Steven Rattner is the social-climbing financier who resigned as auto czar because his private equity firm is embroiled in a pay-to-play scandal. Everyone's waiting for shoes to drop, but New York says Rattner's biggest problem is that nobody likes him.
Steve Fishman's profile of Rattner, for which the Quadrangle Group founder did not submit to an interview, is a fairly astringent psychological assessment of the New York Times reporter-turned-banker as a calculating overachiever whose desire for power is frustrated by the fact that he's a cold, distant, and has no real friends. Which is pretty much what we'd imagine of anyone who once dated Judith Miller. But while Fishman's takedown seems devastating, it basically lets Rattner off the hook for his involvement in a scheme to pay off consultant Hank Morris to drive New York pension fund business to Quadrangle, portraying the deal as poor form rather than illegal. Rattner is credited with a masterful capacity to snow reporters, owing to his having been one himself. Whether he applied those powers to New York or not, he certainly got what he wanted: The first major profile since his sudden and still-unexplained resignation waits until the very end to get into the stuff about how Rattner paid a middleman and granted a movie deal to the deputy comptroller's brother-in-law in order to get his hands on pension money, and downplays the significance of the charges.
More interesting to Fishman (and still interesting to us), is the stuff about how everyone thinks Rattner is an arrogant prick. "In some weird way," a colleague told Fishman, "he kind of knows that once you get to know him, you won't like him, and I don't think he cares. Which is really useful if you want to get ahead."
Why wouldn't you like someone who decided, when he was a reporter at the Times, that he deserved the status, power, and money that had been acquired by the idiots he covered?
"It begins to get on you after a while that [as a journalist] you are writing about people who have more power than you, more influence and more money, and are not any more capable," [Rattner's wife] told The Washington Monthly. "Why in God's name are you trailing them around the world and writing about them when you are smart enough to make the money and have influence commensurate with theirs?"
Sounds like a great guy. Rattner has apparently struggled all his life with the fact that he's a dick, and even undertook the help of a professional to help people like him more.
At Quadrangle, colleagues had confronted him about his manner. He was distant and haughty and they didn't like it. So Rattner hired an executive coach, Art Gingold, and worked with him for a couple of years until he left for Washington. It was essentially a likability course. "He took to the feedback as diligently as anybody I've coached," says Gingold, who declined to discuss personal details. "He studied, almost memorized it. He really took it to heart." Gingold helped Rattner change his behavior, and gave him pointers. Now Rattner walked down to people's offices. In meetings, where he'd been business-only, he now opened with, "Good morning, how was your weekend?" He took junior people to lunch. "It sounds simple and obvious, but wasn't [to him]," says Gingold.
The whole, "How was your weekend?" trick opened doors for Rattner, and he eventually landed his dream gig: Helping America (after enriching himself to the tune of up to $600 million) by working for the government on Barack Obama's auto-bailout team. But even better than the job was the fact that, finally, he might make some real friends! It was like moving to a new high school:
While upending the car industry, Rattner tried out his new personality skills. This was a fresh start with people who didn't yet have a view of him, he told a friend, and he fought his tendency to be cool and remote. He was proud of himself; the guys really seemed to respect and to like him.
So even if he had to resign under a cloud and might even end up under indictment, at least Rattner got some personal validation out of the deal. Which is better than the investors in Quadrangle got: The most damaging tidbit in the story is the fact that for all his wealth, his publicity, his friendship with Arthur Sulzberger, and his reputation for extraordinary competence, Rattner's fund does no better than municipal bonds:
Quadrangle's annual statement from 2008, a copy of which was obtained by New York, shows that after eight years, investors in the first $1 billion fund had just about got back their initial investment. There was still considerable "unrealized value," as the illiquid assets are called, and if you add that in, the returns beat a poorly performing stock market over that time, though they still wouldn't have outperformed a municipal bond. "We've had lots of investments that have disappointed," says Damon Mezzacappa, a former vice-chairman at Lazard and an investor. "Quadrangle was okay, not great."