Perot Knows What Needs to Be Done, but Is He the One to Do It?
“I think we’re at a point that if we ever needed to have a businessman running the place, this is the time,” Ross Perot says.
That’s obvious this year. The Perot phenomenon--a nationwide grass-roots, sign-up campaign catapulting the billionaire Texas businessman to the top of the opinion polls--is not the first sign that voters want bottom-line thinking in the White House.
Former Sen. Paul Tsongas’ appeal in the primaries was that he would get back to running the country on sound business principles--no more wishful thinking and funny money. President Bush and Democrat challenger Bill Clinton are at least talking about spurring investment.
Why the sudden enthusiasm for business? Simply put, the crisis is financial, so Americans believe that it’s a good idea to call on somebody with a knowledge of double-entry bookkeeping. The United States is not threatened militarily for the first time in half a century. Nor does a ‘30s-style Depression really loom over us.
The trouble is more like a slow cancer. “We’ve got a country that’s $4 trillion in debt, adding $400 billion of a deficit this year,” says Perot in an interview last week in his Dallas office. Politicians wring their hands, and voters are fearful.
But business people know the problem is debt that must be repaid from insufficient current resources. “It would be different,” Perot says, “if we had accumulated the debt, but everything was perfect--perfect cities, perfect schools, no crime and we had a booming industrial base. You’d say we’ll work our way out of it.
“Instead, we borrowed the money, and we have problems in our cities and the least-effective public school system in the industrialized world and the most violent crime and so on.”
The threat is that the United States may be like Macy’s, the department store chain in Chapter 11 bankruptcy. Macy’s took on lots of debt in the 1980s when customers were spending big. But in the ‘90s, customers with less money are doing less shopping. Yet Macy’s still has the debt to pay--which is why it sought protection from creditors early this year.
In that light, a look at the United States is not reassuring. Real wages are declining for workers with only high school education. Economists cluck that such an income situation is unfortunate but part of our transition to an information-based economy.
But Perot, founder of Electronic Data Systems and a pioneer of the information-based economy, asks what about debt. If wages, and therefore potential tax payments, are reduced, “is somebody going to cut our debt for us?”
“We’ll be held accountable for paying this debt, which is based on a bigger tax base--based on an American standard of living that is currently slipping,” he says.
Perot’s message angers some who hear it. Yes, there is trouble, says the conventional thinking. But is that any reason to believe that a brash businessman can be President? Politics is a complex task, not a boardroom exercise, goes the refrain; Perot lacks patience or consensus.
The parallel with General Motors is eerie. In 1984, GM bought EDS and took Perot in, hoping his entrepreneurial spirit would energize the big company. Perot attacked the source of the trouble, the managers and directors who had stopped paying attention to making good cars and satisfying customers.
“While you guys sit here, Cadillac dealers are working overtime to fix cars that break down as soon as they leave the lot,” Perot told them.
So they fired the messenger, told Perot to go away. Now, six years later, GM is in extremis, and directors have acted belatedly to shake up the company. It has become fashionable to say that Perot was prematurely right.
Now, it’s important to make a distinction between Perot, the individual running for President, and Perot’s message. Whether Perot belongs in the highest office will depend on voter judgment of his policies and his character. But his warnings on the economy are only common sense.
The message simply is that there’s work to do and it won’t be easy. The national debt doubled in the last decade, thanks in part to the military buildup that ended the Cold War. “The Cold War broke Russia, but it drained us,” Perot says.
Now a transition to peacetime industry must be made; jobs must be created; schools improved.
Perot believes that to increase employment, the United States must make more products at home.
“I heard a brilliant person say that (in the global economy) we may lose industry ‘X’, but we’ll be doing industry ‘Y,’ ” Perot says. “I love the theory, but what is ‘Y’? What industry is it, and is it attuned to the limited skills of the educationally impaired youngster coming out of our public school system?”
Such insights don’t mean Ross Perot should be President, but that somebody who understands that we have painful work to do must be.
Unfortunately, the primary season saw too many politicians still looking for easy ways out. Bringing troops home from Germany and Japan and thus “saving billions” was a favorite theme. But it’s a false promise unless jobs are available for the people discharged from the armed services.
One man, even a can-do businessman, won’t solve the problems, says Henry Schacht, chairman of Cummins Engine--who is even suspicious of the voters’ enthusiasm for business. “It’s looking for a knight in shining armor,” Schacht says. “The problems are amenable to solution, but it’s going to take a consistent and patient effort by everybody to work for the common weal.”
Ross Perot won’t save our bacon, in other words, so we’ll have to save our own.
