Cultivate The Exceptional Individuals
By Todd Hixon
I spent last week (super-storm Sandy and the run-up to the election) in Australia, one of the world’s most fortunate countries. Australia is blessed with natural beauty, weather like California (and no hurricanes), and a huge stock of high quality natural resources to sell to hungry neighbors like China. Australia has not experienced a recession since 1990 and was lightly buffeted by the 2008 financial crisis.
US President Barack Obama points at supporters as First Lady Michelle Obama gives the thumbs-up, flanked by Vice-President Joe Biden and Second Lady Jill Biden following Obama’s speech on election night November 6, 2012 in Chicago, Illinois. President Barack Obama swept to re-election Tuesday, forging history again by transcending a slow economic recovery and the high unemployment which haunted his first term to beat Republican Mitt Romney. (Image credit: AFP/Getty Images via @daylife)
My Australian friends are very worried about where their economy is going, however. The government, run by two parties described as “both left of U.S. Democrats”, is building up a “nanny state”. The minimum wage is about $18 per hour, and a ham sandwich costs $20. Health care, a pension if your savings fall short, and higher education are paid by the government. Most worrisome is what Aussies call the “tall poppy” syndrome: high achievement is discouraged. Poppies that grow too high are “snipped off”, socially speaking.
My friends think (and I suspect they are right) that this happy country is at serious risk of a resource curse: if/when the resources dry up, Aussies will not be prepared to compete in world markets. High costs and entitlements will be part of the problem, but the lack of high achievers will be the greater problem; more on this below.
I went on to Hong Kong, which culturally-speaking was a breath of fresh air, despite the smog drifting down from Shenzhen. In Hong Kong the buccaneering spirit of capitalism is vibrantly alive and the high rise(r)s rise very high indeed.
I watched the election and its aftermath from Singapore, the perfect dictatorship. I was struck in particular by the candidates’ election night speeches. Romney’s speech was calm, generous, and showed a relaxed and sympathetic style in defeat that demonstrates Mitt really is a reasonable guy (I’ve known him since his 20s). Would that he could have projected such warmth on the campaign trail.
Obama put on a great show for his supporters and the country: looking every bit the winner, reminding us he is a family man, and praising his campaign team. The substance of his message was promises to take care various constituencies. I don’t doubt that these groups have needs and are deserving.
But, like the Australians, I think we are too focused on doling out the nation’s wealth to the average (wo)man, and not enough on cultivating that which makes us wealthy as a nation. The much-noted increase in income inequality is mainly driven by economic change (the information economy and globalization), which cause each of us to compete in a larger, global arena in which the winners, the truly exceptional individuals, reap the largest gains. Those with less competitive advantage have difficulty rising above the living standard of their competitors in India or China.
Our exceptional individuals bring home a disproportionate share of the bacon. Nowhere is this more clear than in the world of entrepreneurship, where the most gifted people are irreplaceable, and can build huge economic engines like Apple, Google, Intel, Microsoft, or Facebook (IPO hitch notwithstanding).
The election systematically dissed exceptional individuals that engage in business. I’m not talking about tax policy. I’m reacting to the characterization of businessmen as gamblers and exploiters, particularly Romney, who has a spotless record as a business leader, family man, charitable contributor, and leader in his church. He founded and built a great firm, Bain Capital, that has had notable success with both efficiency-enhancing buy-out investments, and job-creating venture investments, like Staples, Inc. Some of Bain’s investments failed, but many more were successful. Yes, there are some gamblers and exploiters in business, but that is the noise, not the signal.
We are starting to snip our tall poppies. And that worries me a lot, because the U.S. is not a fortunate island in a remote corner of the world with a huge resource base and 22 million people. We need to compete. To win we need to cherish and cultivate our exceptional business people, to bring forward the next generation of economic champions.
The great irony here is that Obama himself is one of the most exceptional people of the boomer generation: African-American, from a modest, single-parent home, he made his way to Columbia, Harvard Law, the Senate, and the Presidency. Without such people, the U.S. cannot prosper.
This post first appeared at blogs.forbes.com/toddhixon on November 9, 2012.