Et tu, Frank?
Until this spring, Maurice (Hank) Greenberg was chairman and chief executive of American International Group, the giant insurance company he had run for almost 40 years. In March, the board of A.I.G. fired him, after the company found itself under investigation by federal regulators for its accounting practices. The director who led the ouster? Mr. Greenberg’s close friend of 30 years, Frank Zarb, who had been invited onto A.I.G.’s board by Mr. Greenberg. According to The Wall Street Journal, Mr. Greenberg was shocked to find himself stabbed in the back by a trusted friend and confidante.
Mr. Zarb claims he was simply acting in the best interests of the shareholders, but it looks more like he was acting in the best interests of Frank Zarb. Indeed, Mr. Zarb is now A.I.G.’s “acting chairman” and has shown no hesitation about marching in to fill the power vacuum which resulted from the dismissal of Mr. Greenberg, and has made several decisions to put his own stamp on the company. While it’s true that Mr. Greenberg made enough mistakes as C.E.O. to arouse the interest of the New York Attorney General’s office and the Securities and Exchange Commission, that doesn’t forgive Mr. Zarb’s self-serving treachery and betrayal.
Frank Zarb, a Hofstra University graduate, started his career as a mediocre back-office clerk, and leapfrogged the system on the shoulders of industry superstars such as Hank Greenberg, Sandy Weill and Felix Rohatyn. Mr. Zarb met Mr. Greenberg in the 1970’s, when as a banker at Lazard Frères he did some business for A.I.G. Throughout their long friendship, which included trips abroad with their wives, Mr. Greenberg used his influence and power in the business world to help his friend progress professionally. As The Journal reports, in 1993, when Mr. Zarb was passed over for a top position at Smith Barney, Mr. Greenberg suggested to an insurance brokerage firm, Alexander & Alexander, that they hire Mr. Zarb as chief executive, which they promptly did. (A.I.G. had recently provided Alexander & Alexander with a much-needed $200 million investment.) When Mr. Zarb sold the company, he pocketed $23 million in severance.
Mr. Greenberg was always willing to help: In 1994, Mr. Zarb asked him if a charitable foundation associated with A.I.G. might make a donation to Hofstra, which was going to name its business school after Mr. Zarb. Mr. Greenberg agreed and directed $4 million for the school’s construction and the endowment of a faculty chair.
In 2001, Mr. Greenberg made the fateful decision to ask Mr. Zarb to join A.I.G.’s board, as chairman of the executive committee. In an atmosphere of trust, the two men began to have private meetings to discuss the issue of succession: what to do if Mr. Greenberg became ill or died. In 2003, they agreed that if Mr. Greenberg became incapacitated, Mr. Zarb would assume his duties temporarily and follow his wishes in terms of choosing a more permanent successor.
But early this year, federal investigators started taking a long look at A.I.G. The mistakes and misdeeds of Hank Greenberg terrified a board whose members were afraid of losing both money and reputation. This provided the perfect storm for the treacherous Mr. Zarb to stage a palace coup and achieve his goals, fueled only by greed and ambition. Naturally, this was all under the guise of fiduciary responsibility to shareholders, blah, blah, blah.
And so Mr. Greenberg was out as chairman and C.E.O. Mr. Zarb’s blind ambition and lust for power must have obliterated all feelings or even thoughts of loyalty and friendship.
Caesar had his Brutus; Hank has his Frank.
Joel Klein Has The Right Stuff
There was a time when New York’s public schools were a symbol of an education system that rewarded incompetence, tolerated corruption and encouraged mediocrity.
Those days may be numbered.
The number of fourth-graders in city public schools who meet state standards in reading and writing increased by nearly 10 percent this year. About 60 percent of the city’s fourth-graders met the state standard in English Language Arts. But that doesn’t begin to tell the story. Some schools in poor sections of the Bronx-another symbol of the bad old days-saw huge, double-digit improvements.
This is tremendous news for New York. Just as Rudolph Giuliani proved that New York City was not, after all, ungovernable, Mayor Michael Bloomberg, Schools Chancellor Joel Klein and thousands of teachers, parents and students are demonstrating that our schools are not unworkable.
The results in the Bronx are striking, particularly in District 9, which showed the largest gains in the city. For several years, the district was plagued by corruption among its school board and administrators (one elementary-school principal was arrested for possessing crack cocaine), and the student scores were the worst in the city. But the district pulled together under the leadership of Irma Zardoya, the regional superintendent, who worked together with the Institute for Education and Social Policy at New York University, as new principals were hired and top teachers were paid extra to mentor colleagues. The results speak for themselves.
Mr. Klein deserves the praise and admiration of all New Yorkers. Very quietly, he has presided over a revival in New York’s vast public-education system, and has shown the courage to do whatever it takes to achieve positive results. He hasn’t allowed himself to become captive to the bureaucracy or to special interests.
Yes, New York’s public schools still have a way to go. But who can deny that we are heading in the right direction?
Troubled Tykes
The nation’s toddlers are running wild. According to a new study by the Yale Child Study Center, 3- and 4-year-olds are three times more likely to be expelled from school as children in kindergarten through 12th grade. That works out to about 5,000 adorable urchins who are being given the boot each year. What’s going on?
The study didn’t specify which behaviors led to the expulsions, though the study’s author said it generally involved cases where a child was being aggressive toward classmates, or endangering his or her own safety. Boys were tossed out 4.5 times more than girls, and 4-year-olds were more likely to be expelled than 3-year-olds. Overall, the rates were twice as high in classrooms where the teacher had no support from a child psychologist or psychiatrist. New York State came in 12th highest out of the 40 states studied, with preschoolers being 18 times more likely to be expelled than K-through-12 students, indicating the problem here is significantly worse than in most other states.
There’s much speculation about the cause: parents who aren’t doing enough at home to discipline their children, combined with more kids being sent to preschool because both parents are working.
But it’s interesting to note that expulsions were lowest in public and Head Start schools, and higher in faith-based and private schools, which tend to place more emphasis on academic achievement and standardized tests, even at the preschool level. Placing academic expectations on 3- and 4-year-olds-when what they really need are social skills and playful, low-stress learning games-may be a big reason why so many children are acting out. As any parent knows, a child will always tell you, in one way or another, what he or she needs. And thousands of toddlers seem to be sending a clear message, that teachers and parents are pushing them too hard, too fast, when all they really need is to learn how to share a toy with the kid across the room. Then again, that’s a lesson many adults have yet to learn.
