By Carl Delfeld of ETF Passport
Although I have lived in Colorado for more than a decade now, I still wear Johnston & Murphy loafers rather than Justin boots.
Even so, my admiration for what the American cowboy represents has markedly grown. From a personal as well as an investment perspective, cowboys represent both geographic and inner mobility and the willingness to get on the bull and take risks. To persevere and overcome hardship and challenges is the story of the cowboy and as the wonderful ongoing History channel series puts it: the story of us.
There are good reasons why the cowboy is the symbol of America at home and around the world.
The American cowboy is everything good that our country is and should be. First and foremost, the cowboy is self reliant and independent but generous in helping others in distress. He likes to keep things simple and straightforward. Resilient and persistent, the cowboy accepts and welcomes that great accomplishment and wealth only come with commensurate risk. He has a keen sense of honor and stewardship and appreciates that activity and flexibility are the keys to success in gaining a livelihood.
In judging a rope hand, issues of gender and race are ridiculous and “betting the ranch” is done with their own money. While there is nothing wrong with borrowing money to finance a herd, it is hard to ride tall in the saddle when you owe everybody in town as Ronald Reagan used to say.
I believe the above characteristics are not just vital to success on the range but in our personal lives and in our nation’s economic and political matters.
Now cowboy capitalism, like its sibling cowboy diplomacy, has taken a beating lately and not just in the salons of Europe. Unfortunately, the cowboy image many carry in their heads is upside down: the cowboy as reckless, carefree and irresponsible.
It seems to me that our country is unfortunately riding away from true cowboy values and many Americans feel this in their bones. But don’t despair. De Tocqueville recognized that “the greatness of America lies not in being more enlightened than any other nation, but rather in her ability to repair her faults.”
In my new book Red White & Bold: The New American Century,
I suggest eight key relationships that need to be rebalanced if this is to be another American century.
Risk taking and wealth
Simplicity and complexity
Rights and responsibilities
Diversity and unity
Dependence and self-reliance
Saving/equity and spending/debt
Management and shareholders/boards of directors
Industry and finance
Let’s briefly look at the first two relationships with cowboy capitalism in mind.
The basis of capitalism is weighing potential rewards against risks, making a decision, and then putting capital to work. Taking risks should not be confused with careless speculation or gambling, but rather entails careful calculation and a prudent weighing of the probabilities of success against the sobering possibility of a setback and the proverbial “back to the drawing board.”
It is vital to keep in mind that, as the great Walter Wriston colorfully put it, risk is not a four- letter word. On the contrary, without taking risks, nothing of lasting value can be accomplished. All of America’s scientific and commercial achievements were due to individuals taking risks, sometimes despite what appeared to be daunting odds. And economic growth comes only when capital is allowed to flow to its most productive uses—and that means to people and companies taking on these risks.
A culture of risk taking and innovation is at the heart of American capitalism and the process of creating wealth. America’s vigor is also closely tied to a culture of second chances. At the rodeo of life, the only unforgiveable sin is failing to try in the first place. As the sage Ben Stein points out in “How Successful People Win”, you can’t sit in the bunkhouse and get the cattle to market and when thrown by a bronco, you dust yourself off and get back in the game.
But while the cowboy and the trail boss understand that a nice bonus awaits them if they get the cattle to market on time, they never think like some bankers, executives and traders that the cattle they look after actually belongs to them. Cowboys have a sense of keen sense of stewardship, responsibility and honor that businessmen should follow.
Watch any cowboy at the poker table and you will find they hold their cards close to their vest and are good bluffers. Above all, cowboys have common sense and are alert to opportunities. Finding ways to grow with emerging markets would be a lead-pipe cinch.
Cowboys also understand that while on a cattle drive a lot can go wrong and usually does, looking to Washington DC to get them out of a fix is hopeless and insulting. They are also an independent lot and depending on the Mideast for energy or the Chinese for debt financing is like a cold cup of black coffee on a bleak winter morning. Cutting spending, offshore drilling, nuclear power and clean coal are all better than going on bended knee.
Finally, any cowboy would grimace at the complexity of government red tape, many of our financial products and an impossibly complex tax code that confronts every budding entrepreneur as well as the 27 million small businesses in America that generate most of our economic growth and employment.
As a rule, cowboys are not keen on paperwork.
In the wake of the global financial crisis, it is par for the course to argue that the cause of our problems was deregulation and that we need to increase regulations on commerce and finance. This prescription would be a disaster for American competitiveness. Certainly, some regulations need to be modernized but the simpler the better. According to the Heritage Foundation, money spent by federal regulatory agencies increased 44 percent under the recent Bush administration. In 1950, The Federal Register contained 20,000 pages and by 2000 it had grown to 120,000 pages.
Try getting that into your saddlebag.
Carl Delfeld is managing director of Chartwell Partners, chairman of the Center for Economic Diplomacy and author of Red White & Bold: The New American Century.
Although I have lived in Colorado for more than a decade now, I still wear Johnston & Murphy loafers rather than Justin boots.
Even so, my admiration for what the American cowboy represents has markedly grown. From a personal as well as an investment perspective, cowboys represent both geographic and inner mobility and the willingness to get on the bull and take risks. To persevere and overcome hardship and challenges is the story of the cowboy and as the wonderful ongoing History channel series puts it: the story of us.
There are good reasons why the cowboy is the symbol of America at home and around the world.
The American cowboy is everything good that our country is and should be. First and foremost, the cowboy is self reliant and independent but generous in helping others in distress. He likes to keep things simple and straightforward. Resilient and persistent, the cowboy accepts and welcomes that great accomplishment and wealth only come with commensurate risk. He has a keen sense of honor and stewardship and appreciates that activity and flexibility are the keys to success in gaining a livelihood.
In judging a rope hand, issues of gender and race are ridiculous and “betting the ranch” is done with their own money. While there is nothing wrong with borrowing money to finance a herd, it is hard to ride tall in the saddle when you owe everybody in town as Ronald Reagan used to say.
I believe the above characteristics are not just vital to success on the range but in our personal lives and in our nation’s economic and political matters.
Now cowboy capitalism, like its sibling cowboy diplomacy, has taken a beating lately and not just in the salons of Europe. Unfortunately, the cowboy image many carry in their heads is upside down: the cowboy as reckless, carefree and irresponsible.
It seems to me that our country is unfortunately riding away from true cowboy values and many Americans feel this in their bones. But don’t despair. De Tocqueville recognized that “the greatness of America lies not in being more enlightened than any other nation, but rather in her ability to repair her faults.”
In my new book Red White & Bold: The New American Century,
I suggest eight key relationships that need to be rebalanced if this is to be another American century.
Risk taking and wealth
Simplicity and complexity
Rights and responsibilities
Diversity and unity
Dependence and self-reliance
Saving/equity and spending/debt
Management and shareholders/boards of directors
Industry and finance
Let’s briefly look at the first two relationships with cowboy capitalism in mind.
The basis of capitalism is weighing potential rewards against risks, making a decision, and then putting capital to work. Taking risks should not be confused with careless speculation or gambling, but rather entails careful calculation and a prudent weighing of the probabilities of success against the sobering possibility of a setback and the proverbial “back to the drawing board.”
It is vital to keep in mind that, as the great Walter Wriston colorfully put it, risk is not a four- letter word. On the contrary, without taking risks, nothing of lasting value can be accomplished. All of America’s scientific and commercial achievements were due to individuals taking risks, sometimes despite what appeared to be daunting odds. And economic growth comes only when capital is allowed to flow to its most productive uses—and that means to people and companies taking on these risks.
A culture of risk taking and innovation is at the heart of American capitalism and the process of creating wealth. America’s vigor is also closely tied to a culture of second chances. At the rodeo of life, the only unforgiveable sin is failing to try in the first place. As the sage Ben Stein points out in “How Successful People Win”, you can’t sit in the bunkhouse and get the cattle to market and when thrown by a bronco, you dust yourself off and get back in the game.
But while the cowboy and the trail boss understand that a nice bonus awaits them if they get the cattle to market on time, they never think like some bankers, executives and traders that the cattle they look after actually belongs to them. Cowboys have a sense of keen sense of stewardship, responsibility and honor that businessmen should follow.
Watch any cowboy at the poker table and you will find they hold their cards close to their vest and are good bluffers. Above all, cowboys have common sense and are alert to opportunities. Finding ways to grow with emerging markets would be a lead-pipe cinch.
Cowboys also understand that while on a cattle drive a lot can go wrong and usually does, looking to Washington DC to get them out of a fix is hopeless and insulting. They are also an independent lot and depending on the Mideast for energy or the Chinese for debt financing is like a cold cup of black coffee on a bleak winter morning. Cutting spending, offshore drilling, nuclear power and clean coal are all better than going on bended knee.
Finally, any cowboy would grimace at the complexity of government red tape, many of our financial products and an impossibly complex tax code that confronts every budding entrepreneur as well as the 27 million small businesses in America that generate most of our economic growth and employment.
As a rule, cowboys are not keen on paperwork.
In the wake of the global financial crisis, it is par for the course to argue that the cause of our problems was deregulation and that we need to increase regulations on commerce and finance. This prescription would be a disaster for American competitiveness. Certainly, some regulations need to be modernized but the simpler the better. According to the Heritage Foundation, money spent by federal regulatory agencies increased 44 percent under the recent Bush administration. In 1950, The Federal Register contained 20,000 pages and by 2000 it had grown to 120,000 pages.
Try getting that into your saddlebag.
Carl Delfeld is managing director of Chartwell Partners, chairman of the Center for Economic Diplomacy and author of Red White & Bold: The New American Century.
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