After it was revealed that Richard A. Grasso, once the chairman of the august New York Stock Exchange, had made an unseemly amount of money -- in other words, almost as much as his bosses -- a lawyer was hired and an investigation was launched, which proved, to my immense satisfaction, that his greed knew no bounds. His willingness to spend other people's money extended even to his secretary, paid $240,000 a year, and to his two drivers, each paid $130,000, and probably, for such is the custom, entitled to take the car home with them at night. Grasso is the face of corporate America. Put it on the $100 bill.
I have written before about the sainted Grasso and admitted that he is my hero. I confessed this even before the report prepared by Dan K. Webb, a former federal prosecutor, was recently made public by court order. Now that we know the full extent of Grasso's heroic sense of entitlement, my admiration for him grows by the storied leaps and bounds -- and throw in a scissor step. Here is a man who watched others make obscene amounts of money and figured that he could do the same. A little applause, please.
The critical difference between Grasso and his bosses, we are always reminded, is that he was running a nonprofit organization and his members, the banks and brokers of Wall Street, were not. It is this nonprofit status that has engaged the New York state attorney general, Eliot Spitzer, who has sued Grasso, pointing out that under the law, executives of nonprofit corporations are supposed to receive only "reasonable" compensation. For some reason, Spitzer considers Grasso's $139.5 million payout in 2003 to be unreasonable. Go figure.
Now let us turn our attention to the payout James Kilts is going to get. Kilts is the chairman and chief executive of Gillette, which he recently sold to Procter & Gamble, ending 104 years of glorious razor blade history. According to the Wall Street Journal, Kilts will realize more than $153 million from the deal -- and that does not include his $1.2 million-a-year pension. Some of this money comes from the value Kilts supposedly added to the Gillette stock and so, in the tradition of American business, more power to him. But some of it -- $23.9 million, to be precise -- is what the Journal called a "one-time sweetener from P&G," and an additional $12.6 million is a "change in control" payment. Add it up and Kilts got $36.5 million for selling King C. Gillette's little company to P&G -- and, in the process, eventually eliminating some 6,000 jobs. I bet those workers will not be getting a "change in control" payment.
In some of the stories about Grasso, it is mentioned that he hails from Queens, which is the new Brooklyn. The borough represents grit and street smarts, and a deep understanding that the books are cooked and you cannot beat city hall. This impression would only be strengthened by running an institution such as the stock exchange, whose board then consisted of people who would probably think Kilts got a bad deal. Most of them made unseemly amounts of money -- and so did their drivers.
Spitzer and others say Grasso hoodwinked his board. Maybe. But the board consisted of tycoons and CEOs of one sort or another -- the chairman of Goldman Sachs, for instance -- and since I, too, am from Queens, it's my atavistic sense that his board was not so much fooled as unimpressed. The numbers must have meant little to them, accustomed as they were to the sort of compensation packages that, in a more reasonable age, got Louis XVI dragged to the guillotine. As for Grasso, he was only playing the game he had been taught, couching excess and greed in fancy terms such as "change in control." He had invented nothing, created few to no jobs and produced little to no wealth. In that, he was little different from the people around him. Why me? he must wonder. 'Tis a sad story we tell.
The Wall Street area should have a Grasso Square with a statue of Richard for both public edification and as a perch for weary pigeons, two good causes. In an age of excess, he was excessive. But his worst sin was not knowing his place and embarrassing the even-richer men who employed him. For that he will suffer -- a martyr, my hero and a man without a driver.
cohenr@washpost.com
