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A Pathway to Leadership
An Autobiography of Mike Ballantine
This is a self-written autobiography of Mike Ballantine prepared for his campaign to run for President in 2012. This document tries to capture both Mike’s life experiences as well as his philosophy.
Chapter 1 - Philosophy With any candidate, comes the necessity of writing a book. A book does more than reveal the history of a candidate but helps explain the candidate’s state of mind, philosophy, and relevant experiences that qualify him or her for political office. After innumerable delays, here is my attempt to try to help you understand my thinking, how I arrived at my ideas, and why I believe my proposals are better suited to meeting the needs of a 21st century America. For some, my detailed description of my life and experiences will be more of a concern, for others my philosophy and ideas will be their primary concern. For those who want to get to the heart of the issues, I will start with ideas and then move on to the recount of my childhood and international adventures. Personal Philosophy It is difficult to capture anyone’s complete philosophy because one would have to list an infinite number of what ifs but let’s start with some of the basics. As a child, I was raised in a typical middle class home until the age of 12 when my parents divorced. Suddenly, we went from middle-class to lower middle-class overnight. This taught me that nothing is guaranteed and that life can throw you curveballs when you least expect it. Still, there is much to say for experience, having lived through the traumatic turmoil that divorce brings upon a family as both a child and an adult, I believe I can better understand the needs of people who face similar trials. During my early years, I was active in Cub Scouts, then Boy Scouts, and finally the Order of the Arrow. I attained all of the highest ranks from Webelo, to Eagle Scout, and Vigil Honor. During this time I participated in Scouting in Philadelphia, Lancaster, and Harrisburg. I met and befriended hundreds of different young men as well as developed behavioral characteristics based on the role-models of adults that guided me. I have developed a strong
belief that role-modeling is more important in the development of character than any critical pedagogy in any school lesson. Scouting taught me a love of my country, a love for nature, and a willingness to help others without expectation of payment. It also taught me that when someone or something was in trouble I should lend a hand without question and do what is necessary. This is a quintessential part of being an American. We extend a hand in friendship and help others without expectation of compensation. It is what we do. This belief forms the core of my candidacy. America is in trouble and I believe I have the ideas to solve it. If I do not extend my hand then I am betraying the very beliefs that I was taught as a young man. Call me naïve but I still think public service is a good thing. I also believed that people were generally good and for the most part they are. When I was 14, my mother placed my two brothers and myself in Milton Hershey School (MHS). In 1977, MHS opened its doors, first to children who were not orphans, and eventually to girls as well. I was part of the first five children in this program and for me it was a great adventure. The main lesson I took from the school was that despite Milton Hershey’s failure in commerce, he never stopped believing in himself and continued to persevere until he achieved success. That is a strong lesson and one that I have always taken to heart. I always strive to work harder and I do not let roadblocks deter me. Every problem has a solution, life is about solving problems and not all solutions have been discovered. MHS taught me a few other things, such as the value of capitalism and the need for those who gain great reward from the community to return some of that wealth back in the form of charity. When I graduated in 1980, I had $100 in my pocket and the world at my feet. As a banker, I quickly learned that the key to building a business was making friends with the banker. You see bankers are not all that interested in lending money to small business.
If 9 out of 10 businesses fail in the first 5 years, why would a banker lend money to a small business? This was a valuable lesson and in all my business adventures I have tried to establish relationships with bankers and build trust. The same can be said for politics. Without a network of trusted supporters, a politician will fail regardless of how great he or she understands problems or the solutions that he or she provides. In business, I learned about team work. No business owner can run a successful growing business without the support of a solid team and good workers. My boss, Jeffrey, taught me that business owners can become self-absorbed and forget the contribution that others make to the business. Do not misinterpret my statements as harsh towards Jeff. In his own way he is very generous with his employees and especially his managers but it is done more as a reward from on high than one directly related to business profitability. My experiences with Jeff helped formulate my belief in employee ownership, despite all the CEOs of America believing they are the greatest captains of commerce, great workers are the real reason for their success. One of my many faults is that I am a workaholic. Anyone that knows the behavior of one, knows that a workaholic usually puts the job before his or her family and I am no different. In America, we value success and success is measured through promotion and the accumulation of wealth. This goes back to our Puritan tradition and is somewhat unique to American capitalism. That being said, I have made the mistake of ignoring my personal relationships, putting my work first. This led to two divorces and huge gaps in time where I did not see my children or appreciate the wonderful experience of fatherhood. Both my oldest sons are Eagle Scouts too, so I hope that I have not been as bad a father as I accuse myself of being. My second wife thinks I am the scum of the earth and refuses to allow me contact with my daughter. That is probably my biggest regret. Some problems need time to work themselves out and so I have
learned patience. As a parent, an international businessman, and a teacher, I have learned that being patient is one of the greatest skills anyone can ever possess. A second lesson that I learned from my time at Shank’s was the amorality of capitalism. It is not capitalism’s fault and it is no more amoral than science. At its heart, capitalism is about maximizing profit and any executive who does not do that, risks losing his or her job. Owners can choose to be generous as long as profits support it but when profits begin to erode so does generosity. In my case, I was running a factory in Madagascar and my replacement at the home office, Bob, called me and told me I needed to cut costs in half. The company was having trouble and they needed me to reduce expenses. That sounds reasonable except, my costs were $3,000 a month including rent, utilities, and 50 employees including 4 managers. My rent was about $1,600 a month. To me, $3,000 is the cost of one American worker and I found his request to border on the absurd. In essence, he wanted me to fire my entire staff and then when I needed workers the next season, rehire new ones. These people depended on me for their existence but what choice did I have? In the end, I closed the factory and submitted my resignation. When I went to Vietnam to work for another spice company, capitalism had not changed, I had and I decided that teaching might be a more suitable occupation. I do not dislike capitalism in general. People need incentives to perform well. Profit can be a very powerful motivator but that does not mean we should allow it to go to extremes. In fact, I read somewhere that ‘one should only eat and drink in good measure and do it for the glory of God.’ That statement could be interpreted in many ways. For me, I interpret eating as any type of activity that we desire so whether it be ice cream and beer or it be profits and sex, one should do it in a measured healthy way that brings reward not pain. Again, my addiction is work and for that I have found myself unable to live by my own expectations. So for others, I
am careful not to throw stones. Learning to be tolerant is a powerful tool for success in life. Those who live in glass houses should not throw rocks. To come full circle, I believe that we should accept people for who they are and not what we think they should be. One should love one’s country above all personal needs and extend a hand to one’s neighbor when they are in need. After all, I heard that a few loaves of bread and some fish can go a long way. Instead of confrontation, most problems can be solved through patience, discussion, and mutual respect. The great problems that divide us, do so because we let them. For every problem there is a solution, just because we have not thought of it does not mean it does not exist. On Capitalism As a student of economics, I have spent untold hours with my head immersed in books, newspapers, and journals. For twenty years, I read the Wall Street Journal, Forbes, and US News and World Report. For the past 10 years, I have read the Economist cover to cover every week. To anyone who has ever picked up one, that is no small feat. My point is that with 5 years experience in banking and finance, 10 years experience in corporate accounting and finance, and another 5 years experience in international management, I have accumulated a wealth of knowledge about how capitalism and business works. I understand its positive characteristics and its negatives. If I seem harsh in my characterization of capitalism, it is only that the laissez-faire notion that capitalism should be allowed to run free unimpeded is more like having a herd of steers run through a village chased by a T-rex. Our founding fathers rejected unbridled capitalism and they did so for good reason. The role of government is to balance the needs of business with the needs of the people. If one or the other has too much power then the nation suffers. For me, the current situation is
out of balance so I want to reset the balance between capital and labor, not change capitalism itself. Adam Smith in his famous work, ‘Wealth of Nations,’ aptly described capitalism and its role in society and government. He described how capitalists seek to create scarcity to justify higher profits either through hoarding or limiting output. For a capitalist, this is the natural order of things, after all if we all had good housing, plenty to eat, and needed for nothing, where would the profits come from? People on the other hand want the lowest price, the most competitive markets, and unlimited choices. The needs of people and of commerce are diametrically opposed. Businessmen will say what I say is untrue but show me one market that is not dominated by oligopolies. Capitalists seek concentration of production to form economies of scale. Through bigger economies of scale, a businessman can undercut his competition acquiring more production, leading to market dominance. That is what capitalist do, knowing that should provide simple explanations to what we see. The current trade issue with China is not about regulations by government or even workers’ salaries. That is a straw man. The real issue is that multinationals are trying to consolidate production in the largest market. To dominate a market, a company must be close to it and maximize efficiency. The US could drop dozens of regulations, even abandon the minimum wage laws and it will have little effect on multinational behavior. There are 1 billion potential consumers in China that will be buying their goods and frankly the American economy is already mature. Those companies are not going to come back whether we let them repatriate money, relax regulations, or reduce workers’ salaries. A second thing we learn from Adam Smith is that countries should use their currency to undercut their competition to concentrate production and dominate markets. That is exactly what China is doing. The irony is that China is being a better capitalist than America.
My solution to the current problem between our businesses and our people is neither new nor unusual. Teddy Roosevelt faced these same problems 100 years ago. Those who forget history are doomed to repeat it. Firstly, to counter the thirst for profit from overseas factories, I propose tariffs. The simplest way to make offshoring undesirable is to take away the cost advantage. Whereas, some people decry this as increasing costs for consumers, what is our objective, having good paying jobs or cheap sneakers? A second step is to give tax incentives to companies that are employee owned. Germany involves labor in its decision making and their economy is very healthy despite paying similar high wages to their employees. I believe that when employees have an ownership stake, they have a powerful motivator to work hard, and by increasing employee ownership, we will reduce offshoring. Finally, a government must protect the jobs of workers. That does not mean we protect every job but it does mean we do not stand by and watch industry after industry leave our shores. We need fair trade policies and trade protection for key manufacturers and infant industries. As an experienced overseas buyer of 15 years, I learned the meaning of value and it has little to do with the lowest price. Conservatives and Liberals As a self-described moderate, I find the dramatic lurch to the right by our nation promoted by Christian groups and neo-cons to be frightening. It is one thing to say we should take change slowly and consider the impact of new ideas. It is quite another to demand that we return to some antediluvian 1776 existence. The world has changed, our nation has changed, there is no going backwards only forwards. The demands by Christians to reinject values and morality into our society is a natural reaction to changes that they feel they have no control over. Instead of setting up two diametrically opposed camps we need to discuss the issues like adults. Watching the Republicans argue amongst each other is as Speaker Gingrich said, “like watching
a bunch of 7th graders.” That is how I see the arguments between the left and the right. Neither side will give an inch, damn the torpedoes, full speed ahead. As for neo-liberals I find the way they promote their ideas to be sneaky and dishonest. Granted, the American people need a push at times but indoctrinating children in schools through hidden curriculum to think things that are in conflict with their parents beliefs is wrong. America will change, we will move to a more liberal worldview but we can do it over 50 years instead of 15 and the end result will be the same just a little slower. If you educate someone to think critically then you have to assume they will come to the same conclusion about what is right and wrong. Better to educate thinkers, than to propagandize children. I sympathize with conservatives when they demand changes to our educational system. I do not have a problem with the goals of liberalism, just the road liberals have chosen to follow. One of the greatest issues dividing us as a nation is abortion. Personally, I think abortion is wrong and a terrible choice that some women make. However, I recognize the utter hopelessness of raising a child alone and the burden that responsibility places on single mothers. The conservatives would have us end abortion but offer no financial or emotional support for unmarried mothers or teens. What a terrible idea. How can any self-respecting Christian say you cannot have abortion and because you got pregnant you are on your own? That is not Christian, it is hypocrisy. If Christians said, that they wanted to stop abortion and would provide full car for pregnant mothers as well as financial support after the child is born, then Hallelujah, pass the collection plate. But they do not, instead they say, take your ‘bas…’ and go crawl back in the hole you came from. That is one of the many reasons I do not consider myself a Christian. I can only listen to the sanctimonious nonsense of the Rick Santorums and Michelle Bachmanns for so long before I want to use Jesus’s words, “he who is without sin, cast the first stone.” Sin
comes not only from ones actions but from ones thoughts and feelings. The sins of the heart are far greater than the sins of deeds. Jesus said that he would judge a person by how he or she treated the weakest member of the community, not only fellow Christians. Christianity is a religion of kindness, love, and understanding, our religious right is a militant extreme perversion with more in common with the Inquisition than the 21st century. Socialism The right wing always trots out their favorite boogey-man, the socialist. To listen to Glenn Beck or Rush Limbaugh, we are on the verge of being overrun by communists in disguise and they are going to take our guns. Here is a newsflash, socialism lost, capitalism won. Even in that deepest redoubt of socialism, Cuba, they have finally opened their doors to capitalism. The problem with socialism is not its desired outcome. Who wouldn’t want a world where there was no war, no borders, no hunger, and no unhappiness. I love John Lennon’s song, ‘Imagine,’ and sure, I would love to have a utopian existence too. However, like Hobbes, I believe that man is basically selfish. We can overcome our natural instincts through education but unless we begin some horrible genetic experiments to breed the selfish gene out of our DNA, man will continue to be a selfish beast seeking to fulfill his/her wants and desires. This is what gives capitalism its strength, the greed motivator. There have been many successful socialist experiments and they all depend on one key component, size. If you know everyone in your community, then you are naturally willing to make sacrifices for them. Your altruistic instincts are satisfied and you offer your help and charity. When you go beyond your local community, you have to make a decision between leisure and work. People may be willing to work harder for a short time to help a brother but over the long run, they are not. We saw this with the original food aid promotions led by U2.
Initially, everyone was willing to contribute but eventually donor fatigue set in and people went back to their lives. Socialist economics depends on unlimited resources and no markets. To value something, one must calculate the quantity of energy, human labor, and raw materials. If we have Star Trek like replicators that would change our reality but we do not. Without a market to determine value, one has no way to determine the most efficient employment of energy, human labor, and raw materials. We end up returning to a pre-industrial existence with master craftsmen and farmers. We cannot do that with 7 billion people to feed. Hence, socialism depends on large population reductions and I shudder to think how we would arrange that. Until man overcomes his natural instinct of greed, I am not persuaded that socialism is the right track, instead I think we need a friendly version of capitalism that incorporates socialist values, what I call progressive capitalism. Progressive Capitalism This idea makes people that believe in small government cringe. But take a step back for a moment and think about what libertarianism and socialism have in common. One might be surprised to know that the only difference between them is the ownership of private property. Socialists do not believe in big government, they believe in no government. Libertarians believe that the government should exist to provide defense of private property and nothing more. Further, most libertarian values come from the philosopher John Locke. Locke’s philosophies influenced our founding fathers. Like modern libertarians, Locke believed government should be small and only there to provide security for the people. That was a powerful idea in the days when kings ruled and people were chattel to their landowners. However, one idea that libertarians conveniently forget is that Locke said that no one should
keep more than they can consume. He was against rampant speculation and the hoarding of wealth. He felt that wealth should be reinvested into the community toward more profitable pursuits thereby lifting all boats equally. Conservatives pay lip service to this idea when trying to sell tax cuts but fail on their support for big business. As a progressive, I believe it is necessary to redistribute excess wealth back into the community so that the community prospers. I am only pursuing the ideas of our first libertarian, Locke himself. Many say that government is inefficient and terrible vehicle for implementing programs. And that is true, it is a terrible decision maker, it is slow and ponderous and if given a choice, I would be happy to see a small nimble government that not only had fewer regulations but allowed people to do as they please and kept their noses out of our homes. However, enter the multi-national and the picture changes. The multi-national cares nothing for the American citizen only the latest quarterly statement and why would it? To protect the community against the worst excesses and abuses of the multi-national, government must impose regulations to insure fair wages, safe working conditions, clean air and water, and a healthy community. If one has ever lived in the 5th world as I have, one would know the difference between the standard of life in a regulated nation and one in an unregulated nation. That is not to say that some regulations do not need revision and I am a firm believer that all regulations need an expiry date or sunset provision. A second area where I differ with the current fashionable economic beliefs is in the role of free-markets and government intervention. The first choice is to allow markets to adjust
naturally and through the process of creative destruction continually improve the economy and nation. I get it. However, what does one do when the free-market stops working, like now? In fact, our free-market is unable to get going for some very fundamental reasons:
Banks lend on home equity to small businesses, home prices have fallen 32% wiping out equity
$2 trillion is sitting in banks at zero% interest doing nothing 50,000 factories have closed so even if one wanted to open one, there is an 18 month lead time
• • •
Government is cutting spending, leading to more layoffs and more unemployment Interest rates are at zero and can only go up, but by how much? Housing construction has stalled because 10 million homes are in foreclosure limiting demand
The government deficit is absorbing most of the available investment money in the economy
There is no demand for American exports American students lack basic reading and math skills in an advanced economy
To offset these issues, our economy needs to create artificial demand. As a progressive, this means I accept the idea that government through targeted investments in infrastructure can create demand and create jobs. This is hardly an earth shattering idea and in fact was standard economics until very recently. The idea that we can cut our way to prosperity has no factual basis and is an emotional response to a difficult problem. If we cut government spending, we increase investment but we decrease demand. It is the exact opposite of what we need to do to fix our economic problems. It is the same thing as taking your eye out because you don’t see well. If the economy needed money to create demand, then this might work but there is $2 trillion sitting in banks. Not only is the Republican strategy misguided but it could cause a calamitous downturn leading to massive poverty or a civil revolution like Greece is experiencing.
That is why I propose government intervention on a temporary basis to jump-start the economy and create demand to get the wheels turning. I do not believe that government can solve our problems. I think government creates as many problems as it solves but for three years Americans have been waiting for the invisible hands of the free-market to solve our nation’s problems and those solutions are as distant today as they were three years ago. I do not believe our nation can survive a decade of depression without fundamentally altering who and what we are. Our leaders have an ethical and moral responsibility to provide jobs for the people and as a progressive, I know how to do that. Any child can open a basic economics book and find my solution. Allowing personal emotional belief that government is the problem so any government solution is bad to cloud a leader’s judgment is criminal. We are not talking about widgets, we are talking about people’s lives, their dreams, and their aspirations. Telling the people to put those on hold for a decade is not leadership, it is abandonment.
Chapter 2 - Youth
The first part of this is second hand because I don’t really remember my birth. That seems to be the way with things, we forget the beginning but remember the ending. My mother grew up in Willow Grove, a sleepy suburb of Philadelphia. She was the youngest of three daughters and probably a little spoiled. The one story of my mother’s childhood that I remember best was about her as a grass hockey player in high school. Mom played goalie and in one game the ball hit her and broke her arm. Mom’s pretty tough, so she finished the game. Despite all the bad things that have happened over the years mom’s always soldiered on. I think that is where I get my perseverance from. My father was a lady’s man and he had a lot of lady friends. He fought in the Korean War and came home and took a job at a local company called Asplundh. I used to go in and help him with payroll which started my interest in accounting. I would wander around the factory and watch how everything worked. Prior to meeting my mother, dad had married, had a son, my brother Pete, divorced her, and went down to West Palm Beach where he fathered another son whom I have never met. I believe his name is Scott . I am not sure how many kids my dad had, so there maybe more. My father was hardly a man to admire and I always said I wouldn’t be like him when I grew up. In many ways I have avoided the worst of his excesses because I don’t drink much. However, I have had a few children, so I guess the apple didn’t fall far from the tree. Mom met dad at Asplundh, from her pictures she must have been a pretty hot blond with her ’57 T-bird. Sons aren’t supposed to think about that so I’ll leave it there. My dad managed to talk his way into her heart and in October they got married in Trenton. I was born in April, a month early because dad was in a hurry to get somewhere and driving his pickup on the back roads. Anyone who has driven fast down a country lane understands the stomach dropping
moments and my dad forgot he had a wife that was 8 months pregnant in the cab. I was born the next day, a month early on April 4th. I have been rushing things ever since. To Jerome Corsi, you have my permission to go to the hospital and check my birth records. I was born at Holy Redeemer Hospital in Meadowbrook, PA which is near Abingdon outside Philly. I release the hospital from any privacy issues and hold them harmless, no circus needed here. I don’t have much to say about my dad’s parents. I saw them in pictures but my mother and my grandfather had a disagreement early on and I didn’t see my grandfather again until I was 10. When we moved to Lancaster, that pretty much ended visits until I graduated from college. Grandmother died when I was 14 so I never got to know her well. On my mom’s side, her mother died when she was 15. It hit her hard and that’s one of the reasons she married dad. When my grandmother died, my grandfather began to fold in on himself and he spent the next 35 years waiting to join her. My grandfather was a wonderful man but he just never seemed to have any spark of life. I always admired his stoic patience and ability to escape from the pressures of life though. Like his parents he lived well into his 90s. One can see, our family wasn’t very close and that’s probably one of the reasons I don’t feel the same connections that other people do to their families. In hindsight, that’s probably not the best way to live one’s life. We lived in Willow Grove with my grandfather until I was about 3. During that time, my brother Charles was born. I don’t have anything good to say about him so let’s not discuss him. After Willow Grove, we moved to Trevose, another suburb of Philly just down the road from my uncle’s house and grandfather’s forktruck company to an apartment complexcalled Petony near the railroad tracks. They could have been in Mexico because I don’t remember ever visiting them. My brother Pete, his wife, and two lovely daughters live over that way. I don’t really know them but I wish them the best and apologize for any adversity my campaign might
cause them. My childhood was pretty normal for a kid growing up in America. Jerome, there was a civil case between the apartments and my father when I was injured by a lawnmower in 1968. The best story from the apartment is when my brother Charles got his foot stuck in a cinderblock wall. Mom panicked and called the fire department, but the fireman was very nice as he untied my brother’s boot. We moved from the apartment to a house on Bandon Drive just near the Liberty Bell race track and we lived there for about 6 or 7 years. Our house was just a couple of blocks from my elementary school, Stephen Decatur. I had some great experiences there but it’s odd which ones stand out. I remember my first love, Lisa Davidoff. Her father was a superintendent of the schools. I tell this story to my students because in Vietnam, students aren’t supposed to date until they are 25. Anyway, Lisa and I met on the first day of school. She was very shy and I am sure we were both terrified but she was crying and needed a friend so I had to be the strong one. I walked her home from school every day that year. That kind of set the tone for the rest of my life. I always seem to go for the girls that need a protector. Once they no longer need protecting, I get caught up in my work and the relationship gets sacrificed on the altar of success. Our budding love affair ended after a year when her father got transferred downtown. The first women to leave me but not the last. I remember very little about first grade. Just learning about money, go figure, and meeting my best friend Frank Gagliartti. I have no idea whatever happened to Frank maybe he moved away. The summer before first grade was tragic. We celebrated a friend’s birthday in July and in August he was killed crossing the highway near our house. I always have this graffic picture in my head from that time and I have always been hypersensitive with my children when it comes to cars. I remember learning to read in second grade, third grade nothing and 4th grade learning to play the flute. Everybody had to learn how to play an instrument. I chose the flute
because it was small and light, easy to transport. I volunteered to be on the safety patrol. It was kind of cool walking around with a badge. I joined cub scouts at 8 and quickly worked on all the badges, eventually getting my Webelos. I think every child should join Scouting. It’s an opportunity for kids to get out with nature, develop good civic skills, and learn teamwork. Children should learn social behavior in community organizations then schools don’t need to worry about teaching it. Instead of teaching behavior through hidden curriculum, why not just require kids to belong to a civic organization, it’s fun, builds friendships, and it teaches kids the values we want. Let school be for reading, writing, and arithmetic. I continued on in Scouting and went to church on Sundays. Later in college, I had been studying with a classmate for two years before we realized we had studied in Sunday school all those years ago. Just one of those interesting things that happen to people, I think the world is a very small place despite 7 billion people living here. I guess I didn’t learn much in Sunday School. I seemed to recall that Jesus was a loving forgiving kind of guy. They taught me parables and stories that sounded much different from those I hear today. There was the story of the five loaves and two fishes where Jesus was able to feed a multitude because everybody shared. I guess that was before entitlements, nowadays Jesus wants us to leave people in the street to die or so I heard on one of the debates. I also remember a story about Jesus telling people if someone asks you for your shirt, give him your coat. I must be misremembering that one too. We always joked about how a rich man couldn’t fit through the eye of a needle. I think Jesus was talking about the one in Seattle. Plenty of fat rich guys can fit through the door there. My father had a drinking, gambling, and womanizing problem. One day he was drunk and took some valium, that being the prescription drug of choice, and went to the dentist. I used
to mow the dentist’s lawn for $5, my first job. Anyway, he passed out and the dentist called an ambulance. That was the beginning of the end of my parent’s marriage. You can imagine the embarrassment of my mother after that story went round the neighborhood. We stayed in the house for awhile but when the divorce settled, we moved to Lancaster. When we moved, I left my best friend, Paul Lamon. Great guy, lost track of him, I wish him the best. I used to go over and play board games with him for hours. He had really cool parents. His mom was a Cher look-a-like and I remember his dad had long hair. I always wanted hair like that. Paul went on to study at a Center High School and I am sure he has become successful. He was always smarter than I was in school probably smart enough to know not to run for President. My brother and I learned to fight on that street. The neighborhood kids were kind of tough. I think the first month we lived there we got into a neighborhood gang fight. It’s pretty funny looking back, the little kids from Bandon fighting the little kids from Academy Road. My brother and I got in lots of trouble for that and we became good friends with two brothers from the other gang afterward. There dad was a city cop and he talked to my dad and there it is. Another neighbor was Kenny Vile. I remember him because his dad ran a trash company, he owned a Saint Bernard that bit kids, and he always had plastic on his furniture. I guess if you own a Saint Bernard you put plastic on the furniture. Kids don’t think that way and I always thought his mom was a little weird, sorry. I was a wuss back then and afraid of the other kids. My brother was the tough one, always leaping in to slug it out. One night, I got into a fight with another kid who was bigger than me and my brother came to my aid and together we beat the tar out of him. A neighbor lady came out, Mrs. Brown, and stopped us from smashing his head into the curb. I always felt bad about that but he was a bully and I learned a valuable lesson. After that, I just threw myself into
a fight whenever a bully was picking on some kid and I haven’t stopped. Sometimes I get knocked down, but bullies are surprised when you get up and keep on swinging. I had a fight with my buddy Paul, something stupid and I popped him in the nose. We didn’t talk for a month but one day another big kid was bullying him in the playground and I just walked up and cold cocked this kid, knocking him down. He never saw it coming and Paul and I were friends again. On the way back into the school, the teacher asked me what was going on, I said nothing now and kept on walking. People today get all fired up about bullies. They want to end bullying and neuter children by removing all the aggression. I am not saying bullying is good but it is a part of our society. One cannot understand good, if there is no bad. When one graduates from school and gets kicked out from the safe cocoon of childhood, there are bullies out there. If you don’t learn how to handle yourself as a kid, how will you learn how to handle yourself as an adult? If anyone every checked out Wall St, one would find that we reward bullies in American society. We give them Mercedes, million dollar bonuses, and adulation in every business publication. Our society is founded on commercial warfare where the best and biggest dominate the smallest driving them out of the marketplace. If we ever move to a society based on mutual respect, bullying will disappear overnight. For now, it is a part of our culture and children need to learn how to stand-up for themselves in preparation for the capitalist economy. Sometime around 1970, my brother Carl came along. There are 7 years difference between us and for children that can be a lifetime. I never got to know him as a kid because we got split up when he was just starting first grade. I remember babysitting him after school and not being able to play sports, I think I understand latch-key kids. When teachers complain about kids missing school to take care of other siblings, I feel for the kids because I know family
comes first. Teachers have this ridiculous idea that school comes first. I guess we all prioritize the things we do and forget that other people have their own lives and problems to deal with. I really don’t know my brother that well but he has a great wife and a lovely daughter and I wish him the best. When I was in fifth grade, the city turned its schools upside down with mandatory busing. Happily, I got to stay at Decatur for another year and became the captain of the safety patrol. I used to ride my bike all over the city and check on all the other patrollers. Sometimes I would have to get out and play crossing guard if the crossing guard was absent. Those were fun times. The best part of 5th grade was my teacher. I don’t recall her name but she was the second love of my life. I spent 5th grade in a netherworld and was probably the most obnoxious teacher’s pet ever. I got over it after about 2 weeks in the summer as I got to go on my first big camping trip with Scouts. When Jerome checks my report cards, he will find I was a mediocre student who needed to try harder. Scout Camp was an adventure for me. This was my first week away from my family. Scouting had always been a big part of my life for the previous three years as a Cub Scout. We went to camp and I don't recall the name because we only went there the one time. During the week, a group of us got really bored. I forget what the problem was but for some reason we were all sitting around. We went to one of the campsites and started a shingles battle. Each side would tear off some shingles and throw them at each other like a snowball battle. Needless to say, we all got a thumping when we got home. Our parents had to go back up to camp and reshingle all the lean-tos. That was another learning experience and I showed more respect for property after that. I can't even remember how it started or why. The next year we went to Treasure Island and I got initiated into the Order of the Arrow.
The Order of the Arrow is a fraternity within Scouting that brings potential leaders together to develop specific skills. The Order associates itself with traditional Native American dances and ceremonies and helps build appreciation for other cultures. I remained active in the Order, advancing to Brotherhood, and then Vigil honor when I was in college. I would routinely perform all the ceremony dances and performances dressing up in my Billy Jack costume. One of the great things about Scouting besides its development of leadership skills in its members is the blossoming of a need to serve others that comes from all the activities.
During my first year in Scouting, we had one of those unfortunate issues that sometimes arises in Scouting that adults only whisper about. Our Scout leader was caught with one of the boys. I didn't really understand what that meant at the time and I really don't know what happened, just he wasn't our Scout leader anymore. Our new Scout leader was a great man by the name of Jack Taggert. Jack quickly helped bring stability to the troop and mom seemed attracted to him. I am not sure you would call it dating but Jack was around more and more at the house, kids at that time didn't really pay attention to these things. One concern for Jack is that if he was going to go further, he wanted mom to join his church. Mom asked me if I wanted to come along and I of course said, yes, Jack was my hero. I will never forget the day because it was my brother's birthday in May when we were supposed to go get baptized in 1976, mom chickened out. I guess she felt she didn't need to get baptized again. I had been baptized as an infant in the Episcopalian church in Trevose so for me it was all kind of new. Mom asked me if I wanted to go ahead and get baptized, I said of course. I had given my word to my hero and to go back on it would be the same as lying so I went and got baptized, we left for Lancaster four months later so I really never got to understand what it was all about until later.
I attended Benjamin Rush middle school where I suddenly began to blossom intellectually. My biggest challenge was learning French. I had a lot of trouble at first but after the first semester it suddenly got easier. That’s the way languages are for me. I need to reach a tipping point where all the pieces start to come together. I ended up tutoring my classmates in high school but we’ll save that for the next chapter. I had some good friends in middle school but their names escape me. Most of my friends were the geeky kind, the ones that needed protection and I was happy to have them. If you can’t be the leader of the pack, make your own. I started dating and became interested in girls on a more amorous level than in the past. I still didn’t understand the whole mating ritual thing that teenagers go through. I tried to copy the adults but that didn’t seem to work very well. Our babysitter was 14 and he had a girlfriend and I was 12, so out of curiosity I asked him what he and his girlfriend did. He said let me show you, bad idea. That one haunted me for a long time. At the end of the summer in 7th grade, my father and I were supposed to go to Paris on a school trip but with the divorce that got scratched. It left in me a yearning to travel and that travel bug stayed with me a long time. Eventually it led me to go to Jerusalem and a career overseas, but that can wait. When we moved to Lancaster that summer, I had to give up my dog. That was the lowest moment of my life. However, I wanted to show mum I was strong, so I carried my dog Mandy into the pound where I knew that she would be put to sleep. We cried all the way to Lancaster and it seemed bad luck followed us along the way. And yes, I was a Barry Manilow fan, I admit it.
Chapter 3 - Teen-age Years
One of the greatest parts of moving to Lancaster was our big house in the city. Lancaster is much smaller than Philadelphia so it seemed like we were downtown, although no more so than when we lived in Philadelphia. The house on the 600 block of Chestnut Street had five bedrooms and a decent sized yard. We had nice neighbors, Carol Gerz and Paul Shaub, who humored me by playing Scrabble on many a quiet evening. The Gerz’s were Catholic unlike us and for some reason I always remember that. Mr. Gerz was very soft-spoken, whereas Carol could talk enough for both of them. I had a bit of a crush on their daughter but she was a little too young for me at the time. Paul worked at Farmer’s First Bank and inspired me to take up banking. After a short summer respite, school started. When school started, my brother Charles and I attended Lincoln Middle School. Carl went to the local elementary school. I had to watch Carl in the afternoons, whereas Charles got to play soccer. Carl was a good kid so not too many problems. Charles and I were routinely at each other’s throats much like most brothers close in age. On my first day, someone showed me to my class. At the end of the first day, I got up and went to the principal’s office and asked why I had been put in such a low-achieving class. I had been accustomed to much more challenging class-work in Philadelphia. The Principal remarked that they started new students in this class until they were confident of their performance. I said, trust me, I can handle it, and he put me in a more difficult class. The next day, I joined my new classmates and it was decidedly more challenging. The lesson I took from this, is that sometimes all you have to do is ask. After all, they say 80% of sales is just showing up. During my time at Lincoln, I learned how to ride a horse, write poetry, and make friends without having to worry about bullying. Unfortunately, my time there was cut short. In April, my brothers and I left for Milton Hershey School. The school had recently decided to open its
doors to children from disadvantaged homes as well as children that had lost a parent. Mom was very short of funds and it was this or go to foster homes. Later, they opened the doors to girls as well. Personally, I think they should have had two separate high schools, when the girls showed up, it became a major distraction. Imagine 10 girls and 400 boys in high school, one can imagine how popular they were. On a positive note we got a new lady gym teacher and she was cute, my second teacher crush. When I arrived at Hershey, I went to live in a student home with my brother, that didn’t quite work out because we were like night and day. Later, they would separate us and Charles ended up leaving the school and going to live with dad, bad idea. Carl was too young to board with us and I only saw him for about 15 minutes on Sundays. Eventually, we became strangers because we had our own circle of friends. Our housemother, unbeknownst to us, was suffering from a brain-tumor, she died shortly after I moved to my next home for high school. I tangled with her once, which was unusual for me. I was always the well-behaved son. I remember her trying to tell me how to cut my French toast properly. “You must use a fork,” she said. I replied, “then, why put the knife on the table?” That didn’t go over so well. I was a little precocious, so I went to the Principal again and I explained how I had reviewed the course offerings for ninth grade and found that I had already completed them in eighth grade in Lancaster. He was bemused by this little kid talking to him about the curriculum. He asked me what I thought he should do and I responded, let me skip a year and go straight to tenth grade. I guess he liked my spunk, so he said attend summer school for Math and French, show me you can do the work and you can skip ninth grade. I said, deal. That summer, I moved to a new student home, Bonniemead, a big old farmhouse on the edge of the campus. This was a home especially for Boy Scouts and I continued with my one
passion, Scouting. The Yackleys were our housparents and they were a little old and frumpy. They reminded me of the Gerzs because Mr. Yackley was usually quiet unless we were really doing something naughty. We thought Mr. Yackley was a little odd because he was an entomologist. What kind of person studies bugs? He was a good man and provided a strong role-model for me. I learned patience from him although most people would say it was a lesson slow in coming. The first summer, we went to Scout camp and then I went to summer school. I had no trouble with the Math and ended up tutoring my future classmates in French. I had had three years of French and they were in their first year, no problem. Life at Hershey was pretty easy-going, one did his or her chores, played intramural sports, and went to class. These were great years in my life and in retrospect, I should have stayed another year because once one leaves the comfortable grounds of Hershey, it’s hard to regain all the benefits one enjoyed. One of the most important lessons I learned at Hershey was about success. Uncle Milty, as we called him, had built the Hershey Chocolate Company and with his wife started an orphanage for boys because they had never been able to have children. That’s a powerful idea about charity and giving back to the community that has never left me. The number of lives that their generosity has touched over the years is incalculable and the impact on my life was profound. Another lesson, I took from Hershey was that success doesn’t come easy and the road can be long and hard but if you are patient you can succeed. Milton Hershey failed at business twice before he hit on the right formula. That taught me that failure is not a bad thing but a lesson learned. Each time we fail we learn from it and the smarter ones try not to repeat the same mistake again. It gives new meaning to the colloquialism that if at first you don’t succeed, try, try again. For me, here was living proof and I decided that no matter what, I would keep trying, failure was just a speed bump on the road to success.
When we had arrived at the school, the supervisor gave us each Milton Hershey’s biography and asked that we read it. I’m a bit of a book worm and I quickly read it from cover to cover. Besides reading about Hershey’s famous failures before his success, I read about his program during the depression. During the depression, the chocolate company continued to make money, I guess people still like to eat candy even in bad times. However, many of the employees’ family members were without work. To counter this problem, Hershey started to build things. He built a new high school, a new Hotel, some civic buildings, the football stadium, ice rink, and all the while kept the townspeople working. What Hershey did was create his own infrastructure program for the town, something other wealthy industrialists could copy during these hard times. I learned that when the market doesn’t work, someone needs to step in and create the demand to keep people working until the bad times pass. My proposals for an infrastructure bank derive from this lesson of generosity by one man. When investors fail to do what Hershey did, then the responsibility falls back on the government, after all, we are one community, one nation and we have to help each other until the storm passes. During the summer of 1978, Three Mile Island blew up and the school is situated only 7 miles by bird from the power station. We all got bundled off to different parts of the country to avoid any potential harm and I went to Disneyworld for a week visiting Paul Shaub. He had moved to Florida and invited us down to stay with him until school started back up. Paul also took one of the Gerz boys and me to Alaska that same year. We went by train to Seattle and then sailed up the coast of Canada by Ferry. It was an amazing trip for a young kid like me. We landed at Skagway and then hiked across the Chilkoote trail into Canada returning by train to Skagway. While in Skagway, they let me gamble at the pretend saloon. I won $50,000 playing Baccarat with fake money but unlike my father, I never had the urge to gamble so did not pursue
my new found career opportunity. It was an adventure that I will never forget and for a poor kid from Philadelphia, a fantastic experience. Now, the travel bug was firmly planted. While at Hershey, I completed my Eagle Scout and played on our intramural volleyball team. We won two years in a row but the third year we only took second place. Like the Stanley Cup, if we had won a third time, we would have kept the school trophy. We also played a lot of softball, touch football, and skated on the weekends. During the summer, we had free tickets to Hershey Park and in 1977, I got to ride the Sooper-Dooper Looper, the first roller coaster to go upside down. Pretty scary at first but after three years, I grew tired of amusement parks. In the winters, we trapped muskrat and fox to earn some money. I wasn’t very good at it and only ever caught two muskrats. I left my traps to the next students who followed behind me. It was an ideal life with nothing to want for, a school worth a gazillion dollars, and good friends and companions. Lee wanted badly to be a baseball player. Howard was a pretty smart guy but a late bloomer. Bryce was the ladies man and looked 21 so he spent most of his time dating older girls. Fred and I were competitors whereas Scott, his brother and I were friends. Jimmy was always sick and a little too uptight but a good friend. I had many friends at school and often reminisce about the good times. I have to confess that I wasn’t a model student. It’s not that I couldn’t do the work or didn’t try, it’s just that the classroom wasn’t very challenging. I joined the Spartan Players as a stage hand and quickly moved up to stage manager. Every time a show or speaker came to the school, I got to get out of class and take care of the sound, lights, and other issues. Frankly, I think I spent half my day on the stage doing stuff and the other half in class. George Hollich was our student adviser for the drama club and I have to say I decided on teaching because of the example he set for me. He was tireless in his devotion to the students and always ready to help
when asked. Colonel Prescott was our history teacher and he provided an interesting contrast to the other teachers. He was a civil war buff and he humored me with my many questions. I toyed with going to West Point and he encouraged me. During my senior year, his 16-year old daughter came down with brain cancer. He was in bad shape so I asked some friends of mine to come over to the hospital with me and we prayed for her. Shortly later, she recovered and I took her to the senior ball. During the summer before my senior year, I worked at Scout camp all summer up in Perry County. I had a great time and learned a lot. I was only 16 but I had a lot of responsibility. I chose to do the same again two years later during my college years. The one thing I missed later in life was the camaraderie that Scouting brings. I was too busy later in life trying to make money to take the time for Scouts and that is another regret that I have. Once my senior year started, Mr. Fischer, the principal came to see me. He asked me to get better marks for two semesters in a row so I could be on the National Honor Society. I told him okay and did it for him. The class always assumed that I was a really smart kid because I had skipped a grade but the truth was, I was just more street smart than they were. Dave Hawthorne nearly maxed out the SAT, so he became the smartest kid in class that year. Toward the end of my senior year, a friend from church, Greg Newell, asked if I would like to work with him in the Governor’s office as an intern. I was only 16 and I thought it would be great fun. For three weeks, I went to Harrisburg, up the private elevator, and prepared a brochure for the participants in Governor Thornburgh’s upcoming Asian business trip. Greg was the Executive Secretary to the Governor and for me, it was one of the more exciting moments of my childhood. My experiences there led me to seriously consider a political career in the future. I might have continued working with the Governor’s office over the summer but Greg was called
upon to work on the Reagan campaign. That was disappointing for me but children experience many disappointments, why should I be different. However, my later experience with the Army in college put the kabash to a political career and I endeavored to pursue more lucrative activities. Graduation was a sad moment for all of us. I gave the Salutatorian address on the stage I had managed so many times in the past. The stage is enormous with a full orchestra pit on hydraulics and about 2,500 seats. You could easily fit a Broadway stage show there and it could be a little overwhelming for a kid, but after three years I marched up on the stage and gave my speech. Each year, a distinguished Alumni gets an award and their picture hangs on the corridor wall. Someday, I hope my picture will be hang on the wall as well. Usually, it is given to successful businessmen but maybe they make an exception for Presidents. Let’s not let dreams jinx reality. My best friend, Paul, came up from Philadelphia and that was the last time we spoke or saw one another. For me, graduation really was an end of one life and the beginning of another.
Chapter 4 - College Years
As I walked down the stairs of Founders Hall, I literally had an open road in front of me. I had applied at two schools and was accepted at both. I decided to go to Dickinson College instead of University of Pennsylvania for two reasons. The first was that Dickinson was a small school and I could continue with my friends in Scouting. The second reason is that whereas University of Pennsylvania had a better program, I wasn’t ready to go to a big city on my own. The only problem was what to do for the summer. Instead of going back to Scout camp, I decided to work for a family from church doing yard work, the Weinbergs. The Weinbergs invited me to live in their home which was very generous and then take care of the yard work on a mini-farm of about five acres. I really enjoyed the work although the money was a little light. It was also a bit of a cultural experience for me. Growing up in Philadelphia, I had had a number of Jewish friends but I had never really gotten to know what it really meant to be Jewish other than from a few bar mitzvahs that I had attended. The Weinbergs had converted to Christianity a few years before and attended our church but had retained much of their previous Jewish customs out of habit. Whereas, they no longer maintained a kosher house, I was probably the first person to put ham in their fridge. They had a lovely daughter my age and I realized I was getting too interested, so that coupled with the realization that I couldn’t earn enough money doing yard work, caused me to seek alternative living arrangements. Another family from church, the Todds agreed to let me live with them for the summer. Living with the Todds was an eye-opening experience and warning for my future. Mrs. Todd had been a human adding machine for an insurance company prior to electronic adding machines. She had the unique ability to add numbers in her head and retain them providing quick calculation of sums for the company. Once the company found a cheaper electronic
means, she was downsized. Personal computers were only emerging at the this time back in 1980 and I recognized how powerful they would be in the future just by comparing the experience Mrs. Todd had with her own employment. Following up on my intuition led me to getting my job later at Shanks but that can wait for a few chapters. While living with the Todds, I worked at the Dutch Pantry Restaurant in Harrisburg. I had the wonderful job as dishwasher, occasional waiter, and clean-up boy. It was not the most inspiring work but I managed to save some money for college and learned a little bit about working in restaurants. A few weeks before summer ended, I returned to Scout Camp for a twoweek leadership camp and worked as a cook. One might say I was evaluating a new career because when I finally got to college, I had to work in the cafeteria as a dishwasher for the entire year. College was somewhat anti-climatic once I arrived. I had been living away from home for 3 years at a boarding school and now I was living in a new one that was actually much smaller in size. The one immediate benefit was girls, lots of them, and living in a shared dormitory was a definite improvement over living at a mostly all-boys school. Much to my displeasure, I ended up in a room with three other guys and it was a little more crowded than I was accustomed too. My new roommates were Jeff Thomas, Dave Clarke, and a pothead. I don’t remember how long our drug addict lasted at Dickinson but I remember he was high on something every day we were roommates. Don’t get me wrong, if people choose to get high, that’s their business, I suspect I got some second hand smoke as part of the bargain. Dave was a pretty serious guy, whereas Jeff wanted to play the guitar and chase girls. For myself, I was going to study and be a Biblical scholar and I wanted to dive right into it. I had this stupid notion
that I could take six courses a semester and finish a year early. After nearly bombing my first semester, I decided that that might not be my best strategy. One of my dreams in High School was to go to West Point. The leaders at church had talked me out of it expressing that killing people for a living was not really the kind of work that good Christians did. I saw the Army through the eyes of civil war writers, a gallant enterprise for those who loved their country. I read stories about military heroes like Patton, Pershing, and Lee endlessly as a young teen. John Kennedy’s PT Boat story inspired me as well as many hours strolling through Gettysburg trying to imagine charging across the fields into the onslaught of grape fired from booming cannons. As I roamed around the various clubs to decide which ones to sign up for, I chanced upon the ROTC table and without thinking signed up. I needed mom’s permission because I was still 17 but mom gave it and I was in the Army. Well, more like the Boy Scout version than the real thing. During my first year, I concentrated on my major, Jewish Studies and my minor Anthropology. I did miserably in Hebrew and really worried that I might have to take French. In hindsight, I should have taken French and gone for the easy A’s. My Hebrew improved little by little and so did my grades as I started to get into the swing of it. As a student, I was both young and looked even younger. It’s kind of hard to compete with the upper classmen in that type of environment. I was in two clubs, the drama club and the Public Affairs Symposium (PAS). I had hoped to meet some nice girls in the drama club but they were out of my league so I chanced to meet a funny young woman in PAS, named Laurie Weiner. It so happened that she was also a cousin of the Weinbergs. I often wonder if she is a cousin to another famous Weiner. That opened the door to a potential friendship and we started to semi-date but given my lack of experience with girls it didn’t quite get very far. The other problem was that I was getting good
vibes from some fun girls that were seniors and began thinking with another part of my anatomy. I won’t bore you with the details but my eighteenth birthday was memorable. My first year ended and I headed back to Scout camp because where would a guy like me go without a real home and needing a break from a very grueling year, back to Scout camp. I spent the summer working at camp and had another great summer. We had a bit of a labor dispute in the beginning because there was some extra work that needed doing. That was one of my first experiences with a strike. It was short-lived. I had been coming up on the weekends because I was active in the Order of the Arrow so I had maintained my friendships there. I worked as the Assistant Director for the summer camp and spent most of the summer managing the camp store and the Archery range. I attended the leadership camp again at the end of the summer and that was my last summer in Scouts because the next summer I went to Jerusalem. The Army gave me a scholarship, it seems that President Reagan needed more troops to rebuild the Army after the Carter years. The Army was pretty sad back then because after Vietnam, it was hard to get people excited about it. The maintenance budget had been savaged and nothing seemed to work. We had an opportunity to fly to Boston and go through a miniRanger course doing rappelling and having fun for a weekend. We departed for Harrisburg airport but when the C-130 arrived, one of the engines had blown out so we waited for the next Guard plane. The second one arrived without a co-pilot’s seat, and finally the third one arrived and we left after about three hours standing on the tarmac. When we arrived in Boston, we took an Army bus that broke down on the way and we had to wait another two hours for another bus to come get us. Eventually, we made it and had a great time. One of the cadets on guard duty before me fell asleep and the Colonel was not amused when he woke me up for my shift.
Normally, when one is in ROTC, you spend the summer between sophomore and junior year in training. I was a little young so when I asked to delay it one year to let me go to Jerusalem for the summer, I think they were relieved. I went to Hershey and begged them for some money to pay the fees and then asked my grandfather for some pocket money and away I went. It was a great summer of laying around, reading books, talking, and having fun. I arrived in Tel Aviv and stayed at a hostel for a few days before heading up to Jerusalem. I met a nice chap who promptly stole my camera later that night from our room. That was an interesting way to start the trip but I was not to be deterred and road up the highway on a bus imagining what it was like during the war for independence. Israel had just started its summer campaign in Lebanon and when we arrived at Mount Scopus, the campus was mostly deserted. There weren’t many Americans so I hooked up with some Brits and spent the summer refining my British accent. I am sure they had a great laugh at my expense but they were the best of friends. David was a radical anarchist, Davina was the loveliest of companions, whereas Jo and Adam spent the summer snogging. I don’t recall calling it that at the time, I learned that term from Harry Potter. Every day, I would go running in the Judean highlands imaging that I was living thousands of years ago. It’s easy to get mentally lost in the desert with no reminders of the present to wake you from your reveries. I ran in the afternoon because the temperature dropped quickly and the water would be hot in the showers when I returned. We had co-ed baths so I often got surprised in the shower when a troop of girls would come in by accident. It could have been worse, it was usually more embarrassing for them than me. I was supposed to have a roommate but he had been called up days before the summer started to fight in the Lebanese war. I didn’t learn much Hebrew that summer but I gave it a try. The most memorable event besides traipsing around the Galilee during break was a small
meeting that I attended. A group of us went to listen to Rabbi Maher Kahane speak. David had invited me and I didn’t really know who this guy was but I thought I’d go, we had just watched Rocky Horror a few nights before so I was in the mood to go out again. I listened to Kahane speak for about an hour and he answered questions from the audience and to me his ideas were nothing less than earth shattering. Until that moment, I had been rabidly pro-Israel and when I walked out the door, I had changed 180 degrees. Not because I had found what he said to be particularly offensive just so blindingly obvious. Kahane believed that Israel would never agree to a two-state solution to achieve peace. He believed that Israel needed to boot the Arabs out of the West Bank and annex the entire territory. Back then, that was radical thinking and Kahane was thrown out of the Knesset for it. As a scholar of Jewish Studies and after spending a summer there, I realized that he was right but as an American that recognizes the rights of all people and all religions to share the land, I could not succumb to his siren song. Instead, I decided that I could not support this idea in any way and began to support the Palestinians, not because I thought they were right, just because I could not accept the Kahane solution. Fast forward to today and the Kahane banner has been picked up by Avigor Lieberman and is more of reality today than it was then. One of the downsides is that I no longer considered living in Israel and any romance I might have tried to develop with Davina was put aside. Davina is a truly great woman and I should have not been so shallow in my thinking but I was young and dumb. The entire episode soured me on the two-state solution. Having traveled extensively around Israel and having seen the problems first hand, I see no way that you could return the refugees to Israel without causing a civil war or returning them to the West Bank because the infrastructure could never support them. It would take 10s of billions to relocate them there and
then where would you find the water? Further, there is almost no industry on the West Bank and while we talk about the wonders of a service economy, it’s not realistic for Palestine. Bifurcating the land leaves the Palestinians with no jobs, little water, and constant internecine warfare between the various factions and tribes. Joining the two lands eliminates all those problems and provides a ready capital base to create new industries. Israel could make the desert blossom twice. The only fly in the ointment is the Zionist aspiration for a Jewish state. Israel needs to be like America, a land for all people and all religions. It works here pretty well and I think it is time for Israel to adopt our model because their government is meshuggas. During the summer, I got a great tan, the first and only great tan I ever had. When I returned to school, I was so dark and bleached that my friends did not recognize me for several days. I played along, sat at the table with them like a stranger, and then finally asked my buddy Scott why he wasn’t talking to me. It was good fun being back from my summer adventure. My tablemates were Scott the environmentalist, Cliff the dentist, Laurie the sheep farmer, Harold the computer guy, and a host of girls from one sorority that I dated and will not embarrass them by naming them. That’s not a misstype, I think I dated about a dozen girls from that sorority over the span of four years. I wasn’t a very reliable boyfriend. Things began to change in late October though. I went for my Army physical and the Army doctor asked me a question that completely blew me away. He asked me if I ever had any homosexual contact. He was embarrassed as I was and I didn’t really know what to say. There was no question my babysitter experience qualified so I said, yes, and explained. He said forget about it, it’s not important don’t mention it again, but that’s not the kind of guy I am. It ate at me all semester. I had lost my foundation in the church because I realized after my Geology classes and studies of lake sediments, learning that the Bible was completely
mistranslated from the original Hebrew, and just having my vision expanded beyond the circular logic of the church, that the Earth was not 6,000 years old. My sophomore year, I came to a
realization that my devotion to church was beginning to fade. It wasn’t that I had stopped believing in God, just not religion. When you read the original Hebrew, the first sentence in the Bible is mistranslated. It goes downhill from there. Realizing that I wasn’t going to make a career in Biblical Studies, I started studying Economics to ensure I would have a job later in life. The Colonel had gone on a trip for the Pentagon and left the Major in charge. We got a telex that there were some openings for training in the Army. Two slots opened were open at Airborne school in Benning and one slot at Ranger school. I jumped at the chance to go to Airborne school and worked it out with my profs to take finals early and went whereas one of my classmates went to Ranger school. Airborne school was physically intense but fun, my helmet number was C106. We had to run every day and after two weeks, shin splints were killing me. If you didn’t finish PT, you couldn’t jump so I decided to find away to skip PT. I insulted the drill instructor and he had me digging in the sand, it got me out of running and gave my shins enough of a rest that I was able to finish my five jumps popping aspirin. My first jump, I was second out the door behind this really big Indian. He was scared to death and his fear like Lisa’s fear in kindergarten gave me the courage to follow him out the door. My third jump, I was the first out the door and carrying a backpack between my legs. I hesitated, so the jumpmaster helped me out. I banged my arm on the side of the plane a little but no damage to me or the plane. The fourth jump was frightening. We had high winds and I did a three point landing in sticker bushes. The stickers caught my shoot and kept me from being dragged across the ground. My CO wasn’t so lucky and got
knocked out. I had to grab his shoot and revive him. We lost 11 guys that day to injuries but the fifth jump was uneventful and we headed home. My classmate at Ranger school bombed out and the Colonel was furious with us. I had started dating this incredibly talented singer and songwriter. She was a freshmen and I was a junior. Mary Thea spun my head and I was crazy about her. She decided that I was mentally messed up because I had gone to Hershey. She had read somewhere that the children there were suffering from lots of mental trauma. She broke up with me over that and I was pretty down. I was still coming off the highs of Airborne school but my break-up with Mary Thea caused me to do a lot of soul searching. I realized that the lie I had told the Army doctor was going to be a problem in the future. I would never pass a lie detector test and I really believed that adage of duty, honor, country. If I had continued in the military then I would be violating my oath to be honest, so I wrote a letter to the Colonel and explained that we had a problem. He sent me to a shrink in the Army who decided that I was very effeminate because I crossed my legs in the interview. I guess real men don’t cross their legs despite that fact that it is a show of confidence in sales training. He recommended I be let go and dumped out of the program for maturity issues. My teenage dreams of serving my country were over but the Earth keeps turning and I moved forward. Later, I got angry at the Army and tried to enlist in the Marines but they were not interested in immature former cadets either, despite their desperate need for Arabists. Hebrew is like Arabic in structure and I had maxed out on the tests for training. There is no reason to limit the rights of any citizen to serve their country to the best of their ability. The ending of DADT comes 30 years too late for me and I am not even gay. President Reagan’s attempt to prove he wasn’t gay to his supporters provided no benefits to the military and violated the rights of many
Americans to do their duty. With all the problems our nation has faced and will face, we need to utilize every resource at our disposal, that includes gay servicemen and women, handicapped individuals, and even seniors if necessary. I am not one to dwell on setbacks, so I got on with life. Realizing that I was losing my scholarship, I went to school over the summer and finished my senior year early. I was one course shy of a triple major because I never could get up the courage to take Archaeology and memorize all the bones in the body. I didn’t receive my diploma until that summer when we held commencement. Senior year was a disappointment and I was happy to leave and get on with my life. With nowhere to go, no money, and a job market that looks a lot like today (2011), I headed home to mom’s. She was living in a mobile home park with my brother in a small trailer and I got to share a room with my brother, more like a closet than a room, thus ended my first college experience.
Chapter 5 - Banking Career 1984 was a difficult year for America. At that time, unemployment was like today, although unlike today, there was no housing crisis. This crisis was called a commodities recession and was brought on by the anti-inflationary policies that were responding to the stagflation of the 70s. It’s a bit like driving a bumper car at the funhouse. Despite being considered economic sages, Paul Volcker and Alan Greenspan have precipitated crisis after crisis. In the case of Alan Greenspan, he refused to pop asset bubbles pretending that monetary policy had nothing to do with their causes. The 80s, 90s, and 00s saw bubble after bubble impact on the economy. Given the dearth of jobs, I was very concerned with finding one. I had to help mom with rent and I knew I would have to start paying student loans. When I was offered a job by ITT Finance, I took it. ITT Finance provided consumer loans at very high interest rates. It never made sense to me why we charge people who can least afford it the highest rates and the people who can most afford it the lowest rates. I get the whole risk ratio idea but in truth, when you lend people money at exorbitant rates, you are creating a debt trap. Here is how the trap works. Somebody comes in and borrows $5,000 for a car and you book a loan at 20%. Under the rule of 78s, you front-load the interest and the first 6 months or one year is almost entirely interest payments. If the person pays off the note early or they refinance, the effective rate is more like 40 or 50%. The best thing to do was flip an account. This was the practice of getting the customer to refinance every 6 months to one year. You would advance them a little bit of money to cover some bills and they would refinance the balance with you and they would never pay the note off. This way, you could earn 40% on the money instead of 20%, all perfectly legal but terribly unethical. When borrowing, one needs to take out a loan that accrues interest monthly so each
time you pay, you pay down more of the principal. That way you only pay the stated interest rate of the loan. The other great activity we did was sell life and accident insurance. Each loan we issued, we were tasked with providing insurance. When somebody is desperate for money, they will sign just about anything. In the industry, this was called packing. I was required to get my insurance license within three months of getting hired or I would be let go. The first time, I took the test, I failed but the second time I passed. I had been out drinking the night before and I woke up late. I jumped in my car and drove at about 80 miles an hour to get to Harrisburg to the testing center. I arrived 5 minutes late and still managed to pass the test. I credit the adrenalin high that I had. The only other time I drove that fast was when my British friend David came to visit and we were late for his train. Speeding is not something I make a habit of, although I always enjoyed driving the 700 series Beamers at about 75, very comfortable. Now that I had my insurance license, I could make loans and pack them. We were expected to sell three insurance contracts for every loan we closed. My second manager, Dan was a pro, he could get people to sign up but I was always below quota. I was closing about 15% of my loans with the insurance because I thought it was unethical. We also had to sell a Thrift club membership which I thought was a complete waste but they were only $5. My quota was five a month and I just paid for them out of my salary rather than steal money from people in need. Sam was our boss and he was constantly on us to boost the numbers. His boss was Jake and they were on the phones everyday checking on progress, loans booked, past due money collected. It was a racket. My other responsibility was collecting past due accounts. In a way, we wanted people to fall behind so we could flip them. The best ones were the big notes secured by real estate
because there was little risk of losing money. I spent every day calling people at home, at work, at the neighbors, you name it, I called mothers, brothers, sisters. We had a special telephone directory which had all the neighbors’ phone numbers so we could trace somebody down. Cutting your phone off was not enough to escape us. Every couple of days, I would have to go visit people. If you were 45 days past due, I went to visit your house. I especially hated the holidays. I would have to tell people, their loan contracts didn’t make exceptions for Christmas and I knew that some child was going to have a lousy Christmas because of me. People were hurting and I was making things worse. A couple of times, I had people pull guns on me. One guy came running out the door as I pulled up brandishing his gun. I decided maybe it was a good time to leave. We didn’t have car phones so I had to pull off at payphones to call in with my progress report. Dan let me slide on that one. I worked there until April. Once, I realized the consumer finance business wasn’t for me, I started looking for other jobs. I applied at all the local banks and eventually, I got offered a position at Farmers First Bank. I was hired with a friend, Craig and I couldn’t wait a minute to get out of ITT. I was in such a hurry that when I typed my resignation letter, I left the rough draft on the desk next to the typewriter alerting Sam to my quick departure. With my job at ITT, I found new independence. I could afford a small apartment in Mount Joy on Pink Alley. I got a lot of ribbing about that one. It was basically an efficiency above a garage but it was mine. I lived there for several years until I upgraded to another place in Mount Joy with my best friend Scott from college. I had occasional girlfriends but I was stuck in a three-way relationship with two college lady friends that wasn’t going anywhere so I wasn’t very happy. Eventually, I threw up my hands and started looking closer to home. I ended up dating a married woman much older than me and that was another minor mistake. She went
away for a short period and came back pregnant and wanted to continue the relationship. That really didn’t square with me so eventually I had to end it. That was the first and last married woman I ever dated. Life is difficult enough without making it worse. My first few weeks were interesting at the bank. I had to go through a management training course but it was as much an acculturation process as a training process. One week, I did nothing but code checks with the proper values using a ten key pad. That was amazingly dull work and important to remember when criticizing the back office. I worked in about 10 different branches for the bank at different times. When I became a loan officer, I could make loans up to $5,000 and for amounts above that, I had to get approval from my boss. The assistant manager could make up to $10,000 and the manager could make up to $15,000. With the next level’s signature, the manager could get $50,000 approved. Loan committee could approve loans up to $250,000 and the board could approve loans above that. When loans went above $500,000, the bank looked for another bank to share in the lending. One can imagine how difficult the process would be if you wanted to start a business. When borrowing money, one needs collateral. The most obvious collateral is a house. If you have equity in your home, the bank will lend money based on a second mortgage up to 80% of the value of your home. Sometimes they will lend based on car titles or equipment but only up to 50% of the value. That means if you want to start a business, you have to be a home owner with equity. It does not take a rocket scientist to understand that when housing prices are falling and people are going under water that banks aren’t going to lend. When people in Washington talk about bank lending, they mean loans for big companies, not small ones. If the bank lends money without equity, it has to set aside additional reserves and charge a higher interest rate for the additional risk. When banks are making money hand over fist lending to real
estate developers, lending to small business owners is just too risky. Remember nine out of ten businesses fail in the first five years. Banks are not in the money losing business so the adage that banks only lend money to people who don’t need it is true. My biggest problem at the bank was my youthfulness. When I started working there, I had just turned 22 and looked 16. I was a loan manager working for Sue Long in the same branch that my childhood friend Paul Shaub managed before moving to Florida. That was pretty ironic. When I was promoted to Assistant Manager, I was transferred to the Strasburg branch where Buddy Ross was managing making agriculture loans. Buddy was a great boss, not that Sue wasn’t and I learned a lot from both of them and have nothing but the deepest respect and regards toward them. Unlike ITT, the staff at Farmers were interested in helping people and we didn’t practice the same predatory lending practices as ITT. To my credit I think I only made two bad loans of any consequence. One was to a former boss who ran a gift shop. He owned his home and wanted to expand the business or so he said. It turned out he had AIDS and needed the money to cover his medical expenses. For some reason he wanted to put an elevator in his house and the house was all tore up. When the house was foreclosed it was in such bad shape that we couldn’t get the money out. The bank lost $15,000, lesson learned, friends can lie. The most influential member of Farmers First on me was Alan Over. He was the area manager and a mentor as well. Early on during my training process, I sent him an email and used the word scrying. That’s a pretty esoteric word and not one commonly used in business. He insisted that I had made the word up. I went to E-Town’s library and found an oversized dictionary and photocopied it. His point was that I had to temper my word usage for business communications. That’s something I didn’t learn at university but I learned it from Alan. Alan
provided me with good advice and set a pretty high benchmark for ethics. Whereas, some bankers on Wall St might be lacking in ethics, the same can’t be said for small town bankers. One day, when I was learning about pension fund management from one Bob Lutrell , there was a commotion in the next office. I didn’t quite understand it but apparently Woody, one of the VPs had just fallen over dead. I knew CPR but by the time I got there, someone had gotten Craig who proceeded to bring Woody back to life. I think Woody would have gotten up and walked out of the office if they had let him, truly amazing. Until I started to live in Africa, that was the closer brush I had had with death. In Africa, death is a common neighbor. Part of my job was working at the different branches as a substitute manager. That was sometimes annoying because I had to try and remember procedures at different branches. Invariably, I would forget something and set off alarms or insult someone but it was fun at times getting out of Strasburg. Ag lending is seasonal and when out of season, really boring. One time at the Park City mall, a bank robber came in and held us up. I knew something was wrong but I couldn’t figure it out until the man left and my teller was in shock. When the police came I gave my description and missed the fact that he was wearing sun glasses, so much for eye witness testimony. He didn’t get much and this was his 20th or so bank. Eventually, he got caught as they always do. I tried dating the teller but she didn’t want to go out. I didn’t press the issue, I’m no Herman Cain and chased after this hot Puerto Rican girl who worked at the Buster Brown shoe store part-time. At the time, Miriam was 28 and I was 25. I liked older women and she had long black hair and dark skin. I went over to Buster’s and got up the courage to ask her out and she said yes. Three months later I asked her to marry me, about four months after I had stopped seeing my married friend. Life is funny that way. We didn’t have much money and Miriam wanted to
move into a house when we got married. I showed her how to buy a house on a credit card. When friends of mine had to leave town, they sold me their house on an installment mortgage and suddenly we were not only home owners but we were real estate magnets. My first son, Jordan was born almost a year after our wedding. We held the wedding in St. Joseph’s in the seedier side of town. Miriam was in love with the church and wouldn’t be dissuaded. It was September and the weather was wonderful except for the rain. I had been working like a crazy man on the house and Miriam and I wanted to save money so we had the reception at the house with the yard set-up with lovely garden furniture and rain, best laid plans. When we were saying our vows during the service, I made the mistake of looking at the Priest and Miriam yanked me a little and everyone laughed, that was a telling moment for the marriage. I tried to adapt to life in a Hispanic household but it wasn’t easy. Her brothers were not the best examples of the American work ethic. One brother was in and out of jail for child support. He was a wonderful father but he had a drug problem. Another brother was seriously into drugs and eventually died from their use. Her other two brothers were more responsible but just couldn’t always get up after a night of drinking and would lose their jobs on a regular basis. Miriam tried to distance herself from the Spanish life and I felt some concern by her need to be more white, to fit in, and assimilate. We each have our own demons to torture us and wanting to be something you can never be is one demon I never wanted. I guess that’s easy to say when you are white. Jordan was born the next year in August and everything changed. Having a baby changes everything. If you can’t afford to devote the time, don’t have one. I was working fulltime at the bank. We had two homes to fix-up and tenants to find, I was working part-time to help with the bills. Thankfully, I had finished my course at Elizabethtown before the wedding or
I might not have finished it. Getting a MBA was out of the question. I talked to Miriam about going to Thunderbird in Arizona. She said that I could go but she was staying in Lancaster. I swallowed my desire and put my nose to the grindstone. Miriam worked for the state and she was not going to leave. She had registered as a Republican to get the job at the transportation department. She has been doing the same job for thirty-years, I can’t imagine how she does it. The only problems Miriam and I had were money problems. We would argue but make up pretty quickly. Miriam’s mother suffers from what I assume to be bi-polar disorder and Miriam has inherited it. Before the babies, things did not get out of hand but after the babies came, I learned the meaning of post-partum depression. I can’t imagine the difficulties women face. First they have to carry a baby for nine months with all the physical problems, then they give birth to the baby and their body goes nuts for four to six months. My brother’s wife Kathy was stuck in bed for 6 months because of a blood type problem, where did RH negative people come from? The post-partum depression set-off the bi-polar issues. After our second baby, I began to lose patience, my character flaw, impatience. The deal at Farmers was that when one manager moved on, they promoted from within. There were three of us in line, Deb at one branch, myself and I don’t remember the third. A position opened up and the bank went outside to hire someone. I was youthfully incensed and when I went to Alan to complain, he told me I would just have to be patient and wait my turn. I thought to myself, I can’t eat patience so later when I was offered a job by a local company at the same pay, I quit the bank and moved on to the next stage in my life.
Chapter 6 - Shank's, the Early Years Impulsiveness can sometimes be a character flaw and other times it can be a strength. Leaving a cushy job at a bank to be the office manager for a small local manufacturer may seem like a foolish decision if one only thinks of corporate America as the only path to success. While working at Farmers, I attended classes at Elizabethtown College, finishing a diploma in Business Administration for executives who had a Bachelor’s but in a different major. During my last year at Dickinson, I had asked the President, Sam Banks, why Dickinson didn’t offer a business degree. He looked at me like I had said a foul-word and replied, “this is a Liberal Arts school not a technical school.” The general feeling seemed to be that business is not a worthy subject of study. I learned that it may not be as challenging as learning Arabic but understanding how business is done is just as important in life and doing business well is an art not something learned in a textbook. My wife, Miriam, was not amused by the change in employment. She felt that I was giving up a wonderful opportunity but I saw something different. I saw a company that was poised for expansion, it just needed some intellectual energy and risk taking to move beyond its parochial perspective. Shank’s is a flavor manufacturer and it exists in a niche that limits the number of competitors through various government rules and historical issues. That also means, it has limited growth potential as well. Businessmen measure success by growth and profits. If a company cannot grow then many might consider its ‘poor’ performance a defect of management. The owner, Jeffrey Lehman, was about 40 years old at the time and he was ready to grow. He had a young management team that wanted their careers to develop as well. That meant, growth was pretty much all that mattered.
While working at the bank, I had purchased an Epson personal computer and brought it into the office. It was more a novelty than anything else because I had limited software capability, only basic spreadsheets and word processing. I was using Lotus 1, 2, 3 creating macros and doing documents on Wordperfect for customers. However, at the time, it was a pretty impressive setup because there were only a half-dozen computers at the entire bank. The former office manager of Shank’s, Brett, wanted to move over to a sales position and he needed someone to replace him. He thought with my experience using a computer that I might be able to do the job. I had just finished my business diploma and I knew how to use a computer so when he asked me, I said sure I can do the accounting and manage the office, well at least I thought I could. My first two weeks at Shanks were some of the worst weeks of my life. I was in way over my head but like most things, if one organizes the problem, finds the path to the solution, and just puts forth effort and one will probably overcome it. At the end of the second week, I had processed the payroll, figured out all the details for accounts receivable and payables, learned how to use the software on the MAC computer, and felt like I could do this job. That’s how I solve problems now, jump into the middle of the details, find the common thread, establish the priorities, and then solve each problem as resources permit. When something is behind, no matter how important it may seem, sometimes one has to let it stay behind to stay on top of the new problems that keep on coming. To be a successful manager, it’s not what one knows, but how one manages his or her time that decides the outcome. Another thing I learned is that one learns enough about a subject to understand the basics but there are plenty of experts whom one can rely on to fill in the gaps. The time involved in becoming an expert far exceeds the benefit of taking the time to become one.
Jeff was an avid fan of Apple, not quite in love, but definitely borderline. Previously, he had been a computer salesman for IBM so if he was willing to work for a small family company then I thought I could to. Jeff needed some horsepower and I think I brought some to the company. The first thing we did was change banks. Jeff was banking at Farmers First, my alma mater, but they we charging him too much. We set up a meeting and we asked them to expand the credit and lower the rate. We had some prearranged signals which meant either negotiate harder or backoff. If I felt they were feeding him a line, I had planned to take off my glasses and wipe them while interrupting them. As it turned out, the line they were feeding him was so ridiculous that as I took off my glasses, they tumbled into my soup. I acted as if nothing happened and calmly wiped them off while redirecting the conversation. We often laughed about it later on and at the time we decided to go to a competitor Fulton Bank who had offered a 1% rate reduction. That was a lesson for Jeff because he learned that banking was just a business and bankers were really not much better than prostitutes. If a banker likes you and thinks he can make fee income, he will bend over backwards to give you as much money as you want, otherwise forget about it. Over the years, Shanks changed banks fairly often because we understood, money is just a commodity to be bought and sold. If you are poor, money has a different dimension than if you are rich or a banker. To the rich, money represents a reward or it becomes a tool to acquire the things one desires. Profits are a measure of success to businesses in the same way a scoreboard measures the success of a football team. When you deal with 100s of thousands of dollars on a regular day, money transforms into numbers, it becomes an accounting entry and loses its luster. Of course many people on Wall Street worship money for the status that it brings, the nice toys, the women, but the truth is that most business people work for the
challenge and the sense of risk, not the money. I took an ownership interest in the business and put my job front-and-center in my life, ahead of my family and everything else. It was the challenge of growing the business that peaked my interest and as it grew, I assumed I would earn more money just like a winning team accumulates goals. Even so, with two kids, and a third house that we bought at auction with a British partner, Brian Roberts, we needed more money. I had watched a number of shows on how to get rich in real estate. I took those lessons to heart and set out to build my real estate empire, me and about a 1,000 other people locally. To get extra money, I had to work part-time, so I poured concrete for patios, built some decks, drywalled the rental units, replaced the tin roofs myself with the help of my brother, and just about any other odd job I could do to earn some extra money. A friend from my banking days, Charlie Brommer, asked me to help him go into business building truck bodies, so I learned about welding and truck bodies. None of these business ventures ever went anywhere because eventually you reach the limits of growth. Without an injection of working capital, most small businesses are forced to remain small. For those really talented folk, they can attract additional capital to grow their businesses and take it to the next level. I found it is pretty easy to make a business with up to $250,000 a year in revenue but to go beyond that , you need enough capital to get to $2 million in revenue, and then $20 million in revenue and then you can go public. Lancaster experienced a housing bubble because some banks financed a real estate company that bought up rental units and pulled an Enron type deal. They would sell the units to a captured company to force up the local prices to allow them to buy more properties on their new average equity bases. Eventually, they had acquired about 2,000 properties in a market of about 75,000 properties. However, like any Ponzi scheme, they reached the limits of growth and
caused the local market to implode. Prices didn’t recover for over 10 years and I was stuck with properties that I was underwater with. Instead of achieving my dream of real estate mogul, I had achieved functional bankruptcy. I couldn’t walk away from the properties and I couldn’t sell them without taking a loss. I imagine there are a lot of people in the same position right now who did nothing wrong, just had some bad luck. I have decided that a successful business depends on luck as much as on skill and ability. One has to be in the right place at the right time with the right idea, just ask Bill Gates. I also believe that a person can make their own luck. Almost every break I have had in life has come from someone I know whom I did something for that I didn’t have to do. My wife was always asking me why I was doing this for someone and I always responded, no reason, it just feels right. Maybe it is just my nature but I feel that if I help someone, that help will return to me if not from them, someone else. Later, I found this is a very Asian perspective and part of Buddhist tradition. For me, it’s not religious, just common sense. If you build up a network of good people, you have a higher probability of good things happening. Shanks had some limitations because of the MAC computers. Jeff wanted to design a bill of materials program to help manage the inventory and formulations but a program like that did not exist for the MAC. I was pretty cocky and said I would write one. Jeff said he would pay me a bonus if I could get one written, so I went ahead and did it, I needed the money. I chose 4th dimension as a database engine and proceeded to learn Pascal and database design on the fly. After a few false starts, eventually I got a working program that I continued to enhance and later with the help of a full-time programmer, we wrote a complete accounting package with multilevel BOM functions, general ledger, accounts payable, accounts receivable. The company ran on this program for about 12 years and we used the accumulated data to help run the company
during that time. I credit our ability to keep our overhead down to employing computer power to our problems. Many other companies I dealt with always seemed to have two to three times the number of people in their offices. In the process, I really got to know accounting and the power of data management. During the early years at Shank’s, we focused on the core problems of growing the business. Jeff had decided to get into co-packing to utilize the seasonal down-time and support a larger facility shortly before I had arrived. Unfortunately, the co-packing side of the business grew faster than our resources could support and began to eat into our profits from the flavor side of the business. It wasn’t so much a problem of price or payments but growth. We were in too small a space, forcing us to use outside warehousing, which increased the amount of times material moved around the facility. Each time a warehouseman touches a good, it adds cost and we were spending all our profits moving the goods around. In the meantime, I was trying to get Jeff to vertically integrate the company. There was a tremendous cash-flow in the co-packing business so it was seductive but when you work really hard for nothing, it can ruin your day. Shank’s bought vanilla from a company called David Michael, it’s ironic I know. They were an old family company that had a strong presence in the vanilla business on the east coast. The rest of the flavors, we produced in house based on historic formulas that went back to the early thirties. The general feeling was that vanilla manufacturing had some special mystique about it that prevented new companies from entering the market. As a relative newcomer, I viewed that feeling with suspicion and pretty much considered it salesman bull. However, Jeff was fairly concerned about cutting off his relationship with David Michael and was unwilling to take much risk. Costs were going up and we were under tremendous pressure to get the costs down because of the growth of the co-pack side and the additional debt service that our facility
expansion had brought on. The first thing we did was get rid of the glass bottles and replaced them with plastic. That saved a tremendous amount of money and dramatically reduced product loss. When we designed the bottle, I suggested we make it look like one of our competitors. My logic was that we could then solicit their business. Jeff thought I was a little crazy but I won him over and we designed our bottles to look like Durkee’s. I was interested in reformulating our products so I took a chemistry class at Penn State to better understand how the chemicals worked during my evenings. I really enjoyed it and regretted having not pursued it in college. Making the change to plastic bought us a year but inevitably costs began to rise so we needed a new strategy. I was pretty sure that we could make vanilla and do it much cheaper but I had to prove it to Jeff. At the time, I had just split up with Miriam after my second son Austin was born. Miriam’s bi-polar issues really came out this time and she had started to get physical with me. I don’t believe in hitting women or any type of domestic violence but after getting slugged a couple of times my patience was wearing thin. I warned her that if she hit me again, I would give her a reason to think twice. That didn’t work out so well because I came home one day shortly thereafter to find the police at my house, Miriam had gone and slugged my mother. We tried to get back together a couple of times but things were never the same and eventually we divorced. I was pretty certain that I could get custody but I understand how important it is for children to be with their mom, so I negotiated a 10-day a month deal for me such that I got the boys for one full week each month. I never regretted the time I spent with my sons or the burden it placed on a busy executive. I looked forward to those weeks because weekends are never quite long enough. Jeff knew things were kind of rough for me so instead of a bonus, he offered me a vacation. I took him up on his offer and flew to Singapore and Indonesia on a vanilla hunting
expedition. I had decided that this was my opportunity to explore my ideas about vertically integrating. I had not been out of the country since my trip to Israel in college and I had no idea what I was doing. This was in August and the Christmas before a friendly Indonesian guy named Andyan Rahardja had come by the office. He was married to a scion of a local well-to-do family and wanted to promote his vanilla trading company. He kind of sparked the interest on my part to take it to the next level. I had contacted the Indonesian embassy and got a number of names and contacts and those early contacts paid off. My trip was not a very long one and I barely scratched the surface. I flew into Singapore and walked around gawking at all the new sites. The most amazing thing about Singapore is how much it is like America. If people drove on the right side of the road, I might have forgotten where I was and thought I was in LA. I stayed at a fairly expensive hotel, the Orchard. One of my disappointments was that there were no nightclubs at the time in Singapore. One had to pay a membership fee to get in and then the beer was fairly expensive, so I spent four nights in the hotel bar called the Library talking to the DJ. Also, most Asians at the time didn’t dance when bands played, they would sit around and watch the band, very unlike the US. I was accustomed to going out to bars, dancing with girls, and having a good time, this was a new experience and I didn’t have much spending money. Now, things are different in Singapore, Singapore has become much more American, there is gambling and a lot more prostitutes prowl the clubs. I am not sure that is a good thing, but it is what it is. After Singapore, I went to Jakarta and Bali. I stayed in the center of Jakarta and met some dealers. Most of them had nothing to sell but I did meet a young woman, Febriani who later became one of my main suppliers as well as an older doctor from Surabaya. Both of them were critical to the growth of our business so that trip was definitely worth the $5,000 we paid. I
also met another small player in Bali who owned a hotel. I often went golfing with David in Bali but we never really got the business to work between us. David was later caught up in the currency mess and despite his hard work took a real financial beating. This was 1993, and Indonesia was on the way up and for all of us, business was good. I still had one problem, how to get Jeff to move off the fence. I had achieved my first goal, proving that we could buy the raw material directly from the exporters, now I had to prove we could make an acceptable product. I spent the next four months pushing Jeff. I got him to invest in some equipment but he still wouldn’t give me the go ahead. I filed all the formulas with the Bureau of Alcohol and Firearms and got their approvals. The company wasn’t really supervised by the FDA, it was supervised by the BATF because of the alcohol content in the products. Jeff was always concerned that we were meticulous in our tracking of alcohol because we needed to go to three decimal places. At times it seemed anal retentive but in the 12 years I filed reports, I never had a problem with the BATF. One of the product lines we packaged was for the Hasidic Jewish community in New York. Every year, they needed Passover product which requires the presence of a rabbi during production. That means that they want to consolidate as much production as they can during a two-week period in February. This year, Virginia Dare, another vanilla packer decided not to do Passover production and now I had my opportunity. I put together the worst possible process for making vanilla that I had ever thought about but it worked like a charm. We took a steel tank called a tote for transporting bulk liquids and hung burlap bags full of cheap vanilla that I had bought to test from my new Indonesian friends. We added a pump, put the alcohol/water solution in the tote and circulated it for a week. The quality was awful but it was kosher for Passover and we had sold our first batch of vanilla. The sale was about $6,000 and the cost of production only $2,500, so we made money and that was the beginning of a very
new era at Shank’s. Timing is everything and our niche market was changing too allowing us to quickly expand our operations.
Chapter 7 - Growth and Prosperity Of all the products to concentrate on, who would ever consider vanilla beans? The total market in 1993 was about 1,800 tons per year. That sounds like a lot until you realize it is only 45 containers a year worldwide. The bulk of natural vanilla comes from Madagascar, followed by Indonesia and in smaller quantities from Uganda, Papua New Guinea and Mexico. The plant originated in Mexico but with artificial pollination methods developed in the late 19th century, began to take-off in other parts of the world. Prior to 1996, the Madagascar vanilla trading market was closed to all but 6 exporters creating opportunities in other parts of the world for young eager purveyors. Shank’s could not import directly from Madagascar but it could buy from Indonesia, the Comorros, and eventually Uganda. There are very few labeling regulations requiring point of origin for Vanilla or its strength and quality, so the incentive to blend other products together to lower the cost of the final product is intense. Shank’s’ customers demanded lower prices and they got them. To meet the demands of Shank’s customers to maintain price levels in the face of rising labor costs, Shank’s was forced to vertically integrate. We began construction of a new extraction facility to replace our initial requirements, about 30 tons a year. In truth, creating this size facility would have only a nominal effect on the market. We began purchasing equipment in 1994 and 1995, while I went around the country looking at other extractors’ systems. We needed to have something that had a rapid turnaround time and the ability to make large quantities during seasonal demands. Most of the systems use a modification of percolation commonly found in your household coffee makers. The problem with these systems is that they require several weeks of processing and finishing. A former company in New Jersey employed a system known as the Sheffield system that employed a hot extraction method by mixing the chopped
vanilla pods in a vodka like solution called a menstrum for 24 hours and then through a series of repetitions and separations by centrifuging could process a batch in as little as four days. Our previous supplier David Michael (DM) used a similar system to make a standard single strength product called a one-fold. After that, DM would concentrate the extract and redilute to a specific strength for the customer. That was actually a problem for us because we should have been labeling the product made from concentrate. We ended up doing an extraction at either double strength or triple strength in this system and then adding water and alcohol. Since no concentration took place, we did not have to label as such. We still needed a bridge supplier to support us in the event that DM decided not to supply us with product while we set-up our competitive system. I turned to a well-respected company in Rochestor called Vanlab and they agreed to supply us with product as well as make vanilla using our vanilla pods. Dave Patton, their owner, did not have any reason to import Indonesian beans but we did, so happily for both of us, he agreed to co-manufacture charging a basic tollcharge for each liter we produced. This allowed us to lower costs and supply growing demands for product until our system was up and running. The industry was getting squeezed and new opportunities were showing up every day. Now that we had a steady supply of raw material, a contract manufacturer, and customer acceptance for the product we went ahead and bought the equipment at auctions and used equipment dealers. Now all we needed was a ‘guru’ of vanilla to help guide us. We found a retired individual, Willis Steinitz, who had previously been President of a flavor company that employed the Sheffield system and he worked with a chemical engineer to design our system using the equipment we had purchased. Some have accused me of industrial espionage by going around and poking my nose in their facilities but what I really saw were the things we did not want to do.
Most companies were following traditional style systems and the Internet provided good information even at that time on different ways to process. I also made a trip down to the patent office and trolled through every patent related to vanilla and plant extraction, so I had a pretty good idea about what needed to be done. I just did not want to repeat everybody else’s mistakes. Given the requirements of fast turnaround and good capacities, we over designed the system and built enough capacity to process 100 tons of vanilla. With a seasonal business and with used dairy equipment bought at auction, it became cheaper to go up in size rather than keep it small. That also created a situation where we could start going after dairy related business because of the different seasons. That proved much more difficult than we expected. I often remarked it would be easier to change a dairyman’s religion than change his vanilla supplier. I started calling on Kroger in 1991 and did not get our first order until about 6 years later. Jeff called on his cousin’s company, Turkey Hill and could barely get a token order. The dairy market is very conservative so we began looking for new opportunities. Eventually, one came along when Beck vanilla was sold and Charlie Beck , the President was out of a job. We snapped up Charlie and accelerated our dairy program. During my quest to learn how to make vanilla, I struck up an odd friendship with Charlie. He knew I was fishing but I put on my dumb Amishman routine and we opened some lines of communication. I would go around the US visiting potential customers and competitors. Without any published markets or other available data on vanilla, this seemed the easy way to tease out details about market happenings. Eventually, everyone wants to show they know something. By telling people what they could find out if they bothered to look, I won some confidence with some competitors and eventually some customers. Charlie was being bought out by his family and had a leasing company. To bring Charlie on board, I invested in his
leasing company and eventually that got absorbed into the trading company. One of the ways we built up the assets at the trading company was to lease equipment. That’s a real game and a very effective way to reduce tax liability. You load up equipment expense over five years for equipment that will last 25 years and accelerate the write-off, all perfectly legal. I ended up losing some money with Charlie but I wrote it off to experience to finally settle the arrangement, I bought a Bobcat with a dozer and backhoe attachment to help me do the landscaping for my new house. I had a lot of fun with that Bobcat and I still have it with me here in Vietnam although I do not have much use for it teaching English. It just sits in a back lot getting rusty. One of the lessons I learned from Charlie is about fair weather friends. We wanted to expand our products and Charlie owned a color business. He had hooked up with some guys down in Uruguay or Argentina, I do not remember now which but they were producing a natural red color. The idea was we would import it and Charlie’s company would market it. We invested $150,000 into this color project and thought we had a pretty good program, naïve that I am. I thought we were just doing the financing but when the tests came back and the color turned blue in milk, Charlie suddenly did not have a customer. He made some half-hearted efforts but basically pulled a ‘snagglepuss’ on me and exited stage left. Charlie was part of our growth strategy so I could not go Freddy Krueger on him but I was never warm with Charlie again. We tried for years to unload that stuff and eventually they did at a big discount, Charlie, my fair weather friend. Back when we were designing our plastic bottle, I had the idea to make it look like Durkee’s. It seemed a little crazy but we started calling on them in 1994 and suddenly, Reckitt and Coleman put them up for sale and sold them to an Australian company Burns Phillips. The plant was located in Bethlehem just an hour’s drive away and we hustled up and bought all their
equipment to take them out of play. This all went through Spice Islands and Tones Brothers but when Burn’s Phillip needed a co-packer on the east coast, they naturally turned to us. We had a bottle available, the equipment to package it, and the capacity to produce extract on demand. Suddenly, we went from processing 30 tons of vanilla to processing 150 tons of vanilla and our equipment was not quite debugged. Still, we had a sharp guy in processing to manage it and he seemed to have everything under control. That is, until Hershey Foods offered him a better job and he suddenly quit. We had an order of 300,000 gallons to produce and a system that was working at 25% of capacity and we needed a miracle to get it all done. We were having a management meeting and I was sitting there listening to a discussion about production and meeting the targets and just doodling wondering about some work I was going to do on the weekend when I heard something really silly. Sallie, our production manager was telling Jeff that we would have no trouble filling the order. I did a quick calculation in my head and realized that was physically impossible. I laughed which was rude and said that isn’t going to happen. Jeff was not very amused and asked me to explain and I did. The best we could do would be about 100,000 gallons based on our current productivity and time constraints. We were going to miss this one by a country mile unless we made some dramatic changes. I proposed three shifts and seven days a week to meet the order. Sallie smiled and said it wasn’t going to happen and I replied she needed to make it happen. Jeff was not sure what to do and asked for ideas, eventually I volunteered to put my neck in the noose and make it happen. I suggested that we could get 80% of the product made by the deadline and hoped that would be good enough. I started working double shifts to get the extraction process debugged, during one of our meetings, Jim the extraction manager nearly blew-up the factory when he forgot to turn off the
steam. After firing him and replacing him with another more functional manager, Randy, we managed to get the process debugged, got the centrifuge working, and produced our 80% target. I was reminded that to get the job done right, sometimes you do have to roll-up your sleeves and do it yourself. If that means working double-shifts for six months, then that is what you have to do. That extra effort put us in another category entirely and we were now the second largest processor of vanilla extract after McCormick and no one knew who we were. Suddenly, we had economies of scale that we could leverage and offer much cheaper product than our competitors and we began to sell more vanilla. Prices had continued to decline after Madagascar opened its markets to more exporters and the industry began to unravel. Previously old staid companies were having trouble competing, forcing mergers and consolidations. For such a small boring industry the period between 1996 and 1999 resulted in over 20 mergers. Vanilla bean prices had reached new lows and we could buy product for less than $4 a pound. The sky was the limit and we began to think big. Of course that was all the fun before the storm because at $4 a pound everybody was losing money except for big integrated companies like us. Farmers could not afford to produce vanilla at these prices and began to tear out their vines and plant other more profitable crops. We had started a trading company to take advantage of these low prices and managed to buy about 300 tons a year making us the third largest trader of vanilla in volume. That volume came from someone and the two largest buyers, Zink & Triest and Vanimad, began to try and pull a Hunt Brothers move to corner the market. With declining production and stockpiling, prices began to rise very quickly and they didn’t stop. When the inventory controls came down in 1996 in Madagascar, Vanimad and Zink started a relationship but Ichbal, the local owner of Vanimad, decided he didn’t like the Todd
family way of doing business and did an end-run. Eventually, the two companies decided they were both going to control the market and pushed prices to unheard of levels. In 1997, we could buy vanilla at $4 a pound and by 1999, that price had doubled. By 2003, at the height of the bubble, prices reached $250 per pound, higher than many illegal drugs. As prices rose, customers began to panic and we had to show we had a secure supply to provide our customers with product. We opened production facilities in Indonesia to take advantage of the low prices because our dealers did not want to trade in beans. We made a production arrangement in Uganda and one in Madagascar. We were in great shape, or so we thought. The trading company was used to import vanilla as well as diversify its operations into complimentary products. The idea was sound but it is much more difficult to sell imported products when your main product keeps going up in price and absorbs all your capital. The trading company was set-up in an Enron like concept. Burns Philip needed a way to offload inventory to reduce taxes so considered selling the inventory which we would reprocess and then sell back. Clearly, it was unethical and potentially a disclosure problem and after about four months they abandoned the idea but it still worked for Shank’s. In banking, a bank can lend 50% of value on inventory without going around FED regulations. That meant that the bank could only lend 50% of the value of our vanilla bean inventory but we needed to hold six and even 12 month supplies. We were in real danger of running out of capital and growing our way into bankruptcy. However, as a trading company, the bank could easily lend 70% of the value of the vanilla and possibly even more with some creative accounting through the use of bankers acceptances. The trading company would import the beans, sell some to other companies to show that it was not a captured company, and then we could get better financing terms from the bank. This deal worked for everybody except me. We had a couple of local investors put up
some money and Jeff made a gentleman’s guarantee to his friends that he would cover any capital losses. I had to borrow $75,000 to put in my share of the capital to get ownership and I didn’t have any guarantees because my decisions would make or break the profits. I was full of spit and vinegar and thought we could do anything, my bad, I eventually lost my money, my house, and my wife and daughter. At first things were pretty good. We were importing vanilla, selling to other users, we expanded into teak wood furniture and even did a little spice importing. One of our investors was a honey packer and wanted us to import honey. I tried but didn’t have much luck getting a lower price for him, there just was not enough room for another middleman. One of the byproducts of vanilla manufacturing is the vanilla seeds. Under the antiquated regulations, the BATF required the waste beans to be denatured with kerosene to avoid anyone going into the trash and getting the residual alcohol. Another thing a company could do is dry the waste beans and remove the alcohol. Unfortunately, Sallie didn’t want to do that because it was dirty and messy so I said, I would. A French buddy of mine, Gilles, was bugging me for the seeds and I decided to set-up a drying operation in our vanilla storage area using gas ovens and a sifter. We invested about $15,000 into the process to get started and took a waste product that was costing $30,000 a year to dispose of and turned it into a $300,000 a year business. The beauty of this business was it took about three employees and generated about 85% gross. It was fabulously profitable at 100 tons, less so at 50 tons but still very attractive nonetheless. The seed business became our main profit generator for the trading company and remains so today. To improve our costs further, and to insure that we received consistent supplies, I set-up some partnerships with local players in Indonesia, one in Madagascar, and one in Uganda. Gilles was my partner in Uganda but his partnership was not exactly what we thought it was. We did
not lose any money but we got schnuckered and I learned to be wary of deals with the French. Eventually, we found some religious-based vanilla processors from Switzerland who seemed on the up and up and Jeff negotiated a good deal with them. I let Gilles slide on the deal because he was buying the seed from us and we were making good money on the seed. There was no reason to queer that deal. In Madagascar, my Indonesian broker, Andyan, knew a guy who knew a guy who set us up with Nick, a young guy from Belgium who was partnered with another Belgian school-mate. We set-up two partnerships in Indonesia, one with some real estate marketers, the Sardjitos, and another with Agus in Bali. We actually tried to run a regular company in Jakarta with full-time staff and offices. We maintained the offices for three years but when pricing pressure began squeezing the margins and supplies began to shrink, the Jakarta offices and support staff were the first to go. Agus was an unusual character. His family owned one of the oldest hotels in Bali located in Sanur. He had just returned from France and needed a business. I had spent many nights at his hotel and after some discussions, he agreed to partner with us. At the time I was in discussions with Universal Bank in Indonesia, it was May of 1997 and we had been talking for about 6 months on and off. They had finally approved a line of credit and we were going to use this line to support Agus’s efforts. It was a Sunday morning, we met for coffee at the hotel and everything was a go. On Monday, the Thai Baht began to spiral down and I got a phone call, everything was on hold. By June, everything was canceled and I had to find another way to fund our Bali operation. If not for the Asian flu, I would have had enough capital to fund our expansion and maybe my life would have been very different. At the time, I just saw it as a wasted opportunity not really understanding the implications for Indonesia and our suppliers. When the riots hit Indonesia, Jeff and I flew over to make sure our suppliers were alright. It was
amazing to drive through Jakarta and see all the broken windows. Every window on the first and second floor of nearly every building in a city of 15 million people was smashed. Our Chinese suppliers were in terror with many of them fleeing to Singapore and still others hiding out in Bali. It was a terrible time for Indonesia and I learned the meaning of ethnic violence. Most of my business contacts ended up in jail. Prior to the financial crisis, there were about 120 banks in Indonesia. It seemed at the time that 100 of them closed. Since I had been in discussions with about 10 different banks during the previous years, I watched as one-by-one my friends were imprisoned for misuse of funds, or poor investment choices. The government needed to blame someone and these guys were simple scapegoats for a failed government. Unlike the US, the government actually put their high-flying bankers in prison. The crisis was caused by a decline in confidence. The underlying values were still there the day after the crisis but the confidence was gone. This was caused by IMF demands backed by a US expectation that General Soeharto had to go. To precipitate the crisis the US demanded that the Indonesian currency remain floating. Had the government bucked the US and pegged it to the dollar following Malaysia’s lead, Indonesia would not have had to go through what it did. The currency speculators destroyed the valued of the Rupiah and during a few weeks, one could buy new Mercedes for less than $10,000. I actually tried to by 10 of them but by the time I got to the dealer, they were already sold. With huge inflation and instability, the vanilla farmers switched to food they could grow and eat causing an immediate 80% drop in production. Thus began the future shortage in vanilla that led to the bubble. We knew production numbers would be down but we underestimated by how much. Personally, I was on a new high. I met Kristen at the very end of 1995. I had been dating an attractive African American during the latter half of 1994 but her sister died suddenly and she
self-destructed in despair. I swore off women for about 9 months in 1995, but began to date again in the fall when I discovered how many women I could meet online. Wow, I loved my love@aol and I was dating three or four different women every week all across the country because I was traveling around selling vanilla. I must have dated 100 women during a 6 month time-frame. I had my old standbys, different girls I had gotten to know during my separation from Miriam, but Internet dating for me was awesome. I chanced upon Kristen because her friend had posted her name online. I was looking for a Vietnamese girlfriend, I liked Vietnam from my visits, and I had another Vietnamese girlfriend at the time. My other Vietnamese girlfriend, Daphne, had been part of an airlift out of Vietnam at the end of the war. Kristen was part of the same airlift as well. It was an interesting coincidence and I was happy that the two girls did not know each other. Kristen was working as an accountant in the nearby city of York. I was living in Lancaster at the time but had bought some land in the York area with plans to build a house. Everything seemed perfect, I was looking for a Vietnamese girlfriend, I was planning on moving across the river, so we set-up a meet. Our first date was a little strange. We met for Chinese food on New Year’s day and I found out that her birthday was that day. This presented a little bit of an embarrassing moment for me because I didn’t have a gift or anything and I was totally unprepared. She said that normally she spends the evening with her adopted parents, Ralph and Jane. After eating, I was thinking movie or dancing but Kristen asked me to go to her parents’ house for birthday cake. They had planned on having Kristen but she had canceled to go on the date with me. They lived in the countryside and it would make them happy if they got to see her, blah, blah, blah. I never meet parents on a first date but what the heck, I said okay. Apparently, Kristen did not bring many boyfriends home to visit because there was a look of shock on her
brother’s face the entire evening and while her parents put on a good face, I could see they were uncomfortable. I put on my best salesman’s smile and did my best to put everyone at ease with jovial charm. It seemed to work because they invited me back. For me, I couldn’t have been happier. Here was a girl that was single without any complications, a normal family, a good job, and cute to boot. I prefer smaller women with small tusches and Kristen’s was just right. When I got home that night after dropping Kristen off, I decided to call the other women in my life, say good-bye, and focus on Kristen. For three years, I was a pretty good Boy Scout. I stayed away from other women, stayed out of the bars, got a super-environmentally friendly house constructed, built the trading company, traveled around the world making deals and in May of 1999, we got married. We were struggling to get by on our incomes but I was pretty confident based on the success at the trading company, the trends, and no one was going to pop my balloon. Audrey, our daughter, was born the following April. Had I known that our lives were about to take a turn for the worse, I would have done things differently but I am not a fortune teller and had no idea my life was about to turn into a monumental nightmare. Things were going great at the trading company. We were processing the seeds, we had vanilla at an average cost of $7 a pound, a full order-book, importing new products, and then our suppliers began to get squiggly. Whereas prices began to run-up some in 1999, they began to accelerate in 2000. I stayed close to home in 2000 because of my daughter’s birth. I wanted to be a good father and a good husband. When Kristen returned to work after her pregnancy leave, I took Audrey to work every day for three months until she was really ready for daycare. Most of my work was on the telephone and managing the office. We had too much vanilla and the bank was getting nervous, prices were going up 10% and we had a profit opportunity, so we
started to sell some vanilla. In hindsight, that was pretty dumb because vanilla prices were up 400% within a year. We had never experienced sustained price increases only decreases and felt this was just a minor fluctuation. The first sign that there was trouble was when Nick in Madagascar could not buy any product. I flew to Madagascar and confirmed the shortages and higher prices. Andyan had made an oral deal, then backed out with one of the big players who decided to sue for their lost imaginary profits. They never had a case but an ambulance chasing attorney ran-up the legal fees. We got caught up in the case despite there never being any connection with us and it was one of those moments when you regret the ability of people to sue with impunity. We still had enough vanilla stock for a year so we were not particularly worried but we did not anticipate prices sky rocketing. By the middle of 2001, we discovered Nick had gambled away some of our money and he was short $150,000. Things were beginning to unravel and I started looking for alternative products for the trading company because we were losing sales as prices for vanilla started to climb. As we lost extract sales, our production of seed dropped because it depended on the waste stream providing a double whammy to our net profits. Instead of being comfortable, things began to get very tight. We needed to cut costs so we pulled in our horns and abandoned the Indonesian market. Production was very thin in the smaller countries and there was not room for another player so we focused on Madagascar. It was painful to close the Indonesian operations but we had no choice. I abandoned nearly 10 years of effort, friendships, and relationships because two grown men were acting like children. It was March of 2001 and I had just flown into Madagascar.
Chapter 8 - The Vanilla Wars The time between 2001 and 2005 were the unhappiest years of my life and I share the blame equally as much as the people that brought me misery. After all, I was a willing participant allowing my ego to overstep my common sense. During the summer of 2001, vanilla prices were starting to rise and supplies were tightening up. We felt that the company was covered but to be sure, I needed to constantly check on the goods in overseas warehouses. Suppliers would constantly ship us inferior product necessitating rework and reconditioning. I developed some procedures such as throwing the beans in a washing machine to remove bad odors or cooking them in an oven to dry them. To improve our operations we set-up a room filled with washing machines and dryers to clean the poorly processed beans. It was really strange, as price increased, quality decreased and we were left in an awkward position of charging more for lower quality products. I tried to do my best and in September of 2001, I flew to Indonesia for a few days to check on product and try and source some new products. I was waiting in the terminal for my flight to New York killing time by watching CNN when suddenly a plane crashed into the World Trade Center. Then I watched in shock as another plane crashed into the other tower. I immediately called my boss, Jeff, and I told him to turn on the TV because we were going to war. People talked about where they were when JFK got shot, now people will always remember where they were when the towers got hit. My flight was canceled and I ended up staying another 4 days in a hotel in Singapore waiting for a flight to JFK. When I finally arrived in New York, the pilot made sure everybody could see the smoke and it was one of the few times a flight arriving in New York has been dead quiet. When I went for my Rodeo in the parking lot, it was sitting by itself in the middle of an enormous empty lot. I never want to experience that
again so like most Americans despite my misgivings, I supported our troops in their new war. While American troops were fighting their war, I was fighting the vanilla war. There were a number of players in the industry at the time but two characters stand out, Ykbal and Henry. Both of them had something to prove and I was getting in the way of their efforts to control the market. Vanilla, like many products, was controlled by an oligopoly of friendly competitors. Everybody knew their place but nobody became serious about competing so everybody made high profits. Ykbal and I were the new boys in town and we wanted our slice so we began to cut prices and squeeze margins. In a product with small volumes, that is not something you want to do because everybody starts to lose money quickly so then everybody starts to buy up product because if you have the product you get the sale. Ykbal and Henry decided they were going to buy up the product so the price started moving upwards and it seemed to go parabolic. Essentially they tried to pull a Hunt Brothers commodity squeeze. Ice cream manufacturers are big customers of vanilla but at $20 to $30 a pound, vanilla makes up only a fraction of the cost of ice cream. W hen the price moved into the $100 per pound range, then it started to really effect profits. Ice cream companies began to switch to other alternatives. Supplies continued to dwindle because farmers had cut vines in the latter half of the 90s leaving the market short. Like a perfect storm, you had too many players chasing the beans for supply control reasons, smaller crops, lower qualities, and everything started to go south. Instead of delivering, suppliers were selling to the highest bidder. You would advance them money and they wouldn’t deliver anything. There was no way to enforce contracts so the decision was made to send a permanent presence to the bean fields to represent Shanks. Our supplier Nick in Madagascar had a hole in the accounts but we couldn’t walk away from him leaving us with few options. We had some big holes in our order books and despite
our lack of trust in Nick, we were stuck with him. Initially, I sent Ray, one of my colleagues to babysit Nick, but then Madagascar decided to have a civil war. In June of 2002, I flew to the capital and made my way by bus to the dividing lines between the two camps. The local military was concerned that I was a journalist but using my pigeon French, I convinced them that I was just a foolhardy American with no camera or notebooks. Eventually, they let me walk the 2 miles across no man’s land to the other side where I caught a Toyota pickup bus and traveled into Tamatave, my home for the next three years. Ostensibly, Ray was to meet me when I arrived, it was a Saturday morning and the town was quiet. The French had evacuated most of the foreigners that morning and Ray had caught the last flight out. I checked in at the local hotel and prepared to stay for the long haul. Civil war or not, the vanilla had to ship. I spent some time with Nick going over the books and preparing goods for shipment. Unhappily, I discovered our loss was not $150,000 but $300,000 because Nick had a gambling problem and was spending his weekends playing roulette with the company money. I didn’t even bother to inform the US side because there wasn’t much they could do, I would just have to find a way to improve the costs. Nick kept dipping into the till during the summer and I was reaching a breaking point. I told him that if he took any more money that some South Africans would be visiting him and he wouldn’t be able to take anymore. Nick is not the bravest guy and he was on the first plane out that afternoon. It’s one of the few times in my life that I have ever wanted to truly murder someone. Had Nick not left, I might have called the South Africans to take care of my financial problems, I was that angry. The next problem I had was with the suppliers. They had this neat trick where one supplier would take your money and pretend to go to the bush to buy the beans. Then a few weeks later, he would come and say that he was having trouble, please wait a few more weeks
but in the meantime his cousin had some beans and he would supply me on credit. After the second time, I caught on to this and recognized what they were doing but I was out another $100,000. The manager’s were stealing, the workers were putting the beans in condoms and stuffing them in places to beat the body inspection, and the suppliers were arranging for breakins to steal beans and then sell them back to me. The theft, the lying, and the complete lack of any morality and ethics were unimaginable. When prices hit $200 a pound, it was everyman for himself. Instead of advancing money, I was forced to hire a plane and fly everywhere with duffle bags of cash. At $200 a pound, and a 1,000 pound load in the aircraft, it’s $200,000 a flight. The largest currency in Madgasacar was equal to about $5. We were literally flying around the country with bags of cash like a bunch of drug dealers. I was living with body guards from the police and the Army and I carried a Walther PPK for protection. My gun was not to protect me from thieves, it was to protect me from my bodyguards. It was routine for me to put the gun on the table during negotiations to let people know I wasn’t playing. When you carry that much cash, you attract all sorts of people. This kind of pressure of course led to drinking a bit more than I like because the only entertainment in town were the bars, the casinos, and counting mosquitos. I was starting to spend more time in the bars and eventually, I started spending too much time with the locals. When I realized I was going in the wrong direction, I called my wife and told her to come to Madagascar, especially since the civil war had been resolved. Kristen was not working at the time so she and my daughter Audrey got on a plane and flew over. We had a nice villa across from the French consul. His wife was Vietnamese so Kristen had someone that she could make a connection with. Most of my day was spent chasing suppliers and dealing with thieves and I felt that Kristen enjoyed her time there. She wanted me
to spend more time at home to help with Audrey but I had to be onsite to keep an eye on what the workers were doing. I was losing 10 pounds a day to theft and if I wasn’t there, I lost 20 pounds a day. I had hired a maid for the house, a cook for the kitchen, and a babysitter for Audrey. With three full-time staff, Kristen was complaining that it was too difficult to take care of Audrey. I was not amused and I understood some of the problems but I had no solutions. Madagascar is one of those unique places that is a cross of idealic paradise peppered with stark poverty. As a vanilla king, our lives were punctuated with unusual occurrences that are at once unbelievable and yet perfectly understandable. Once we flew up to Sambava and took the mini-French taxi to Anatalaha along the red mud clay roads. On this trip, the bridge had been washed out by one of the many cyclones that would rip sections of the jungle out much like a tornado leaving the surrounding area untouched. To get the taxi across, the local villagers picked it up and put it in two canoes with one set of tires on one side in a canoe and the other set in another. We sailed the 25 meters across the river picked it back up and continued on our way. Another time, one of the vanilla buyers could not get to a meet on foot so he dropped $25,000 in cash out of the airplane. Unsurprisingly, the money did not hit the right spot and the police were called in to search the jungle floor. There was little doubt that money would ever be found and just added to the losses faced by the industry. Sometimes it was the simple things that could never be understood, so one had to just take things in stride. Still, we did our best to cope with the situation and I tried to insulate Kristen from the worst parts. I had made up some of the losses by selling to outsiders and was doing pretty well with keeping up with shipments. To put me out of business, Ykbal got the government to push a regulation preventing low-quality beans from being exported. I countered by chopping the beans and dumping them in a water/alcohol blend to make a pre-extracted vanilla slurry. I exported
this product as vanilla extract with the bean. The government did not know how to handle that and my local agent managed to find a way because there were no rules about extracts. The next year, Ykbal again put pressure on me because the government made a rule that no one could have vanilla in the port at the end of the season. Any remaining vanilla stocks were to be taken by the government. I had $500,000 in inventory and my agent arranged for me to meet with the Chief of the Supreme Court. I had to disappoint him because he asked me to marry his daughter. She seemed nice enough but I was married and my wife was in Tamatave. He suggested I dump my wife because he had heard she was Chinese. I told him not right now, maybe another time. My agent managed to find a way to get around that regulation. There is a mistaken belief that America provides foreign aid to help people in poor countries. I imagine that is part of it but it is really about keeping access in the country. If we don’t provide aid, then the French will, the Germans will, or the Chinese will and an American company won’t get that next contract. The ambassador is really the nation’s go between for the government to keep the exports flowing. Without foreign aid our exports would drop dramatically. When candidates like Ron Paul and Rick Perry talk about cutting foreign aid, it makes me want to laugh, newbies. In the global business environment it is who you know and how much your agent/ambassador can put on the table. A lot of our foreign aid goes into weapons sales which then fuel local conflicts but wars are profitable so we keep funding them. That has to stop, America cannot claim it wants world peace while still peddling the bombs that kill people. When you do business in Africa, you need a local agent to take care of the problems. We don’t ask but I can imagine all kinds of things go on. Over the three years I was there, I met everybody but the President and they considered me to be a pretty cheap businessman. I can
imagine what Henry and Ykbal’s agents were doing to support their businesses. Around September of 2003, I caught one of my lieutenants stealing, fired him on the spot and reported him to the police. I was furious because my warehouse had been broken into through the roof and I had lost $125,000 in inventory. The next day, a police captain whom I occasionally drank with came to visit. He said if I didn’t drop the charges they would kidnap my daughter and kill my wife. He also demanded that I rehire the manager and put him back on the payroll. Apparently, my employee’s uncle was a Colonel and head of the regional police. I dropped the charges but did not rehire him. Instead, I put Kristen and Audrey on a plane back to the US. I stayed pretty close to the house for awhile but every week I talked to Kristen. Every conversation was just a litany of problems one after the other much like the complaining about needing help despite having three maids. She was getting my entire paycheck but resented the money I was paying to my first wife. She felt our daughter was not getting her fair share, plus we had the houses to take care of and they were absorbing a lot of cash flow. I pushed her to get a job and happily she found one. In the meantime, the stress was building and it was New Years. As usual, I was out partying with my Belgic friends and I ran into Tina, one of the local girls whom I had struck up a friendship with before. Tina at the time was young, gorgeous and her boyfriend had just gone back to Switzerland. I had just got off the phone with Kristen listening to all of our problems before I went out. I was in a foul-mood and that coupled with too much Captain Morgan led to one of my dumber moments. Tina came home with me and didn’t leave. Drinking and stress are not excuses for boorish behavior and I certainly showed very poor judgment but at the time, Tina was the only thing keeping me from exploding. Hindsight is twenty-twenty and it’s easy to judge one’s past actions and harder to distinguish them while they occur. Depending on the day of the week, I was up $500,000 or down $500,000 with everyone I
met or talked to trying to steal from me. All Tina wanted was a friendly relationship without strings and absent her emotional support, I might of killed someone or myself. Eventually, Tina got pregnant and I compounded one mistake with another. Psychologists talk about a syndrome that relates to replacement theory. When pushed into a high-stress environment people try to recreate a low-stress environment and I suspect that was what I was doing. I can’t really remember everything from that time because stress and adrenaline were all that was keeping me going. During the summer of 2004, the price of vanilla crashed and now instead of having a constant increase in price, we had a constant decrease. Supply had finally caught up with demand and demand had permanently disappeared. Henry, Ykbal, and I had successfully killed the vanilla industry. With no customers and more and more vanilla coming from the harvest, the price fell from $200 a pound to $20 a pound in three short months. Each pound I bought I was losing money on before I could get it shipped out. Eventually, the price dropped to $10 a pound. I had a loss of about $350,000 and at $2 a pound profit and only 40,000 pounds a year in volume at that time, it would take about 5 years before I could make up the loss and see my way into sunshine. Then my contract got canceled because Ykbal offered a lower price. Ykbal was desperate to keep his business going and so he offered Shanks a low price to keep his factory open. I knew he wasn’t making money, I knew his costs but I felt it was better to let Jeff make some profits than worry about my giant hole. Eventually, Ykbal came back and begged Jeff to accept a higher price on the second half that averaged out to my original quote. I saw that coming but by then, I had basically dumped my inventory and equipment at Ykbal’s and prepared to close up shop. I stayed in Madagascar until William was born just to do the right thing and left. I couldn’t take Tina or William with me, the US government frowns on
noncitizen girlfriends and visas are impossible to get for them, so I resolved to just send her money on a regular basis to help her with living expenses. It’s an impossible situation of my own making and one that I have often regretted to this day. To an American, that may seem pretty weak excuse, even shameful. It’s surprising how different the world is to what Americans are accustomed to at home. In fact, much of the American perspective bears little resemblance to life overseas and it explains why people think we can export our culture and democratic principles when they would never work. The whole notion of exporting American secular democracy to the Middle East is unbelievable and really just an excuse to justify American commercial expansion to the voters. The only place you can live successfully as an American is in America, everywhere else you have to adapt to local customs and practices or you become crazy. In my case, I adapted too much, however, Tina is delighted because she has an American baby and eventually she can come to America. Further, the Africans believe that American babies are more intelligent so her baby is more intelligent in her eyes. Marriage is not important to the islanders and while she might like to be married, she knew I was married when we first met, she had seen Kristen and Audrey and I had never promised her anything. She made my life bearable for one very difficult year and I gave her what amounts to a storybook opportunity in the future, a way off of that rock. Still, I felt awful about leaving William and her but I still had three other children that needed my support as well. Either, I could spend the next 10 years trying to sort out the finances of the company or move on to new opportunities. The truth was I was seriously stressed, suffering from depression, and needed to chill-out for awhile. The only person in worse shape than me was Ykbal. He and I became good friends towards the end of my stay in Madagascar and I don’t know how he kept it together.
In the fallout from the war, Henry’s family lost more than $25 million, Ykbal lost $8 million, a French competitor lost $6 million, and a host of other companies lost a million or two. I felt my loss was minor in comparison. At the end of the day, the only one left in the business was Ykbal because his bank couldn’t afford to take any more hits. I estimate the industry lost about $45 million collectively and nobody benefited in the end. Some farmers made a lot of money and some middlemen but most of the middlemen got squeezed out in the end so it became a waste of 15 years for me. I flew home and resigned from Shanks. I had had enough of this nonsense, had left a woman I cared about with a child, and flushed a career down the toilet, long live the free-market and capitalism. Some might say that free-markets always achieve the best financial outcome, I fail to see any “best” result from my experience, only a lot of misery and heart-ache for 1,000s of people. The free-market may yield the most economic result but the process is messy and not for the faint of heart. I was not ready to deal with Kristen yet so I cleaned up the house finances and got back on a plane for Singapore one month after coming home. Ykbal wanted me to set-up an extraction facility for him and I wanted to try and get back into the game to try and salvage something from the last 15 years.
Chapter 9 – Vietnam The amazing part about Singapore is how much it is like California. The weather is great, the sun is always shining, the streets are wide, and the buildings are modern. If it wasn’t for the fact that everyone drives on the wrong side of the road, I would think I was back in America. I admire the design of the city because despite being an island, the city has a modern subway, excellent bus transportation, and many of the shopping malls are located underground. In America, we waste so much space with vast parking lots that a trip to the mall may require hiking boots and a canteen depending on how crowded it is. Occasionally, I lose my car when I come out of the mall and spend a half-hour schlepping my bags around looking for it. That doesn’t happen in Singapore because who needs a car and you can’t misplace a subway. During my six-month stay in Singapore, I spent most of my time reading and relaxing. I went to Ykbal’s office everyday and tried to find ways to market vanilla and support an extraction facility. I had a pretty good idea that we could extract beans at $5 lb and sell off the waste product for $3 leaving a net cost of $2 for the extract. This would allow someone to accumulate excess material and eventually force customers to come to him or her during a supply downturn. Instead of selling beans, the bean collector could offer extract. The beauty of stocking extract is that it just gets better over time like Scotch whiskey. The trouble is that someone has to believe that they can purchase enough goods with a future potential sale. That is pretty risky and despite the fact that the numbers work, I couldn’t get any of the dealers to bite. Everyone had just gotten burnt and no one wanted to take inventory positions and hold them. It’s a pity because the potential profits were huge once vanilla doubled in price and the carrying the cost was very low.
Realizing that this type of program was not going to get very far, I started putting out feelers to see who might be willing to hire me. I contacted some suppliers, offered to build an extraction facility and I was able to get three interested parties. I visited each party in turn but decided that Indonesia may not be my best choice. When I went to see my friend John in Manado, I was reminded of living in Tamatave for the past three years and decided that it was not a great idea. I envisioned myself hanging out at bars at night and trudging to a small factory everyday for a year. That might have been interesting 10 years ago but I have been there and done that. Instead, I decided that Vietnam may hold greater promise. I met my sometime business partner, Andyan Rahardja, in Ho Chi Minh City. He suggested that I work on some projects there and try and rebuild something. I really wanted to work in extracts and the money seemed a little squirrely so I passed on that opportunity, too. I went on to Hanoi to see a friend, Mark Barnett, and talk to him about what he might need. It turns out he needed someone to manage the construction of his new warehouse and grinding facility. Further, he wanted to produce essential oils and begin processing cumin and cinnamon. It wasn’t vanilla but I understood what he wanted and agreed to take on the job. The only catch was that he couldn’t pay me in the beginning… Having nothing better to do in Singapore, not wanting to go to Manado, and I wasn’t sure I would get paid in Ho Chi Minh City, I decided to go for it. I still had some money from my 401K so I could live on that for a little while. Mark agreed to provide a cot and three meals a day so I agreed to his offer. Mark’s an unusual character and sometimes we get along and sometimes we don’t. He came to Vietnam after his family business, Barnett Spices, collapsed in a price squeeze that the industry went through back in the early 90s. I had called him then and tried to get him to buy our flavors and extracts but it was already too late by the time I contacted him. He moved to
Vietnam when President Clinton opened the door for American businesses and by hard-work and a bit of luck, Mark built himself a nice cinnamon and pepper export company. The one thing that Mark offers his customers that the local purveyors do not is a reliable product. He does not cheat and he does not adulterate so customers like McCormick and British Pepper & Spice know he will deliver what he promises. Mark is also from New York, so he knows how to squeeze the pennies together to make a nickel. One of the things we disagree on is his compensation for his employees. I always felt bad about how little we paid the Malagache and Mark was doing the same. I guess that is how one makes money in capitalism. Working in Vietnam was distinctly different than working in Madagascar or Indonesia. The people are harder working and more aggressive about improving their lives. It must have something to do with living on islands versus living on a mainland. The Vietnamese know how close to starvation they are and they work ridiculous hours every week. The normal work week is 50 hours without overtime and the normal worker, prior to 2011, earned about $50 a month. Now the minimum wage is double that because of the high inflation here. Vietnamese routinely work seven days a week from sunup until midnight. It is not unusual to hear someone banging away with a hammer until mid-night. A vacation in Vietnam is three days at the beach and then back to work. Each year they take from one-week for city folk and one-month for country folk to celebrate Lunar New Year (Tet). Some urban dwellers also take a week or two in the summer now to go to the beach if they can afford it. However, if one’s employer requires one to work, one does not ask off for vacation. It is a very hierarchical culture and the boss is the boss, no questions asked. I was working at the factory with Mark and staying at his house. In my evenings, I would surf on my computer about vanilla hoping to find a new opportunity or read one of my many
books purchased in Singapore. English novels at that time were still hard to come by in Hanoi. It’s getting better but for a long time, the government restricted much of the material coming in. When Vietnam joined the WTO, the restrictions on books seemed to lighten up and we started to get much newer material, although it seemed that specific authors needed approval. I was a little bored and Mark suggested I start going out in the evenings and I decided that would be a good idea. I asked one of the office girls to give me a tour of the town and she agreed to do it on New Year’s eve. Nga worked in the downtown office and I worked at the factory. We occasionally crossed paths but it wasn’t like an office romance could develop. I was still trying to decide how to deal with a child in Madagascar and my wife Kristen in the US with my daughter. We had been talking about her coming to Vietnam but I was still pretty angry at everything and everyone. My anger had taken four years to build and it was going to take a little while to cool down. Nga and I went out a few times and I visited her at her shop. Like most Vietnamese, she had two jobs, her day job and a small souvenir shop that she owned to cater to Korean tourists. One of the first things I discovered when I moved to Vietnam is that Vietnam is not a communist country. Sure the Communist Party is the only party in power but not only do 95% of the people not understand what communism is but they also are avid marketers and capitalists. The average Vietnamese citizen spends most of their time trying to earn a buck and they are tough negotiators. Everything is based on market economics, although the government does get involved in the rice harvests much like America supports the dairy industry. Nga had her shop and she was going to get rich. In April, I decided to go back to the states and visit Kristen and Audrey and see if there was a chance to work things out. Kristen was pretty angry with me because of William and I
don’t blame her. She was moving into an apartment and I helped her move but things were not the same. My main problem was that I wasn’t angry with her, I just didn’t have any feelings for her anymore. As much as I tried to see a future together with her, all I felt was emptiness. Those years in Madagascar and now my time in Vietnam had changed me and as a different person, I couldn’t relate to her, life with her, or a life in a strange community filled with strangers. At the end of 30 days, I said goodbye and I didn’t go back. I had been telling her for several years to divorce me and there did not seem much point in continuing. I had to make a decision of whether I go back to the US and live with Kristen or go on to something new. Anyone that has never gone through a divorce may not be able to understand the feelings I had. Those who have lost their careers, gone through wrenching changes, and fallen out of love can understand the mixed emotions I was dealing with. I didn’t decide what to do right away but after a month or two, I called Kristen and told her that I wasn’t coming back, that I would make a new life for myself in Vietnam. Kristen was angry but she didn’t file for divorce until several years later. She did say that I had to make a choice and that if I did not come back, I could not see or talk to my daughter. That is something she will have to explain to Audrey when Audrey is older, I don’t envy that conversation. Over the summer, I got to know Nga better and when she closed her shop for good on New Year’s eve, I helped her move the inventory to a storage place. That night she introduced me to her mother and we were officially dating. The Vietnamese are very old fashioned about dating and fathers watch their daughters like hawks. Normally, the children are not permitted to date at all until they finish school. It’s not unusual to meet college students whom have never gone on a date. When dating, they are never supposed to engage in any public displays of affection. Culturally, the Vietnamese do not go dancing together in bars like in America and
instead meet together for family events or at a Karaoke bar. Despite being 28, Nga had to be home every night by 11 pm or she would get a serious tongue lashing from her mother. I thought it quaint and with all my past mistakes, I was not in a hurry to get too seriously involved. I worked at Mark’s factory for two years until the warehouse was completed. I had setup a decent essential oils distillation facility but the economics just weren’t there for the particular oils his product could produce so it mostly sat idle. The farmers in the bush could use free wood scraps from the trees to cook the oil so their costs were always lower. Mark had hired a mechanical engineer to set-up the grinding system and I was itching to start my new career, teaching English. I had started teaching English to some local children and discovered I had a talent, as well as a tremendous sense of pleasure when these young minds began to grasp the lessons and communicate with me. Teaching English to children in developing countries opens a door filled with endless opportunities for them. I knew that the work I was doing would change these children’s lives forever. If one teaches in a developed country, the children have innumerable opportunities to go on to college, find a good job, and have a normal standard of living. In a developing country, knowing a foreign language is the difference between a life of despair and a chance to succeed. For these children, I knew that they would become successful and that was all I needed as compensation. I rented a small house, the students paid the rent and the books and I spent two years teaching about 150 different children English. Teaching is more of a calling than a career. Either one enjoys teaching or it can be an absolutely miserable experience. The students know when a teacher is uncomfortable or uncertain about something and like a wolf tracking prey, they follow the scent and do everything possible to make the teacher look foolish. I had to stay on top of my game and I enjoy the
challenge. Eventually, my money ran out and I had to get a real job, so I applied at a local university and they hired me to teach English. Now that I was teaching children in Hanoi, I had more time to spend with Nga, one thing led to another and she got pregnant. I was still married to Kristen because I had no incentive to file for divorce and the cost to do so from Vietnam would make doing so an expensive proposition. But we were definitely separated and not communicating. Nga had a family gathering at a restaurant and we told the family that we would be living as husband and wife and a baby would be coming soon. We found a house and eventually Bruce came along on Valentine’s day. He missed Lunar New Year by one day which would have made celebrating his birthday a challenge as Lunar New Year moves around every year. Bruce is a happy boy and big for his age, he speaks English and Vietnamese and is a testament to the merits of educating children at an earlier age in a multi-lingual environment. As a dual passport holder he will have many opportunities in life and I hope when he grows up, the world will be a safer place. Teaching English overseas is mostly a Johnny-on-the-spot affair. Almost every program needs an English teacher and sometimes the only requirement is possessing clear diction and the right accent. I find it humorous that in Asia, there is a real affirmative action plan for white males from the US, Australia, Canada, and the UK. Griggs needed an English teacher, one that would work for peanuts, and one that could start tomorrow. I took the job and continued teaching at Griggs for more than two years. After my first year, they hired me full-time and put me in charge of the foreign staff. I had to find reliable teachers, help prepare the curriculum, prepare three hour classes, and wash the dishes it seemed. However, to become a full-time associate professor, I had to enroll in a Master’s program to meet the expectations of Griggs
USA. I had been talking to University of Phoenix off and on for two years about getting my Master’s so I decided to go ahead and start classes. Working full-time and going to school at night limited my ability to teach outside classes so I had to stop teaching the children and concentrate on the university students. Teaching at university level is much different than teaching K to 12 students. The K to 12 students wanted to learn, whereas, many of the university students were just marking time and had no desire to learn. At times, I felt like I was wasting my time with many of the students but after teaching them for nearly three years, we moved beyond the typical professor/student relationship and I became as much a mentor as a teacher to them. During my time at Griggs, I taught English, History, Religion, Communications, American Literature, Expository Writing, and American Culture. Needless to say, it was normal for me to have every student at the university in at least one of my classes each term. Teaching the Griggs students made me realize that if I was challenging them to take charge of their lives and become future leaders, then what was I doing with my own life? Once I started taking the Phoenix classes, I really began to realize how much the US had changed in my absence. One of the advantages of taking the online classes at Phoenix is that I get to meet a diverse group of students from all walks of life. The school requires everyone to engage in online discussions to build mutual understanding on a variety of topics. What I learned during my first year of study was how badly our education system is performing. More to the point, I began to realize the source of the problem, it was the educators and politicians in Washington. Instead of putting children first, they were putting their ideas of what children should be, first. The entire system is not designed to educate but to convert children into socially pliant citizens. The grand legislation to fix the system, the ‘No Child Left Behind’ act, is a sham designed to
destroy the public school system, end public school unions, and privatize it to the benefit of corporations. Once I realized how pernicious the politicians had become, I understood that I had to get involved and do something to change it. One can try to change the system from the grassroots level or one can start at the top. In my experience, changing something at the bottom takes a long time and when your opponents are well entrenched, it may even be impossible.
Chapter – Running for President Teaching provides lessons for both, students and teachers, lessons that I have taken to heart. My students, ever the inquisitive bunch, often ask naively why if something is such a good idea, why isn’t the teacher doing it. After awhile, a teacher has to ask him or herself, why aren’t I doing it? Most of my students focus on making money thinking that money will solve all their problems. Money can make life easier but it is no solution to one’s problems, in fact it often creates far more problems than it alleviates. That being said, there are about 6.5 billion people that could use a little more money. In October 2002, I was watching George Bush and some of the other pundits on television and I began to realize how fake and staged everything really was. The US had just committed to spending $1 billion on shipping troops to the Persian Gulf to put pressure on Saddam Hussein. Nobody spends $1 billion on something unless they plan on doing something to justify it. The entire melodrama that unfolded from October until March when America finally invaded Iraq was simply the time needed to organize and prepare those troops for invasion. Could it have been called off, certainly, but once committed, it is unusual for politicians to admit an error. To me, it was crystal clear that President Bush was going to invade Iraq come hell or high water regardless of what the world had to say. I see the same behavior today regarding Iran. That month, I changed to the Green Party. It was a pretty simple decision because the Democrats were cheer leading the war effort and the Green Party was the only anti-war party. Furthermore, I had been disappointed with America’s march to the right leaving me standing still. In college, many would have characterized me as a conservative. By the time the religious right molded the Republicans to their message, I was now on the left. I didn’t change, the world
changed and left me in the dust. As a Boy Scout, I had developed a natural affinity for the environment, how could one not? Wanting clean air, water, or food free from pesticides is a natural desire because no one wants to live in a pig sty. Deciding that quarterly earnings is more important than people’s health is a Faustian bargain because we can always make more money, but we cannot return people’s health. Whereas, there are some policies the Green Party supports that I find a little ‘out there,’ when it comes to the core issues, they represent my worldview. Like someone who finally decides it’s time to throw away those tired old penny loafers because they have numerous holes in them, I switched to my new ergonomic sandals. Once America invaded Iraq, I had a new dilemma to deal with. I don’t think I am smarter than the average person but I did study the Iraq and Iran war as part of my studies at the Army War College my junior year. I read a tremendous amount of material and felt I knew the political situation better than many of the journalists predicting an easy victory. Certainly militarily it was a cakewalk, however, when we dismissed the military we opened the door to insanity. Further, with no WMDs, this war suddenly took on an entirely new dimension, it became an illegal war. If I had misgivings about Afghanistan, I was incensed by the stupidity that propelled us into Iraq. Sure Saddam Hussein was a bad guy but America created this monster and instead of fixing our mistake, we made it worse. At the time, I was in Madagascar and I resolved that my protest would be to not go back to the US until the wars were over. When one spends money in the US or earns income, one pays taxes. Those taxes are used to pay for the wars and become an implicit acceptance of the government’s policy through the social contract. That does not mean that people agree with the policy but they do accept it. The only way to register your protest is through voting or not paying taxes. The simplest way to not pay taxes is to leave the country and earn less than
$85,000. When it came time to go back to the US in 2005, there was no question in my mind, I did not want to return to a nation that I viewed as imperialistic and engaging in multiple illegal wars. Many would say those wars are justified and maybe they are but until the proof is put on the table, they are illegal by international treaty, a treaty that we expect others to follow. Specifically the war in Afghanistan is predicated on the fact that Afghanistan was providing shelter to Osama bin Laden. Bin Laden was wanted in connection with attacks on our embassies in Africa and for being involved in the September 11th attacks. Whereas, President Bush told us he masterminded them, he never did provide any evidence. That aside, bin Laden was a bad guy but did it require an invasion of a sovereign nation, the killing of 1,000s of innocent people at a cost measured in the trillions to the American people. I think we could have sent 10,000 g-men to ferret this guy out, bundled him on an airplane and flew him home. Seriously, it didn’t take an invasion force, that’s overkill but more importantly, we broke international law and set a precedent of unilateral action. When we attacked Iraq, we used that unilateral action clause to justify our actions. Saddam was a threat to all humanity and needed to be eliminated because his WMDs were going to be used unsparingly against innocent people. We soon discovered that that was one of the biggest cock and bull stories of the decade. What we did was kill100s of thousands of Iraqis, polluted their country with depleted uranium, and destroyed the social structure of their nation. We offered up a rump of a democracy that even today cannot survive on its own and will most likely crumble amidst civil war and chaos. Iraq was never a stable country to begin with. The British collected three groups of people and put them together such that they would always be in competition and struggle, the better to control them by playing one group against the other. If
one looks at the history of former British colonies, it is easy to see this pattern. Think of Rwanda if you doubt the reality of that analysis. In 2008, it seemed that America would be going through change. There was this guy, I don’t know what happened to him, named Barack Obama who promised hope and change. He was elected President and like his portrayal in the Onion News was kidnapped and replaced with another tool of the establishment. I didn’t vote for him, nor did I vote for John McCain and his uninspiring companion, I supported Ms. McKinney as any Green would. I find some of her ideas to be ‘out there’ but at least she didn’t want to turn the Middle East into a graveyard for young Americans. I didn’t buy into the whole Superman impression the media presented for Obama and cynically was not disappointed when the man that was elected was not the one who took the oath. Many people point to Republican intransigence as the reason for the President’s failure to accomplish more change. There is some truth to that but when you look at the substance of what the President has done, he is either the worst negotiator or completely incompetent. I prefer a third theory, one that is more pernicious, he never intended to work for the people, instead he works for his campaign contributors and the people are just a means to an end. I feel the Republicans are no different and when I look at Gov Romney, I only see a Republican version of President Obama, a tool of the establishment intended to continue business as usual mouthing platitudes for general consumption but never really changing anything. For some, they choose the Libertarian’s path to change, believing that by shrinking government to a fantasy of minimalism that one could solve all the nation’s ills. The point they miss is that government is not the problem, it is our leaders that are the problem. Blaming the government is like yelling at your hammer for smashing your finger when you miss the nail.
Certainly there are areas where we can make improvements but let’s be honest, do we really trust GM, GE, Microsoft and others to be good corporate citizens with no regulations? I began blogging on various sites including the Young Turks. I found TYT quite by accident and found the coarse no-hold barred discussions to be intellectually stimulating and challenging. When one debates, the best way to prepare is to argue the opposite side of the argument. Posting on TYT allowed me to explore various opinions and develop a better understanding of the issue. One of the hazards of belief is that we can become blinded to the truth. By arguing the opposite of your beliefs you can explore the various avenues that you may have over looked demanding rethinking and reflection. This helped me codify some of my ideas into a coherent vision instead of just quoting what someone else said online. There is a bad habit by many people of just mouthing the accepted wisdom without really thinking through the issues. I find that I need more than somebody’s word or thoughts before I will agree with them. At times, the TYTers thought I might be playing possum, I denied it because, if they thought I was playing possum, there would be no more debate. However, eventually some of the bloggers became tired of the stridency of the hard-core Republicans and began to limit the debate to approved bloggers. This ended most of the interesting debates and it became more of a mutual love-fest and support site for disaffected progressives. I have been blogging anti-war posts since the beginning of my blogging in 2006 and in April of 2011, when it was clear that America was going to support the overthrow of yet another middle-east country, I really started to get angry. It’s a visceral anger that has been building for a long-time. An anger, directed at our politicians who value money over principle and a nation that treats the lives of nonAmericans with no regard or respect. If one listens to the average American, one hears amazingly contradictory statements that baffle foreigners. Americans
demand special treatment and protection for Americans but think it nothing to drop bombs on a wedding killing a few innocents to get at one particular bad guy. NonAmerican life has become cheap and our behavior reflects the video game culture of ‘Call of Duty’ or ‘Counterstrike.’ Foreigners caught in the crossfire are just collateral damage, regrettable but necessary in our unending struggle against terror. The macabre atmosphere that prevailed after the assassination of bin Laden was more like a sports tournament than the very dirty business of murder that took place. Do Americans consider that 25 highly trained Americans invaded a country, took a sleeping man in his pajamas surrounded by his wives and children and shot him in cold blood? They only see a victory against an arch villain as if it were the latest installment of ‘Batman.’ President Obama claims it shows he’s tough but others see it as a weakness. How tough was he, when he shot an old man in his PJs surrounded by women and children. In May, I discovered Americans Elect and I knew that I had to get involved. I thought about running for Congress but without the resources and the connections, it’s unrealistic. The change that America needs is at the top, America needs an executive committed to standing up to the corporate tyrants and calling for a constitutional convention to rebalance the relationship between the people and their masters. Ordinarily, I would be rooting for someone with the same ideas or values that I have but this year, they are absent from the discussion. I blogged and blogged asking who will represent progressives, which candidate will step forward and lead progressives from the darkness into the promised land? I admit, it’s a little hyperbolic, but in point of fact, I was hoping that Gov Dean would run. He has chosen to stay out of the race leaving us with President Obama, the banker, or a Republican, the corporatist. That is a choice I cannot accept and like every other dirty job I have taken on, this one needs doing. If no progressive is going to run for President then I decided I will. In September, when Americans
Elect opened the discussion boards, I found a lot of other people agreed with many of the things that I believed in. So, here I am the most unlikely candidate for President. Epilogue Since I committed to run for President, two other progressives have actively entered the race. Jill Stein representing the Green Party, a sometime competitor, and Rocky Anderson of the Justice Party. I appreciate Jill’s ideas and wish her luck but I am not certain the American people are quite ready for her vision of our society. As for Rocky, I think he and I have a similar vision for America and he presents a quandary for me. Should I withdrawal and support Rocky as the better man or should I continue with Americans Elect? In point of fact, Rocky seems as interested in building a new political party as he does running for President. I believe in the vision of Americans Elect, where two intelligent people can come together and bridge their differences to bring fundamental change and balance to our nation. Despite any misgivings about competing with Rocky and undercutting his message, I don’t think another political party is the answer, I believe the President needs to transcend party politics and represent all the people, not just those whom elected him and her. With the passage of the indefinite detention act, there is no question in my mind that what I am doing is the right thing. Whatever the personal cost, I will pay it because this callous trampling of our fundamental liberties by people we elected to serve us cannot go unchallenged. Patrick Henry stated at the beginning of our first revolution, “Give me liberty or give me death.” This year will see a political revolution with the same consequences as our first revolution, the return of governance to the people. Like Patrick Henry, we must be prepared to put everything on the line to prevail against the corporate tyranny that would enslave us.
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