Sunday, April 10, 2016

Benmosché, Good for the Money

Of the troubled companies in the wake of the financial crisis AIG was the most troubled. It received a staggering $182.3 billion in bailout money, and few people believed it would ever be able to pay the country back. But it did. The government even turned a $22.7 billion profit on its investment. Steering the company back to health even as, by the end, he himself was fighting a losing battle with lung cancer was Robert Benmosché, the company’s fifth CEO in as many years.

Good for the Money: My Fight to Pay Back America
(St. Martin’s Press, 2016) is Benmosché’s posthumous autobiography, written with Peter Marks and Valerie Hendy. As the title indicates, the book focuses on his time at AIG. But his success at AIG would be hard to understand without knowing where he came from, how he developed his ability to say “Fuck you, I’m going to do what I want whether you like it or not.”

As a 12-year-old child he learned what it was like to live without a bailout plan when his father died suddenly, leaving behind a debt in today’s dollars of about $2.2 million that he had borrowed to build a motel in Monticello, New York. Keeping up with the payments became a family affair, and Bob, the eldest of four children, helped out managing the motel and stocking shelves in a local supermarket. A rambunctious boy with little interest in school, in his sophomore year he was shipped off to military school—the same school Donald Trump attended, a year behind Benmosché. “With hand-me-down threads, a job in the academy’s dining room and a restless spirit,” he started a new chapter in his life, though with the same aversion to academics. What interested him was making money, achieving financial freedom. What he became good at was tackling complex business issues and pointing employees in the direction of a positive outcome.

Fast forward through his years at Alfred University and various jobs at consulting firms, banks, brokerages, and eventually as CEO of MetLife. He retired at the age of 62 with the prospect of spending his golden years in the villa on the Dalmatian coast he had refurbished, tending to his vineyards in Dubrovnik and managing his investments via Yahoo Finance.

But then came AIG. That Benmosché managed to turn AIG around was something of a miracle. He had the government breathing down his neck, wanting him to sell assets quickly, even if at fire sale prices. He had an uncooperative board and a hostile chairman. The press was scrutinizing and criticizing his every move. AIG’s employees were demoralized, some had already left what they considered a sinking ship.

Benmosché called on his outsize personality (he was called crazy, scary, bombastic) and his keen business acumen to navigate the treacherous corporate and government waters. A more restrained CEO could never have made the company’s lenders whole.

Good for the Money is one of those books that has you cheering and booing. It is a fitting tribute to Benmosché’s life.

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