In an Uncertain World

by Robert Rubin

  Years later, when I discussed this with Alan Greenspan, he told me that the assertion “All is uncertain” is inherently contradictory because it asserts that uncertainty itself is certain. I didn’t choose to debate the matter with Alan at the time, but one answer is that he was right—the basic assertion of uncertainty is unprovable. But that just leaves us back where we started—nothing is provably certain.

  Academically, my plan at Harvard was conventional. Most people who were headed for law school, as I loosely assumed I was, majored in government. I started doing that and then switched to economics. In those days, the focus in economics was largely conceptual, and I found it difficult but engrossing; later, when the field had become much more rigorously econometric, I would not have had adequate math to major in it.

  My senior honors-thesis tutor was Thomas Schelling, the economist famous for applying game theory to international relations and thereby explaining the doctrine of nuclear deterrence. Schelling had just come to Harvard from Yale, and I was his only tutee. I spent the summer between my junior and senior years in Cambridge with no job, sleeping on a broken couch in the living room of a shared apartment, and working on my thesis to get a head start. Researching and writing in the stacks of Widener Library every day were among the few projects I really enjoyed at Harvard. My paper was about the relationship between inflation and economic development in Brazil—a subject that attracted me in part because Latin America seemed a potentially fruitful area for entrepreneurial involvement. I found plenty of data and analysis from English-language sources to test various hypotheses about inflation. In 1995, when I met the Brazilian finance minister, Pedro Malan, he’d done his research. He said that his ministry had looked up my Harvard thesis and that my conclusions were largely on the mark.

  Socially, Harvard was made up of subcultures. I wasn’t really a part of any of them, but I liked to think of myself as someone who hung around coffeehouses—which in those days didn’t mean Starbucks but places with a bohemian atmosphere and not particularly good coffee. I didn’t actually go to coffeehouses very much, but occasionally I would stop by the Club Mount Auburn 47 or some other club, where people would sit around and some would-be Joan Baez would sing. I liked the sit-around-and-ponder-the-issues-of-life atmosphere.

  One of the intellectual movements swirling around in the coffeehouse culture of those days was existentialism, and I related to that in some way. But my version of existentialism didn’t have much to do with whatever I read of existential philosophy. Instead, I would describe it as an internalized sense of perspective. During my years at Harvard, I developed a feeling that, on the one hand, the here and now mattered a great deal, while on the other hand, in the totality of time and space, in some ultimate sense, that significance shrinks. How much will anything that happens today matter a hundred thousand years from now? Somehow, this internalized duality allowed me to maintain an intense involvement in whatever I was doing, while at the same time retaining a sense of perspective and a feeling that I could always opt for an entirely different kind of life.

  Not until senior year did I really develop some sense of belonging at Harvard. In reality, my anxiety proved to be unrealistic early on in my college career. But holding on to it, while detrimental in some ways, may have been useful in others. Worry, if it doesn’t undermine you, can be a powerful driver. After thinking I wasn’t going to cross the finish line, I graduated from Harvard in 1960 with the unexpected distinctions of Phi Beta Kappa and summa cum laude, as well as a summa minus on my senior thesis.

  After graduation, I sent a tongue-in-cheek letter to the dean of admissions at Princeton, to which I had not been accepted four years earlier. “I imagine you track the people you graduate,” I wrote. “I thought you might be interested to know what happened to one of the people you rejected. I just wanted to tell you that I graduated from Harvard summa cum laude and Phi Beta Kappa.” The dean wrote me back, “Thank you for your note. Every year, we at Princeton feel it is our duty to reject a certain number of highly qualified people so that Harvard can have some good students too.”

  DURING MY SENIOR YEAR, I had applied to Harvard Law School as well as to the Harvard Ph.D. program in economics. I was admitted to both but couldn’t decide which to do. In fact, I wasn’t at all sure I wanted to do either, at least just then. I went back up to Cambridge in the fall and spent three days at the law school, but I wasn’t ready to roll up my sleeves and cope with the stress of it after having just finished four intense years of college. Everyone else was buying books and looking serious, and that wasn’t for me. So I went to speak to the assistant dean of the law school and told him that I was going to leave.

  “You just started,” he said. “You can’t just drop out. You’ve taken a place somebody else could have had.”

  I told him that I was dropping out anyway.

  “If you drop out, I won’t readmit you unless there are some extenuating circumstances,” the dean said.

  We talked some more, and the dean said that if I’d go to see a psychiatrist and the psychiatrist said that I was making a reasonable decision, he would readmit me the following year.

  So I went to see the psychiatrist. He told me that when he had been about to begin medical school, he had taken a year off instead and traveled abroad. He said that I was fine—but that perhaps the dean ought to come see him if he found what I wanted to do so troubling.

  A few days before law school started, I had run into some college classmates who were on their way to England for a year. One was going to study at Oxford, which sounded appealing. I was too late to apply to Oxford or Cambridge, but I discovered that I might still get into the London School of Economics for that year. I applied by cable, emphasizing my Harvard credentials. The LSE cabled back, accepting me. Then I called my parents and said I had a surprise for them. I was dropping out of law school and going to London.

  The only impediment to my immediate departure was that I had to go home to Miami first to meet with a representative of my draft board. Graduate study provided a military service deferral, but the school had to be recognized. My interviewer at the draft board was a southern businessman of an earlier era.

  “Well, I don’t know anything about the London School of Economics,” he said. “The trouble with boys of your race is they don’t want to go to war.”

  “I have no objection to war,” I told him obsequiously. “I just want to study at the London School of Economics.”

  “How do I know this is a respectable institution?” he said.

  I offered to get him a letter. So the chairman of the Harvard Economics Department, Arthur Smithies, had to write a letter stating that the London School of Economics was a recognized academic institution.

  Before arriving in England, I had never been abroad, unless you count one family trip to Mexico and an elementary school excursion to Cuba. My year in Europe was enormously enlarging—and I’d recommend a postcollege year abroad to anyone who has the opportunity. Just before I left, I had a conversation with a worldy woman in Miami who was a friend of my parents. She told me that I should just open my pores and absorb everything I could. And that, in some reasonable measure, was my approach.

  Harvard was an American culture, albeit a cosmopolitan one with quite a few foreign students, especially in the graduate schools. The LSE, on the other hand, was a truly international culture, with students from all over, especially from Commonwealth, former Commonwealth, and soon-to-be former Commonwealth countries. I met Indians, Africans, Australians, and West Indians. The political spectrum these students represented was much wider than what I’d encountered previously. Many described themselves as socialists, reflecting the broad-based support socialism had in both the developed and developing worlds at that time. I thought then, as I do now, that the concept of state direction of economic activity and state ownership of economic resources was likely to be highly inefficient. But debates around those issues also helped form my own interest in the problems of poverty and inc
ome distribution.

  Meeting people with experiences and opinions so different from what I’d been exposed to was mind-opening. Issues that people at Harvard took to be about standards of living and economics, my Third World friends took to be about dignity and respect as well. For instance, people from the developing world wanted their own steel mills and airlines in order to show that they were just as good as the English and Americans, despite arguments that this was an economically inefficient allocation of resources for low-wage countries. Such arguments were a lesson in how fundamentally different an issue can appear from different perspectives. But the more important lesson, which would strengthen for me as time went on, was the overwhelming importance of recognizing and respecting the dignity of the individual. That respect is a fundamental value in itself. And sensitivity to the basic psychological need for such recognition is also essential to dealing effectively with all sorts of management and policy problems, whether in running a Wall Street trading room or in constructing and implementing international economic policy.

  I was enrolled in the LSE as what was delightfully known as an “occasional student.” Working toward a certificate rather than a real degree, I had no real responsibilities at the university. I would go to lectures and write papers for a tutor, but I spent most of my time just talking to people. The sense of freedom was marvelous. In my lodgings on Earl’s Court Road, I could make dinner at midnight, sleep late, and then wake up and read all day if I felt like it. Or I could go to a lecture that looked interesting and then meet a friend and play squash. I worked on my French, carrying a little vocabulary booklet with me on the Underground. I was also a bit of a political tourist, going for instance to a rally in Trafalgar Square for a protest of the assassination of Patrice Lumumba, who’d been elected Prime Minister of the Republic of Congo. I didn’t join in the protest, just watched with interest.

  I also got to know an international crowd of people my age who lived in the neighborhood around Earl’s Court Road. There were some faux aristocrats and a few real ones from places like Malta and Poland. With my LSE friends, I sat around and talked about politics, economic systems, and the meaning of life. With the Earl’s Court crowd I went to parties, and once boating on the Thames. I went to Austria as part of an inter-university ski trip with students from Oxford, Cambridge, and Trinity College Dublin—the first and last time I skied. At the same time, I also continued to explore—in my own limited way—the strain within me that identified with the beat generation and its expatriate predecessors of the 1920s and ’30s in Paris. I read a bit of Jack Kerouac and a lot of Henry Miller, which seemed especially fitting in Paris over the six-week-long Christmas vacation. I checked into a cheap hotel on the Left Bank, where some people I knew from Harvard were staying. During the day, I’d go to cafés and sit around talking or reading.

  I’ve always thought—probably quite incorrectly—that if my life had taken a different turn, I could have lived the kind of life that those weeks in Paris, or the pre-1960s coffeehouse culture of Cambridge, represented. As the years went by, even as I became part of the establishment, I continued to feel that I could always opt out of the system if I wanted to. I could just say good-bye, put on a pair of frayed khakis, and check into a little hotel in St.-Germain-des-Prés. People who have never seen me without a pinstripe suit may find this somewhat incongruous, but I felt then, and feel even now, that I could comfortably opt for a more relaxed, unstructured existence. That feeling may not be realistic, but my belief in this possibility has been a mental escape hatch in times of pressure. At stressful times in my career, I’ve returned to that idea of sitting around in cafés, reading, and having long discussions about philosophy and life. Sometimes even now I think I could just spend my life fishing, reading, and playing tennis.

  Over Easter I went to Italy, and in the summer I drove around Norway, Denmark, and Sweden with a friend named David Scott. I was considering the possibility of staying in Europe for another year when I read a passage by a onetime expatriate, who wrote something to the effect that “if you’re abroad too long, you start to rot.” That, combined with the possibility that my parents wouldn’t be too keen to underwrite another year of undirected foreign activity, made me think it might be time to come home. I said good-bye to Europe when David’s red Austin Healey was stolen in Frankfurt while we were having lunch.

  Part of the reason I had such a good time living abroad was that I wasn’t particularly worried about the future. In the back of my mind, I knew I would probably go to law school, either at Harvard or at Yale, where I had also applied and been accepted. I didn’t necessarily want to be a lawyer, but law school seemed to keep a lot of options open. Thanks to that psychiatrist, Harvard had readmitted me. But I ended up enrolling at Yale, which seemed broader and more interesting, and also less intense. My idea, which was somewhat of an exaggeration, was that at Harvard Law School you sit around and discuss contracts and at Yale you sit around and discuss the meaning of good and evil.

  IN FACT, my experience at Yale Law School, where I enrolled in the fall of 1961, did have some of that quality. In addition to classes and the library, I spent a lot of time discussing issues ranging from the Vietnam War to the nature of the good life. In law school, I had more than ample opportunity to apply the view I had developed at Harvard that all propositions were, when driven back to their core, unprovable. You can have strong moral beliefs developed through your upbringing or education, or through intense religious faith, but none of them are provable.

  You can never tell who may come along in life to influence you. Early in my first year, I ran into a third-year student, George Lefcoe, whom I had met briefly when we both lived in Miami. He stopped his bicycle on the street during orientation week to offer me a bit of upperclassman’s advice. George said that doing well in law school was important because it brought recognition, and recognition brought happiness.

  I thought that understanding of human nature had the disadvantage of being wrong. “You’re telling me that doing well and getting recognition makes you feel good,” I responded. “But my experience is that it doesn’t work that way.” I told George that I had graduated from Harvard with strong credentials, which had brought one kind of satisfaction, but not the feeling of wholeness or fulfillment he was describing.

  Years later, I would still be making the same point in job interviews at Goldman Sachs. When I’d ask interviewees why they wanted to work for us, the more honest ones would admit that at least part of the reason was to make money. I cautioned that they would find that making a lot of money might satisfy them in some ways but wouldn’t fulfill whatever had driven them to want that money in the first place. Few of them paid any attention. But years later, some of them came to me after doing very well financially to complain of being bored or unsatisfied with their lives.

  Every place I’ve worked—Goldman Sachs, the White House, Treasury, and now Citigroup—I’ve seen people who seem to be seeking the Promised Land of satisfaction through some kind of position or accomplishment. Most often, what I was trying to say to George Lefcoe all those years ago still seems to me to have held true. The only place people find fulfillment is within themselves. And too often, that’s the last place they look.

  That argument with George was the beginning of a yearlong dialogue. We spent endless hours walking the streets of New Haven, talking about law, philosophy, and life. George had a much more developed philosophy than I did at that age, and he loved to be cynical and provocative. Another participant in some of these conversations was Leon Brittan, a graduate of Cambridge University who was studying at Yale on a fellowship. After returning home, Leon went on to become a prominent Tory politician. The three of us once took an especially long walk in New Haven, with George arguing that reading fiction was a waste of time because whatever was gained could be learned more efficiently from nonfiction. Leon responded that fiction can often capture reality better than nonfiction. The argument became heated, and although my view was closer to Leon�
��s, I tried to keep the peace.

  George sympathized with an approach to legal analysis called legal realism, which was very influential in shaping the ethos of Yale at that time. Legal realism held that the language of statutes or prior decisions didn’t dictate outcomes because it could be interpreted in different ways. Judges’ decisions were a product of policy views, beliefs, biases, and all sorts of subjective influences—the famous formulation being that decisions were dictated by what the judge had eaten for breakfast that morning. With this approach, you’d consider the statute, the facts of the case, and a judicial decision. When you asked whether the language of the statute had dictated the decision the judge had made, the answer would almost always be no. The words of the statute could fit two or more different conclusions. Legal realism was another way of challenging certainties and reexamining assumptions, and the atmosphere at Yale furthered my own intellectual development along these lines.

  At Yale, I made a group of lasting friends who also enjoyed lengthy discussions of the issues of the world. Leon Brittan, for example, had a much more nuanced view of the earliest stages of the Vietnam War than anyone else I knew. He believed that the United States should stand up to communism but was afraid that our involvement would be so divisive as to create serious social disruptions at home, and that the negatives of American involvement might outweigh the positives. That was a remarkably astute analysis, especially in 1962.