Donald Regan (born 1918) directed America's leading brokerage house (Merrill, Lynch, Pierce, Fenner, and Smith) to new heights of success in the 1970s, before serving consecutively as secretary of the treasury and White House chief of staff under President Ronald Reagan.
Born in Cambridge, Massachusetts, on December 21, 1918, Donald Thomas Regan attended Cambridge Latin School and Harvard University, graduating from the latter with a B.A. in English in 1940. While a student he ran a local guide service which netted him, in addition to his college expenses, savings of $2,000 by the time he graduated. Abandoning law school after less than a year, he enlisted in the Marine Corps and during World War II he served in five major campaigns, including Guadalcanal and Okinawa. After rising to the rank of lieutenant colonel, Regan left the corps in 1946; he subsequently credited his experience in the Marines for teaching him a sense of organization. In 1942 he married Ann Gordon; the couple had four children: Donna, Donald, Richard, and Diane.
In 1946 Regan was determined to join a corporation with an effective training program; narrowing his choices to two, he chose the nation's leading brokerage house, Merrill, Lynch, Pierce, Fenner, and Smith, Inc. He would spend his entire professional career at Merrill Lynch until entering the government 35 years later. Regan served for two years as a broker in the Washington office of Merrill Lynch, after which he was transferred to the New York office, where he was made manager of the over-the-counter department in 1952. Two years later he became a partner in the firm—at 35, the youngest in Merrill Lynch's history.
Regan's rise in the company continued at a rapid rate. From 1955 to 1960 he managed the Philadelphia office, then returned to New York in 1960. He served successively as director of the administrative division (1960-1964), executive vice president (1964-1968), president (1968-1971), and board chairman and chief executive officer (1971-1980).
During his years at the helm, Merrill Lynch diversified its services in a revolutionary way, entering into a wide range of financial services including money market funds, issuance of credit cards, and provision for check-writing by investors. Under Regan's leadership, the firm—which had originated the "chain-store" concept among brokerage houses—became a "supermarket" for financial services. Regan's performance in these years earned him a reputation as a corporate "maverick," a term he always rejected. (Mavericks, he contended, wander away from the herd, while it was always his purpose to lead.)
His leadership was profitable for the corporation and for himself. Merrill Lynch's annual revenues increased sixfold in the 1970s, while Regan amassed a personal fortune consisting of over 240,000 shares of the company's stock (estimated to be worth $8.5 million) by 1979.
Despite his prominence and formal membership in organizations of the nation's leading business executives (such as the Committee for Economic Development, the Council on Foreign Relations, and the Business Roundtable), Regan kept a low profile in national politics. Although a member of the influential 44-member Policy Committee of the Business Roundtable from 1978 on, his views on specific policy issues remained something of a mystery to the public. Even as a chief executive officer, Regan guarded his time and his privacy, earning a reputation as an "eight-to-five" executive and retreating with his wife to their colonial home in Mount Vernon, Virginia, for weekends.
When President-elect Ronald Reagan selected Regan to be secretary of the treasury in December 1980, press reaction was generally favorable but reserved. His reputation as a staunch supporter of the free market appealed to the financial community; yet many conservatives feared he would not give high priority to the tax reductions mandated by "supply-side" economic theory. As treasury secretary, however, Regan proved to be an effective advocate for tax reform, playing a key role in securing congressional passage of a three-year tax cut in August 1981. Recognized quickly as an effective agency head, Regan did not emerge immediately as the administration's chief economic spokesman. By 1982, however, he assumed that role, eclipsing the heads of the Office of Management and Budget and the Council of Economic Advisers.
Though Regan frequently offered blunt public comments suggesting internal disagreements in the administration (for example, blaming Federal Reserve Board policies for high interest rates and suggesting the need for tax increases in 1982 and 1984), his influence with Reagan rose steadily, culminating in his appointment as White House chief of staff (in an exchange of positions with James A. Baker, III) in early 1985. This appointment—and Regan's prominence, generally, in the Reagan White House— symbolized the power of non-economists in an administration which was almost certain to be remembered for its leadership in directions of economic change. True to his background as a Wall Street innovator, Donald Regan was positioned to play a major role in this revolutionary activity in the final four years of the Reagan presidency.
For almost two years of Reagan's second administration, Regan maintained a fairly high profile as a no-nonsense chief of staff. In this role he carried the president's support over those who disagreed on issues and personalities. But when the Iran-contra scandal broke in November 1986 Regan came under attack for not better advising/protecting the president. With the publication of the Tower report on the scandal (named for the committee's chairman John Tower, former senator from Texas) Regan saw his position as chief of staff so weakened that he resigned February 27, 1987. (He was replaced by another former senator, Howard Baker of Tennessee.)
In 1988 Regan published a memoir of his years in the government, For the Record. The book received mixed reviews. Perhaps the most valanced appraisal was given by Morton Kondracke in the New York Times Review of Books (May 20, 1988), who called it "a substantial (if self-serving) memoir of the reagan Presidency and a riveting tale of political downfall and human agony."
No biography of Regan has been produced, nor was there any systematic study of his tenure as secretary of the treasury and White House Chief of Staff apart from his own memoir For the Record (1988). The best sources on his personal history were Fortune (March 23, 1981) and several profiles that appeared when he was named to the Treasury position, including U.S. News & World Report (December 22, 1980) and National Journal (December 20, 1980). His impact on Merrill Lynch was best discussed in Fortune (March 23, 1981). □