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American Morning

Interview with Andy Borowitz, Joe Queenan

Aired August 08, 2002 - 07:32   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
PAULA ZAHN, CNN ANCHOR: Federal investigators appear to be trying to make a case against Martha Stewart, the "Wall Street Journal" reporting this morning that a Merrill Lynch employee may be willing to testify against Stewart in exchange for immunity in the Imclone insider trading scandal. Stewart's friend, the former head of Imclone, Samuel Waksal, was indicted yesterday, accused of tipping off family members to sell their Imclone stock before the public learned that its cancer drug would not receive federal approval. And those charges came amid reports that ex-Tyco CEO Dennis Kozlowski pocketed millions in company cash to finance his own lifestyle.

They are prime examples of alleged corporate greed and the behavior portrayed in the movie "Wall Street."

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: When does it all end, huh? How many yachts can you water ski behind? How much is enough?

UNIDENTIFIED MALE: It's not a question of enough, pal. It's a zero sum game. Somebody wins, somebody loses. Money itself isn't lost or made, it's simply transferred from one perception to another.

(END VIDEO CLIP)

ZAHN: And joining us now to talk about America's CEOs and whether they're getting a bad rap, Andy Borowitz, a political satirist, and from Washington this morning, Joe Queenan, contributor to "Forbes" magazine.

Good morning all.

Nice to have the two of you with us.

ANDY BOROWITZ, POLITICAL SATIRIST: Good to be here, Paula.

JOE QUEENAN, "FORBES" MAGAZINE CONTRIBUTOR: Good morning.

ZAHN: First off, Joe, your reaction to the "Wall Street Journal" report this morning about Mr. Faneuil perhaps turning on Martha Stewart?

QUEENAN: I think it's great because even though there's probably 200,000 other people who have done exactly the same thing Martha Stewart has done, she's the most annoying person and the most high profile person who's being investigated. So that sends a message to the rest of the world that even seemingly innocent homemakers in Connecticut will be prosecuted vigorously if they're involved in any kind of insider trading.

ZAHN: So, Andy, it makes sense to you that her stock would simply fall $360 million in value just based on what appear to be right now allegations?

BOROWITZ: Well, right now it's sort of like Sam Waksal and Martha Stewart are sort of conjoined twins as far as the Department of Justice sees them. It's going to be up to her lawyers to kind of separate them, I think. But a perp walk for Martha Stewart, we don't know if she's done anything wrong, actually, but a perp walk for her could really get the market back up over 10,000, I think. ZAHN: That much glee out there on Wall Street about something like that happening, Joe?

QUEENAN: I think that the thing that's interesting is that all of the talk about greed is about Martha Stewart, about Waksal and about the CEOs. But you have to remember that the investors bear a lot of responsibility for this, too. It was clear that the stocks weren't worth what they were trading for. It's clear historically that you don't get 20 percent return on your money. So all the stuff about how greedy the CEOs are -- and, of course, they are -- but the public has to bear some responsibility, including people like me. I didn't sell my stocks at the top because I figured they could go up another 40 percent.

ZAHN: And yet do you think the public was ever aware of the details that it is aware of today, let's say, for example, of Tyco Chief Dennis Kozlowski and how his personal expenses allegedly were, you know, paid for by company funds?

BOROWITZ: I was quite offended by that because I read in the "Wall Street Journal" that L. Dennis Kozlowski had a $6,000 shower curtain. And I think a CEO should be able to make do with a $3,000 shower curtain. ZAHN: You'd probably get a lot of agreement out there on that one.

BOROWITZ: Absolutely.

ZAHN: Joe?

QUEENAN: I think that the thing that's interesting here is that the media doesn't report on the $6,000 shower curtain until the stock has gone down. As long as the stock is trading at about 100 times earnings, nobody cares how much money these people waste on anything. But as soon as the stock goes down, then the shower curtains are unacceptable.

And my feeling is basically CEOs out there, you know, I own stock in Intel and Microsoft. I don't care how much you spend on the shower curtains, just don't cook the books and just keep the earnings coming.

ZAHN: I think you raise a very valid issue when you talk about the glory days of the CEOs being over, because in many ways people still do honor the CEOs whose companies are making a lot of money, Andy.

BOROWITZ: Well, Joe is right. But, you know, when you get a couple of bad 401K statements, everybody turns into a Bolshevik, you know, and we're ready to sort of storm the palace. So we are a part of that culture of greed, absolutely. But now we're mad because we're not flush anymore.

ZAHN: And where do you see this going from here, Joe?

QUEENAN: I actually see it going back. We're going to have about three years where we think CEOs are absolutely horrible, like Gordon Gecko (ph). Then somebody like that guy from Chrysler, Iacocca, somebody kind of like that will come back, write a popular book, make a lot of money. All the stocks will go up. We'll talk about him being president. That will last five years. He'll be discredited. Eight years from now we'll be back having this same conversation, except the shower curtain will now cost $50,000.

ZAHN: But it will still be burgundy and gold?

BOROWITZ: Yes, I think the SEC will act tough right now. They'll pass a law that says no CEO has the right to live like Mariah Carey. And that will be sort of a Band-Aid.

ZAHN: How important, though, is it, Joe, in the end for the American public to see these men and women who have been accused of -- whether it's insider trading or whatever the, you know, crime is of the week, to be sent off to jail?

QUEENAN: It's important to see them in handcuffs, at least, because then they're humiliated. Rudy Giuliani pioneered that technique back in the '80s when he went after Milken, when he went after all the insider traders. He knew that even if you didn't get to put these guys in jail, at least you humiliated them. They couldn't show up at the golf club anymore because they had been in handcuffs.

Symbols are really important to the American people because all we're going to get back is the perp walk. We're not getting our money back. ZAHN: You love the perp walk, don't you, Andy?

BOROWITZ: Well, I think the perp walk has replaced interest rate cuts as a way of moving the markets. I mean I'm sure that Alan Greenspan is saying do I cut 50 basis points and do two perp walks or do I cut 100 and do one perp walk? I think it's just part of the equation now.

ZAHN: Thank you both for your perspectives this morning.

BOROWITZ: Thank you.

QUEENAN: Thank you.

ZAHN: Andy Borowitz, Joe Queenan. Glad to have both of you with us.

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