Monday, July 5, 2004

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Life lessons from Robert Rubin

Over the past few weeks I've been slowly reading Robert Rubin and Jacob Weisberg's In an Uncertain World: Tough Choices from Wall Street to Washington. The style of Rubin's memoirs perfectly match his deliberative demeanor. I'm not finished yet, but so far there are two things worth singling out as tips for those who aspire to pominent positions in their lives:

p. 54: "Anyone who is honest about having done well will acknowledge the enormous role played by chance." To some this statement might be so obvious as to appear banal -- but as someone who's digested more than their fair share of memoirs, this might be the first time I've encountered an "eminent person" actually saying it out loud. I strongly suspect that many who have reached Rubin's stature believe that their success has little to do with luck and eveything to do with their own diligence, brilliance, piety, or strategy. It was nice to see -- and thoroughly appropriate from a man who lives by the princple of expected value theory.

2) In recounting how his career progressed, Rubin goes into detail about what he did at Goldman Sachs. However, he also thinks that his non-profit and charitable activities were essential to advancement (p. 85):

You can draw a... straighter line from my joining the board of ABT [American Ballet Theatre] to subsequent opportunities, because being on the board of an arts organization caused people to view me as someone who was involved in civic activities.... And so it went, with one involvement leading to another. The key was to get in motion to begin with.....

[O]utside involements added other dimensions to my life, providing a glimpse of what other people's jobs and lives were like and an opportunity to contribute to purposes beyond my work. What's more, outside involvements helped my Goldman Sachs career, as I met well-established people who were also clients or potential clients of our firm.

I've read a few other biographies that point to the same synergy between civic involvement and career advancement. Some might argue that this is an example of slef-interested behavior wrapped in the guise of acting the do-gooder. Me, I think tt's nice to see that it is possible to do well in part by doing good.

posted by Dan on 07.05.04 at 11:02 AM


I think that's only partially true. If Mr. Rubin had devoted his volunteer efforts to something not politically correct such as the Boy Scouts I very much doubt it would have worked.

posted by: Brad Osburn on 07.05.04 at 11:02 AM [permalink]

“If Mr. Rubin had devoted his volunteer efforts to something not politically correct such as the Boy Scouts I very much doubt it would have worked.”

I have ordered Robert Rubin’s book and should receive it before the end of the week. It is very doubtful if he would have helped his career by not being politically correct. Joining the Boy Scouts would have indeed been a career killer. However, this is the question I want answered: what in hell is Rubin doing in the Democrat Party of 2004? How can he delude himself that the free traders and economic growth advocates possess the determining influence? I’m convinced that Rubin’s arch enemies control the action. Am I wrong---or is Rubin a Democrat merely because it’s the cultural thing to do? Is he being played for a fool?

posted by: David Thomson on 07.05.04 at 11:02 AM [permalink]


If you want a fuller version of the "chance makes us" thesis, look at Taleeb's book. I think it's "Fooled by Randomness." The guy's more than a little egomaniacal, and the writing style can be painful, but he's another successful guy who is willing to admit that fortune follows luck. I think you could also make the argument that Warren Buffett has acknowledged as much. In the estate tax debate, IIRC, he acknowledged that it was luck, in part, that made him so good at profitably deploying capital, and luck, in whole, that placed him at a time when that is a valuable skill.

And (serious question - not snark) isn't it this acknowledgement of the importance of luck, particularly as regards initial conditions, that underlies the liberal belief in safety nets (or gov't insurance)? To the extent that you buy Rubin's thesis to some depth, shouldn't you buy the safety net arguments? I understand that the extent of the safety net remains debateable, but shouldn't the basic program be all but beyond question by now?

posted by: SomeCallMeTim on 07.05.04 at 11:02 AM [permalink]

Dan--Thanks for reminding me of Rubin/Weisberg and of those points.

As I understand it, some law firms (perhaps most) encourage and often require outside involvement in order to drum up business. Rubin is merely enunciating a familiar principle here (heck, Harvey Mackay beats it into his readers' heads every chance he gets).

As for the "Boy Scout" argument: Hmm, do you think that maybe joining the elite world of the ABT might offer bigger chances for an investment banker than the ur-bourgeois Boy Scouts?

posted by: Paul on 07.05.04 at 11:02 AM [permalink]

I agree that luck plays a role, but let's not take that too far. As the former baseball executive Branch Rickey once said, "luck is the residue of design." If you prepare yourself and work hard, you are much more likely to be "lucky" than if you just screw around. Of course, the level of success you can expect is influenced by your natural attributes, so certainly good fortune plays a large part. Do you really think that a guy like Rubin would not have been successful without good fortune? Maybe not to the point that he is, but I have to believe he would have done ok anyway.

posted by: MWS on 07.05.04 at 11:02 AM [permalink]

But be careful, here, please.
Let's not fall into the trap may liberals, such as Rubin, publicly fall into... that is the idea that luck is the only reason for success.

If you'd like a demonstration that luck isn't really needed, let's look at people whose luck has turned around.... they've been poor all their lives... and then won the lottery.

The stats for such people, show an amazing percentage becoming poor again in a matter of years.... their attitudes about wealth..(note I didn't say 'money') never changed.

posted by: Bithead on 07.05.04 at 11:02 AM [permalink]

I appreciate Dan's thought, but am curious as to how he defines the parameters of this concept we call "doing good."

I'm not against ballet, and I think civic activities generally can be very worthy things. They aren't charity, though; no one would go hungry or sicken and die without the American Ballet Theater. I'm not knocking Rubin or denying that along with his civic activities he also did genuine charity work (or at least gave money to people who did). I just think it's useful to recognize distinctions between different kinds of activities outside the workplace.

posted by: Zathras on 07.05.04 at 11:02 AM [permalink]

I believe I read an article in Fortune magazine
a number of years ago on how "lucky" breaks helped
a number of different businessmen. I cannot
remember the date of that particular issue.

Also, didn't Napleon once proclaim that "chance
favours the prepared"?

Being able to take advantage of an opportunity
can make a huge difference.

posted by: pragmatist on 07.05.04 at 11:02 AM [permalink]

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