The Education of an American Dreamer

How a Son of Greek Immigrants Learned His Way from a Nebraska Diner to Washington, Wall Street, and Beyond


By Peter G. Peterson

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With insight and refreshing candor, Peter G. Peterson describes his remarkable life story beginning in Kearney, Nebraska as an eight-year-old manning the cash register at his father’s Greek diner through his “Mad Men” advertising days, to Secretary of Commerce in Nixon’s paranoid White House, to the tumultuous days of Lehman Brothers, and to the creation of The Blackstone Group, one of the great financial enterprises in recent times.

In The Education of the American Dreamer, Peterson chronicles the progress of this journey with irony, humor and, sometimes, painful honesty. Within these pages are stories of marriage and family hardship; lessons in political gamesmanship; thoughts on his obsessive desire to succeed; and, finally, learning the meaning of “enough.” From his advertising days in Chicago in the 1950’s to becoming the youngest CEO of a Fortune 300 Company, he shares with us his rise to the top and the price paid along the way. As the youngest Cabinet member in the Nixon administration, he describes his survival techniques in a hubris-driven and paranoid White House, including his turbulent turf wars with Treasury Secretary John Connally leading to Peterson’s abrupt and highly publicized firing. His stewardship of Lehman Brothers is a Shakespearian tale of a CEO who struggled to deal with partners who were plotting his demise and, at the same time, turning an institution on the brink of bankruptcy to one with 5 straight years of record profits.

His life’s story is about doing well by doing good. In the wake of Blackstone’s highly successful public offering, Peterson found himself an 80-year old instant billionaire, on the verge of retirement. And like many lifetime workers and over-achievers, he suddenly confronts an unexpected, depressing identity crisis. His solution? Committing a great bulk of his net proceeds to establish the Peter G. Peterson Foundation, his philanthropic endeavor to do something about America’s politically untouchable challenges that threaten America’s future, among them massive entitlement obligations, ballooning health care costs, and our energy gluttony.

Ultimately, this is a man’s account of his legendary successes, humiliating failures, and personal tragedies – a testament to a remarkable life and, indeed, to the American Dream itself.


Copyright © 2009 by Peter Peterson

All rights reserved. Except as permitted under the U.S. Copyright Act of 1976, no part of this publication may be reproduced, distributed, or transmitted in any form or by any means, or stored in a database or retrieval system, without the prior written permission of the publisher.


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First eBook Edition: June 2009

ISBN: 978-0-446-56182-2

Dedicated with love, admiration,

and gratitude to my parents,

Georgios Petropoulos and Venetia Papapavlou,

who became George and Venet Peterson



Beacon in the Night

Kearney, Nebraska, where I grew up in the 1930s, was a good-sized town by the standards of the plains. It was large enough for people to want to eat at all hours of the day and night, and the Central Cafe, my father's restaurant, was there for them. It was half a block from the Union Pacific railway station, its neon sign blinking through the night beckoning the train crews rotating off their shifts and the passengers who had arrived, for whatever reason they had come, at the absolute midpoint of the United States. Kearney was halfway between Boston and San Francisco, 1,733 miles from each, as attested by the plaque near the swimming pool at the 1733 Park where I played as a boy.

My father had worked for the railroad. He took a job no one else wanted, washing dishes in the steamy caboose that served as living quarters to a crew of laborers laying track in western Nebraska. From washing dishes he learned to cook, which he much preferred to driving railroad spikes and hauling rails and ties. But the track crews couldn't work through the Nebraska winter, so when the crew crossed paths with a traveling circus looking for someone to feed its collection of roustabouts, aerialists, and animal tamers, my father took off with the circus. This was sometime around 1917, five years after he arrived at America's golden shore from Greece, a boy of seventeen who spoke no English and had a third grade education.

Other cooking jobs followed, and he learned more about the restaurant business. He learned to speak English. His employers often gave him room and board, which allowed him to save much of what he earned. Finally, his experience and his savings reached the point where he was ready to start out on his own. He bought and quickly sold restaurants in Lexington, Nebraska, and in Iowa before settling on Kearney, a town with growth potential and not much competition. It had a college that he envisioned as a source of cheap, smart labor, a handful of Greek families that would make him feel at home, and a vacant lot downtown near the railway station. He bought it and built the Central Cafe, whose sign was a beacon not only to the travelers who passed through Kearney but to its townspeople as well.

"Home of Fine Foods Since 1923," read that sign in inexhaustible neon. That was the year my father opened the cafe. It stayed open twenty-four hours a day, and for twenty-five years it would literally never close. He married my mother a year later. Two years after that I came into the world, and by 1934, when I was eight, I was counting out change to my father's customers.

My biggest challenge as a boy was trying to fit in. But fitting in was really tough, because I wanted to be 100 percent American while my parents clung to their Greek customs. They pulled furiously one way, I the other. All children struggle to escape their parents so they can define themselves, but mine had roots deep in another world.

George and Venetia

My father was George Peterson, which was not the name he was born with. That was Georgios Petropoulos, the surname literally translating into "Peter's son," and often over the years he told me he deeply regretted changing it. "I wouldn't want anyone to think I wasn't proud of our race," he said. In the scheme of things, however, he kept the more important thing he brought from the Old Country, his bedrock values.

He was from a town called Vahlia, in the mountains of the Peloponnesian Peninsula in southern Greece. It was a poor town, and his family was among the poorest. His father, Peter, for whom I am named, according to the family lore preferred sleeping under an apple tree to working and would move only to find a new patch of shade when the shifting sunlight hit his eyes and woke him up. His indolence did nothing to diminish the imperial tendencies of his wife, my grandmother Nicoletta, who upon meeting new people would offer her hand to be kissed. They tried to keep a garden, but rainfall was sparse and water had to be carried in buckets from a nearby stream. They kept chickens, which provided eggs, and goats, which provided milk, and when a new baby was born in the family, a goat was slaughtered over the protests of the children, who had made pets of the animals. My father had six brothers and a sister, and they all slept on straw mattresses crowded together on the floor of the family's two-room house or, if the weather was good, outside in the yard. Regardless of the season, none of them wore shoes. The shoes their parents wore were fashioned from discarded tires. They told time by the sun since they could not afford a clock, and on cloudy days relied on guesswork.

School was an afterthought. Girls could expect six years of education. Boys might reach higher, but only if they paid a price. They would have to leave home at the beginning of each week, walk thirty miles to a larger village that had a more advanced school, and live in a hostel with other boys until the weekend when they could walk home again. This was not my father's lot. For his older brothers who went off to school, my grandmother would bake a loaf of bread and score it with a knife five times, to let them know how much—or little—they could eat each day with slices from the block of cheese she gave them from her homemade stores. At some point, they started dreaming of America.

My father's older brother Nick was the first to make the passage. By 1912, he had a job at a meatpacking plant in Milwaukee and could send money for my father's ticket. The Titanic sank that year, but my father's trip was uneventful in his fetid quarters deep in the ship's bowels where he longed to breathe fresh air. He entered America through Ellis Island and headed to Milwaukee to meet up with Nick as soon as he cleared the immigration hurdles. His first job, at a fruit stand, fell through because he could not understand the customers; if asked for "a couple of apples," he would heave a sackful on the counter. Soon, however, Nick got him a job at the meatpacking plant. It was the starting job from hell, feeding cattle hooves and horns into grinding machines to be processed into fertilizer, the kind of job that to this day immigrants are willing to do because their foothold in America is that precious. Choking dust rose from the machines; the men fed them with one hand and clamped damp rags over their noses with the other, which was murder on their arms and shoulders. My father almost gave up and headed home. But he stuck it out and moved up to cutting meat, learning the fine points of reducing cattle and hogs to roasts and chops with very little waste. When he moved on to the railroad job, he changed his name to Peterson, as Nick had done before him. If he was sorry for it later, he could blame the Union Pacific timekeepers who claimed they could never understand him when he said Petropoulos. And as he grew into his twenties and cooked for railroad laborers and circus folk and saved money and set his sights on building the cafe, he waited for someone to marry.

My mother, Venetia Papapavlou, lived in Niata, in southern Greece southeast of Sparta. The Papapavlous had prospered by comparison with the Petropoulos clan. Yanni Papapavlou—or Big John, as her father was known—had land and a big house. Like everyone else in the village, he had no electricity or running water. Rain supplied drinking water that was stored in big clay pots called amphorae, and there was a cistern that provided water for the garden so that no one had to haul water from a stream.

Olive, almond, fig, orange, and lemon groves, wheat fields, and vineyards dotted the landscape beyond the house. Only the olive groves qualified as a commercial operation. Big John had an olive press and used the proceeds from the oil to purchase more olive groves. He paid his workers with the very crops they harvested; the olive pickers were paid one bushel of olives for every four they picked, which he would then press into oil for them. The men who picked grapes and stamped them to make wine kept much of it for themselves and sold the rest.

My mother remembered an abundance of food prepared by her mother, Demitroula. Hungry neighbors always knew they would be fed, and her father's generosity extended to the local schoolhouse, where he would hand out small cloth bags filled with a mixture of sun-dried raisins, fruit, and almonds. On weekends this became the stuff of barter and a social life, with Big John hitching up his horses, piling his children—known collectively as Little Big Johns—into the wagon, and driving to town to trade the bags of fruits and nuts for other goods. If there were any bags left, he would give them away rather than carry them back home.

John and Demitroula had an easy, bantering relationship. His was the only horse-drawn wagon in Niata, and he always insisted that she ride in the front seat with him as he drove, a rare display of gender equality in that place and time. But he also warned her, laughingly, that if she got too big for her britches he would assign her to "live spotter" duty in front of the horses, a reference to the dangerous job of locating the land mines that littered the countryside after Greece's past wars. Of course he never did carry out his threat.

His generosity was deep. He had an old neighbor, Stavros, who depended on his donkey, called Kitso, or "helper," to gather wild berries and tsai, the Greek mountain tea also called shepherd's tea. Stavros sold some of what he had gathered for a few pennies or traded it. Returning from church one Sunday with three of his children, Big John heard a commotion as they were passing Stavros's small house. Stopping to inquire, he found Stavros berating his donkey, which had died. "Look what Kitso did to me," Stavros cried. "How could she do this to me?"

Big John agreed that Kitso was a thoughtless beast but joked that she had never done such a thing before. Stavros, not amused, ordered him off his property forever. John hustled away, bought another donkey, and returned the next day to present it as a gift from all the Papapavlou children. They were there as their father knocked on the old man's door and they saw how, still furious, he again ordered Big John off his property. Sadly, Big John explained that his children would have to give the donkey to someone else. The old man was moved to take a look at the animal and then received it with gratitude, gushing with prayers that Big John would live a long and healthy life.

"You had better pray for an even longer and healthier life for your new Kitso," said Big John.

Life in Niata had changed. The young men began to leave for better jobs. Without them Big John could not cultivate his groves, and young women like mother had fewer chances of marrying. So the day came when Big John accepted that three of his children had little choice but to emigrate and join other members of the family already in America. On a mid-September day in 1920, eight years after my father had arrived in America, my mother, Venetia, her sister Patra and brother Demetrios (James), with his new wife Adamandia, boarded a ship called the Megali Hellas in Piraeus bound for New York. They had nineteen days of hell, with passengers falling sick all the way before they steamed past the Statue of Liberty and docked at Ellis Island on October 4, 1920. My mother, like my father, was seventeen when she first set foot in America.

And like him, she traveled halfway across the continent. With the small group of immigrant Greeks, she boarded a train for Fremont, Nebraska, west of Omaha. It was all mapped out. She was to work as a housekeeper for her Uncle John and Aunt Vasso Petrow and nanny to their three children. John was an entrepreneur who owned a restaurant and a J. C. Penney store in Fremont. It was he who had sent the money for her passage.

Venetia quickly learned that she would pay a price for her journey to America. She cleaned house and cared for John and Vasso's children and toiled in his restaurant, too. There was no letup and she, like my father, dreamed of what now seemed like a golden past in Greece. But to return home would have been disloyal, and she forced herself to look ahead. After three and a half years, when she turned twenty-one, Uncle John decided it was time for his ward to marry. This could not have come as bad news to my mother.

The Nebraska Greek community was small and highly interwoven, and John knew where to find likely candidates for marriage to a beautiful and highly eligible young woman. One was my father, whose reputation for making a success of the Central Cafe had spread the 160 miles that separated Kearney from Fremont.

Three bachelors called simultaneously at John Petrow's house that day in late May 1924. One, to hear my mother tell it, was a version of Washington Irving's Ichabod Crane, gawky and tall, all limbs and knees and elbows. The second apparently was not memorable enough to recall. The third was my father, smelling of Aqua Velva aftershave, his jet-black hair combed straight back from his forehead and shining with a dose of Lucky Tiger hair tonic. As the bachelors sat in the Petrow living room, no doubt appraising one another, my mother served them water and fruit drinks and thus had a chance to imagine what might lie ahead.

"Which one do you want?" her uncle asked when she returned to the kitchen with the empty tray.

She and my father were married forty days later.

The Peterson Family Begins

They were married twice, as it turned out. The first time, on July 6, they exchanged vows in the Fremont chambers of a Dodge County judge named Wintersteen. This was legal and official, but it lacked the over-arching authority of the Greek church. The church ceremony came a few days later, when the one Greek Orthodox priest for Nebraska and parts of Iowa had a break in his schedule and came out from Omaha. Uncle John Petrow had assembled his Greek friends and relatives in a roped-off section of the J. C. Penney store before it opened. Uncle John gave Venetia away, and a cousin of my father's stood up as his best man. My parents dressed for this one, my father in a rented tuxedo, my mother in a white dress and a fantastic hat made from layers of chiffon. She carried an equally fantastic spray of flowers. By all accounts the occasion was a joyous one, but the formality of the official wedding portraits seems to have overwhelmed them. Neither looks happy. They stare at the camera with grave, almost grim expressions, in my mother's case perhaps because the Greek Orthodox ceremony places the wife secondary to the husband, who is "head of his wife" in a marriage. Afterward, everyone rode out to the Petrow farm for the wedding lunch.

I imagine those early days were hard. They were two people whose only certain points of common interest were that they were Greek and had to struggle to survive. My father, the child of poverty, ascetic and hardworking; my mother, warmer and spontaneous—in a perfect world each would have complemented the other and compensated for what the other lacked. But the depth of their divisions came to light at once.

They honeymooned in Colorado. This was not a romantic choice, but a family obligation. My father's closest maternal relative in the United States, his mother's sister, lived in Colorado Springs and he wanted to show his new bride to his aunt. My mother had the idea that her honeymoon was worth recording, so she got her hands on a Brownie camera and took some photographs. Somehow this escaped my father's notice.

Back in Kearney, they set up housekeeping. My mother had the film developed and one day, when they were walking the seven blocks from the Central Cafe to their house—the family budget did not permit a car—she brought out the photographs to show my father. She must have been shocked at his reaction.

He erupted in fury, raging at her "gall" and "disrespect" for taking and developing photographs without his knowledge and consent. It was an act of disobedience, and furthermore, an unapproved expense. No bride of his could walk with her husband after committing such an act. He ordered her across the street to walk on the opposite sidewalk the rest of the way home.

What to make of this? It was not in my mother's nature or her cultural background to complain about her marriage, but it was she and not my father who told me this story many years after it had occurred. In fact, she waited until he died to tell me, although I had long since concluded that she had much more to complain about. After my father's death, her manner was completely different from the one I had known much of my life. As a widow, she found a joy I hadn't seen. She spoke with a voice that was happy and light. Cousins who had known her as a girl in Greece said she was that girl again. She was finally free of the yoke of the imperious patriarch, my father.

She always was a loving mother. That was clear to me from my earliest moments. She could anticipate my needs, which spoiled me and caused problems later in my life when others—business colleagues as well as romantic partners—could not do the same. Her doting gave me a punch line when Jewish colleagues told me stories about the fussy attentions of their mothers and their maternal pride. I'd listen to them all and say, when they were finished, "Greek mothers make Jewish mothers look criminally negligent."

The world began to open up to me when I was about three. By then I had already been to Greece with my parents on a visit to their home villages, but I was only two and don't remember the trip. One of my first memories is of attending a movie with my mother. It was Al Jolson's The Singing Fool, the tale of a singer who broke the hearts of those early talking-picture audiences as he sang "Sonny Boy" to his dying son. I remember jumping up in the dark theater and shouting, "I am the Sonny Boy!" My mother shrugged off the stares and laughed and hugged me.

Soon after that, in 1929, my sister, Elaine, was born. I think this fulfilled my mother in some way that I or any son could not. My mother felt born again. Elaine would achieve the life my mother had imagined for herself. The year after Elaine was born, we were happy.

The following summer, my parents drove away—we were now the owners of a Model T Ford—to spend a weekend with the Petrows in Fremont. They had two things to celebrate—the Fourth of July and their sixth wedding anniversary two days later. They left Elaine and me in the care of one of Kearney's eight Greek families, but before the weekend was over Elaine developed a frightening, barking cough. A phone call brought my parents rushing home, but it was too late. She died at age one on their anniversary, July 6, of croup. Croup is a child's disease, a normally mild viral infection that restricts the upper airways. The worst cases occur not in the summer but in the winter and the early spring, and even in those cases it is rarely life-threatening. But this time the stars were cruelly misaligned. That Elaine died was bad enough. That her death occurred on the anniversary of a marriage that was tense at best can only have added to the pain. My father was a stoic. Of my two parents, my mother seemed to suffer far more.

A deep gloom descended over my mother and she could not escape it. Pregnant at the time of Elaine's death, two months later she went into early labor, two months premature. She called my father at the cafe to say she was having rapid contractions and needed to go to the hospital. He told her he was baking pies and couldn't leave, and sent someone else to take her. My brother, John, was born into her sadness.

And pretty baby though he was, he could not lift her spirits. Nor could I, as eager as I was to see her smile and feel her warmth again. But her life was as barren as the Nebraska winter that followed the summer of Elaine's death. "Just push me into the grave with my beloved Elaine," I heard her say once to my father. She couldn't even bear to hold my brother when he was a baby, something my brother never got over.

I had felt special, doted on, warm, secure, and all of that vanished. After Elaine's death, my mother was a different woman, cold, detached, and strange. I tried to be perfect and loving in order to please her: There we are, the two of us, in the kitchen of our house. I am standing over the register in the corner trying to catch the heat rising from the coal furnace in the basement, but my father keeps the heat low to save money and I am never warm enough, so I shiver, hug myself, hop from foot to foot. It's a little dance I do for her, hoping she will notice. She sits across the room at the table, with a heavy shawl around her shoulders, her fingers twisting the fringes at the ends, staring at nothing. Sometimes she hums, over and over, a sad tune that must have been a Greek lament. But more often she sits in utter silence. That is the worst. The silence is a clammy hand, and I try to drive it away with Mommy this, Mommy that, Mommy, Mommy, Mommy. And she responds with more silence. That is why, today, I fill a pause with words, too many, some would say. In my experience, silence is a pall.

Freudian psychologists tell us that a child's separation from the mother, when the child suddenly realizes he or she is no longer the center of the solar system, is nearly always painful. When the separation takes place at a very young age, suddenly and in the midst of tragedy or trauma, it is especially painful. As indeed I learned.

Thus, the year went by. My father, deprived of his helpmate at the restaurant, decided to try anything to get her back. This led him to bring her to the Mayo Clinic in Rochester, Minnesota, which by the early 1930s was already a major medical institution serving a wide range of conditions both physical and mental. My mother stayed there for two or three weeks, and returned with a diagnosis of "nervousness." How language changes. What was once called "melancholia" evolved into "neurasthenia," then "nervousness," and then the dire-sounding "nervous breakdown." Today she would have "clinical depression," the debilitating state memorably described by novelist William Styron as "darkness visible." The cure prescribed, in those days before effective and tolerable psychotropic drugs, was rest and counseling. She got the rest, but not the counseling.

Enter Mrs. Boulos. That Kearney, Nebraska, could be so filled with immigrants strikes me as remarkable only in retrospect. Our little neighborhood seven blocks from downtown included not only Greeks but a poor Lebanese Catholic woman. Her kitchen was always fragrant with the smell of fresh-baked pita bread. She offered a lifeline of escape from the lonely quiet imposed by our mother's need to rest and withdraw. As soon as my brother, John, was big enough to toddle, I would take him by the hand first thing on weekday mornings and lead him through backyards to Mrs. Boulos's kitchen door. Barreling into her warm kitchen, we left behind our distracted mother and received instead the indulgence of an older woman whose own children were grown. She must have liked having children around, because she fussed and served us piping hot rounds of pita bread and tousled our hair as we sat at her kitchen table with our toys.

If my own mother ever resented this turn to a substitute, I never knew it. She was probably relieved that we left her to her rest, and neither she nor my father ever worried, because the Bouloses were friends as well as neighbors. As John got older and more athletic, he tried to outrun me to Mrs. Boulos's door, but it didn't matter who got there first since she was equally warm and giving to us both.


My father played a small part in this equation. As my awareness grew, he was a distracted and elusive figure who appeared mainly late at night. Sometimes, if I was up early on a weekday, around six or so, I could see him leave for work. He would rush into the kitchen fresh from shaving, his cheeks aglow, combed-back hair still neat and glistening, wearing the uniform in which he presided over the Central Cafe—dark pants and a white shirt, a tie that he stuck between the buttons of the shirt to protect from stains, black shoes, and white socks, the socks white on the theory that white was better for the feet because it retained less heat and moisture. Then he was gone. There were no hugs, kisses, or conversation, only the kitchen door banging in his wake.


On Sale
Jun 8, 2009
Page Count
384 pages

Peter G. Peterson

About the Author

Peter G. Peterson lives in New York City with his wife Joan Ganz Cooney, founder of the Children’s Television Workshop, and has five children and nine grandchildren. His most recent book, Running On Empty, was a national bestseller. He is the Chairman Emeritus of the Council on Foreign Relations and founding Chairman of the Peterson Institute for International Economics. He is also founding President of The Concord Coalition.

Learn more about this author