July 14, 2008
-- by Dave Johnson
I have been writing about Atria Senior Living, owned by a "Lazard-affiliate." Atria is big a chain of facilities where elderly people live. It offers assisted living care and "memory care"(which means Alzheimer's care facilities). Lazard is a big "Bermuda-based" (HA!) Wall Street "buyout firm."
Here's the deal. Big Wall Street firm Lazard buys a few senior-care facility chains and combines them into Atria. The "boomers" are aging and will need care so this is the Next Big Thing investment. Pension funds and others hand over to Lazard millions for this "investment," expecting Lazard to provide a rich return. This means the seniors (well, their incomes, actually) are the PRODUCT, not the customer here. The seniors are an annoyance, inefficient, demanding, in the way of maximizing revenue. Employees are even worse, of course, because they expect to get paid, and want to go home sometimes, and are generally in the way of the supreme goal of maximizing revenue.
And to complicate things Lazard has set up an extremely convoluted system of corporations "affiliated with" other corporations, some based in Bermuda (HA!) and none particularly traceable to being the actual owners of Atria. No one can really find who ultimately can be held accountable for the hundreds of violations of regulations that Atria commits.
So here is the thing. When you talk about a corporation doing something, who are you talking about? In reality you are talking about a few PEOPLE, not some anonymous corporation, PEOPLE. And when you talk about the people of a corporation you are not talking about Bob in Sales or Mary in Accounts Receivable. They are not the people who make decisions -- they aren't even asked. They are told from the top how it is going to be. When you talj about a corporation doing or saying something you are really talking about A FEW PEOPLE and the things these people do and say are not for "the company" they are necessarily for THEMSELVES. Corporations do not have voices or thoughts or ideas, a few people who have control of the resources of the corporation do, and always, always act for their OWN gain.
So who are we talking about today? Bruce Wasserstein is the guy at the top of this particular corporate food chain, reeling in the BIG bucks, and the residents of Atria are working to hold him accountable.
Saturday's New York Daily News had a story about this: Care-home grannies blast billionaire whose firm put their rents through roof
. . . a sneaker-clad foursome of seniors - representing numerous residents they say are too scared to come forward - recently tried to confront the ultrawealthy investment banker at his Rockefeller Center office."Lazard" claims that Lazard has no control over Atria, which is owned and operated by Lazard. Meanwhile those elderly people are squeezed by writing ever-greater checks, and the employees have to get squeezed and squeezed. Everyone is squeezed, Wasserstein gets ever-richer, and NO ONE can be held accountable.
. . . In a letter from the residents' board they tried to hand-deliver to Wasserstein, the women noted the stark disparity between his wealth and their fixed incomes.
"While residents at Atria struggle to manage rate increases ... the compensation packages for those at Lazard are in the millions."
Wasserstein lives in a duplex that combines the 10th and 11th stories of a posh Fifth Ave. building on the upper East Side. He also owns a Paris pied-à-terre, a sprawling East Hampton estate next door to Jerry Seinfeld and a Santa Barbara, Calif., spread worth $8.3million.
Lazard's board paid Wasserstein, who is worth at least $2 billion, more than $41million in salary and bonuses last year.
Atria is owned by a fund controlled by Lazard, although Lazard claims Wasserstein has no control over Atria's operations.
Nice system we got going here, huh? Works for Wasserstein. But not for the rest of us.
This post was sponsored in part by The Campaign To Improve Assisted Living.
Posted by Dave Johnson at July 14, 2008 8:59 AM
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