Genius in Disguise Read online

  Still, this was their “understanding,” and to his credit, even when Fleischmann came to appreciate just how extraordinary was the freedom that Ross had demanded and got, he very seldom attempted to traduce it. The minor qualification is necessary because inevitably there were exceptions. In the late Twenties, for instance, he coerced Ross into accepting one of his close friends, Arthur Samuels, as the magazine’s Jesus. Ross couldn’t abide Samuels, especially after he filled his office with pricey rugs and other lavish furnishings, in stark contrast to the editor’s own spartan, linoleum-lined accommodations. Ross fired him by telegram just as he was returning from a long European vacation. After Samuels bawled him out for this cheap gesture, Ross sheepishly admitted to a friend, “I did a thing no decent man would have done.”

  Then there were invariable fights about editorial material bound to offend squeamish advertisers. Fleischmann was particularly acrimonious on the occasion in 1934 when Ross ran a casual spoofing a series of Camel ads, wherein attractive housewives testified to the calming property of the cigarettes (Says Mrs. Phyllis L. Potter, Montclair, New Jersey: “I can smoke Camels freely without a hint of jumpy nerves!”). As if the piece wouldn’t invite enough trouble on its own, due to an oversight it was printed right next to one of the ads it was lampooning.

  In the main, however, Fleischmann showed stunning self-restraint with the editorial side, considering that essentially he owned The New Yorker. He read and enjoyed the magazine like everyone else—after it came off the press. He didn’t ask to see stories ahead of time, and he reserved his opinions afterward so as not to sway the editorial department, either consciously or unconsciously, with his likes and dislikes. He even honored, at times to his irritation, the physical segregation. In 1943, when Edmund Wilson joined the staff of The New Yorker as the chief book reviewer, he had heard about this famous division of business from editorial, but being familiar with publishing he had his doubts. Then Fleischmann invited him to lunch and arranged to meet him in the building’s lobby. “I was sorry not to come to your office,” the publisher explained, “but you know the situation here.” As Wilson would subsequently observe, “It was a little like a Russian grand duke in exile.”

  This, then, was the backdrop, largely Ross-imposed, to the three-decade relationship between New Yorker editor and publisher: Go about your business, and leave me to go about mine. It was truly a liberating philosophy for a magazine, and it made for a vigorous, uninhibited product. On the other hand this segregation, with its inherent suspicions and implicit distrust, tended to undermine any fragile bond that might once have existed between Ross and Fleischmann.

  As mentioned previously, Ross’s resentment of Fleischmann really began at the beginning, in 1925, when the latter sought to repair the damage from Ross’s poker debacle, and the editor’s guilt only swelled as Fleischmann’s bank account drained. Their relationship was exacerbated by the appearance of John Hanrahan, just as future issues would exacerbate it: the allocation of dividends, staff pay, the direction of the company’s board, and, ultimately, the extent to which Fleischmann had profited, and Ross had not, from The New Yorker’s phenomenal success. Over the years, as in most personal feuds, Ross’s antagonism took on a life of its own, out of all proportion to its ostensible causes. Within a few years of the magazine’s start, intermediaries were required to conduct any serious business between Ross and Fleischmann. Their mutual friend Hawley Truax, a businessman-scholar (and a man who never spent a dollar when a dime would do), performed this delicate task informally until 1942, when he joined the magazine’s employ and gave over his career to keeping the peace at The New Yorker.

  Personalities aside, Fleischmann’s biggest problem, plain and simple, was that he was the embodiment of the magazine’s business side. Ross’s disdain was evident in the smallest details: he labeled a folder that bulged with ongoing problems and disputes, largely with the business side, his “Hell File.” He forever complained that the magazine’s sales effort was token (the salesmen themselves were “ad-takers” or “plugs”), its circulation strategy misguided, its promotional materials insipid and wasteful. For twenty-six years he argued that there was a better way to advance the cause of The New Yorker: simply put the money into editorial. Ross firmly believed the magazine sold itself; no doubt it did to a point, but Fleischmann was enough of a businessman to know that even free ice cream doesn’t sell itself. Still, for the most part he suffered in silence, considering Ross’s invective the price to be paid for his golden editorial touch. “Harold just had a great distaste for business people, or anybody who was not creative,” Fleischmann explained. “For creative people he had the greatest respect, but the business office was made up of people who did ‘chores’ (which was one of his favorite words involving our labors) and we were beneath contempt.”

  ——

  In truth, the seeds of deepest discord between the two men were planted in 1929, and at first they had nothing whatever to do with Raoul Fleischmann.

  When Ross and Jane Grant were working out the details of their divorce, the independent Jane was uninterested in conventional alimony; besides, Ross was practically broke. On the other hand, she was concerned for her long-term security, especially given her parlous health, and she was intent on deriving some dividend from her hard work and personal sacrifice in behalf of The New Yorker. After some negotiation, then, the divorcing couple came up with a creative and, at the time, a win-win solution. Ross put four hundred and fifty shares of his charter F-R Publishing Corporation stock into a trust for Jane. She would receive all dividends from the stock up to ten thousand dollars a year. In the event that the dividends fell short of ten thousand dollars, Ross would pay the difference. (To further protect her, he took out a fifty-thousand-dollar life insurance policy on himself, with Jane the beneficiary.)

  This arrangement caused Ross no real hardship for the first few years, as the magazine repaid most of its robust earnings to shareholders. With the deepening of the Depression, however, Fleischmann made an important decision that inadvertently would cost Ross dearly. The publisher decided it would be prudent for The New Yorker to build up over several years a large cash reserve, a kind of corporate rainy-day fund. To accomplish this, of course, the company had to cut back its dividend, so suddenly Ross found himself writing Jane big checks every quarter. The “Jane Grant agreement,” as it was known to one and all within the New Yorker hierarchy—for it was something virtually everyone had to deal with, in one way or another—became an unending nightmare for the editor, looming over every financial decision he made for almost twenty years.

  As with so many aspects of his character, Ross was wildly contradictory where money was concerned. On the one hand, he had a sophisticated grasp of finance and meticulously tracked the performances of dozens of stocks and bonds in his portfolio. On the other, he could be so cavalier as to walk around Manhattan with blank checks peeking out from his coat pockets, or sign over his power of attorney to a secretary and promptly forget about it for years. He used to say, “I only want enough money to live on,” by which he actually meant enough to live comfortably on: to be able to afford a nice home and car, domestic help, good Broadway tickets; to have the wherewithal to play poker all night or take off for Colorado or California without worrying how to pay for it. Beyond this, money was basically a nuisance, something that required him to spend his precious time with lawyers and accountants instead of writers and editors. To him, money was more significant in terms of what it represented, and where Fleischmann was concerned, increasingly it came to represent inequity, certainly, and even perhaps iniquity. The way Ross saw it, he was working sixty-hour weeks to ensure the excellence of The New Yorker, but for all his trouble he was struggling to stay afloat financially, while Fleischmann and his associates (or as the editor put it, his “stooges,” his “ring of stupid fumblers”) pulled in much more of the proceeds.

  Still, by itself Ross’s running debt to Jane Grant was not at first a crippling burden, even allow
ing for a Park Avenue address, the travel, the dinners at “21,” and the sometimes extravagant gambling debts. In the early Thirties he was generally earning more than thirty thousand dollars a year in total compensation (salary and bonuses), and he still held several thousand shares of increasingly valuable F-R stock. When the “Jane Grant agreement” was piled atop his many other financial obligations, however, it all became too much. For years he had been providing for his widowed mother. No sooner did she pass away than he remarried and acquired another big apartment to furnish. No sooner had he married than the happy couple was expecting. Most ominously, the Internal Revenue Service had its hooks into him for several thousand dollars (which he disputed) in back taxes over his New Yorker stock, the opening skirmish in what would be a deleterious twenty-year war with the tax man. Partly because of his tax woes, Ross, who always before had harangued employees who fled the city for the bucolic ‘burbs, was even contemplating a move to Connecticut, which had no state income tax. Yet a house would mean still another financial burden.

  The upshot was that by the summer of 1934, Ross was strapped for cash. He turned to his only real asset, his stock. A part of him was reluctant to sell, because of the exigent circumstances and because he was convinced the stock’s value would keep rising. On the other hand, he had been thinking about divesting for some time anyway because he had a nagging sense that somehow, even subconsciously, his editorial judgments were subject to compromise if he had to worry about their potential impact on The New Yorker’s bottom line. That would be an intolerable encumbrance. He had given the same reason for quitting the company’s board of directors shortly after The New Yorker started. He wanted to be free to do what he pleased, including criticizing the company’s business practices. It scarcely needs saying that he exercised this freedom liberally.

  Since Ross regarded Fleischmann as the chief source of his predicament, he wielded the stock sale like a club. That August—ironically, at the very time he was sweeping up behind the nettle-some Fortune story—he sold the bulk of his stock to Time Inc.

  Ross knew that Fleischmann would have bought back his stock in an instant, especially if the alternative was seeing it go to a rival publisher, and particularly if that publisher was Henry Luce. But Fleischmann, vacationing in Europe at the time, didn’t have the chance because Ross didn’t tell him. According to Ralph Ingersoll, who quietly helped swing the deal, the whole affair was coming on the heels of some recent indignity or other, with the editor ranting about not wanting to own stock in “Fleischmann’s company” and taking pains to make sure the transaction was kept secret.

  Ross started the process by asking a Wall Street friend, Philip Boyer, to shop the stock discreetly. Boyer, in turn, approached the well-connected Ingersoll for the names of prospective buyers. Ingersoll apprised Time’s corporate officers, suggesting that a happy opportunity had just presented itself. With that, the treasurer of Time, Charles Stillman, arranged to have lunch with Ross and talk things over; before dessert he had agreed to purchase 2,190 shares for $104,000, or $47.50 a share. (The stock split two months later.) Out of curiosity, Stillman asked Ross why he wanted to part with the stock. The editor reiterated his vague discomfort with having a financial stake in his own magazine, but later Stillman said he did not find this overly convincing.

  Time bought Ross’s stock not with any mischief in mind but because it regarded The New Yorker as a sound investment. Luce, in fact, was not even involved in the transaction. Nonetheless, before long word was racing around The New Yorker offices that the dreaded Luce had acquired a big chunk of their stock (the identity of the turncoat was as yet a mystery, though not for long). Takeover rumors flew. Juicier still was the speculation that Luce intended to make a wedding present of The New Yorker to his fiancée, the glamorous Clare Boothe, then managing editor of Vanity Fair.

  Not only did the dire predictions fail to materialize, but the following year Ross had Boyer approach Time again about the possibility of buying up the rest of his F-R holdings. By this point Time was on the verge of adopting a policy against investing in other publications, so Stillman passed and Ross sold the stock elsewhere. In 1936, Time sold its F-R stock at a handsome profit. Eventually Fleischmann was able to reacquire the rogue stock, still irate at having lost it in the first place.

  Again Ross told Boyer (as he would later tell many of his colleagues, including Thurber, St. Clair McKelway, and Ik Shuman) that he wanted to divest in order to safeguard his editorial independence. Though his financial dilemma was a factor, there is no question that Ross’s ethical impulses were genuine, as they were completely consistent with his lifelong management views and conduct. By the early Forties the founder of The New Yorker held just eighty-six shares, out of a total of eighty-five thousand outstanding, in his own company, and by 1948 he held none at all. Ross’s divestiture may or may not have been unprecedented for an editor-entrepreneur, but it bespoke a remarkable professional ethic at a time when the prevailing scruple was perhaps better typified by Frank Crowninshield, who was known to buy a painting he liked, then publicize the artist in Vanity Fair to drive up the value of his investment.

  Yet it must be said that Ross had one other important motivation for selling his stock in 1934 and 1935: fear. For Fleischmann had just committed New Yorker money to an enterprise that Ross was convinced would come to a bad end, and to his everlasting dismay he was right. As Ross told Katharine White long after the fact, “I got onto the Stage thing enough to know that it was a near-disaster and sold most of my stock then, thank God, or my ruin would have been complete.”

  The “Stage thing” was Fleischmann’s sub rosa decision to underwrite a magazine that turned out to be, in essence, a direct competitor to The New Yorker. When Stage finally blew up and Ross learned the full extent of The New Yorker’s support, “his resentment was almost boundless,” Fleischmann admitted. This was the breach, he said, that “was never healed.”

  To understand how Fleischmann got himself into such a bizarre predicament, it must be remembered that in the Thirties he not only was infatuated with publishing but had won big on his first try. The gambler in him was tempted to roll again. At the same time, the businessman in him believed a little diversification might be wise; The New Yorker was going fine, yes, but how long could an upscale magazine expect to prosper in a depression economy? So he was open to reasonable-sounding propositions. Before there was a Newsweek, for instance, James M. Cain seriously interested Fleischmann in starting up a competitor to Time. Cain wanted Mencken to edit it; when Mencken flatly refused, that was that. In 1935, F-R bought a stake in Condé Nast, which not only published Vanity Fair and Vogue but operated printing plants that produced, among other magazines, The New Yorker. At about this same time, his old friend and consultant John Hanrahan asked Fleischmann to help underwrite a new publication, Stage, and Fleischmann agreed.

  A big, glossy book, Stage at first meant to focus almost exclusively on theater, which is probably why Fleischmann didn’t think it would compete directly with The New Yorker. But to Ross it was clear from the start that Hanrahan was aiming for the same readers (and perhaps more important, the same advertisers) as The New Yorker. He also had no confidence in Hanrahan and believed that focusing on such a narrow subject as theater, especially in a bad economy, doomed Stage from the start. Indeed, it didn’t take Hanrahan long to recast the struggling publication more broadly as the magazine for “after-dark” entertainment, and to make it even more imitative of The New Yorker. Hanrahan wasn’t subtle in his copycat intentions: Stage employed drawn covers, tried (and failed) to achieve a similar sense of offhand elegance, and ran a knockoff of The New Yorker’s Goings On calendar. Most galling of all to Ross, Stage was paying better money to New Yorker contributors for lesser work, and he was in effect subsidizing it.

  Ross was apoplectic over the situation. He despised everything about Stage. He hated Hanrahan, hated the fact that free ads for Stage regularly ran in The New Yorker, hated that his contributors were bein
g diverted as if to a bawdy house. Stage was a “preposterous enterprise,” Ross told Fleischmann. “I could understand your spending money to put it out of business; I cannot understand your spending one cent to support it.” Nonetheless, the publisher stuck with Hanrahan as stubbornly as he had stuck with Ross ten years before. The only difference was that this time the money was not really his own to spend, but The New Yorker’s.

  Fleischmann was able to do as he pleased since his board of directors was largely filled with friends, Hanrahan among them, and was most perfunctory. For several years Ross was largely kept in the dark about the extent of The New Yorker’s subsidization of Stage. This was not unusual; he was always complaining about a lack of financial information, though the situation was largely his own doing because he tended to scold business-side denizens who interrupted him with their tiny problems. Still, he surmised that the total outlay was into the high six figures, and climbing. Then in April 1938, when he saw annual report figures and became alarmed over what a drag Stage was becoming on his magazine, he prevailed on Fleischmann for a complete accounting. A day or two later Fleischmann complied, and Ross got the whole unpleasant picture: Hanrahan was into The New Yorker for nearly a million dollars, and Ross’s own magazine actually owned thirty-six percent of Stage. The loans supposedly were secured by Hanrahan’s shares in The New Yorker, but his equity was nowhere close to covering The New Yorker’s investment.