News

HBS Grad Elected NYC Mayor

Harvard Business School graduates now hold the two toughest jobs in the country.

Michael Bloomberg, HBS 1966, the billionaire founder of the financial news and information network that bears his name, was elected Mayor of New York City last Tuesday, and will take on the immense task of rebuilding the city’s economy and psyche in the wake of the September 11 terrorist attacks.

The challenges facing Bloomberg are seen by many as second only to those facing President and fellow alum George W. Bush, HBS 1975, who continues to lead the nation’s response to the attacks.

Bloomberg, 59, is believed to have spent more than $50 million of his own money on the campaign, making it the most expensive mayoral election in U.S. history, nonetheless overcame long odds to be elected, running as a Republican in a city where registered Democrats outnumber members of the GOP by a five to one margin.

He was boosted by a strong endorsement from the city’s outgoing Mayor, Rudolph Giuliani—a Republican whose popularity soared in response to his strong leadership following the attacks that destroyed the World Trade Center—as well as squabbling within the Democratic Party following a bitter primary campaign last month.

Bloomberg drew 719,819 votes, compared with city Public Advocate Mark Green’s 676,560. Giuliani was prevented from running for re-election by the city’s term limits law.

‘A Leader, Not a Politician’

Bloomberg’s campaign commercials focused on his record in business, contending that the skills he demonstrated in building Bloomberg, L.P. would be crucial for the mayoralty—specifically convincing businesses like his to stay in the city.

Several of Bloomberg’s Section F classmates contacted last week remembered Bloomberg as aggressive, bright, and blunt and remembered his “out-of-the-box” ideas, even after 35 years.

One example remembered by several classmates came in their marketing class, when the section was discussing distribution problems facing a carpet manufacturer. While the section debated truck and rail shipping options, Bloomberg constantly tried to get into the conversation, but the professor would not recognize him.

Finally, after almost everyone else in the class had spoken, the professor recognized Bloomberg, who blurted out, “You air-drop them!” Other classmates recall rolling their eyes at the outrageous suggestion—until the professor responded, “exactly!”

Jan Hyde, a classmate who was a member of Bloomberg’s study group and is now a constituent, remembered that during the second-year interviewing period, Bloomberg told classmates that he intended to “go wherever they pay me the most.”

However, he didn’t follow through on that plan—ultimately choosing instead to join Salomon Brothers, even though the trading house did not actively recruit MBAs. Hyde said that was a good choice, describing Salomon as a total meritocracy, which enabled Bloomberg to advance quickly through hard work.

“He wanted to work at Solly, and he had a big argument over money with John Gutfreund, who was hiring him at that time,” said James Blume, another study group member who shared a summer house in the Hamptons with Bloomberg for several years after HBS.

“He ultimately went there for only $8,500, which was low at that point,” Blume remembered, noting that other Wall Street firms were paying HBS graduates between $9,000 and $10,000, while management consultants earned starting salaries of $14,000.

Bloomberg was credited with several innovations during his rise to partner at Salomon, but he was also known for rubbing some of his fellow partners the wrong way, which led to them buying him out for $10 million when the firm was sold in the early 1980s. Bloomberg used the money to launch his information services company, which has grown explosively since then.

“Mike saw a need that others were not filling, and had the ability to complement his vision. Then he was relentless in constantly improving the product,” said classmate Jud Reis.

Ties to HBS

Professor Jay Light described Bloomberg as a “good and loyal” alumnus, who has been a regular visitor to Allston over the years, both for reunions, and to deliver a keynote address to an executive education program several years ago. In addition, there have been HBS cases written about his company.

In the higher-education community, Bloomberg, who grew up in Medford, Mass., is better-known for his ties to his undergraduate alma mater, Johns Hopkins University in Baltimore, which he served as the chairman of its board of trustees.

Despite that involvement, Bloomberg’s latest move into public service surprised many of his classmates. However, they voiced little doubt that he would bring a fresh attitude to the city’s government.

“We need to rethink how government works and delivers its services. I think a successful person from outside the political system has a better chance of doing that well than a person who has grown up in the system and is comfortable with the system,” Reis said.

Blume agreed that Bloomberg is likely to bring a practical approach to government. “He’s basically saying, I’m going to make things work better.”

The policy positions outlined on Bloomberg’s campaign web site show an expansive vision, with him promising more involvement in everything from the city’s schools to its transit system. However, it remains to be seen whether Bloomberg will be able to fund all of those programs. The city’s tax revenues—already weak before the attacks—have plunged since, ushering in a new climate of fiscal austerity at City Hall.

But Brooklyn, N.Y.-resident Hyde said he is looking forward to seeing how the Bloomberg administration develops.

“I’m excited because not that many people know how smart and how driven he is,” Hyde said. “He is going to work every waking moment, and if he asked for help, I would jump.”

November 12, 2001
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