Sandy's Story

By Bill Saporito Sunday, Mar. 16, 2003
    • The dramatic engine of Tearing Down the Walls, Monica Langley's biography of Citigroup CEO Sandy Weill, is his lifelong struggle for acceptance among Wall Street's elite. What a burden, we are repeatedly reminded, was Weill's background as a rumply Jewish kid from Brooklyn, N.Y.--he's even the wrong kind of Jew!--as he fought to overcome anti-Semitism and class prejudice to make it to the top, not once but twice. It's a nice story line but a somewhat artificial one.

    Whatever social obstacles the Cornell-educated Weill faced when he hit Wall Street in 1955, he had built a respectable brokerage in Cogan, Berlind, Weill & Levitt by 1969. He then swallowed Shearson, Hayden Stone and other houses before selling the whole shebang in 1981 to American Express. By 1985, when Weill lost a power struggle with white-bread Amex CEO James D. Robinson III and was ousted as president, it wasn't because Weill was Jewish. He was just outmaneuvered. And he left as a multimillionaire. It's difficult for Langley to set a good sob story at Weill's palatial New York City apartment, his Greenwich, Conn., mansion and his daily lunch table at the Four Seasons.

    No matter. What Langley, a veteran Wall Street Journal reporter, does give us in this book is a richly reported recent history of Wall Street and corporate America told through an oversize personality. Weill is a gregarious man with a blowtorch temper and a need to be loved. And he is a window on the shareholder revolt against corporate bloat that raged through the 1980s and '90s.

    When deregulation came to Wall Street in 1975, Weill found his weapon. Fixed 15% commissions were history and soon, too, were some of the old brokerage battleships that had stayed upright with that ballast. Weill and his partners Roger Berlind, Arthur Carter and, later, Arthur Levitt torpedoed one competitor after another because they were better stock pickers and better managers.

    After the Amex embarrassment, Weill and his band of mercenaries took over Baltimore's Commercial Credit Co. (CCC), a substandard subprime lender, then used CCC to go after bigger and bigger deals until they got to Citicorp. The bottom line wasn't the main thing; it was the only thing. As Langley shows, in Weill's world, anything that didn't produce revenue was gone. No perks were too small to eliminate.

    Unless they were his perks. As Langley documents, somewhat uncritically, Weill exemplified the superstar CEO, with a double standard that grew with his deals. He bristled at the $30 million golden parachute that Gerald Tsai crafted for himself in selling Primerica to CCC, but at the same time, Weill insisted on buying Primerica's Gulfstream IV jet as part of the deal. Weill is the kind of guy who could finish off a $200 lunch, return to the office and slash 2,000 jobs.

    And it would be logical to him because he is adding value for shareholders. Weill works tirelessly. The companies he took over were either in desperate shape or fat, dumb and happy; he made them lean and mean — and spread stock options through the ranks. Langley's Weill is deal hungry, overcompensated and, when necessary, cold blooded. He famously ousted his respected protege and potential successor at Citigroup, Jamie Dimon (now CEO of Bank One), to preserve his own power.

    Langley's reporting on the Citicorp-Travelers merger and the titanic cultural battle that ensued between the cerebral John Reed and the gut-driven Weill is spectacular. Can you imagine a $73 billion company with two CEOs and three presidents? Reed's defenestration seemed just a matter of time, to everyone but him.

    Langley's writing isn't quite up to her reporting. Beyond Weill, the characters seem flat and their stories just litanies of facts. But the facts speak volumes about one of the greatest businessmen of the past century. Weill doesn't get to go out a hero — at least not yet. Citi has been sullied by evidence that its stock analysts touted shares of suspect firms to win their investment-banking business, and Weill has promised to do "whatever it takes" to get the firm in order. He's nearly 70 but has shown little interest in naming a successor. Retiring as king of a corrupt Wall Street would be a terrible defeat. He isn't likely to let it end that way.