This year, graduation rituals at most colleges have been cancelled, postponed, or relegated to online ceremonies. It's a loss. Commencement speakers are like political conventions (which are also in pandemic-induced jeopardy) in this way: Although they generate almost no suspense, the words and atmospherics surrounding them tell us a lot about the ever-changing society we live in.
Thirty-four years ago today, students at the University of California's Haas School of Business, along with their families, professors, and close friends, gathered for the presentation of master's degrees. The main speaker was someone the students had chosen themselves. And so it was that 49-year-old corporate raider Ivan Boesky, looking tanned and self-confident, strode to podium.
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The product of a Russian-Jewish family from Detroit, whose father had owned a trio of topless bars, Ivan Boesky attended a series of colleges in Michigan before making two decisions that shaped his life. First, he married a woman named Seema Silberstein, who also had an entrepreneurial father. The difference was that Ben Silberstein owned tens of millions of dollars of Detroit real estate as well as the Beverly Hills Hotel in Los Angeles. Boesky's second fateful move was moving to New York and, with a generous stake from his father-in-law, opening a Wall Street trading firm that specialized in risk arbitrage. By 1986 he'd amassed a fortune, estimated at $2 billion, largely by betting on stock price fluctuations in corporate takeovers that he either predicted or precipitated. Boesky always seemed to be on the right side of these outcomes, good fortune he attributed to his own shrewdness. Actually, "Ivan the Terrible" was delivering briefcases full of $100 bills for inside information. He would soon pay hundreds of millions of dollars in fines to the government and serve two years in prison -- a sentence that would have been longer had he not agreed to wear a wire and rat out his friends and colleagues, including Michael Milken.
Those revelations would start emerging before the year was out, but on May 18, 1986, Boesky was known mainly as an audacious corporate raider. And the future titans of Wall Street and Silicon Valley graduating from Cal's business school wanted to know his secrets. He did not disappoint.
"Greed is all right, by the way," he said at one point in his talk, pausing for effect. "I want you to know that. I think greed is healthy. You can be greedy and still feel good about yourself."
With that, the audience erupted in cheers and applause.
The following year, as Boesky's stunning fall from grace was taking place, the sentiment he expressed in Berkeley was expanded upon by the fictionalized Gordon Gekko in the Hollywood hit "Wall Street." Played by actor Michael Douglas, Gekko is rationalizing to shareholders why breaking up the fictional Teldar Paper company is a socially responsible act.
"I am not a destroyer of companies -- I am a liberator of them!" he says "The point is, ladies and gentleman, that greed, for lack of a better word, is good. Greed is right, greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed in all of its forms -- greed for life, for money, for love, knowledge -- has marked the upward surge of mankind. And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the U.S.A."
This entire soliloquy, and Ivan Boesky's commencement address at Cal, have been rendered simply as "Greed is good," a process called "bumper-stickering." As quote maven Ralph Keyes notes, "Memory may be a terrible librarian, but it's a great editor."
But not always a great editor. The moral of the story in "Wall Street" -- and Ivan Boesky's life -- is that greed is bad, which is also a sentiment found in most of the great philosophies of the world, and in the Bible.
Moreover, what both Ivan Boesky and Gordon Gekko were articulating was a more subtle point, and a sometimes disturbing one. They were saying that the engines of dynamic capitalism depend on men and women who will become fabulously rich, and that this -- at least in part -- is what drives innovation, job creation, and, by extension, American prosperity.
And not only in America. Today, virologists and medical researchers all over the world are searching for effective drug treatments to this horrible new coronavirus as well as a safe and effective vaccine. These scientists' quest is driven by a complicated set of reasons that include altruism, ambition, competitiveness, and intellectual curiosity. And, yes, also the potential of monetary remuneration. Success implies billions of dollars in profits for companies and individuals who succeed. Few people would begrudge them the money. And in this case, Boesky's original words would convey a literal truth behind them. Greed itself may not be "healthy," but its motivating qualities can assure the health of the rest of us.
Carl M. Cannon is the Washington bureau chief for RealClearPolitics. Reach him on Twitter @CarlCannon.