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  CONTENTS

  Author’s Note

  ONE

  The Ice Age

  TWO

  The Phantom

  THREE

  Mr. Lee and Mr. J. J.

  FOUR

  While There Is Death There Is Hope

  FIVE

  Bastards, Criminals, and Drunks

  SIX

  Changing of the Guard

  SEVEN

  New York, New York, a Helluva Mess

  EIGHT

  The Coup

  NINE

  Rotten to the Core

  TEN

  Horsing Around

  ELEVEN

  The Paintman Cometh

  TWELVE

  The Jockey

  THIRTEEN

  The One

  FOURTEEN

  The Interloper

  FIFTEEN

  I Love New York, Especially in the Evening

  SIXTEEN

  The Coiled Cobra

  SEVENTEEN

  The Bernie and Jerry Show

  EIGHTEEN

  The Jockey and the Godfather

  NINETEEN

  Civil War

  TWENTY

  And the Winner Is . . .

  TWENTY-ONE

  CAT$

  TWENTY-TWO

  Mesmerizing Temptation

  TWENTY-THREE

  End of the Line

  TWENTY-FOUR

  The British Are Coming! The British Are Coming!

  TWENTY-FIVE

  Pick-a-Little, Talk-a-Little

  TWENTY-SIX

  Nothing Matters

  EPILOGUE

  Exit Music

  Photographs

  Acknowledgments

  About Michael Riedel

  Notes

  Bibliography

  Index

  For my parents,

  and for my friends

  Mike Kuchwara, Jacques le Sourd, and Martin Gottfried

  AUTHOR’S NOTE

  The first time I ever heard the names “Shubert” and “Nederlander” would have been in the spring of 1987, when I had an internship in the office of Broadway producer Elizabeth I. McCann. I was nineteen and studying history at Columbia. I liked Broadway and knew something about its famous shows, writers, and performers. But I couldn’t have told you what a producer did, let alone a theater owner like the Shuberts or the Nederlanders.

  As it so happened, McCann was coproducing Les Liaisons Dangereuses that spring with both companies. One of my first jobs was to deliver the opening night guest list to their offices.

  I went to the Nederlander headquarters above the Palace Theatre first. I rode up in a rickety old cage of an elevator operated by an ancient black man who opened his Bible and prayed for me. I stepped out of the elevator into a dusty office full of shabby furniture. I handed the envelope to the receptionist, who was on the phone and barely looked at me. Everybody else in the office was on the phone as well. You could take your pick of at least a half dozen conversations. As I left, I caught sight of a man in another office. His feet were on the desk, and he was yelling into his phone. All that was missing was a cigar in his mouth. He looked like the boss.

  I crossed Times Square to Shubert Alley and walked through a discreet doorway next to the Shubert Theatre. Another small, though not rickety, elevator took me up to the executive offices of the Shubert Organization. The doors opened on to what looked to me like a suite from the Palace of Versailles. The furniture was plush and elegant. Sunlight streamed in from a skylight. Tapestries like something you’d find in the Cloisters hung from the walls. There were bookcases full of leather-bound books. I had no idea such luxury existed in the heart of seedy Times Square. The place was silent. The receptionist sat behind an enormous desk. I handed her the envelope. “Thank you,” she whispered.

  I didn’t know it at the time, but what I had seen that day was power. At the Nederlanders, the power was scrappy and energetic. At the Shuberts, it was quiet, rich, abiding, and intimidating.

  I never met the people who wielded that power during my internship. I barely met my boss, Liz McCann. She never bothered to learn my name—I was “the kid”—and to this day she has no memory of my having worked for her. Years later I told her she gave me my start in the theater. “I have that to add to my sins?” she said.

  But I never forgot my brief glimpses of where the Shuberts and the Nederlanders conducted their affairs.

  In 1989, just a few days after graduation, I landed a job as the managing editor of TheaterWeek, a tiny magazine run out of an old storage room at 28 West Twenty-Fifth Street. I started hearing the names Shubert and Nederlander all the time, and now that I had a perch in the theater world (on the lowest branch), I was determined to meet them.

  I first saw Bernard B. Jacobs, the president of the Shubert Organization, in 1992 at a benefit for the United Jewish Appeal. He was being honored, and everybody in the room lined up to pay their respects. It was like the wedding scene in The Godfather. I introduced myself as the managing editor of TheaterWeek—and made no discernable impression.

  I made a little more headway with Gerald Schoenfeld, the chairman of the Shubert Organization. He was voluble and engaging. Afterward, whenever I ran into him at an event, he was always happy to talk. But I didn’t get to know him well until after Jacobs’s death in 1996. By then I was the theater reporter for the New York Daily News and often called him for a quote. He was an excellent source. He didn’t leak stories, but he confirmed what I’d heard, and provided background and perspective.

  I lunched with him at Frankie & Johnnie’s Steakhouse and spent afternoons in his office watching him at work. I was privy to everything, with the stipulation that my visits were off the record. He delighted in showing me around the executive offices, and regaled me with tales of working for J. J. Shubert, the youngest of the three brothers who founded the empire. I had a glimmer back then that there was a story to be told about the Shuberts and Broadway, but I had no idea I’d be the one to tell it.

  I also got to know Philip J. Smith, who became second-in-command after Jacobs died. His knowledge of the Shuberts was vast, and he was a superb storyteller. He could remember who was in the room during a crucial meeting, where everybody sat, and what they said. He was close to Jacobs, and he impressed upon me how important Bernie and Jerry were to the Shubert Organization and Broadway in the 1970s, when Times Square was a mess, the theater business was in trouble, and New York City was careening toward bankruptcy.

  I developed a friendship with Jacobs’s widow, Betty, and spent several summer weekends with her at her house on Shelter Island. One afternoon she showed me an interview Jacobs had done for the League of American Theaters and Producers shortly before he died. He gave a candid, funny, and insightful account of how he and Schoenfeld fought their way to the top of the Shubert empire and to the top of the American theater. Once again, I had a sense that there was a story to be told here.

  I got to know James M. Nederlander, the man I saw with his feet up on his desk that day in 1987, through my friendship with his son Jimmy Jr. and Jimmy Jr.’s wife, Margo. Over a couple of dinners, Jimmy Sr. told me about the family theater business in Detroit and his early years in New York. “Senior loves talking to you,” Margo said. About five years ago, she asked if I would do some taped interviews with him for a possible memoir. I lunched with him once a week for about a year, enjoying colorful tales of his f
ather’s rivalry with the Shubert brothers, and his own battles with Schoenfeld and Jacobs. For the third time, I remember thinking there was a story there.

  As I got to know the Shuberts and the Nederlanders, I was covering—first for the News and then, starting in 1998, the New York Post—a Broadway that was emerging from the backwaters of the entertainment industry to become the multibillion-dollar global empire it is today.

  In 1989, the first year I attended the Tony Awards, Broadway was so thin that only three shows were nominated for Best Musical—Starmites (a musical about the guardian angels of “Innerspace”), Black and Blue (a revue of songs by Fats Waller, Eubie Blake, and Duke Ellington), and Jerome Robbins’ Broadway (a revue of scenes and dances from the director’s famous musicals). Since then, I’ve covered Tony Awards that featured such musicals as Beauty and the Beast, Rent, The Lion King, Ragtime, The Producers, Hairspray, Chicago, Mamma Mia!, Wicked, Billy Elliot, and The Book of Mormon—productions that have played all over the world and made hundreds of millions of dollars.

  I’ve also seen the neighborhood I’ve worked in for twenty-five years, Times Square, go from a squalid place people avoided to the shiny tourist attraction it is today. The Times Square of the 1980s never bothered me. It was rough but fun, and it felt like nowhere else in America. But I don’t deride the Times Square of 2015, which detractors bemoan as “Disneyfied.” The throngs of gaping tourists you have to thread your way through to get to the theater on a summer night can be exasperating. But cities change, and I’d rather a thriving, if touristy, Times Square than a sad, derelict one.

  Physically, the Times Square of today has changed enormously from that of the seventies and eighties, except for West Forty-Fourth and Forty-Fifth Streets, which are still lined with Broadway theaters that were built in the early part of the twentieth century. Most of the businesses in Times Square have come and gone, but Broadway and its theaters have always been there.

  “There’s only one Broadway, and it’s in New York,” said the narrator of the famous I Love New York TV commercials I watched as a kid in upstate New York in the seventies and eighties.

  The connection between the fortunes of Broadway and New York was the key to pulling together all the stories I’d heard from Jerry Schoenfeld, Phil Smith, Betty Jacobs, and Jimmy Nederlander. Like the city itself, Broadway nearly collapsed in the 1970s. But a handful of people—the Shuberts, the Nederlanders, and some others you’ll meet in these pages—stood by it and shored it up. In so doing, they helped lift the fortunes of Times Square and, I think, New York City itself.

  This book is about their struggle, and if it makes any impression at all I hope it’s that Broadway and its fractious band of colorful characters were as important to the survival of this city as any Wall Street titan, real estate magnate, civic leader, or politician.

  CHAPTER ONE

  The Ice Age

  This is a very weird way to begin an investigation, David Clurman thought as he listened to the anonymous caller on the other end of the line.

  A special assistant to the powerful New York State attorney general, Louis J. Lefkowitz, Clurman knew nothing about the economics of the Broadway theater. His speciality was real estate and securities. At thirty-five, he’d already made a name for himself as a tough investigator of the city’s powerful real estate magnates, authoring the first law in New York state history regulating the sales of co-ops and condominiums.

  Important, to be sure; glamorous, hardly.

  But here he was, sitting in his office at 80 Centre Street in the spring of 1963, listening to a fast-talking, agitated, self-described “angel,” which, as the caller explained to Clurman, was showbiz slang for backers of Broadway shows.

  “I’m not going to give you my name,” the angel said. “But you should look into what goes on with the money on Broadway.”

  Clurman asked why the angel was concerned.

  “Well, I made an investment in a play, and the producer used the money to buy a lobster boat in Montauk.”

  “A lobster boat?” Clurman said. This was indeed a strange way to begin an investigation.

  But Clurman, who could smell flimflam down to the paperclips, was interested. He spent nearly an hour on the phone with the tipster, getting a crash course in the murky world of Broadway financing. Investors, it seemed, were in the dark about everything—production costs, weekly running costs, where the money they invested went, whether the shows were fully capitalized or not, how much they lost when they closed. Sometimes their money went into the productions they wanted to support; sometimes it wound up in shows they didn’t even know about. And sometimes it went to buy lobster boats in Montauk.

  Producers wanted to take an angel’s money, give him a hug on opening night, give him some money if the show worked, and if it didn’t, well, that’s Broadway—it’s a crap shoot. Move on to the next show, next season. It’s going to be a surefire hit. Stick with me, the producers seemed to say, because I have a script on my desk right now that’s a winner.

  “What about accountants?” Clurman asked. “Don’t you get a complete accounting of the production after it closes?”

  “Accountants?” the caller responded, laughing. They just accept whatever documents the producers give them. Ledgers, balance sheets, profit and loss statements—they don’t exist on Broadway. Angels were like slot machine players. Bewitched by the twinkling lights, they put in quarter after quarter, hoping to hit the jackpot. And if they did—if they backed The Music Man, My Fair Lady, Oliver!—the quarters come so fast, who thought about where all those other quarters went?

  Broadway’s a casino, New York City’s very own Las Vegas.

  “Everything he told me was so antithetical to the whole idea of disclosure that it amazed me,” Clurman said, remembering the phone call nearly fifty years later.

  Clurman thanked the caller and hung up. Something was going on here, he thought, something worth investigating. You can’t have a business in New York City—a business as high profile and as important to the life of the city as Broadway—that doesn’t abide by basic rules of accounting.

  Financially, it sounded like the Wild, Wild West—with tap shoes.

  Clurman left his office on the way to lunch, passing the room for “the boys,” as Attorney General Lefkowitz called the reporters who covered him. Lefkowitz, popular, charming, a politician who loved to be in the papers, liked the boys and had given them a room of their own near his office in the state office building. As Clurman walked by, he ran into Lawrence O’Kane, a reporter for the New York Times. Clurman liked O’Kane. He was smart, curious, fair. They’d talked about a number of cases Clurman had investigated, and he found O’Kane to be a good sounding board.

  Clurman asked O’Kane if he knew anything about the theater. The Times, after all, was located on West Forty-Third Street, right in the heart of Broadway. It covered the theater aggressively and its critics and theater reporters—Brooks Atkinson, Sam Zolotow, Louis Funke—were, to Times readers, household names.

  Not really, O’Kane said. Why?

  Clurman recounted his conversation with the angel. He was talking to O’Kane as a friend, telling him about this odd call. There were no names mentioned, no talk of an investigation, just a general discussion about some funny business on Broadway.

  O’Kane was interested. Clurman said he’d tell him if anything came of it.

  • • •

  The next morning, on his way to the subway, Clurman bought a copy of the New York Times. Standing on the platform, he glanced at the headlines above the fold—KENNEDY MEETING WITH MACMILLAN LIKELY JUNE 29–30; RISE IN TEEN-AGE JOBLESS PUSHES U.S. RATE TO 5.9%. Then he looked at the stories below the fold. One caught his eye. FINANCING PRACTICES IN THEATER UNDER BROADWAY INQUIRY BY STATE.

  “A ‘far-reaching’ investigation of theatrical practices—both on and Off-Broadway—is under way in the office of the State Attorney General,” the article began. Lefkowitz, O’Kane wrote, “decided to make the investigation a
fter a preliminary study had given indications of ‘peculiar’ financing methods in the industry and a possible need for corrective legislation.”

  Clurman was stunned. Holy God, he thought. What is going on? He’d never dreamed that a casual conversation with one of the boys would wind up as front-page news in the New York Times. His preliminary study consisted of a few notes he’d scribbled on a yellow legal pad during the phone call.

  When he arrived at 80 Centre Street, Lefkowitz summoned him to his office. “How come you didn’t tell me about this?” Lefkowitz demanded.

  Clurman explained that he thought his conversation with O’Kane had been casual. It was not in any way, he said, an official announcement. Still, he added, it might be worth looking into the financial practices of Broadway. And, as this morning’s Times proved, it would get headlines.

  “Can I conduct an inquiry into this to see what’s going on?” he asked.

  Lefkowitz, enticed by headlines, gave him the go ahead.

  Underneath his quiet, scholarly demeanor, Clurman had the investigating zeal of Inspector Javert. Let the hunt begin, he thought.

  • • •

  That morning, in Shubert Alley, the town square of Broadway, everybody was on edge. There had been investigations in the past about money flying around the theater. They always seemed to coincide with the election of the attorney general. But they never amounted to much. This one, however, made the front page of the New York Times, which meant that it was serious. Emanuel “Manny” Azenberg, then a young company manager, recalled, “Everybody that day was walking around with a little brown spot on the back of their pants.”

  • • •

  Clurman didn’t know where to begin. He was now in charge of a “far-reaching” investigation into the financial practices of Broadway about which, aside from being a casual theatergoer who had enjoyed My Fair Lady, he knew nothing.

  And then he got another call.

  If you were a lawyer in 1963, Morris Ernst was a name you knew. A founder of the American Civil Liberties Union, Ernst represented Random House in its fight to get James Joyce’s Ulysses published in the United States despite state-by-state laws against obscenity. A fixture of New York society, he had been close to Franklin Roosevelt, Harry Truman, and several Supreme Court justices. He loved the theater, and numbered among his friends Edna Ferber, Groucho Marx, E. B. White, and Charles Addams.