March 22, 2003
From the desk of Jane Galt:Can a businessman make a good president?
Dwight Meredith says that being a good businessman doesn't qualify you to be president, and he doesn't understand why people think it would. And that's true; the skill set isn't all that transferrable. (You don't get to pack the board with people who owe you, and also, there are 545 of them, roughly half of whom will be looking to get you fired at any given time.)
But I'm not sure that any job really prepares you to be president of the US.
We get a lot of our presidents from the governorships. But being a governor means that you know absolutely nothing about foreign policy, because no one really cares what Arkansas's position on dollarization or the ABM treaty is. (Except for Massachussets, which occasionally likes to try to run its own trade policy, but its people are unelectable in the current political environment.)
Being a senator or a congressman is also a popular route, although it hasn't worked for anyone since Nixon. But while a senator is probably well acquainted with the policy issues of the day, he probably also hasn't run anything larger than a committee in his entire life. Most of us would like to believe that we could step in and run IBM if we could just get the board to see it, but as anyone who's managed a significant number of people knows, being an executive is very, very different from being a peer leader, even when you're very powerful. Also, the nature of senatorial politics is such that a successful senator is likely to lack vision, propose only things that can get passed and worry a lot about procedure over substance. They also tend to focus on a couple of things that will get them on camera, rather than developing broad policy agendas. This is what killed Dole, and in the end, I think also McCain -- he only had two issues, and one of them was getting his colleagues in the Senate to sign a campaign finance bill they hadn't read. Also, a senator comes into office owing a great many people a great many favors, which is probably not a good thing.
Being in the army works if your war was popular enough -- but while a general is likely to be good at being commander in chief, and possibly at foreign policy, generals aren't likely to be much good on the domestic front; their entire experience with the social and economic side of things is command and control, which doesn't work as well when you can't have people imprisoned for ignoring you. Also, thank God, we don't have enough large wars to produce many generals with any chance of getting elected.
George H. W. Bush ran the CIA. Probably guys from agencies like this are wizards on whatever their specialty was: foreign policy, energy policy, social services. But being in an agency like that is almost certain to produce tunnel vision after years of fighting for your agency in the back halls of Washington. Also, while managing an agency gives you executive experience, it's not quite the same as running a state or a company; for one thing, you're accountable only under the most severe duress, and for another, you're usually not carrying out your own ideas, but those of Congress or the President.
Businessmen don't know how to do politics, but they are almost certainly more knowlegeable about the economy and business issues than the politicians are, who have gotten all their economic news for the last 30 years filtered through sound bites and lobbyists position papers. They also know how to manage a large organization, if they're successful, which is no small asset in the Oval Office. I don't say that it's particularly likely that they'll succeed, but I don't see that it's foreordained that a businessman in the Oval Office would fail, either. Except, of course, that the ones who are willing to try seem to be somewhat crazy. What that tells us about the politicians who run, I don't care to think about.
Posted by Jane Galt at March 22, 2003 10:19 AM | TrackBack | Technorati inbound linksOne thing that good businesspeople have in their favor is that successful ones surround themselves with good people and trust those people to do their jobs. I think that we're seeing this kind of behavior from our current administration in that the President lets his advisors do their jobs and trusts their expertise.
> But being a governor means that you know >absolutely nothing about foreign policy, ?>because no one really cares what Arkansas's >position on dollarization or the ABM treaty is. >(Except for Massachussets, which occasionally >likes to try to run its own trade policy, but >its people are unelectable in the current >political environment.)
Interestingly, Texas also has a foreign policy, at least regarding Mexico, so Bush had at least some experience in foreign affairs from the governor's office. I imagine California, Arizona, and New Mexico have similar.
http://www.sos.state.tx.us/border/index.shtml
Keeping in mind that we're talking about ELECTING our presidents.
So, a businessman who can get elected to a political position is a different animal from a businessman alone. Such a person not only can run a business and (presumably) pick subordinates, but can also persuade people to:
1. Give him money;
2. Forge coalitions (first, within his party) among diverse groups
3. Assume more perspectives than his own/his business' (see "2").
Again, that doesn't make every businessman, or even every businessman-turned-politician into someone suitable to be Prez. But it's more than "just" running a business, too.
You cannot be a good president unless you are a good executive.
Aubrey covered the how important it is for an executive to have good people around them. To go along with that, you must be decisive in replacing people who are not good.
A good executive must not be bound up in detail. An executive must communicate her principles and goals and then delegate. An executive must be free to make the important decisions. But the most important, she must be decisive in making decisions. The people under her also have to be decisive.
Bush is an excellent executive. He follows principles of good management. Reagan did too.
Two other points:
Good CEOs do not run their companies to please the board. They run the companies to please their customers. The large corporations have more customers than the countries in Europe have citizens. They are used to providing value to huge groups of people just as the president has to.
Foreign policy is not that difficult providing you have good experts on your team. The president has to establish broad principles and let the experts advise him.
The paragraph on generals touches (at least a little) on my least favorite kind of leader: the micromanager. There's a couple different kinds of them -- the best, most recent example was Al Gore. Didn't trust his campaign staff at all, was into all the small details (designed his own campaign buttons) and simply couldn't keep his hands off the levers. Aren't you supposed to leave all that stuff to your chief of staff to deal with?
It seems that a ideal modern path to the presidency would include time in the military, a policy-heavy stint as a Senator and a subsequent governorship marked by economic growth and maybe a big natural disaster or two to respond to. (I'm kidding about the last one.) If McCain was five years younger and ran for governor of Arizona this last cycle, the rather negative tune I sing about him would change significantly, I suspect.
Problem with being a successful CEO these days: If you're really successful, you're going to be uber-rich and rightfully so. Because you're uber-rich, your motives for running for Prez are immediately suspect.
I think the Perot experience is going to guarantee that anyone else who tries the "endless personal campaign funds" approach to becoming President is going to get put under the microscope and the protoscope by the media. If Perot hadn't dropped out of the race for a while, hadn't picked someone who (while having a personally heroic life) made Dan Quayle look like Daniel Webster for his running mate, and (most importantly) sounded a tad less unbalanced during the last months of the campaign, he might well have been elected President. That's a scenario that still makes me shudder when I think about it--as much as I loathed and still loathe Clinton, I'd be the first to say that I think Perot would have been worse.
There are generals, and then there are generals. Eisenhower needed immense political skills in order to manage the Allies in the European Theater; any who think he was able to simply bark out orders, and have them followed, is extremely naive as to how international military coalitions operate. Truman ( and who would have predicted he would display as much skill as he did?) , ironically, had this naivete, and thought Eisenhower would be stymied by political infighting in Washington, D.C.. In reality, by the time Eisenhower moved into the White House, he had as much experience in dealing with political factions and bureaucracies as any person has ever had.
MacArthur, who many believe (wrongly, in my opinion) to be a superior general to Eisenhower, would have been an absolutely awful President, which, thankfully, most citizens recognized. His military career, while often brilliant (I think Mac Arthur's failures are often overlooked), was not similar to Eisenhower's, in regard to developing political skills. No doubt his duties in the Phillippines, prior to WW II, were difficult, and his accomplishments in WW II gigantic, but those roles lacked the political dimension that Eisenhower was confronted with.
Mac Arthur, of course, eventually beacme jealous of Eisenhower, labeling him "the best clerk I ever had", which ironically touches upon some of the very qualities that made Eisenhower effective; a quiet competence and knowledge of himself and others, along with an ego under control. Of course, what makes people effective also often contains the seeds of weaknesses. Eisenhower was no visionary, which probably was his greatest weakness, and led to him being behind the curve on civil rights, among other things, although his employing the 101st Airborne (can one imagine the hue and cry if the current or the last President went to such lengths?) to enforce the Supreme Court's Brown decision certainly was not the act of timid man.
Jane:
Being a senator or a congressman is also a popular route, although it hasn't worked for anyone since Nixon.
Heck, since Kennedy. Nixon was an ex-veep.
But experience as a businessman is a good thing to have on the resumé. "I've met a payroll", and all that. George McGovern, who went into business after leaving the government, was rather disagreeably surprised by the burden of the regulations he had to deal with.
Likewise, experience in the military is a good thing, even if not as an officer. Perhaps especially not as an officer.
Bill:
Before serving as Veep, Nixon served in the US House and the US Senate from California. It was while serving as Senator he was selected Eisenhower's running mate in 1952.
Echoing many of the sentiments expressed above...
"... being a governor means that you know absolutely nothing about foreign policy, because no one really cares what Arkansas's position on dollarization or the ABM treaty is. (Except for Massachussets, which occasionally likes to try to run its own trade policy, but its people are unelectable in the current political environment.)"
Many governors have to deal with international issues of trade, finance and immigration policy as well as having a comparable executive job in a republican form of government. Governors of large states have jobs more demanding than those of many national leaders on the very issues which confront the executive of the US. Social policy and economic development are also issues they deal with.
"... while a general is likely to be good at being commander in chief, and possibly at foreign policy, generals aren't likely to be much good on the domestic front; their entire experience with the social and economic side of things is command and control, which doesn't work as well when you can't have people imprisoned for ignoring you."
A primary concern for military leaders is logistics, an army marches on its belly. For a professional army social issues are very important since those professionals have families, careers, health issues, educational issues and retirement needs. The vast majority of the time is spent at peace rather than war and maintaining readiness is a task that demands social, economic and political skills.
"Businessmen don't know how to do politics..."
A fair amount of executive activity is politics and statesmanship. This is especially true in large, multi-national companies.
Meridith fails to understand executive government. When he asks "Is there any evidence that a person with experience only in the area of business would be a successful President?" one need only consider the structure of the executive branch to find close parallels. A CEO is not necessarily a lawyer, accountant, salesman or engineer. The job is to coordinate the activities of such domain specialists for profitable ends, to provide direction and vision. The various departments of a corporation are comparable to civil service organizations which are present when an executive, or president, assumes control and will be there at the end of the term.
Businessmen, generals and governors all do executive work. They may have experience in a particular domain such as law, sales or even engineering but this is not required or sufficient to executive needs.
Meridith is mistaken when he says that "Most attempts to transfer excellence from one field to another meet with failure." Every person that has worked up through organizational ranks, who did not inherit control, has held a variety of positions during their careers. Excellence in work skills, especially study skills and analytic ability, are precisely what each brings to new positions. This is also the fundamental premise of education. In a fast paced world the specific bits of knowledge gained in school soon become secondary or even obsolete but work habits pay life long dividends. Imagination tempered by discipline, the ability to make bold moves as well as stick to the knitting, are attributes of excellence of all types. There are certainly many failures. There are far fewer high executive positions than there are aspirants and applicants for the jobs, but this says nothing about skills transference.
Meredith's confusion about executive skills is most evident in the statement "...instead of running for President, he should first run for the school board." There are many ways to acquire the low level political skills and committee membership experience provided by local political positions.
Successful business people tend not to run for office for these reasons:
1. They are happy being business executives. Since they have power they don’t hunger for more.
2. They are too impatient. They are used to giving orders and seeing things happen. Bureaucrats do not react to an order. The best you can hope is that they drift in the right direction. This drives business people nuts.
3. They don’t want to take abuse from the press
4. They have high self-esteem so they don’t need to prove anything to others by winning an election.
5. They believe in limited government so they don’t see any need to help government do better.
If we were all sitting on an executive search board and listing qualifications, the above discussion would begin to serve. But the whole point of a democracy is that ANYONE is eligible for the job. All the candidate has to do is generate enough support to draw more votes than the competition. That's why unlike the French (who seem to think that only the alumni of two schools meet the high standards of office), the whole American electorate has to be considered in the campaign, and it's that electorate who provides the unwritten list of qualifications for Presidential candidates.
And despite the groans and sneers from the NPR crowd, that electorate frequently enough does a pretty good job at presidential selection.
He makes some good points...but I could argue that being a *lawyer* is even worse background..
1) Lawyers tend to see things in terms of verbal formulations, rather than in terms of what actually happens. Hence, so many of our Congressmen have seemed more concerned about the wording of resolutions than about whether we all get blown up with WDM.
2) Lawyers usually don't have much experience in serious management; they tend to be individual stars rather than team leaders.
Obviously lots of exceptions..these are general points.
i'd argue that one facet of bush jr's business experience has taught him to hire/appoint "executives" that are good at what they do. look at the people he has on his cabinet -- quite arguably the best possible people for each position.
first class people hire first class support.
second class people hire third class support.
a single person can't know and do everything -- domestic policy, foreign policy, economics, blah blah blah. the best thing to do is get the best people who know what the hell they're doing -- provide them with direction and structure -- and let them go to work.
CEOs are the generals and statesmen of their companies. Here's an example: A company with Argentina like economics tried an Argentina-Falklands strategy and attempted a takeover of the company I worked for.
Argentina, Inc. thought they could buy my company, keep the cash cow repair and service part of the business, and sell off the rest. These machinations would create useful distractions in their books.
Our CEO (our Margeret Thatcher!) responded by selling the company (surrendering!) to the Germans.
OK, maybe that wasn't a good example. Let me think about it.
I agree with those who have touched upon the most well known skill set of an executive -- the ability to delegate.
But before you can delegate you have to be prepared, you must have great arguments and you must be patient. Delegation isn't simply telling people what to do.
If we compare the management styles of Clinton/Gore and Bush/Cheney we can clearly see a vast difference in the level of preparedness as well as the discipline to not try to overachieve on small issues. Bush/Cheney focus on the large issues and they clearly communicate that they see the actual time and complexity that it takes to implement -- which requires significant project management awareness.
How many times did Clinton/Gore take on a huge project (like health care reform) only to have it sidelined by late-night brainstorming sessions to react to the latest crisis? Clinton/Gore were masters of policy-think, but disasters at policy-making. How many times did they stick it to their own party in Congress (Budget of 93 anyone)? Their own inability to manage complex processes (more than the unpopularity of their agenda) cost their party several seats in the midterms.
They also let small issues suboptimize big issues. Gore focused on re-engineering government which was code-word for suboptimizing government. Instead of tackling fraud and improper accounting, he used his bully pulpit to pistol whip researchers studying bovine methane emissions. Hillary suboptimized the travel office -- it's travel, not space exploration. Who cares if your buddy can do it cheaper? Its such a small cost of the Presidency, why bother with it?
You have to remember KISS was Carville's mantra in the election, not Clinton's and it showed that Clinton couldn't keep anything simple in the presidency.
They spent so much time on stupid issues generating disproportionate press attention that the big issues never got the time they needed. Additionally Clinton thought he could solve everything with a cram session the night before.
Anyone who says business executives don't know politics haven't spent a day in the board room of a large company. The only thing executives don't get exposure to is the electoral math, the vernacular of capitol hill and the intracacies of policy. These are competencies that can be bought and rather quickly too.
A lot is made of how Bush is not mentally up to task, but let's look at Gore. He has zero competitive business experience. He has no idea of what it is like to work up the ladder. No idea what it's like to live with a incompetent manager (with the exception of Clinton). No idea what it's like to have P/L responsibility.
Gore's formative years were spent hopping around divinity school and law school with short stints at a small daily newspaper. He would have never been elected to public office today -- and especially if his dad wasn't a Tennessee legend already. I look at that experience and I say he'd be lucky to be a low-level clerk much less an executive.
Bush on the other hand has a Harvard MBA, has run multiple companies, been a governer of one of the largest states in the country. From a resume perspective, Gore's not even in the same league.
Therefore, it shouldn't surprise anyone that Bush is running his cabinent far better than Clinton ever did.
I look at the experience of political candidates like a VC looks at a management team of a startup -- it's not a science, it's an art -- and the biggest part of the equation is simple: Do you believe they can do the job? Have they demonstrated success in a related field on a smaller scale? Does the candidate have the hard skills that they can draw from to solve hard problems? Does the candidate have the maturity to stay focused and disciplined and not micromanage? Can the candidate select an excellent management team? Can the candidate expose and drive large issues to resolution? Who else is willing to put money behind the candidate? How much? What terms? Finally, do I trust the candidate?
Bush/Cheney have the bases covered. Clinton/Gore did not.
> Many governors have to deal with international issues of trade, finance and immigration policy as well as having a comparable executive job in a republican form of government.
Apart from deciding which folks to bribe, what can Governors do on an international level?
They don't have much influence on the relevant legislative process and even less on the executive process.
Yes, they're more influential than city council members....
"Apart from deciding which folks to bribe, what can Governors do on an international level?"
Perhaps you can gain some understanding by considering how many US states have programs to identify, support and reward companies that export from their states to the world. Search on governor's export award for a quick start. Those governors support exporters through state policy. Agricultural states stress their important exports and manufacturing states stress others. They fiddle tax policy, lobby at the national level, encourage local greats to help by supporting companies, educational institutions and politicians.
Like national executives they're are constrained by vested interests, opposition politics, budgets and other important issues that need attention too. They can't often command so they have to work through others. Their input to the national executive, often jointly with legislators, become critical components of national policy. Some of their influence comes from the ability to affect national elections. State governors as well as large city mayors can sometimes make or break a national candidate through their influence on state party machinery.
A President of the US must first and foremost be an effective executive (to borrow Peter Drucker's phrase). He must be able to see what will please the customer; be able to articulate that goal; pick quality subordinates on whom to rely; and then delegate the execution of the tasks to the subordinates to the maximum degree practicable.
He must be able to see when things are going badly, and have the humility to admit when he has erred: but he must have the determination to win through to the end despite the protests of the faint-hearted, the ass-coverers, the defenders of the status quo.
Seems to me that a good CEO is the perfect guy to have as President. YMMV.
If Bush was such as good executive. Why did all of his businesses fail?
Ok. so it's a rhetorical question. Fact is, that while a good businessman probably would make a good president; Bush was a failure at business, and is working on failing as president.
Bush is 'in charge' of his administration only in the sense that ultimately the orders come from his mouth. The the ideas and plans behind those orders don't come from him. They can't, because he lacks the knowedge and mental acuity to make his own plans.
Like a ping-pong ball in the ocean. He's going to stay on top, but he can hardly be said to be in control of himself, much less the events that are happening around him. Instead, he is the focus of multiple forces; each of the ambitious men supposedly working for him, are in reality manuvering him. I judge that Rumsfeld and Cheney are ascendent at this time.
Aparently Rumsfeld is so comfortable with the idea that he's bush's boss that he countermand's his orders:
http://www.iht.com/articles/90392.html
---quote---
During a White House planning session with his top military advisers late last month, President George W. Bush turned to General Richard Myers, chairman of the Joint Chiefs of Staff, with a pressing question: How long would war with Iraq last?
.
But before Myers could respond, Defense Secretary Donald Rumsfeld put a hand on his arm and said, "Now, Dick, you don't want to answer that."
---quote---
Rummy controls Bush's access to information, and isn't even a little deferential when countermanding the presidents orders. This is not the behavior of a subordinate that Bush has control of.
Bones, also keep in mind that Rumsfeld would probably say what he said in that meeting regardless of who is president. Only someone with a Napoleon Complex would see something as benign as Rumsfeld telling his joint cheif what to say as "countermanding" an order. The fact is Rumsfeld is a perfectionist, he's trying to mold the DoD away from its long held risk adverse, big is better stance and he has the full support of the President in doing so.
Furthermore, I'll take Rumsfeld anyday (who is only interested in results) over Les Aspin and his replacement (who were only interested in how things "looked.").
As for failed businesses, and Bush's track record, I'll take a political candidate who has experienced failure over anyone who has never spent a single day with responsibility for a business (Gore).
It's all TV's fault. Up until the 1960 election political power went to those who could deliver votes. From then on, political power has gone to those who can deliver money.
The press was a major influence before TV. The printed press totally controlled the message. "Never argue with a guy who buys ink by the barrel".
Organized labor was a huge influence because it could deliver votes. Union membership was many times larger than it is today.
State and local politicians and parties were the power brokers. They could deliver the votes.
Television changed all that. Candidates could go directly to the voter without the help of the traditional power brokers. Thus, the new power brokers. The organization that can give $1,000,000 has a lot of clout.
The way the cookie has crumbled is that the Democratic Party has turned to many "special interests" for money. The Republicans, also have special interests but these tend to be far less politically active and far less able to "collect" because their interests are much more likely to be "less government" than government dispensed favors.
Yes, I know about the "Military/Industrial Complex". They, however, concentrate on general and bipartisan influence of the legislative branch because that's where the money is.
This has led the Democrats away from being a consensus party and into something resembling the coalitions that trouble many of the parliamentary democracies. Everybody expects a tangible reward for their support. This in turn has led to the disastrous Cabinets of the last two Democratic presidents.
Clinton insisted that his Attorney General had to be a woman. This is an absurd thing to say, but he was forced to announce publicly the clout of the feminist coalition. I am sure you can think of other examples.
To many this may seem to be a partisan rant. There is an objective test in progress to prove or disprove these observations: McCain-Feingold. If the Republicans are the tools of special interests you can expect their fund raing to suffer. And vice-versa.
When most of the shouting ended and people actually started to think about what they had passed they started to understand that little smile on the President's face as he signed it. Preliminary panicked analysis predicted that the Republicans stood to gain as much as a 25% advantage in fundraising. The first report on fundraising that was affected by the law showed a 3-1 advantage ($12 Million vs $4 Million) for the Republican Party. The Democratic Party said not to worry, they were going to really improve their mailing lists.
McCain-Feingold is the most significant political event in the last 40 years. There's going to be lots of surprises and lots of collateral damage.
" If Bush was such as good executive. Why did all of his businesses fail?"
Pretty obviously they didn't. He's a multimillionaire because the Limited Partnership he put together and managed was fabulously successful.
> Perhaps you can gain some understanding by considering how many US states have programs to identify, support and reward companies that export from their states to the world. Search on governor's export award for a quick start.
I covered that with "Apart from deciding which folks to bribe". And, that bribing is mostly limited to "please build a factory in my state" issues. They don't give a damn about exports - they're looking for local jobs. (The major exception is farm programs, where the state bribes folks to buy food from vendors in said state.)
I have exactly the same power (except that I don't get to spend someone else's money to do so). However, like Governors, I can't change import/export duties/restrictions, affect immigration, wage war, sign treaties, and so on.
Both of us will get in significant trouble if we start granting significant foreign aid and a governor is likely to get in more trouble if s\he institutes a "buy Chinese" program.
The president of IBM has more "foreign policy" clout than the typical US state Governor.
Bones, you say Rumsfeld controls the President?
That's not what I hear.
At the protest I went to yesterday, they said Bush was under the influence of the Jew-run multinational corporations.
Not to pile on, Bones, but Bush was involved in oil exploration, which isn't exactly a field rife with easy success -- it's a career for people interested in calculated risk-taking.
I'll second that: Bush went under when the price of oil collapsed, just like every other wildcatter in Texas.
yeah texas land was CHEAP back when bush went under... massive oil bust.. bumper stickers to the effect of "Please Lord, let me have another boom... I won't screw this one up!"
The single most important thing a person needs to be a great President is leadership abilities. Reagan had them, Carter was the antithesis of leadership. Their terms in office reflected this. Clinton and Bush I were o.k. managers, but piss-poor leaders, resulting in average terms in office that will soon be forgotten. Take a look at the Presidents that are thought of as great, and you will see that each one was willing to stake their political lives and reputations on what they believed to be right and refused to compromise to make things easier.
You can take any 'skill-set' or experience you want, but if they aren't a great leader they will fail horribly.
As an interesting side-note, most of today's flag rank officers will fail spectacularly as a President for this reason. It is the rare person that gets that high in the hierarchy while retaining leadership qualities. Most are good politicians and managers, but poor leaders.
Joe: Damitall, my nine years of experience in the USAF says you are exactly right about the lack of leadership qualities in the bureaucrats that make it to the higher ranks...
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