• David Rubenstein, one of the richest men in the world, proposed an essay contest a year ago at the Alaska Federation of Natives convention, offering $10,000 each to the winners.
At the AFN convention last week, the seven winning essays were announced.
The assignment was to write 500 to 1,600 words on how Natives can best participate in the economic renewal and what contributions they can make to the U.S. and international economies.
The contest was open to Alaska Natives, Native Hawaiians and American Indians. Nearly 300 people competed.
Three of the winners are Alaskans —Charles Ralston of the Nulato Tribal Council and Doyon; Harold Frank Jr. of the Haida Indian Tribe; and Methanie Ongtooguk of Kotzebue and Fairbanks.
The winning essays are at www.nativeinsight.org.
Providing the financing for this contest is just one way in which Rubenstein, whose fortune is estimated by Forbes at $2.5 billion, is making a mark on Alaska. He is married to Alice Rogoff, who started the Alaska House in New York City. It is a gallery for the display of Native art and a place, as he put it, “for people to come in New York to learn about Alaska.”
Rogoff, former chief financial officer of U.S. News and World Report, is also the majority owner and publisher of the on-line Alaska newspaper “Alaska Dispatch,” an Anchorage-based enterprise that has some first-rate reporters and editors as contributors and staffers.
Rogoff first came to Alaska in 2002, an experience that left her “awestruck with the beauty and the culture,” she told Tony Hopfinger and Amanda Coyne of the Alaska Dispatch.
She said she “slowly became aware of how divided this state is, and how the media, if not complicit, is certainly not partaking in the solution. It simply does not do an adequate job in representing the hopes and dreams and fears of all the people who live in this state. And it’s not telling Alaska’s story to the world,” Hopfinger and Coyne quoted her as saying this summer.
She wanted to become a pilot and moved to Alaska, where the skies are not so crowded, the Anchorage Press said in a story last month on the Alaska Dispatch. Rogoff has her plane parked in the hangar on Merrill Field when the Dispatch has its offices.
Her husband flies from 250 to 300 days a year, according to various published reports, traveling around the world on business.
His involvement with Alaska goes back to the 1980s. A lawyer and former official in the Carter administration, in 1987 he co-founded the Carlyle Group, a private equity firm named after a New York hotel. The company specialized in buying companies and then trying to sell them for a big profit.
But as a 2003 article in the Washington Post put it, the company’s “first successful venture sounds like something from a spam e-mail.”
"Rubenstein had discovered a legal loophole allowing Native Americans in Alaska to sell their tax losses, and he did a brief, brisk business connecting Eskimos with corporations in search of a write-off. Congress quickly closed the loophole, and Carlyle moved on in search of companies to buy," the Post said.
Speaking to the Economic Club of Washington in 2004, Rubenstein described it another way:
"A very clever bill had been passed by Sen. (Ted) Stevens. Set up in the early 1970s, it said that Alaska Native corporations could sell their tax losses to other corporations. There were about $50 million of these losses. It was going to cost the Treasury a modest amount of money generally to start."
Rubenstein said he and his partner Steve Norris, "came up with the idea of actually representing a lot of these Alaskan native corporations and selling their losses to large corporations that wanted to buy them for a very favorable tax treatment."
But it turned out that the losses the Alaska Native Corporations were far greater than $50 million, which provided a major financial boom to the corporations at a time when many were struggling.
“What really happened was, we came up with the idea that the Alaskan Native corporations actually had more losses than people thought, because they might have had $50 million on their books, but they had been given timber, let’s say 20 years ago, and if you went back and valued it, it was worth a billion dollars, but actually was worth $100 million. That is a $900 million loss that they hadn’t taken. We told them how they could take it, and we went ahead and sold a $900 million loss. We sold lots of these. Other people came up with the same idea as well. But we sold $6 or $7 or $8 billion of losses to companies,” Rubenstein said.
One of his habits during the Carter administration was to stay late at the office and go into the president’s private study, putting whatever memo he had to offer at the top of the pile, so the president would be sure to see it.
Others in the administration wanted to know what he was up to and an official of the Office of Management and Budget managed to stay even later than he did and secure the top spot in the Carter in-box.
“The president read their memo the next morning, went their way, and I found out a few hours later what happened. I was furious that someone had beaten me at my own game. I stopped talking to that person for about 4 months, but now she is my wife. I married her,” he said.
Rubenstein, now 60, has been giving money away at a rapid pace for the past six years, the New York Times said last month.
The comment was made in a story about a recent $10 million gift to Lincoln Center in New York City.
In 2007 he bought a copy of the Magna Carta for $21 million and gave it to the National Archives. The Times said he loaned a copy of the Declaration of Independence to the National Archives and he has loaned a copy of the Emancipation Proclamation to the Smithsonian.
“My view is,” he told the Times, “If you have money, you can spend it, you can save it, or you can give it away.”
In the most recent listing of the richest Americans compiled by Forbes, Rubenstein is one of 16 billionaires ranked No. 123, with an estimated net worth of $2.5 billion.
Forbes offered this statistical snapshot:
Leveraged buyout titan’s firm showing resilience. Carlyle Group boasts $86 billion in assets, up 10% in 24 months despite tumultuous markets, bankruptcy of 3 portfolio companies and collapse of Amsterdam-listed mortgage bond fund. Formed firm with William Conway Jr., Daniel D’Aniello 1987; early success putting ex-politicos to work buying defense-oriented businesses. Turned around operations, flipped for big profits. Vilified in Michael Moore’s Fahrenheit 9/11 for investing Bin Laden family money. Rehabbing image ever since; severed ties with unsavory clients and political advisors years ago. Today outfit manages 64 separate funds. Heartened by recent uptick in deal activity: “Private equity is back.”