Forged in America
I mean to say that not only are we broke but we’re busted. In every way imaginable we have abandoned any sense of principle or decency in pursuit of wealth. We have totally lost the concept of success and morphed it into some grim decadence that sees no salient value in the hard work and passion that once dominated our business acumen. Whether we are talking about badly managed Fortune Companies, patently lifted names, celeb-brats or forgeries, we are still in the grisly grip of greed. And, if forgery and greed aren’t enough to shame our Fortune empires, just remember that GE had a $3.2 billion dollar profit in 2010 and paid no taxes.
And so we have arrived at that time and place where we get to discuss, in considerable depth, those aspects of today’s business and social culture that are impacting this country’s economic position as it relates to business; especially new business. Keep in mind that I will avoid the classic mistake of the many economic gurus who spew impassioned articulations that seem to say “the louder and more aggressively I say this the more likely it is to be true!” I will stick to the facts.
The Patriarchal System
The Patriarchal System for defining the preeminent successful business model dates back to prehistoric times. This structure has been the manner in which we have forged relationships and built America’s most powerful empires. The name comes from the father of the family who would increase his power and wealth by breeding an enormous family - more sons and daughters to make more sons and daughters, who would inherit, trade, make war and plunder more wealth, camels, crops and so forth. But so much of the ancients’ fate relied on two things: fertility and fertility - great crops and great families. Families of the ancients would often spread out over great territories to mitigate the possibility of failing to cultivate and maintain either and both. The ancients were not nomadic simply because they loved to travel; they moved to accommodate crops and flocks. They spread out to cover long distances, hoping to hedge their risks, as we see in the Bible story of Jacob being sent to his Uncle Laban for a wife some 400 miles away. That’s what spreading the risk looks like to the ancients.
In the Book of Judges we see the Israel tribe threatened by Midianite nomads who moved into their fertile valleys when seasons changed to take care of their extraordinary crops and families. They did this because they could. Israel left them uncontested as they stripped their crops and grazing lands. This left them free to travel back to their own lands without having them over-grazed or over-cultivated.
Israel’s favorite son Joseph was sold by his brothers to Midianite nomads who then sold him into slavery in Egypt. A couple of well translated dreams later he is running the show in Egypt.
As the number two man there, he had prepared the country for a severe and protracted drought. His family, stuck in the drought-stricken region of Canaan, was forced to come to him for grain. The fact that he had managed to store the over-abundance of seven years of crops for an entire country left him in control of the only reliable food source in the region. Fortunately for his family, Joseph did not hold a grudge or history may have turned out much different. But, of course, like Fibonacci’s spiral proves, nothing happens by chance. Just because we can’t see the road up ahead doesn’t mean there is no turn. And those who insist there is no road ahead because they can’t see it will turn the wheel at the appropriate moment or drive off the cliff.
Why the pyramid looks so familiar
But enough pontificating - where was I going? Oh yes…The Patriarchal System. The ancients survived by a system of natural growth. Families may have drifted apart in geography but never in loyalties. The understanding for each clan was very clear; the success of my brother is my success. If people stayed in one place…if families didn’t grow and prosper in 2500 B.C., an empire could be made or lost within a few seasons. The story of Abraham and Sarah holds so much truth about our relationship with our Creator, but in that is a look at the power brokering of the Middle East in the third millennium BC. Having a large family meant access to more lands, crops, herds and men with which to ally and make war. As Hagar drifted off into the desert, God’s angel told her not to worry about her son Ishmael. He would prosper, she was told, but in the same breath warned that he would be eternally at war with his brother. His brother Isaac married the beautiful Rebecca and both men came together to mourn their father’s death.
Hagar’s lineage is allegedly rooted in the Muslim faith. We know Isaac had Jacob, later named Israel, and the rest of the story starts in the Book of Exodus. Today, fourteen million Jews sit surrounded by a billion Muslims. If Sarah had only known what kicking Hagar out of the camp would have meant…the choices we make.
As remote and removed as that story seems to us today, it is absolutely relevant to who we are and what has happened to the structure of what all that meant. For us in America, the Patriarchal System is relevant to how we created the dynasties we still celebrate today. Names like Vanderbilt, J.P. Morgan and Winchester resonate with every American entrepreneur as much as Gates and Cuban. For many first generation Americans, the American dream was just that, a way to take your family from abject poverty to exceeding wealth; whether you did it like Astor with real estate, Carnegie in steel, Crocker in rails or Buchanan in tobacco. All made huge fortunes, not only for themselves but for their entire lineage for generations to come. Did you know that 72 families own 95% of all of the Hawaiian Islands? Seems the American dream was a nightmare for indigenous people everywhere we (Caucasians) went.
Thus, the pyramid was born. No, not as a scam but as a process that evolved through an entrepreneurial society that rewarded industrious, hardworking, newly minted Americans whose success was passed along to each new generation. The fathers built the name and future generations were to keep hammering at the goldstone until they had gathered all the fortune there was to mine. Most did…at least for a time. The hard work ethic faded sometime during the rise of the Baby Boomer. Now we seldom see empires changing hands from father to son. Think about Disney or Gates - you don’t see their children running empires of like names.
Understanding where our business model fails is as easy as reading any popular tabloid of the day. Empires were built by guys like Conrad Hilton and James Fisk. No one is going to say these guys were saints. They were not. Much of their empire was not built for them but for their heirs. How sad, huh? What a testament to diluted gene pools. Paris Hilton has as much to do with hotels as Tony Pinto has to do with exploding Fords*. There is nothing in a name. Paris is a forgery and forgeries have been with us and affected us since man figured out he could make money by making something up rather than actually discovering or accomplishing something for himself. Paris Hilton became a success just by inserting herself into society using the family name. In affect she is a forgery to the extent that she certainly is not a hotel magnate nor has she proven that she could be a successful hotel desk clerk (if I’m wrong Ms. Hilton, get a job and prove it).
*Tony Pinto is fictitious and not meant as a racial slur. I am extremely sensitive to name jokes. As an Italian American I hear the Mafia thing all the time. For the record, I was too short and failed the gun test. And yes, to the folks at Ford, I know it was all a big mistake and you owned right up to it…in court…after the memo was discovered.
But this is what we have evolved into as a society of forgeries. At some point in our recent history, as technology began sweeping aside business after business - it all became a mad blur of failures, mergers and buyouts in what we call “doing business”. Companies barely out of the womb were either bought out or run over with a multitude of semi-original ideas buried in the rubble that was the 90s high-tech movement. Thus, an opportunity was born. People saw that if you came up with the right idea you could sell it with little investment of your time and money and make huge amounts of money. Some very clever people took advantage of this sudden, enormously foolish glitch in Fortune corporation culture. In the climate of this “doing business”, very little business was actually being done. It is funny how quickly we become accustomed to “money for nothing and checks for free”.
But Fortune companies today are forgeries as well. They are seldom run by the inherited name of some far gone ancestor from Ireland that stretched his poor arms to gather together ideas, money and grit to make his fortune (remember that is how the Fortune Companies originally got the moniker). Today’s Fortune Company is run by some hired assassin or bean counter whose biggest decision is which foreign country they will use to exploit our ideas and jobs. The lot of them have proven to be apathetic to the country’s needs - incompetent or illegal.
Take the failure in 2009 of Colonial Bank after it was discovered that Lee Farkas, the majority owner of Taylor Bean & Whittaker, once the nation’s second largest mortgage company, was convicted in less than an hour on all 14 counts of bank fraud, wire fraud, securities fraud and conspiracy. I don’t see his name on the company logo. But his personal avarice was so extreme that he and his merry band of fraudsters caused the sixth largest bank failure in American history. He is, unfortunately, the way many young, over-zealous execu-teens are beginning to form their thoughts about business. How do we insert ourselves in the middle of the deck so we can enjoy the fruit of our labor today? The heck with the kids… let them steal their own millions, right?
Having a lot of definitions to define your business does not give your business a lot of definition
So…to get back to the idea at hand, the Patriarchal System isn’t bad – bad people just exploited the natural flaws in an otherwise sound principle. But, as a business owner today, you should be aware that there is a better and more intelligent way to devise and expand your company. The principle is to take your idea and begin the process of radiating your sales and the culture of your mindset and ethics as you simultaneously look for like minds and personalities that leverage your full potential. Not a bunch of “yes men” but rather a smartly blended concert of balancing labors and vanities with the same honest enthusiasm for your idea, products and plans. Look for people of sound integrity and offsetting skills to join your effort. Pay them if you can - that’s better than having to share the idea, but share the idea if you must. Keep in mind it is no longer the day of competing against others who are hard at work and honest. It’s the days of forgery and your idea is as good as any. If someone can lift it with little effort and claim it for his own, why not do just that? It will not matter to them that they are just standing on your shoulders to steal your rightful reward. There are too many dishonest people out there. If you attempt to compete against that thinking you will not find a level playing field; not that there ever was such a thing. But today, more than ever as markets become global and your germ of a company needs to ramp up, the idea of a single mastermind is dangerous. Sure, some megalomaniacs make good use of their dictatorial and narcissistic tendencies but they are more often the rarity then the norm.
Forged is not forgery (not always anyway)
As you integrate into the business world there are more than enough forgers out there who will corrupt your idea before you can bring it to fruition. To get ahead of them you will have to think like them without being like them. It’s a tightrope to walk I admit, but it’s one you can walk nonetheless. In the end it will actually be about inserting your unique character and passion through your associates and employees to impact your market. In a later part to this series I will cover company cultures and how they affect who you are and how your personality affects a very specific market sector, even years after you are removed from day to day operations.
Today, the Ponzi scheme once associated with the likes of Bernie Madoff includes most banks, the government and many well respected Fortune 500 Companies. If the criteria for Ponzi is to build a worthless organization by stealing from Peter to pay a little to Paul only to steal from twice as many Pauls who then steal from three times as many Ralphs, then our entire system - from the over-valued and grossly revered athletes, actors and Fortune CEOs who bilk their companies for hundreds of millions as they quietly slip off into the night - is suspect.
Forgeries in some form or another have been around forever. Check back in history and it wasn’t too long ago that Moses Shapira in Israel forged an entire ancient nation and all their history (Google Moses Shapira for some interesting reading). Even before Shapira we have a long history of men profiting off forgeries, whether in the way they do business or the way they count their beans. Sometimes these forgeries make it past even the best detectors for a while and fundamentally change what we know about history and society. They change what we think about the moral values we used to treasure.
We have idiots like Charlie Sheen proudly announcing that he “bangs 7 gram rocks of crack because that’s the way I roll…” and networks are trying to put this guy back on primetime television. Come on parents, what does this tell your children? Can you possibly say “Yeah, let’s sit down and watch ole lovable Charlie as he uses the props to keep his balance because he has been out all night doing drugs”? If we don’t stop the nonsense and say “no more” then these amoral maniacs are going to continue to exploit your children, our business and our country. That is not okay! Say it!
I’m certain you don’t want to read my rants on this societal perversion so I’ll steer back to what is relevant. For every forged piece of crappy business that some lazy con artist tries to pass off on industry, there are hundreds of legitimate businessmen and women working very hard to promote genuinely authentic ideas. New products and services are emerging from our entrepreneurial population at a pace never before realized in the rich history of the American business world.
And although there is still a long way to go before we can actually call ourselves “in recovery”, I think we are at a place where we can begin to ask the right questions about our future after this economic Armageddon such as…What should we look like as a business if the old business model is no longer valid? How do we reverse this perversion of pounding out these ridiculous buyout numbers to stabilize our economy? How do we stop, or at least discourage, forged business models looking to take advantage of our generous system of freedom of information without the benefit of working hard for their money?
THE UPCOMING SERIES
Over the coming weeks I will be looking at all aspects of the business environment and economy in America – both as a retrospective to give you some balance and points of reference and as it looks and behaves today. In every section I will provide three elements. First, I will be exploring the historical roots of our country’s business. Second, I will provide relevancy in analytics, both statistically and organically, as they relate to business owners today. Finally, and most importantly, in every section I will frame simple but practical solutions you can use to secure your business, invest in productivity moving forward and provide for the general stability of your own market and profitability.
These next weeks will reveal some of the most intimate and important aspects of how America came to be what she is today in terms of her business modeling. It will be a wonderful opportunity for new owners to acquire a strong historical perspective on our markets; where they came from and where we think they may be going. And, of course, it will always be controversial as well as informative. I sincerely hope you will come back for more. Don’t hesitate to send me comments both good and not so good – I welcome all.
CEO The Bosson Group
O-209 333 7786
C- 209 642 2821
Frank will be taking excerpts from his various papers, advanced training courses, talks and his most popular business satires. These are the comments and opinions of Frank Bosson and do not necessarily reflect the beliefs of other individuals at The Bosson Group or our contractors or clients.