WHY WE DON'T LEAD ANYMORE:
Last night I watched 60 Minutes, as I always do on Sunday nights, and was struck by a segment on an Italian company, Luxottica. It is the largest producer and distributor of eye ware, (glasses) in the world.  I kept thinking throughout the broadcast why is the largest producer of anything not in the United States?  In fact on another segment on the same show they discussed a Chinese company, Huawei that is now the largest telecommunications equipment manufacturer in the world followed by two others from Sweden, Eriksson and France, Al Ca Tel.  It was a disturbing shock that we have been the inventors and the leaders in these industries and are now down-the- line competitors to companies in other countries.  Why I asked?

My answer, while not over run with specifics to back up my thesis, is that the principal product of the United States today is MONEY. Sure we still have the inspired garage inventors creating things and the money people are still giving them money to scale up their products, but the long range strategy of these companies is to sell the company before profits are even on the horizon, or if there is sufficient revenue, go public.  In both cases the inventors and early investors get their money out and become part of the new rich, with bigger cars, planes, vacation homes and other toys for leisure that are the by product spoils for the inventors and investors.

But what happens to the companies and the products they made after the “get rich quick” sale takes place? Many of the companies go out of business, get absorbed into other product lines or simply vacillate between what was a good idea and is now an also ran product.

In colleges throughout the country we are educating our young in the art of business, basically the art of making money. They are not being taught the art of making something, creating something or even the art of selling something.

There is money to be made investing in other money opportunities, or money being made as a commission on monies transferred to other instruments, or monies made in tax schemes, or real estate transactions or swaps of some sort. The language of the moneyed workers has been reduced to jargon understood by only those few who have the degrees in how to make money moving money. Making money this way is not easy by any stretch of the imagination but it takes different skills and seems to be a far easier path to making huge money than making something that has to compete in a market of talented competitors.

Back to the Italian company, I got the impression the CEO wanted to make money, lots of it, but there did not seem to be a single thought of selling his company in order to buy that vacation home. Maybe as a CEO he already has one but it will be as a by-product of his commitment to making and selling a better product.  His company only got bigger by buying other companies and making them better for the markets they served. In fact in one instance they bought a company, Ray Ban, shut it down for a year until they re tooled, redesigned and improved the products. Can you imagine an American company doing such a thing? The CEO would be terminated on the spot, given his gazillions in parachute pay and been replaced that very day

We used to think like that in this country. But now we let others make the products, manage the people while we focus on making insane amounts of money for a few people, while the people who contributed to the success of the early launch or the ones who also ran a risk by getting involved in the first place are left with new managers, downsizing, off shoring and re-organization. Is it any wonder why employee morale is so low these days?

The young people give the impression they want to get involved in a start up, sell it to someone else and then use the money to get into hedge funds, investment banking or other money driven enterprises.  More and more I meet young people who work in some form of investments, insurance, banking or other non-manufacturing industries.

With the advent of technology, the axiomatic speed in which it operates and the overwhelming quickness products are obsolete, though more innovation, do you think the rest of the world will wait for us to imagine, create or make it and then they will copy it? I strongly doubt that. If we follow our current course of business and politics we will only be good for serving burgers, pizza and soda by the tub. The rest of the world will be enjoying our landscapes, waterways, mountains and our heritage, as wealthy visitors. But lucky for us they will still have to eat, rent cars, take taxis, have their rooms cleaned and their trash removed. The vast majority of Americans will be able to offer those services.

If we don’t get started now the future for us is over.