John Gapper - A Fatal Debt

“You weren’t the only one he screwed,” I said.

Harry’s eyes narrowed as if he could hardly believe what I’d just said. Then he levered himself to his feet, leaning over me with his eyes a few inches from mine. I was shocked by their animal intensity. This was the Harry I’d always known was there: the ferocious one that Greene must have seen in his last seconds. I glanced through the glass panel in the door for help, but the guard was still absorbed in his paper.

“What the fuck do you mean by that? You should mind your own business. Why don’t you listen?” he hissed.

I tried to hold his gaze, but it wasn’t easy. Lauren had warned me to take care, and I knew then she was right. I’d always thought that Harry fell into another category from schizophrenics who were dangerous, but now I wasn’t sure. He really is violent , I thought- he didn’t just put it on in the Wall Street jungle . He stood over me for thirty seconds with his hands planted firmly on the table. Then his stare softened and he sat down, breathing unevenly.

“You don’t know what you’re talking about. You don’t know anything,” he said, as if reassuring himself.

“Tell me, then. What went wrong?” I said. “When we spoke in East Hampton, you said it was to do with mortgage bonds.”

His jaw was still clenched, but the question seemed to settle him, as if it were comforting to be back on finance and not fencing off hints about Lauren.

“Interested in Wall Street, are we?” he said, his voice like battery acid. “You wouldn’t understand that stuff even if I told you.”

“Try me.” I’d given up trying to be polite.

He gazed pointedly at me, as if I’d forced him to show that I was out of my depth, but he started talking. I wasn’t really interested in mortgages-I wanted to talk him down from his fury for a while before we got to the subject I was there for-but I tried to keep up with him as he spoke.

“Grayridge was into mortgage securitization. They took subprime mortgages from Texas and California and they bundled the paper into CDOs. They made money with that, so they got into synthetic CDOs, built from credit default swaps. I’m not going to try explaining that to you. They had a bunch named after elements. Cobalt, Gallium, Radon.”

“Elements?” I said.

“Yeah. Don’t ask me why. The guy who ran the origination desk was into chemistry.” He laughed grimly. “It was like alchemy in reverse. The substance the Elements turned into was shit.”

“So if the Elements were Mr. Greene’s responsibility, why didn’t the bank fire him when they went wrong? Why you?” I asked innocently.

Harry stared at me. “Now that is a good question. You’re asking the wrong guy, though. I mean, look.” He waved expansively at the tiny room. “Does this look like the Federal Reserve? Or the Treasury?”

“Who should I ask? Tom Henderson?”

Harry’s eyes registered that I knew something. “Maybe.”

“You told me you wanted your bank to be like Rosenthal but they wouldn’t allow it. I thought that was a strange thing to say, but I did some research. I found out that Henderson was at Rosenthal before the Treasury. You told me that Greene worked there, too. That’s a coincidence, isn’t it?”

Harry laughed bitterly. “Is it? That’s all you need to know about Wall Street, not the math about CDOs. Rosenthal runs the place, it always has. Why do you think Henderson is Treasury secretary? Count how many Treasury secretaries they’ve had. They’ve got Washington stitched up.”

I’d heard lots of people say Wall Street was a cabal. To hear one of its own saying that, even in jail, was different. Was Harry paranoid? I wondered again. There was something almost possessed about him, but perhaps he’d been driven to obsession. I thought of Henderson on the C-SPAN video, his quality of controlled calm.

“I went to my board, told them all the problems we’d had with Grayridge, how he’d landed us with all that crap. I didn’t know the full story then. I …” He paused and seemed to think better of what he’d been about to tell me. “They didn’t listen. They’d all had calls from Henderson saying he wanted me out.”

“Could he do that?”

“He could do whatever the hell he wanted. They needed the Treasury’s money. They were cowards.”

We’d reached the moment for which I’d come to Riverhead.

“So Mr. Greene’s dead but Mr. Henderson’s doing just fine, isn’t he? What does that make you feel?” I said.

Harry grimaced, then got up and walked a couple of paces to the door, looking through the pane of glass set into it to check on the guard outside. Then he turned to face me with his back to it, his face fervent.

“You know what I feel , Doctor?” he said contemptuously. “I feel like doing to him what I did to Greene.”

He’d given me what I’d come for-a threat to Henderson. It was all I needed and I didn’t want to spend any more time there, although I’d learned some other useful things. I signaled to the guard and got up, leaving Harry staring bitterly after me. The road was clear when I drove out of the lot, but I stayed well below the speed limit until I was a long way clear of Suffolk County. I didn’t want to be hauled off to Yaphank again.

Somewhere on the journey from New York to Washington, D.C., maybe around Chesapeake Bay, you cross the border into the South. The air turns softer, the humidity rises, and you are deposited off the Acela at Union Station into another country entirely, with its slow cabs and steadier, more baroque manners than its Yankee cousin.

It was a bright June day, with all of the city’s monuments shining in the sun, and I stood for a few minutes gathering my thoughts on the paved section of Pennsylvania Avenue, where tourists massed in groups next to the White House railings. I was at the edge of the strip opposite the eight Greek columns of the Treasury, its granite facade drab and gray next to its iridescent neighbor.

I’d arrived early, having caught the early train out of New York, and I pulled a dollar bill from my pocket to look at it. On it were the crumpled face of George Washington, the Treasury seal in green, and Tom Henderson’s scrawled signature. To the left, over the B on the Federal Reserve Bank of New York seal, was a promise in uppercase letters: THIS NOTE IS LEGAL TENDER FOR ALL DEBTS, PUBLIC AND PRIVATE. I’d come to ask about a fatal debt.

Having climbed the steps and passed security, I was directed up a stone staircase to the third floor. I set out along a dim corridor, checking a piece of paper on which I had scrawled the number of the room. When I looked up, I saw to my surprise the man I’d come to visit. He was standing by himself about fifty yards down the corridor, gazing at me kindly. On the C-SPAN video, I’d seen senators melt in his presence, but I hadn’t grasped why until that moment. He stood in socks with a gentle smile on his face as if he had all the time in the world. He looked completely relaxed, his shoulders at ease and his face soft and knowing, like a beneficent monarch. As I reached him, he stepped forward one pace to squeeze my hand.

“Dr. Cowper, I presume,” he said, pronouncing my name correctly and smiling wryly at his own Victorian reference.

He led me into a high-ceilinged room with ornate plasterwork and a chandelier that looked as if it could do with a dust. It was a drawing room, I guessed, with drapes that hung in folds and Louis XV-style chairs arranged by a mahogany table. As we entered it, a young man appeared. He was plump, with a bland smile and rimless glasses-impossible to pick out in a crowd. Henderson waved me to an armchair and sat opposite, while his new companion perched a few feet behind him like a stage prompt.