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Season of the Witch

(originally published by Booz & Company)

Dear Monte:

When Mel Brooks said, “It’s good to be the king,” he couldn’t possibly have foreseen what it’s like to be a CEO in America these days: pilloried in the press, persecuted by Congress, portrayed as Public Enemy Number One by the president himself.

Your 9-year-old, Monte Jr., seems to have learned (at his luxe private school) that “capitalism is evil” (even as he asks, “Daddy, are we going to lose our house?”), while your 31-year-old — the movie auteur turned restaurateur turned spec home builder — has come begging for a loan, which you call a bailout and he insists is a stimulus package.

Still, there are some bright spots here. The founders’ twin sons (AmSmelt Directors Otto and Carl) are rumored to be angling for posts in Commerce and Treasury. So at the moment, they’re not pouring acid into everyone’s ears about your ability to run the company. (Why anyone would submit to the vetting process is beyond me. But I suppose that if you’re averse to paying taxes and miss flying around in
private jets, a government job is the way to go these days.)

And then there’s the big question you left on my voice mail. You have a chance to acquire ConSmelt, the second-largest smelting firm in the U.S., at fire-sale — or, if you prefer, post-meltdown — prices. This would leapfrog AmSmelt into the number one position.

Ordinarily, in vetting these things, the motto is “It’s not personal. It’s business.” But in this case, there’s a history. You worked for ConSmelt. You and Ted Perkins were rivals to become CEO. He won the bake-off; you left, and you landed at AmSmelt. But it wasn’t pretty. And now, whereas you’ve held your own in the crisis, he’s in deep trouble: He bet wrong on magnesium futures, through a financial-services unit that held lots of nonfunctioning mortgage derivatives. Either he sells the company or he’ll have to go begging the government for TARP funds. And the last thing he wants is for anybody to question his financial acumen. Or his compensation package.

From a PR standpoint, my advice is to go for it. Don’t gloat. The mantra: You’re not getting even. You’re saving jobs, and a vital strategic industry.

Monte, Monte, we both know the larger truth here: When the chaos is over, a new group of CEO superstars will emerge, just as they do after every crisis (American Airlines’ Bob Crandall from the first oil embargo, Jack Welch from the early 1990s recession, Jeff Bezos from the dot-com bubble). The press needs heroes. So does the public. And when the time is right, you’ll be there for your moment in the spotlight.

I’ll be in touch —

The Biffster

PS: I’ve just heard from Perkins’s PR guy, who said he’s amenable to the acquisition, but insists on taking credit for it in the press. My take? Make him give up his exit bonus in return for keeping his dignity, and everyone gets to avoid playing rope-a-dope at a congressional inquiry. Yr thoughts, pls. 

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