Buffett had craved a niche in the publishing big leagues for quite some time. Newspapers, which were mostly family-owned businesses, had recently gone through a spasm of selling themselves. He and Charlie Munger had worked ceaselessly and unsuccessfully to buy everything from the Cincinnati Enquirer1 to the Albuquerque Tribune.2
In 1971, Buffett called Charles Peters, publisher of the Washington Monthly, asking him for an introduction to Washington Post publisher Katharine Graham. Buffett said that he and Munger had bought some stock in the New Yorker and wanted to buy the whole magazine.3 They wanted a partner in the purchase and thought the Washington Post might be the right choice.
Peters wasn’t surprised to get the call. Aha, he thought, Buffett must be interested in the Post stock now that the Graham family is taking the company public. Perhaps Buffett thought that if the Washington Monthly turned into an entry point to making a killing on the Post, then the failed investment could be justified financially.
Buffett had never bought public offerings, which he felt were overhyped and overpromoted.4 So he had no plans to buy Post stock—at least for now—but Peters set up the meeting and Buffett and Munger flew to Washington to see Kay Graham at the Washington Post headquarters.
When Graham took over the newspaper eight years earlier, at age forty-six, she was a widow with four children and had never worked in a business. Now she found herself preparing for the challenge of running a public company under the unremitting scrutiny of investors and the press.
“Charlie and I met her very, very briefly, for twenty minutes. I had no idea what she was like. The idea that she’d be frightened of her own business—I didn’t know any of that. It was raining like hell, so we came in looking like a couple of drowned rats, and you know how we dress anyway.”
At the time, Graham had no interest in the New Yorker purchase that had prompted the visit—and there was nothing in the meeting to suggest that she and Buffett would one day be great friends. He made no impression on her whatsoever. For his part, he did not find her particularly attractive—even though she was a handsome woman—for she lacked the soft femininity and caretaking qualities of his ideal, Daisy Mae. Moreover, their backgrounds were worlds apart.
Katharine Graham, born just before the twenties started to roar, was the daughter of a rich father, investor and Post publisher Eugene Meyer, and a self-absorbed mother, Agnes—“Big Ag,” as the family called her behind her back because of her imposing stature and, as the years passed, increasing girth. Agnes, who had married her Jewish husband at least in part for his money, was passionate about Chinese art, music, literature, and other cultural interests, but indifferent to her husband and their five children. The family shuttled among their mansion in Mount Kisco, their full-floor apartment on Fifth Avenue in New York City, and a large, dark, red-brick Victorian house in Washington, D.C.
Katharine spent her early years under the rule of Agnes at the Mount Kisco estate, which the family referred to as the “farm.” Every vegetable and piece of fruit on the dining table came from the surrounding fields and orchards. Kay ate meat from the farm’s own pigs and chickens and drank milk from its Jersey cows. The Westchester mansion’s walls were covered with magnificent Chinese paintings; it boasted every status symbol of the era: an indoor swimming pool, a bowling alley, tennis courts, a massive pipe organ. Kay was taken on incredible vacations, once visiting Albert Einstein himself in Germany. When Agnes took the children camping to teach them independence, they roughed it accompanied by five ranch hands, eleven saddle horses, and seventeen packhorses.
But the children had to make an appointment to see their own mother. They gobbled down their meals because Agnes, served first at the long dining-room table, began eating as the footmen moved around serving everyone else—and had the others’ plates snatched away the instant that she herself had finished. By her own admission, she did not love her children. She left them to be raised by nannies, governesses, and riding instructors; she sent them off to summer camps, boarding schools, and dancing class. Their only playmates were one another and the servants’ children. Agnes drank heavily, pursued flirtatious and obsessive (although apparently platonic) relationships with a number of famous men, and treated all other women as inferior, her own daughters among them. She compared Kay unfavorably to America’s sweetheart, Shirley Temple, the singing, dancing, smiling child star with golden blond ringlets.5 “If I said I loved The Three Musketeers,” Graham recalled, “she responded by saying I couldn’t really appreciate it unless I had read it in French as she had.”6 Kay was trained like a hybrid orchid, beautifully pampered, savagely critiqued for her show potential, and otherwise largely ignored. Still, by the time she reached the Madeira School in Washington, D.C., she had somehow managed to learn the skills of popularity and was elected head of her class—most surprising at that time and in that place because she was half Jewish.
In Protestant Mount Kisco, the family was socially shunned. At Agnes’s insistence the children were raised as Protestants—albeit nonobservant ones—and were not even aware that their father was Jewish, leaving Graham ignorant of the reason for their isolation. She would later be stunned at Vassar when a friend apologized because someone had made a bigoted remark about Jews in front of her. She reflected with hindsight that this clash in her bloodlines “leaves you either a good survival capacity or a total mess.”7 Or, perhaps, both.
From her mother, Kay learned to be ungenerous about small things, fearful of being cheated, unable to give things away, and certain that people were trying to take advantage of her. By her own description, she also grew up inclined to be bossy.8 Yet others saw in her qualities of naiveté, candor, generosity, and open-heartedness that she herself seemed unable to acknowledge.
She felt closer to her awkward, distant, yet supportive father. To Eugene Meyer, she attributed her zeal for tiny economies—compulsively turning out lights, never wasting anything. Her father’s talent for such economies, along with great infusions of time, money, and energy, had been crucial in keeping the ailing Washington Post alive while Kay was growing up, when the paper ranked fifth in a field of five in the capital area, far behind the dominant paper, the Washington Evening Star.9 When Meyer began thinking of retiring in 1942, Kay’s brother, Bill, a doctor, had no interest in running an unprofitable newspaper, so the duty fell to Kay and her new husband, Philip Graham. Kay was besotted with Phil, and so convinced of her own lowliness that she accepted as a matter of course her father’s decision to sell Phil nearly two-thirds of the Post’s voting stock, giving him absolute control. Meyer did it because, he said, no man should have to work for his wife. Kay got the remainder.10
When Phil Graham took it over, matters were out of hand. The newsroom and the circulation department stayed busy playing the horses and drinking. When Meyer was out of town, the office boy started every morning by bringing one man a half pint of booze and the Daily Racing Form.11
Phil Graham got the place shipshape, gave it an identity by fostering vigorous political coverage, and stamped its editorial page with a strong liberal voice. He bought Newsweek magazine and several television stations, and proved to be a brilliant publisher. But over time, drinking binges, a violent temper, unstable moods, and a cruel sense of humor showed themselves, with particularly devastating effects on his wife. When Katharine gained weight, he called her “Porky” and bought her a porcelain pig. She thought so little of herself that she found the joke funny and put the pig on the porch for display.
“I was very shy,” she said. “I was afraid to be left alone with anybody because I’d bore them. I didn’t speak when we went out; I let him speak.… He was really brilliant and funny. Marvelous combination.”12
Her husband played on her fears. When they were out with friends, Phil would look at her in a certain way when she was talking; it told her that he thought she was going on too long and boring people. She was convinced that she occupied some lesser sphere and could never meet the expected—but impossible—standard of living up to Shirley Temple. Over time, she ceased speaking in public.13 She grew so insecure that she vomited before parties. And by some accounts, the way Phil treated her in private was even worse.14 Phil would drink and build up to a violent rage; then she froze and shut down.
She never confronted Phil, even when he embarked on a series of affairs with other women that supposedly included swapping mistresses with Jack Kennedy.15 Instead, she defended him, swept away by the force of his personality, wit, and brains. The more cruelly he behaved, the more she seemed to want to please him.16 “I thought that Phil literally created me,” she said. “My interests were better. I was surer of myself.”17 He thought she was lucky to have him, and she did too. When he finally left her for Newsweek staffer Robin Webb, she was stunned by the response of one of her friends, who said, “Good!” It had never occurred to her that she might be better off without Phil. But then he began trying to take the paper away from her, since he controlled two-thirds of the stock. Kay was terrified that she would lose her family’s newspaper.
In 1963, in the midst of her battle to keep the paper, Phil Graham suffered a spectacular public breakdown, was diagnosed with manic depression, and committed himself to a mental institution. Six weeks later, he talked his way out of the hospital for a weekend leave. He came home to Glen Welby, the Grahams’ sprawling rural Virginia farm retreat. On Saturday, after eating lunch with Kay, he shot himself in a downstairs bathroom while she was upstairs taking a nap. He was forty-eight.
His suicide left Kay with the paper, no longer threatened with its loss. She dreaded being in charge, but even though some suggested that she sell, she was absolutely determined to keep it; she saw her stewardship as a holding action until the next generation was ready to take over. “I didn’t know anything about management,” she said. “I didn’t know anything about complicated editorial issues. I didn’t know how to use a secretary. I didn’t know big things and small things and, worse still, I couldn’t tell them apart.”18
While Graham could project a determined confidence at times, she began to rely on other people as she constantly rethought and questioned her own decisions. “I just kept trying to learn the issues from the men who were running things,” she wrote. “And of course, they were all men.” She never trusted them or anyone else—but, of course, no one close to her had ever treated her in a trustworthy way. She would tentatively extend her confidence to someone, then second-guess herself and pull back. Alternately enthused, then disenchanted with her executives, she gained a fearsome reputation in the office. And all the while, she never stopped seeking advice.
“As decisions would come along in the course of a day where she was very uncertain how to proceed,” says her son Don, “she was literally reinventing the wheel. She would be called upon to be a top manager of a company when she’d never been a bottom manager of a company. She hadn’t watched people who were CEOs, except the way you watch your husband or your dad.
“And so she had the great habit, when she faced what she thought of as a difficult decision—it usually was a difficult decision—she would call directors, she would call friends whom she thought might have a relevant experience. It was partly getting advice to help her handle the problem. And it was partly trying out the friends as advisers to see who seemed to make sense and whom she’d call the next time.”19
Early on, Graham began to lean on Fritz Beebe, a lawyer and the chairman of the Washington Post Company.20 By then, the Post was the smallest of three remaining Washington newspapers, with $85 million in yearly revenues and $4 million in profits.
Gradually she grew into her role. She and her managing editor, Ben Bradlee, had a vision of a national paper that would set a standard to rival the New York Times. Bradlee, a Harvard graduate who had worked closely with intelligence agencies before turning to journalism, was funny, brilliant, had an unexpected saltiness that belied his background. He brought out the best in Graham and encouraged reporters to thrive. Before long, the Post had developed a reputation for solid journalism. Three years after taking over the paper, Graham made Bradlee executive editor.
In 1970 Kay was freed from the tyranny of her mother, Agnes, who died in bed while Kay was visiting Mount Kisco on Labor Day weekend. While the death of Agnes Meyer relieved Graham of a burden, it did not cure her insecurities. But she would soon find she had grown into her job at the Post.
In March 1971, amid continuing protests of the Vietnam War, the New York Times was leaked a copy of the Pentagon Papers—a top-secret and ruthlessly honest history of the decision-making that led the country into and through Vietnam.21 The Pentagon Papers showed conclusively that the government had perpetrated a vast deception on the American public. The Times published its account of the scheme on Sunday, June 13.
On June 15, about two weeks after Buffett and Munger had gone down to Washington to meet Graham in her office, a federal district court enjoined the Times from publishing most of the Pentagon Papers. It was the first time in history that a U.S. judge had restrained publication by a newspaper, raising a major constitutional question.
The Post, mortified at having been scooped, was determined to get its hands on the Pentagon Papers. Through informed guesswork and contacts, an editor tracked down their source, Daniel Ellsberg, an expert on the Vietnam War. The editor flew to Boston with an empty suitcase and brought the Pentagon Papers back to Washington.
By then Graham had mastered some of the basics of being a publisher, though she remained deferential and ill at ease. Further, “we were in the middle of going public [but] we hadn’t sold the stock,” she recalled. “It was a terribly sensitive time for the company, and we could have been very badly hurt if we’d been to court or criminally enjoined.… The business people were all saying either don’t do it or wait a day, and the lawyers were saying don’t do it. And the editors were on the other phone saying you’ve got to do it.”
“I would have had to quit if we hadn’t published it,” says Ben Bradlee. “A lot of people would have quit.”
“Everybody knew we had those papers,” Graham wrote later. “It was terribly important to maintain the momentum after the Times had been stopped,” with a Constitutional issue at stake. “And I felt what Ben said, that the editors would really be demoralized, that the news floor would be demoralized, that a great deal depended on our doing it.”
Notified on the terrace of her Georgetown mansion that beautiful June afternoon that she had a call, Graham went into her library and sat down on a small sofa to pick up the phone. Post chairman Fritz Beebe was on the line. He told her, “I’m afraid you are going to have to decide.” Graham asked Beebe what he would do, and he said that he guessed he wouldn’t.
“Why can’t we wait a day?” said Graham. “The Times discussed this for three months.” Now Bradlee and other editors joined the call. The grapevine, they said, knows we’ve got the papers, journalists inside and out are watching us. We’ve got to go, and we’ve got to go tonight.
Meanwhile, in the library, Paul Ignatius, president of the Post, was standing at Graham’s side, saying, “each time more insistently—‘Wait a day, wait a day.’ I had about a minute to decide.”
So she parsed Fritz Beebe’s words and his lukewarm tone when he said that he guessed he wouldn’t and concluded that he would back her if she chose a different course.
“I said, ‘Go ahead, go ahead, go ahead. Let’s go. Let’s publish.’ And I hung up.”22
In that moment the woman who reached for the advice of others on every decision realized that only she could choose; when forced to reach inside to form her own opinion, she found that she did know what to do.
Before the afternoon was out, the government filed suit against the Post. The following day, June 21, Judge Gerhard Gesell ruled in the newspaper’s favor. Less than two weeks later, the Supreme Court upheld him, saying the government had not met “the heavy burden” required to justify, on the grounds of national security, restraining publication.
With the Pentagon Papers, the Post transcended its status as a decently run business that produced good local journalism and began its transformation into a great paper of national importance.
“Her skill,” wrote reporter Bob Woodward, “was to raise the bar, gently but relentlessly.”23