A Lesson in Personal Responsibility

Larry Elder

11/1/2007 12:01:00 AM - Larry Elder

Two weeks ago I arrived at San Francisco airport. The young, attractive, personable black woman at the rental car desk wore a badge that said "Trainee." I smiled and said, "That's an odd name." She laughed. I asked whether she was from San Francisco. She replied, "No, I'm not from here. I'm from Atlanta."

"Why are you here?" I asked.

"Well, I moved back with my parents here in town."

"I thought you said you were not from here."

"Well," she said, "I'm from here, but I went to school in Atlanta, and I prefer it there. So I consider it my home."

"What were you doing in Atlanta?" I asked.

"I attended Clark University, but after a couple of years I got pregnant, so I came home."

"Are you in school now?"

"No, because the money's too good."

"Too good to remain in school?"

"For now," she answered.

"What is it you don't like about San Francisco?"

"It's just so racist," she said.

"Racist? Isn't this one of the most liberal cities in the country?" I asked. She rolled her eyes.

"Sign here," she said. "You know, I should have finished my training program some time ago, but because I'm black, they're making me stay longer."

"How do you know it's because you're black?" Another roll of the eyes.

As I was leaving, I said, "You know, given your people skills and your drive, whatever obstacles others place in your way, you'll be able to overcome them."

"Wait, what do you mean?"

I turned around. "I mean that given your charm and your apparent drive, I'm sure you'll be able to deal with -- and maybe even turn around -- anybody who gets in your way."

"You think so?" she asked.

"I know so."

Which brings us to Stanley O'Neal, the recently ousted black CEO of Merrill Lynch.

Who is Stanley O'Neal? Born in segregated Alabama in 1951, O'Neal spent his early childhood delivering newspapers, picking corn and cotton on the family farm, and being educated in a one-room school built by his grandfather. He landed a job on General Motors' assembly line, and won a place studying engineering and industrial administration at the General Motors Institute. O'Neal later secured a Harvard scholarship, where he earned an MBA. "I really didn't have an understanding of the world or any role models, but I had a strong desire to learn, and I think that is what pulled me through," said O'Neal.

He left General Motors for Merrill Lynch in 1986, beginning a meteoric rise to CFO in 1998, president in 2000 and CEO in 2002. In July 2002, when Fortune magazine named O'Neal the most powerful black executive in the country, O'Neal refused to comment for the story. Most interviewers found ONeal disinclined to talk about his race and background, as Fortune later wrote: "[O'Neal] is even reluctant to discuss what it's like to be the first African American to run a major Wall Street firm."

Last year business pundits praised O'Neal, and his firm rewarded him for their record $7.5 billion net income by paying O'Neal $48 million, one of Wall Street's richest packages.

Back in 2002, when O'Neal was picked for ascension to CEO, Fortune published a fairly glowing, lengthy story on O'Neal titled, "Can Stan O'Neal Save Merrill?" mentioning his race only once. And a BusinessWeek story, "Merrill: Is Stan the Man?" never mentioned his race. Aside from noting that O'Neal was the first black CEO of a big investment firm, most stories at the time focused on O'Neal's accomplishments, his leadership style and the obstacles facing Merrill Lynch -- but did not focus on his race.

But O'Neal, as did many CEOs in financial services, placed bad bets in the mortgage market. The sub-prime meltdown resulted in a $7.9 billion write-off in mortgage-related assets for Merrill Lynch's third quarter. His rivals -- Citigroup Inc. and others -- also lost huge sums of money. After his five-year tenure -- average for an American CEO -- the board fired him.

As for the termination, only a handful of papers bothered to mention that O'Neal is black -- and usually deep into the story. A front-page Wall Street Journal article said, "Mr. O'Neal . . . is widely credited with boosting Merrill's profitability and transforming it . . . . " Then halfway through the story, it says, "No one on Wall Street embodied the Horatio Alger story better than Mr. O'Neal, who became the highest-ranking African-American on Wall Street." The New York Times story, "At Merrill, a Risk-Taker's Rise Ends With a Messy Undoing," makes no mention of race.

O'Neal's race played no role in either his hiring or firing. So Jesse Jackson and Al Sharpton will likely remain silent -- for a change.

As to the trainee at the rental car agency, I doubt whether she ever heard of O'Neal. But she certainly could benefit from something the former Merrill Lynch CEO once told Newsweek: "It's maybe the only country in the world that could have somebody like me start out where I did and wind up doing what I'm doing."