Michael Milken Play Coming to New York
An interesting-sounding play that will be debuting in New York’s Lincoln Center in November is “Junk” by Ayad Akhtar, the son of a couple of Pakistani doctors.
It’s a fictionalization of how junk bond kind Michael Milken changed America in the 1980s. From the Los Angeles Times in 2016 about the debut of “Junk” in La Jolla:
In “Junk: The Golden Age of Debt,” his thrilling new play, which is receiving its world premiere here at La Jolla Playhouse, Akhtar takes on the equally explosive subjects of modern finance and the new religion of money. …
Part Shakespearean history play, part “The Big Short,” “Junk” tells the story of how debt overtook value as the path to enormous wealth. Set in 1985 when U.S. manufacturing was in stark decline and junk-bond financing was the new amphetamine designed to inject vitality into the country’s economic bloodstream, the play focuses on a point of momentous transition in our financial system.
At the center of her investigation is Robert Merkin (Josh Cooke), whom Time magazine put on its cover with the headline: “America’s Alchemist. Debt Becomes an Asset.” Merkin is the brains of a Beverly Hills investment bank that has been deploying a strategy of hostile takeovers.
His junk-bond strategy is viewed as vulgar by WASP industrialists who can’t believe the new landscape in which Jewish financiers such as Merkin and his associate Israel Peterman (Matthew Rauch) can plunder venerable, if suddenly vulnerable, manufacturing firms that make a tangible contribution to the American economy. (These bluebloods, arrogant, self-entitled and unthinkingly bigoted, don’t appreciate outsiders encroaching on their aristocratic turf.)
Thomas Everson (Linus Roache), a country club swell who has been trying to keep Everson Steel and United together during a period of rising labor costs and increased competition from China, now faces a more pernicious threat from Merkin’s team, which has mobilized to conquer the business his family built.
Steven Pasquale will play Merkin/Milken in New York.
A lot of what Milken did was junk the idea that business leaders had unwritten obligations, such as to behave with prudent stewardship concerning the organizations under their care.
For example, around 1988 or 1989, the CEO of the small publicly traded firm where I worked showed me the plan that an investment bank (Lehman? Salomon? Morgan? I forget which — it wasn’t Milken’s Drexel, but it was clearly a copycat plan) had called him up to share with him. It involved our firm issuing a ton of junk bonds and using the money for the inside executives and the Wall Street firm to take the company private and then, if the insiders succeeded in paying off the bonds, they would own it outright without investing anything in it. And if they didn’t pay off the high-interest bonds, well, that’s what bankruptcy law was for.
I replied that we were barely making payroll some weeks as it were, so if we rolled the dice like that, we’d almost certainly go under, costing you, me, and most of the other 2,500 employees our jobs. And I personally like having a job. The CEO said he agreed and threw the junk bond proposal in the trash.
Milken would have scoffed that that is the kind of timid thinking that is ruining America.