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The Prudential's latest project is a $100 million regional home office and city center in Boston (TIME, Feb. 11). Many insurance men would quail at such an enormous expenditure. Says Shanks: "You can find all the reasons for not doing a thing, or you can find some reasons for doing it. If the reasons for doing it are good, then you have got to have the courage to try it, and work out the problems as they come up."
To some, the success of the Prudential's investment policy, spreading its wealth into big and little companies, is worrisome. Many a Congressman frets that insurance companies have accumulated too much power over too much of the U.S. Shanks has acted as spokesman for the industry in its defense before congressional committees. Once, testifying before a House monopoly subcommittee, he outlined his aims so lucidly that even New York's New Dealing Representative Emanuel Celler was mollified. Said Celler: "Shanks made the best impression of all. He indicated an awareness that insurance companies, due to their size, must exercise social responsibility." Actually, Shanks is not worried that the industry is too big. Rather, he worries that it is too small. As the U.S. economy grows by leaps and bounds, the U.S. is putting a smaller percentage of its income into insurance, last year invested only 3.8% of disposable income in insurance v. 5.1% in 1940. The problem is: How to get more savings into insurance, to supply the loans for the expanding U.S.?
Feasts & Fortunes. If the Prudential's Shanks is only too well aware of his sociological responsibilities, many of his predecessors in the industry could hardly have cared less about such niceties. In the early days of U.S. insurance, most firms were stock companies concentrated in the hands of a few powerful men who treated policyholders with royal contempt, and piled up royal fortunes. By 1905, scandals so wracked the industry with revelations of fraud, corruption and lavish parties given by insurance executives that New York State 'started an investigation. It uncovered such fraud that before long the industry was under stricter governmental control; sharp-eyed insurance commissions in every state took a closer look at company books, regulated every operation from policies to investment.
The Prudential was not seriously involved in the great scandals. Founded a quarter of a century earlier by a sober, bookish young man named John Fairfield Dryden, it did its first business in "industrial insurance" for the workingman, policies that cost only pennies a week for up to $500 worth of life insurance. By 1911, when Founder Dryden died, it had 10 million policyholders on its rolls, soon afterward started shifting over from a stock company to a mutual operation owned by its policyholders.
Fringes & Flints. As the Prudential's seventh president in 81 years, Carrol Shanks sits behind Old John Dryden's huge mahogany desk, in a suite of offices in Newark built in the days when insurance men spent heavily for purposes of prestige. Hand-carved Honduras mahogany frames the president's doors and windows; the walls are covered with silver-filigreed blue paper, the ceiling fringed with gold leaf; deep piled rugs smother the floor. Shanks sometimes works in his shirtsleeves, dials his own phone.