What’s wrong with Wall Street? A culture that breeds greed
Editor’s Note: Before Sam Polk was a social entrepreneur passionate about nutrition and poverty, he made millions on Wall Street as a hedge fund trader. In his last year on Wall Street, Polk took home a $3.4 million bonus — and was devastated it wasn’t more. That moment would be a clarifying one, and Polk soon walked away from Wall Street and its seductive wealth.
Economics correspondent Paul Solman sat down with Polk to discuss Wall Street culture, obsession with money and Polk’s personal journey. For more on the topic, watch last week’s Making Sen$e report and read an excerpt from Polk’s memoir, “For the Love of Money.” The following excerpt has been edited for clarity and length.
— Kristen Doerer, Making Sen$e Editor
PAUL SOLMAN: What’s wrong with Wall Street?
SAM POLK: So when I was on Wall Street, my entire life’s goal was to make more money than the next guy. And that’s effectively the culture of Wall Street. And it’s not that Wall Street is a bunch of criminals – I think people actually do caricature and judge Wall Street too harshly. But what is the problem is that Wall Street has a culture that is entirely focused on what’s good for itself, and I think in our country, we’ve sort of lost the ability to care about the system as a whole and all the people who are in it and understand how our actions impact other people. In short, that’s what’s wrong with Wall Street.
PAUL SOLMAN: So they’re caught up in a system and they don’t realize what’s happening to them?
SAM POLK: People like Bernie Sanders and others on the far left are happy to call Wall Street criminals, but a lot of the people that I know on Wall Street are wonderful people. My mentors on Wall Street are some of my best friends. It’s not that they’re evil.
But folks on Wall Street are part of a system that has created some of the greatest inequality the world has ever seen and they continue to perpetuate that. And that’s the reason that I left Wall Street — it’s not because there was rife criminality and not because Wall Street is full of bad people. I just became aware of where I stood in the system and became aware that I did not want to do that anymore.
PAUL SOLMAN: In your book, you relate this to your personal background.
SAM POLK: Since I was a little kid, my biggest goal was to become rich and successful. And a lot of that came from my dad. My dad was this sort of Willy Loman character, this sort of out of work salesman that could never make ends meet, but had these huge dreams of one day making it big. And my family in particular had a lot of stress. There was a lot of anger and stress between my parents, and so from a really young age, I grew up believing that when I became rich, when I became successful, all of those problems were going to be erased.
I remember, when I was 27, I had been on Wall Street for five or six years, and I was at this club in Las Vegas, and it was this super-exclusive club, and there were $1,000 bottles of champagne and beautiful women all around. And I remember having this experience of looking around and seeing that my life finally looked like I had always wanted it to look. But I felt empty.
And I sort of laugh telling that story because that is not a unique story. If you read any Wall Street memoir or any sort of rich guy who’s come to “Jesus moment,” they always have this “I feel empty” moment. But for me that was the beginning. Since I was a young kid, I believed that being rich was going to fix me, and when I got to that level and it didn’t, I really began investigating where that belief system came from, within myself but in our culture as a whole.
PAUL SOLMAN: And so what did you?
SAM POLK: I had worked so hard and for so long to get to that position that the idea that what I had worked so long and hard for wasn’t the answer was a really tough pill to swallow, and it took me years of questioning and vacillating about what I was going to do.
I get letters every week from people on Wall Street who are happy with the amount of money in their lives, but feel like something is missing. And the truth is that even though there’s a lot of people that feel like that, they don’t leave. But it’s really hard because we live in a culture that says success equals money and success equals what it says on your business card.
I was working for one of the largest hedge funds in the world, and I was a senior trader on Wall Street, and people treated me with a tremendous amount of respect. That’s the scary thing about leaving Wall Street: You’re leaving behind all the things that you’ve used to make yourself feel valuable. And that’s what it was for me. For a long time, I would use the company that I worked for, what it said on my business card or what my bonus was that year as a sign of my own worth.
PAUL SOLMAN: So you come to, as you put it, this Jesus moment when you were 27 at this fancy night club in Las Vegas. How long does it take you to get out?
SAM POLK: It took me about three years from that moment and it took a second moment to make me get out. When I was a senior trader at one of the largest hedge funds in the world, I was at a meeting with one of my billionaire bosses and several other traders. This was during 2009, in the midst of the crash, and we were all discussing the hedge fund regulations that were being imposed by Congress. And everybody in the room thought they were a terrible idea. But I’d started to think that maybe they made sense. So I said, “Isn’t it better for the system as a whole?”
And it was this sort of terrible moment where the room went entirely silent, and my billionaire boss shot me this withering look, and he said, “You know what, Sam? I don’t have the brain capacity to think about the system as a whole. I can only think about what’s good for us in our business.”
And it wasn’t that I judged him in that moment; it was that I saw myself in him and that I came to understand that my whole life had been about collecting for myself and what was good for me. This was in the midst of the financial system crashing and people’s houses being foreclosed on and mass job losses. And I was part of a culture that was focused on what was really good for us, even though to a large extent we’d been at least partially responsible for this crisis. Being on Wall Street means that you’re close to these huge piles of capital that have been accumulating for years. And so, almost by definition, we were benefiting from the increase in inequality in the world.
PAUL SOLMAN: Were people stunned when you walked away?
SAM POLK: Yeah. I don’t know a lot of people — except my co-founder, David — who leave these really lucrative careers. I think that Wall Street is full of people who have been successful their whole lives and who are just trying to be even more successful.
Ninety-nine percent of people on Wall Street wake up in the morning, kiss their kids goodbye, go to work, do nothing illegal, come home and go to bed and do it again. For me, it’s not about overt criminality on Wall Street, although I’m sure that some of that exists. It’s about not being conscious of how your behavior impacts the rest of the world and where you fit in the system. I came to believe that the system itself was something that I wanted to change, as opposed to benefit from.
PAUL SOLMAN: Why do you suppose you had that insight when so many people very much like you don’t or at least don’t act on it?
SAM POLK: The year that I started on Wall Street, I got dumped by this girl and it was the sort of last in a string of pretty devastating events in my life. But for whatever reason, that one was the one that caused me to say, “You know what? Things aren’t working. There’s clearly something wrong in how I’m handling my life, and I want to change.”
So I started seeing this Native American spiritual counselor named Linda. So if you can imagine, for my entire career on Wall Street, I was going to work in the morning, trying to climb this corporate ladder. But at night, I was coming home and talking to this Native American spiritual counselor who was talking about things that were totally different from the sort of value system that I had grown up with. She was talking about what’s good for the community as a whole and making sure that other people are taken care of before yourself. Native American philosophy has this communal belief system where every person is equally valuable, and somehow our Western world came in with this deeply hierarchical system where some people are winners and some people are just thrown away. And her teachings were all about not only how damaging that can be to a person and to the people at the bottom, but about how important every single life actually is.
PAUL SOLMAN: You’ve mentioned wealth addiction before. Can you talk some more about that?
SAM POLK: I wrote this New York Times op-ed that talked about the idea of wealth addiction. People think that it was a personal diagnosis, but it was really a cultural metaphor. An addiction is when you are so consumed with this need inside that you are trying to fill it up and you have no sense of proportion or how that impacts people around you. The difference between this idea of wealth addiction is that all the other addictions have negative repercussions. So you drink too much, you get a DUI. Too many drugs, your wife leaves you. But wealth addiction is celebrated in our culture and so there’s no negative consequences for us. There are plenty of negative consequences for people that live on the margins and people that don’t get to participate in this money game chase that the rest of us are playing. And that’s one of the reasons I left Wall Street is that I came to understand that we could do a better job of making a more inclusive society.
PAUL SOLMAN: And you wrote another op-ed for the New York Times on sexism on Wall Street.
Most women experience horrific sexism while they’re on Wall Street, whether it’s their bosses trying to sleep with them, casual conversations where women are degraded, the gender wage gap, or it’s the guys going to a strip club and the women don’t know what to do. And there are all these other ways that women experience this overt sexism. The point that I was making in my New York Times op-ed is the vast amount of sexism occurs when women aren’t in the room, in casual conversations between guys where we talk about a woman’s body or talk about who we would rank higher, or who we would like to do certain things to in bed. And guys do it sort of unthinkingly as if just because you and me are talking and no woman hears it, it’s OK.
That creates a culture of disrespect and degradation towards women, and you can understand pretty easily how it works. If you and me are talking about really tearing a woman apart in private, then how is it that we’re going to end up then paying that woman a higher amount of money or, God forbid, working for her. I believe that it’s these casual conversations between men that are part of what makes Wall Street such a hostile environment for women, where women are not only underpaid, but severely under represented at the highest points.