PETER B. LEWIS TELLS IT LIKE IT IS

Padding around in black sweat pants and a white T-shirt in his penthouse
apartment in Beachwood early one morning, Peter B. Lewis moves from kitchen
counter to table and back again. Keeping up a steady stream of
conversation, he is absently toasting yet another slice of rye bread and
spreading it sparingly with butter or jam from the jar.

The morning's Plain Dealer and New York Times, already read or thumbed
through, rest on another counter in the no-nonsense gray-and-white kitchen.
The only splash of color is the startling red table, already set for the
two of us.

It is just a few days before the PD will print its shocking front-page
story about Lewis, philanthropist, retired CEO and current chairman of the
board of automobile insurance giant Progressive Corporation. Weeks later,
that story is still a hot topic around dinner tables and at water coolers:

"Billionaire blasts CWRU board, halts charitable gifts across city."

The abrupt cutoff of funds had its origins, ironically, in Lewis' most
generous gift yet to the city of his birth and his business. He has
bankrolled, to the tune of $36 million, the $61.7 million Peter B. Lewis
Building at the Weatherhead School of Management at Case Western Reserve
University. Set to open next month, the dramatic, billowing steel-and brick
building is designed by renowned architect Frank Gehry.

The initial project was not quite that grandiose. Ten years ago, Scott
Cowen, then dean of Weatherhead, along with Lewis' friend and former
Progressive employee Norton Rose, solicited Lewis about a building for the
business school

Eventually Lewis consented, reasoning that his mother had grown up on
Magnolia and Ford Drive, near the proposed site of the building, and both
his parents and his sister attended the university. Moreover, he adds,
"Progressive is the best business in Cleveland. I'm rich, and I'm a
philanthropist."

Initially, Lewis pledged $15 million to the $25 million building that was
to bear his name. When Cowen suggested using Lewis' friend Frank Gehry as
architect, Lewis knew he would have to raise the ante. But he did not
anticipate what followed.

"Scott left, (CWRU President) Pytte left, they brought in a dingbat dean
..." Four deans, four university presidents, and two heads of grounds and
buildings later, project costs soared from $45 million to almost $62
million, "all because of lousy management and people changing jobs," he says.

What Lewis has to say about the corporate lawyer types who serve as
Cleveland's civic leaders and CWRU board members, is unprintable in a
family newspaper.

To show his anger at this ineptness, Lewis took Draconian measures. He has
declined to support any Cleveland institution until CWRU gets its act
together. That means a reduction in the number of CWRU trustees, now at 46,
and the electing of more forward-looking individuals to that board.

Problems with Cleveland's oldest and most prestigious university are not
new. In a 1985 sermon, the late Rabbi Daniel Jeremy Silver of The
Temple-Tifereth Israel (where Lewis is a longtime congregant) noted the
role of the university in contributing toward Cleveland's "diminishing
profile," beginning at the dawn of the 20th century.

In that sermon, later reprinted in the CJN, Silver laments the
"comfortable, conservative and self-satisfied Clevelanders who wanted to
believe that what was (Cleveland's ascendant position in the Steel Age)
would always be." Those who raised questions about such shortsighted
smugness "were politely heard but not listened to."

Now, in the exercise of hope over others' experience, Lewis wants the smug
ones to listen to him.

Meanwhile, however, when Lewis slammed shut his checkbook, one unwitting
loser was the Jewish Community Federation of Cleveland which, based on past
donations, anticipated Lewis' gift in calculating its 2002 goal for the
Campaign for Jewish Needs.

Earlier in the year, Stephen H. Hoffman, CEO of United Jewish Communities,
the umbrella organization for all North American federations, solicited
Lewis for the Israel Emergency Campaign.

"The request I made was very generously answered" with a $500,000 pledge,
says Hoffman, former president of the Jewish Community Federation of
Cleveland. Lewis and his brother, Dan, a resident of Florida, ultimately
gave their combined $1 million pledge to that campaign through the Jewish
federation of Miami.

By the time Lewis was solicited for the Jewish Community Federation of
Cleveland's annual campaign, he had made his dramatic decision to pull the
plug on all charitable gifts here.

Asked to comment about this unexpected shortfall, Federation board chairman
Chuck Ratner is reluctant to criticize a man who, over the years, has been
one of Cleveland's largest individual donors. "Peter Lewis has always been
a wonderful supporter of the Jewish people," he says, carefully measuring
his words. "He only wants what is best for Cleveland."

Hoffman, who served as the Federation's top executive for many years before
assuming the national UJC post, recalls that in addition to being a
generous donor, Lewis brought about "seminal changes" when he served as
chairman of the Federation's investment committee in the mid 1980s.

"He taught us a whole new way of thinking about our investment" policies,
says Hoffman, enabling the Federation to "earn millions more. Overnight we
became more sophisticated and successful." Moreover, he adds, when Lewis
was ready to move on, he named other people who could take over. "He didn't
just cut and run."

While some people have condemned Lewis' latest act as cutting and running
from his philanthropic responsibilities, others privately applaud his gutsy
move. Even Hoffman acknowledges that Lewis has "put his finger" on a key
factor affecting Cleveland's future.

"The bottom line is that Cleveland has very serious challenges, and the
university needs to play a role in helping us work out of it," he says.
"Peter is innovative like crazy (in the business world); now he is
innovating in the nonprofit world."

What makes him tick?

Apart from his latest notoriety as mercurial philanthropist, who is Peter
Lewis and what makes him tick? The answer is as complicated as the man himself.

Lewis describes himself as a risk taker. "Being honest is a risk most
people won't take," he says, pointing to that morning's headlines about
disgraced CEOs and the Enron accounting debacle. "Instead they lie, mislead
or don't say anything." Honesty, he believes, "takes great courage."

He credits his Jewish heritage for playing "a strong role" in his
philosophy of life, the centerpiece of which is "extraordinary openness and
impeccable honesty." Judaism, he adds, also reinforces his conviction that
"life is now, one day at a time ... That's where Jews are pragmatically."

At different times in his life, two rabbis had an important influence on
him. He was always close, he says, to his uncle Albert Lewis, a Reform
rabbi in Culver City, California, and he became close to Daniel Silver
during the last few years of Silver's life.

"Because I'm eccentric, I often have doubts if what I'm doing is right," he
admits. "Dan (Silver) helped me feel OK about thinking differently." He
also views the late rabbi as "an example of dying with dignity."

Death has stalked Lewis' own family. When Lewis was 18, his younger
brother, then 16, died in a car crash. Two years later, his father, who
started Progressive Insurance, died of a brain tumor at age 48. And nine
years ago, his sister, Connie, 54, died of cancer. As he explains it, the
68-year-old Lewis has been patriarch of his family for almost 50 years.

After graduating from Princeton, Lewis began working at Progressive, and at
age 31, following a leveraged buyout of his father's partner, he was named CEO.

"To be CEO of a growing company required the ability to understand that I
didn't know what I was doing," he admits. "I went to work every day not
knowing what I'd find" or what he would do once he found it.

His best idea, he says, came in 1956, when he got calls from insurance
agents who were having trouble placing bad risks (drivers with numerous
violations). "Why are we mad at people wanting to do business?" he asked.
"We should just charge more" and take their business.

A year later, in 1957, Lewis wrote $83,000 in high risk auto insurance. In
2001, Progressive wrote $3 billion in high risk insurance out of $8 billion
overall.

"Mostly the stuff I learned has been by trial and error," he says. "I go by
my gut and I am comfortable saying I made mistakes in the process of
getting where I am."

John Garson, one of Lewis' oldest friends, who served on the board of
Progressive for 10 years, believes Lewis' greatest attribute as a
businessman is that he's "a visionary ... and unlike most CEOs was able to
translate that vision into action. He also hired people who were very smart
and he was not intimidated by that."

Lewis, by contrast, is less complimentary to his contemporaries and
sometime friends. "Many of them pulled the roof over their heads by the
time they were 40" and didn't grow anymore, he claims.

What most people would describe as adversity or just bad luck, Lewis
credits as learning and growing experiences. Like divorce, for example, or
losing a limb.

Since his divorce 25 years ago, he says he and his ex-wife, Toby, "have
both grown." She is the curator of Progressive's extensive art collection,
and the former picture postcard-perfect couple of years past remain good
friends. Within days of our interview, for example, Toby and two of their
three grown children, Jonathan and Adam, were to join Lewis on his
ocean-going tug in the Baltic Sea, off St. Petersburg, Russia. Daughter Ivy
remained in Aspen where she home schools her three children. All five
Lewises have homes in Aspen where they frequently gather for family
occasions, as they recently did for the bat mitzvah of Ivy's daughter.

While Lewis says he wastes little time looking back at "what was," he does
make one important exception. A few years ago "I lost a leg because I
didn't pay attention (for a long time) to a sore foot," he says. But even
that, he argues now, was a growing experience.

Because of his numerous hospitalizations and surgeries, Lewis knew he could
no longer function as a hands-on, harddriving CEO. That forced him to quit
work which, he admits, "was my very being."

In retrospect, Lewis believes that had he not gotten sick and simply
continued working, "I'd have drifted into incompetence." Now, he's
perfectly happy serving as "a cheerleader," symbolically and emotionally,
for the company that once employed 100 people and now issues paychecks to
more than 20,000 - some 8,000 of whom live and work in Cleveland.

Although he is retired, Lewis is far from idle. He is chairman of the board
of the Solomon R. Guggenheim Foundation in New York City (where he donated
$50 million and has committed to an additional matching pledge of $250
million), and he just completed his tenure on the board of Princeton
University, where has donated $115 million to date.

He also works out with a trainer two hours a day, the fruits of which are a
lean body and movement so natural that the casual observer cannot tell that
he has an artificial leg.

Then there is "The Lone Ranger," his aptly-named ocean-going tugboat where
Lewis, pampered by a crew of 18, spent 163 nights last year. While he is
often surrounded by people, he admits to basically being a loner. Although
he names some old friends and newer ones like architect Frank Gehry and
U.S. Sen. Bob Kerry, Lewis confesses he does not have any really close
buddies anymore.

His closest friend, arguably, was Paul Sigler, his college roommate and
best man at his wedding. Sigler, a physician who went on to become
professor of molecular biology at Yale, died suddenly in 2000. That same
year, Lewis gave Princeton $55 million, part of which established the
Lewis-Sigler Institute for Integrative Genomics.

Lewis' great wealth, estimated at $1.4 billion, is also an isolating
factor. "It's rare I get a phone call from someone who doesn't want
something from me," he says. "I get 8 to 10 letters or phone calls a month
from people I never even heard of who ask for money."

But the main cause of his isolation, he says, is his "life of hedonistic,
sybaritic, self-indulgence."

The chairman of the board of Progressive didn't always live the life of the
rich and famous. He and Toby raised their three children in a relatively
modest home on Fernway Road in Shaker Heights. He wasn't a loner then, as
much as he was a striver.

Garson recalls that he was always very "intense" both in his business and
his personal life. When he decided to learn to play squash, "he did it
every day until he got good at it. He was that way with tennis, too." When
the two played on the same softball team while in their 20s, Lewis wasn't a
great player, Garson recalls, "but his sheer will and determination carried
him forward."

Lewis the philanthropist

While Lewis is one of the most generous as well as one of the most
idiosyncratic philanthropists in America today, it's not a role he
particularly relishes. Most philanthropists, he claims, don't enjoy doing
philanthropy, but giving to charity, he insists, "is better than giving to
the government." He's also cynical about the recipients of his largesse:
"They AK me until I write the check."

Not every check Lewis writes carries with it a high profile. One of the
lesser known of his beneficiaries is the Julie Billiart School for severely
handicapped children, located in Lyndhurst. Lewis owns property adjacent to
the school and at one point planned to build a Frank Gehry-designed home
there. Billiart principal Sister Agnes Marie, together with a few other
school supporters, approached Lewis several years ago for help in starting
a much-needed development program for the non-sectarian, 115-student school.

"We went to Peter as a good neighbor," says Sister Agnes Marie. "We didn't
know him and he didn't know us." Nonetheless, Lewis gave the school the
first (and largest) challenge grant it ever had, for $100,000, followed by
several other matching grants. That enabled the school to make major
capital repairs and have a small reserve. It also "stretched us to go
outside of our community," adds Sister Agnes Marie gratefully.

The involvement didn't stop there. While the school was working on meeting
its challenge grant, Lewis visited classrooms and met some of the children.
For his 65th birthday, Sister Agnes Marie recalls, he invited the children
to visit his corporate headquarters and tour his art collection.

Lewis maintains that "the single most gratifying gift" he ever gave was to
the Peter B. Lewis Aquatic and Therapy Center at Menorah Park Center for
Senior Living in Beachwood.

The genesis of that gift is indicative of how Lewis handles much of his
philanthropy. Noticing that Lewis swam every day at The Cleveland Racquet
Club, then-Menorah Park board president Ed Singer approached him about
contributing toward the proposed new $2.5 million aquatic center at Menorah.

"I said I would give it all, but on three conditions," recounts Lewis.
"Don't solicit me for Menorah again; my name is on the wall, and I can use
the pool any time.

"'You got it,' Ed said, and I wrote him a check." No extensive research. No
long hours of soul-searching. No consultation with philanthropy advisors.
Just an on-the-spot, intuitive response, reinforced by a liking for the
person doing the asking.

While Lewis has yet to use the pool himself, the gratification, he says, is
the "good feedback" he receives from the people who do use it.

Claiming "no interest in managing my posterity," Lewis says his two
proudest legacies are Progressive and his three children. As his
contribution to society, he adds, he would like to get marijuana legalized.
Toward that end, he has given the American Civil Liberties Union $7
million, much of that targeted for the legalization effort. There is "no
logic," he says to making possession of marijuana illegal.

Lewis speaks from painful experience. While on the way to visit his
daughter and her family at their second home in New Zealand, Lewis was
arrested for possession of marijuana and forced to leave the country. Even
that, he muses in retrospect, was a learning experience. "I decided I was
getting arrogant and needed comeuppance."