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Money is Our Last Great Taboo

 

In January 1987, at the age of 22, I was hired by the First Boston Corporation at the rate of $18,000 to be an assistant in the San Francisco office of the bond department, Taxable Fixed Income Sales. Within a week I was placing a half billion dollars a day of client money into short-term funds, and within months I was the resident expert in modeling newfangled derivative mortgage bonds on a finicky computer system I nicknamed the Ronco Mortgage-o-matic -- "It slices, it dices, and nobody but me seems to be able to get it to work." But no matter how exotic my responsibilities, I never forgot what was the most important line item in my job description.

Other assistants weren't expected at the office until 6 a.m., shortly after trading opened, but I was there every day at 5, before most salespeople had arrived. The first thing I did -- even before starting the coffee or slipping out of my running sneakers and into my loafers -- was go in the Trade Entry room and tear off the daily update of the monthly sales report, which had been sent to this 17-inch-wide, upright line printer from a server in New York and had spit out overnight on green-and-white-striped, two-ply computer paper. The report printed twice, and I took both of them off into a lonely corner. With the first copy, I tore off each salesperson's several pages and delivered their portion to their foxhole desktop, usually into a cubbyhole they felt private and secure about, where nobody else could steal a glance. With the second copy, I divided the two layers of paper into separate reports, and put one on the desk of the office's managing director, and one on the desk of the sales manager.

The report stated exactly how much commission each salesperson had earned that month. That fiscal year, salespeople's incomes varied from $850,000 to $240,000. Only three people in that office of 60 were entrusted with the information: the two men who ran the place and me, a 22-year-old kid who owned only one suit and hadn't had his shoes shined since he bought them.

On the occasional day something caused me to show up a little late and, God forbid, I arrived at 5:45, after trading had started and salespeople were dropping off trade receipts in the Trade Entry room, an action that caused them to walk within a few feet of the precious report -- I got a stern glare from the sales manager as I delivered the report, a glare that clearly asked, "What if someone had seen the report?" In 20 months of work, I never took a day off or missed a day sick.

What was particularly odd about the secrecy of the report was that this was finance in the '80s, after all. Nobody had to feel guilty about earning half a million dollars at the age of 31. In fact, it was quite common for salespeople earning half a million dollars to complain that they were underpaid. The market mantra was "Everything has its price," and this was said with pride, so there was no shame in having sold out the best years of your life for a big wad.

In addition, most of a salesperson's commissions were earned on new bond issues, and trading of new bond issues occurred over an international public address system called the squawk-box, or the Hoot 'n' Holler. So when a heavy hitter dropped 200 mil on Bank of America, everybody in First Boston's offices around the world knew exactly how much commission he had pocketed for the sale. So why, oh why, was the sum of these instances, the total of what people made, such a guarded secret? Why, when everybody was rich, did it matter just how rich you were?

I was entrusted with this secret information on my first day. The sales manager was in the office at 5. He could have taken the report himself, but he probably didn't want to be seen doing something so menial as tearing reports off a printer. There were other assistants who had been at the firm 15 years and had seen everything -- layoffs, instant riches, betrayal -- they surely wouldn't even blink at the earnings numbers. But instead I was chosen. There was something about me, something that must have come out in that first interview. How do I know that I wasn't just chosen randomly, or handed down the duty by some assistant who didn't want to show up an hour early? Because it had happened before. It had been happening my whole life.

In June 1978, at the age of 14, I was hired by the Millstone restaurant at the rate of $2.35 an hour as a busboy for the summer. The Millstone was a high-volume soup 'n' sandwich shop on First Avenue in downtown Seattle, near Pioneer Square, and this was my second summer clearing tables. Most of the 15 employees were college-educated actors and actresses, and top wage -- cashier's wage -- was $4.25 an hour. I know this because after I'd been there a couple of weeks, the owner chose me as the person to pass out paychecks. Two of the women working there, both sandwich makers, were from Harvard. It must have been humiliating to have attended the oldest American university, then come to the Emerald City and landed good roles in the Intiman Theater's production of an Edward Albee play, and to read high praises of your work in the Seattle Times, all the while getting paid $2.85 an hour to make ham & Swiss. How much more humiliating was it for your paycheck to be handed to you by a cherubic eighth grader who spent his own $2.35 on dope and video games?

I was entrusted with these people's painful secret, and I did a better job of it than the owner, who no doubt hated that twice-monthly ritual of confronting the very people she was so grossly underpaying. As I learned over the summer, paytime had historically been the occasion when all sorts of brewed resentment would boil over, resulting in raise requests and, when they weren't granted, quittings. Paytime had been a sort of showdown at the Millstone corral. But when I took over, the emotions calmed. Turnover dramatically eased. A simple measurement of employee anger -- the number of dishes broken per week -- also went down.

I had a gift. I didn't make people go weird around money.

So obvious was my gift that even the owner soon entrusted me with her money. I was given the title Assistant Manager and a 10-cent raise and at the end of the day, I cashed out the cashiers and totaled their receipts to learn the day's take, which I then walked down the street and deposited into our bank account. I was a math whiz, so I never made a mistake transposing numbers. It turned out that even the owner was uneasy with money, uneasy with knowing how much she had earned, and the daily totaling had been a hugely dreaded stress that sent her home twisted up and churning with consternation. Whether the take was as low as $600 or as high as $1,100, it was a whole lot easier for her to learn it from me. No longer so uptight, she was less likely to fire someone and more likely to dole out her dime raises without fear that her mortgage payment couldn't be met.

People often ask me why it is that they feel so relatively comfortable talking about money with me, and when they push the question I give them what sounds like a plausible answer: Once you've had a half billion dollars go through your hands on a daily basis, no amount of money impresses. Also, after my 20 months at First Boston, I was offered a position as full salesman, with a starting draw against commission of $300,000. My alternative was attending the writing program at San Francisco State, to which I'd recently been accepted. I tell people that once you've looked 300K in the eye and turned away, money will never have talismanic power over you again. But the truth is, turning away from the 300K was easy, because money had already lost its sway.

I grew up with money. I don't mean we had wealth; I mean that money was always a factor. I grew up with money the way our generation grew up with television -- always on in the background. Mom was constantly threatening that my two brothers and I were going to eat her out of house and home, and to avoid this fate certain favorite foodstuffs had to be rationed: two slices of bologna a day, two slices of American cheese, one glass of juice, two glasses of milk and one big bowl of unsweetened cereal. At the grocery store, we knew not to ask. When I moved in with my father during high school, the manufacturing company that he had bought out of bankruptcy had returned to bankruptcy. He had to be a Houdini with money. He leased a Jaguar, but we had to pay the phone and energy bills in cash. We rented a boat in the Canadian San Juan Islands for two weeks every summer, but on the day before my high school graduation I learned that for two years nobody had paid the school tuition, and I wouldn't graduate. So I've never had the luxury of keeping money matters at a distance. I've never had the luxury of not knowing. I've always been cut in on the deal.

I suppose what I have is similar to the human clinicalness with which doctors go about examining our bodies. It's an oxymoronic bearing, one that simultaneously conveys 1) a detached indifference, a nothing-shocks-me ease, and 2) a deep, knowing respect for how sensitive this may be to you. In other words, though I am utterly indifferent to how much you earn (no matter how much or how little), I am wholly sympathetic to how much your income matters to you.

I have become the equivalent of the plastic surgeon who specializes in boob jobs; I don't embarrass people or make them feel guilty for wanting as much as they can get. I exude no resentment, no jealousy. I don't want some of theirs.

This is why rich people like to hang out with equals -- there is no undercurrent of jealousy, which eats at the foundation of a relationship slowly, like termites. The taboo of money perpetuates what is left of a class system in America. It's just easier to hang out with people of your tax category. In those very American instances where one person in a social group has a lot of money but the others don't -- a common occurrence in Silicon Valley, for instance -- this is handled two ways, opposite but equal: It's either completely ignored, and the rich one staunchly lives to the standard of his friends, or the income disparity is constantly joked about and noted, which is a way of consistently releasing the pressure.

In Silicon Valley, where more money is being thrown around than anytime anywhere in history, being motivated by money is almost socially acceptable. Almost, but not quite. When I ask people in Silicon Valley what motivates them, the conversation usually goes like this:

1. The product they are working on must fit loosely into their value system. For an animator, "Movies are often meaningful." For a manager at an Internet service provider, "E-mail is an instantaneous communication, nearly telepathic in quality, which raises the cosmic consciousness of society."

2. That said, they are working such long hours because this is a once-in-a-lifetime chance to make a hell of a lot of money.

3. They don't know what they would do with the cash if they got it. It's not the money itself they want, it's the win, the victory. And the amount of money is an unbiased, market valuation of the size of the win. The money would free them from ever having to think about money.

That's why stock options are the perfect "compensation delivery system" -- added up, they amount to a lot of money. But you can never quite tell just how much money you're talking about. The stock price moves up and down, so the amount you're in the black varies daily. The options have different exercise prices, and you have to account for the tax liability, and the capital gains rate could change at any time, etc. And since you can never pin down exactly how big is your victory, you never have to admit that you should probably stop working so hard. If unease about being so rich ever creeps in, you just remind yourself that at any point the company could go up in smoke.

The other day I interviewed a guy in Silicon Valley who goes by the self-anointed nickname "the Babysitter." He carries a teething rattle in his briefcase and has been known to pull it out in the middle of negotiations when he feels like the people he's talking to are being crybabies, which happens all the time. He is a management consultant who specializes in high-tech mergers, which usually involve some bootstrapped startup being absorbed by a well-oiled marketing machine. Startups are often run "open book," so the staff knows exactly what everyone makes, which isn't much. Even though post-merger they will be getting generous raises, the most common whine the Babysitter hears is the insistence, from some recalcitrant programmers, that they be told what everyone else is making. They want the fairness to carry into the corporate environment, which, according to the Babysitter, "ain't never going to happen."

According to a recent Wall Street Journal column, sharing salary information -- running more open-book -- is a common management tactic when times are tough. Rather than offering a raise, companies offer a sense of parity, a sense of fairness: "The pay may be bad, but at least it's equitable." And when times are good, as they have been the last few years in this country, employers keep their employees in the dark. They'll offer you 4-percent raises year after year and hope you don't find out that your recently hired co-worker was lured away from his last job with a 30-percent raise.

For my first novel, "Bombardiers," which was a satire of the financial industry, I concocted a publicity stunt whereby we issued a prospectus, hosted a trading party and sold shares in my book. It was my way of satirizing the publishing business, which of course subjects all books to the mercy of the market simply by shipping them to stores. But the satire in the scam completely went over the head of the publishing industry, which had a knee-jerk reaction -- they were appalled by my gall. There in the prospectus were exact dollar figures of what each foreign publisher had paid to me. How could I! My British publisher so thoroughly enjoyed the stir of my prospectus that it duplicated the scam over there. However, the plan got leaked to the British press, which didn't seem to even understand that it was a publicity stunt. They thought Secker & Warburg was actually going to raise money to publish my book, and a prominent editorial ran in the Independent, decrying the state of publishing, when even the great publisher of two consecutive Booker Prize winners, Roddy Doyle and James Kelman, didn't have enough money on its own to publish my novel.

Despite this show, what editors and salespeople and publicists earn in publishing is of feverish concern. Every year Publishers Weekly publishes its salary survey, and this is the one issue that rarely makes it past the third name on the corporate routing list, and it's the one most seen being taken to the office copier. They desperately want to know what they're worth, but they don't want anyone to learn they're overpaid, which would hatch resentment. Even worse would be if people found out you're underpaid, as if you've been too wimpy to stick up for yourself.

I have conducted a couple experiments in "open-book" management, where the flow of money is public. The most notable of these was in 1993, when I was associate publisher at the literary publisher Mercury House. Mercury House published about 18 titles a year with a staff of six, and my main responsibility, as usual, was to handle the money. For several years, the organization had been subsidized by its owner -- subsidies of some form (even if it's free labor) are necessary for 95 percent of publishers devoted to literary merit -- and we had made the decision to become a not-for-profit, replacing the owner subsidy with grants.

In order to learn what other not-for-profits were paying authors and staff, I called several that I knew and asked for their financials. Not-for-profit publishers are required, by tax law, to make their financials public. But I was met with resistance and foot-dragging. They couldn't believe I had the gall to ask. They just had a hell of a time giving up their Form 990s to someone they knew personally, someone they went to parties with at the American Book Association. It was like going to a nude hot springs -- it's easy to get naked in front of strangers, but not your friends.

The Mercury House transition was going to be painful, because for two or three years -- while applying for tax-exempt status -- we were going to have to survive without subsidy. We were going to have to cut back on hours and pay, and the only way I could see doing this without ruining morale was to open the ledgers, so everybody could see that they weren't the only one taking a hit. We were going to get salary-naked, and the first months of it were excruciating. But every two months we tightened the belt, to the point some of us were working only two days a week. We were like those African ladies in National Geographic who stretch their neck by adding another necklace each year.

Why are people so secretive about what they earn? In high school, I was often a busboy in nicer restaurants, and I knew waitresses who refused to become hostesses, even though the hostess position paid more and was far less work. They liked that their income came in tips, so not even the boss knew quite what they made, and that was a form of freedom that more than compensated for being the slave to diners' obnoxious requests.

Income is the last taboo. Last October, a 1,600-word article of mine ran in Forbes ASAP, in which I confessed how often I dropped acid in college. I got no calls or e-mail in response to the article. Then, a few weeks ago, the October 1997 issue of Forbes ASAP arrived, devoted to what people earn in Silicon Valley. Somewhere in there was buried a single paragraph about me, reporting that my income last year was $170,000. The day it arrived in the mail, I got nine e-mails and five phone calls, all saying, basically, "Hey, I saw you in Forbes!" Nobody mentioned the $170,000. They couldn't. They wanted to, though. One of the calls was from my father, and not only had he seen it, but four friends of his had already called him about it.

Did your eye stall in the last paragraph when you saw the $170,000 figure? Did you read the sentence twice? Did you call out to your office mate, "Hey, Bronson takes me to lunch next time"? Did it make you rethink your impressions of me from this article, that it's easy to be nonchalant when you've got it? Are you craving further voyeuristic elucidation of my finances? If any of that is true, it's just confirmation of how hot this button can be. Since the publication of the Forbes article, it's been awkward to do business with friends, and anyone I do business with is a friend. It's like when people say, "Don't think about elephants" and all you can think about is elephants. They're thinking, one hundred seventy thousand dollars. One hundred seventy thousand dollars. One hundred seventy thousand dollars. The figure may be higher than they thought I make, or it may be lower, but that's not the point -- the point is, they are flush with giddyness. They know my secret and I don't know theirs.

Money is a great taboo among writers. Book deals are usually announced as five-, six- or seven-figure contracts, and that's as specific as it gets. Particularly with books that have literary aspiration, to get any more specific risks a queasiness, a fear of taking attention away from the manuscript. Authors are often in very tough jams. They get an offer, and they kind of have a sixth sense to second-guess their agent (a sixth sense keenly honed by reading Publishers Weekly reports of unknown first novelists getting six figures), but the last thing they want to do is appear fixated upon money -- they're authors, after all, supposed to be wholly devoted to The Word. Do they challenge their agent or do they swallow their pride? What do they do?

They call me. They've heard from someone about my gift. They've heard they can be open with me and not regret it. Most commonly, I get called when an author is considering an offer for world rights, rather than just North American rights -- what's that worth? The other common one is weighing two paperback options -- $50,000 vs. half royalties (royalties to be split with the hardcover publisher), or $30,000 vs. full royalties (when the hardcover publisher is making the offer itself): Which is better? I also get plenty of calls from authors being published by small presses, wondering if their $4,000 offer is high or low in that world (it's on the high end).

I can take the news without flinching, not just about your money, but also about mine. My book editor shares with me weekly shipping statistics from all Ingram warehouses. He shows me my novel's profit and loss statement. I'm still always cut in on the deal. As my film agent said to me recently, "You're one of the few authors who doesn't make me lie to him."

The offices of First Boston were filled with investment bankers who could be brutally clinical informing a customer that their arbitrage, just put on minutes ago, had already lost 20 grand. But these same bankers were terribly guarded with the market valuation of their own annual worth. Twice a year, in February and August, the firm "settled up" with the sales force, awarding six-figure checks, so-called "bonuses," which amounted to the difference between their earned commissions and their monthly draw. I have never seen such wealthy people so unable to celebrate, so unable to muster anything but anxiety. No matter how much that check was written out for, there was something belittling and disparaging about one's worth being reduced to a number, down to the penny -- a small computer-generated piece of paper stating who you are, and all you are.