A long, catty piece in The New York Times this weekend (“Nice City You Got. I’ll Buy It.”) took jabs at Steve Schwarzman for his charitable giving, calling him “a man with more money than respect.”

The story got some basic facts wrong, however:

  1. Schwarzman was not “behind the putsch that drove [his and Pete Peterson’s] enemies from power” at Lehman Brothers in 1984. It was Peterson, an investment banker who had been chairman and co-CEO of Lehman, who was the victim of a putsch the year before, in 1983. The firm’s traders, led by Lou Glucksman, pushed out Peterson – the culmination of years of fighting between Lehman’s bankers and traders. In 1984, under Glucksman, the traders ran up big losses that threatened to sink the firm and cost its partners all their invested capital. Schwarzman played an unauthorized role in soliciting a bid for Lehman that, in effect, bailed out the firm, but there was no putsch in 1984.
    King of Capital recounts the infighting, which ultimately led to Peterson and Schwarzman forming Blackstone in 1985. Ken Auletta’s excellent Greed and Glory on Wall Street (1986) is devoted entirely to the war within Lehman.
  2. The article states, “Jimmy Lee, a friend of Mr. Schwarzman’s, has joked…” about Schwarzman’s gifts to Catholic charities, suggesting that Lee is still saying these things. Lee died in 2015.
  3. Schwarzman’s controversial reference to Hitler’s invasion of Poland in 2010 involved the proposed tax on carried interest (profits) reaped by private equity and hedge fund managers like himself, not a tax on corporations, as the story said.

Photo from New York Times story: