Hacking through the jungles of corporate finance

Power of Paper by Christopher Ondaatje. Publis-hed by HarperCollins. Distributed in Sri Lanka by Kiyawana Nuwana Book Shop, Nugegoda.
Price Rs. 1,800.
Reviewed by Nick Smith.

It is nearly twenty years since Christopher Ondaatje sold Pagurian, a group of fantastically profitable companies that grew out of a minor Canadian publishing imprint. Back in the 1960s, while others pitted their wits against book publishing’s twin demons of cash flow and distribution, Ondaatje carefully plotted his way through these hazards. Without ever borrowing a penny he amassed a colossal personal fortune through stealth, acuity and sheer hard work.

The Power of Paper is the story how Ondaatje generated this wealth, but it is not an autobiography, and those looking for one will be disappointed. While he might be the main character in the book, Ondaatje’s principal themes are the origins of money, how money works and how it is ultimately dangerous in its abstract form. The subtitle – A History, A Financial Adventure, and a Warning – explicitly lays out the concerns of this compulsively readable book from an author more recently associated with geographical and literary exploration. It may be that ambitious financiers will comb through The Power of Paper looking for clues that will help advance their career. But this is a shame because the additional depth the story gains from its well-researched history of finance going back some six millennia, means that there is more to The Power of Paper than merely a tale of corporate success.

What made Ondaatje different from the attention-grabbing entrepreneurs that now strew our television sets with reality game shows, is that he was in pursuit of neither easy money nor celebrity. As a financier his aims were much higher, no less than the restoration of his family’s pride. The young Ondaatje suffered a monumental blow when he was forced to leave school prematurely when his alcoholic father went bankrupt. Mortified, he vowed that this would never happen to his family again, and in his bid to set wrongs aright, the virtually penniless young man from Ceylon, after a brief stint in the City, headed west to Canada. This was no whim: by the time he left London he had already decided on how the emerging Canadian economy might work for him.

This was the moment of genius. While most vaguely seek their fortune, Ondaatje planned his. Even when almost starving in a downtown basement, pilfering milk and jamming on his guitar, he engineered a road map that led to success. It is easy to say now with hindsight that success was inevitable, but there were daring counter-intuitive moves that most security conscious business men would consider too dangerous. Ondaatje was prepared to take calculated risks and absorb such setbacks provided they gave him an ‘unfair advantage’.

It is possible that his first advantage was a talent for sport that was to lead him to represent Canada in the 1964 Olympic games as a bobsledder. This gave him confidence in the business world and encouraged him to publish Pagurian’s first book. The Prime Ministers of Canada started out with a modest print run, but ended up on the school syllabus and went on to sell over 600,000 copies. By keeping Pagurian’s headcount to a minimum, watching his cash flow like a hawk and meticulously researching his market, Ondaatje developed a formula that eventually led to his enormous success. There would be no speculations on untried novelists. Cookery books sold, so he sold cookery books. The successful young families wanted art prints to decorate their stylish new homes, so he sold them art prints.

As Ondaatje became more interested in finance, book publishing became less relevant, and the power of paper seized his imagination. But it also worried him. It was for Ondaatje a ‘lonely’ existence, and he didn’t want the word financier ‘emblazoned on my gravestone’. He also had a terrible foreshadowing of global economic disaster. In his final apocalyptic chapter he forecasts the collapse of civilization: too much money is owed by too many people to be sustainable and we’re heading for meltdown. But it’s not the fault of paper, says Ondaatje, who blames human psychology for a world the 18th century poet Alexander Pope refers to as ‘sunk in Lucre’s sordid charms.’

This nightmare vision of how it might all end meant that by the early 1990s he had withdrawn completely from the world of finance to write, to do some serious exploring, and become involved in the enigmatic world of philanthropy. By this point his family’s fortune and honour were more than restored and, having ‘made more money than I had ever dreamed possible’, he called it a day. Where once he hacked his way through the jungles of corporate finance, Ondaatje was now to hack through real jungles, searching for the source of the Nile, meeting people who live on less than a dollar a day and looking for leopards.

After I had read The Power of Paper I bumped into Christopher Ondaatje at the Royal Geographical Society where he told me that he had edited out great chunks of the book at the last minute. I wondered if these cuts were of financial technical detail that might alienate the non-specialist, but he told me they were in fact the more autobiographical passages. He said that he thought it detracted from the subject, which is of course finance. Many will feel that in making these excisions Ondaatje has left the reader short-changed. But that was never the point of this truly educational book. The extraordinary man behind the money really is another story.