Dal's Blog on Huffington Post

Though I am still suffering from my addiction to trading in the stock market (see my twitter feed to follow my compulsive trading), I continue to celebrate Small Business Week by announcing my recent investments in small business. I have found and invested in another new small business which is run by passionate, competent and honest people. This investment leaves me less funds for trading and makes me feel better because I'm doing something constructive with my investment money rather than using it to play the stock market casino. Mamma Chia, an organic chia‐based food and beverage company based in San Diego, has launched its first‐to‐market, vitality beverage whose taste, appearance, nutritional value and story make it in my opinion one of the most exciting new food products in years. Chia seeds, an ancient grain, were used by both the Mayans and Aztecs for their amazing energy and natural healing powers. Rediscovered by a new generation of health‐conscious consumers, chia has exploded as the new super food. "It's the world's healthiest whole food," says Wayne Coates, PhD, professor emeritus at the University of Arizona. These extraordinary little seeds are packed full of nutrients such as 8x more Omega‐3 than salmon, 30% more antioxidants than blueberries, 4x more fiber than flaxseed, as well as 70% more protein than soybeans. Chia seeds naturally deliver powerful health benefits that speak to a wide variety of consumer needs, such as quick athletic recovery, heart health, fortified immune system and weight management. The beautifully bloomed chia seeds are suspended throughout a blend of organic fruit juices, giving it a unique depth and glow. Mamma Chia is a fun and refreshing drinking experience with exceptional taste and nutrients, and an enjoyable texture that differentiates it from all other beverages. I am not suggesting that you invest in this company. Even if you wanted to you couldn't since the investment round sold out. I am suggesting that if you can afford to invest, put your commitment into vibrant new companies, which create new jobs as well as new products. This type of investing is much more satisfying than buying stock in old established companies. One of my criteria for investing in small businesses is that they are run responsibly and, even better, that they have a social mission. Mamma Chia's social mission is building cooperative relationships with chia growers and is committed to supporting their organic certification efforts, social justice programs and overall community growth. Mamma Chia is also a Certified B Corporations ("B Corp"), which is a new type of corporation that uses the power of business to solve social and environmental problems. B Corps are unlike traditional businesses because they: meet comprehensive and transparent social and environmental performance standards; meet higher legal accountability standards; build constituencies for good business. Mamma Chia is also a member of 1% for the planet, a growing list of companies (now 1457 of them) that donate 1% of their sales to a network of 2,483 environmental organizations worldwide. Doing well by doing good is still alive at Mamma Chia.
It's slipping under the radar with all the news out of Washington the last several days, but this week is the 48th Annual Small Business Week. And as we continue to look for ways out of the economic mess we're in as a nation, it's worth calling attention to the fact that small businesses play a critical role in our economy. According to the Small Business Administration*, there are over 27 Million small businesses in America, and they account for 60-80 percent of the new jobs created in this country. If you've read my posts recently, you'll know that I've started pulling my money out of the casino that is the stock market and started investing it in businesses I can believe in. That's why, in celebration of Small Business Week, I've just invested in The One World Futbol Project. And I urge any of you with excess capital sitting in the stock market to celebrate with me by moving some of your funds as I did this Monday into a small business. The One World Futbol Project LLC (the "Project") manufactures and distributes the One World. Futbol -- a patent‐pending, ultra‐durable, non‐inflated soccer ball that solves a fundamental problem of traditional inflated balls: when used in the harsh environments that prevail in poor communities, a traditional inflated ball soon goes flat and becomes useless, while the One World Futbol stands up to such conditions and keeps the joy of sport alive. For retail sales, the Project uses a "Give One, Get One" business model, donating one ball for every one sold. The Project also sells the ball in bulk quantities directly to institutions, through corporate sponsorship, or through campaigns that mobilize members or supporters. Target institutional customers include U.N. agencies, regional multilateral agencies and NGOs, as well as the multinational corporations that are prime sponsorship prospects. The ultra‐durable One World Futbol maintains its shape and bounce by virtue of its structure and material -- not by being inflated. Unlike traditional soccer balls, it requires neither a pump nor a needle, never gets waterlogged, and continues to bounce even after it has been punctured. The One World Futbol is "Parent Tested, Parent Approved" and was named one of the "Top 10 Active Toys" of 2010 by Stevanne Auerbach, Ph.D. ("Dr. Toy"), and the Project was one of three finalists for the Special Jury Prize in the 2010 global Peace and Sport Awards. If you can't find a business to invest in let me know and I will introduce you to the way I find opportunities. Those of you sitting on the fence about starting a small business, you can celebrate Small Business Week by jumping off the fence and starting yours. Let me know about your business and I will publish it in my blogs and at my website. You can also get advice about starting your business in my book "Raising Eyebrows: A Failed Entrepreneur Finally Gets It Right" *As a side note, I am a big supporter of the SBA and was pleased to have my company Tweezerman nominated as Borrower of the Year in New York state back in 1994.
Your studies are complete, and as you start the mad dash to find a post-grad job, I hope you don't mind me offering a piece of advice that you may not have considered: Now is one of the best times in your life to start a business. One of the harder problems about being an entrepreneur is letting go of the security of the job you might have with some large company. Chances are this isn't your problem. You are not stuck in some job. Your resume is clear. You have little time (besides school) invested in a career. Coming fresh from school, you have a number of advantages that would serve you well in starting a business. Your classmates are one of the great resources you have. This network of friends is fresh. Your body of knowledge is current. Your former professors are more likely to be available now for advice and they aren't likely to charge you a consulting fee. And your level of energy and enthusiasm is very high now. Take advantage of all of this now that you can. There's still a lot of doom and gloom talk about the state of the economy. But it's important to remember that a period of economic of expansion has always followed recessions. No matter what people might be saying, the country is coming out of a recession. Plus many Americans are more inclined to do business with their neighbors than some large corporation. By starting your own business, you can also play an important part in the economic recovery. The country needs jobs to fuel the expansion. The patriotic thing to do is go out and create jobs not just take them. Take the plunge and start your own business now. Graduates of the Harvard Business School are doing just that. So my advice continues. Be organized - or forget it, be focused - on one product or service, be frugal - buy only what is essential and then buy used not new, and be patient - you will not make a million dollars overnight. A reason I failed at a series of my business attempts is that I thought I could. Do one thing, but do it better than anyone else. If you are thinking of working with a partner, find two partners - three of you will always be able to make decisions. Keeping score is an essential part of every game especially the game of business. Write down all your agreements; keep your business expenses separate from your personal ones and produce an income statement and balance sheet every month. While you are at it you can avoid some of the mistakes I made that are detailed in my book Raising Eyebrows, A Failed Entrepreneur Finally Gets It Right. Find something you can do with the limited amount of money you have or can easily get. (Go to my blog: Financing Your Dream Business to find out how I financed Tweezerman, my big success.) Don't procrastinate. Pick the right business. Make sure you can make or source the product you plan to sell. Make sure you can sell the product you plan to offer. Take calculated risks but don't gamble. Don't expect powerful people to empower you. They will more likely exploit you; that's how they became powerful. (Read my blog My Worst Mistakes.) Once your business is successful enough to support you then you can take it to the next level. Start with delegating the work and hiring people you empower. (Read Take Care of Your Employees and They Will Take Care of You.). Finally practice responsible capitalism. What this means is that your enterprise will benefit you but also your employees, your vendors, your customers, and your community. Why? Because not only will you feel so much better when you succeed my experience tells me you will also do better. Congratulations on your graduation, and good luck to you in your future. Dal LaMagna
I, and I believe a majority of Americans, are delighted to see that the banks, insurance companies and auto manufacturers which were so recently bailed out by the U. S. tax payer are doing so well. It seems like only yesterday they were threatening to die and bring down Western Civilization with them if they didn't receive money and lots of it. Now they (or at least their CEO's) seem to be doing just fine. I believe therefore this is the time those companies should show the tax payers a little love in return. I don't mean just having some square jawed, Mitt Romney look alike get on T.V. and say thanks, although that might be a start. What I would prefer to see is each one of these recipients of our largess step up and bail out the U.S. government in turn. Big companies should take over funding major government programs which are threatened to be defunded by ideological politicians. I can see a country where working people can look forward to their golden years with the sure knowledge that General Motors Social Security will be there. The indigent will be told "Pick out an organ. This transplant is on AIG." And wouldn't it be nice to hear "Welcome to Morgan Stanley Planned Parenthood. How may we help you?" You may wonder where the money will come from to finance this corporate bailout of the federal government. First, in the spirit of everybody sharing the sacrifice, executive compensation at these companies will be capped at just $10 million a year for each executive, not a penny more. As draconian as this approach is, I realize it is not the total solution. The rest of the funding will come from a revolutionary approach to corporate taxes: these companies will actually pay them. Just think of the savings. No more phony headquarters in the Caribbean or fake subsidiaries in Lichtenstein. And best of all no more need for thousands of tax attorneys whose job it is to avoid the payment of taxes. There you have it. Here is a plan to bail out the government in time of crisis and at the same time turn our mendicant corporations into model citizens. Not a bad morning's work. Written in collaboration with Frank Suttell
There has never been a better time to start a business than right now. To help revive our nation's economy, one of the most patriotic acts you can do is to create a job for yourself -- and eventually for others too. Many Americans have big dreams, but they don't have a lot of money to finance those dreams. I'm going to tell you how to start a viable business without big-time investors and a lot of seed money. Here's how I gathered the financial resources to get my company, Tweezerman, the global beauty tools company, off the ground. These lessons apply to every small business person with a dream and the will to make it happen. Put your money where your mouth is. How much do you believe in your idea? Make sure your business idea is so compelling and that you are so confident about your skill in executing it that you are willing to personally guarantee any loans you make. Your own money or money you can easily get -- that's where you need to begin if your intent is to build a company you own and control. Don't spend. Be unwavering in your commitment to avoid spending money when you start. Don't hire consultants, rent office space, buy new equipment, or spend any money you don't absolutely have to spend. Always ask the price of things before you buy them, and then ask for a better price. If you don't spend it, you don't have to raise it. Start with money you have. I was once told by a potential investor in one of my projects, who got annoyed with my badgering of him for money, "Go find something you can do with the money you have." At the time I didn't realize what good advice this really was. I started Tweezerman with all the money I had at the time, which was $500. I operated out of a 400-square-foot bungalow that was my office, warehouse, and home. I used free, recycled, and reused equipment and supplies, and sold the tweezers myself at first. Borrow, but borrow smart. When my company started to grow, I borrowed money from my father, then from friends, and then started using credit cards from there. I recommend that you start building your company with borrowed money rather than investors' money. Why? Because otherwise you're giving away too big a share of your business to an investor. What an investor will pay for a piece of your company is dramatically more when it's a proven entity than when it's merely your good idea. Once your company gets big, you won't have trouble attracting investors. I advise that you stay away from them in the beginning, however. Two rules of thumb for borrowing smart. First, everyone gets a legal document, whether it's your Aunt Betsy or a business associate. No handshake agreements. Whatever agreement you make at the outset -- interest rates, repayment schedules, stock options -- put it all in writing and have both parties sign it. And second -- very important -- stick to your agreement. Make all payments on time. My father told me, "Always pay your bills on time -- not a day early or a day late." Keeping your agreements builds your reputation and builds good business habits. Build your credit. Back in the 1980s, credit card interest rates were at 18 percent, and I was getting new card offers practically once a week. I acquired 45 credit cards and $185,000 of credit card debt before I convinced Chase Manhattan Bank to lend me money to pay off the cards. But because I had paid every card on time every month, sometimes with a new card that arrived in the mail, I had terrific credit and Chase was willing to back my enterprise. Good credit is something every new businessperson can easily achieve and maintain. On the other hand, it's very difficult to get it back once you've blown it. Offer your lenders convertible debt. Still trying to avoid giving away equity for the money I needed to grow, I financed Tweezerman by offering convertible debt to family, friends, and business associates. Here's how it worked. I borrowed money from people and subordinated their notes to the bank. (Translation: I had them sign a note saying that the bank always gets paid first.) Obviously, banks look upon such agreements favorably, and it assured I could always get a traditional bank loan. I paid my personal lenders 8 percent interest a year, making semi-annual payments -- always on time. I gave my circle of lenders the right to convert the note to stock at the end of the year at a predetermined conversion rate. I set up the loan-to-stock-conversion rate by estimating what the company would be worth in two years. I reasoned that as long as Tweezerman was earning 10 percent profits on sales, the company would be worth whatever one year's sales were. Then to keep things simple, I authorized one million shares of stock. This way, anyone who owned stock could figure out what a share was worth. If our sales were 2.2 million dollars, each of the one million shares of stock was worth $2.20. Your vendors could help you finance your growth. Meanwhile, I was also raising money from my vendors by convincing them to give me extended payment terms. The times when I was late paying them, I voluntarily paid them the same amount of interest on the past due amount that I was paying for my bank loan. At first my foreign vendors wanted me to pay for my tweezers before they shipped them. Eventually, however, I got most of them to hold my invoices 90 days. Managing cash flow like this is akin to getting short-term loans. In addition to being reliable and offering my vendors a financial incentive for letting me get my inventory on credit, I made sure to spend face time with them so I was more than a name on a contract. I visited these vendors once a year until we had such a good relationship we could do business by phone. Be "accountable" to keep your bank and backers happy. Every month, without missing a month during those early years, I prepared a management income statement and balance sheet and sent it out to my bank, convertible note holders, and anyone who I thought might one day be interested in investing. We also gave the bank projections, which were always conservative, and met them every year. If something went wrong, we notified the bank immediately. My banker came to trust us and over the years extended more and more credit to us. Initiating this kind of up-front communication created an excellent, if not old-fashioned, relationship with my banker. It also gave the convertible note holders a sense that they were involved in a thriving and growing company. Don't stick your stockholders with the tax bill. The company's sales and profits grew steadily. Not surprisingly, most of my convertible note holders eventually converted their notes into stock. To avoid double taxing (taxes on the corporation coupled with taxes on the people who get dividends from the corporation) the company was organized as a Subchapter S Corporation. The shareholders directly pay their share of the taxes on the profits the company makes. I always distributed 50 percent of the profits to my shareholders so they could pay their taxes. This is a requirement I now insist on if I invest in a company. It's surprising how many similar companies don't do that. Don't pocket the cash. I always deposited all the money I got from selling our products, including the cash we got when we did the international beauty shows. I remember when my bank made its first loan to me, and I asked them, "Why now?" The loan officer said, "Besides the fact that we know you are in control of your business -- those monthly statements -- we know you are honest." He said he knew that because they saw me depositing lots of cash, not hiding cash sales, even though mine was not a typical cash-based business. Be responsible and the money will flow. As Tweezerman grew, we began to get very large orders from the chain drug stores. Suddenly, I needed a quick and large cash infusion to make such a large opening order. Where did I find this money? It was right under my own roof. I took out an equity line on my house. My bank trusted me, so I had no problem getting the additional mortgage. My personal guarantee was on all the bank loans and the convertible notes. I always paid my interest on time or my notes when they became due -- even if I had to borrow from someone else to do it. In short, I was super responsible to those who backed my company. In the end, we all benefited from this positive character trait. You can't live without food and water. Likewise, you can't start or run a business without money. But it's a myth that you need a lot of money to launch your own business. What you do need is a good idea, the talent and drive to make it happen, and good character. Good character is the part that will help you raise money, establish essential relationships with your backers, and help you finance your dream. Read more about financing your business in my book Raising Eyebrows. A Failed Entrepreneur Finally Gets It Right.
Let's start with the fact that I own 5,000 shares of Google. Google makes 18% more money on 27% more sales the first quarter of 2011 than the first quarter of 2010 -- and Wall Street takes the value of the stock down $48! What happened to me is somewhat annoying because finally, I stopped trading the stock market. Instead, I'm running my own business and investing in businesses creating well-paying jobs. The money I put in the market is for holding stocks in companies I want to support -- not trade. Had I been trading and paying attention, I would not have missed that Google was announcing its earnings yesterday. I might have sold my position. Then, at the end of today I could have bought it back $48 lower -- trading. As I've said I'm not trading, I'm a good patriotic American helping to create jobs for the almost 15 million Americans still unemployed. Then I have to watch my Google stock drops $250,000 in one day. That's annoying. The main reason I am pissed is that Wall Street motivates job destruction rather than job creation. If Larry Page (co-founder and new CEO of Google) were the typical Fortune Five Hundred CEO, he would be laying off employees; his Board of Directors would be giving him a big bonus; Wall Street would be running up the value of Google's stock. Larry Page is hiring people -- over 6,000 people -- yet Wall Street runs down Google's stock 8%.
As chronicled in my book Raising Eyebrows, A Failed Entrepreneur Finally Gets It Right, from the beginning of Tweezerman, the company that became my big success, I was empowering my employees. My story included me being exploited by powerful men whose orbit I had fallen into. Rather than copying their behavior, I promised myself that I would do the opposite when I had employees. I'd empower rather than exploit them. Many employers underpay and/or overwork their employees and feel proud of how they can help increase the profits for themselves and other shareholders. I saw this as short-term gains at the expense of long-term rewards. I also saw my employees as more important than even the product I was selling. Initially my big delivery to employees at Tweezerman was health and job security. As soon as we had three employees, the number then required to get company health insurance, we got it. I instituted a policy where the last thing we did was fire someone. And no one person, including me, could fire a person without another employee of the company agreeing. You had to be drunk or drugged on the job, not show up, or get caught stealing to get fired. As we grew and more jobs were created, if you couldn't make it in your job we'd find another job for you to try. We had one woman whom we cycled through five jobs before discovering she was great at handling returns. Once in a while we rued this policy of not getting rid of incompetent employees quickly and directly, but generally the sense of job security for everyone was worth the occasional deadwood. One way companies exploit their employees is to pay them a salary and set an expectation that you have to work more than 40 hours a week to advance. With Tweezerman during the initial years I paid people by the hour. If you worked 45 hours you got paid for 45 hours. Eventually as we got big and top-level employees with bigger compensation arrived we did paid them salaries. However the laborers stayed on the hourly rate to ensure they were fairly compensated for the work they were doing. "Take care of your employees and they will take care of you" was one of my mantras. Caring about and for your employees is a necessary foundation for empowering them. Many employees have stressful home lives. It makes an enormous difference to their productivity if work is actually a haven away from their problems at home. What really has to happen for employees to be empowered is they need to be involved, given responsibility, and pushed to grow in their job. My sister Teri who worked with me for years used to say, "Dal sees in people what they themselves don't see." In other words I would throw people into a job that they might not feel qualified for. Usually I was right and they thrived and did a great job. When we hired people during the interview I'd find out what would be their dream job. If a job opened up that fit closer to their dream job I would offer it to them. We established a steering committee of the all the department heads and met twice a month. The committee was always comprised of an odd number of people so we were always able to make decisions. I considered them my partners and made that their reality. 5% of our profits were distributed to all employees, excluding me, in January after each year. We had a formula that was considered fair. The theory was what you earned working for the company is a fair measure of your worth to it. Each employee got a percentage of the total profits pool that was equal to what percentage their earnings were of all employee earnings. From day one I designed the capital structure of Tweezerman to reserve 20 percent of the stock to be owned by my employees. Half of that went to the top managers and the other half (10 percent of the stock) went into an ESOP (Employee Stock Ownership Plan) that involved all the other employees. As partial owners of the company I thought it critical that they understand how the numbers worked. I conducted company-wide meetings where I'd explain the profit and loss statement and our budgeting process. We also ran Quaker style meetings where everyone sat in a circle facing each other and anyone could take the floor and make a comment, deliver a complaint or compliment, or ask a question. I was very grateful my employees showed up for work every day and did things I didn't want to do. The way Tweezerman grew to a much bigger size than I was ever interested in being responsible for was because I delegated every operational job to someone else -- including President of the company. Probably a little sooner than she herself thought feasible I made one of my first employees, Lisa Bowen, President of Tweezerman. Because I had empowered my employees from the outset, twenty-five years later I owned a company that was dramatically bigger than I ever desired or dreamed. I sold it for much more money than I ever thought possible. My employees shared millions of dollars in capital gains and kept their jobs when I sold the company to the Zwilling J.A. Henckels AG in 2004. I continue to stay in touch with many of my employees and have close relationships with many of them to this day. For even more stories, like how we didn't lay anyone off after 9/11 and how that turned out, and more details about best practices of employee empowerment read my book Raising Eyebrows.
Since the uprisings in the Middle East and the Japanese earthquake, tsunami and nuclear crisis have pushed the problems of the American worker and the U.S. economy off the news, I feel compelled as someone who was deeply involved in the Iraq War to stake out my position on the actions in Libya. As I watched a ruthless and probably unbalanced leader using his military and mercenaries against his own people, my heart went out to the people of Libya. I believe that caring people everywhere should support an international effort to stop the bloodletting. I believe that President Obama has acted wisely in authorizing the current campaign of enforcing a no-fly zone in Libya. President Obama followed a deliberative process of considering the views of his military, Secretary Gates and Head of the Joint Chiefs Mullen, who were not in favor and his civilian leaders, notably Secretary of State Clinton, who were in favor. He waited until the United Nations acted and most importantly the Arab League supported action against Qaddafi. He selected a strategy which is designed to minimize both our military casualties and Libyan civilian casualties, and he is deferring leadership (at least on paper) to the Europeans. He has made it clear that we will not commit ground forces and will not create another quagmire. This strategy is of course not perfect and not guaranteed to succeed. But in this imperfect world it is the best course of action under the very difficult circumstances. It can be argued that no-fly zones have not been perfect solutions in the past because of civilian casualties in Iraq and the inability to stop ground-based atrocities in Bosnia. However, at least for the moment, we have stopped what appeared to be the eminent annihilation of the Libyan resistance. Some question why Libya and not Bahrain or Yemen and cite cynical reasons such as Libyan oil or friendly dictators vs unfriendly dictators. The real reason is much simpler: the world opinion is raised against Libya at the moment and we must act in concert with the rest of the world. Others question if this is truly a humanitarian effort and isn't at least in part an opportunistic move to put a whole lot of oil into more friendly hands. I cannot fully disagree with this sentiment but I also argue that the U.S. and Europe have a legitimate right to defend their interests. All this is not to say that a commitment of this magnitude should not be debated at the highest levels. Unfortunately, the sort of non-partisan debate which would best serve our country has not been forthcoming. The many Republicans who are running unannounced candidacies to replace Obama are for the most part criticizing Obama the person without presenting ideas or solutions. The Democrats can usually be counted on for a healthy debate on policy within their own ranks and Representative Dennis Kucinich has acted in that tradition in questioning the President's skirting of Congress in making his decision. However, Kucinich has made a serious mistake in bringing up impeachment. This suggestion is concerning and takes time away from what could and should be a serious policy debate. In this very uncertain time, we are fortunate to have a leader who has the patience to consider all alternatives, the credibility to build international support and the confidence to assert his policy. One wishes for an appropriate and speedy exit for Gaddafi saving us from him fulfilling his prophetic threat of fighting to his death. Written in collaboration with Frank Suttell and advice from Phyllis Bennis For more information about my work as a progressive activist go here.
Guantanamo is a situation created by Republicans, solutions for which are opposed by Republicans and used by Republicans as another unfair charge against Obama. The Bush administration used a piece of a foreign country from which the host nation has been trying to evict us for over half a century as a dumping ground for anyone suspected of posing a risk to the U.S. The fact that the Bush administration released over half of their detainees without charges attests to the cavalier attitude taken in imprisoning these people to begin with. The Bush administration simultaneously claimed that we were at war with the terrorists but that the prisoners of this war were not protected by the Geneva Convention. Because the prisoners were held out of the country and were not considered prisoners of war, the Bush administration declared themselves free from any standards of human decency and proceeded to torture the prisoners. The torture of the prisoners did not guarantee any valuable intelligence, but it did guarantee that the U.S. could not use any of their statements in any legitimate tribunal either against the tortured prisoner or against any other prisoner reported on by the tortured prisoner. The torture also guaranteed the enmity of the rest of the civilized world. When Bush's term was finally over, congressional Republicans and local Republican politicians took up the fight by refusing to support either detaining the prisoners on U.S. soil or trying them in U.S. civilian courts. To suggest that U.S. federal prisons were inadequate to the job of holding high-risk prisoners is ludicrous as is the notion that trying these accused terrorists in a civilian court is a threat to our centuries old judicial system. Under these impossible circumstances, Obama has none the less made progress in fulfilling his pledge to close Guantanamo. He has assigned a handful of prisoners to the few countries willing to take them. He cannot send the bulk of them back to their native countries because whether these prisoners were terrorists when they were imprisoned, a decade of incarceration and harsh interrogation has made many of them into terrorists. He has also established rules for military tribunals, which will uphold the American standards of justice, but that wasn't sufficient for some Republicans. And finally, after creating this tremendous stain on the reputation of our nation, the Republicans are criticizing Obama because he is not fixing their problem fast enough. This is another instance of the arsonists criticizing the fire department. Written in collaboration with Frank Suttell.
If you are wondering why the right to collective bargaining is so important for union workers here is a story about my father. My dad, Aldo, was a Longshoreman in Brooklyn from 1955 to 2001. In 1978 when the shippers wanted to containerize the docks they were going to save lot of money and a lot of union jobs were going to be lost. That is the way it would have gone down had it not been for my father's union, local 1814 of the International Longshoreman's Union (ILA). Led by Anthony Scotto the union organized bitter strikes and got a guarantee from the shippers that every man working gets 2080 hours of work a year (that's 40 hours a week) until they reached retirement age. Read Story. Before containerization it took 100 men a week of backbreaking work (e.g. carrying 100 pound bags of coffee beans off the ships). With the containers 45 men could do it over night. Instead of losing his job my dad got guaranteed paid till the day he would have normally retired whether he worked or not. One condition was that he had to shape up every day. In other words show up and report to be ready to work. What happened is that the guys with the least amount of seniority got called to work first. Because he'd been there for over 20 years he had AAA seniority. By ten AM if he wasn't needed - and he rarely was - he got to go home and still get paid for the days work. Till 10 AM he hung out playing cards with his pals in the shape up hall. After 10AM he went to the diner in Brooklyn to continue playing cards and to flirt with Emelia, a beautiful waitress, who ended up as my dad's late life girlfriend. What advantage then was containerization to the shippers if they still had to pay the workers for 40 hours a week? The ships got unloaded in one day rather than a week. Also there was no loss of products. Though a container here or there might disappear the content was pretty much safe locked up in the containers. Theft was a big loss item in the old days. This was a great example about how the right of collective bargaining caused productivity gains to get shared by the workers and the employers. Normally what happens is the employers get richer and the workers get no gains or worse, lose jobs. Also thanks to the union, wealth disparity was abated. Rather than the shippers making a lot more money because of the savings they only made more money while my father and his co-workers kept the income they had from their jobs. Over time as my father and his co-workers retired they were not replaced benefiting the shippers even more. Finally my dad gave or lent his kids all the money he made in his senior years from that guaranteed job and my siblings and I started our businesses, bought our houses, or send his grandchildren to school. While I'm on the subject of my father he said to me when I was running for President of the USA: "Always remember, it's the working man who is keeping this country where it is. Not the guy who has two billion dollars and is telling everyone what to do. Have a little patience and the working man will take care of himself and you." Read more from my father in my book Raising Eyebrows, A Failed Entrepreneur Finally Gets It Right. Yeah Unions!