Long Term vs. Longer Term in Capitalism

Nine days ago, I posted an entry called Short-Term Gain Vs. Long-Term Value where I expanded on Jack Bogle’s quote, “We need a new compensation system where executives are paid for creating intrinsic value for companies, not for creating stock prices.  It’s amazing how much more difficult it is to build a good company than it is to build the price of a stock.”  And I (along with Bogle…nice to put myself in good company) felt that executives were incented to do the right things to drive shareholder value in the short term, but sometimes at the expense of longer-term shareholder value.  In that case, long-term time horizons for a company were maybe 5-7 years.  But just to be clear, in the even-longer-term time horizons, the track record for capitalism is impressive.

My brother Jeff referred me to a very interesting article in the Financial Times called “Do Not Let the ‘Cure’ Destroy Capitalism” that dovetails nicely onto the topic of time horizons.  In the article, economists Gary Becker (Nobel Laureate ’92) and Kevin Murphy (Clark Medal ’97) point out some of the long-term gains which can be attributed to worldwide expansion of capitalism and free markets.  “Consider the following extraordinary statistics about the performance of the world economy since 1980. World real gross domestic product grew by about 145 per cent from 1980 to 2007, or by an average of roughly 3.4 per cent a year.  The so-called capitalist greed that motivated business people and ambitious workers helped hundreds of millions to climb out of grinding poverty.”  Capitalist greed — it’s a good thing.

This is a simply incredible statistic.  In the last 27 years, the total output of goods and services has increased by 145% in real terms.  So where we could produce a hypothetical $100 worth of goods and services in 1980 dollars, by 2007 we could produce $245 worth in 1980 dollars.  Amazing!  This was a period where capitalism flourished in the West, in the Far East, and (post 1990/Soviet collapse) in the Eastern bloc as well.  Free markets produced growth on an incredible scale.

Our authors go on: “This allowed real per capita incomes to rise by almost 40 per cent even though world population grew by roughly 1.6 per cent a year over the same period. “  The time period they are talking about spans roughly a generation.  My children are currently 10, 8, and 7.  When they are my age, if their per capita incomes on an inflation-adjusted basis are 40% higher than my income, I’ll be very excited for them.  If, on average, the world’s population is 40% better off, I’ll be very excited for all of us.  Can you imagine all the innovations, both meaningfully life-improving as well as just plain cool, that will be available in one generation?  But the gifts of growth are not automatic.  They are dependent on the the seeds of growth, the incentives to innovate remaining in place.  And that is where the free market comes in.  “Output, employment and earnings have all been hit by the crisis and will get worse before they get better. Nevertheless, even big downturns represent pauses in long-run progress if we keep the engines of long-term growth in place. This growth depends on investment in human and physical capital and the production of new knowledge. That requires a stable economic environment. Uncertainty about the scope of regulation is likely to have the unintended consequence of making those investments more risky.”

Our esteemed authors continue their article by pointing out the self-correcting nature of markets.  They note that most government attempts to correct market problems generally tend to prolong them.  As they view today’s landscape, where we have governments engaged in active bailouts, enormous “stimulus” programs (which they discuss as well), and intervention in a whole host of areas, they close with the following statement: “Partly owing to the collapse of the housing and stock markets, hostility to business people and capitalism has grown sharply again. Yet a world that is mainly capitalistic is the ‘only game in town’ that can deliver further large increases in wealth and health to poor as well as rich nations. We hope our leaders do not deviate far from a market-oriented global economic system. To do so would risk damaging a system that has served us well for 30 years.”  Well said, gentlemen.  Well said.

The Value (Punishment) of Being a Current Customer

I love the Wall Street Journal.  Actually, more specifically, I love wsj.com and have ever since it debuted.  I’ve been a subscriber for a very long time.  My subscription renewal recently occurred, and at $149 it seemed much higher than I remembered.  Sure enough, I checked, and last year I paid $119.  For those keeping track at home, that’s a 25% increase in the subscription renewal price.  Just out of curiosity, I checked around online, and I found that I could get a new subscription for $103. 

As a professional in an interactive marketing services company, as a consumer, and as a business owner, I still never cease to be amazed by the strange things that companies do to their customers.  It’s an axiom in marketing that it typically costs at least five times as much to win a new customer as it costs to retain an old one.  And yet some companies seem only too willing to take current customers for granted in their quest to win new ones.  On with the story.

I called the Journal’s toll-free subscriber line figuring that once I mentioned that I’d seen the $103 new-subscriber rate online, they’d gladly honor the new-subscriber rate.  I spoke with a very nice individual.  She was as polite as she could be.  She began by noting that I was sent an e-mail in advance of my credit card being charged, and that the e-mail noted the subscription rate.  I looked back, and she was absolutely right.  Though I suspect that in that e-mail, the renewal rate didn’t grab my attention since it didn’t actually appear until the ninth (yep, ninth) paragraph.  The person I spoke with pointed out all the things they’d done to improve the online Journal in the past year which justified the $30 price increase.  She then pointed out that because I’d been a valued subscriber for so many years, she could give me a $20 credit toward my renewal.  She was so polite.  She did a great job selling the value.  She did a great job making the case.

She just couldn’t change the facts.  What she could offer was a $20 credit toward my renewal, bringing my rate to $129.  What I heard loudly and clearly was that I was being charged a penalty of $26 because of my status as a valued customer.  If I were just David Danziger, coming in off the web as a random visitor, I’d pay $103.  But because I was David Danziger, long-time subscriber, I’d get the special rate of $129.  So the value (punishment) of being a current customer?  Negative $26. 

Like most people, I really only like to pay for things which add value.  The online Journal provides value for me.  I’m not sure what subscription price would finally be too much for me.   The truth is that I’d pay $149.  In my mind, it is a fair price for the value I feel I receive for the online Journal.  But like anything else, if there’s a lower-priced substitute for which I receive equal or greater value, I’ll take the substitute.  In this case, there’s a legitimate substitute available to me at a 30% discount, and the substitute is identical.  It’s the online Journal.  My subscriber number will change, and I’ll need to re-enter some preferences.  But for $46, I’ll manage.  And on principle alone, it will be worth it. 

Part of what makes free markets so successful is that companies and consumers both set the terms by which they conduct business with one another.  If either party does not like the terms, he/she can opt not to engage in the transaction.  Or he/she can find another buyer/seller whose terms are better.  The Wall Street Journal has long been a leader in forcefully espousing the virtues of capitalism.  I love that publication for it!  I still can’t believe I’ve canceled my subscription with them.  But the good news is that they’ll be getting a “new” subscriber tomorrow.  I’m still perplexed as to why they chose to punish me as a current subscriber, which in turn led to them incurring the transaction costs associated with my call, my cancellation, and my ”new” subscription.  But I can assure you, I did not feel like a “valued customer”.

Short-Term Gain vs. Long-Term Value

On March 18th on CNBC’s Squawk Box, Jack Bogle, legendary investor and founder of Vanguard Funds, made the following statement (approximately 1:40 into the interview):  “We need a new compensation system where executives are paid for creating intrinsic value for companies, not for creating stock prices.  It’s amazing how much more difficult it is to build a good company than it is to build the price of a stock.”  Bogle’s reputation as a man of great sense when it comes to investing is well-earned.  His statement above just put into words one of the critical challenges that underpins the current financial woes.

When the various histories of our financial times are written, while there will be instances of fraud and wrongdoing to report on (Madoff, Stanford Financial, etc.), what will be most noteworthy is that most executives were doing exactly what they were supposed to do. In prior decades, philosophical discussions of management compensation focused on the “agency problem”.  Specifically, the questions centered around how to make sure that management (in its capacity to act as an agent for owners) was compensated in a way that aligned its interests with the interests of owners/shareholders.  The solution: managers were given large bonuses for achieving objectives that positively impacted stock prices.  Or they were compensated with stock grants or stock options.  In all of those cases, management’s interests were aligned with ownership interests in that they were compensated for share price appreciation.

So managers at the top firms in the land did precisely what they were supposed to do, and took advantage of near-term business opportunities and made share prices go up.  And guess who benefited?  They did.  They made a lot of money.  And guess who else benefited?  WE did!  That’s right.  We shareholders applauded as we watched our portfolios rise.  I don’t recall too many of us asking whether or not management was really thinking about the company on a long-term basis, or whether or not what they were doing was adding intrinsic value, and we certainly weren’t asking whether or not our managers were considering the company risk or systemic risk of their actions.  As long as our shares were appreciating, most of us either truly didn’t doubt, or we chose not to.  Were there voices out there warning us?  Of course there were.  But as with most bubble-oriented phenomena, we wanted to believe it could last forever. 

• “Of course housing prices will continue to appreciate.  They always have.”
• “Of course overwhelming majority of people will do everything in their power to stay current on their house payments.  They always have.”

As soon as those two beliefs became fundamental premises, then the seeds were housing-crisis seeds were sown enabling short-term gains at the expense of real long-term value. 

• It suddenly seemed perfectly logical for lenders to make loans, and for borrowers to contractually obligate themselves on loans for houses they clearly couldn’t afford (in the long-term) because we all knew the house would appreciate.  So borrowers could re-fi based on the price appreciation and actually profit, and the lender could always get securitization for the loan.
• It seemed perfectly logical for credit rating agencies to to give investment-grade ratings to the packaged loans, because we all knew that people pay their house notes before everything else.
• It seemed perfectly logical for investment bankers to securitize the loans, and to “slice the risk” thinly enough that no single entity needed to be worried about putting itself in jeopardy. 

It all made sense.  It all created great opportunities for short-term gain and even the illusion of long-term value.  People who could never have dreamed of owning a home, much less a high-dollar one, could suddenly own one.  Mortgage brokers were rolling in dough.  Banks engaged in mortgage lending were making big profits for their shareholders.  Investment bankers and those to whom they sold the CDO’s were all making money.  And it would all work as long as the two big premises held. 

But Bogle’s right.  It’s a lot easier to build stock price (or home prices) than to build long-term intrinsic value.  And when it comes down to it (hindsight is 20/20 of course), surely we should have recognized that a house worth $300,000 today should not logically and magically become worth $600,000 in six months under normal circumstances.  But we all wanted to convince ourselves that it was different this time.  We all were willing to believe that short-term gain was indeed reflective of long-term value.  But it was no different this time than it was in any prior bubble.   Just because Pets.com had a fabulous sock puppet in its advertisements did not mean that it had a sustainable business model in 2000.  And just because people could make money buying and selling houses did not mean that there was new, sustainable demand for housing. 

This will not be the last time we explore the concept of short-term gain and long-term value.  We know that capitalism works in the long-term.  We know that there are profits to be made in the short-term.  Finding the was to reconcile the short- and the long-term is surely an art form we’ve not mastered yet.  The current situation shows this all to clearly.

What’s $61.7 Billion Among Friends?

On March 2, insurance giant (loser) American International Group (AIG) posted a $61.7 billion quarterly loss.  Yep.  That’s $61.7 billion, with a “b”, in a single quarter.  In the time since, they’ve been pilloried for awarding bonuses, substantial ones, to employees while simultaneously taking federal bailout money.  Quite a performance.  I don’t want to make this out to be overly humorous, because losing billions from an income statement perspective as well as a shareholder perspective is no joke.  Nor is it funny to have taxpayers footing the bill.  But I must say, it is something of an achievement to actually lose $61.7 billion in one quarter.  That is amazing.  In the spirit of the Well Worth It Blog where, among other things, we examine interesting issues of what’s worth what, let’s explore some other ways to ponder the magnitude of a $61.7 billion loss…in one quarter.  For those readers who are not numerically inclined, this number is $61,700,000,000.  That’s a lot of zeroes.  On with the comparisons.

1. The 4th quarter, AIG’s magic quarter, contained 92 days (including weekends and holidays).  That translates into nearly 8 million seconds.  After some mathematical fun, we see that our AIG friends managed to lose, on average, $7,762 every second of the quarter.  When did they find time to sleep?
2. The newest issue of Forbes (3/30 issue) has its annual article on the world’s billionaires.  Bill Gates regained his crown as the wealthiest man with a net worth of $40 billion.  Rival software maven Larry Ellison was 4th at $22.5 billion.  Word is that before AIG’s huge quartely loss, their management team was actually considering buying Gates and Ellison outright, but then realized they’d come up $800 million short.
3. Question: what does the country of Slovenia have to do with AIG’s quarterly loss?  Answer: Slovenia’s 2008 GDP, meaning all the finished goods and services produced in the entire country, was exactly the same as AIG’s quarterly loss.  In some ways, such a comparison seems unfair.  After all, Slovenia required a whole year to produce that much, while AIG lost that much in a single quarter.  If we annualize AIG’s loss, then their $245 billion puts them closer to Portugal.  Way to go AIG!  (source: CIA Fact Book).  
4. Many people think Exxon Mobil’s profits are obscene.  I could not disagree more.  Compare a company that knows how to take risks with billions of dollars, extract raw material from the ground, refine it, distribute it, and TURN A PROFIT with one that can lose $61.7 billion in a quarter and then require a taxpayer bailout.  Exxon Mobil should be celebrated, thank you.  That may be another post on another day.  But let’s look at Exxon Mobil for a moment.  In their year ending 12/31/08, they made $45.2 billion in net income.  How obscene!  They’ll need to improve by over 36% before their annual profit equals the magnitude of AIG’s quarterly loss.   Wow!
5. Speaking of bubbling crude, black gold, and Texas tea, just how much oil might we buy ourselves with $61.7 billion?  Based on closing prices today, I could buy myself a barrel of Light Sweet Crude (sounds delicious!) for $47.04.  So my friends at AIG, with their quarterly loss, could buy us over 1.3 billion barrels of oil.  The United States uses roughly 21 million barrels of oil per day (according to Pickens Plan.com).  AIG’s loss could have been used to supply our oil for 62 days.  Nice. 
6. Forbes recently did a feature on the priciest colleges.  ”The most expensive in terms of tuition and fees: Washington, D.C.’s George Washington University, with a sticker price of $40,437 for the 2008-2009 school year. ”  No problem if we could deploy AIG’s quarterly loss.  GWU could have had over 1.5 million enrollees this year, all funded by AIG!  Time to expand the campus.
7. Poor General Motors.  They are in a world of hurt, and yet by comparison, they are wealth creators compared to AIG.  In 2008, even including “special items”, GM only (only!) lost $30.9 billion.  That’s a yearly figure.  Don’t forget, AIG lost double that…in one quarter!
8.  According to the U.S. Census Bureau, the current U.S. population is just over 306 million.  If we distributed AIG’s quarterly loss evenly to every man, woman, and child in the country, we’d each be getting $200.  Each of us.  Every one of us.  I know I’m looking forward to my household’s $1,000!  But instead, we’re paying for their error.

I was going to write something about the number of Taco Bell Bean Burritos you could get with the quarterly loss, but I couldn’t quite figure out how to put 62,323,232,323 bean burritos into perspective.  Then I realized an oh-so-obvious calculation that we can all relate to…ponder this one: at 350 calories per burrito, AIG’s quarterly loss could get us 21.8 trillion in bean burrito calories.  Yummy!  Let’s just hope next quarter, AIG management comes through with an improved showing!

P.S.  One final giggle: I had to de-activate the scientific notation function in Excel for those last two calculations.  Great work AIG!

Tax Time and Its Costs

The March 16 issue of Forbes Magazine contained some fascinating information about taxes in Steve Forbes’ “Fact and Comment” section.  You can find the full text of what I’m referencing here.  The snippet includes a number of quotes from the report submitted by Nina Olson, head of the Taxpayer Advocate Service, an independent division within the IRS associated with resovling taxpayer complaints.  It is my suspicion that anyone who has ever filled out a 1040 would not be tremendously surprised by the general tone, but some of the statistics were staggering nonetheless.

“Individuals and businesses spend 7.6 billion hours a year filling out tax forms for the IRS.  ‘And that figure does not even include the millions of additional hours that taxpayers must spend when they are required to respond to an IRS notice or an audit.’”

I admit, I suspect the methods for calculating such figures may be, shall we say, less than precise.  But if we accept that they are within the bounds of reasonability, that’s pretty appalling.  In the vein of what that time is worth, the magazine notes that it’s the equivalent of 3.8 million full time workers.  3.8 million.  That is another enormous number.  Using some statistics on the Bureau of Labor Statistics website, we can reasonably estimate that there are approximately 154 million workers in the active U.S. workforce.  If the time spent filling out tax forms represents 3.8 million full time workers, that translates into roughly 2.5% of the workforce spending all its time filling out tax forms.  Imagine if those individuals could be deployed on truly productive, value-adding labor.  Here’s one more way to contemplate 7.6 billion hours.  In round numbers, the U.S. has 306 million men, women, and children.  So every individual, on average, spends 25 hours (!) filling out forms.  Clearly others must be spending a lot more time than I am doing these, because I don’t spend 25 hours on them.  But I’ll readily admit that I do not enjoy whatever time I do spend on them. 

Why not?  Because while I like to think of myself as reasonably intelligent and reasonably honest, I can’t even tell whether I’m interpreting rules correctly and legally.  The complexity is overwhelming.  “‘As the report states: ‘Taxpayers who honestly seek to comply with the law often make inadvertent errors, causing them either to overpay their tax or to become subject to IRS enforcement action for mistaken underpayment of tax.”  I suspect my tax situation is pretty simple compared to many.  But its complexity is now beyond my capability to handle alone.  No surprise there.  “‘Individual taxpayers find the return preparation process so overwhelming that more than 80% pay transaction fees to help them file their returns.’”  I value what my accountant does, but only as a necessary evil.  Were the tax code simpler, I’d be able to pay my taxes without his help.  The money I pay him could be deployed to more productive uses.  And I guarantee you a capable guy like him could add some significant value in a wide range of areas.  So there is a cost to me (and millions of other taxpayers) and a cost to society driven by the complexity. 

There is ultimately lost revenue to the government as well.  With complexity comes loopholes.  The report, as quoted in Forbes, states, “‘[S]ophisticated taxpayers often find loopholes that enable them to reduce or eliminate their tax liabilities.’”  Government revenues, the original intent of taxation, are actually lost because complexity makes it possible to hide, shield, re-interpret, etc.

So the complexity of the code, according to the head of the Taxpayer Advocate Service:

• Has an enormous cost in hours
• Has an enormous cost in dollars
• Makes honest people overpay in some circumstances
• Or makes honest people appear dishonest in others
• Allows sophisticated taxpayers to avoid certain taxes that they should pay

In short, the unbelievable complexity itself, imposes an enormous burden on American taxpayers, on the American economy, and ironically on the government itself.  I don’t know whether a flat tax is the answer, or a national sales tax, or a simplified graduated approach, or something else (though I definitely have my ideas!).  But I do know that the current approach to taxes is ripe for an overhaul.  What would tax simplicity be worth to you?  To me, simply knowing:

• That I could easily calculate what I owe
• That I could confidently pay my taxes and know that I’d been honest and accurate
• That others were doing the same (because it’s too simple to have an excuse to do otherwise)
• That as a result, the government could collect what it was “supposed to”
• That all the extra expenses currently drained from the economy by the complex tax process would now be freed up for productive uses….

All of that would be worth an ENORMOUS amount.  Tax simplicity.  It’s a good thing.

The BEST Is Yet To Come, Part 2

A couple of weeks ago, I posted an entry called Good News: The Best Is Yet To Come.  The primary purpose of the post was to state my disagreement with a commentator who felt that the current downturn would bring on a permanent change in the American standard of living.  Since then, it feels like there’s been no end to talking-head prophecies of doom and gloom on every news show along with a flood of would-be economic writers espousing the same view (see here and here for examples).  I’ll readily admit that things are not great right now.  And this post, which focuses on a long-term view of why things aren’t going to be horrible forever, by no means minimizes some of the real challenges right now. 

But this post does seek to challenge those out there casually throwing around comparisons to the Great Depression, and particularly those who are determined, on a daily basis, to speak in dire tones and insinuate that we are about to fall into the abyss.  We will be fine.  We will undergo short-term pain, but we will be fine.  The engine of capitalism (because it is driven by an individual’s desire to improve his/her situation) will continue to lead to better things.  Always.  Period.  I don’t agree with everything being done by the U.S. government to ease today’s pain, but that’s another topic for another day’s post.  I do know that policies, good or bad, along with the various challenges presented by circumstance and history can only speed up or slow down our progress.  They can not and will not stop it. 

There is a particular series of economics lectures I like to listen to that reminds me of the long-term, incredible progress that we make in a given period of time.  The fabulous series is called History of the U.S. Economy in the 20th Century, and it is taught by Professor Timothy Taylor.  Professor Taylor introduces the course with some key statistics that painting a picture of economic life in the U.S. in 1900.  He points out the U.S. was already emerging as an economic powerhouse compared to the rest of the world, but that by today’s standards, we’d have considered our ancestors to be in dire poverty.  Try these statistics on for size:

• Only 3% of U.S. houses were lit by electricity and only 1/3 had running water in 1900 (by 2000, both were basically universal in the U.S.)
• Fully 1/3 of the population worked in agriculture.
• Most of the population lived within a mile of work.  They had to since only 1 in 5 urban households owned a horse, and of course cars weren’t an option.  
• Average life expectancy  in 1900 was 47 years; by 2000, it was 75.
• Out of 1,000 babies born, 140 died in their first year of life in 1900.  By 2000, the number was less than 10 per 1,000.  
• Americans regularly died of flu, pneumonia, tuberculosis, gastritis, typhoid, and whooping cough in 1900.
• It was estimated that women had to spend 40 hours preparing meals, 7 hours on cleaning, and 7 hours on laundry per week.  There were (obviously)  no microwaves, electric/gas stoves, or refrigerators.  With no running water, they had to retrieve water from outdoor pumps.
• Per capita GDP in 1900 (adjusted for inflation to Year 2000 dollars) was approximately $5,000.  In 2000, it was over $25,000.  

So over the course of a century that was interrupted by two world wars, the Great Depression, a Cold War, and numerous other conflicts and economic distruptions, we still managed to transform our society in a way that our ancestors couldn’t have even begun to dream of.  We jet from one city to another.  We live in houses and apartments with heat and air conditioning and ovens and dishwashers and televisions and computers and MP3 players and TiVos.  Some of these wonders ease our work burdens.  Some of these make our leisure more enjoyable.  We have an opportunity to actually contemplate a concept of “retirement”, a relatively new concept in human history as most of our ancestors had to work until they died.  This magnitude of change took place in the course of one century.  

Perhaps you think one century is too long to consider.  But we could write this article from the perspective of five years, a decade, or twenty years, or thirty years.  During any of those time frames, the the escalator continues upward.  Our pace of innovation and rate of progress are simply enormous and amazing.  Our economy, our standard of living, and our lives will improve.  Brilliance, courage, determination, imagination, and perseverance will lead the way.  All of these characteristics are part of the American ethos, and all are encouraged by our economic system which rewards those very same traits.

Again, I do not minimize the immediate challenges that lie before us.  Nor do I scoff at the real difficulties for those currently out-of-work and seeking new opportunities.  We’re in a recessionary cycle, but it will soon be followed by a boom.  As long as we maintain a stable money supply, and as long as the market remains free (enough) to reward those who deliver products and services that fill a need or desire, then the seeds of recovery are already sown.  Better days will be here as surely as winter yields to spring.  I, for one, believe the snow is melting and the breezes of spring are coming.  It will be here sooner than any of the doom-and-gloomers believe, and I’m looking forward to it as a family man, as an investor, as a business owner, as an employee, and as an American.

Gross Body Parts and Public Relations

Sometimes we see a headline and we simply have to read the story behind it.  I try to keep my eye on the news items that flow through industries of interest for me.  I was perusing the daily email I receive from Ad Age when I came across the following headline: “Giant Human Colon Makes Times Square PR Debut”.  So, do you think I clicked on the link for the rest of that story?  Darn right I did. 

I was mildly horrified to find that the story was much like what the headline indicated.  “[T]here it was last week, a 20-foot-long inflatable organ beckoning consumers to enter and explore its diseased insides. It was all part of a colorectal-cancer-awareness campaign conducted by the Prevent Cancer Foundation and pharmaceutical giant Sanofi-Aventis.”  Yep.  There’s nothing quite like the idea of walking through a big ol’ simulated colon.  Seriously, there are about a gazillion things I could write about how comical that is.  “What’s that funny smell in Times Square?”  “Who Needs DisneyWorld When You Can Visit the Giant Colon?”  The list is endless.

And that makes the point that I guess the folks at Prevent Cancer Foundation and Sanofi-Aventis were going for.  The fact is that this is something that can be talked about and actually has a “hook” to make it interesting.  Let’s be honest, no matter how critical a subject this is, you could do a thousand seminars pushing “colorectal cancer awareness”, and you’d never get the same kind of publicity you get when you drop a 20-foot inflatable colon in Times Square. 

So what does this tell us?  All kinds of things about what’s really worthwhile from a marketing perspective.  None are shocking.

1. Public relations is mighty important.
2. The unusual is effective and the odd is viral. 
3. Almost no subject is off limits.

Public relations is mighty important.  DUH!  Figuring out ways to get free press is always important.  The unusual is effective and the odd is viral.  No shock there either.  But the potential for “viral” is more powerful now than it ever was before.  Stories of good customer service or great products (or rotten customer service and awful produts) make the rounds in no time now through blogs, websites, social networks (and occasionally even traditional news outlets) in no time.  Almost No Subject is Off Limits.  For goodness sakes, in this case, there was a serious subject driven home via an inflatable colon.  And the word began to spread.  So is thinking about PR impact worthwhile?  Absolutely.  As it’s sung in Gypsy, “You Gotta Have a Gimmick.”  The folks at Prevent Cancer Foundation and Sanofi-Aventis have done a GREAT job with it.  My hat is off to them.

One final note and it relates to the topic at hand: spreading the word!  If you like what you’ve read in this and other posts so far on Well Worth It, I hope you’ll consider subscribing.  You can do it via RSS along the right side of this page, or you can click in the Want to Be Notified of a New Post section on the right.  If you provide me your e-mail address, I’ll be happy to shoot you an e-mail every time I’ve posted a new entry.  Don’t worry: I won’t spam you with other stuff, and I won’t share your e-mail address.  Nor will I make you walk through a 20-foot inflatable colon!

180 Oysters? Or 26.2 Miles?

There’s a show on The Travel Channel called Man V. Food.  On the show, the very entertaining host, Adam Richman, goes to cities around the country and drops in on some of their famous restaurants.  But the last part of each episode is where the real man v. food concept comes into play.  Adam visits a restaurant that has a particular “eat this or that insane amount of food (or insanely hot food, etc.) in X amount of time” challenge, and get a free t-shirt, get a picture on the wall, etc.  I love the show, and I can’t particularly figure out why.  I like some of the foods he eats; some I find disgusting.  But either way, it is entertaining television.  In the most recent episode I’ve watched, Adam visited Acme Oyster House in New Orleans and downed 15 dozen oysters to successfully complete the challenge.  I’ll often watch the show with my wife, Shara.  I think she’s mildly entertained, but at least once an episode she can be heard muttering, “What is the point?”

It’s a fair question.  After all, no one needs 180 oysters to survive.  No one needs a 7 1/2 lb. burger.  In fact, no one really needs any of the behemoths that Adam has ingested in his various shows.  But if I put myself in his shoes, I would absolutely have a sense of accomplishment any time I’d win one of his challenges.  I don’t have to reach far in my own life to find things that, by any rational measure, don’t make sense but give a great sense of accomplishment.  Shara and I are both runners.  At various points, we’ve both trained for and run half-marathons and full-length marathons.   I know that running (and exercise, in general) is good for me.  I’m reasonably convinced, though, that running a marathon is not all that good for me.  It is worth remembering that the original “marathon” in Greece was run by necessity.  While the story varies somewhat, the gist of it is that Phidippides ran 26 miles from Marathon to Athens to announce that the Athenians had defeated the Persians.  It is also worth noting that the most common version of the story has Phidippides announce “Victory”…then drop dead.  Clearly he forgot to wear his specialty running shoes, his wick-away shirt, and also forgot to drink Gatorade along the way.  And what lesson do we take from all of this?  We decide, “It killed Phidippides.  We should try it.”  It would be a great accomplishment to finish it (and not drop dead).

So clearly we, as humans, put an enormous value (and sense of self-worth) on accomplishments we can call our own.  Some of our accomplishments are good for our bodies.  Perhaps a personal record in a 5-K that makes all your training worthwhile.  Some of our accomplishments are good for our minds.  Admit it, you’re always pleased to thrash someone in Trivial Pursuit.  Some of our accomplishments are good for our professional standing.  Walk into any corporate environment and you’ll see various trophies, certificates, mini-statues, or engraved TPS Reports proudly displayed on people’s cubicles.  Those are our “productive” accomplishments.  But sometimes it’s worthwhile to celebrate the accomplishments just because we’ve completed something…period.  It may be unusual.  It may be unhealthy.  It may or may not even be fun.  It may be something as ridiculous as eating 12 fiery-hot buffalo wings in 10 minutes or eating the giant CARNIVORE pizza without hurling.  But if it required effort, if it involved dedication, if it involved setting a goal and taking it all the way to completion, then you’ve probably done something that is worthy of a salute.  After all, there are so many times in life where we do try, and in spite of our best efforts, still fail.  We fall short.  We can’t reach the end.  So for those times when we do achieve what we sent out to do, even on a relatively pointless challenge, we celebrate.  And for that, I say congratulations!