July 28 (Bloomberg) -- New York State Attorney General Eliot Spitzer lost a childhood game of Monopoly after selling a property because his father ordered him to. The experience ``convinced Eliot never to defer to authority,'' says dad.

Spitzer's crusade to reset the moral compass of U.S. capitalism in the face of hostility from the rich, the powerful and even his fellow regulators is documented by Brooke Masters in ``Spoiling for a Fight: The Rise of Eliot Spitzer.''

The author does a superb job of unifying Spitzer's high- profile assaults on wrongdoing with his underlying philosophy of how government and business should interact. With Spitzer seeking the Democratic nomination for New York governor in September, it's a timely analysis, packed with insights that only come from one-on-one interviews and diligent, thoughtful reporting.

Masters identifies common themes running through Spitzer's campaigns against abuses including insurance-industry kickbacks, biased investment-bank research and radio-station payola. She even finds justification for his mastery of ``the accusatory press conference and the selective leak'' as tactics to bring wrongdoers to justice.

Spitzer ``believed that government had a duty to even the balance of power between individuals and corporations and to make sure that capitalism worked as well for small investors, workers and consumers as it did for business executives and big investors,'' Masters writes.

``How could we live in a society where we have so many smart people at the tops of these institutions and things have gone so terribly wrong?'' she cites Spitzer as saying. ``Have we forgotten our ethics?''

Public Profile

After failing at his first attempt to become New York attorney general in 1994, Spitzer worked on ``raising his public profile, making dozens of appearances on television news and talk shows as a legal pundit on everything from the O.J. Simpson case to Monica Lewinsky,'' Masters writes.

In 1998 he outspent the Republican incumbent Dennis Vacco by $9.7 million to $6.6 million, triumphing after a recount that lasted six weeks. He found himself heading an office with a $152 million budget and 1,775 staff members, including 538 lawyers -- and a regulatory vacuum that needed filling.

The book unravels many of the mysteries of Spitzer. Why was his office so willing to risk turf wars with other regulators? ``Regulatory folks had been cowed,'' Spitzer said ``They were afraid to stand up and say `that is wrong.''' He accused the Securities and Exchange Commission, for example, of being ``thoroughly asleep at the switch.''

Sunlight Disinfectant

Why was Spitzer so quick to publicize his findings? Because his overriding concern was ``structural impact, where there is an underlying practice that needs to be reformed. The only way to do that is to lay out the evidence.'' If that meant leaking details to the press, so be it.

Because his office has no power to issue rules, ``we are only left with the option of sort of crafting changes in the form of injunctive relief in the form of settlements,'' Spitzer said. Reaching quick settlements was a way of forcing insurance companies or investment banks to change how they did business.

And why is the attorney general so savage in pursuit of his two most high-profile victims, American International Group Inc.'s Hank Greenberg, and Richard Grasso, the former New York Stock Exchange chairman? Because neither admits to any transgression. ``I will not settle unless there is a CEO on the other side who shares an understanding that this is wrong.''

Quick Successes

By piling up evidence before tackling wrongdoers and exploiting economic vulnerability, Spitzer was able to notch quick successes. ``You have to settle in these cases,'' said John Catsimatidis, chairman of Gristede's Foods Inc., which paid $3.25 million to settle accusations it underpaid delivery workers. ``Nobody wants to go through a full-blown trial. The trial costs as much in legal fees, and there's a chance you could lose.''

Masters averts the risk of hagiography by giving ample airtime to Spitzer's detractors, including Ex-SEC Chairman Harvey Pitt, a slew of lawyers for Spitzer's victims, and billionaire Kenneth Langone, the former head of the NYSE's compensation committee, who this week failed to persuade a judge to dismiss Spitzer's lawsuit about Langone's role in approving $80 million of pay to Grasso.

Spitzer's critics accuse him of ``too much emphasis on cooperation and self-incrimination,'' Masters writes. ``Spitzer's focus on public shaming and his wont for making threats, in this view, enhanced his image as the `Sheriff of Wall Street' and got results, but it also opened him up to charges of operating like a lynch mob.''

Binary World

Spitzer says he sees ``a binary world, good and bad,'' and that he is more interested in remedy than punishment. ``The notion was, don't fundamentally destroy or injure the company but get rid of its bad behavior,'' he says.

Should he succeed in becoming New York governor -- his $16.3 million campaign fund is five times that of rival Democrat Thomas Suozzi, and 10 times Republican candidate John Faso's -- Spitzer is likely to make the most of having a bigger sandbox to play in. ``A governor has a lot more leverage than I do in the legislative process,'' he says. ``I plan to use it.''

``Spoiling for a Fight: The Rise of Eliot Spitzer'' is published by Times Books (298 pages, $26).

(Mark Gilbert is a Bloomberg News columnist. The opinions expressed are his own.)

To contact the writer of this review: Mark Gilbert in London at magilbert@bloomberg.net.

Last Updated: July 28, 2006 00:01 EDT