La Vida Loca

Originally published in Flourishing Jan/Feb 2013

“You’re too smart to be from Mexico.”  Alfredo’s new friends and classmates were stunned into silence by that comment, made by a post-graduate teaching assistant (TA) at the University of California (U.C.) at Berkeley.  For his part, though, Alfredo mentally filed it among the many reasons he had for earning a college degree.  He was still using a Spanish-English Dictionary to interpret his professors’ lectures; and he still carried a heavy load of self-doubt. This wasn’t a hill to die on.

It had only been a few months since Alfredo Quiñones had earned an Associate’s Degree at San Joaquin Delta College (SJDC); and it was on the basis of his academic record there that he had been admitted at Berkeley.  In fact, he had innocently thought that when he finished at SJDC, his college education would be complete.  Fortunately, in his final semester, one of his SJDC professors discovered Alfredo’s confusion and referred him to a faculty advisor, who was able to explain his educational options.  In the process of advancing his education just that far, Alfredo had pulled weeds and picked tomatoes and cotton on San Joachin Valley produce farms; he had shoveled sulphur from rail cars; and he had learned to weld heavy steel in Stockton, California’s railroad yards.  Now at U.C. Berkeley, he was still burning the candle at both ends.

Alfredo’s big dream was to become an American citizen.  He had already helped bring his parents, Sostenes and Flavia, and his four siblings to the San Joachin Valley from their two-room home in Polaco, Baja, Mexico.  They were all on the road to American citizenship.  That journey had started the day that Alfredo hopped the eighteen foot fence topped with barbed wire that separated Mexicali, Mexico from Calexico, California. 

It had taken two attempts.  The first time over the top, Alfredo was greeted by American border guards. “Ay, Dios mío!” he thought to himself, not knowing what fate awaited him.  But the guards somehow understood that he wasn’t a threat to American national security, and they delivered him through the nearest checkpoint back into Mexico. 

After being released, Alfredo returned immediately to the same spot in the wall and scaled the rampart again.  This time, he vanished into the dark streets of Calexico, and by dawn he was in the San Joachin Valley at the home of his uncle.  That day had been his eighteenth birthday—the happiest day of his life he thought—January 2, 1986. 

Fortunately, Alfred0’s illegal crossing was soon forgiven when President Reagan signed the Simpson-Mazolli Immigration Act of 1986.  That’s when he felt it was safe to enroll at SJDC.

By the time he received his Bachelor’s Degree in Psychology from U.C. Berkeley, Alfredo no longer needed his Spanish-English dictionary.  And, he had decided to become a doctor.  Indeed, with his dazzling academic record, he was faced with choosing among medical schools at Stanford, Cornell, and Harvard.  He chose Harvard, where he again made a name for himself, this time with the nation’s most respected medical faculty. 

In 1999, at the age of thirty-one and with his medical education at Harvard nearly complete, Alfredo showed his academic credentials and letters of recommendation to the lady at the citizenship office in Boston.  Examining them carefully, she asked, “How did you go from being a migrant farm worker to all this?”  Alfredo Quiñones didn’t have an answer, and unsure of where the question would lead, he was trembling.  “Ay, Dios mío! Not again.” he thought to himself.  Then the lady smiled, stamped his papers, and offered her congratulations: “Alfredo, you are now a citizen of the United States of America.”  

He had often reminded himself of the words of his grandfather, Tata Juan Quiñones: “Alfredo, whenever you have the choice, don’t follow where the path leads.  Go instead where there is no path and then leave a trail.” La vida loca!  Live the crazy life, yes; but always with a worthy purpose in mind.  Alfredo knew he had done that, exactly.  He no longer had to explain—to himself, or to anyone else—that he was worthy of the risks he’d taken and the opportunities he’d been given.  He was chosen by his graduating class at Harvard to deliver their upcoming commencement address.  “That triumph”, he now says, “was also an exorcism. …with my photo on the front page, I was truly living la vida loca.”  And with that speech, his self-doubt was gone. 

Dr. Alfredo Quiñones-Hinojosa (he added his mother’s maiden name to his own) is now teaching and practicing medicine at Johns-HopkinsUniversity and Hospital in Baltimore, where he is one of America’s leading brain surgeons.  Dr. Q. has also created a brain research laboratory at Johns-Hopkins, dedicated to discovering the causes of brain cancer and for developing more effective treatments.  He is fully supported in his efforts by his wife, the former Anna Peterson of Mendota, California, and their three children. mh


* This article is based on the book, Becoming Dr. Q: My Journey from Migrant Farm Worker to Brain Surgeon, by Alfredo Quiñones-Hinojosa, M.D.,  University of California Press, 2011.  You should read it.  Really!


Hercules vs. the Hydra

Originally published in Flourishing November/December 2012

In the June 2012 issue of this newsletter, I asked you to think about the reasons for America’s high unemployment rate.  Then in the next two issues, I wrote that government interference in the form of minimum wage laws have helped raise the unemployment rate among black inner city youth to nearly 40%; and that laws favoring union bosses over non-union workers have in many states forced wages to uneconomic levels. 

The important thing to keep in mind is that for most businesses, wages are their most significant cost.  So, when the price of labor is forced to uneconomic levels by government interference, unemployment and business failures are certain to be the result.  The principle also applies to government mandated, one-size-fits-all, health insurance benefits. All labor costs—however necessary or desirable they may seem—consume capital that might otherwise be deployed in new business investment and in creating new jobs. 

Now, as an exemplar of government overreach in other areas, let’s consider the national 55 miles-per-hour speed limit.  Passed by Congress in 1974 with the intention of reducing fuel consumption, that law—when it was obeyed—increased labor costs for the obvious reason that it required at least twenty percent more time for shippers to deliver the goods.  Because it was virtually unenforceable and widely ignored, the 55 miles-per-hour speed limit was ultimately repealed in 1995.  That alone tells you just how economically silly the law was. 

Then consider that from January 1, 2009 through December 31, 2011, the Code of Federal Regulations has increased by 11,327 pages.  According to the Office of Management and Budget, that brings the total register of federal regulations to 169,301 pages.  That’s a stack of paper 32 feet high.  I’m not sure I can throw a football that high.  Common sense tells me that every one of those pages adds to the cost of doing business.  And, what are the odds that in 169,301 pages of regulations there will be contradictory and ambiguous rules? The probability must be pushing 100%.  If I’m right, a regulatory violation is virtually guaranteed for every business in America.  That makes me suspect that the real purpose of our government is not to catch criminals, but to create them. I have to ask, “How many productive jobs could be created with the dollars it takes to pay and entertain the little Caesars who dream up 11,327 pages of regulations in just three years?”

Taxes come at businesses from virtually every legislative body, and for an unending variety of “needs”.  These costs—with the exception of most sales taxes—are not generally passed along to consumers, as is frequently claimed. It’s a myth; like labor costs, they’re usually paid out of capital.  Virtually every dollar taken out of the private economy by taxes is consumed; either by the government directly—where waste, fraud, and abuse are notoriously rampant—or by those who are the beneficiaries of government largess.  These are all dollars that won’t be voluntarily invested in the expansion of existing businesses, the launching of new enterprises, or the creation of new jobs.  Higher business taxes mean fewer jobs. 

Contrary to another myth, most entrepreneurs and business managers aren’t keen to take unnecessary risks.  In recent years, though, they’ve faced bellicose, irresponsible, and undeserved taunts and vague economic threats; all for the purpose of media attention and/or political expediency.  When the most productive people in America are collectively demonized by politicians and pundits for allegedly being selfish, predatory, unpatriotic, and unnecessary—as if every successful business in America is run by Bernie Madoff or Vito Corleone—is it any great surprise that many companies, especially relatively small businesses with 50 to 500 employees and limited legal budgets, are reluctant to expand and hire new workers?  I think not.

Finally, if this discussion wore you out or made you angry—as it just did me—I’m sorry.  But, just imagine how a business executive or small business owner must feel.  Concerned for the welfare of her employees and their families, responsible to her bankers and her investors, trying desperately to provide quality products and services to her customers—all the while dealing with government’s taxes, rules, mandates, and threats—she  must feel as Hercules felt in his battle with the Hydra.  She is my hero. mh

Fred and Pete Go To Market

Originally published in Flourishing March 2012

I received an unsolicited email recently from the self-described marketing genius, Dan Kennedy.  Dan is a serial entrepreneur and a self-made multimillionaire.  Dan doesn’t have a college degree; in fact, he never attended college.  He inherited nothing from his family, but a strong work ethic.  However, this isn’t about Dan; or not just about Dan.

In his email, Dan tells the story of a seventeen year old kid named Fred, who was scouting for a way to make some money beyond his minimum wage job.  It was 1965, and the minimum wage was about $.75 an hour.  Fred went to see a family friend for advice.  The friend’s name was Pete.

Pete suggested that Fred open a little sandwich shop, and offer food that was less fattening and more healthy than the sandwiches at McDonald’s and other fast food stores.  Pete and Fred formed a partnership, with Pete investing $1,000 and Fred investing his time.  The first store opened in Bridgeport, Connecticut to very limited success.

Fred and Pete were sure they had a good product, so they attributed their limited success to the store’s location, and they opened a second store.  But, the second store also produced mediocre results.  At that point, most people would have given up, but not Fred and Pete.

Fred enjoyed the business so much—and was so confident in his product—that he convinced Pete that they should try a third location, one with more visibility.  And, they agreed that they should spend more money on marketing and advertising.

As you may have guessed, Dan is trying to sell me some marketing ideas, but that’s not really the point of his story.  I’ll get to that in a minute.

First, you need to know that the Fred in this little story is Fred de Luca, and Pete is Dr. Peter Buck.  

The name that they gave their little sandwich shop back in 1965—Subway.

In case you haven’t been counting, there are now more Subway stores (33,749 as of May 2011) than there are McDonald’s. Fred and Pete went to market and became billionaires.  Both are now on the Forbes 400 list of wealthiest Americans.

So here, according to Dan, are the business lessons this story teaches:

Don’t be afraid to collaborate.

Look for ways to do the opposite of what almost everyone else is doing.

Focus relentlessly on your goal.

Don’t let your own lack of money stop you.

There is, I think, one more lesson; and that is that America still offers boundless opportunity to everyone with a well-defined purpose to fulfill.   mh

What Do They Have in Common?

Originally published in Flourishing March 2012.   


Sheldon Adelson

Carl Berg

Stephan Bisciotti

Leon Charney

John Paul DeJoria

Larry Ellison

Alan Gerry

Alec Gores

Harold Hamm

 George Joseph

 Kirk Kerkorian

 Ken Langone

 Ralph Loren

 Carl Lindner, Jr.

 David Murdoch

 Thomas Peterffy

 Howard Schultz

 Kenny Troutt

 Albert Ueltschi

 Oprah Winfrey

They range in age from fifty to ninety-three.  Most, but not all, were born in America.  They are all alive today, and still actively engaged in things that they love to do. 

Some didn’t finish high school. Others dropped out of college.  Only a couple of them have MBA’s.  I’ve listed only twenty, but there are many more.

What do they have in common?

Yes, they are all in the One Percent; but, that’s not the right answer.   The right answer is that every one of these people started from absolutely nothing and made themselves into billionaires.  mh


The Essential Heroes: the One Percent

 Originally published in Flourishing March 2012

Thirty-odd years ago, I was working for W. J. Powell Construction Company in Beloit,Kansas.  “Dub” was a wonderful person and a fair employer.  The job wasn’t all that challenging, though, so I would take a book to work, and often used my lunch break to read biographies.  That’s when it started—that little fire in the belly that says, “You can do more.”

 One of the books that I read during that period was Study in Power: John D. Rockefeller, Industrialist, Philanthropist, by Allan Nevins. 

 Born in 1839, John D. Rockefeller rose from the lowest rungs of society to become one of the world’s wealthiest men and greatest philanthropists.  His father was a ne’er-do-well elixir salesman and bigamist, who frequently abandoned his family for months and years at a time.  Notwithstanding, John D. was serious, studious, hard-working, frugal, and well-behaved; and before he was forty, he was a member of the One Percent.

 I mention John D. here, because I want to introduce you to a more recent member of the One Percent—a man from similarly humble beginnings.  The two men have more in common than great wealth.

 Born in rural Oklahoma in 1945, Harold Hamm was the youngest of thirteen children.  His father was a share-cropper, who raised his family in a one room shack, devoid of indoor plumbing.  Harold left home before graduating from high school, and took a job as a pump-jockey (a term of endearment, if you please) at an Enid, Oklahoma gas station.   

Fast forward fifty years: Last November, Harold Hamm was inducted into the Oklahoma Hall of Fame, along with Tommy Franks of Wynnewood; Marques Haynes of Sand Springs; Cathy Keating and Steve Malcolm of Tulsa; Elizabeth Warren of Oklahoma City; and (posthumously) Roger Miller of  Erick.  He still likes burgers from Sonic Drive-In, but Harold is now #36 on the Forbes 400 list of wealthiest Americans.  His net worth is $9.0 billion, give or take; virtually all of which is still invested in finding and producing oil and natural gas.

Ever grateful for his success, Harold’s many generous gifts include a recent $30 million donation for the Harold Hamm Diabetes Center on the University of Oklahoma campus.  “If it hadn’t been for education, I would have never had a chance to break away from the poverty cycle my family and I were caught up in ever since the Depression years.”  (After his initial success, Harold went back to school; and he has never stopped learning.)

Of his induction into the Oklahoma Hall of Fame, Harold said, “It’s a great honor, and it’s not anything I ever thought I would receive … it’s really beyond my dreams. …For this honor to come about right now while I still have some siblings alive, and for them to share this with me, means everything.”

That says a lot about the kind of man Harold Hamm is.  He started in business with a $1,000 loan, co-signed by a friend.  In 1967, at the age of twenty-two, he incorporated his business—a one-man, one-truck oilfield services company—as Shelly Dean Oil Co., named for his two oldest daughters.  His wife kept the books, and as the little company grew, Harold and Sue Ann’s daughters answered the phone.

“Back then it was one day at a time, it was one minute at a time, almost. It was a very meager beginning and we’ve been very fortunate.”

Harold’s little company has done well over the last forty-five years.  At the end of 2010, Continental Resources (formerly Shelly Dean Oil Co.), which is still based in Enid and Oklahoma City, had proved reserves of 364.7 MMboe (million barrels of oil equivalent).    Continental now operates in twenty states and is far and away the largest leaseholder (855,936 acres) and producer (6.9 MMboe in 2010) in the Bakken Shale region of North Dakota and Montana. 

Bakken, which accounted for 44% of Continental’s 14.7 MMboe production in 2010, had been written off by almost every industry expert just a few years ago as not worth exploring and developing—almost every expert, but not Harold Hamm.  According to the company’s 2011 Annual Report, Continental is “on track to triple production and proved reserves from 2009 to 2014”.  Like most businessmen in the One Percent, Mr. Hamm, who still owns 68% of Continental’s shares, consumes an infinitely small fraction of his income, preferring instead to reinvest in his community and in the work he loves to do.

One line that I remember most vividly from my ancient reading of Study in Power was a comment by one of John D. Rockefeller’s associates:  “He sees far ahead of everyone else; and then, he sees around the corner.”  What that man meant was that Rockefeller knew more than anyone else about his industry—because he studied more and worked harder.  Rockefeller nearly always sought the counsel of his associates, but he was willing to accept full responsibility for his business decisions by repeatedly staking his own life and fortune on them. Ditto, Harold Hamm.  That’s why they are the essential heroes—the One Percentmh