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Monday, June 3, 2013

David Brooks, "The Way to Produce a Person": And a Person is . . .?

Benghazi, the IRS, AP/Rosen? Heck no! David Brooks appears intent upon avoiding these topics like the plague, except to the extent that Benghazi tarnished the reputation of his friend Victoria Nuland (see: Instead, Brooks, in his latest New York Times op-ed entitled "The Way to Produce a Person" (, discusses an article in Sunday's Washington Post ( about an MIT graduate working for a high-frequency trading hedge fund, who donates much of his income to fight malaria. The student believes that for every $2,500 that he gives away, one person can be saved from this mosquito-borne disease. Brooks cautions this young man:

"First, you might start down this course seeing finance as a convenient means to realize your deepest commitment: fighting malaria. But the brain is a malleable organ. Every time you do an activity, or have a thought, you are changing a piece of yourself into something slightly different than it was before. Every hour you spend with others, you become more like the people around you.

. . . .

Second, I would be wary of inverting the natural order of affections. If you see the world on a strictly intellectual level, then a child in Pakistan or Zambia is just as valuable as your own child. But not many people actually think this way. Not many people value abstract life perceived as a statistic as much as the actual child being fed, hugged, nurtured and played with.

. . . .

Third, and most important, I would worry about turning yourself into a means rather than an end. If you go to Wall Street mostly to make money for charity, you may turn yourself into a machine for the redistribution of wealth. You may turn yourself into a fiscal policy."

Brooks's conclusion:

"If your profoundest interest is dying children in Africa or Bangladesh, it’s probably best to go to Africa or Bangladesh, not to Wall Street."

I also read this Washington Post article with avid interest, given that some 35 years ago, I was working for a leading Wall Street law firm in the field of mergers and acquisitions and also giving my money away to charities. I won't bore you again with my history: I ate the bad pizza and left the firm. Regrets? No. I recall the dialogue from the 1982 science fiction classic "Blade Runner" in which Dr. Tyrell explains to one of his robots why it must "die":

Tyrell: The light that burns twice as bright burns for half as long - and you have burned so very, very brightly, Roy. Look at you: you're the Prodigal Son; you're quite a prize!

Batty: I've done . . . questionable things.

Tyrell: Also extraordinary things; revel in your time.

Batty: Nothing the God of biomechanics wouldn't let you into heaven for.

Owing to my peregrinations after leaving the Wall Street law firm, I also saw where some of my donated money from years past had been going, and I was not satisfied with the destination. It was not what I had fantasized.

Do I have qualms about the "lifestyle" of the MIT graduate? Sure, but they are different from those of Brooks, who seems most concerned by the corrosive effects of this young man's chosen way of living.

I detest the behavior of most hedge funds and see no value in high-frequency trading. I always believed that securities exchanges provided the means for new companies to raise capital, create jobs and bring to market new products, some of them life-saving. Today, when you are buying or selling shares, there is a good chance that the party on the opposite end is a computer, whose algorithms don't take into account the worth of what any public company is seeking to achieve or whether such trading can be destructive.

How important are corporate goals? After all, public companies are driven by profit motives. True. On the other hand, I have seen the painfully slow pace of university research, and this is not the driver of innovation that many people think. People might feel "good" about contributing to university research, which can indeed be important, but in my experience, such donations are not the best way to achieve desired tangible results.

Public companies can be wasteful and indifferent to their shareholders? Absolutely, and this is why I am no longer willing to invest passively. If I invest at all, it is premised upon active involvement in a company's affairs. Needless to say, most companies don't want this, and consequently my "portfolio" is extremely limited. In addition, such involvement imposes severe restrictions upon my ability to trade in such a company's securities, but this is a price that I am glad to pay.

Bottom line: I'm certain that the MIT graduate is doing much good, and it's a pity that there are not many more people like him. Far be it from me to lecture him on how "to produce a person." (Given my often childlike behavior - ask my kids - I am embarrassed to say how old I will become on Saturday, yet pleased to acknowledge that I am still "morphing.") On the other hand, given this young man's talent and commitment, I am confident that if saving lives is his ambition, it can be achieved more effectively and efficiently than by working for a hedge fund and making donations.

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