poverty(–michaelgrossinterview–362962012( ag(00:00:07(all ... ·...

Poverty – Michael Gross Interview – 3-‐29-‐2012

1 of 39

AG 00:00:07 All right, so here’s how we’re gonna do it. We’re just gonna have a conversation, and we can go back and forth, like I said you want to go with notes we’ll do whatever. But tell me first what was it that engaged you to want to write this book, first? I mean way back in the day why did you want to write it?

MG 00:00:29 I started out with a completely different book in mind. It was a book where I was gonna take one American family that came on the Mayflower and follow them from then until now, and my publisher at the time said but nobody cares about WASPS anymore, and we had a argument about that, that ended with her saying I’ve been to. I asked her if she knew who owned the real estate on the Northeast along the ocean, and she said I’ve been to East Hampton, it’s all Jews and I said well, East Hampton isn’t America, but the conversation degenerated from there and her advice, which was actually good advice despite the oddity of the conversation, that led up to it. It was social history through a microseism would be a very interesting thing. Find a different microseism and there better be Jews in it, which was crass but the reason why is Jews buy books. But it was also actually a very good piece of advice because it broadened the book. It broadened the potential of the book and literally the next day I was in a taxi going down Fifth Avenue going by those wedding cake buildings one after the next, after the next. I was looking out the window of the taxi and we passed a building where Paul Allen of Microsoft had just paid some insane amount of money for an apartment, bought it from a Jewish real estate developer, and I thought my God that’s it. This building was obviously built for WASPS and I can do them one better than Jews, I can give them geeks too and I decided to do an apartment building and then I went looking for the richest apartment building in New York with richest not just defined as the wealth of the people in the building, but the richness of the building itself and most important of all the richness of the narrative, and there were about 10 buildings that were on the initial list and 740 Park just percolated out of it and the proof of that, right after I signed the contract, and I hadn’t told anyone what I was doing my wife and I had dinner with two friends who were upper East side people and I told them I wouldn’t tell them what building it was but I would describe the book to them, and I described what I was doing using the building as a microseism and she said, the wife said, oh well 740 Park obviously.

AG 00:02:43 Wow, and what makes 740 Park so powerful. I mean who are some of the biggest, most famous denizens of the building


2 of 39

over history?

MG 00:02:56 00:05:40

Well, you know it’s interesting. It was known before my book as the Rockefeller building, but in fact Rockefeller was not one of the original people in the building. The thing that attracted me was that it was built by Jackie Kennedy’s grandfather, James D. Lee, in a consortium with a group of the people who were considered to be responsible for the market crash of 1929 and the depression that followed, um, which caused the building to effectively fail. It was one of the rare buildings that started as a cooperative apartment house, um, the cooperative failed rather quickly because they couldn’t sell the apartments the building opened just short after the crash of Wall Street in ’29. They couldn’t sell the apartments. The building became a money hole and it was turned into a rental and John D. Rockefeller actually arrived as a sub-‐letter, subletting an apartment from one of the people who had basically lost all of their equity when the building went bust. Um, and then it became kind of the Standard Oil building. It was a building where lots of Standard Oil executives and their friends and people associated with them all lived, and it was under water for a very long time, the original apartment owners had lost their investments and so by the 1960’s when people started to make money again and there was the next wave of big money in America in capitalist society, um, the apartments cost less than they had cost in 1929, so when Rockefeller, John D. Rockefeller Jr.’s second wife Martha Baird, died or was dying I don’t quite remember, and the apartment was put on the market Saul Steinberg who was then kind of just rising of a green mailer and one of the first of the new capitalists was actually able to buy it for $25,000 less than what it had cost in 1929 and at that point it became the building where all of the people who came to define the ‘80’s or the greed decade lived and you had Saul Steinberg, Ronald Perelman, Henry Kravis, all living in the building at various times and at that point it became kind of the holy grail for a certain kind of wealthy New Yorker. There were other buildings and certainly there were apartments in other buildings that were as good if not better but as a collection of people in a building of quality, um, it was just, it was unmatched and, um, I think probably I came along and I gave it a certain amount of cache or additional cache but it already had it, I chose the building because it was already there, I didn’t give it the aura that it had, and I guess the difference is that at that point in time only people who knew about such things knew that this was one of those buildings, you know since then you will see ads now


3 of 39

that tote Rosario Candela’s masterpiece, Candela being the architect of 740. Before I wrote the book the name Candela was far less known.

AG 00:06:00 It’s interesting that, it’s a power move, I mean it’s not necessarily, people didn’t go there necessarily to pay the highest price or, but it seems like they went there to be with other people who are powerful.

MG 00:06:13 Well, I think like attracts like, the consoling proximity of other millionaires, it was, you know at that point in the 1920’s the building was conceived of, there was all over the east side, groups of people who were building these buildings for themselves and their friends, there was for instance a Phipps building on Sutton Place South. There were little pockets where like-‐minded people created these things and you have to remember the co-‐ops had been created at the end of the 19th century for the very first time as effectively clubs for like-‐minded people. The funny thing is the first co-‐ops were created for artists and artistically-‐minded people, not for repetitious capitalist but over time those clubs could only be sustained by people with a great amount of money so 740 Park was created by a group of people who came out of one particular bank and its nexus of connections for themselves and their friends and decided to say what happened was a bunch of them lost their shirts in the stock market crash and the depression that followed therefore it couldn’t be their club, so instead it became the Rockefeller club for a long time and then it became the kind of LBO guy club in the 80’s um, and it’s pretty much kept that even as it’s evolved with the changes in capitalism, with the changes in who’s making the most money, so you know it went to private equity guys and they’re, now I think the largest category in 740 Park are hedge fund guys, they’re the people with the most money now, they’re the equivalent of the oil guys from the 30’s.

AG 00:08:14 Who are some of the key tenants in the building now?

MG 00:08:17 00:08:34

In the building now? Well the ones who fascinate me the most are kind of the, the poster children of the financial crisis of 2008, 2009, you’ve got John Fain, Ezra Merkin, who was the feeder to Bernie Madoff, Steve Schwarzman, who really did become the poster child of capitalist greed in the last ten years, David Koch who I think is probably the richest person in the building and who interestingly got into the building because they didn’t want to let a Russian in, so they actually


4 of 39

went out and solicited David Koch to buy the apartment out from under the Russian who wanted it so they wouldn’t have to let a Russian in and David Koch was considered a far better potential neighbor than Leonard Blavatnik who had actually been in America since the 1970’s but he did have connections to the oligarchs and they didn’t want that. So you have people like that but you also have a few remaining people who harken back to what the building was before the 1980’s greed brigade showed up you know. You have Winston Lord who was an American diplomat, he was the, he was the American ambassador to China I believe, who really is kind of an über-‐WASP gentleman of the old school, the kind of person who really does belong to the kind of clubs that don’t let other people in. Whereas 740 Park has now become a club for the kind of people who wouldn’t be let into Winston Lord’s kind of clubs.

AG 00:08:49 What are the kind of restrictions that are employed, if you get into the building? What are the kinds of things that you need to do in order to please the owners there? Are there restrictions on how you can build? When you can build? When you can remodel? Those kinds of things?

MG 00:10:07 00:11:15

Well, all of your questions point to one specific thing which is a particular bugaboo of New York cooperative apartment owners which is called summer work rules. Summer work rules say you can only renovate your apartment during the summer months when everybody is gone because they’re all in they’re second or third homes or San Chapelle or somewhere like that and it means that you can only renovate in June, July and August and then you have to stop and if you haven’t finished your renovation it means too bad go get a sublet because you ain’t moving in. So summer work rules is probably the worst aspect of living in one of these buildings. I think more generally you have to behave yourself. You have to be the sort of person who would be the sort of person who would be in a building like 740 Park, um, and that is a hard to define thing but rather like pornography, you know it when you see it. Or at least you know it when you see somebody who’s misbehaving, you have to, there’s a certain dignity to buildings like these. Um, Tom Wolfe, the author referred to them as the good buildings, very understated but everyone in New York knew what the good buildings were. And these are people who aspire, the people who live there are the people the aspire to live in a good building, so no matter how they made their money, they’re aspiring to something a little bit


5 of 39

better, they’re aspiring to being one of the people who rules the world, truly the masters of the universe are the people who live in these buildings. Um, most of the other restrictions are actually things that you face before you’re allowed to buy, not after you’ve bought but the other thing that defines one of these buildings is that you better have enough money to be able to afford to live there and to be able to afford to live there when you don’t really want to anymore, because when you put an apartment like that on the market, the board of the building, the cooperative board of directors gets to decide whether you can sell it or not, so let’s just say that you’ve lost your fortune and you don’t have any money and you can’t afford the maintenance at 740 Park anymore and you bring in a buyer who the board doesn’t approve of, well you’re going to have to continue to pay that maintenance bill and stay there until you find a buyer who meets the unspoken criteria that will allow them to purchase your apartment. The decision whether you can sell or not is not in your hands and that can be a very horrifying thing. What’s interesting is though that throughout that financial crisis even as some of the people who live there now began to look a little shaky as to their ability to stay there, none of them has put their apartments on the market. So obviously another rule, and it’s a rule that is important before you can buy in, comes into play here, and that is it’s the rule called multiples. So let’s say your apartment costs 30 million dollars, you have to have a multiple of 3 or 4 times that in liquid cash, in liquid assets, in other words not something that you would have trouble selling, but something that you could turn into cash tomorrow, of 3 or 4 times the purchase price. So at the point when I was writing 740 that multiple was $100 million, if you did not have quick access to $100 million the board would not even consider you and the realtors knew, don’t even bother bringing you there. Because you will never pass the board. Why waste anyone’s time and if the realtor brought you there anyway that realtor might never be able to sell an apartment in 740 Park again.

AG 00:13:47 00:13:58

I find the things on the restrictions on the sale, I mean, I find that very amusing you know deeply ironic because if you think about these guys, particular David Koch and Steven Schwarzman who are sort of, free market absolutists, it’s like the idea is that you know, whatever the market says is good, it’s a moral value yet they submitted to a rule where other people control their market, it’s like they’d never allow that with the government.


6 of 39

MG 00:14:17 You know there is irony piled on irony at places like 740 Park

and the, the deal here is that you have to be like them and the one thing that makes you like them is having so much money that you’re willing to put up with the, excuse me, bullshit rules that come will a building like this and if you want to be allowed into this club, therefore you have to submit to these rules even if in your business life your flaunting the rules on a daily basis, it’s just, it’s the way it is and if you want to live in the building you have to play by their rules.

AG 00:14:51 Did you, uh, how did you do your reporting for this? Who did you talk to inside the building?

MG 00:14:56 00:16:34

Well, first I opened a vein, um, you know the beginning was simply to find out who had lived there over the years and that took months because at that point in time there were no public records of co-‐ops because co-‐ops are not real property whereas if you had bought or sold a house there would’ve been governmental records showing the transfer of that piece of real property, because a co-‐op is not a real apartment you’re buying shares in the corporation. For many, many years, up until very recently, there were no public records of these transactions unless it happened to make the newspapers so the first step in reporting this was things like voter registration records, reverse phone directories, looking for proof of people living there, going through old news papers, things like that, then once I had the names, um, I ascertained that of the 30 people that lived there at that moment, there was only a handful that I was likely to try and write about in any kind of depth, um, I was trying to be sensitive to the fact that these people do live in this building with, you know, a line of defense that consists of a line of doormen, there aren’t hidden Doberman pinchers in the special Doberman pincher room in the lobby so I really only wanted to write about the handful who pertained to the larger story, the larger narrative of the building and then of course I approached them and then in almost every case I was turned down and then I was on my own. For the older people, what I discovered was is that many of them were more than happy to talk to me, so the families of people now dead. Um, because they represented an earlier era in American capitalism that was no longer being talked about and so their glory days of their family were often over and these were all people who were more than happy to you know, reclaim the glory that allowed their family to move into this building, in some cases


7 of 39

00:19:24

they were incredibly quiet people who were rarely in the newspapers and so it was very difficult to find original material about them and the only way you could do it was finding their families. In other cases, like the Countess Kotzebue, her, um, this was a much married woman, five, six, seven husbands who’s exploits were in the newspapers all through the depression and beyond and so I could put together her story simply from newspaper clippings and so there were various ways, with different kinds of people you had to do different things and finally, of course, you end up having to call the people who don’t want you writing about them and then basically what you need is a thick skin because people scream at you, and they hang up on you, and they threaten to sue you, and you just smile, grin, bear it and move forward um, so, the, one of the hardest things to do was to find people who worked in the building because I did want an upstairs downstairs aspect to the book, and, um, there’s a union that handles all of the buildings in New York and the buildings workers in these sorts of buildings and it’s called 32BJ and, um, I decided that what I was going to do was call the union itself and ask if there was someone there who could speak to me in general about buildings like this and I called and I called and I called and they would not speak to me, they would not return my calls, I was never able to get them to talk even in general, so then I went looking for former staffers, because I thought, ‘Well, gee maybe if they don’t work there anymore,’ and very hard to find because in many cases it’s a very common name, like you’ll hear that there was an elevator operator named Juan Gonzales, can imagine how many Juan Gonzales there are in New York? Um, but at one point I was told about a doorman, a much beloved doorman named Patrick O’Conner, now again, Patrick O’Conner, how many Patrick O’Conner’s are there in New York? Um, but people kept telling me about Patrick O’Conner that he had been there for years, that he had risen from porter to doorman, that he became the most beloved doorman, he stayed there until he retired that he was still alive, that he lived in Brooklyn, and that if I could find him he’d be a gold mine, and so I literally pulled out the phone book and I called every single Patrick O’Conner in Brooklyn and you know, there’s that moment when you’re sitting with your but in the freezing cold river and you’re panning for gold and you’re soaking wet and you’re thinking why in god’s name am I here giving myself pneumonia this is just rocks, rocks, rocks and someone answered the phone and said, ‘Yes, that’s my father’ and so I was able to spend a couple of hours with Patrick O’Conner,


8 of 39

who didn’t have a bad word to say about anyone but Patrick’s O’Conner’s good words were so much fun and so interesting and so intimate that I was able to really get a sense of what it was really like to work downstairs from that one man.

AG 00:20:06 What was it like? What was so interesting about what that one man said to you?

MG 00:20:09 00:22:07

Well, well, I think that for people of the working class, um, to work in a building like that you know, as is probably true with the fictional versions that we seen now in Dowton Abbey, you become, a little bit of it rubs off on you, you’re in one of the most exclusive buildings in New York so you are a staffer in one of the most exclusive buildings in New York, so you become exclusive. You’re seeing exclusive people every single day, Patrick O’Conner was able to tell me stories about old man Rockefeller coming down in the elevator in his, in his later years when he was terribly old and terribly frail and he was always cold and asking to have the heat turned up and let me tell you, for old man Rockefeller, they turned the heat up fast. Um, you know, so stories like that, stories about the kids who came back late drunk and needed to be snuck into their parents apartment, those kinds of things, it added just a human dimension and they’re aware of the fact that the people in the building are different but they also become in a certain sense, part of the family. Um, if you look at a building like this not as a building but as a community, of like-‐minded souls, then the people who work there are also very much part of that community and so it’s a different view you know, instead of a bird’s eye view of someone soaring in their penthouse, you’re getting the view of the person who’s standing at the door watching the people going in and out but you also get a sense of the fact that in every community there are nice people and there are awful people there are people of gentle manners and there are people with no manners, there are people who treat the staff like garbage and there are people who treat the staff like human beings and know their names and take care of them at Christmas, all of these things are part of the texture of the community of a building and I imagine, you know, that you could do the exact same thing about a tenement building on East whatever street in New York the only difference is that the tenement tenants aren’t going to have names like Rockefeller and Bedford and Vancroft and Vanderbilt.

AG 00:22:28 We, uh, you know, we were talking earlier about the whole


9 of 39

kids thing which I found very interesting as I said, [mumbles] a kind of dividing line at the age of 12 or 13 when then kids get told, don’t talk to them anymore, but your experience was that a lot of the kids at least in the 60’s seemed to relate more to the doorman and stuff than they did to the parents.

MG 00:22:55 00:24:52

Well, I think that the relationship between the kids and the doormen is something that will really be defined by the period of time that you’re in because in the 60’s you know, remember that all of the forms that had framed life in a community like the Upper East Side which is after all one of the wealthiest communities in America, all of the forms, all of the formalities had fallen apart at that point so instead of kids joining the knickerbocker grays wearing their little military uniforms and marching in lock step on every Wednesday and going to dancing class on every Tuesday you had kids wearing jeans going out and smoking pot with their boyfriends and coming back at two o’clock in the morning on the back of a motorcycle which the parents would not have approved of, the kids were no longer following in lock step the way that they were supposed to be and so who can you relate to, well, at that point in time, kids, no matter how wealthy they were related to the doormen and the street than they did to the debutante cotillion and the world of their parents and so an aspect of that rebellion was getting along with the doormen and so you had these kids in the 60’s and the 70’s who were really in league with the doorman because the doormen go the kids better than the parents did. I think now it’s probably much different because ever since the mid-‐80’s everything old is new again. All of those forms have come back, you know, there was really a lost generation in what passes for society in New York, there was a period when people stopped living life that way, when they didn’t wear ball gowns they didn’t go to benefits, they went to communes they smoked dope, they took LSD, they went to rock concerts, they preferred the Fillmore East to the International Debutante’s Ball, they wanted to, they wanted to get laid, they didn’t want to walk around with chastity belts on, sipping tea and behaving like their parents wanted them too so it was only natural to, all over the country this was happening, it just seemed more cute in a place like 740 park, now-‐a-‐days kids want to grow up to be rapacious capitalist just like their parents, they’re probably begging their parents, can’t I get a new Blue Blazer right now dad? No! I don’t wanna wait! You know, let’s go buy me a tie, let’s go to Paul Stewart, I think that that kind of thing just reflects the changing of the culture. And, and, there was that moment


10 of 39

when there was a changing of the guard, it lasted for a good 20 years, and entire generation disappeared, simply ceased to be part of that world and then suddenly in the 1980’s and, you know, this was a moment when 740 park became the epicenter again, you had a whole generation that wanted to go back to that way of living and you had what women’s wear daily so memorably dubbed Novelle Society. And who were the kings and queens of Novelle Society? They all lived at 740 park.

AG 00:25:59 Yeah, well, it’s interesting that the, the culture of, the new culture of 740 park is much more, the old money culture are rare to find as it was never the less seemed to have a sense of almost no blood should leave, it seems like the new culture is just, very self-‐enclosed it’s like a castle with a big mote around it.

MG 00:26:26 00:27:38

Well, you know it’s interesting. One of the things that, that, after you know, a number of years as a journalist you realize is that, um, you should never generalize, um, and as I was writing 740 park and I was looking at these people who in the public mind, in the public imagination and frankly in my mind had all been lumped together and you discover that they’re not all the same so in the realm of philanthropy, you know someone like Henry Kravis, who lived for many years at 740 park, and lived there in a phase of his life much different from the phase of his life much different from the phase of his life he’s in now. Lived there when he was married to his second wife, Carolyn Rome who was a dress designer they were out every night, they were spending money garishly, you know, an apartment so over decorated that you needed anti-‐nausea pills to walk in there, I remember Carolyn Rome taking me in there and showing me her little Renoir and, you know, these seem to be exactly the same as everyone else and yet when I started looking into the lives of some of these people, what I discovered was Henry Kravis had been quietly philanthropic for years, had never tooted his own horn, had given away money, had chosen charities not for the bang he would get for his buck but actually for what he would do for the community in which he made his money and my respect for Henry Kravis grew and grew and grew, um, at that point in time Steve Schwarzman lived in the apartment that had previously been owned by Saul Steinberg and before that by John D. Rockefeller Jr. and I had decided that I wanted to end the book on that apartment. I opened the book on Saul Steinberg and then I ended the book on Steve Schwarzman right at the point


11 of 39

00:30:32

where he bought Saul Steinberg’s apartment. Remember, by the way, $225,000 Rockefeller to Steinberg, $30 million dollars Steinberg to Schwarzman, uh, he made a nice, nice, killing there Mr. Steinberg, um, Schwarzman at that point was notable for his lack of philanthropy and when I ended the book I was sitting at my computer thinking, okay, now how, what thought do I want to end this book on and I ended it with the line, that Steve Schwarzman has two very, very, very big floors to fill, playing off the idea that the shoes of John D. Rockefeller Jr., here he is living in the man’s apartment, but John D. Rockefeller Jr. was the model of the perfect philanthropist, his entire life after, after a certain point, after a certain age was devoted to philanthropy was devoted to cultural philanthropy, medical philanthropy, every kind of philanthropy you could imagine, if anybody wanted to be a philanthropist, I remember when Bill Gates and Warren Buffet were announcing their co-‐venture in philanthropy they kept talking about John D. Rockefeller Jr. as a model and here was the notably un-‐philanthropic Steve Schwarzman sitting in that apartment and I wanted to end it on that thought so I said, you know, he’s got a long way to go to be John D. Rockefeller Jr. but he’s also a young man, let’s see what happens, giving him the benefit of the doubt, and indeed thereafter he gave some huge sum, I think $100 or $200 million dollars to the New York Public Library, the difference was that much, not all, but much of Rockefeller’s philanthropy was anonymous, was quiet, he would, he was a man who refused a seat on the board of the Metropolitan Museum of Art, which is considered the brass ring of accomplishment in New York society, if you want to be philanthropist what you want most of all is a seat on that board and Jr. would turn it down over and over and over again, he would give money and demand as a condition for the money that his name never be used and when Steve Schwarzman gave that nine figure sum to the New York Public Library, what did he do? That main building with patience and fortitude sitting out front will henceforth be known as the Steven Schwarzman Building at the New York Public Library and there are some of us who think it was always the main building and it will always be the main building, so he bought his name on that building, it’s still, there’s still a way for him to go before he really does fill the shoes of John D. Rockefeller Jr. and I think it’s very interesting to look at people like this in the full context of wealth in American and Schwarzman by buying that apartment just happened to set the bar very high for himself.


12 of 39

AG 00:31:10 Let’s talk a little bit about… [TRACK 04] AG 00:31:11 … that apartment, I mean, in your book it’s there are three

very big owners, how big is that apartment? And how, um, what do we know about people today? Didn’t, uh, Steve Schwarzman actually duplicate it for one of his birthday parties at the armory?

MG 00:31:32 00:33:20

Yeah, oh, I do. There was a famous party at the armory where Schwarzman put but tableaus that were rather like his apartment but of course I wasn’t invited. Uh, gee, what a surprise. The, um, the apartment was built for a man named George Brewster, and George Brewster had actually owned a private home on the corner of 71st Street and Park Avenue and in order to induce him to sell his home for this building James T. Lee, um, agreed to recreate his five story home at the top of 740 park. And, um, over the years that apartment has been described as a triplex, a quadruplex, and I believe even in quintiplex – a five story apartment, but in fact it is a duplex apartment with a mezzanine where there are servants rooms, over the service part of the apartment, so where the kitchen and the servant’s quarter’s are on the lower floor there’s a mezzanine where there are some more servants rooms, that’s why it’s often been referred to as a triplex, but it’s also a double apartment because it is – in every new York apartment building there are lines and floors. So, in 740 park you have the A, B, C and D line. And the Schwarzman, Rockefeller, Steinberg apartment is 15, 16 A and B. So it’s a sprawling apartment, it’s 37 rooms. I don’t even remember how many bedrooms but more than we can count here and it is of a lavishness that made it one of the great trophy apartments in New York and, but my favorite story about it actually doesn’t pertain to any of the people who live there now, it goes back to the original Mrs. Brewster who, um, wanted not only an elevator that went up and down between 15 and 16 but wanted to know why she couldn’t have an elevator that could take her from side to side in her sprawling apartment and someone had to explain to her that elevators only went up and down. We love Mrs. Brewster. Um, um, and the interesting thing about that apartment is that in the 60’s it was truly considered a white elephant which is how Saul Steinberg got it for so little money, because it was expensive to maintain. I think if I’m remembering correctly it’s about 10,000 sq. ft. but square footage is a very funny thing in New York apartments


13 of 39

because what do you count, do you count closets, do you count bathrooms, uh, do you count the foyer, do you count the entry way? But it’s about 10,000 sq. ft. and lavish beyond your wildest imagining, you know, huge room, multiple, more bathrooms than there are bedrooms, I could give you the detail but I would have to pull out the book and pin point it because the description of the apartment goes on for about a page and a half.

AG 00:34:38

The, uh, were you ever able to get into the apartment?

MG 00:34:41 You know, I, this is one of the worst memories of my life. In the 1980’s I briefly worked at the New York Times and as a reporter for the New York Times writing for the style page which was essentially a page that covered the doings of rich people, you got invited to a lot of really lavish apartments and I was invited to the Steinberg’s one night for a benefit for the New York City Opera and I was so jaded after a couple of years of visiting these apartments and I went, eh, nah, and I skipped that night and who knew that ten years later I was going to write a book about the building, no I was in a number of apartments in 740 and unfortunately never in that one and of course after the book came out Steven Schwarzman wasn’t going to invite me.

AG 00:35:24 What do we think, uh, in terms of, we were just chatting sort of idly speculating about, uh, real estate and, what 740 Park might be worth. Let me imagine, what 740 park might be worth and what do we think, is 740 park one of the richest buildings in New York and the country or is that an overstatement?

MG 00:35:50 00:35:53

I think that there’s a bit of a paradigm shift going on in New York right now that those kinds of old line buildings have fallen out of fashion to a certain extent. You still, absolutely have people lusting after apartments in all of those 10 buildings that were on my original list and 740 park is still very much at the top, um, but co-‐ops are a little out of fashion, people like condos now, old buildings are a little out of fashion, people like the latest finishes and the latest this and the latest that now, 740 Park doesn’t have a health club, it doesn’t have a health club, it doesn’t have a concierge. Rich people want all those things now, 740 Park is also, New York Co-‐Ops in general are for people who are settled, they’re for people who actually want to live in their apartments and make them their primary residences. Whereas the wealthy


14 of 39

condos in New York now are for people who have five homes all around the world and might be in their 80 million dollar apartment for one month a year and otherwise it’s empty and that happens at 740 park, I mean there are fully staffed apartments that are never occupied in that building but they’re still worth a great deal of month and I think they maintain their cache and I’m constantly asking realtors, because I’m curious and I have a certain vested interested in this building, ‘What’s Schwarzman’s apartment worth today? What’s Schwarzman’s… ’ and you know, just a few weeks ago an apartment sold at 15 Central Park West for $88 million. A ten-‐room apartment. Now, the difference is it has views of not only central park but also the Hudson river, it’s a brand new building, it’s the building of the moment, it’s the 740 Park of the 21st century, um, but it’s only got 10 rooms. And Schwarzman has 37 rooms, he doesn’t look at the park though and it’s a co-‐op not a condo, so I said to someone, ‘okay, if the penthouse at 10 Central Park West is worth $88 million, what’s Schwarzman worth today?’ and the answer I got was easy $65 million which means he could probably ask for more, um, and, if I was Steve Schwarzman of course that’s chump change for him so what does he need to sell his apartment for, I would love to see that apartment go on the market now and I would love to see 740 Park get it’s record back but I think that apartment really makes him, really matters to Steven Schwarzman and I don’t think he’s gonna give it up real easy, and I kind of see him digging in his finger nails and going, ‘I will not die, I will not die! I wanna stay here!’

AG 00:38:25 Why do you think it matters so much to Steve Schwarzman?

MG 00:38:27 00:38:30

Because he’s the king of the world, because it represents something, it puts him in, you know we were talking about George Brewster, who that apartment was built for. George Brewster was a direct descendant of Elder Brewster of the Mayflower colony, the leader of the, who came on the Mayflower and was the leader of the Plymouth colony. George Brewster is a very important man in American history; the next person in that apartment was John D. Rockefeller Jr. you don’t get anymore quintessentially capitalist than that. The next person in that apartment was Saul Steinberg, who was one of the rip-‐snorting cowboys of capitalism from the mid-‐‘60’s straight through until 2000, when, sad to say, he lost his shirt and he was forced to sell. To own that apartment is to be the king of capitalism, and that’s what Steve Schwarzman is now, and as long as he’s in that apartment you will have to


15 of 39

think of him in those terms. Yes, it might be a world where there’s more than one king now, it’s not just Rockefeller, but owning that apartment confers an extraordinary status and, and, one would not give that up easily. He’s the sun king. Sitting on top of the world.

AG 00:39:46 What do we know about David Koch’s place?

MG 00:39:50 David Koch’s apartment, the thing that I love the most about it is that it was the apartment that was owned by Black Jack Bouvier and his wife, Janet, the parents of Jacqueline Bouvier, Kennedy Onassis and Lee Bouvier Radiziwill, um, Jackie Kennedy grew up in that apartment which I just find a priceless fact. Uh, it’s on a low floor. It’s in the B-‐line, so it’s actually not as good an apartment as an A-‐line apartment but it’s on the corner, which means it has different exposures. Um, and, you know it’s, it’s a perfectly nice apartment, it’s uh, a duplex like just about every apartment in 740 park, they’re only a few simplexes in there, and one true triplex which was the real penthouse in that building. Um, David Koch’s apartment is simply a very nice luxury New York City apartment. It’s not one of the special residences in 740 park.

AG 00:40:50 But he was entreated to come, to buy it…?

MG 00:40:54 00:41:18

The reason why, he lived at, interestingly, he lived in Jackie Kennedy’s former apartment at 1040 5th Avenue and he lived there with his wife and mother, or no, he wanted to buy a second apartment in the building for his wife’s mother and the would not allow him to buy a second apartment because there was a rule as co-‐ops have all these crazy rules that you cannot buy another apartment that’s not contiguous because they don’t want people going up and down in the elevators between two apartments, um, and in many buildings they also don’t want people controlling that many apartments because it gives you and outsized voice in the governments of the buildings. So Koch was in the market looking for a new apartment where there was going to be room for his mother in law and that’s how they got him to buy it and of course it was the most exclusive club in New York, the most exclusive residential club in New York at that point and for David Koch who was always a bit of an outsider in New York Society despite extraordinary philanthropy to be invited to join the club was I think one of the great moments of his life, he was one of the few of the present residents who spoke to me on the record for the book and he was just bubbling over with


16 of 39

delight at being asked to move into that building he thought it was great.

AG 00:42:14 What did you make of it, what was your interview with him like?

MG 00:42:16 00:44:00

Well, I, hardly an interview, a long phone call. I’ve known David Koch since, I’d say the early 90’s. I first interviewed him when I wrote a story about the Ballet Companies in New York. And he had just, at that point essentially become the savior of the American ballet theater. It was on the verge of going out of business and Koch’s money was keeping it alive. And it was a bad moment for ballet in New York, ’91, ‘92 there was a bad moment financially in New York, money wasn’t flowing the way it does sometimes and doesn’t at other times and Koch was being entreated to become the chairman of the board and he didn’t want to do it, he was sort of this reluctant, blushing debutant who didn’t want to tie the knot with the Ballet company, but it was the very beginning, he was very new in New York, he wasn’t married yet, he was actually a pretty wild bachelor who’s parties were renown for being full of people form every walk of life, um, including women who my grandmother would’ve called painted hussies. Uh, his July 4th party at his house in South Hampton was legendary, he was kind of a, he was an interesting phenomenon because he a, was a kind of a loose bachelor for Kansas, but he also, his aspect was of a kind of, you know, goofy normal guy, he’s got this great whooping laugh that’s almost cartoony, he’s very, he’s a very back-‐slappy, he gives off a very friendly, um, aspect. Um, and he also seems, both innocent and delighted to be David Koch and to be living the life that he lives and having a great deal of fun. At that point I knew nothing about his political involvements. And, the thing about New York is though that New York has still the old-‐fashioned notion that there are things that are not topics of conversation in polite society, and if you define polite society in New York as the society that cares about New York that gives money away that supports the city, that has a stake in the city, then it’s probably very good that people don’t talk about sex, death, politics and money over the dinner table because they don’t get into fights and people on the left and people on the right can dine together and enjoy their caviar pie without slinging it across the table at each other. You know I’ve said this before, New York philanthropy in particular doesn’t care if your money is red or blue, as long as it’s green. And not only is David Koch’s money green, but there are torrents of it, and they want that


17 of 39

money and David Koch to his credit is willing to give it away in very large sums. And, without pulling the kind of stunts that some New Yorkers pull. You know I’ve also written a book about philanthropy in New York called, ‘Rouge’s Gallery’ about the Metropolitan Museum and there are people in New York that will put so many strings on a multi-‐million dollar donation that the institutions will say, you know what, we don’t want your money. They like David Koch’s money, David Koch is easy, he’s generous, he gives it away. Now, if you want to talk about politics, there’s another side to David Koch, but in a club like 740 Park, they can’t limit themselves to those on the left or those on the right because you never know where the next fortune is going to be. And, I don’t think that, I think that they are polite. That they don’t hold one’s political orientation against one and as I’ve discovered in writing the book, there were a lot of closeted gay people in that building who were not disdained, even when they came out. There are people of all sorts in that building, um, no black people… So there’s still some hurdles for 740 Park to get over. Uh, but they have Asians, you know, and they’ve had, they have Jews when people still thought that the great co-‐ops of Park Avenue were absolutely restricted and anti-‐Semitic. There were already Jews at 740 Park, um, for a next question you might ask me about the first Jew at 740 park because that’s a funny story.

AG 00:46:53 Okay, who was the first Jew at 740 Park?

MG 00:46:55 00:47:02

Well the first Jew at 740 Park looked like something right out of a Ralph Lauren ad. In other words, the first Jew at 740 Park was passing as an Episcopalian, his name was Colonel William Schiff, he wandered around in japers and riding gear and, um, his second wife, when I informed her that her husband was Jewish said, ‘He was not! He was a pillar of St. James Episcopal Church!’ in fact, he was a Jewish insurance executive who passed as an Episcopalian for many, many years. Bought an apartment in 740 Park in 1948 and what’s very odd was that became one of the so-‐called Jewish apartments because it went to another Jewish family but over time there were never restrictions put on it and as I was writing the book in 2005, when I was just finishing the book a hedge fund guy named David Ganek bought an apartment in the building for the first time the building was 51% Jewish, and so from 1948 until 2005 you went from no Jews to a building that was more than half Jewish and in that, 740 park is a very ecumenical building, it was very far ahead of many of the buildings in New York


18 of 39

and recognized the fact that it wasn’t about blood or religion or clubs, it was about the club of money. And that’s what 740 Park represented.

AG 00:48:32 You know one of the reasons I got interested in 740, obviously David Koch and Steven Schwarzman are interesting people, but one of the things that makes them interesting to me is, you know, people get hung up a lot on, you know, the idea of good guys and bad guys, and, you know [inaudible] … and I think also that the fence of this that you see, you know it’s like, what? I’m a perfectly nice guy, don’t they understand? As if it’s about, if they laugh at jokes, do they pet their dog, all of that stuff, but what interested me about those two in particular was the way, if you’re looking at a country that seems to me moving further and further apart, Steve Schwarzman and David Koch are people who seem very much interested in making sure that the rules work for them. That they change the rules in ways that work for them, um, and, and uh, redefine this idea of wealth, you know, um, so that it means a symbol to kind of, a symbol of achievement but it’s no longer kept like Henry Kravis, like this notion to, um, I don’t know, make the world a better place? Do you think that, am I…?

MG 00:50:06 00:50:33

The first time I met Henry Kravis, um, was at a party at the Park Ave. armory, a big black tie thing, and he had a little button in his lapel and in all innocence I asked him what it was and it signified that he was a republican Eagle which meant that he was one of the best performing fundraisers and givers to the republican party and this was during the… regime of Regan/Bush. And, um, I was kind of taken aback that, you know, in a city like New York, such a liberal city, you know a city where, hell everyone’s a democrat in New York, he would walk around with this and he was very proud of it, I… I think that the point here is that if you live in a society of pirates, then piracy is your norm. Um, and you don’t think that slitting somebody’s throat is violating the norm of society because that is your society. Um, if you live in a world where everyone you know is chasing huge sums of money every day and their morality is determined by what it’s necessary to do to get richer and richer and richer you’re not going to have the same moral constructs affecting your behavior as someone who, um, cares more about the golden rule and goes to church and thinks of themselves as a decent hardworking person, there’s a difference. Um, when you have lived with that kind of wealth for so many years, you are no longer constrained by the ideas and the limits that constrain normal people. So


19 of 39

00:54:19

there’s that. But, there’s also in terms of the rules, I think that it’s important to remember that they see themselves, if they think about this at all, as the direct successors of the people who created America, the people who created capitalism, the people who perfected capitalism, and here what are you dealing with? You’re dealing with people who rape the earth, who stole, who committed so many horrible actions that rules were created to stop the next guy from doing that and so it’s not that they want to change the world to suit them, it’s that they want to go back to a world that no longer exists that would’ve suited them much better and I think if you look at the repeal of Glass-‐Steagall, you can see that. That at that moment in the 80’s or the 90’s when all of the structures that were put into place to prevent another market crash, and that worked so well for so many years were removed, and set the stage for Leiman Brothers, the collapse of the world economy and the reinstitution of regulation that we’re now seeing. So the capitalists, the people who live in that world everyday, and who think that rape, murder and bludgeoning are the norm, will think that, what do you mean you want to stop me from doing this? What I do is what makes this country great. And so, and they’re only surrounded by other people like them. There are no checks on them. And they’re at polite dinner tables where everyone wants to eat their caviar pie in peace. And not have somebody go, ‘David Koch you shouldn’t give money to the Tea Party’ no one will do that to David Koch, except the press and you know, little insets like documentarians and journalists and protestors standing in front of the building with an inflatable rat which he can just, you know, flick off with the wave of his hand as he leaves his cosseted building and steps into his limousine and rides to his private plane which takes off from Teterboro and takes him to Palm Beach where he goes to his house where he’s surrounded by other people who believe the same things that he believes. So, the, the forces that might make someone question those beliefs are not there, the incentive is to continue doing what you’ve done all your life, what your father did, what has worked for you. If your goal is more money, then anything that seems to be in the way of more money is the enemy. So, knock down those regulations, I don’t want that, I don’t want Obama he’s a socialist, I want Ron Paul or Newt Gingrich. I don’t find it… I don’t find it appalling that people who live in that world believe those kinds of things, I find it, perfectly understandable. Um, what I find extraordinary and worthy of celebration is when someone can break out of the cage, that the lovely, plush, golden, perfect


20 of 39

cage that money creates for them and can act in a different way. When a Henry Kravis can fund the fellowship for New York, when a John D. Rockefeller Jr. can give away millions and millions and millions to ensure that new York city has the best art museums in the work, it’s things like that, it’s when they can go against type and so you know, despite the fact that the main building of the New York Public Library we’re now supposed to call the Schwarzman building, I still think the fact that Steve Schwarzman gave a nine figure sum to the New York Public Library is something that we should celebrate because we should encourage Steve Schwarzman to keep doing that and perhaps next time do it with a little less ego and fewer strings attached, I mean there people are there, they’re facts. So we should celebrate them when they do something well and we should be the little gnats bugging them when they do something that’s just following type. Because that’s what they do, they act according to their own interests, they follow type and you know the argument that, that’s what made America can’t be dismissed. It is one of the things that made America, it’s just not the only one.

AG 00:57:05 Well I mean that’s why I think that, I’ve become more and more interested in the psychology of these, I mean one of the key moments of you know, when Steve Schwarzman said, Obama might abolish, or try to abolish the hedge fund loophole because you know, he said, he compared it to Hitler…

MG 00:57:33 You mean the tax?

AG 00:57:35 The, the, yeah.

MG 00:57:37 Carried Interest…

AG 00:57:38 Right, the carried interest loophole. Um, he compared that to Hitler’s invasion of Poland and, the reason I’m interested in that is like it’s a… it’s a, the carried interest loophole is such a, for me it’s an interesting symbol because you wonder why, as Warren Buffet pointed out, why is it that Steve Schwarzman should get half of what a fireman would get to pull people out of a burning out and, and also that he would even be, that he would even think that he was being so victimized that he was somehow, you know a polish Jew being invaded by Nazis.

MG 00:58:23

Well let’s take it out of the realm of the individual first and come back to Mr. Schwarzman. Um, I have the same reaction that you have in particular instance. When Mayor Bloomberg


21 of 39

1:00:23

starts inveighing against the people who want to try and put limits on Wall Street because Wall Street is the engine that drives new York and here’s Bloomberg who’s been the leader through this great expansionary period and he’s had all this money to spend because Wall Street’s been sending off so much money that New York City profits from it. Well, you know, there was a New York City before. There was a New York city when the economy was bad. There was a New York city in the ‘70’s when the economy was shit. And that New York was as vital as New York City is now it was just a different kind of vitality. The vitality was artistic, the vitality was cultural, it wasn’t financial and yet, New York in 1974 contributed a great deal to the world just as New York in 2006 contributed a great deal to the world and to say we must not regulate Wall Street because New York needs that money that’s just because you’ve gotten used to it, Mike. And, by the way, they’re the ones you eat caviar pie with Mike. Um, Schwarzman, you know a lot of these people, uh, just because you’re rich doesn’t make you smart, just because you’re rich doesn’t make you cultured, just because you’re rich doesn’t make you refined. Being rich means you’re rich. Some of them are capable of taking this bounty that they have earned or that has been given to them and turning it into something better. Using their wealth to improve themselves, improve the world, just do small things. Some rich people are just dicks, and you know, I don’t know whether Steve Schwarzman in his private life is a nice guy or not, my few encounters with Steve Schwarzman indicate to me that Steve Schwarzman who compared the end of the carried interest loophole to Nazism, you know, he’s a dick. He acts like a dick. He acted like a dick the first time I called him and asked him for an interview for 740 Park. He acted like a dick the next time I ran into him, um, I mean, you know, I, I had been trying to get him on the phone to interview him, I knew he wasn’t going to do it, I knew he wasn’t going to give me an interview but you try anyway. Um, which is why you need a thick skin to do what I do and to do what you do. Um, and I finally did get him, no I never got him on the phone, I faxed him at his home in San Chapelle, somehow I got his fax number, and I’d left messages in his office I’d called him in New York, I couldn’t get him on the phone, couldn’t get him on the phone, he wasn’t going to dane to talk to an insect like me. Pft, journalist. And how do I know that’s how he felt? Well finally a friend sat me down at a table next to his at a dinner party and he was right there, we were back to back and there was very good wine that night and so I waited until I had been fortified with a few glasses of wine,


22 of 39

01:02:47

you know, getting my liquid courage up and, and as dinner was ending and people were going to the dance floor and he had just stood up and I said, ‘Steve, I’m Michael Gross, I’m the fellow who’s trying to interview you about 740 Park,’ and instead of taking my hand he looked me up and down with this look of sheer disdain on his face and he went, ‘Psh, good luck.’ Turned on his heel and walked away. Very good way to ensure that the person who’s writing about you has a very, very good first impression of you and you know still I felt I had to give the guy the benefit of the doubt and I think that in the way that I wrote about him I did and I think that what I did was I tried to encourage him to stop putting 102% of his interest into the accumulation of more money, more money, more money and to just devote 3 or 4%, get it down to 90%, to doing good with your money. And you know, I won’t give myself credit for his donations to charity that have followed but I can’t imagine it hurt. And it’s certainly good for the New York Public Library, you know patience and fortitude, with patience even a Steve Schwarzman might turn around…

[TRACK 05] AG 01:02:48 The, um…

MG O1:02:49 Can you say ‘dick’ in a documentary?

AG 01:02:51 In my documentaries.

MG [Laughs]

AG 01:02:54 I was, um, speaking of rules there’s an interesting, who’s the

guy, and, um, Blair may have to remind me, but there’s a guy who, um, there’s a wonderful example in 740 I think of a guy through some sort of dispute has refused to pay his mortgage there for …

MG 01:03:17 Oh, Kent Swig, of course.

AG 01:03:19 Um, and it’s interesting because you know we hear stories all the time, I know this seems very crude in comparison, but we’re now in a mortgage crisis where people are being foreclosed across the country but it’s rather remarkable, you know.

MG 01:03:33 Well now, I, I wanna be careful here, because although I have


23 of 39

01:05:13

sources in this that I trust, I’ve not really reported this because it all happened subsequent to the book but when I was writing 740 Park, um, I found in the public records what appeared to be mortgage documents on Canton Elizabeth Swig’s apartment. It appeared that they had a mortgage, and 740 Park is a cash-‐only building in other words if that apartment costs $30 million you’ve gotta come up with $30 million dollars, you cannot finance it. And I found this document and you know, who cared about Kent Swig? He wasn’t that interesting, I didn’t pursue it, I might’ve asked a couple of questions, I don’t even remember what I found out and now it’s many years later and, um, Kent Swig and Elizabeth Macklowe that Bank of America is trying to foreclose on that apartment and it’s because there’s a loan and so I asked some questions and, um, what I found out was that Kent Swig was so clever that he did some kind of special loan that did not require the board to sign Aztec recognition agreements which said that if he defaulted that the shares on his apartment would go to the bank and not back to him. The normal, standard procedure, he found a way to avoid it and he took out a loan on that apartment that was not signed off by the co-‐op, was not signed off by the managing company and curiously, Kent Swig is one of the owners of the company that manages 740 Park. I’d always assumed that somehow he’d pulled strings to do that, but in fact the management company was unaware of it because he did it sub-‐rosa, you know, under the table and yeah, there was this you know, wonderful irony that here’s a guy who comes from a San Francisco real-‐estate family, his wife was Harry Macklowe’s daughter, another great New York real-‐estate dynasty but you know the fact is that people who deal with money all the time know every trick in the book, when you research real estate developers what you discover is they go bankrupt all the time. And they give buildings back to the bank all the time, their entire lives depend upon the market, they extent themselves hugely, and if the economy takes a band turn they’re flattened, and what’s great about this kind of person is they have so much drive, that they come back. And ten years later they’re building buildings again and borrowing hundreds of millions of dollars again, even though they’ve been foreclosed upon, even though they’ve gone bankrupt, in fact they, remember the Joe Palooka dolls when we were kids? Where you knocked, they had the sand, they were blow up things with sand in the bottom and you would punch them and they would fall down and just come right back up. And that’s a place where I think rich people are admirable. They come back, they don’t give up,


24 of 39

they don’t’ slick off to a cave and lick their wounds and disappear, in so many cases they come back, and that kind of fortitude I think is admirable. I find the psychology of these people fascinating, um, I suppose that what I do is some form of cultural anthropology and you know, my specialty is writing about rich people, they’re infinitely fascinating and the fact is that wealth does not equate with evil, wealth sometimes equates with evil.

AG 01:07:19 Well you were saying that, you, what was that great line you have where you compare yourself to your sister? She comforts the afflicted?

MG 01:07:27 01:08:03

Oh, well, you know, I grew up the, I grew up the son of a journalist, my father was a sports writer, columnist, for the New York Post, so I grew up steeped in the legends of journalism and somewhere back there somebody said, you know the job of a journalist is to afflict the comfortable and comfort the afflicted and after, both my sister and I went into journalism and, um, my sister became a person who comforts the afflicted, that’s what she writes about, and she does it beautiful, she can write in ways that make you cry and somehow I was naturally drawn to first writing about rock stars, then fashion designers and now what passes for society and so I suppose that what I do is I afflict the comfortable because I’m not a lap dog, I don’t want to be invited, you know, it’s very nice to be invited over to eat caviar pie or turn down an invitation, but you know, my, one of my idols was Charlotte Curtis who was the Women’s Day editor in the 1960’s. And, um, I was luck enough to cross paths with Charlotte Curtis when I worked at the Times. And, um, Charlotte Curtis had written a book that my wife had given me when I first started writing about this stuff and she handed me the book as a present and she said, you know you could do this, and the title of the book is ‘The Rich and Other Atrocities’ and you know Charlotte Curtis was a person who wore ball gowns, went to fancy parties, ate with the very people that she dined upon, journalistically, and what she said to me one day when I was sitting in her office at the times was, if I’m invited my notebook is invited, if my notebook isn’t welcome, I’m not coming. And you know that kind of defined my approach to this stuff. So many people write about rich people, and their purpose is to glorify and extol the virtues of the rich people and, you know, hide the fact that, um, the beautiful wife of the middle east dictator is all in on crushing the rebellion and killing people who don’t agree with her husband, some people


25 of 39

take that point of view, most of the, what passes for the press covering this kind of world takes that kind of view. I just try to look at them straight and see the good and the bad and you know I’m not always popular because it happens that I do like David Koch as a human being, my encounters with him have always been pleasant, he’s nice to me, he returns my phone calls. I don’t like his politics, at all. But, I don’t think that life is enhanced by people who feel that they don’t want any association with someone who’s on the other side of the political line, I think that your life is enhanced by being able to talk to everyone, by being able to hear their point of view and I learned this from a friend who was probably one of the most conservative people I’ve ever met and I was invited as a reporter to their house once for dinner and it was the first times I’d met one of the grand old republicans of this country and I sat at this man’s dinner table skeptical and what I discovered was, he was one of the smartest, most interesting people I’d ever met and what I had to do to be his friend was not mind his politics. But here’s the thing, he didn’t mind mine, either.

AG 01:11:07 What was the, um, reception…

MG 01:11:09 Boy that answer went all over the place.

AG 01:11:11 It was great. Though, I loved it. What was the reception of your book like, particularly among the denizens of the, and was there, uh, pressure brought onto your publishing?

MG 01:11:23 The, the reception to 740 Park was actually fairly, um, benign compared to what happened with later books. Um, with later books I actually learned what the Spanish inquisition is like. With 740 Park there was one particular individual in that building who took great offense at the way she was portrayed and, um, a blog called Gawker discovered that she had been posting horrific reviews of my book on Amazon under fake names and exposed the who thing and she’s never been heard from again, which is you know, good. Um, um, I was um, upbraided on night on a Upper-‐East-‐Side high society restaurant called Swifties, by someone who insisted that I’d gotten something wrong. Um, Rand Araskog who had been the chairman of ITT, um, in ITT’s annual report from the year that he bought that apartment, it said that ITT had bought that apartment and Mrs. Araskog came up to me in this restaurant and yelled at me for saying that ITT had paid for the apartment and I looked at her and I said, you know, Mrs.


26 of 39

Araskog, you didn’t return my phone call when I called to check all these things, how was I supposed to know your side of the story if you wouldn’t tell it to me. So you know you get those kinds of reactions but what was hysterically funny about that was that Mrs. Araskog was the one who came to my book party, but not only walked out with five free copies of the book but posed for pictures with the stack of free copies. Which I thought was kind of charming?

AG 01:13:05 Kissinger didn’t have a reaction to your book? That was not 740? That was a different one?

MG 01:13:09 01:13:41

No, um, Kissinger, Henry Kissinger, um, attempted to have my book on the Metropolitan Museum of Art stopped and pulled and to the great credit of Random House they resisted his pressure but he called Liz Moan who was the family, the head of the family that owns Bertelsmann which owns Random House and he [accent] in – Dr. Kissinger insisted that this book was full of lies and not to be published. And um, they ignored him and they went ahead and published it, but that was the book that was the book that was greeted with the Spanish Inquisition. As, there are two kinds of journalists, there are access journalists who depend upon their rolodex, and the fact that they’re welcome. And they know that you don’t ask Tom Cruise about scientology and that’s how they get access to Tom Cruise. And then there are enterprise journalists who go after the story whether or not someone will talk to them, we happen to live in an access world, um, I’ve always tried to do both, I’ve always tried to have as much access as I possibly can and if I don’t have access then you just fall back on enterprise and you know as long as you keep your chops you’ll get the story and that’s what I do.

AG 01:14:28 The, um, I want to ask you a couple of things about, oh! I know, one other apartment I wanted to talk about.

MG 01:14:36 Oh god that sky.

AG 01:14:37 Isn’t it beautiful?

MG 01:14:38 Wow… Unbelievable. How does it look in the?

AG 01:14:43 Great.

MG 01:14:44 Sorry to interrupt.

AG 01:14:46 Um, John Thain. I have a pal, actually, who, who Thain worked


27 of 39

with, they put gold leaf in John Thain’s apartment and I was told that there was, there are a couple of French artists who put holes on some residences from French and took it apart and rebuilt it.

MG 01:15:10 01:16:14

I… uh, there are any number of apartments in 740 Park where a whole room is from ancient European mansions and villas and dachas have been bought, shipped over and recreated, that’s a kind of standard decorating play of the rich, buying a room in France and having it installed in your apartment. That’s not in any way outrageous. It’s actually fairly typical behavior. I, there were any number of decorating details, I remember Thelma Chrysler Foy who lived in the apartment directly below John D. Rockefeller Jr. had several rooms from France recreated in her apartment. And, um, buying furniture, the, any number of households in that building are addicted to what’s called FFF, Find French Furniture, um, which is generally furniture which is something with a Louie something prominence, you know whether it’s Louie the 14th, 15th, or 16th. Um, and that was, that was a, you know, 740 Park was very much of that era, nowadays people don’t want that stuff, they want sleek, they want modern, they want modernist, and fine French furniture, actually has gone down in value, possibly in direct proportion to how apartments on the east side have gone down in value as opposed to co-‐ops and glass-‐walled buildings on the Hudson river, um, but John Thain’s apartment, actually, you know, John Thain, it’s not his only residence, I think he has a house somewhere in Connecticut, which I’m sure is much larger. John Thain’s apartment…

AG 01:16:51 Is he one of those guys who does this thing, did you see Jim Stewart’s piece about people who regulate their, their days living in New York, there’s a certain number of days if you avoid living in the city you avoid paying New York City taxes.

MG 01:17:05

I think it’s 184 days to be precise. Uh, that you have to be out of new York in order to avoid New York City’s draconian taxes, which the rest of us pay, um, I don’t think that living in Connecticut is a great way to avoid taxes, I think that only works if you’re a resident of Florida where there is no in-‐state income tax, but, um, no I don’t know if that’s what Thain does, but you know, most of these people have two, three, Schwarzman has a house in Palm Beach, I believe he has a house on Long Island somewhere, he has a house in San Tropez, these people have multiple residences, um, it’s part of


28 of 39

01:19:01

their lifestyle, and they have multiple wardrobes you know they don’t travel with luggage, everything is duplicated in each of their residences so, you know, if they need that particular blue blazer, one will be there, you don’t need luggage on your Gulf Stream, you can fly without, you can travel light. Um, but, um, Thain’s apartment is actually my personal favorite for if I could live at 740 Park. And the reason why is, it’s a little, tiny jewel box duplex and it’s got four exposures and it’s on the Central Park side of the building so it has stunning views, it looks downtown, uptown, over rooftops to Central Park and the west side and it also looks east, and it’s like a one or two bedroom apartment, it’s tiny, but it’s only ever had two or three, I think three owners, and the first or second owner was a woman who followed all kinds of weird philosophical, religious cult-‐y things and lived with a guy who I think probably ran naked through the woods in Woodstock New York with a bunch of real lefties who would not fit in at 740 Park, she was just one of the weirder people it was called philosophism or something like that and then the apartment was owned by Enid Haupt who was an Annenberg heiress, um, and, and, the doorman remember that Enid Haupt would come once a week in her old-‐fashioned woody station wagon full of flowers that she had grown in her country house and she would bring them in herself and this is a fairly unpretentious apartment owned by fairly unpretentious people. I guess there’s always an exception to prove the rule. And John Thain, if you were going to draw a picture of what a scary capitalist looked like, wouldn’t it be John Thain? That sort of robotic face, I, I, wonder whether you know, I’m sure that he’s nice to his kittens and puppies.

AG 01:19:51 They all are. Somebody said to me, everyone’s nice, but, yeah, the people, who decorated for him were always just terrified, there was just something about the way he looked, he looks like …

MG 01:20:08 He looks like he should be a villain in Star Trek.

AG 01:20:13 I wanna ask you, uh, there’s a couple of nice details that I got in terms of talking to some people and I want to check your journalist’s view on some of these, um, I asked who was the, uh, I asked who at 740, I was just curious, in terms of the upstairs, downstairs, who are the best tippers at Christmas and who were the worst tippers. And I was told that the best tippers, the Englanders were great. This guy Miarcos was fantastic, worst tipper, was David Koch who apparently would


29 of 39

write people, the doorman would get every Christmas a $50 check from Mr. Koch.

MG 01:21:00 [Laughs] No, $10.99?

AG 01:21:05 Not even cash.

MG 01:21:06 01:21:49

Oh, god, well, Izzy Englander, isn’t that interesting, Izzy Englander, um, when I went to see him, you know he’s um, he runs Millennium which is this huge hedge fund and he’s a very secretive guy and at one point he paid the largest settlement ever paid to the SCC to settle some kind of securities charges against him, um, and it was shortly after that, that um, he invited me up to Millennium’s offices and he sat me down and he said, look I’ll make a deal with you, I’ll tell you everything I know about this building under one condition. You don’t even mention my name. And, I said no. Which was really easy to do because he’d only lived in the building for about three years how much could he have possibly known? Um, but he was so insistent on being invisible and I only found out later how insistent he was because one of the business magazines, Forbes or Fortune called me to ask me if I had a photograph of him because they were trying to get a picture of him and they don’t exist, no one has a picture of Izzy Englander and um, I believe they actually put someone outside of 740 Park with a long lens to try and get a picture and I bet the staff really protects him because I don’t think they ever got their photograph.

AG 01:22:38 That’s so interesting, you were talking about photographing 740 Park, we, um, yeah, we need shots of the buildings so out crew was out there on the corner taking shots of the building and we couldn’t have been out there more than five minutes when a plain clothes cop came up to me and said, ‘you guys, a lot of wealthy people live up there…’ I was like, ‘really?’ Um…

MG 01:23:07 Could I have your badge number please?

AG 01:23:11 [Laughs] I just found that really interesting.

MG 01:23:12 Oh wait, do you mind if I put you on camera saying that?

AG 01:23:18 Um, what was it… Oh, here’s a good Ezra Merkin’s story, I don’t know if you’ve ever heard this one, my guy told me this. He was in the Hamptons with his family and he forgot a hat so he made his driver go back to the city, pick it up, and go back


30 of 39

to the Hamptons at 1am.

MG 01:23:37 Are you sure it wasn’t a yamaka? The story that I believe, let me just check this for a second, hang on, um, let’s see how fast I can do this…

[TRACK 06] [cross-‐talk]

AG 01:24:06 Alright, let’s tell the Ezra Merkin story.

MG 01:24:09 01:24:18

Alright, when Ezra Merkin applied to buy an apartment at 740 Park, he showed up wearing a yamaka, his father had been the president and maybe even the founder of one of the Upper East Side synagogues and Merkin followed him, they’re very, very devote Jews. And one of the members of the board told the realtor the members of the board who had been assigned to interview him were so intimidated by the yamaka and thought he was a rabbi and didn’t want to offend him so they asked him next to no questions before they said, yes you can buy and apartment at 740 Park, probably the easiest interview ever at 740 Park. Don’t try this at home kids.

AG 01:24:52 Now the other thing I heard about Schwarzman, again, I, it can’t, I mean I have to verify wherever possible, but apparently every Christmas he would get, um, what did you say there’s 35 rooms?

MG 01:25:05 37 rooms.

AG 01:25:08 A Christmas tree for every room. Had you heard that?

MG 01:25:13 I had not. But you know, it’s, it’s perfectly over the top thing for a nice Jewish boy to do. A Christmas tree in every room, wow…

AG 01:25:24 Apparently the lobby is just almost off limits during the period where they have to bring in the massive numbers of Christmas trees.

MG 01:25:32 Well, I guess it beats John Susan Goodfriend who famously hoisted a Christmas tree up outside river house with a crane. One of the great 80’s stories.


31 of 39

AG 01:25:43 Um, oh there’s an interesting, Um, Ron Lauder has an

apartment in 740 Park.

MG 01:25:49 He doesn’t.

AG 01:25:50 With a rather spectacular art collection.

MG 01:25:52 01:26:18

Ronald Lauder lives in the apartment that James T. Lee reserved for himself when he built the building, he lives in the former James T. Lee apartment which is renown for having extraordinary, um, city and central park views, a breakfast room that you would never want to leave because of how good the views are. And I had always hoped that I would be invited into the Lauder apartment to see the art collection, um, fortunately his brother Leonard Lauder has invited me over so I’ve seen his art but never Ronald’s. As I understood it, not only was there possibly the greatest collection of German Expressionist art and Austrian art from the secession period and possibly the world but also he collects amour and he has full suits of amour in that apartment.

AG 01:26:43 Really?

MG 01:26:44 Yeah. That’s what I was told, I cannot say that for a fact, I never saw it myself.

AG 01:26:48 Did George Bush ever visit the apartment?

MG 01:26:51 I don’t know but many, many presidents have been in 740 Park or wannabe presidents. My favorite story was a woman named Mrs. Preston Davie, Mae Davie, who in her later years, I think after her husband had died, husband was some guy from Kentucky with a lot of money, but she became such an important force in the republican party, that every Republican presidential candidate had to come and kiss her ring so there was like a devotional visit to 740 Park by Eisenhower, by Nixon and apparently the last straw in Mae Davies’ life, the thing that broke her heart and lead to her death was Watergate because she couldn’t believe that Dick Nixon could’ve possibly betrayed her in that way.

AG 01:27:44 [Laughs] Um, What do we know about any political, um, important political figures going to visit 740 Park, looking to curry favor?


32 of 39

MG 01:27:53 Now a days?

AG 01:27:54 Yeah.

MG 01:27:56 Mostly the visits of important politicians to buildings like that are kept pretty secret but I do recall that just recently Mitt Romney went to kiss Mr. Schwarzman’s friends and no doubt collect a few checks. Um, it would make perfect sense for a candidate, you know, why did John Dillinger rob banks? That’s where the money is. Well, 740 Park is where the money is and in this day and age any candidate who didn’t go to 740 Park would probably be foolish.

AG 01:28:27 01:28:31

Now we talked about, or you talked about the imagination of some of these guys, the idea that they envision an America that’s long gone or maybe they’re trying to bring back, perfect free country, where you could do anything you want to do an, uh, everybody is in theory, there’s equality of opportunity, we were talking though, you know, when we first started chatting about your book, talking about the plutocracy, is there a plutocracy and is 740 Park emblematic of it if there is one?

MG 01:29:06

I absolutely think there is a plutocracy in America, you know, it, lately enshrined in that brilliant conception, the one percent, of course there’s a plutocracy in America, the problem here is that the plutocracy is not unified, it’s not as if they all share the same characteristics, you know the fact of the matter is you’ve got Warren Buffet who’s at least willing to give lip service to the idea that he should pay more taxes and then you’ve got David Koch who would probably prefer a world in which he was paid for being rich and doesn’t want to pay any taxes and doesn’t want any rules whatsoever, for David Koch arcadia is not a world of green, it’s a world of green. But, but, the fact of the matter is that there is a little tiny group and it’s probably 1% of the 1% who at this point, really do control a great deal of the world. The only thing that they can’t control is revolution. Um, and that doesn’t mean that they wouldn’t try, um, and those people are concentrated in a very small number of places. You know, ever-‐changing. So, now Beijing would be one of those places, now Moscow would be one of those places, now Mumbai is probably one of those places but New York has been one of those places since the early 19th century, it has been a world city with world-‐class fortunes and it has been a magnet for people who live in the 1% of the 1%. And, buildings like 740 Park and there are only a few of them, are the places where those people live so


33 of 39

01:32:08

you know, I recall when Occupy Wall Street, um, went on it’s tour of some of the homes of the wealthy and, um, they were standing in front of 740 Park and in, a possibly hypocrisy filled story, I read it in a blog, I don’t know if it’s true, someone got out of a black Lincoln town car and a flying wedge of New York City police man escorted this person into the building as he cursed at the protestors and someone was overheard saying, ‘You know, what do I have to do to get a police escort?’ and the answer was, ‘Be Rich!’ well you know New York City is a place where you can very comfortably be rich. Basically your feet never have to hit the ground here. It’s a city where you can live without ever having the rest of the world intrude on you and that’s why people of that ilk want to live here. Um, and, and, the thing is though that, that, there are also people who live in buildings like that who care about the rest of the world and who pay attention to the rest of the world, you know there are people who go out and do things in Harlem and in the slums and who recognize the fact that most of us are not the 1% of the 1% and they do turn a portion of their lives the betterment of everyone else lives, um, and so you can’t, as I said earlier, you can’t generalize, completely. You can generalize a lot, but there’s always going to be that exception and you know, thank god for that.

AG 01:32:52 I agree. Um, the one thing that’s interesting to me about the idea of plutocracy seems in my community which is a leafy little suburb in New Jersey, Summit.

MG 01:33:06 I was going to say, oh, well you’re in Montclair. AG 01:33:08 That’s what, that’s the joke whenever I got to parties, there

was this one really wealthy person who was horrified at what I did at one of my kid’s parties, and he said there’s conservatives in this town, wouldn’t you be happier in Montclair, he was trying to be helpful.

MG 01:33:24 Yes. As well as expel the germ from…

AG 01:33:32 But the idea was that everybody, most people in that town really only care… agree on one thing. Lower taxes. And that seems to be like, the, now you know, you pointed out Warren Buffet and maybe Gates to some extent but there does seem to be, what’s interesting to me among certain people, maybe Koch would be one Schwarzman would be one, is that they have somehow, um, intuitive or breathed in this idea that, um, rapacious pursuit of self-‐interest is a moral value. I mean it’s, it’s Ayn Rand territory.


34 of 39

MG 01:34:26 What’s interesting to me is I think that actually despite all

their similarities I think that in terms of their public face there’s a great difference between Schwarzman and Koch.

AG 01:34:37 Okay, now I’m interested in this.

MG 01:34:09 01:34:28

Koch, actually has a political philosophy, Koch is a true believer, I mean god save us from true believers, but Koch is a true believer, he believes in that libertarian philosophy and you know the interesting thing about libertarianism is that it’s where conservativism and liberalism meet in the great circle. You can be a left wing libertarian as well as a right wing libertarian and the libertarians after all are the ones who want to legalize marijuana and let you do whatever you want, which for many lefties is a good. Um, Koch has a consistent, real political philosophy and the money to not only back it up but promote it. I think Schwarzman on the other hand, his religion and his politics is money. I don’t, I’ve never heard him express a political philosophy, perhaps he’s smart enough to keep it to himself, um, you know, I mean he, he comes off as just your run of the mill republican. Now in their pursuit of business, clearly there’s something in common there. Get out of my way. Oh, look a pot of gold. And, and, that, you know, god knows it’s the American way. Or it’s, an American way. And, it’s something that should not be simply always condemned, but we don’t live in a manikin world. We don’t live in a black and white world and in fact we live in a world of infinite shades of gray that are confusing and mind-‐boggling and often very difficult to contemplate or talk about when you’re trying to tell a story because stories are so much easier when they’re black and white, but you know, here’s David Koch who’s kind of, you know, a gregarious guy, and here’s Steve Schwarzman who just can’t be bothered to be polite to someone who’s interested in him like me, I how do you say that they’re alike? They’re actually not. David Koch will take a journalist’s phone call, Steve Schwarzman will look him up and down with contempt and flick him off like a piece of dust, they’re different. Even though they’re the same, these are shades of grey that are infinitely fascinating. And, and neither way of operating, by the way, has kept these guys from getting incredibly rich, has kept them from being incredibly controversial, has kept them from being pariahs in certain circles in the city and has kept them from being lauded in others. You know there are just as many people who would crawl over broken glass to dine at Steve Schwarzman or David


35 of 39

Koch’s table as there are people who would like to see them dead.

AG 01:37:07 After writing your book did you ever go back to the building?

MG 01:37:11 Um, you know, I, I, think I went to 740 Park one time since my book came out and it was a sad occasion it was for the memorial after the funeral of someone who had lived there and um, I didn’t stay very long, I felt, been there, done that.

AG 01:37:37 01:37:58

Um, [cross-‐talk] Michael, tell me, is there, are there fun and important details that you think are relevant to my, um, enterprise that we haven’t discussed.

MG 01:38:05 Well knowing the focus, um, of what was on that list, um, you should ask me what my favorite story about a party at 740 was, but not political, but just.

AG 01:38:21 What’s your favorite story about a party at 740 Park.

MG 01:38:23

Um, there was, there’s a woman who was the center piece in the book and by that I mean she literally falls at the center of the book and the books turns on her from what I would consider the [something French] regime at 740 Park in the modern age and her name was Peggy Bedford Bangkroft and the Bedfords were a Standard Oil family and she came into the building as a standard oil heiress married to a guy named Tommy Bangkroft who was, I believe the grandson of Elsie Woodword the grand dame of New York society, um, and the, um, the first Mrs. Grandville in Dominic Dunn’s great pop boiler novel, The Two Mrs. Grandvilles. And Peggy Bangkroft was a party girl married to a stick in the mud. All Tommy Bangkroft wanted to do was work, come home, go to sleep, get up on Saturday play golf come home and he was married to a firecracker and her parties in 740 Park were legendary. And my favorite was the time that she did an Indian themed party and she brought up an elephant in the service elevator to be in the foyer greeting her guests and I thought, is there any better evocation of the ridiculous, wonderful, silliness of unlimited weather, than bringing an elephant into your apartment to greet your guests at a theme party. Um, years later, there was a, there was another hostess at 740 park, now we’re into the early 80’s, mid-‐80’s who’s name was Nancy Stodart Wong, she was a mainline Philadelphia society girl married to a Chinese-‐American finance guy. Um, very troubled marriage and he was always somewhere else doing other things. Um, and, as an act


36 of 39

01:41:02

of revenge she started having parties at 740 Park and this was kind of the, what it all devolved to, and her parties were people like, you know, McJagger, Fab Five Freddie, Blondie, the band Shique from the disco era, people like that you know, and I would imagine that large quantities of illegal substances were consumed at these parties and that you know, granted the time period you really would’ve wanted to be invited to one of them, and at some point someone on the staff of the building told the husband what was going on when he wasn’t there and that was one of the things that lead to his divorce and here’s just the oddest thing, when I interviewed this fellow, the husband, that the thing that he objected to most was that she invited black people to her parties and that wouldn’t be appreciated at 740 Park. And that, that was the reason why he had to get divorced and I thought my god, that sentiment would’ve been out of place in 1933 let alone in 2004, talking about something that had happened a mere 10 or 15 years earlier, so a party in a building like this can actually be a very telling thing. Whether it’s Peggy Bangkroft or Nancy Stodart Wong.

AG 01:41:49 Good. Anything else?

MG 01:41:52 That was, that was the one I remember from the question list, I mean like the how James T. Lee put the property together, it’s fascinating but I don’t think it is really what you’re after, you know that’s what this is. So, anything else you want?

AG 01:42:08 I don’t think so.

Blair 01:42:10 One thing.

MG 01:42:11 Hi, Blair!

AG 01:42:12 There she is, Blair, one thing, what do we want?

Blair 01:42:14 01:42:24

You do a wonderful job describing these apartments and if you could describe a little about what does it say to keep these apartments up, they’re you know – [Card Change]

[TRACK 07] [Cross talk]

AG 01:42:35 Okay, good? So Michael, just introduce this…


37 of 39

MG 01:42:38

01:43:00

Well, you know I, there’s a passage at the beginning of the book where I describe this Rockefeller, Steinberg, Schwarzman apartment and, it is the passage that, um, Fortune magazine described as jaw-‐dropping apartment porn so I thought maybe I should read it for you. “The home that linked Steinberg to the Rockefellers, apartment 15/16B was the most extraordinary apartment in New York. Its magnificence is hard to overstate. It was a Manhattan residence of unsurpassed elegance, tradition, location and proportions a real estate agent would later say. Boasting more the 20,000 sq. ft. in a city where 700 sq. ft. apartments were the norm for 32 year olds, it had, depending on who was counting anywhere from 23 to 37 rooms, the discrepancy caused by such questions is whether one included hallways and foyers the size of ball-‐rooms, servants quarters and 14 bathrooms. The entrance gallery alone was 56 feel long and 13 feet wide, larger than many New York living spaces. The 40 by 25 living room boasted eastern and southern exposures and a terrace overlooking Park Avenue. The 23 x 33 dinning room had another terrace, which could also be accessed from a small den that Steinberg converted into a breakfast room. The pine-‐paneled library was 21 x 27. Steinberg quickly decided to turn a 17 x 22 bedroom and dressing room next to it into a billiard room. It was paneled, too. Across the hall was a mirror and black lacquered bar. The 15th floor also had eleven closest, three bathrooms, and fifteen-‐foot ceilings. Tucked away in a corner behind the dinning room were the vast service quarters, a pantry, a porcelain storage room, a kitchen, a servant’s dinning room and a laundry. Up a stair outside the kitchen was the servants’ mezzanine – a low-‐ceilinged half floor with a half-‐dozen servants’ bedrooms, a storage room and two baths; Steinberg later combined several of the maids’ rooms to make them larger. Another servants’ area was directly above on 16. Originally, it had four bedrooms, two baths, and a sewing and pressing room. After Steinberg’s first renovation, the private rooms on the 16th floor would feature an astonishing 32 closets, seven bathrooms, 3 master bedrooms with attached dressing rooms, two lesser bedrooms, a sitting room, a second kitchen, a study, a gym, and a 26 ½ x 18 ½ playroom for the kids. And then there were the several more terraces on both levels, eleven working fireplaces, his-‐and-‐hers saunas, a precision-‐engineered steel entrance gate with a lacquered wood door beyond, a private elevator and a dumbwaiter


38 of 39

01:45:25

connecting the two main floors, state-‐of-‐the-‐art air conditioning, quadraphonic speakers in every room – remember, it was the 70’s – even bathrooms and dressing rooms had speakers – museum-‐quality art lighting, a customized inlaid parquet gallery, custom designed tile floors in the kitchen and pantry, and catering-‐hall-‐quality appliances, including an eight-‐burner stove and three-‐door refrigerator. In later renovations, Steinberg would add a screening room and a steam bath. The $6,528 monthly maintenance was high, that was in 1968, imagine what it is now -‐ but it was also 43% tax deductable. The rich are smart. “ Unbelievable.

AG 01:45:42 Unbelievable. While we’re on this, why don’t you say, um, just, because you said it in passing in a tone that was not about, which was not a serious tone, just say 20,000 sq. feet.

MG 01:45:56 20,000 sq. feet.

AG 01:45:58 Good, and we can cut away and cut away.

MG 01:46:01 Good.

AG 01:46:02 Okay, so Blair wanted to talk about just in general, what does it take to keep these places up, what is the upkeep on them?

MG 01:46:10

Well, if you figure that just having a studio apartment in New York is going to cost you a couple of thousand dollars a year to maintain the white, lead-‐based paint on your walls, if you’ve got custom painted everything and, you know, your child runs his tricycle into the playroom wall, you’re going to have to repaint the whole room, so that’s what? 10, 15,000? And the kinds of contractors that work for rich people know they’re working for rich people so there’s probably a rich people tax added on to that, um, I think it’s unfathomable what it would cost. The more important thing is what does it cost to run an apartment like that because think about it, you have to have staff, there have to be people working for you even in this day and age there are maids, a lot of these people have butlers, they have drivers, they have handymen, so, then there’s how much do you have to pay the staff of the building, yes, maybe some of them pay the staff of the building with nickels and dimes but there are others who probably pay them a good $10,000 as a Christmas tip. There’s the painting, there’s the cost of Air conditioning, there’s the cost of maintenance,


39 of 39

01:47:47

there’s the real estate taxes, you really do need to be incredibly wealthy. I mean if I won the lottery and I suddenly had $50 million, I could not afford to buy an apartment at 740 Park, because not only would it cost me $30 million leaving only $20 million which means that they wouldn’t let me buy it in the first place but how quickly would you run through the $20 million trying to maintain the lifestyle that you have to maintain, you can’t be poor in a building like that, or at least you can’t be poor for very long because then you’ll be very poor.

AG 01:47:56 Great.

MG 01:47:57 Okay?

AG 01:47:58 Blair, you good?

Blair 01:47:59 I’m good.

[END TRANSCRIPT]

poverty(–michaelgrossinterview–362962012( ag(00:00:07(all ... ·...

Documents