New York Times columnist and editor Andrew Ross Sorkin spoke to an audience of students and community members in Salomon 101 yesterday. After the lecture, he sat down with The Herald.
Herald: You started writing for the New York Times when you were in high school. Emotionally and in terms of the experience, what was that like for you?
Andrew Ross Sorkin: Emotionally? I couldn't believe it. I probably still can't believe it. For me, ultimately, it was the best education I ever had. I've been writing for the paper in high school, and in high school — that's probably where I learned to write if I can at all. I was 18 years old, and I had an article in the New York Times. I never thought that was even possible. I was always very grateful to the organization for even having me.
Herald: And did you always know you wanted to be a journalist?
Sorkin: I wasn't sure I wanted to be a journalist. I always knew I was fascinated by media. I used to watch ridiculous amounts of television — my mother used to try to turn the TV off. And I read the New York Times. It was almost religious in terms of rushing to get the paper in the morning back in high school. So, yeah, I don't know if I wanted to be a journalist immediately, but I definitely think that that experience was obviously what set the whole course for the rest of my career, and I got the bug pretty quickly.
Herald: And then how did you move to finance?
Sorkin: Finance was a bit of a luck out. I started originally working for Stuart Elliott, who was the advertising columnist which was in the business and finance section. So I knew a lot of the finance editors and all of that. And it really was what happened in my junior year and when I graduated, which was I was asked to write about British business. And that was sort of my initial role was writing about, you know, the business world in the UK. And then, you know, what really happened was 1999 was sort of the peak of the mergers and acquisitions boom, and so all of a sudden I was covering the world of deal-making and Wall Street and all these high-flying people and things.
Herald: Moving from there to things you discussed in the talk, the first, most obvious question: Do you think the 2008 bailouts were necessary?
Sorkin: Yes — I'm a believer that the 2008 bailouts were absolutely necessary and that we would have been living in a very different world today without the bailouts. Having said that, and it's something we didn't get to discuss enough tonight — you know, I could quibble, I could argue really with sort of how the bailouts were executed. Meaning, would I have liked to see more strings attached to the bailouts? No question.
Herald: What kind of strings?
Sorkin: This becomes much more complicated — probably not a great quote. The question to me becomes, could have you received more preferential treatment on the shares? Meaning, did it have to be structured as a loan? As the value of the banks has increased, should have taxpayers received more? What kinds of regulatory efforts — could you have implemented a program where if you received the loans you can't lobby? There's no lobbying, which would have meant that it was much harder to push back on so many of these regulations. Would people say, could have you implemented something on compensation if that was your issue? Could have you had more control over capital requirements? Could have you had more control over loans? But then you get into all these other questions about do you want the government doing these things? How effective is the government really at some of these things? I'm not so sure that they're so brilliant at it either. So it's complicated because, as you see — part of it is, I love all these regulations, but then you spend some time with these people in Washington who have to execute the regulations and you go, well this is not going to work so well either. That's why I say it's complicated. And the last piece on that is had you added all of these strings, it's unclear to me if the banks would have taken the money voluntarily, even though I know that sounds ridiculous because you would have thought they need the money. Some of them wouldn't have thought they needed the money.
Herald: Ultimately, what factors do you think led to the banks needing the bailouts?
Sorkin: Oh, God. I mean, ultimately, as I said during the talk, it really is about leverage. It's about the debt that was built into the system and the idea that these firms were leveraged at 30 and 40 to 1. But, you know, we can talk about deregulation, housing policies were part of it, the Fed and keeping interest rates at remarkably low levels, the conflicted rating agencies, the regulators who weren't minding the store and all the bankers who took advantage of it. There's so many — if you want to know how we got here, all of those things happened. It was a perfect storm, except that it was man-made.
Herald: Moving toward something you alluded to a lot and that's a lot more current, the Eurozone crisis. What are your thoughts about resolving it? What can be done, what should be done, what will be done?
Sorkin: My expectation is that we're going to keep kicking the can down the road. That ultimately, there will be no plan until they have to come up with a plan. And to me it's hard to believe that they create truly closer ties or the idea that they'd really create a sort of United States of Europe. I have a hard time believing that some of these countries are going to be willing to give up their sovereignty.
Herald: You spoke a lot about what we didn't know about the banks during the financial crisis and then how if we had known more it could have caused a panic of some sort. Do you think we should have been told more?
Sorkin: This to me is the question, and I have yet to come to terms with it. As a journalist, I'm a believer in transparency. I want to know. But I'm also cognizant that knowing can become a self-fulfilling prophecy. But if we knew, would it have solved things? Maybe it would have forced people's hands to do things quicker than they did, but it also might have caused a run earlier than it did. I go back and forth on this. I probably didn't come back to it because ultimately I didn't have a satisfying answer. It's a very tough one because you want to know, but if you knew what you knew, what would happen. The journalist in me says you're supposed to know, but — anyway.
Herald: You talked about all the factors that led to the need for the bailouts. Do you think there was any group to blame for the financial meltdown?
Sorkin: Oh, I think everyone that I just mentioned before, absolutely. The problem — and I think that the reason why people are so frustrated — is because there is so much blame to go around and people like to have a nice, neat, one person or one group kind of person to blame. Do you know what I mean? People are always looking for that one — the poster boy. And I think that this particular crisis, given how complex it was, had so many —
there were so many fathers to this crisis that in a way it's unsatisfying because it's so hard to just pin the blame on one individual or group.
Herald: I know a lot of students touched upon this in the Q&A, but how do you think we should move forward as a country from everything that's happened so far?
Sorkin: I think it's sort of a little bit of what I said. I think we're going to need patience. We need to find a way to grow, we need to find a way to cut, we need to stop thinking so short-term. And all of that's going to be painful along the way, and that's the hardest part for us to accept.
Herald: As a side-note, I read that you had a cameo in the "Too Big to Fail" movie. Was that fun? What was that like for you?
Sorkin: Oh, it was very cool. It was very cool, but you know, for four seconds or whatever it was of screen time, I swear it must have taken eight hours. But no, filmmaking was a lot of fun. It was one of the great highlights of my career — not the cameo so much, but being part of the filmmaking process and seeing something you've worked on be with the kind of actors that we had was extraordinary. I still can't get over it. But I only had one line in the movie, and as William Hurt is happy to tell you, at least once I think I screwed it up.
Herald: What was the line?
Sorkin: Oh, don't ask me now. Mr. President — what was it? Something with the AIG bailouts or the Lehman bailouts. I don't even remember, that's how bad it is. William Hurt will read this and chuckle.
Herald: After tonight's talk, do you have any advice for Brown students — about journalism, finance, anything?
Sorkin: The only thing I've learned in my whole career is about try and find — I mean, it's so cheesy to say try to find your passion or try to find something that you really love to do, because I think the people that I've found that have had the most success in what they're doing, they really live it. They really breathe it. It is their life. And I think the hardest part — I was lucky in that I found my passion and what I loved to do very early. I think the great challenge is that there are so many people who are not sure what they want to do, and I think the answer to that, if there is one, is honestly to keep trying as many different things until you hit it. I just think you got to keep hustling. And it's about the hustle — you've got to hustle. It doesn't happen. I wish it happened as easily as, I'm sure all these things look easy, but they never do. They never are.
