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  • The Suppression of Entrepreneurship

    Posted by David Foster on October 15th, 2010 (All posts by )

    Ken Langone, a co-founder of Home Depot, has an article in today’s Wall Street Journal in which he offers some advice to the President. A key excerpt:

    We opened the front door in 1979, also a time of severe economic slowdown. Yet today, Home Depot is staffed by more than 325,000 dedicated, well-trained, and highly motivated people offering outstanding service and knowledge to millions of consumers.

    If we tried to start Home Depot today, under the kind of onerous regulatory controls that you (Obama) have advocated, it’s a stone cold certainty that our business would never get off the ground, much less thrive.

    Regarding Obama’s comments at a town-hall meeting he attended, Langone says:

    I must say that the event seemed more like a lecture than a dialogue. For more than two years the country has listened to your sharp rhetoric about how American businesses are short-changing workers, fleecing customers, cheating borrowers, and generally “driving the economy into a ditch,” to borrow your oft-repeated phrase.

    My question to you was why, during a time when investment and dynamism are so critical to our country, was it necessary to vilify the very people who deliver that growth? Instead of offering a straight answer, you informed me that I was part of a “reckless” group that had made “bad decisions” and now required your guidance, if only I’d stop “resisting” it.

    Read the whole thing.

     

    10 Responses to “The Suppression of Entrepreneurship”

    1. David Foster Says:

      There’s also a discussion of the Ken Langone article here.

    2. Michael Kennedy Says:

      That was also an interesting discussion. I think it helps to read left wing blogs. They speak the same language that Obama does. I try to visualize these people and wonder what their life experiences have been. I used to read and comment at Washington Monthly when Kevin Drum was running the blog. While he and I disagree on most political things, I considered him honest and intellectually curious. For example, back when CBS put forward the Bush TANG hoax, Kevin had already heard about it and traced down all the participants, concluding that there was nothing to the story. It was greatly in his interest to find it was true but he was too honest to succumb to the temptation.

      After he left, it got farther and farther from reality. Finally, during a discussion of the health care bill, I was banned from commenting. I think my arguments were getting too much attention but who knows with a bunch like that ? That is the atmosphere of Obama’s policy thinking. It’s like a left wing college bull session. You cannot make prepaid health care work without rationing. The whole global warming thing was simply too rickety to stand once serious people began to tug at all the loose threads.

      Roosevelt did something very similar in the Depression. He did some good things and was a great war president but he had no idea of economics. He had this antipathy to his wealthy neighbors and to business in general. It was the sort of thing that a British aristocrat might say about someone whose fortune came from “trade.” Of course, the landed aristocracy never admitted that their fortunes came from piracy and pillage.

      I wonder what will happen if the Republicans decisively take both houses of Congress? The last time that happened, we had a powerful bull market to follow. Bill Clinton was agile enough to take credit as Newt Gingrich took his eye off the ball. I hope we can be as lucky.

    3. eugene henderson Says:

      Loose lips sink entrepreneurship.

    4. sol vason Says:

      If Obama were president of Chile the miners would be dead.

    5. Pawn Says:

      Good point Sol. In fact, despite their abject incompetence, there would be very little for this administration to gain from their rescue. They would be worth more to them dead than alive. Endless speeches about their and their families suffering caused by the evil corporations that exploit….. blah, blah blah…..

      It’s perverse that I feel this way about my country.

    6. Mike Says:

      Mark Twain once said that, “History doesn’t repeat itself, but it does rhyme.”

      Considering the renewed interest in the Great Depression due to our downturn, and the many coincidences that parallel the time frame, Obama’s up and down attitude towards the business shouldn’t come as much of a surprise.

      Amity Shlaes authored a book called, “The Forgotten Man” which was ironically released in late 2008. It was an in-depth historical chronology of the Great Depression and the many historical figures which participated in its cause and the implementation of the New Deal.

      The history showed that one of the problems behind the recovery effort was FDR’s almost schizo attitude towards big business. Subsequently, Obama is displaying a similar outlook. While this is not the totality of the problem with our recovery, it plays a part. Uncertainty within the business and banking communities is one of the main reasons as to why they are hoarding cash and not spending or giving credit.

      Until this situation breaks we will be in an anemic recovery for the long haul.

      Thanks for posting this article.

    7. Blake Says:

      Mike,

      An even more interesting parallel, GW Bush as the Herbert Hoover of this century.

      You don’t get one without the other.

    8. juandos Says:

      Well its not like we weren’t warned ahead of time how this neo-commie Obama wasn’t going to be anything but a problem for democracy and capitalism…

      2001: Obama’s own words on local PBR station

      In Bloomberg, Kevin Hassett warned us: ‘Manchurian Candidate’ Starts War on Business

    9. Michael Kennedy Says:

      An even more interesting parallel, GW Bush as the Herbert Hoover of this century.

      Nobody knows what Bush’s presidency would have been like without 9/11. I don’t think it would have been an example of conservatism like we will see from the tea party caucus after this election. He did, at times, try to rein in some of the more outlandish actions of the Democrats with respect to the housing bubble. He did try to reform Social Security. Both were good instincts, contrary to those of Herbert Hoover who was a Progressive through and through.

      Bush just never really showed a realization of where the housing bubble was going. Like most people, I was thrilled with the appreciation in the value of my house. Before the end, however, even I realized this was crazy. I even considered selling my house and renting for a while. I know some people who did that and did quite well. A couple of New York financial people saw this coming and made millions. This story should some day be a chapter in “Common Popular Delusions and the Madness of Crowds.”

      People talk about the stock market mania of 1929 but, in fact, this was a greater mania. Now, we read that unwinding the MBS ownership tangle may freeze the housing market for years. Roosevelt and Hoover made the 1929 crash into a Great Depression. I wonder what will be written about Obama’s actions and their effect on the housing bubble collapse. And in what language.

    10. Ralph Says:

      I may be odd, but I thought Ken’s comment about buying big swimming pools as calling attention to the president’s understanding of why people go and stay in business; only to make lots of money to use to buy nice things. Obama’s comment about he and fellow rich people being able to buy tv’s whenever they want them as a reason not to keep the Bush tax cuts is what I am thinking of.

      That is why people need to share the wealth, so others can buy tvs too, not to have retained earnings to help keep employees through slow times so they can buy their own tvs. For as much as most people call the President an elite, when it comes to understanding money and its use, I find he shares a similar attitude to those who live paycheck to paycheck.

      As far as Obama seems concerned everything that has ever needed to be developed to produce higher standards of living at lower costs has been. We can’t drive our SUV’s etc.

      I find the President a financial midget, and I think it reflects poorly on his advisors, so it would have been nice to see the op-ed directed at multiple players.