Crichton Risk (n) – A plausible, yet improbable risk scenario that could easily serve as the premise for a Michael Crichton novel, such as space junk crashing to earth carrying lethal viruses; nanobots running amok; genetically engineered dinosaurs eating theme park visitors. E.g. “The Large Hadron Collider accidentally turning the Earth into a black hole is one hell of a Crichton risk.”
So you’re saying the Russians have these, uh, Shoggoths, but we don’t have any. And even those dumb Arab bastards in Baghdad are working on them. So you’re saying we’ve got a, a Shoggoth gap? A strategic chink in our armour? And now the Iranians say the Russians are using them in Afghanistan?
–Charles Stross, A Colder War
It takes a lot of nerve to write a paragraph like that with a straight face. What’s a shoggoth, you ask? If you don’t already know you ought to quit reading now. Neither A Colder War nor this review are meant for you.
Charles Stross’ novelette (available online here) imagines the Iran-Contra scandal in a world where H.P. Lovecraft’s entire Cthulhu Mythos is real. Not much more to it, really. Rest assured there is a plot. I won’t describe it here because frankly A Colder War is at its best sketching the impact of Lovecraftian horrors on Cold War politics. Readers ought to have the pleasure of discovering that for themselves.
Stross combines a strong voice with deadpan humor and more Lovecraft references than you can shake a shoggoth at. The quote at the top of this post is one example. If you’re not satisfied with that, here’s another:
“It is not the Russians that we quarrel with,” Mehmet says quietly, “but their choice in allies. They believe themselves to be infidel atheists, but by their deeds they shall be known; the icy spoor of Leng is upon them, their tools are those described in the Kitab al Azif. We have proof that they have violated the terms of the Dresden Agreement. The accursed and unhallowed stalk the frozen passes of the Himalayas by night, taking all whose path they cross. And will you stopper your ears even as the Russians grow in misplaced confidence, sure that their dominance of these forces of evil is complete? The gates are opening everywhere, as it was prophesied. Last week we flew an F-14C with a camera relay pod through one of them. The pilot and weapons operator are in paradise now, but we have glanced into hell and have the film and radar plots to prove it.”
If there is a downside to all this it’s that A Colder War is essentially one big gimmick (albeit a very enjoyable one). The story doesn’t feel fully fleshed-out, especially in comparison to Stross’ later Laundry novels. The novelette also ends abruptly, as if afraid to wear out its welcome.
Finally, it requires at least passing familiarity with Lovecraft’s fiction to enjoy. I can’t imagine someone ignorant of “At the Mountains of Madness” and “Call of Cthulhu” would get much out of A Colder War. As I mentioned above, half the fun is spotting the Lovecraft references. The average reader may simply find the whole thing bewildering.
If history and Lovecraft are up your alley, however, you owe it to yourself to spend an evening with A Colder War.
I literally just finished Barbarians at the Gate, by Bryan Burrough and John Helyar. I mentioned it previously in my “five favorite business books” post. On the face of it this is a book about KKR’s $25 billion leveraged buyout (LBO) of RJR Nabisco in 1989 — the largest such deal in history at the time.
Really, though, Barbarians at the Gate is the epic, sweeping tale of a seismic shift in American corporate culture. It’s the Game of Thrones of business books. Minus the creepy incest subplot, of course.
The LBO had its heyday in the 1980s. For those unfamiliar with the term, an LBO involves a partnership of some sort, usually involving private equity in some form, buying all the outstanding shares of a public company to take it private, in many cases with the help of a sympathetic management team. “Hostile” deals happen when management is not so sympathetic.
In this context “leverage” is really just a fancy word for debt. The idea is to take a strong company with a “low” stock price (e.g. a stock price management and others feel is undervalued) and buy it back at something more akin to its “true” (higher) value. Obviously this can get expensive in a hurry. So you fund the deal with debt. Lots and lots of debt. In the ’80s when the RJR deal happened, the bulk of this debt came in the form of high-yield bonds, more commonly referred to as “junk bonds.”
On the face of it everyone wins. Investors get a premium for their shares. Friendly management often gets a handsome payout — and sometimes keeps control of the newly-private firm. The investment banks and law firms that advise on the deals and line up the financing get massive fees for their efforts. In the RJR Nabisco deal, for example, Drexel Burnham Lambert earned over $200 million for arranging a $3.5 billion bridge loan.
As much as Barbarians at the Gate is about a specific deal, it is also about a massive shift in coprorate cultures that occured in the 1980s. It was no longer okay to simply run a stable business with a steady hand. Investors and managers wanted to earn. Barbarians at the Gate tracks an enormous cast of characters with varying ambitions. In fact ambition is the common denominator for all cast members. RJR Nabisco’s CEO, Ross Johnson, lived by the motto “a few million dollars are lost in the sands of time.”
This excerpt pretty well sums it up:
In its final decade Reynolds had become less a great copmany than a great dream machine. Its torrent of tobacco money allowed egos to run wild and fantasies to become true. Paul Sticht could walk with kings. Ed Horrigan could live like kings. Directors could be treated like kings.
Hoisted onto the auction block, the company became a vast prism through which scores of Wall Streeters beheld their reflected glories. Jim Maher could restore First Boston’s greatness. Ted Forstmann could pursue his final jihad. Peter Cohen could go from administrator to merchant-banking prince. Henry Kravis could have an empire’s crowning touch. John Gutfreund could get the left side of the ultimate tombstone.
The founders of both RJR and Nabisco would have utterly failed to understand what was going on here. It is not so hard, in the mind’s eye, to see R.J. Reynolds and Adolphus Green wandering through the carnage of the LBO war. They would turn to one another, occasionally, to ask puzzled questions. Why did these people care so much about what came out of their computers and so little about what came out of their factories? Why were they so intent on breaking up instead of building up? And last: What did this all have to do with doing business?
This reads a lot more ominous in the wake of the 2008 financial crisis. It’s precisely the kind of thing that gets people’s blood pressure up: the idea that Wall Street is a casino run for a few insiders’ and egomaniacs’ benefit.
Perhaps then it’s instructive to note that the RJR Nabisco LBO marked the high water mark in most of the key players’ careers. From the book:
“The great money machine behind LBOs — junk bonds — sputtered and for a time virtually stopped. Mike Milken went to jail; Drexel Burnham went bankrupt […]
[…] Henry Kravis ceased stalking big game, preoccupied with the care and feeding — and debt service — of RJR. John Gutfreund was ousted as chairman of Solomon Brothers in 1991, after a treasuries trading scandal. His president, Tom Strauss, also resigned at joined Peter Cohen in obscurity at a hedge fund.”
It may be a bit over-egged, but reflecting on Barbarians at the Gate now I am reminded of a quote from Akira Kurosawa’a Ran:
We too are children of this age…weaned on strife and chaos. We are your sons, yet you count on our fidelity. In my eyes, that makes you a fool.
Something that’s always driven me crazy is writers who think of writing as a “calling” and not a business. Sure, you may think of writing as a passion. But if you want anyone else to read what you’ve written your passion is eventually going to collide with someone else’s business interests. Elmore Leonard put it this way:
I think any writer is a fool if he doesn’t do it for money. There needs to be some kind of incentive in addition to the project. It all goes together. It’s fun to sit there and think of characters and get them into action, then be paid for it. I can’t believe it when writers tell me ‘I don’t want to show my work to anybody.’
Perhaps predictably, James Ellroy expressed his opinion even more colorfully:
L.A. Confidential, the movie, is the best thing that happened to me in my career that I had absolutely nothing to do with. It was a fluke—and a wonderful one—and it is never going to happen again—a movie of that quality.
Here’s my final comment on L.A. Confidential, the movie: I go to a video store in Prairie Village, Kansas. The youngsters who work there know me as the guy who wrote L.A. Confidential. They tell all the little old ladies who come in there to get their G-rated family flick. They come up to me, they say, “OOOO… you wrote L.A. Confidential…. Oh, what a wonderful, wonderful movie. I saw it four times. You don’t see storytelling like that on the screen anymore.” … I smile, I say, “Yes, it’s a wonderful movie, and a salutary adaptation of my wonderful novel. But listen, Granny: You love the movie. Did you go out and buy the book?” And Granny invariably says, “Well, no, I didn’t.” And I say to Granny, “Then what the fuck good are you to me?
I try to read both fiction and non-fiction. Most of my non-fiction reading is history. But sometimes I also read business books (e.g. The Little Book of Valuation, Secrets of Question Based Selling). Sometimes I even read books that are a little of both. Here are my five favorite business books, in no particular order:
- The Smartest Guys in the Room by Bethany McLean – The rise and fall of Enron in epic fashion. Also a powerful illustration of how divergent accounting earnings and business can become when investors, analysts and media fall prey to hype.
- When Genius Failed by Roger Lowenstein – This is the story of the world’s most famous hedge fund meltdown, and an example of “experts” being too smart for their own good (see also #5 below).
- Barbarians at the Gate by Bryan Burrough and John Helyar – Specifically this is a book about the leveraged buyout of RJR Nabisco. But in a much broader sense it’s also about the massive change in corporate cultures that occurred in the 1980s, and how dangerous it is for successful organizations to allow stability to turn into complacency.
- The Prize by Daniel Yergin – Everything you would ever need (or want) to know about the history of the oil business.
- Fooled By Randomness by Nicholas Nassim Taleb – More of a collection of essay-like musings, Taleb argues evolution has programmed us to make really poor financial decisions.
…the beating heart of this novel is philosophy, and if I may borrow an analogy from Professor Stephen Law, at times Anathem is not so much a work-out in the philosophy gym as philosophy extreme sports. The history of the avout is punctuated by the breakthrough ideas of saunts, all of them replicating concepts familiar to us here on Earth through Plato, Euclid, Leibniz, Newton and so on. Edmund Husserl’s copper ashtray becomes Atamant’s Bowl; Occam’s razor becomes Saunt Gardan’s Steelyard. This is more than mere facsimile: the most powerful and controversial idea among the avout concerns the “Hylaean Theoric World”, and the question of whether the same ideas will occur independently to thinkers on different planets because there are certain transcendental truths – prime numbers, the value of pi, the laws of geometry – that exist on some higher plane. Taking his cue from the likes of Hugh Everett and Max Tegmark, Stephenson postulates that, while certain conditions are necessary for the cosmos to have taken shape (various laws of physics, such as the speed of light, having to be set at very precise values), there is still room for tiny variations in those values to create parallel cosmoses in which the make-up of matter is minutely distinct. It is the many worlds theory evoked with a greater elegance than I have read in any previous work of “speculative fiction”.
I needed a break from Stephenson after I walked away from REAMDE. I loved Cryptonomicon and Snow Crash. I really wanted to like REAMDE, too. Don’t get me wrong. There were certainly flashes of brilliance in that novel (particularly when Stephenson delved into story behind the novel’s World of Warcraft-like MMORPG, and his use of ransomware as a major plot point). Aside from that, however, REAMDE came up way short on the heavy ideas that make Stephenson’s best fiction so enjoyable.
This does not look like it’s going to be a problem with Anathem.
My favorite Mario Puzo book is not The Godfather. Instead it is Fools Die. At first glance you might think Fools Die is a rambling chunk of literary fiction that is more a catalogue of events than an actual novel. However, this structure is quite appropriate because in all actuality Fools Die is about randomness.
Perhaps nothing illustrates this point better than the scene where the casino boss, Gronevelt, takes one of the characters out for an educational gambling binge (only in describing a novel like Fools Die could I write a phrase like “educational gambling binge” with a straight face):
Cully remembered one period in the history of the Xanadu Hotel when three months straight the Xanadu dice tables had lost money every night. The players were getting rich. Cully was sure there was a scam going on. He had fired all of the dice pit personnel. Gronevelt had all the dice analyzed by scientific laboratories. Nothing helped. Cully and the casino manager were sure somebody had come up with a new scientific device to control the roll of the dice. There could be no other explanation. Only Gronevelt held fast.
“Don’t worry,” he said, “the percentage will work.”
And sure enough, after three months the dice had swung just as wildly the other way. The dice pit had winning tables every night for over three months. At the end of the year it had all evened out. Gronevelt had had a congratulatory drink with Cully and said, “You can lose faith in everything, religion and God, women and love, good and evil, war and peace. You name it. But the percentage will always stand fast.”
[…] By the middle of the second week, Gronevelt, despite all his skill, was sliding downhill. The percentages were grinding him into dust. And at the end of the two weeks he had lost his million dollars. When he bet his last stack of chips and lost, Gronevelt turned to Cully and smiled. He seemed to be delighted, which struck Cully as ominous. “It’s the only way to live,” Gronevelt said. “You have to live going with the percentage. Otherwise life is not worthwhile. Always remember that,” he told Cully. “Everything you do in life use percentage as your god.”
If there’s a practical lesson in all this it’s don’t play the lottery. But I think there’s something vaguely spiritual going on here. Maybe a super dysfunctional kind of zen (oxymoron, anyone?). In the words of the Greek statesman/philosopher Solon: “let no man be called happy before his death. Till then he is not happy, only lucky.”