Wolff: Oops, tell-all 'Class Clowns' author did it again
The peculiar problem of business writing is that most writers know little about business. Even if they study it, few writers are ever going to have the experience of making, or losing, big sums. For business people who think they can write, but for obvious reasons are reluctant to bite the hand that feeds, the result is, most often, exhortations and testimonials. And most get someone else to do their writing for them, anyway.
Hence, it is very easy to nominate irascible, contrarian, eloquent and, as well, one the leading bankers in the media sector, Jonathan Knee, as the nation’s best business writer. His most recent book, Class Clowns: How the Smartest Investors Lost Billions in Education, is out this week.
Knee has written a series of books drawing on his experience as a banker in which he exhumes deals, many of which he has first-hand knowledge of, applying — and somehow navigating non-disclosure restrictions — a devastating and, often, witty, forensic. His is the kind of knowledge we might assume many bankers have, but are too cowardly, venal or inarticulate to share.
Class Clowns, for instance, deconstructs a series of deals in the continuing bubble of the private education market. The allure of ever-increasing spending, combined with a desire among rich men to do good, or believe they are doing good, results in a series of delusional assumptions and vast shareholder losses, on the part of such masters of the universe as Rupert Murdoch, Michael Milken and John Paulson. The hubris and comedy are greater than even their bad math. These are less case studies than character studies — quirks in human nature collide, generally unhappily, with market conditions. Knee’s portrait of Chris Whittle, who once owned Esquire magazine, flipped that into an illusory empire of sponsored media, and then, with vast amounts of other people’s money, set out to privatize and revolutionize American education, is one of the great tales of hucksterism in an age of hucksters.
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Knee, who in addition to his senior role at investment bank Evercore Partners is a teacher with a dedicated following at Columbia Business School, is also the author of The Curse of the Mogul. This is the seminal book on the '80s and '90s consolidation of the media industry from thousands of companies to a handful. He rather does for the media business, exposing its vanities and illogic, what Joseph Heller did for the military. The moguls, in their spasm of Napoleonic empire building, got rich at, predictably, the expense of their shareholders. Knee’s book became a piece of the I-told-you-so rationale during the past few years of break-up and spin-outs in the media business, and now, befitting the fate of most cautionary literature, is being ignored as these businesses get ready, once again, to reconsolidate (hello, AT&T and Time Warner).
Before this, Knee went from being a successful investment banker with a sideline of writing book reviews for Peter Kaplan’s New York Observer, to writing what is perhaps the only actual insider account of being a successful banker — The Accidental Investment Banker — a gimlet-eyed deconstruction of the culture that has shaped so much of modern business life, in fact so much of the entirety of modern life as we know it.
The most obvious question is how he gets away with it? Why would clients continue to pay him to reveal not just their secrets, but their fundamental character flaws?
I think this has to do with his rare and curious dual role as a person who is both accomplished at his job and a critic of it. Most critics, or memoirists, or journalists or bloggers are disaffected insiders, or outsiders pressed to the glass. They are in mortal conflict with their subject — that’s the modern critical condition. From business to politics to the arts to human relationships, it is us against them. Neither side has had the same experience; neither side has the same emotional basis, neither side even has the same language.
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Jonathan Knee remains happily and profitably ensconced in the investment banking world at the same time as he tells tales out of school. Not only that, the tales he’s telling — acerbic, embarrassing, often, seemingly, absurd on their face — are not written for the angry hoi polloi or even for the schadenfreude set, but quite for the insiders, his own clients and colleagues whom he is raking over the coals. And, indeed, it is hard not to believe that, after reading Knee’s assessments, many of these colleagues and clients don’t, however ruefully, appreciate how much they screwed up.
In an age of speaking past each other, Knee somehow manages to speak in a voice, blunt, wry and affectionate, that the people he is speaking to understand. Once, I called Knee for a comment about a particular media company on the ropes, and he characterized their executives, in exuberant language, as extraordinary dopes, asking me please not to quote him by name. I did not, of course. But it didn’t matter, for days afterward various colleagues and clients of his would say to me, with the businessman’s version of a giggle, “that was Knee, wasn’t it?”
This is a particular order of criticism, a largely absent kind, when the people you are criticizing recognize you and trust you — indeed, actually enjoy you. And it uniquely transcends the ultimate modern criticism of criticism that nobody knows what they are talking about. Jonathan Knee, is not just the only beautiful writer about business who has actually spent a career doing business, but he is one of the few modern critics not at bitter odds with his subject. That’s a model not just for understanding the nature of bad deals, but of finding common ground.