Greetings Leaders!

I was sitting at Starbucks yesterday morning day trading, when a very casual acquaintance came up and asked me where I thought the economy was going. I shrugged. He then proceeded to tell me that President Obama was a communist and heathen and that the he was (apparently) single-handedly responsible for destroying our country. He was very passionate about his message, and when I tried to ask about all the things he inherited, I basically got ignored. Remembering the saying “don’t throw pearls before swine”, I just let the conversation, albeit one-sided, die.

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Greetings Leaders!

There is an interesting initiative making its way through the California legislative process. Merry Hyatt of Redding California is pushing to have an initiative, requiring Christmas carols to be sung in public schools, placed on the ballot next year (Read the article here).

I haven’t read the initiative, but I think it is an important for a number of reasons. In order not to polarize the issue I won’t discuss the initiative itself, but want to ask the question, is it wise to take religion out of schools while at the same time teaching that evolution means there is no god?

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Greetings Leaders!

Yesterday I accompanied my wife on an extra-credit assignment for a class she is taking at Sacramento State. We went to the California History Museum in Sacramento and were treated to a educational trip down memory lane. There were several exhibits that I found interesting and thought provoking.

The Journey – and – the Welcome

One of the exhibits we visited was a video documentary of early migrants who made their way to California in the 1920s – 1950s. One of the stories revolved around a family moving to Anaheim from Texas in a 1950s car emblazoned with a sign that indicated they were from Texas. Upon their arrival they were surprised at how many people would wave to them and say things like, “welcome to California, Texas”! Is that the same greeting they would get today? I don’t think so. In fact I jokingly told my wife that people might wave, but they would probably be waving something else at them besides their open hands. What has happened to our country since the 1960s? Have we lost our innocence?

Cultural Melting Pot

With all the talk of illegal immigrants today, I was astounded to learn that California has always had a large immigrant population. In the 1860s, 39% of California’s populace were immigrants with this number slowly declining to around 13% in the 1990s. With the rise in immigration recently, today 22% of California’s populace were born outside of  California. Put in perspective, today we have less foreign born Californians (by percentage) now then we did 100 years ago. So why the big fuss? Have we lost sight of who we are? Are those of us who achieved prosperity by the opportunities provided by America now trying to close the doors on others who have a dream?

All the best!
All the time!
JT

I was listening to Fresh Air on National Public Radio this morning while driving between clients and they were discussing the Spanish Court’s investigation of the Bush Administration’s role in the torture of prisoners detained at Guantanamo Bay. What caught my attention was the discussion of SERE School (Survival Escape Resistance and Evasion) having been used as justification for approval of torture. As a SERE graduate, I found what I heard somewhat disturbing and perhaps a bit misleading.

It was 1984 when I went through the US Navy’s SERE School as an Ensign, just prior to reporting to Patrol Squadron Forty as a Naval Flight Officer. At the time, all Navy Aircrewmen were required to go through SERE School to prepare them for the harsh conditions we were likely to face if captured by the enemy. The training was modeled after experiences that Prisoners of War (POWs) experienced in both Korea and Vietnam.

During this time, I remember how the North Vietnamese and Korean prisoner of war camps were portrayed. I can without a doubt say that the vast majority of naval officers felt that the techniques that were utilized on captured US military personnel were barbaric.

SERE School was not something you wanted to go through twice. It was a joke amongst Naval Aviators that our SERE School diploma was the only training document that we kept multiple copies of, to ensure that we could always prove that we had been through it so we wouldn’t have to go through it again.

SERE School was a week of intense training and included classroom activities as well as field exercises. The last part of the training was a survival and resistance exercise in the field. During the final 24 hours of this exercise, we were held in a mock POW camp. I say “mock”, but the line between reality and training was blurred pretty well.

Before I get into any specifics, I want to make it very clear that while intense, this was some of the best training I  received while in the Navy. The instructors, while intimidating, were consummate professionals. There were checks and balances throughout the program to ensure that while were we being tested, that we were in no way going to go through something we wouldn’t survive.

As part of the training, we had eaten very little and endured being in the field for a few days before being placed in the POW camp. We were tired, hungry, sore and of course filthy. The last 24 hours started off with a simulated plane crash and our release into the woods to practice our evasion techniques. If we were able to reach certain checkpoints undetected we were rewarded with a peanut butter sandwich.

Eventually, everyone entered captivity. If you were fortunate enough to escape the search parties who were firing weapons (blanks of course) and walking German Shepherds around the exercise area, you still had to surrender when the “all clear” siren sounded. Upon our capture, we were blindfolded and unceremoniously tossed into the back of a cramped truck which took us to the POW compound. Upon arrival, we were given War Criminal Numbers (I was War Criminal 62), and shoved into our little “spaces” (about the size of a dog house) which would be home for the next 24 hours. During our brief stay there we were interrogated and subjected to different kinds of simulated torture.

I don’t know what portions of the training have been declassified, so will stick to waterboarding as it has been in the news so much that it is basically common knowledge. Yes, we faced waterboarding in SERE School. Not everyone thankfully. But some did. During my class, one of our students was scheduled to become a SERE Instructor. He was subjected to much harsher treatment than the rest of us. Not as a right of initiation, but to ensure that he knew all aspects of the training and could relate to what the students were going to experience. I still remember watching him being placed on a board, strapped down, a washcloth placed over his mouth and water poured over his face till he was gasping for air. All I could think of was, “I hope I’m not next!” Thankfully, most of us were spared the waterboard.

While waterboarding in training may seem barbaric to some of you, let me remind you that back in the 1980s, the memory of torture of POWs in Vietnam and Korea was still very much alive. To think that we would be spared this kind of treatment if captured, was just a bit altruistic. The world can be a very nasty place. This training helped prepare us mentally if we were ever unfortunate enough to be captured.

What saddens me though, is how the US has now become like so many of our enemies of the past. This is going to upset you fans of 24, but I can’t stand that show because it advocates the use of torture to gain information, or to achieve a “higher” purpose. We need to be very careful in what we begin to believe is an acceptable course of action to achieve a purpose, no matter how honorable we might think it to be.

I remember watching the Hanoi Hilton (a film about the POW experience in Vietnam) and cringing at the torture that was dished out. It made me proud to wear the uniform of a US Naval Officer. Why? Because we were different. We were the ones being tortured and not the ones dishing it out. On a positive note, I was elated to here that all branches of the military advised the Bush Administration against the use of torture in Guantanamo Bay. The military knows it is a Pandora’s box. If we torture others, our servicemen and women will also face torture.

I know, there is the ultimate question. “Would you torture a terrorist or criminal if they knew the whereabouts of a nuclear bomb that was set to go off?” That is a tough question. However, I will say that research has proven that information gained under torture, is usually unreliable. How do we ever know when someone is telling the truth? My guess is that if someone was stupid enough to plant a nuclear device somewhere, that they would be insane enough to resist telling the truth. At least until it didn’t matter.

What I found disturbing in the NPR broadcast, was that SERE school was used as justification for using torture on the prisoners at Guantanamo Bay. That it portrayed the torture methods used during the training as safe. That US personnel had survived it. What we faced at SERE School was a simulation. Yes it was harsh, but it was safe. However, I don’t know how I would have fared, if SERE School had lasted a year, and I was in a very different state of mind because my captors were real, instead of trained instructors. Going through one week of SERE School was bad enough – a year without constraints… a different animal.

Can we as man, not even agree that torture is always wrong??

All the best,
All the time,
JT

Event

In 2007, McKay Hatch was a 14 year old Freshman just starting High School. He was tired of listening to the constant cussing by most of his friends and challenged them to stop. The result? The No Cussing Club which now has over 20,000 member around the world.

Leadership Principle

There are two principles here… 1) You have to stand up for what you believe. 2) Leaders don’t let things get in their way (in this case McKay’s age).

Reflections

1. I am surprised by both the positive and negative reaction that McKay has generated. On the plus side, it is encouraging to know that kids and teens are willing to stand up for what is right. On the negative side, McKay and his family have received death threats over the No Cussing Club. I find it hard to fathom, that someone feels so strongly about cussing that they threaten a young teen to stop trying to bring civility to the world.
2. I have a confession. At one point in my life, I cussed… a lot. They didn’t come up with the phrase “cuss like a sailor” without cause. Having been a Naval Aviator… nuff said. However, at some point along life’s journey, I started to realize that cussing wasn’t such a good thing. That it made people uncomfortable and just showed immaturity and a lack of class.
3. I have run into cussing in the workplace, and it was never a good thing. It always reflected a cocky attitude that prevented others from speaking their minds. Groupthink or a hostile work environment come to mind.

Challenge

Is there cussing in your organization? Is it appropriate? If you think the answer is yes, why do we teach our kids that it is wrong? Stop the cussing in your organization – only good things will come of it. At one client, we started a cussing jar and anyone who cussed during a meeting had to fork over some cash. We used the cash for a pizza party.

McKay and Dr. Phil

All the best,
All the time
JT

I just finished reading an article written by Thomas Friedman called Are We Home Alone?. The article, an Op-Ed in the New York Times, was about the lack of Inspirational leadership in our government and corporations. Friedman’s comments were well put and timely. I want to expound just a bit on his basic premise that Inspirational Leadership is the answer to our country’s woes at the moment.

Friedman quoted Dov Seidman who said, “Laws tell you what you can do. Values inspire in you what you should do.” He then goes on to say that it is a leaders job to instill in us these values. I couldn’t agree more. However… Houston, we have a problem.

Exactly what “values” are we talking about here? As a country, we have lost a common sense of values that is the underlying fabric of our society. I don’t want to get into an argument over what these values are, that clouds the issue. The significant thing to remember is that we, and more importantly, our leaders, have lost sight of what is right and wrong. An inspirational leader, will only solve our problems if those in Congress and our Corporate CEO’s are willing to follow a common set of values. Clearly… they are not.

Barak Obama was elected President because the majority of Americans want change. We are sick and tired of business as usual. It is emotionally exhausting to pick up the Wall Street Journal everyday, only to find another leader in Congress or Corporate America looking out for their own interests, at the expense of the rest of us. Is our common value system  based on the premise, look out for numero uno?!

We need more than Inspirational leadership. A leader with Courage to bring about change is what we need! I watched the AIG incident with great interest? Why? Because it was a defining moment for our country, and we blew it. This is a collective we. Barak Obama, Congress, AIG CEO Edward Liddy, AIG Board of Directors and the AIG employees. What happened at AIG (not to mention Merril Lynch and all the other poor leadership spectacles over the past 5-10 years) is a telling tale of the future to come.

What should have been done? Edward Liddy should have been asked to resign. The bonuses should have been rescinded. The Board replaced. I’ve heard the arguments as to why the payments had to be made. Yeah. Right. Barak and Congress should have challenged them. Take them to court. Make them pay. Even if we lose, it sends a clear signal that behavior like this will not be tolerated. What really happened? We blinked. This behavior will continue for the foreseeable future, with only the Public paying the price.

All the best!
All the time!
JT

I recently reviewed the videotape of Oscar Grant’s shooting and am appalled at the response that the Oakland Police Dept. has made. I understand that every law enforcement agency has its policy and procedures for handling shootings, and that there is probably a small team of investigators working on this case right now. However, regardless of the guilt or innocence of Officer Johannes Mehserle, the leadership at the police department has made a huge mistake in how they are handling this crisis.

Assuming that the department is being run efficiently (giving them the benefit of the doubt), the officers at the scene of the shooting should have been trained to tell the truth in their internal reports made right after the incident. From the videotape, it appears (although this is in dispute) that Oscar was handcuffed and lying face down on the ground when he was shot by Mehserle. This is important, but almost irrelevant. Why? Because the video clearly, without any doubt whatsoever, shows that the officers were not in any immediate threat, that Oscar appeared to be cooperating with them, and that he was shot at point blank range, in the back, without reason.

Now, Mehserle may have felt threatened, he may have lost his nerve, or a countless number of other scenarios are possible – however, the initial reports filed by officers at the scene should have reflected that there may have been reason to suspect that a mistake was made.

I have not seen the internal reports, but here is the first hint of poor leadership. If the initial reports filed by the officers at the scene made no mention of the possibility of an error being made, then the police chief is not doing his job. If the reports are not accurate, the integrity of every police officer will be questioned. Let’s look at this from the opposite perspective – that the internal report was accurately filed and that there was an indication that a mistake had been made.

If the report was filed correctly, indicating that there were questionable circumstances involved, the officer in question should have been immediately taken into custody while an investigation was carried out. This does not mean that the officer is presumed to be guilty. What this action would have demonstrated is that the police leadership has as much respect for the victim as they do for its officers. Officers are paid by taxpayers to serve and protect… the people. All people. By failing to put Mehserle into custody, the police leadership are clearly sending a signal that they are protecting their own, regardless of the cicumstances.

I understand that this course of action would not be possible in all shootings. It is also clear that you don’t want officers to hesitate to respond with the appropriate amount of force, including discharging their weapon if and when necessary, because they fear they will be reprimanded. However, if good leadership is in place, there would be a mechanism in place to quickly and efficiently determine when to place an officer in custody after a shooting under questionable circumstances.

So regardless of the accuracy of the reports, the incident indicates that poor leadership exists. Either the reports were filed incorrectly, or they were filed correctly but appropriate action was not taken. But wait, there is more. The next indication of failed leadership is that as of today Mehserle is free (although he did resign from the force). I viewed the videotape and it gives a lot of credence to the claims that Oscar was killed unnecessarily. Because of the nature of this shooting, as soon as this video was released, Mehserle should have been placed in custody. If the situation was reversed, and an officer was shot by a known suspect, the suspect would without question be apprehended and put into custody. So what makes this any different?

What course of action would I recommend?  The mayor should terminate the police chief and immediately take Mehserle into custody and expedite the investigation to have it completed within a week.

Leadership has failed on many levels in this case. Oakland’s Mayor Ron Dellum would be wise to consider how other organizations have responded to public relations fiascos successfully in the past. A great example would be how Johnson & Johnson responded to the Tylenol scare back in 1982.

All the best,
All the time,
JT

I tend to be a contrarian which often puts me at odds with mainstream thinking. How we deal with rescuing the economy is no exception. While I certainly don’t want to see anyone lose their job or be put on the street, I’m not sure spending $2 Trillion is the answer. What bothers me most is that a great majority of our nation’s leaders are saying, “we have no choice”. How I translate this is…

To maintain our current standard of living (which is excessive and what got us into this mess in the first place), we have to throw a ton of money at the economy so that the consumer will start spending again.

What does Moral Courage have to do with this? Well, no one wants to commit political suicide by telling the American consumer that our eyes were bigger than our stomachs, in other words, we  bit off more than we could chew. It was a drive to excess, to grab whatever we could regardless of the cost, that got us into this mess. The current financial rescue package is trying to get us back to that point. How wise is that? To return us to a status quo that drove the economy into the ground.

It’s not that I’m against having nice things, even lots of nice things. But, I do have a problem when the system gets out of whack. As an example, I bought my first house when I was in my early thirties. A few years ago, my then teenage son had a friend whose parents bought her a house… IN HIGH SCHOOL! Now, I know that is the exception, but you get the point. Our drive to “have it all” is what put $200+ jeans on the market and is what caused people to invest in things that deep down inside they knew were very risky.

Perhaps we would be better off in the long run if we went back to a simpler time. When we had to save and work for the finer things in life. We are beginning to bemoan the fact that our standard of living is certainly going to decrease. However, we should be reminded that the vast majority of Americans are probably in the top 5% (10% for sure) of the world’s population when it comes to having not only things, but a place to live, food and a relatively crime and war free place to live.

Perhaps part of the answer to our problems is that we simply couldn’t afford the lifestyle we were living and that a return to it is not the best choice. I know our leaders are talking about preventing the economy from entering a depression, but as I sit here at Starbucks, there is still not an empty chair in the room and while people have cut back, most certainly aren’t starving.

Moral Courage is needed to slow down, just a tad, and ask ourselves why we “have no choice” but to spend $2 trillion. Not popular I know – but certainly needed.

All the best,
ll the time
JT

I’ve been reflecting on the current financial crisis that in retrospect will be a great turning point in the course of our nation. The ease with which Henry Paulsen was granted access to $700 Billion, and the lack of accountability in how it is being spent is mindboggling. To watch the government purchase private corporations because “they are too big to fail”, with little regard given to long term effects of how our system of capitalism will function, is heart breaking. Our way of life is changing… forever.

I believe that our country will survive and that it will strive to take care of its citizens. But life will be different. The question I ask though, is how did we get here? The answer is not an easy pill to swallow because the breadth and scope of the number and types of people involved. There are too many people at all levels of society who did not act according to the leadership principles put forth by the RC³ model. Too many of us didn’t practice, Responsibility, Courage, Commitment and Cedibility.

Let me just tackle Responsibiliy in this posting. Responsibility can be broken down to:

1. Responsibility to Society
2. Responsibility to Others
3. Responsibility to Self

The breaking points are easy to find. Just think if all involved had been considering their responsibility to others and society just a little more seriously. There were so many warning signs and so many opportunities to avert this meltdown, if only we as a society had taken our eyes off of ourselves for just a moment.

To avoid other meltdowns like this in the future, we need to revisit basic principles of behavior. We need to start not only teaching these values, we need to start living them. What about you?: Are you a true leader who exemplifes behaving responsibly? Are you responsible to Society? Others? Yourself?

All the best!
All the time!
JT

While surfing the internet, I came across an interesting website hosted by Carl Icahn. For those of you not familiar with him, he is listed at number 20 on Forbes’ list of richest Americans. He has a reputation, some of it not so great, as being greedy and arrogant. The Wall Street Journal (WSJ) today called him a Corporate Hell Raiser. I can’t speak to the past, but I believe Mr. Icahn now “gets it” (I’m sure he’ll sleep better knowing that I approve).

In the interview with the WSJ, he says that most company boards are dysfunctional and have been for some time. He is now calling for more corporate accountability in how companies are managed, and I think he may be on to something. Being who he is, he has a better chance of bringing about change than you or I do – at least at this point in time.

I hesitate to write this, because no one can tell the future. I also don’t want to be a doomsayer. However, I think things are going to be worse, much worse, for our country. I don’t think that Paulsen or Bernanke quite understand what has happened, mainly because they are too far removed from the financial situation of the average American.

What has happened?

1. Over the past 5 years, the average American saw their wealth, their financial self-worth, sky rocket… then plummet. As an example, a house worth $200,000 in 2000, was worth $600,000 in 2005. Now, it is probably worth about $200,000 again. People lost a LOT of money. If not in actual dollars, in their psyche – they became destitute.

2. People used their equity to live a lifestyle they couldn’t afford and went into debt based on home equity loans and credit cards. Now they have negative net financial worth.

3. The stock market crashed and people lost 30-50% of their retirement savings (It’s not over yet!). Yeah… I know, it’ll bounce back. BUT – with baby boomers losing that amount of money, and with a compressed retirement timescale to make it up, they are going to be very very very risk adverse. This money is not coming back into the stock market because of #1, #2 and this point #3.

4. Deathspiral – American consumers cut back on spending (Look at October’s numbers on consumer spending. It was the largest decrease EVER recorded) causing investors to hold back capital, causing corporations to close stores/factories/offices, causing loss of jobs which causes American consumers to stop spending. You get the idea.

5. Local and State governments will flounder financially. Lack of consumer spending and urban growth is causing shortfalls at the State and Local Government levels. We will be seeing some of these start to file bankrupcy next year. Then the bonds that people thought were safe, will no longer be safe and there will be another crisis. As an example, many cities and counties took out bonds 5 -10 years ago to accomodate the growth of suburban America, fueled by the housing boom. Now, those homes are either empty or not built. The revenue that they were expecting in property taxes and water, sewer, electrical fees is not coming in because of this, and many are going to have problems paying their bonds due to the lack of funds. This will cause further problems in that government will shrink, causing layoffs, causing more Americans to cut back on spending….. see #3.

6. Lack of Leadership in Congress at both the State and Federal levels. These guys and gals just don’t get it. In California, they are taking irresponsible, untenable positions. The hard lines of no new taxes (Republicans), and no cuts to benefits (Democrats) are anti productive. We need to do both. The quabbling by these supposedly smart men and women is going to delay any real action from happening. It is going to take TRUE bipartisan support to put something in place that will help to avoid financial melt down at all levels of government.

7. Wrong focus of the bailout package. I don’t understand this. Well, I do – and it makes me sick. I remember the package being sold to Congress with the cry of Chicken Little. Paulsen said in October.. if we don’t have this package by next week, the world will end. Banks will freeze, lending will stop. Well…. of the $700 billion, we’ve only spent a small portion of it AND – in ways that are completely different than originally intended. While Paulsen will tell us the crisis was avoided, how can that be when it took over a month to spend the money, and only a small portion of it? What did the Feds actually do that made a difference? Which tells me that they didn’t really understand what was going on at the time, and panicked. They wanted a slush fund of $700 billion (1/10th of our National Debt!!) to fix something they didn’t understand. Just this week, they gave some money to American Express (Are credit card companies the next victim to the cycle?) and are thinking about bailing out the auto industry.

8. Failing Healthcare system. I have a friend who is undergoing treatment for cancer. She told me, one… ONE… chemo treament costs $9,000! That is a lot of money. Even though she only pays a co-pay, someone is footing this bill. How is the average American going to afford healthcare… AND continue to spend on the luxuries that we used to in the past. There are some that suggest all Americans have to do, is spend more money to get us out of this financial mess. That may have worked in 2001, but it won’t this time. Times have changed.

8. Same bat channel, same bat time (for you Batman fans). Ok… when are we going to get serious about holding managers and leaders accountable for their actions. Which brings me back to my original point about Carl Icahn. Capitalism, our way of life, is at stake here. I certainly don’t have a problem of people making money. Lots of money. However, it is a crime.. really… for CEOs AND upper management to walk away with hundreds of millions of dollars EACH when their companies are going down the tubes. Think of it this way, my lone consulting busines… me… John… made more money than GM, Chrysler and Ford combined. I don’t think I’m taking home a $200 million bonus this year. We need to hold people accountable.

I can’t predict how all this will play out, but I do know that poor corporate and government leadership got us here. We need to do more to help insure that this doesn’t happen again. Check out Carl Icahn’s Website and join his United Shareholders of America.