Last week, my breezy superficial comments on the demise of Ford and GM set off a firestorm of comments from our readers. Well now it’s my turn to respond.
MY COMMENTS LAST WEEK ON FORD AND G.M. SET OFF A FIRESTORM FROM OUR READERS.
Within minutes, I received dozens of angry letters protesting my “attacks” on two of the remaining “Great American Icons.”
Now, I never mind getting good old fashioned hate mail: I actually consider it a badge of honor when I get you riled up enough to actually respond to my writing.
But I have to admit that the level of pro-American pride and anti-Japanese manufacturing anger caught me off guard.
Perhaps foolishly, I thought these feelings had largely gone away after the “Roger & Me” 1980’s. Boy was I wrong.
Now I’m not saying that all the mail was bad.
Some folks actually appreciated that I was just writing what I thought was a light-hearted, superficial, and otherwise breezy article (especially when compared to my recent work on financial statement analysis) on an otherwise serious topic.
But as you can see from the very first response I received, I struck some serious nerves:
“… You better set your sights in American prosperity rather than your family dying in an Asian garbage can … If you are thinking foreign quality, get out of the Asian sewer and mention Germany — at least they are not trying to put America out of business. Or is it crack you base your foolish notions with? I am putting your propaganda on my block list. Maybe you will print this and let your boyfriend read it.” – Roger W.
Deep. Clearly, Roger is one angry man.
But his subconscious visions of homoerotic induced crack binges aside, under normal circumstances I may have just blasted him back in kind – perhaps even invited him to visit my own secret crack den.
After reading several other letters though (unfortunately far less graphic and angry), I sat back and tried to understand what would make some of these people so friggin’ angry.
So here’s what I have to say to “The Angry Respondents,” the group of people most likely directly or indirectly affected by the turmoil wrecking the U.S. auto industry:
To people who work in the U.S. auto industry, this isn’t some silly game played by intellectuals on Wall Street.
Real people are watching their lives being destroyed by this. Real families are wondering how they’re going to pay their mortgages, send their children to school, and even buy groceries.
That is some painful, personal sh*t to deal with – no ifs, ands or buts about it.
It has the potential to turn your life upside down and make you question everything you ever heard about the American Dream.
For those of you who worked your entire life, are close to retirement age, and are seeing promises made to you that can no longer be kept - I truly sympathize with you.
I am not arrogant or naïve enough to know what it’s like to walk a mile in your shoes and be suddenly confronted with the changes in life you are dealing with:
One day you’re about to retire, the next day you’re looking for a part time job at Wal-Mart.
To those of you who fit this description: If I was in your shoes I would probably want to punch the lights out of anybody who was making light of such a serious situation. So I apologize if my ignorance offended you.
Please charge it to my head and not to my heart.
Now on to the rest of you:
Several people wrote in and shared strong, honest experiences they’ve had with American cars they’ve purchased. And that’s great.
I have no beef whatsoever with you.
Just because of the horrible experiences I’ve had with my Ford (and plenty of other cars in my family I was too lazy to mention in last week’s article), doesn’t mean that I think they’re all bad.
So, for all of you folks wondering if I represented a full sample of Americans who love their American made cars, I have news for you: I didn’t.
Of the 100,000 or so people who read The Tycoon Report, fully 30% of you haven’t had the problems I’ve had … and I thought that in all fairness, I should take a moment and point that out!
But I MUST take the rest of my time here today to address the group of people that sent in BY FAR the most amount of misguided comments last week …
My generation – the Generation X’ers – who, by virtue of their comments, have proven to me that their attempts at Patriotism for Patriotism’s sake is just a misguided understanding of what this country is all about.
As much as I hate to break it to you, my beloved contemporaries, buying cars from Ford or General Motors simply for the love of our country shows a shocking misunderstanding of what this country is all about.
Now in the past, I’ve never used these pages as a platform to try and lecture anybody. That’s because I know enough to know that I don’t have all the answers.
But today I have to make an exception, because I am a Patriot.
So here is a news flash to my fellow Gen-X countrymen:
No matter what you think, we are NOT part of the GREATEST GENERATION.
We’ve never been asked to run into a hail of bullets as we stormed the beaches of Normandy …
We’ve never stood in soup lines because of 30% or so unemployment, and then debated packing up and heading west during the Great Depression …
And unlike our parents, most of us don’t even know that there used to be political policy choices between “Guns or Butter.”
Guns or Butter? ... m for our generation it’s been more like “Machine Guns AND Steak AND Butter AND Lobster Tail AND Everything Else Your Hungry Heart Desires.”
Nope, compared to our forefathers, we haven’t had to sacrifice squat for our country!
Sure, we grew up dodging the fears of things like AIDS during our sexual prime, and that sucked.
And what about the “sacrifices” our leaders have asked of us to battle our generation’s greatest threat, terrorism?
The sad truth is that it’s mostly poor people who are being asked to make the ultimate sacrifice on that one.
And this is coming directly from somebody who was there during the 1993 Trade Center bombing AND during 9-11.
Not only did I personally lose loved ones on that day, but I was one of those people covered in ash and running down the street for my life.
What do I have to say to all that?
Get used to it: Terrorism is the one price that every single great empire throughout human history has had to pay. It’s the price of power, plain and simple.
Just ask the Romans, or the Greeks, or the Egyptians, or the English, the Spanish, the French or every other great empire throughout history that has tried to project its power to further its self-interest.
In the case of the Romans, the “terrorists” were just insurgents in some far off province such as Gaul (France). When they acted up, a few legions were sent to squash it, and that was that.
And for us, it was pretty much the same for a long time: whenever our “economic provinces” acted up, the damage to the country was as bad as if they were throwing rocks at us.
But now we live in a world of WMD’S.
And everybody with a half a brain in their heads knows that, until we leave that cesspool of the Middle East, we’re going to have to live with the reality of WMD’S for a very long time.
Because unless we put an end to our dependence on foreign oil – and get rid of our gas guzzlers – our generation hasn’t been asked to sacrifice squat!
(And if you’ve bought into the concept that it’s impossible to become energy independent, then I suggest the next trip you take is to Brazil, where fully 80% of their cars are fueled by CORN).
What does all this ranting and raving have to do with patriotically buying cars from Ford and General Motors?
Since our generation has bought into the most superficial, moronic version of the American Dream that has ever existed from the likes of fools such as Donald Trump, at least you’d better know what you’re fighting for, folks.
And to do it the right way means that you’re going to have to make a painful adjustment to the way you think:
For better or for worse, the main sacrifice that our generation is being asked to make is the sacrifice of economic adaptation.
Remember folks, our founding fathers believed that the long-term success of this country would be based on our ability to replace the bloodline aristocracy with a performance meritocracy.
You see, our founding fathers believed that if government stayed out of our lives, then people would gravitate to the level of their own human natural abilities.
When Reagan so eloquently stated, “Government isn’t the solution – it’s part of the problem,” he was paying heed to the promise of our founding fathers.
You see, that was the whole point of the American Revolution: it was a revolution of the mind.
And to fully grasp what it means to compete in a true meritocracy – like the way our founding fathers intended – you’d better get a healthier understanding for the system that allows it to occur.
And in the system that allows it to occur, there are always going to be winners, and there are always going to be losers.
My point is that it’s the system itself that matters, not any winners or losers on any given day.
That’s why the people on the floor of the New York Stock Exchange applaud every morning at the opening bell.
It’s not because they think the market is going to go higher or the market is going to go lower.
They’re applauding for the actual market system itself!
A system that respects personal gumption, property, and the securities laws …
A system that can actually say that something like 40% of the people on the Forbes 400 list in a given year were never there before …
A system that didn’t care who won or who lost: what mattered was that the system itself was honest and strong, because when that happens, the society wins …
And last but not least, a system that - WHILE VERY FAR FROM PERFECT – is living the dreams of the meritocracy the founding fathers had in mind so many years ago.
So, if your goal is to wrap yourself in the American flag, do it by honoring the system itself.
A system we created and exported to the rest of the world, and that we play better than anybody in the history of human affairs.
And the smartest way you can honor that system is to respect the following two Rules:
RULE #1: HE WHO ALLOCATES CAPITAL MOST EFFECIENTLY IN BUSINESS WINS. PERIOD.
I know that’s hard to accept. Especially when it’s companies like GM and Ford that are the ones taking it on the chin.
But these guys had it locked down for a very long time. And for much of that time – at least during the 1970’s and 1980’s – they acted like it.
That’s why they made cars that were ugly and didn’t work well – they forget to listen to us, their customers.
And today they’re paying the price, because a whole generation of baby boomers spent money to buy them and got such a bad taste in their mouth that they’ll never go back.
It’s no coincidence that the Toyota Camry is the number one selling car to the Baby Boom generation – the exact customers American car companies spit on when they were buying their first cars in the 70’s and 80’s.
(Not to sound like a little cry baby, but there were SEVERAL occasions when my very own parents were stuck on the road virtually all night in an unfriendly place trying to get their brand new American car towed home. Unfortunately for Detroit, horror stories have a long shelf life.)
And now, right when most of these people have the bulk of their wealth, their decisions aren’t tough ones to make.
So just to overcome the trust issue – and the fact that cars like the Toyota Camry actually look and feel nicer – Detroit has to rebate their profits away just to get their cars out of the showroom.
Better luck with the next generation of car buyers, Detroit.
RULE #2: AMERICA HAS TRADED MANUFACTURING FOR SERVICES WITH THE REST OF THE WORLD.
The next rule our generation has to understand as we strive for economic adaptation is the fact that America just doesn’t value its manufacturing industry the way it used to.
Now I don’t expect non-financial professionals to understand this as well as I do. That’s because it’s my job to know this kind of stuff.
But if you take the time to read the fine print that is on EVERY TRADE AGREEMENT we make with other countries such as China, it goes something like this:
- We’ll sell you our high value “knowledge products” such as financial services, software, insurance etc.
- In exchange, you’ll use your cheap labor to sell us “non-knowledge” manufactured products such as cars and things of that nature.
The single basic reason we do this is because specialization of exports provides each country with the HIGHEST RETURNS ON INVESTED CAPITAL.
So, while our companies like Ford and GM are fighting for their lives against competition here at home, their companies (like China Insurance/Brokerage, etc.) are fighting for their lives over there!
Look, I know it isn’t easy to see once proud American brands struggle for survival.
And don’t get me started on ALL THE THINGS this country can do to ease the transition for the auto workers stuck in the middle. (Free education for ANYBODY who is in an industry the government decided to trade away would be a darn good start!)
But this revolution in thinking was started many, many years ago, and it’s what this country is founded on.
So if you want to wrap yourself in the flag of Patriotism, I applaud you, because it’s what will keep us strong for many generations to come.
But do it the right way: Start by applauding every morning when they ring the bell of the New York Stock Exchange.
At least then you’ll be showing respect for the meritocracy-based system our founding fathers dreamed of so long ago.
Because I have some news for you: At least in this capacity, their revolution is alive and kicking and working exactly how they wanted it to work!
Let the stoning begin!
CEO, Founder & Director of Editorial Content
The Tycoon Report