Showing posts with label Commentary. Show all posts
Showing posts with label Commentary. Show all posts
Wednesday, November 11, 2009
Singapore and Democracy
This interview is somewhat enlightening. MM Lee talks about why he made the choices he made in the past, and other commentators in the west talks about his achievements.
MM Lee's Interview with Charlie Rose 2009
Part 1
Part 2
Part 3
Part 4
Part 5
Part 6
I always like to listen to MM Lee speak. I do not always agree with his view, but I appreciate his incisive train of thought and his views.
Part 2
Part 3
Part 4
Part 5
Part 6
I always like to listen to MM Lee speak. I do not always agree with his view, but I appreciate his incisive train of thought and his views.
Wednesday, March 04, 2009
Willie Smits: How we re-grew a rainforest
This is an inspiring video. By piecing together a complex ecological puzzle, biologist Willie Smits has found a way to re-grow clearcut rainforest in Borneo, saving local orangutans -- and creating a thrilling blueprint for restoring fragile ecosystems.
Monday, March 02, 2009
Wednesday, February 25, 2009
Lee Kuan Yew On Charlie Rose
MM Lee Kuan Yew's interview on Charlie Rose 2 years ago... I think this is a good interview, and agree with most (but not all) of MM Lee's views, especially his views on religious fundamentalism at the very beginning of the interview.
Friday, January 30, 2009
Instruction Manual For Life
Another excellent video from Qualia Soup, this time in collaboration with Theramin Trees...
Do you have an instruction manual for life and did you really read it?
Monday, December 15, 2008
Howard Zinn's Philosophy
I have recently been reading a lot of his works, and listening to a lot of his lectures. I am highly impressed by him and agree with a lot of what he says. This is a short clip that I found on YouTube, which summarizes his philosophy towards government and society.
Friday, December 12, 2008
Chomsky and Trivers
This is something from the Seed Magazine (here) that I thought was very interesting. It is a conversation between Robert Trivers (the person who proposed the kin selection theory) and Noam Chomsky (renown linguist and fierce critic of US foreign policy) on deception at the individual and international level.
Monday, December 08, 2008
An Interview With Lee Kuan Yew 2008
This is an interview I found online (here) that MM Lee gave earlier this year to a foreign newspaper. Surprisingly, I don't think I read any of the local papers picking up the content of this interview (I could have missed it), which is a shame, because I think the things that MM Lee said in this interview made a lot of sense.
==================================
by Arnaud De Borchgrave
Singapore (UPI) Feb 8, 2008
UPI Editor at Large Arnaud de Borchgrave interviewed Singapore's Minister Mentor Lee Kuan Yew on Feb. 2. The following is the text of the interview.
UPI: How do you see Iraq?
Lee: I do not want to say anything that would hurt President Bush because I believe he went in with the best of intentions. He put his trust in Dick Cheney. And I had trust in Dick Cheney as the voice of experience -- oil business executive, defense secretary during the first Gulf War (1990-91). But I don't know what happened to Dick Cheney. He allowed himself to believe with Richard Perle and the neocons you could change Iraq. How could you change Iraq, a 4,000-year-old society that is not malleable? Everybody knows the troubles the British had during and after World War I. Ideology should have no place when making geopolitical assessments.
George W. Bush, whatever his faults, is not walking away from what was started, which is just as well otherwise further damage will be done.
Q: And the next president?
A: Of all the candidates who will inherit the problem, I prefer John McCain. He will see this thing through. Walking away from it would also have disastrous consequences. If Afghanistan is a failed state, it's not your fault. No one has ever made sense out of it. But if you leave Iraq in its present state, you will have even bigger problems throughout the entire Middle East. The Shiites will get together. The Iraqi Shia will become dependent on Iran, and the Iranians will have mastery of that critically important Gulf area.
Q: So what is your recommendation about Iran's nuclear ambitions?
A: Is it now unstoppable. They are a very old civilization. Unlike the Arabs, apart from Mesopotamia valley, they rank with the Chinese, as history's two principal civilizations worth talking about. And I think the mullahs and others want to go back to the days of empire.
Q: So should we be talking to them at the highest level, the way Henry Kissinger went to China?
A: (Chuckle) But you haven't got a Kissinger or a Brzezinski to do that anymore. Where is the successor generation of geopoliticians?
Q: In fact, democracies don't produce great statesmen anymore. Why?
A: You now have, and I don't know how long this phase will last, mass media domination, owned by a group of media barons who want constant change for their balance sheets.
Q: So the power of mass media has made it impossible for a great statesman or woman to emerge and last any length of time?
A: I'm not sure. It depends on the nature of the crisis that must be faced. When a real crisis sets in, a matter of life and death, opinion formulators realize this is no time to be pontificating, but a time to stay the course with someone who understands what this is all about. Short of that, the media help put a leader on the pedestal and then start chopping away at the pedestal until he/she falls in disgrace. That's part of the cycle of constant change. Watch Sarkozy in France. They hoisted him up to prominence and now they're already attempting to bring him down through his personal life.
Q: But didn't Sarkozy contribute to what you call the cycle?
A: Well, yes. But it's also the enormous pressure of media competition and the giant appetite for advertising revenue, what television program gets what viewership, or eyeballs, or clicks online. Never mind the consequences. If you get the advertising, you win.
Q: We have a whole new generation that doesn't read newspapers, but get their news online. The average age of a newspaper reader in the United States today is 55.
A: So I'm a dinosaur (laughs).
Q: When I last interviewed you in May 2001, I asked you what concerned you most about the next 10 years, and you replied, "an Islamist bomb, and mark my words, it will travel." Four months later, we had Sept. 11. Secondly you said, "China and India's challenge to the global status quo." Do you still have the same concerns about the next 10 years?
A: Not quite. The Islamic bomb has traveled already (in Iran). I'm not sure how this will now play out. The U.S., the Europeans, even the Russians, will have to make up their minds whether to allow Iran to go nuclear. The Russians are playing a game, posing as the nice guys with Iran, supplying nuclear fuel, and making it look as if America is causing all this trouble. But if I were Russia today, I would be very worried about Iran acquiring the bomb, because Russia is more at risk than America. The risk Israel runs is another dimension. Russia is at risk because whether it's the Chechens or Central Asian Muslim states that were former Soviet republics, none are friendly to Moscow. Next time there's an explosion in Moscow, it may be a suicide bomber who isn't wearing an explosive belt or jacket, but something a lot bigger. It would certainly be in Russia's interest to say at some future point to Iran, "this far and no further." It could also be that Russia no longer knows how to stop it, in which case the Russians will be opening the door to a very dangerous world of nuclear proliferation. You can be quite sure that if and when Iran gets the bomb, the Middle East will go nuclear.
Q: Which raises the question of the United States or Israel bombing Iran's nuclear facilities.
A: (long silent pause) ¿¿ I can express no views on that.
Q: The Israelis say they are facing an existential crisis.
A: No question, they are at risk.
Q: As I travel in moderate Muslim states in North Africa, the Middle East and South Asia, I ask heads of state and government how many extremists, or would-be jihadis, they estimate live in their midst, also how many fundamentalists who support openly or secretly the jihadi cause. The answer is usually 1 percent and 10 percent. In a country like Pakistan, that translates to 1.6 million extremists and 16 million supporters. On a global scale, that comes out to roughly 14 million extremists and 140 million sympathizers.
A: Yes, but I do not see them winning, and by that I mean able to impose their extremist system. I can see them inducing fear and insecurity, and causing fear, but they don't have the technology and the organization to overwhelm any government.
Q: So how do you assess the global threat since Sept. 11? What are we doing that's right and also that's wrong?
A: Even if we can't win, we mustn't lose or tire. We cannot allow them to believe they have a winning strategy, and that more suicide bombers and WMD will advance their cause and give them a chance to take over.
Q: So we're doing the right thing?
A: No. Iraq was a mistake. I've said this before and I said this in the presence of Paul Wolfowitz, one of the architects of the invasion, at an IISS conference two months after the fall of Saddam Hussein, when someone asked me what will happen in Iraq. In October 2002, I was in Washington and became quite convinced an invasion would take place. On the way home, I stopped in London and asked Tony Blair to brief me. After 45 minutes, I said, "Look I accept the argument that with British and American military capabilities it would be a walk over, but then what do you do the day after? Blair replied, "That's up to the Americans." I then said to Blair, "If you were in charge, what would you do?" His political adviser then stepped in and said, "We would appoint the strongest pro-Western general and then get out quickly." So I repeated all that at the IISS conference and explained this reflected the institutional memory of what the British had been through in Iraq in the early 1920s. Paul Wolfowitz stood up in high dudgeon. So to placate him, I said, "Of course the British don't have the resources you have."
Q: Did Wolfowitz ask anything of you?
A: Yes, he came to my office to ask that Singapore send police trainers to Iraq. I had known Paul since his days as an ambassador at the State Department. I said, "Paul, do you realize how long it takes to train a policeman in Singapore? And that's only in one language, English, and it still takes two years. And you want me to teach Iraqis how to do it in three months in English? No, he replied, we'll supply translators. This is an emergency, he said, and many nations are helping us. So I replied OK, but we'll do it in Amman, Jordan, not Baghdad, where we would become the targets of suicide bombers. When he told me they had disbanded Saddam's police force, I became very nervous. Because when the Japanese came down here in World War II, 20,000 of their troops captured 90,000 British, Indian and Australian troops. They sent them into captivity, but they left the local police in charge, and kept all the other positions of the British administration intact -- from power management to the gas board -- and simply put Japanese in charge of each British position. And 20,000 Japanese troops moved on to Java. But in Iraq, you disbanded everything, and tried to run things without the former Baath party officials who had been in charge of civil administration. You created an ungovernable vacuum.
Q: Why do you think this was so?
A: From Day One, the idea of remaking Iraq, without the civil service in place and without recalling Saddam's army to service, showed a frightening lack of understanding of local conditions and elementary facts of political and economic life in Iraq. In ancient days, those who invaded and conquered China on horseback got off their horses and applied themselves to the more difficult job of governing.
Q: Did Iraq have anything to do with al-Qaida?
A: Of course not, as became clear in the daily sessions the imprisoned Saddam spent with his Arabic-speaking FBI interrogator over several months before his execution. But U.S. authorities were convinced Saddam was secretly supporting al-Qaida with weapons and training and maybe even WMD. So therefore the imperative became the elimination of Saddam.
Q: Switching to Pakistan, most terrorist trails in the United Kingdom and most recently in Germany via Turkey, track back to training camps and madrassas in the tribal areas that straddle the Pakistan-Afghanistan border.
A: We even had a terrorist of Pakistani descent here in Singapore.
Q: So what's your view of what should be done about the Pakistan-terrorist nexus?
A: (Laughs for several seconds) We should learn to live with it for a long time. My fear is Pakistan may well get worse. What is the choice? (President) Musharraf is the only general I know who is totally secular in his approach. But he's got to maneuver between his extremists who are sympathetic to Taliban and al-Qaida and moderate elements with a Western outlook. We forget that right after Sept. 11 he was given a stark choice by President Bush: either you abandon your support of the Taliban regime in Afghanistan or face the disintegration of Pakistan. There is an interesting study of Pakistan's Inter-Services Intelligence agency that says 20 percent of the Pakistani army's officer corps is fundamentalist.
Q: So what do you feel the United States can do there now?
A: There is very little, if anything, the U.S. can do to influence the course of events in Pakistan that wouldn't make matters worse. Any U.S. interference in Pakistan would result in Pakistan's four provinces becoming four failed states. And then what happens to Pakistan's nuclear arsenal? It's a horrendous festering problem. The Feb. 18 elections may bring a little clarity and hopefully democratic stability to Pakistan, but I am not holding my breath.
Q: But Afghanistan cannot be stabilized until Taliban and al-Qaida are flushed out of FATA (Federally Administered Tribal Areas), failing which we could see the collapse of NATO in Afghanistan?
A: I'm surprised at NATO, some of whose members have such short memories. They can't seem to project into the future their experiences of the past. Do they believe the Russians have been defanged forever? Do they believe Europe is at peace and can remain at peace forever? This is a globalized world. So for NATO members to balk at casualties when America came to rescue them in two world wars, I simply cannot fathom. I guess it has to do with the mood in Europe, which is appeasement, and the shift from papa Bush to Madeleine Albright as the indispensable power with an uncertain trumpet, and then, of course, the neocons who persuaded the Europeans that it was America's show, and no longer theirs. Supposing America had kept to the papa Bush line of thinking and coalition building, Europe would have understood that while they are targeting America today, Europe would be next.
Q: So you do feel that NATO's future is at stake in Afghanistan?
A: No doubt about it. But you should also realize Afghanistan cannot succeed as a democracy. You attempted too much. Let the warlords sort it out in such a way you don't try to build a new state. The British tried it and failed. Just make clear if they commit aggression again and offer safe haven to Taliban, they will be punished.
Q: If NATO collapsed in the wake of a failed campaign in Afghanistan, would that be a major concern of yours in Singapore?
A: Not immediately, but overall the balance of power would be upset.
Q: In whose favor?
A: China and Russia. They would be faced with a much weakened West in the ongoing global contest. I can also see the danger if America loses heart and says to hell with it all because the Europeans are not helping and the Japanese are blocking this and that, and tokenism from all the others. Let's not forget that what we're all enjoying today is the result of Pax Britannica and Pax America over the past 100 years. So don't give it up.
Q: In the next 12 months, China, in this New Year of the Rat (Feb. 7) that you are now celebrating, will mark its transformation in the past three decades from one of the poorest countries in the 20th century into the world's third-largest economy, soon to displace Germany, as the globe's new engine room of economic growth. Will China be to the 21st century what America was to the 20th?
A: The Chinese leadership has come to the conclusion if they stay on their present course, the peaceful rise of China's power will prevail. They are determined not to challenge any existing power, meaning America, EU, Russia, but just make friends with everybody. Given the rules of the game now that China is in WTO, they can only grow stronger year by year, and within three or four decades, China's GDP will be equal to America's, their technology will be equal to what was long regarded as the world's only superpower, and their GDP will be larger than America's. And all that stems from what they have long studied in detail in Taiwan, Hong Kong and Singapore. When Deng Xiaoping came to Singapore he was amazed at what he saw, as his briefing papers did not tally with his own eyes. That's when he must have concluded the Communist system didn't work. He could see how we were exploiting Western capitalism and had plants all over the place with cheaper labor and exporting goods all over the world. Hell's bells, he said, we can do that, too. That's when China began setting up special economic zones around coastal cities. They saw Hong Kong, Taiwan and Singapore with the advantages of close ties with the West, access to Western technology, export markets, knowledge, capital and an educated workforce. Now with WTO, they are on the same course, sending 250,000 students abroad every year, and even though they may lose 60 percent to 70 percent of them to other countries, they don't care because they know many of them will come back eventually. Year by year, they're closing the gap.
Q: And all this peacefully?
A: I watched "The Rise of the Great Powers" and I was amazed at this scholarly job by noted historians. No Communist or leftist jargon. How did some of these powers rise in history? Tiny little Portugal? Naval technology, pure and simple. Christopher Columbus? Spain? Tiny Holland, the French, the British, the armada, what was the trick? Technology plus governments that united the people in a common objective toward growth.
Q: Can the Chinese keep a one-party state going in this age of mass media, the Internet, and almost 100 million blogs?
A: I was quite surprised when this television program analyzed the British rise to global power status. The barons brought the king to Magna Carta, and said you will rule through us, Parliament, not divine right, but divine right through us. And when the king misbehaved, such as Charles I, he was beheaded. It was subversive to advocate cutting off the head of the Communist Party, but in today's China the people have confidence in the leaders because they allowed the once-hated merchant class to emerge and grow. That's the same dynamics that once created the East India Company and created an empire.
Q: So you see China on the same glide path?
A: I think so. But they want to avoid building a pre-World War II Japan or a Germany. Territorial conquest is not necessary as it once was. You don't have to be a genius to know that they are producing five times as many engineers and scientists as the Americans. What is it they need most now? Roads, railways, infrastructure. They are everywhere in Africa, in the Arab world, Latin America. China is everywhere today. Can you be everywhere while focused on Iraq? In the Caribbean you have one embassy in Barbados that serves six other tiny island countries. The Chinese have an embassy in each place. And that's what you call your front yard.
Q: Are you saying this will be China's century?
A: No, no, I don't think so. They will want to share this century as co-equals. By 2030, it will be a different world. They won't invade Taiwan and try to take over militarily. That would be far too costly for them all over the world. The U.S. Pacific commander said, "Look, you've got all these forces trained to knock off our 7th Fleet and if Taiwan declares its independence you will have to move. I would be quite happy to leave it as it is, but not Beijing." In my opinion, Chinese leaders would also be happy to leave it as it is. Taiwan goes to America to get its technology, which then transits to China. If they take back Taiwan, it becomes Chinese without the same freedom of access to U.S. technology and research labs. So why kill the goose that lays the golden eggs? The Chinese are quite comfortable leaving Taiwan the way it is.
Q: The nature of conflict is changing to an era of asymmetric warfare when one micro actor can neutralize or blunt a macro power. A few weeks ago, when five Iranian speedboats were darting in and out of three major U.S. warships steaming through the Strait of Hormuz, had they been loaded with super explosives, could have immobilized U.S. naval power the way al-Qaida attacked the USS Cole in Aden in October 2000.
A: But again, can the Chinese land troops in Taiwan and establish and hold and widen a beachhead? The answer is no. Can they conquer Taiwan militarily? Again, no. They can only inflict damage.
Q: But in the Gulf, if the U.S. and/or Israel bombed Iran's nuclear facilities, Iran has formidable asymmetrical retaliatory capabilities?
A: But let me repeat, they cannot conquer you. Hezbollah cannot conquer Lebanon. They can create trouble for the non-Hezbollah Lebanese. So micro actors can cause a lot of trouble for your friends, but they can't eradicate them.
UPI: Unless you've read science fiction, it's pretty hard to keep up with the ever-quickening pace of the revolution in technology. From the newfound ability to create artificial life to the now visible horizon of new supercomputers -- IBM's latest can compute at the rate of 1,000 trillion operations per second, up from 73 trillion -- that will surpass the human brain in every respect, to the current fusion of IT, biotech, nanotech and robotics. Humanity appears to be morphing from homo sapiens to homo connectus in one generation. Where do you see humankind going in the 21st century?
Lee: I give up! Because I no longer understand, let alone relate. I didn't do science beyond high school, but at least I could understand the world around us, from totalitarian dictators out to rule the world to the pushback on freewheeling, anything-goes democracy. Now I read learned articles that don't tell me why all this new stuff is happening. I learn new words daily, like biopharmaceuticals and biologics and send them to my secretary for an explanation, and the answer comes back, from Google or somewhere on the Internet.
When I was in Riyadh (Saudi Arabia) recently, I was watching a BBC documentary, a sparkling, fascinating talk by Craig Ventner, the human genome scientist, who covered the whole field of tomorrow in 50 brilliant minutes. I was transfixed by the part about creating artificial life. But I can't figure out what it all means and where are we going.
Q: You are not alone. Most political leaders in today's world have the same handicap. We already have 1 billion people online around the world and 2 billion mobile phones for 6.5 billion people, all providing information as well as disinformation, streaming video, chat rooms, blogs, which are rapidly reaching the 100 million mark. What does this tell you about the impact on democratic government, dictatorship and national sovereignty?
A: I think national sovereignty will be around for a long while because it is the framework for activities between states. The alternative is a free-for-all chaos in the world. Suppose you have dozens of countries going through the kind of mayhem you now see in Kenya, all the technological paraphernalia in the world won't be of much help. It would be back to the Stone Age.
Q: But as you were watching that BBC documentary what was going through your mind about where all this is leading?
A: I do not buy the optimistic jargon about a new age of enlightenment. But as I watched Dr. Ventner's prediction about carbon-free fuel, I say then what? You can desalinate all the oceans of the world, then what? And we will still have the overpopulation problem. My conclusion is there are certain moral and physical limits to what mankind can do on this small planet. If you begin with human history from the earliest tribes, we still haven't moved beyond instinctive responses.
Q: But what you were watching also told you that anyone born today will live to be 120 and productive almost until the end, and the 22nd century will see 250 years as a normal lifespan.
A: And then what! It makes no sense. Three score and 10 is not a bad span. Lead a good productive life and leave the future to your progeny. I fear the future for my grandchildren may not be as good as ours was. In Singapore, we now have in our physically limited space 4.5 million people, 3.2 million of them our citizens, the rest foreigners who came to work here. Our planners are projecting 6.5 million. Our planners and demographers can already see 6.5 million. I said to them, "Look, go slow. It can't be done in our small city state."
Q: Nanotechnology will enable us to build skyscrapers two to three times higher.
A: Not while I'm still around.
Q: You also have a brain drain?
A: Yes, we're losing them to America.
Q: Not China?
A: No, there they have to compete against 1.3 billion people producing huge numbers of very bright people. They'd rather go to America where they become acclimatized, then go to China with an American firm. Chinese speakers, they are part of an American team with a leg up on their Chinese competitors. And from there, they can come back to Singapore with the kind of experience that puts them at the top of their game. Those who seek less rigorous competition, a more relaxed lifestyle, go to Canada and Australia.
Q: How many top brains do you consider lost to Singapore every year?
A: At the top end, about 1,000 a year. That's a loss of 4 percent or 5 percent. But compensating that, we have Chinese and Indians coming here looking for better prospects. So on balance, we're still gainers. But the day will come when China, in 30 or 40 years, will offer better prospects than any country in the world.
Q: Switching to the future of capitalism the subprime mortgage predatory fiasco gave the entire world the vision of another great depression. Major banks in the U.S. and Europe lost close to $300 billion to this gigantic fraud.
A: From time to time, smart crooks get the better of people. They skewer the system. I don't believe you can find a substitute for democratic capitalism. Let's not forget the human being's desire to do well for himself/herself, his/her spouse, kids, parents. And then, when you do well, have compassion for one's fellow human beings who are behind the curve. The system that maximizes this is the system that also gives the highest motivation to do better. Mao's China experimented with the idea of a new human being, the super worker. It was an abysmal failure. But even at the height of the Communist folly, I went to China and one of our escorts took off his Mao jacket to show us it was fur-lined, a sign he was doing better than the others. Therefore, not equal.
I do not believe you can predict how human beings and societies will evolve. If we reach the point of global population saturation, we will have to craft new strategies to protect ourselves. Take Singapore. Yes, we want ASEAN, yes we want the European Union model. But supposing I said, "Yes, and we also want the Schengen Accord," which would mean any access to an Asian country in this new union would give you automatic, uncontrolled access to Singapore, and our people would laugh at me. There will, of course, be entities that will say to each other, "We're part of the same camp, or oasis, and we can share each other's assets." But I can't have people entering freely and setting up plastic tents in my garden. So when you reach an advanced state of development, what kind of an organization do you need? I frankly don't know.
Q: So how do you see the future of capitalism?
A: As chairman of the equivalent of our Sovereign Wealth Fund, we examine and decide where to invest our money, in equities or bonds or what have you. Our fund managers are paid five times what I get. Why? Because they have had good track records in growing our fund and we know what they could command in the private sector. They are dealing with billions of dollars every day and must be compensated accordingly.
Unbridled capitalism, winner takes all like in America, does not work unless you can cope with an underclass. So here we also stay with the losers, make sure they have enough to live on, with healthcare, equal education opportunities for their children whose parents can no longer afford it. It's very important they not feel abandoned. So we have workfare and ingenuous ways to keep them working as we don't want layabouts doing nothing. We also subsidize homes which they would not be able to buy. A society can only survive if there is a sense of equity and fair play.
Q: So to conclude, back to what concerns you most about the next 10 years, including WMD terrorism?
A: First whether America will face this next rough patch without losing heart. Afghanistan cannot succeed as a democracy, nor as a new state defying centuries of tradition. To remake societies is beyond the capacity of any nation. America as a superpower has global responsibilities -- but that's not one of them. Utopias have no place in geopolitics.
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by Arnaud De Borchgrave
Singapore (UPI) Feb 8, 2008
UPI Editor at Large Arnaud de Borchgrave interviewed Singapore's Minister Mentor Lee Kuan Yew on Feb. 2. The following is the text of the interview.
UPI: How do you see Iraq?
Lee: I do not want to say anything that would hurt President Bush because I believe he went in with the best of intentions. He put his trust in Dick Cheney. And I had trust in Dick Cheney as the voice of experience -- oil business executive, defense secretary during the first Gulf War (1990-91). But I don't know what happened to Dick Cheney. He allowed himself to believe with Richard Perle and the neocons you could change Iraq. How could you change Iraq, a 4,000-year-old society that is not malleable? Everybody knows the troubles the British had during and after World War I. Ideology should have no place when making geopolitical assessments.
George W. Bush, whatever his faults, is not walking away from what was started, which is just as well otherwise further damage will be done.
Q: And the next president?
A: Of all the candidates who will inherit the problem, I prefer John McCain. He will see this thing through. Walking away from it would also have disastrous consequences. If Afghanistan is a failed state, it's not your fault. No one has ever made sense out of it. But if you leave Iraq in its present state, you will have even bigger problems throughout the entire Middle East. The Shiites will get together. The Iraqi Shia will become dependent on Iran, and the Iranians will have mastery of that critically important Gulf area.
Q: So what is your recommendation about Iran's nuclear ambitions?
A: Is it now unstoppable. They are a very old civilization. Unlike the Arabs, apart from Mesopotamia valley, they rank with the Chinese, as history's two principal civilizations worth talking about. And I think the mullahs and others want to go back to the days of empire.
Q: So should we be talking to them at the highest level, the way Henry Kissinger went to China?
A: (Chuckle) But you haven't got a Kissinger or a Brzezinski to do that anymore. Where is the successor generation of geopoliticians?
Q: In fact, democracies don't produce great statesmen anymore. Why?
A: You now have, and I don't know how long this phase will last, mass media domination, owned by a group of media barons who want constant change for their balance sheets.
Q: So the power of mass media has made it impossible for a great statesman or woman to emerge and last any length of time?
A: I'm not sure. It depends on the nature of the crisis that must be faced. When a real crisis sets in, a matter of life and death, opinion formulators realize this is no time to be pontificating, but a time to stay the course with someone who understands what this is all about. Short of that, the media help put a leader on the pedestal and then start chopping away at the pedestal until he/she falls in disgrace. That's part of the cycle of constant change. Watch Sarkozy in France. They hoisted him up to prominence and now they're already attempting to bring him down through his personal life.
Q: But didn't Sarkozy contribute to what you call the cycle?
A: Well, yes. But it's also the enormous pressure of media competition and the giant appetite for advertising revenue, what television program gets what viewership, or eyeballs, or clicks online. Never mind the consequences. If you get the advertising, you win.
Q: We have a whole new generation that doesn't read newspapers, but get their news online. The average age of a newspaper reader in the United States today is 55.
A: So I'm a dinosaur (laughs).
Q: When I last interviewed you in May 2001, I asked you what concerned you most about the next 10 years, and you replied, "an Islamist bomb, and mark my words, it will travel." Four months later, we had Sept. 11. Secondly you said, "China and India's challenge to the global status quo." Do you still have the same concerns about the next 10 years?
A: Not quite. The Islamic bomb has traveled already (in Iran). I'm not sure how this will now play out. The U.S., the Europeans, even the Russians, will have to make up their minds whether to allow Iran to go nuclear. The Russians are playing a game, posing as the nice guys with Iran, supplying nuclear fuel, and making it look as if America is causing all this trouble. But if I were Russia today, I would be very worried about Iran acquiring the bomb, because Russia is more at risk than America. The risk Israel runs is another dimension. Russia is at risk because whether it's the Chechens or Central Asian Muslim states that were former Soviet republics, none are friendly to Moscow. Next time there's an explosion in Moscow, it may be a suicide bomber who isn't wearing an explosive belt or jacket, but something a lot bigger. It would certainly be in Russia's interest to say at some future point to Iran, "this far and no further." It could also be that Russia no longer knows how to stop it, in which case the Russians will be opening the door to a very dangerous world of nuclear proliferation. You can be quite sure that if and when Iran gets the bomb, the Middle East will go nuclear.
Q: Which raises the question of the United States or Israel bombing Iran's nuclear facilities.
A: (long silent pause) ¿¿ I can express no views on that.
Q: The Israelis say they are facing an existential crisis.
A: No question, they are at risk.
Q: As I travel in moderate Muslim states in North Africa, the Middle East and South Asia, I ask heads of state and government how many extremists, or would-be jihadis, they estimate live in their midst, also how many fundamentalists who support openly or secretly the jihadi cause. The answer is usually 1 percent and 10 percent. In a country like Pakistan, that translates to 1.6 million extremists and 16 million supporters. On a global scale, that comes out to roughly 14 million extremists and 140 million sympathizers.
A: Yes, but I do not see them winning, and by that I mean able to impose their extremist system. I can see them inducing fear and insecurity, and causing fear, but they don't have the technology and the organization to overwhelm any government.
Q: So how do you assess the global threat since Sept. 11? What are we doing that's right and also that's wrong?
A: Even if we can't win, we mustn't lose or tire. We cannot allow them to believe they have a winning strategy, and that more suicide bombers and WMD will advance their cause and give them a chance to take over.
Q: So we're doing the right thing?
A: No. Iraq was a mistake. I've said this before and I said this in the presence of Paul Wolfowitz, one of the architects of the invasion, at an IISS conference two months after the fall of Saddam Hussein, when someone asked me what will happen in Iraq. In October 2002, I was in Washington and became quite convinced an invasion would take place. On the way home, I stopped in London and asked Tony Blair to brief me. After 45 minutes, I said, "Look I accept the argument that with British and American military capabilities it would be a walk over, but then what do you do the day after? Blair replied, "That's up to the Americans." I then said to Blair, "If you were in charge, what would you do?" His political adviser then stepped in and said, "We would appoint the strongest pro-Western general and then get out quickly." So I repeated all that at the IISS conference and explained this reflected the institutional memory of what the British had been through in Iraq in the early 1920s. Paul Wolfowitz stood up in high dudgeon. So to placate him, I said, "Of course the British don't have the resources you have."
Q: Did Wolfowitz ask anything of you?
A: Yes, he came to my office to ask that Singapore send police trainers to Iraq. I had known Paul since his days as an ambassador at the State Department. I said, "Paul, do you realize how long it takes to train a policeman in Singapore? And that's only in one language, English, and it still takes two years. And you want me to teach Iraqis how to do it in three months in English? No, he replied, we'll supply translators. This is an emergency, he said, and many nations are helping us. So I replied OK, but we'll do it in Amman, Jordan, not Baghdad, where we would become the targets of suicide bombers. When he told me they had disbanded Saddam's police force, I became very nervous. Because when the Japanese came down here in World War II, 20,000 of their troops captured 90,000 British, Indian and Australian troops. They sent them into captivity, but they left the local police in charge, and kept all the other positions of the British administration intact -- from power management to the gas board -- and simply put Japanese in charge of each British position. And 20,000 Japanese troops moved on to Java. But in Iraq, you disbanded everything, and tried to run things without the former Baath party officials who had been in charge of civil administration. You created an ungovernable vacuum.
Q: Why do you think this was so?
A: From Day One, the idea of remaking Iraq, without the civil service in place and without recalling Saddam's army to service, showed a frightening lack of understanding of local conditions and elementary facts of political and economic life in Iraq. In ancient days, those who invaded and conquered China on horseback got off their horses and applied themselves to the more difficult job of governing.
Q: Did Iraq have anything to do with al-Qaida?
A: Of course not, as became clear in the daily sessions the imprisoned Saddam spent with his Arabic-speaking FBI interrogator over several months before his execution. But U.S. authorities were convinced Saddam was secretly supporting al-Qaida with weapons and training and maybe even WMD. So therefore the imperative became the elimination of Saddam.
Q: Switching to Pakistan, most terrorist trails in the United Kingdom and most recently in Germany via Turkey, track back to training camps and madrassas in the tribal areas that straddle the Pakistan-Afghanistan border.
A: We even had a terrorist of Pakistani descent here in Singapore.
Q: So what's your view of what should be done about the Pakistan-terrorist nexus?
A: (Laughs for several seconds) We should learn to live with it for a long time. My fear is Pakistan may well get worse. What is the choice? (President) Musharraf is the only general I know who is totally secular in his approach. But he's got to maneuver between his extremists who are sympathetic to Taliban and al-Qaida and moderate elements with a Western outlook. We forget that right after Sept. 11 he was given a stark choice by President Bush: either you abandon your support of the Taliban regime in Afghanistan or face the disintegration of Pakistan. There is an interesting study of Pakistan's Inter-Services Intelligence agency that says 20 percent of the Pakistani army's officer corps is fundamentalist.
Q: So what do you feel the United States can do there now?
A: There is very little, if anything, the U.S. can do to influence the course of events in Pakistan that wouldn't make matters worse. Any U.S. interference in Pakistan would result in Pakistan's four provinces becoming four failed states. And then what happens to Pakistan's nuclear arsenal? It's a horrendous festering problem. The Feb. 18 elections may bring a little clarity and hopefully democratic stability to Pakistan, but I am not holding my breath.
Q: But Afghanistan cannot be stabilized until Taliban and al-Qaida are flushed out of FATA (Federally Administered Tribal Areas), failing which we could see the collapse of NATO in Afghanistan?
A: I'm surprised at NATO, some of whose members have such short memories. They can't seem to project into the future their experiences of the past. Do they believe the Russians have been defanged forever? Do they believe Europe is at peace and can remain at peace forever? This is a globalized world. So for NATO members to balk at casualties when America came to rescue them in two world wars, I simply cannot fathom. I guess it has to do with the mood in Europe, which is appeasement, and the shift from papa Bush to Madeleine Albright as the indispensable power with an uncertain trumpet, and then, of course, the neocons who persuaded the Europeans that it was America's show, and no longer theirs. Supposing America had kept to the papa Bush line of thinking and coalition building, Europe would have understood that while they are targeting America today, Europe would be next.
Q: So you do feel that NATO's future is at stake in Afghanistan?
A: No doubt about it. But you should also realize Afghanistan cannot succeed as a democracy. You attempted too much. Let the warlords sort it out in such a way you don't try to build a new state. The British tried it and failed. Just make clear if they commit aggression again and offer safe haven to Taliban, they will be punished.
Q: If NATO collapsed in the wake of a failed campaign in Afghanistan, would that be a major concern of yours in Singapore?
A: Not immediately, but overall the balance of power would be upset.
Q: In whose favor?
A: China and Russia. They would be faced with a much weakened West in the ongoing global contest. I can also see the danger if America loses heart and says to hell with it all because the Europeans are not helping and the Japanese are blocking this and that, and tokenism from all the others. Let's not forget that what we're all enjoying today is the result of Pax Britannica and Pax America over the past 100 years. So don't give it up.
Q: In the next 12 months, China, in this New Year of the Rat (Feb. 7) that you are now celebrating, will mark its transformation in the past three decades from one of the poorest countries in the 20th century into the world's third-largest economy, soon to displace Germany, as the globe's new engine room of economic growth. Will China be to the 21st century what America was to the 20th?
A: The Chinese leadership has come to the conclusion if they stay on their present course, the peaceful rise of China's power will prevail. They are determined not to challenge any existing power, meaning America, EU, Russia, but just make friends with everybody. Given the rules of the game now that China is in WTO, they can only grow stronger year by year, and within three or four decades, China's GDP will be equal to America's, their technology will be equal to what was long regarded as the world's only superpower, and their GDP will be larger than America's. And all that stems from what they have long studied in detail in Taiwan, Hong Kong and Singapore. When Deng Xiaoping came to Singapore he was amazed at what he saw, as his briefing papers did not tally with his own eyes. That's when he must have concluded the Communist system didn't work. He could see how we were exploiting Western capitalism and had plants all over the place with cheaper labor and exporting goods all over the world. Hell's bells, he said, we can do that, too. That's when China began setting up special economic zones around coastal cities. They saw Hong Kong, Taiwan and Singapore with the advantages of close ties with the West, access to Western technology, export markets, knowledge, capital and an educated workforce. Now with WTO, they are on the same course, sending 250,000 students abroad every year, and even though they may lose 60 percent to 70 percent of them to other countries, they don't care because they know many of them will come back eventually. Year by year, they're closing the gap.
Q: And all this peacefully?
A: I watched "The Rise of the Great Powers" and I was amazed at this scholarly job by noted historians. No Communist or leftist jargon. How did some of these powers rise in history? Tiny little Portugal? Naval technology, pure and simple. Christopher Columbus? Spain? Tiny Holland, the French, the British, the armada, what was the trick? Technology plus governments that united the people in a common objective toward growth.
Q: Can the Chinese keep a one-party state going in this age of mass media, the Internet, and almost 100 million blogs?
A: I was quite surprised when this television program analyzed the British rise to global power status. The barons brought the king to Magna Carta, and said you will rule through us, Parliament, not divine right, but divine right through us. And when the king misbehaved, such as Charles I, he was beheaded. It was subversive to advocate cutting off the head of the Communist Party, but in today's China the people have confidence in the leaders because they allowed the once-hated merchant class to emerge and grow. That's the same dynamics that once created the East India Company and created an empire.
Q: So you see China on the same glide path?
A: I think so. But they want to avoid building a pre-World War II Japan or a Germany. Territorial conquest is not necessary as it once was. You don't have to be a genius to know that they are producing five times as many engineers and scientists as the Americans. What is it they need most now? Roads, railways, infrastructure. They are everywhere in Africa, in the Arab world, Latin America. China is everywhere today. Can you be everywhere while focused on Iraq? In the Caribbean you have one embassy in Barbados that serves six other tiny island countries. The Chinese have an embassy in each place. And that's what you call your front yard.
Q: Are you saying this will be China's century?
A: No, no, I don't think so. They will want to share this century as co-equals. By 2030, it will be a different world. They won't invade Taiwan and try to take over militarily. That would be far too costly for them all over the world. The U.S. Pacific commander said, "Look, you've got all these forces trained to knock off our 7th Fleet and if Taiwan declares its independence you will have to move. I would be quite happy to leave it as it is, but not Beijing." In my opinion, Chinese leaders would also be happy to leave it as it is. Taiwan goes to America to get its technology, which then transits to China. If they take back Taiwan, it becomes Chinese without the same freedom of access to U.S. technology and research labs. So why kill the goose that lays the golden eggs? The Chinese are quite comfortable leaving Taiwan the way it is.
Q: The nature of conflict is changing to an era of asymmetric warfare when one micro actor can neutralize or blunt a macro power. A few weeks ago, when five Iranian speedboats were darting in and out of three major U.S. warships steaming through the Strait of Hormuz, had they been loaded with super explosives, could have immobilized U.S. naval power the way al-Qaida attacked the USS Cole in Aden in October 2000.
A: But again, can the Chinese land troops in Taiwan and establish and hold and widen a beachhead? The answer is no. Can they conquer Taiwan militarily? Again, no. They can only inflict damage.
Q: But in the Gulf, if the U.S. and/or Israel bombed Iran's nuclear facilities, Iran has formidable asymmetrical retaliatory capabilities?
A: But let me repeat, they cannot conquer you. Hezbollah cannot conquer Lebanon. They can create trouble for the non-Hezbollah Lebanese. So micro actors can cause a lot of trouble for your friends, but they can't eradicate them.
UPI: Unless you've read science fiction, it's pretty hard to keep up with the ever-quickening pace of the revolution in technology. From the newfound ability to create artificial life to the now visible horizon of new supercomputers -- IBM's latest can compute at the rate of 1,000 trillion operations per second, up from 73 trillion -- that will surpass the human brain in every respect, to the current fusion of IT, biotech, nanotech and robotics. Humanity appears to be morphing from homo sapiens to homo connectus in one generation. Where do you see humankind going in the 21st century?
Lee: I give up! Because I no longer understand, let alone relate. I didn't do science beyond high school, but at least I could understand the world around us, from totalitarian dictators out to rule the world to the pushback on freewheeling, anything-goes democracy. Now I read learned articles that don't tell me why all this new stuff is happening. I learn new words daily, like biopharmaceuticals and biologics and send them to my secretary for an explanation, and the answer comes back, from Google or somewhere on the Internet.
When I was in Riyadh (Saudi Arabia) recently, I was watching a BBC documentary, a sparkling, fascinating talk by Craig Ventner, the human genome scientist, who covered the whole field of tomorrow in 50 brilliant minutes. I was transfixed by the part about creating artificial life. But I can't figure out what it all means and where are we going.
Q: You are not alone. Most political leaders in today's world have the same handicap. We already have 1 billion people online around the world and 2 billion mobile phones for 6.5 billion people, all providing information as well as disinformation, streaming video, chat rooms, blogs, which are rapidly reaching the 100 million mark. What does this tell you about the impact on democratic government, dictatorship and national sovereignty?
A: I think national sovereignty will be around for a long while because it is the framework for activities between states. The alternative is a free-for-all chaos in the world. Suppose you have dozens of countries going through the kind of mayhem you now see in Kenya, all the technological paraphernalia in the world won't be of much help. It would be back to the Stone Age.
Q: But as you were watching that BBC documentary what was going through your mind about where all this is leading?
A: I do not buy the optimistic jargon about a new age of enlightenment. But as I watched Dr. Ventner's prediction about carbon-free fuel, I say then what? You can desalinate all the oceans of the world, then what? And we will still have the overpopulation problem. My conclusion is there are certain moral and physical limits to what mankind can do on this small planet. If you begin with human history from the earliest tribes, we still haven't moved beyond instinctive responses.
Q: But what you were watching also told you that anyone born today will live to be 120 and productive almost until the end, and the 22nd century will see 250 years as a normal lifespan.
A: And then what! It makes no sense. Three score and 10 is not a bad span. Lead a good productive life and leave the future to your progeny. I fear the future for my grandchildren may not be as good as ours was. In Singapore, we now have in our physically limited space 4.5 million people, 3.2 million of them our citizens, the rest foreigners who came to work here. Our planners are projecting 6.5 million. Our planners and demographers can already see 6.5 million. I said to them, "Look, go slow. It can't be done in our small city state."
Q: Nanotechnology will enable us to build skyscrapers two to three times higher.
A: Not while I'm still around.
Q: You also have a brain drain?
A: Yes, we're losing them to America.
Q: Not China?
A: No, there they have to compete against 1.3 billion people producing huge numbers of very bright people. They'd rather go to America where they become acclimatized, then go to China with an American firm. Chinese speakers, they are part of an American team with a leg up on their Chinese competitors. And from there, they can come back to Singapore with the kind of experience that puts them at the top of their game. Those who seek less rigorous competition, a more relaxed lifestyle, go to Canada and Australia.
Q: How many top brains do you consider lost to Singapore every year?
A: At the top end, about 1,000 a year. That's a loss of 4 percent or 5 percent. But compensating that, we have Chinese and Indians coming here looking for better prospects. So on balance, we're still gainers. But the day will come when China, in 30 or 40 years, will offer better prospects than any country in the world.
Q: Switching to the future of capitalism the subprime mortgage predatory fiasco gave the entire world the vision of another great depression. Major banks in the U.S. and Europe lost close to $300 billion to this gigantic fraud.
A: From time to time, smart crooks get the better of people. They skewer the system. I don't believe you can find a substitute for democratic capitalism. Let's not forget the human being's desire to do well for himself/herself, his/her spouse, kids, parents. And then, when you do well, have compassion for one's fellow human beings who are behind the curve. The system that maximizes this is the system that also gives the highest motivation to do better. Mao's China experimented with the idea of a new human being, the super worker. It was an abysmal failure. But even at the height of the Communist folly, I went to China and one of our escorts took off his Mao jacket to show us it was fur-lined, a sign he was doing better than the others. Therefore, not equal.
I do not believe you can predict how human beings and societies will evolve. If we reach the point of global population saturation, we will have to craft new strategies to protect ourselves. Take Singapore. Yes, we want ASEAN, yes we want the European Union model. But supposing I said, "Yes, and we also want the Schengen Accord," which would mean any access to an Asian country in this new union would give you automatic, uncontrolled access to Singapore, and our people would laugh at me. There will, of course, be entities that will say to each other, "We're part of the same camp, or oasis, and we can share each other's assets." But I can't have people entering freely and setting up plastic tents in my garden. So when you reach an advanced state of development, what kind of an organization do you need? I frankly don't know.
Q: So how do you see the future of capitalism?
A: As chairman of the equivalent of our Sovereign Wealth Fund, we examine and decide where to invest our money, in equities or bonds or what have you. Our fund managers are paid five times what I get. Why? Because they have had good track records in growing our fund and we know what they could command in the private sector. They are dealing with billions of dollars every day and must be compensated accordingly.
Unbridled capitalism, winner takes all like in America, does not work unless you can cope with an underclass. So here we also stay with the losers, make sure they have enough to live on, with healthcare, equal education opportunities for their children whose parents can no longer afford it. It's very important they not feel abandoned. So we have workfare and ingenuous ways to keep them working as we don't want layabouts doing nothing. We also subsidize homes which they would not be able to buy. A society can only survive if there is a sense of equity and fair play.
Q: So to conclude, back to what concerns you most about the next 10 years, including WMD terrorism?
A: First whether America will face this next rough patch without losing heart. Afghanistan cannot succeed as a democracy, nor as a new state defying centuries of tradition. To remake societies is beyond the capacity of any nation. America as a superpower has global responsibilities -- but that's not one of them. Utopias have no place in geopolitics.
Friday, December 05, 2008
CEO Interview: Costco's Jim Sinegal
In this age where reports of CEO getting high wage package that is uncorrelated with their actual performance are common, I thought this article featuring Costco's CEO Jim Sinegal was so refreshing. This article was published in Fast Company (found here).
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Flat-screen TVs, wedding rings, mini-quiches, gallon jugs of mayo -- and, of course, free samples. America's fourth-largest retailer, which opened its first warehouse store 25 years ago this fall, is booming. Wall Street grumbles that Costco cares more about its customers and employees than its shareholders; it pays workers an average of $17 an hour and covers 90% of health-insurance costs for both full-timers and part-timers. Yet revenues have grown by 70% in the past five years, and its stock has doubled. In typically blunt language, cofounder and CEO Jim Sinegal makes his case for why "big box" and "progressive" aren't mutually exclusive.
You answer your own phone, you send your own faxes, you talk to customers and employees. What motivates you to stay involved in the details of the business?
Because I love it. I've been doing it all my life, and it's my style. That doesn't mean it's the right style or the style that works for everybody, but it's my style.
You recently announced that August same-store sales were up 9%, yet Wall Street analysts were unhappy because you hadn't met their expectations.
You know, that has nothing to do with reality. Analysts put their own numbers on things, and we can't help them there. We think that 9% in the state of this economy is pretty good.
Some of those analysts have argued that Costco's generosity to its workers hurts the company and its shareholders.
You have to recognize -- and I don't mean this in an acrimonious sense -- that the people in that business are trying to make money between now and next Thursday. We're trying to build a company that's going to be here 50 and 60 years from now. We owe that to the communities where we do business. We owe that to our employees, that they can count on us for security. We have 140,000 employees and their families; that's a significant number of people who count on us. We owe it to our suppliers. Think about the people who produce products for us -- you could probably multiply our family of employees by three or four times. And we owe it to our customers to continue to offer good prices. Our presence in a community makes pricing better throughout that community because when you have a tough competitor in the marketplace, prices come down.
Could we talk about your competition for a minute? Would you be willing to play a little game for us? Costco is to Sam's Club as _____ is to _____.
You're not going to get me to fall for that one. Listen, Sam's is a very formidable competitor. They're part of Wal-Mart. That's the biggest corporation ever in the world in terms of sales volume, and continuing to grow. They've made significant improvements to their Sam's operation. We watch them like a hawk. Hardly a week goes by that I'm not in a Sam's.
Do you buy anything?
I think I purchased one of their men's dress shirts one time, because I wanted to test it in comparison to ours. But I don't buy anything for consumption.
And obviously yours was better.
That's the reason I'm telling you the story [laughs]. No, I mean, we feel it's better. You know, you have to be careful not to delude yourself in what you're putting into a product. The final analysis is, the customers vote at the checkout.
What's the first thing you look for when you go into a Costco?
I try to approach the visits from the standpoint of a customer. Does the building have the right goods out? Is it well-stocked and clean and safe? Nothing is a bigger turnoff than poor housekeeping, most particularly in a place where you have food. Also, when you have a sloppy building, I can guarantee you're going to have high shrinkage [pilfering and shoplifting].
Sales on Costco's e-commerce site are expected to hit $1.6 billion this year, a 33% increase over 2007, and the average customer ticket is more than $400. What do you choose to put on the Web site as opposed to stocking in the regular warehouse?
We've generally tried to select items that are a little more unusual. For example, we've been offering floral arrangements for weddings. It's a complete package: The flowers for the tables and the flowers for the church and the flowers for the bridesmaids and boutonnieres for the men and the corsages for the ladies.
That seems unorthodox for a store like yours. Where do those kinds of ideas come from?
Certainly from our buyers, but they also come from our suppliers. When somebody sees that you're willing to take a chance on coffins, odds are they'll come up with some other good ideas.
Your coffin business is brisk?
They do well. They're generally special order. I think we sell more of them online than we do in our warehouses.
Are certain locations really great for coffins?
You mean like Florida [laughs]? No, no -- the unfortunate thing is people pass on everywhere.
What's done well that has surprised you?
Our Kirkland Signature wines. I thought, in that category of goods, people would be reluctant to take a house brand.
Kirkland Signature has become one of the most successful house brands out there.
There was so much pressure on prices going up, it created an umbrella for private labels to sneak in -- and under -- and to create significant savings. But we made up our minds that if we were going to make a private label, we weren't going to equivocate on the quality. Customers shop with us for value. They don't shop with us for cheap prices on cheap merchandise. They expect us to deliver value on quality.
What's an area that didn't work?
You don't have enough space in your magazine to talk about all the things that we've tried that didn't work out. Some time ago, we tried to get involved in the home-improvement business. We were going to have paint. There are places where you can get thousands of colors of paint. We were going to have four, and three of those were going to be white [laughs]. It's safe to say we underwhelmed the customer.
Do suppliers still balk at your policy of not marking products up more than 15%?
There will always be people who are going to be reluctant to sell to us. They use a lot of different excuses, but when you cut through all the defecation, the fact is, they don't want to see our prices on their merchandise. But most people have come around to say, "Hey, this is a pretty good company to do business with. They can sell a lot of our products." We have high-end customers. If anyone wants to purchase a Movado watch or Michelin tires or Waterford crystal, it's our customer.
How is the current economic climate impacting Costco?
We are subject to elements of the turndown just like everyone else. You might argue, "Well, gee, the value concept really holds these guys in good stead because people are looking for better pricing and perhaps are willing to go out of their way to find it." But Costco was developed to be cash-and-carry, catering primarily to businesspeople, and that business customer is probably seeing their business suffer a little bit, so their purchases are going to go down.
There are definitely purchases that are being deferred: patio furniture, housewares, and domestic products -- blankets and things like that. The upside is we're seeing more purchases of basic stuff like health and beauty aids and food. Apparel is doing reasonably well, but we're not in the business of selling $800 cocktail dresses.
Our healthiest business from a standpoint of sales growth has been in Asia; we're in South Korea and Taiwan and Japan. At the moment, our weakest, I would say, is in parts of California, Arizona, and around Las Vegas. Those are the places where we think more people have been hurt relative to this mortgage issue.
Are there economic issues you would like the next U.S. president to address?
I would like to see somebody paying attention to the deficits. I think they're significantly higher than have been stated, and they're not even taking into account the war or what's going to happen further down the line with Medicare and Social Security. How are we going to cover those costs? There's got to be some tough decisions made. These problems are not going to go away.
What's your stand on universal health coverage?
We should have it. I think that in the wealthiest nation in the world, it's a shame and disgrace that we don't. We try to provide a very comprehensive health-care plan for our employees. Costs keep escalating, but we think that's an obligation on our part.
What about high gas prices?
Even employees who work at Costco -- who make the type of wages that we pay -- are being hit at the gas pump. We're working very hard to schedule people from the same part of town so they can drive together. We're encouraging van pools. We're even testing 10-hour days, something we've never done in the past. If we can schedule some employees for four 10-hour days, that's one day they don't have to drive to work. They've got a 20% savings in their gas right there.
You've also installed skylights and solar panels in many of your buildings.
There's no sense in me BS-ing you. The reason we did it originally was exactly as you're suggesting -- to save money. We put the skylights in so that we didn't have to turn the lights on. But of course it's also environmentally correct. We also recycle all the boxes that the goods come in. And we're working on how we can simplify packaging and save on fuel. We just reconfigured our cashews. They were in a round canister, and we put them in a square canister. It sounds crazy, but we saved something like 560 truckloads a year of that one product. That's significant savings.
Is it true that you visit up to 12 Costco stores a day?
That's a legend I've tried to perpetuate, to keep everybody on their toes. You know, there certainly are days when I'll visit 12. I will be traveling to our warehouses every single week between now and Christmas. I love to hear the cash registers ring.
Wednesday, September 24, 2008
Minister Mentor Lee Kuan Yew's Interview on CNN
Even at the ripe old age of 85, his mind is still sharp.
Part 1
Part 1
Part 2
Friday, July 18, 2008
A.J. Jacobs: My year of living biblically
What if someone really lived his life according to the tenets of the Bible? Well, A.J. Jacobs did for a year, and this is his experience...
Wednesday, May 28, 2008
Tuesday, April 29, 2008
The Freeway Blogger
This will never work in Singapore though, with all the CCTVs and the lack of sense of humor from those in charge... Remember the white elephants at BuangKok MRT??
Sunday, April 27, 2008
Tony Benn Interview on Sicko Outtake
This is Tony Benn's interview by Michael Moore, not in the actual movie, but in the outtakes of the Sicko DVD. What he says is pretty enlightening.
Part 1
Part 2
Sunday, April 20, 2008
Clips From An Unreasonable Man
This is a clip from the documentary: An Unreasonable Man... When you hear Ralph Nader speaks and his friends talk about his accomplishments, you will have nothing but admiration for this man...
Friday, April 18, 2008
Ralph Nader on The Hour
This is an interview of Ralph Nader on the Canadian TV show, The Hour.
Part 1
Part 2
Part 1
Part 2
Wednesday, April 16, 2008
Ralph Nader On His Family's Seventeen Traditions
A talk by Ralph Nader on his book. The first part of the talk was an introduction on his book. It is the second part, the Q & A session, that is interesting...
Saturday, April 12, 2008
Bill Maher Interviews Richard Dawkins
One of the few interviews of Richard Dawkins where the interviewer agrees with him (i.e. is an atheist).
Thursday, April 10, 2008
No Atheists Here!!!
Rep. Monique Davis (D-Chicago) interrupted atheist activist Rob Sherman during his testimony Wednesday afternoon before the House State Government Administration Committee in Springfield and told him, "What you have to spew and spread is extremely dangerous . . . it's dangerous for our children to even know that your philosophy exists!
"This is the Land of Lincoln where people believe in God," Davis said. "Get out of that seat . . . You have no right to be here! We believe in something. You believe in destroying! You believe in destroying what this state was built upon."
Apparently it's still open season on some views of God.
Hopefully this will never happen in Singapore (although I know the people in general are quite religious)...
Keith Olberman has some comments on this incident in his "Worst Person" segment:
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