooking the lights of Pudong which can only be described as “Wall Street Goes Vegas.” Then an after-dinner walk so that Alex could take pictures of this garish and beautiful scene, made even more sparkling by the soaked streets and bobbling river from the recently-ended deluge. But we had a very early flight to Beijing, came back to the apartment, and Alex (who regrettably is getting sick) lay down while I braved a Chinese supermarket to stock up on things for him. We had lunch in a little Bao house (take that, Gropius!), where there was simply no English — not on the menus, not in the room — and no pictures. No English — ok. No pictures — ok. No English and no pictures? Yikes! So we underlined random Chinese phrases on the menu and did fine, although I really don’t want to know what those things in aspic were. We then proceeded up a few blocks to hang among the small shops (and big mall) with the students from Tsinghua University across the street and Beida, down the road. I returned home, concluding that the state of studenthood was universal to all who pass through it, and that I was glad to be out of it.
But a funny thing happened on the way to the university. As soon as we had gotten into the cab and began driving the now-familiar tree-lined freeway from the airport into town, I felt at home. Not just like I had come home. But at home, in the same way a peaceful feeling just slides down you when you walk into the door after a long time away. And it didn’t diminish, not even after we had entered the apartment we had occupied for all of 2 days and dropped our suitcases on the floor.
Now, in the first place, I have no right to feel this way. Half of my nuclear family (really 60% in an important sense) remains in Washington, and I miss them very much. Second, I have only been in Beijing twice in my life, the first time for ten days almost three years ago, and the second for the two days Alex and I were being feted before leaving for Shanghai. Who has the right to call that home? But that is precisely what it was.
I don’t know how to explain it. Is it just the visceral distinction between the familiar and the unfamiliar? That can’t really be it, or at least all of it, because by the end of a week, we were pretty familiar with Shanghai and comfortable getting around. Was it the simple fact of returning from a hotel to an apartment in Beijing, where I could finally ditch my Chinese-teenager shirts for the welcome ones I left back here a week ago? That hardly seems plausible, either. (I kind of liked the new look!) And while it is true that our first two nights in Beijing were something of a homecoming, with hugs from old friends and eager greetings from new ones, it was hardly like walking into a reunion with the best friends of your youth (and increasing age).
I’m not sure of the answer, but here’s a try that I know I will rethink. It goes something like this. When one is so far away from one’s comfort zone, from the back-of-your hand type places, from the people you love, from the language you speak, from the mere subconscious sensation of the physical environment that is yours, one grasps at anything even remotely familiar with the same sense of rightness, of possession, of peace, that one feels in the most familiar places. I feel it walking down 21st St in Washington, I feel it on random streetcorners in the West Village or the Upper West Side, I feel it driving onto Route 2 in Williamstown, I even feel it walking across the University Yard. And today I feel it in Beijing.
Is it real or simply a mind game? Honestly, I don’t know. It would be far simpler to figure out were it intellectual rather than visceral. But the strange thing is that, while I’ve traveled plenty before, and been back to many of the same places, I’ve never quite had this feeling. Familiarity, yes. Happiness at being back, yes. But home? Never. Not even in Israel where I felt at home, but in a very different way that triggered very different and much more turbulent emotions. Peace? Nope.
Ah, but wait for tomorrow. After the perils of climbing the Great Wall and the madness of the crowds (oh and another banquet tomorrow night), I’ll be screaming to come home.
There is an ancient saying, that he who has not climbed the Great Wall cannot be a real man (hao han). That saying has modernly been re-interpreted (one suspects since 1949), as one who has not climbed the Great Wall cannot be a hero. Those of you who are fluent in Mandarin will have noted that the term hou han, translated as real man, is interesting, because the Mandarin word for man is nan ren, and for adult people more generally, ren. Han is the word for the Han race. So in both of its iterations, it reflects the interesting ethnocentricity of the Chinese.
Today we climbed the Great Wall. Our charming guides, who (as is common in my experience with the hospitality of Chinese academics) were not nan ren, but were decidedly han, became hou han. Alex and I became hou (good) white monkeys.
Had the Mongols seen the parking lot at Badaling on a brilliant Sunday noon during the school vacation season, there would have been no reason to build a great wall. They would have fled back to their yurts, wherever they had last left them, and considered themselves to be the better for it. They lacked that opportunity, resulting in what really has to be, hype notwithstanding, one of the truly great structures created by mankind. Hence the two mile walk to the entrance, leaving our driver to fend for himself to find someplace to park for a few hours between the lines of people shouting at him to eat in their “famous” (and expensive) restaurants. Entrepreneurs in Chinese tourist sites could have taught P.T. Barnum a thing or two.
Now I have talked about crowds, and the patience of the Chinese, so I won’t belabor that too much (well, a bit, because it is informative both of the national character and the culture). Just accept that you’ve never seen a crowd like that (unless you’ve been to Expo).
The amazing thing was that the crowd had gathered under a sun shooting out 40 degree celsius heat (for those of you who don’t want to bother with the conversion, that’s damn hot). And it is especially hot when you are walking on the wall with, minimally, tens of thousands of your best friends with no shade except the occasional (blissfully cool and breezy) guard tower, and the thousands of umbrellas Chinese women carry in an unfortunate racially misguided attempt to keep their skin as white as possible (pace Michael Jackson). Indeed, when one is attempting to climb up or down near-vertical stairs, or doing one’s best to avoid a bottom slide down a tenth of a mile smooth stone downgrade at about 30 degrees, those umbrellas are downright lethal weapons. Dark skin is beautiful. And if they don’t like it, here’s a huge opportunity for an American sunscreen company. Save your skin and other people’s eyes – it’s got Madison Avenue written all over it.
The area around Badaling is mountainous and beautiful. Not just mountainous, but the sharp-peaked, steep angled, distinct and separate mountainous of Chinese classical painting. It would be stupid for me to muse on what it took to build the wall that follows that terrain at about a 40 foot height (at least), or how they possibly did it, so I won’t. Some things are best left to imagination rather than analysis, and so I choose to leave the wall.
But it is stunning. No more than 12 feet across at the top (that’s about 4 meters to you and me), it literally goes up and down mountains, snaking along with the terrain for as far as the eye can see, sometimes curving gently, sometimes making hairpin turns like the one that leads down from Route 2 into North Adams into Williamstown (which I remember taking once en route back from Mt. Holyoke of a winter’s early morning in neutral, with no gas, and with too much beer – God protects idiots, orphans, and college students). There are rarely any flat stretches. Sometimes the angle is 20 degrees, sometimes it’s close to 80 degrees (judging by eye), and the allocation appears to be random between stairs of different height risers and smooth stone passages. What I do know is that there is no point at which the view is other than breathtaking (other, that is, once you get past the huge “One World, One People” sign left over from the 2008 Olympics that Dalia and I had the pleasure of seeing in 2007.)
As I said, don’t even try to think of how it was built. Just don’t – your imagination isn’t that good. But do note that, on this unbelievably hot and sunny day, up to at least a point (beyond which we proceeded), Chinese tourists, either desiring to become hou han or at a minimum proud of their national heritage, walked cheek to jowl up and down, and down and up. Young and younger. Old and older. Seriously, children as young as about 5 (and more than a few, not to mention the babies who were carried), and men and women well into their dotage, kept up on a topography that left me, after the last long up-stairs, with my lungs hanging out of my mouth. Hard to imagine the tourists chomping down corn-dogs on the DC Mall in the same season even contemplating the walk to the entrance, rather than a work-out that left my young, strong, but asthmatic son about ready to call it quits (and periodically scolding me that I was exhausting our comely young guides). National pride in a Chinese way – risk your life to see your national treasures. Pretty cool.
Now back to the white monkeys. Alex was the star this time, being chosen for a photo shoot, one by one, with a group of Chinese young men hanging around on a flat stretch. (Face it – he does bear a resemblance to Charlton Heston in The Planet of the Apes.) But I was the linguistic star. For some time, we walked beside (or among) a group of 10-12 year old Chinese schoolboys out on a frolic. At one point, a young man mustered the courage to say to me: “Hi, how are you?” His friends stopped, stunned by the idea that he would take such a risk. I responded (I’m proud to say) in fluent Mandarin: “You speak English very well.” The boys stopped again, in what appeared to be nothing less than shock. But this young hou han was not to be outdone. For he replied in Mandarin, without hesitation: “You must have worked very hard to be able to say that so well.”
The word for old man in Mandarin is lao ren. This lao ren, while laughing, thought the best solution for him would be to creep back into his monkey cage. And so I shall.
Tomorrow I start teaching. Help me.
Top of Form
Bottom of Form
Few of the developments I‟ve described could have happened without the triumph of neo-classicism and its effects on American law and public policy from the 1980s through the 2008 collapse.
The legal story begins with a variety of measures designed to deregulate the banking industry, starting with savings and loan institutions in the 1980s and culminating in the virtual liberation of commercial banks from New Deal restrictions with the passage of the Gramm-Leach-Bliley Act in 1999. Banking deregulation began with efforts to permit institutions which had distinctly local or regional business to grow nationally, and increasingly removed restrictions on the businesses in which the regulated institutions could engage. This, along with attractive inducements from states like North Carolina, paved the way for substantial bank consolidation in the 1990s and early 21st century.
Traditional small lending institutions thus became further removed from their clients, and banks sought greater profits in the process of securitization, which brought higher profits than mere lending and allowed banks to evade capital restrictions. Securitization, which of course is represented most publicly by mortgage-backed securities and other forms of consumer-debt backed derivatives, allowed loan officers to pay less attention to the safety of their loans, since they were promptly to be sold off and removed from banks’ balance sheets (although not entirely from the risk assumed by the banks).The Commodities Futures Modernization Act of 2000 ensured that these instruments would not be regulated.Despite their profound effect on the real economy, these instruments mushroomed in growth while providing financing not for production but simply for more finance.
This process paralleled what happened in the stock market under the capital asset pricing model and its progeny, largely separating (on paper and in practice) the responsibility for, and consequent monitoring of, risk from the real economy that nonetheless was exposed to that risk. The story of credit derivatives has been told many times, and I only mention it here in order to show how it fits into the rest of the story of financialism, and how the law consciously adopted the ideology of free markets in order to permit financialism to develop.
I would be remiss in ignoring the regulatory failings of the Securities and Exchange Commission, and especially its fateful decision in 2004 to permit largely unregulated investment banks to dramatically diminish their capital requirements (and its inverse, to increase their leverage),eliminating one of the very few regulatory tools available to the SEC to limit the activities of investment banks.
In addition, bank regulators, misplacing their trust in the prudence of bankers, also significantly diminished capital reserve requirements. This allowed banks to borrow and gamble with enormous sums of money while maintaining little available cash to help them through financial distress. As the U.S. implemented an international agreement to lower banks’ capital requirements in 2007, New York Senator Charles Schumer said: “There need not be a conflict between being the safest and the most competitive, and this fine agreement proves it.” The echoes of economist Irving Fisher‟s famous early October 1929 statement: “Stock prices have reached „what looks like a permanently high plateau,”are all too resounding.
The highlight of deregulation and, I believe, the most foolish piece of economic legislation ever to be passed by Congress and signed by a president, is the Gramm-Leach-Bliley Act of 1999. Its most important consequence was the merging of commercial banking and investment banking functions to permit the growth of enormous financial institutions whose role in protecting the nation’s credit system and money supply was now compromised by the huge profits available from speculation in securities and derivatives. This growth was accompanied by increased incentives of well-compensated bankers to earn fortunes from engaging in the creation of new financial instruments and proprietary trading which, just as in the years preceding the Great Depression, exposed that credit system to the possibility of collapse.
It is unfortunate to note that, despite some recognition of these failings, the course of “reform” points in the direction of continuing to institutionalize financialism, which I believe will eventually succeed in destroying American capitalism. Such reforms will do nothing to shift financialism back to capitalism, but rather maintain financialism on perhaps a slightly safer plane.
Restoring American capitalism in the face of growing financialism is urgent, both as a function of American economic well-being, and as a matter of national security, as financialism pushes the production of essential goods abroad. Faced with this urgency, it is short-sighted and irresponsible for lawmakers, regulators, financial professionals, lawyers, and even the investing public, to fail to understand our shift to financialism and the long-term destruction it promises for America’s economic well-being.
How do we fix this? I have some preliminary suggestions, some of which have emerged in the reform debate. It is critical to re-enact laws separating investment banking and commercial banking, pass tax law reform to diminish market volatility, consider financial reform that would require demonstrated economic utility before the offering and sale of new financial instruments, create accounting reform that would require all corporations, including financial institutions, accurately to reflect their debt exposure, ensure full tax parity of capital gains and dividends in order to encourage long-term investment and re-introduce the notion of patient capital into American investment practices, restrict the types of compensation contracts corporations, and especially financial institutions, can award their employees (principally accomplished through tax laws), and create disincentives to proprietary trading and incentives for financial institutions to return to their former financing practices (again, most likely through tax changes). All of these changes could be made without unduly aggressive government restructuring of the basic economy. More aggressive suggestions include the use of antitrust law and perhaps new legislation to encourage the development of smaller and more localized financial institutions that monitor their risk because they remain in relationships with their customers, restrictions on the amount, if any, of a financial institution’s assets it can securitize, and law and policy statements that disavow the acceptance of institutions that are too big to fail, including a reconsideration of the role of the Federal Reserve in financial disasters.
The need to end financialism and restore capitalism is underscored by the special moral role a sound economic system plays in our society. Perhaps the most important benefit of capitalism is its ability to stimulate economic growth, the creation and distribution of wealth, and the sustaining of that wealth over time. Whatever benefits financialism may have, it lacks these essential characteristics. Indeed, as I hope I have at least preliminarily shown, financialism is a system in which the present generation robs future generations of their economic patrimony and national security and thus is intrinsically immoral. We owe to our children, and our children’s children, the benefits of a system that allowed the United States to become the world’s most successful and prosperous democracy from its founding until the present. We must destroy financialism for the sake of capitalism.
Six o’clock on a Saturday evening in May at Birdland is probably nobody’s idea of hip. But for us, and it seemed for the rest of the happy few in attendance, it was transcendent. Barbara Carroll’s set goes down for me as one of the five or so performances that changed my life.
We were there almost by accident. I had been planning an evening at the opera but, around three, my companion and I decided that — as much as I love Cosi Fan Tutte– an investment of almost four hours wasn’t in the cards. And the early show at the Vanguard was sold out. So I happened upon Ms. Carroll’s performance. I had never seen this particular jazz legend live, and so it was that we settled at our table shortly after five.
Birdland at that hour is a bit surreal. The black walls, the dim lights, the very essence of the deep, transgressive night — and sunlight peaking through the windows. It seemed almost obscene to be there before darkness. Ms. Carroll outshone the stars.
I worried as she walked onto the platform, aided by her perfectly-paired bassist, Jay Leonhart, whether she would make it to the keyboard. Ms. Carroll is stunningly beautiful, elegant, frail, and 89 years old. She steadied herself at the piano, turned to the audience, and beamed the smile that was to come back repeatedly through the evening. Trembling slightly, she sat.
Her opening chords obliterated any doubt. As she began her sonata -like rendition of the deeply meaningful, “Let’s Face the Music,” I knew we were in for something special. And when, as she hit her groove several measures later, she bopped the keyboard with that magnificent smile, I began uncontrollably to grin and, except for those few moments where I was truly overcome, couldn’t stop.
What made this performance so special? Obviously, one doesn’t often see an 89 year old performing as if she were at the top of her game. But she is. Her chops are just fine, thank you, whether introducing contrapuntal Bach lines into a number or slipping in a phrase or two from a Gershwin prelude, from barrel rolls to dancing arpeggios – Ms. Carroll plays. That would have been enough. But there was so much more. As my erstwhile companion, whose musical taste and human insight I judge to be impeccable, put it: “She knows everything.”
Ms.Carroll does know everything. At least everything that matters. From her sexy, sly, and provocative come-on, Bart Howard’s, “You Are Not My First Love,” to her utterly convincing rendition of Cy Coleman and Peggy Lee’s, “I’m in Love Again,” Ms. Carroll yielded nothing to age, and everything to talent, experience, and her deep knowledge of what it is truly to be human. “Nothing bothers me now, I enjoy everything,” she sang, looking out at us smiling, and we knew the truth of it.
She sang to each of us. She made me feel as if there was nobody in the house but me. And, what she was showing us, was how to live. Her song selection was brilliant, each one progressing through a marvelous story of life. Eleanor Roosevelt told us that while a beautiful young person is an accident of nature, a beautiful old person is a work of art. Ms. Carroll is beauty, simpliciter. And, last night, I fell in love with her.
She concluded the formal set with Stephen Sondheim’s “Old Friends.” I have to confess that my eyes weren’t dry at that point. When I went to thank her after the performance, she took my hands in hers, looked at me, waited as if she had all the time in the world. The only words I could manage, were ‘thank you.” And she gave me that world-embracing smile.
Who is like Barbara Carroll? As Sondheim wrote, “damn few.”
I have thus far shown the development of financialism and its effects upon corporate finance. But financialism also profoundly affects the way that managers of businesses in the real economy define their business goals. In 2006, over 30% of the profits of corporations classified as “industrial” came from financial transactions, not from the production of goods and services, and financial assets constituted almost 48% of the total assets of non-farm, non-financial corporations.Only a relatively small portion of this is composed of accounts receivable. By far the largest class is identified as “miscellaneous.” Industrial corporations, at least pre-crash, had come to rely upon finance rather than their own core businesses to provide profits. This has obvious adverse potential consequences for the future of American economic self-sufficiency.
Why has this occurred? There are several reasons. The first is the capitulation of industry to the demands of finance that I described earlier. The second, which goes along with this, is a shift in the prior careers of industrial CEOs, from marketing and engineering earlier in the century to finance, which came to be the most common background of CEOs between 1997 and 2007.The training and interests of these chief executives, and the greater profits to be made from finance, inevitably incline them in that direction, and suit the demands of financialism better than those of capitalism. American Can Company is a perfect example. Incorporated in 1901, that important manufacturing corporation acquired a modest Midwest insurance company in 1981 and, along with it, Gerald Tsai, Jr., the famous, fallen whiz kid of 1960s speculative mutual funds. As vice-chairman and then chairman of American Can, Tsai abandoned manufacturing and transformed the company into financial conglomerate, Primerica.General Electric, one of the mainstays of American industry since the late 19th century, presents a different type of example. While it continues its manufacturing operations, it now reaps a substantial proportion its profits from its financial subsidiaries.It isn’t difficult to replicate these stories many times over.
A final reason is changes in executive compensation. Executive compensation became largely stock-based beginning in the early 1990s, thus creating incentives for CEOs to engage in
financial manipulation in order to achieve higher stock prices.Even in periods of strong industrial production, the profits of industry often pale in comparison to the profits generated by financial transactions. In order to earn the returns that would justify higher compensation, they turned, as the data above suggests, to finance.
I’ve described the growth of institutional investors, but now would like to address the incentives and behavior of institutions that have contributed to the rise of financialism. Institutional investors are a particularly important
I’ve described the growth of institutional investors, but now would like to address the incentives and behavior of institutions that have contributed to the rise of financialism. Institutional investors are a particularly important cause of financialism, even as a debate continues over giving greater power over corporate affairs to stockholders which, in practical terms, means institutions.Yet institutional investor activism has been one of the principal causes of destructive short-term management in the real economy.
Institutional activism was hailed in the early 1990s as the solution to the longstanding set of problems known as agency costs caused by the separation in the modern corporation of ownership and control. Agency costs are the losses that result when corporate managers favor their own interests over that of the shareholders together with the expense of preventing this. It was widely thought that institutional investors, through their large blockholdings of stock, could provide the shareholder oversight that disappeared with the creation of the large public corporation at the turn of the 20th century and had been sought since at least the publication of Adolf A. Berle, Jr. and Gardiner Means‟s The Modern Corporation and Private Property in 1932.
That utopia was not to be realized. Some critics, including me, predicted that the natural incentives of institutional money managers would lead them to use their power to push corporate managers to focus on short-term stock prices rather than long-term corporate health and patient profits from production. That prediction has been amply borne out both by observation and in rigorous empirical studies, and many of those who had celebrated institutional activism have since retreated from those views.
Two other kinds of institutional investor flourished in the years before the 2008 market collapse and are likely to remain active after recovery; private equity funds and activist hedge funds. Although very different in their business models and functions, these investors have also contributed to financialism by exacerbating the short-term climate that led to industrial overleveraging, the disappearance of retained earnings, and the practice of subordinating the ends of production for the gains of finance.
Financialism has diverted economic resources from capitalist production in the real economy to satisfy the demand of financial claimants, primarily stockholders. To recap, data I’ve collected over several years show the disappearance of corporate equity capital and its replacement by massive amounts of debt, largely done to satisfy the demands of finance.The argument here is that American public stockholders have withdrawn more equity from corporations than they contributed, leaving debt as the real risk capital of American industry. Yet the legal power to control American corporations rests with the stockholders. The result is a disconnect between responsibility and risk, and has destabilized the capital structures of American industrial corporations while leaving stockholders with the power to pressure managers to gamble with industrial credit and economic well-being. While stockholders do continue to take risks, the logic of the capital asset pricing model tells us that the risks they take are casino risks created by themselves, not real financial risks which have been left to creditors. What is true of stockholders is even more true of derivatives traders and the financial institutions that trade for their own accounts.
Here are some facts: From the turn of the 20th century until the 1960s, American industrial corporations practiced a policy of retaining substantial portions of their earnings for reinvestment in their businesses while paying a reasonable dividend to shareholders and relying upon trade credit and some long-term debt for the balance of their needs. Retained earnings averaged in the range of 50% to 60% as recently as the early 1960s. By 2007, that average was down to 11%, rising from a low in 2002 of just over 3%. Almost all of the rest of the money needed to finance production came from debt, increasingly shoved off-balance sheet to conceal corporations‟ true reliance on borrowing.
How and why did this happen? As more Americans entered the market, which grew at its fastest pace during the great bull market that lasted from 1952 until 1970, investors’ desires shifted from steady dividends to making quick capital gains from trading.Approximately 90% of listed corporations were paying dividends, and there was a general belief that dividends were what individual investors sought. There was good reason for this. Although dividend payouts were low compared to the 1920s, in 1952, 52% of corporate earnings (a post-war high) were paid out as dividends. But dividends did not appear to be the answer. A two day study of market transactions by the NYSE in 1952 revealed that 46% of individually-purchased shares were bought for long-term capital gains, followed by 25.5% for income, 13% for capital gains within 30 to 120 days (which the Exchange classified as long-term, although the federal long-term capital gains tax break occurred only after six months), and 6.5% for capital gains in under 30 days. Putting together transactions by members and institutions, the Exchange concluded that 75% of all transactions had been for investment purposes rather than speculation. But particularly notable is the fact that the vast majority of individual stock purchases were in pursuit of capital gains rather than income.
Prior to the 1960s, those capital gains largely came from the increase in share value caused in large part by the retaining earnings I just mentioned. The investment technology derived from the capital asset pricing model taught investors to see capital gains as coming from the future anticipated cash flows of the corporation, discounted to present value. Thus, instead of selling their stock for money already earned, investors began to sell their stock for money that was to be earned but which may never be earned, and thus, in a sense, shorted future dividends or, to put it differently, stripped the profits of the future for the benefit of the present. This process was exacerbated by the increasing impatience of investors for capital returns, especially the rapidly growing class of institutional investors whose money managers were compensated based on the amount of assets they had under management, and who were beginning to acquire the ability to put pressure on managers to increase stock prices. Even without this, the increased volatility of trading for capital gains that had started to soar in the 1980s gave managers strong incentives to maintain high stock prices in order to maintain the independence of their companies, and later to increase their own compensation as stock option compensation came to dominate due to tax reform in 1993. The result was to put pressure on mangers to manage for stock price, not for long-term sustainability. Perhaps the most trenchant piece of evidence for this is the fact that in a three year period ending in 2007, the S&P 500 spent more money on stock buybacks (which increases stock prices) than on investment in capital production.