Kerry talked with General Wesley Clark, founder and CEO of Wesley K Clark & Associates
Original Air Date 7/12/2017 - Replayed on 12/1/17, 11/6/2019, and 11/5/2021
During his 38 years of service in the United States Army, Wesley K. Clark rose to the rank of four-star general as NATO’s Supreme Allied Commander, Europe. Since retiring from the military in 2000, he has become an investment banker, businessman, commentator, author and teacher. In September 2003, he answered the call to stand as a Democratic candidate for President of the United States, where his campaign won the state of Oklahoma and launched him to national prominence before he returned to the private sector in February 2004. Clark has chaired several public and private companies, and is a progressive leader in pursuing energy solutions.
Clark graduated first in his class at West Point and completed degrees in philosophy, politics and economics at Oxford University as a Rhodes Scholar. While serving in Vietnam, he commanded an infantry company in combat, where he was severely wounded and evacuated home on a stretcher. He commanded at the battalion, brigade and division level, and served in a number of significant staff positions, including service as the Director Strategic Plans and Policy (J-5). Clark finished his career as NATO commander and Supreme Allied Commander Europe where he led NATO forces to victory in Operation Allied Force, saving 1.5 million Albanians from ethnic cleansing.
His awards include the Presidential Medal of Freedom, five Defense Distinguished Service Medals, silver star, bronze star, purple heart, honorary knighthoods from the British and Dutch governments, and numerous other awards from other governments, including award of Commander of the Legion of Honor (France).
Clark joined UCLA as a senior fellow at the Burkle Center for International Relations in UCLA’s International Institute in 2006, where he teaches seminars, publishes through the Burkle Center, and hosts an annual conference of government, corporate and opinion leaders from around the world on national security. He currently serves in leadership positions with a number of non-profit public service organizations, including City Year Little Rock/North Little Rock, the International Crisis Group, the Center for Strategic and International Studies, the Center for American Progress, the United States Institute of Peace, VoteVets, and the General Accountability Office. He also serves as a founding member of the Clinton Global Initiative’s Energy & Climate Change Advisory Board and ACORE’s Advisory Board.
Clark has written 4 books and also serves as Chairman/CEO of Wesley K. Clark & Associates, a strategic consulting firm, and Co-Chairman of Growth Energy. He founded Wesley K. Clark & Associates in 2004, which uses his expertise, relationships, and extensive international reputation and experience in the fields of energy, alternative energy, corporate and national security, logistics, aerospace and defense, and investment banking. He applies his experience and skills in strategic leadership, high technology, training and organizational development to the challenges facing the corporate world – offering a singularly informed and dynamic view of leadership based on honor, conviction and action.
Up In Your Business is a Radio Show by FlagandBanner.com
[0:00:03.2] TB: Welcome to Up in Your Business with Kerry McCoy. Be sure to stay tuned till the end of the show to hear how you can get a copy of this program and other helpful documents.
Now, it's time for Kerry McCoy to get all up in your business.
[INTERVIEW]
[0:00:18.8] KM: Thank you, Tim. I’m Kerry McCoy. Like Tim said, it’s time for me to get up in your business. For the next hour, my guest, retired four-star general, Wesley Clark and I will be getting up in the business of success, bravery and leadership. You’ll hear from the general tips on being successful, talk about his accomplished military life and learn what he’s up to now as the CEO of the Wesley K. Clark & Associates, an international consulting firm.
Through our storytelling, you will hear how we maneuvered the path of independence and leadership in pursuit of our dreams. We won’t be taking calls today, but we will be answering questions via emails during the breaks.
My business experience began over 40 years ago when I founded Arkansas Flag & Banner. During the last four decades Flag & Banner has grown and morphed from door-to-door sales, to telemarketing, to mail order and catalog sales, and now relies heavily on the internet. Each change in sales strategy required a change in the company thinking and procedures. My confidence, leadership knowledge and my company grew. My initial $400 investment now produces nearly four million in annual sales.
Each week on this show you’ll hear candid conversations between me and my guest about real world experiences on a variety of businesses and topics that I think you’ll find interesting. Running a business or an organization is like so many things. It takes persistence, perseverance and patience. I worked part-time jobs for nine years before Arkansas Flag & Banner grew enough to support just me. It’s not grown and expanded so much that to operate efficiently we require a purchasing, manufacturing, graphic, shipping, technology, accounting, marketing, sales and customer service department, plus a retail store. 25 people make their living from working at Arkansas Flag & Banner, now simply known as Flagandbanner.com.
Before we start I want to introduce the people at the table. We have Tim Bowen, our technician who’ll be managing the board and reading email. Say hello, Tim.
[0:02:20.6] TB: Hello, Tim.
[0:02:21.4] KM: My guest today needs no introduction. He is the well-known retired four-star general, General Wesley Clark. As a young man, Wesley’s ambitions showed as he used his intelligence and determination to graduate first in his class from West Point and became a Rhodes scholar at Oxford University in England. Clark served in Vietnam where he commanded an infantry company into combat and was severely wounded. He was evacuated home on a stretcher. He would later command at the battalion brigade and division levels. His army career also included serving as director of strategic plans and policy.
General Clark’s last command was as NATO and Supreme Allied Commander in Europe where he led NATO forces to victory in Operation Allied Force saving 1.5 million Albanians from ethnic cleansing. As you can imagine his awards are many. To name a few, they are; the Presidential Medal of Freedom, five defense distinguished service medals, Silver Star, Bronze Star, Purple Heart, Honorary Knighthoods from the British and Dutch Governments, and Commander of the Legion of Honor from France.
Since retiring from service, General Wesley Clark has worked in the private sector as a businessman, an investment banker, commentator, author, teacher and even answered the call in 2003 to stand as a democratic candidate for the President of the United States.
The next year in 2004, General Clark founded Wesley K. Clark & Associates, an international consulting firm where he uses his expertise, worldwide relationships, excellent reputation and experience in the field of energy, alternative energy, corporate security, national security, logistics, aerospace defense, and investment banking. All said business if performed with a General Wesley Clark ethos of honor, conviction and action.
It is an honor to welcome to the table, the brave, the intelligent, and honorable, retired but never resting four-star general, Wesley Clark.
[0:04:31.8] WC: Oh! Thanks, Kerry. Nice to be here.
[0:04:33.3] KM: You have such a big bio. I could have written more. Even though that was a lot, I was running out of breath —
[0:04:38.5] WC: Thanks for not doing it anymore.
[0:04:40.7] KM: You’re welcome. Thank you for coming on. We’ve been trying to get together for a while, but you’re always globetrotting, and it is a real honor for you to come on and share your wisdom. I had so much fun preparing your interview. You’ve done so much, seen so much, and are so knowledgeable on so many topics. If at any time you want to talk about something different or change the direction of my questions feel free.
From reading your bio, that begins at graduating first in your class from West Point. I gleaned that you always wanted to have a military life. Is that true?
[0:05:11.1] WC: I guess so. I don’t know exactly where it comes from, but my father who died when I was not quite four had been in the NAVY for a year in World War I. I had a picture of him as a NAVY ensign. He was from a Jewish family in Chicago and he was stationed in New York City and the family put him up on the Waldorf Astoria for a few months while they were waiting for the war to end.
I never really got the story of his military service, but I was growing up I always saw his picture. My stepfather, Victor Clark, took me out hunting and fishing from the time I was a little kid. I remember when I was seven year old, that was the first time I fired the .45 caliber pistol that my stepfather’s brother had used in World War I. All my friends’ parents had — They were veterans. My uncles Myles was a veteran of the Marine Corps at Okinawa. It was just a natural thing for people my age.
Of course, when I was growing up, there was a draft. If you didn’t go to college, you were likely — If you’re from Arkansas, you’re likely to be inducted. If you went to the University of Arkansas, if you were a man, you were going to be in ROTC for two years, because all land grant institutions had mandatory two-year ROTC.
[0:06:30.0] KM: I kind of wished they still did that.
[0:06:31.7] WC: I think there was something really important about feeling that you have an obligation to your country. I wish we could restore that today. I don’t know how to do it exactly. When I running for office, some people said, “You got to come out and favor the reinstitution of the draft. The truth is the Army doesn’t need to draft everybody who turned 18, and we wouldn’t know what to do with them if we had that many people and we couldn’t afford it and it just wouldn’t be the right thing.
If we could get some form of national service where every young person understands they have to give up their private room, their ability to party until 3 a.m., their iPhones on demand and so forth and really join in a community effort to help the country, help their community, help their state, it could be in the national forests, it could be in hospitals, or it could be abroad. It could be in the Armed Forced, but I think the country would be well-served if we could do this.
[0:07:31.3] KM: Do it right out of high school. Kind of between high school and college, right there where you’re young and you don’t have family yet and kind of learn responsibility and citizenship, because there’s too many children that are growing up today that don’t really have good role models.
[0:07:47.3] WC: I think it’s important to do it when you’re young and you can learn and you still got a lot of opportunities and choices in your life. I think as you get older in life, the range of freedom for choice, it just diminishes. You can’t do as many things when you’re in your 30s as you could in your 20s, you can’t in your 50s as when you were in your 40s.
[0:08:08.7] KM: But you can in your 60s, because I can do a lot more now.
[0:08:11.6] WC: It depends on the person, Kerry. People, they draw their own boxes around themselves and they limit themselves in ways they probably going to have to be. Yet in this society, there are role models, there are expectations of what people can do. In business, there’s typically been payment for longevity. Businesses are concerned about the cost of health insurance for employees. There’s a lot of factors in business that work against hiring older employees. I’ve talked to a lot of people who say, “Well, you know I was — In my company I was like 45, 48 years old.” I said, “We’re hiring somebody five years younger than you who’s going to be your boss.” You need to think about what you’re going to be doing in the future in this country.
You see these walls encroaching on people and —
[0:09:01.7] KM: Age discrimination.
[0:09:04.1] WC: To go back to the origin, is I think national service is a really important concept. I wish we could get it out there and make it so that people of different communities, different ethnic groups, different phase, different economic strata meet each other and respect each other.
One of the great things about the Army during the age of the draft is that we got a lot of high school graduates. We got a lot of college graduates and we got a lot of non-graduates, kids who could hardly read in the army and they all had to mix together, and these were people who would never have known each other. They would never have known about each other before, but it turns out that when you’re bonded together in an organization with a common purpose and you pull together and team work, you cross those boundaries of economics status and education. People, they’re mostly the same. If you give them a purpose to work together, they can do so.
[0:10:00.9] KM: You’re not talking about the draft. You’re talking about working together on civilian projects.
[0:10:04.8] WC: I think it starts with a purpose. It doesn’t have to be a military purpose. In fact, maybe it’s better if it isn’t, but it has to be a common purpose that brings an organization together and it has to involve some degree of personal sacrifice.
I was on CNN a few years ago and one of the young women who’s a producer said, “Oh! You had such great career.” I said, “You could too. How old are you?” She said, “24.” I said, “You could go into the Army.” She says, “Oh!” she said, “I could never give up my personal freedom.” It’s the way young people — It’s their expectations today and this makes it hard for them.
I was at Amherst a few years ago teaching a class on the volunteer force with an old friend from the military academy named Skip Bozovich who’s a professor up in Boston. Amherst is a very selective college. It’s probably the most selective college in America and these young people were very worried about the draft, about the fact there wasn’t one. The fact that all volunteer force, it wasn’t representative of America. There were too many poor people in it and not enough people of their class.
I went up there and I talked to them. I said, “Okay. Select 20 people in this class on a Friday and Saturday.” I said, “I want you to go home tonight. I want you to call your parents. I want you to tell them that General Clark is here and he promises that you can enlist for two years. He will guarantee an experience in a combat zone, probably Afghanistan, and you will be back in 24 months at Amherst. You will have done your duty to your country. You’ll be incredibly enriched by the experience and you will enrich the others because of your unique experience at Amherst. It will change your life all for the better. I want you to come in tomorrow morning and tell us about it and how many of you want to come in and we’ll have the recruiter here to sign you up.”
As you might imagine, not a one. The excuses were, “My mother said I … I … I … I’m not really … I’m not into guns and I would be better as a diplomat.” There’s like, “Well, you know my father or my father said this is not for us and he needs me in my business … His business.” There were dozens of excuses, but the point is it was really easy to pontificate about it and worry about it. It wasn’t easy for them to make an abrupt change in their life, and if it’s that hard when you’re 20, or 21, imagine as you go forward.
Something is important to bringing the nation together as a national service. Something as vital in delivering services to the country that you can’t afford to pay for under a government that’s increasingly resourced-constrained. Why wouldn’t we ask our young people to do this?
[0:12:52.3] KM: That’s very well said, and that’s a good point. I haven’t thought about it, resources constraint. Why don’t we use our young people? It would be so good for them, because I feel like my job is, all the time, teaching young people how to work.
[0:13:03.2] WC: It could be a great experience for them. Then there’s another group I liked too. Many of the problems abroad are problems to do with good governance, and good governance requires the rule of law and it requires financial management. Those are the two kind of essentials. You have to setup the rules. You have to have a system to interpret the rules, and then you have to follow them and spend money on the public good.
I’ve been in — I don’t know how many countries, talked to the heads of governments. They all complain, and yet when we try to provide assistance, it’s very hard. It’s very easy to get military assistance in. They’ll send the Special Forces over, we can train new guys how to march, give you some basic marksmanship training, give the uniforms, get a basic radio. Pretty soon you got a unit. We did this in Africa and we tried to help these countries for peace keeping purposes.
[0:13:54.5] KM: Management they don’t want.
[0:13:55.9] WC: What they really need is they need people who can be in their various ministries working and helping and supporting good governance. Now we’re talking about lawyers and accountants. We’re talking about people in their 40s, in the mid-career. People who want to take a break for a year or two. People who will serve in a more mature peace corps. People who are willing to learn a language. Work in a different environment [inaudible 0:14:23.0].
[0:14:22.4] KM: You want them to go to these countries?
[0:14:24.3] WC: I’d love it if they would, yeah.
[0:14:25.8] KM: What do you want them to do exactly?
[0:14:27.5] WC: I want them to assist and provide consulting services under the aegis of the United States government to help governments have what we have. They all say they want to have what we have in America. You can’t have it if you don’t have good governance. You got to have respect for the laws and you’ve got to have a way of managing the books.
[0:14:47.1] KM: You don’t want them to go over there in a private sector style. You want them to go over there and work with the government, mentoring the government and teaching them the skills of a management that we have.
[0:14:55.8] WC: That’s right. I want them invited by the host government and I want them to work at half pay.
[0:15:02.2] KM: Yeah. There you go.
[0:15:03.2] WC: Because the way it works whenever you go to these governments, they’re besieged by people who are looking for contracts, and everybody wants more money, “Well, I was making $100,000 a year at home, but if I’m going to live in Nigeria, I should be paid $300,000 a year.”
Pretty soon they ramp up the — It’s unaffordable and it sets them apart from the people they’re working with. Imagine, getting extra pay like that and being in with a bunch of civil servants who are being paid $3,000 a year. Would you be resented?
[0:15:36.5] KM: Yes.
[0:15:37.6] WC: I would think so. This is part of the problem is we don’t have always the right tools. We talk about how we’re trying to help other countries live better, but we show them how we live. They see it 24 hours a day in soap operas, on the TV. They see it on the 24-hour news cycle. They see it on any number through social media, through advertisements, through products, but they don’t really understand how to do it in their country.
When I talk to people in the Middle East and Africa, they’re always going to Europe. I say, “What’s the matter?” “It’s just not home.” I said, “Yes, but it’s so much easier in Europe.”
[0:16:16.1] KM: Why is it easier in Europe?
[0:16:17.6] WC: Everything works. If you want a driver’s license, you go and apply for a driver’s license. If there’s an issue with the medical, you go to the hospital. In different countries, the hospital is not there, the doctor doesn’t have what he needs. There’s a three-day wait for a driver’s license. You’d have to pay somebody. There are millions of issues that Americans take for granted because we do have good governance that people abroad look at and say, “It’s just so hard to get anything done. I want to start a business.” If you want to start a business in Arkansas, it’s easy. You go down and fill up some forms with the state secretary of state and you have an LLC and you pay $100 or something, you’re in business. It’s no big deal.
If you want to start a business in some countries, it’s 15 different stamps on forms and paying people and waiting in line.
[0:17:07.1] KM: You said Europe was easier in some respects.
[0:17:09.3] WC: I’m not talking about Europe. I’m talking about these other countries, because anywhere you see a line for anything, you can assume that line is a sign of corruption. It’s put in place because if you don’t want to stand in the back of the line, there’s a way to get in the front of the line really easy. You pay. You can call it buckshees, you can it la mordida, you can call it whatever you want, but good governance is rare, that’s why people want to come here. That’s what they believe in in the United States. They believe in a rule of law.
[0:17:44.5] KM: But barriers of entry are too hard.
[0:17:46.5] WC: The thing about it is the American business community is a very tough business community. You were talking about how long it took you to get your business started, and that was them. One of the things that has — I’ve been 17 years now in the private sector and one of the things you see is how difficult it is for young businesses to get started in the United States. The rate of small business formation today is half of what it was in the 1970s and people want to blame that on a lot of different things.
I was talking the other day to one of the chief editors of Inc. Magazine. I asked him the question, he said it’s not because of regulations. It’s really because of capital. It’s hard to get the money. In the old days, and when I was growing up here in Little Rock, I worked for Mr. [inaudible 0:18:30.7] and he had a little office down [inaudible 0:18:32.4] and I was one of his chart boys. When I was at junior high school, you could come in and make a dollar an hour by reading Barron’s Financial Weekly and you could chart the high, low and the close for each stock on a graph paper with a number 3 pencil, and if you did it well for two hours you got $2. I thought, “Man! This is pretty darn good. My mother makes $40 a week. If I could work 40 hours here,” but of course I realized soon I couldn’t do that for 40 hours. I just couldn’t do it. It wasn’t in me.
One of the things Mr. [inaudible 0:19:05.2] did was he and others, they were local investments. People invested in their local communities. Everything wasn’t nationalized. Everything wasn’t competing across the country. One of the things that’s happened is big companies have gotten much, much bigger and the people in these companies, they’re just like you and me. They love their families. They’re doing the best they can. They want to please the boss. They want to get promoted. They want their kids to do well in school, but the organizational output of these big companies, it’s very selfish. That is to say, they want what goods for them not what’s good for the larger community. You have to have a referee.
One of the things that’s happened in the United States is the refereeing hasn’t gone as well over the last 30 or 40 years as I would like to see it go. I would like to see the standards for mergers and acquisitions to be tightened up so that we slow down the movement towards oligopolies and monopolies. We make more space in the business community for smaller startup firms.
People will argue, “Well, for purposes of efficiency,” but it’s not about efficiency. It’s really about what’s good for the society as a whole because it turns out that when you have monopolies, you block innovation. You block young people getting started. Really, for the society as a whole it’s not more efficient. It’s less efficient. It just locks in certain businesses in practices. That’s one of the things that —
[0:20:33.4] KM: Can it ever be stopped? Teddy Roosevelt put an end on trust laws, but it doesn’t seem to be —
[0:20:37.6] WC: Oh, it worked really well for a while, but it takes political will to do this. The more money you have in politics, then the more difficult it is to do this.
[0:20:48.3] KM: The more money you get is from the lobbyist who have their own special interest, I guess.
[0:20:52.5] WC: The lobbyist are hard by the money to promote this special interest. Just like a guy told me once, he said, “You don’t make much money working for government,” but he said, “You can make a lot of money off government. I thought, “Oh! I hadn’t ever —” I was in the army, I was running around, I was a commander in chief for the U.S. Southern Command in Latin America. I went to all 33 countries of Latin America. I went to the Caribbean, I saw heads of state. I knew Carlos Menem. I’ve been with Pinochet, whatever you think of him, in Chile and lots of other people who were big personalities at the time and I always advocated to do our system. In Argentina, Carlos Menem became a hero in Latin America for pegging the Argentine Peso to the dollar, and our system looked really good.
Then when I was in Belgium, a women who was a holocaust survivor and Belgian businesswoman, she was very, very — She was in her 80s and she was experienced and very smart. She told me once, she said, “In America,” she said, “you have the best government that money can buy.” I said, “Uh —” It was one of those aha moments that you never really think about when you’re growing up. In 9th grade civics, they don’t really explain it to you, and so I began to look at the world of money.
It is important that people who have money have the right to use their money and express themselves. On the other hand, we believe in one person one vote and we believe that the community’s interest is special and important. It’s what it said — It says in the United States Constitution, to form a more perfect union for the common good. It doesn’t say to advance a couple of families to make billions of dollars.
[0:22:44.2] KM: 50 to be exact, I think.
[0:22:45.7] WC: How many it is, it doesn’t matter. The point is that somehow in this last 30 or 40 years we have, we’ve grown the economy tremendously but the distribution of wealth and income had become increasingly unequal, and that any quality causes problems. We don’t know how to change it. The only way to change it is to grow the economy, but you can’t grow the economy unless you’re willing to do some things. You have to be stronger in anti-trust enforcement. When I read merger and acquisition headlines on front page of the Wall Street Journal, it says, “Merger and acquisition.”
[0:23:25.6] KM: Another monopoly.
[0:23:27.1] WC: It’s like you’re supposed to be, “Hey! That’s great. Bankers are going to make a lot of money off that M&A activity,” but the truth is that people working in the companies will be — It’s what we call reorganization and it means you’re fired and go get another job. There’s an outplacement agent to help you, “Oh, let’s see. You’re 51 years old. You’ve been here. You know shipping. Thanks. Well, I’m sure there’s a job for you out there. Thanks. Next.”
These people — it is a pretty ruthless system. It really is about money.
[0:23:56.4] KM: You jumped way on down into my questing about —
[0:23:58.8] WC: What I want to talk about some of these things that will help the economy grow. You said I could talk —
[0:24:03.9] KM: Absolutely.
[0:24:05.6] WC: Anti-trust enforcement. Another one is what you call regulatory capture. In other words, when we setup — When Theodore Roosevelt and Woodrow Wilson, Franklin Roosevelt tried to establish a more fair and responsible business community that could work for the good of the country as a whole instead for just the giant trust, or the single families, like the Rockefeller’s and so forth, and this is all from over 100 years ago. They began to establish these regulatory agencies and they went on through the 1930s, really, and the depression when Roosevelt finished out the progressive movement.
If these regulatory agencies are staffed by people who must depend on the businesses and industries that they are regulating for their retirement and for their income security, then they can’t be as loyal to the public good as we would like. I don’t want to impugn the reputations and their good sense of all these servants, civil servants, because we have an excellent civil service program and some great people working in governments, but I think we have to remain very sensitive to the fact that if government pay lags behind private sector pay, if people feel like, “Well, I really like working for the government, but I got to put the kids in college and therefore — Let’s see, I really know the oil industry and therefore — Hmm — Oh! There’s a guy from Exxon. Well, I know if I retire I get out of here — I told my wife I would be getting out in my late 30s and she’s saying, “When are you getting out?” Joe, can we have coffee sometime?”
[0:25:44.1] KM: Oh, I see what you’re saying.
[0:25:45.8] WC: Before you know what he’s working as the Exxon or Shell or some other big industrial groups, experts on government relations and they’re using his experience and his role. Then the guys who are left behind say, “You know what? God! He’s working out there for four times what he made here. I could do that. How do I do that? That’s my safety net.”
In the military we never thought about that. We never considered what we would do when — At least I never did when I got out. It was just so all-encompassing to be on the inside. This regulatory capture, it’s important in the banking industry, it’s important in the environmental protection industry, agency, it’s all important all across the board in food and drug administration, everywhere. If you don’t have public servants who are smart enough, experienced enough and motivated enough to keep with the agencies, over the industries and the companies they’re regulating, you won’t have good sensible regulation. You’ll get lost in it and ultimately the public servers. That’s a second thing we have to work on.
[0:26:51.5] KM: What if they just made a rule where you couldn’t go work for the company you’re regulating?
[0:26:56.7] WC: They often do have rules like that, but they usually apply it only at the top and they only apply it for a year or two and they can be waived. Some of that in Washington today.
[0:27:06.6] KM: I don’t know how you’d ever regulate that. I have never ever thought about that.
[0:27:09.1] WC: The way it used to work out is, first of all, the discrepancies in salaries wasn’t so great. Secondly, people were really happy for a steady job. Third, businesses in those days, they weren’t so adept at calculating profit and loss down to the third decimal point. They didn’t have Excel spreadsheet. They didn’t have real-time accounting.
A modern store can tell you within 10 seconds of what’s been sold or what’s left in inventory, what’s been ordered today. How many people it needs or, really, what your income per square meter of floor space and income per employee. How could this company make $5,000? Wait a minute. Kerry, aren’t you in the retail business?
[0:27:55.6] KM: Yes.
[0:27:55.8] WC: You know exactly what I’m talking about.
[0:27:57.2] KM: Yeah. I’m laughing at you. Yeah.
[0:27:58.6] WC: You have to use metrics, okay? The thing about it is we got to always think in terms of what’s good for the country as the real driving, overarching, good for the community, not just what is good for the individual business. If you say what’s good for the business is good for the country, yes and no. Take the large view.
In the field of economics, I used to teach economics, we talk about stakeholders in businesses. We said businesses have the owners. They have workers. They have the managers. They have local community. All these, these are stakeholders. In the 19 — Late 70s, early 80s, there was a revolution in business management in America. It said it’s now not about stakeholder theory of value. It’s shareholder theory of value. Everything is about how well you do for the shareholder.
[0:28:47.8] KM: Not the people that work for you. Took the focus off the people that work for you.
[0:28:52.4] WC: Exactly. We really got in to this very narrowly. Of course, it does bring result. It’s like anything in life. If you really work for something, you can probably get it. If your principal concern is to elevate the value of a share on the New York Stock Exchange, you probably can do that at the sacrifice of other values.
It’s like when I was in one of my first business experiences, I was on a comp committee and we had done a limited buy out of two moving van companies. We put the two companies together and it turned out that they had what’s called defined benefit pension programs. These people who were doing manual labor, lifting, and driving and stuff, they knew that after 20 years of working for that company, they could retire at 40% or 50% of what their annual salary was.
Before the board meeting that day, the woman who was the human resources manager, the HR director, briefed the compensation committee that I was on and said, “We’re going to change this from defined benefit to defined contribution.” I said, “Doesn’t that mean like you’ll put in a certain amount, they’ll put in a certain amount. It goes in to the stock market. Then when they retire they can’t really know for sure how much they’re going to make, right?” She said, “That’s right.” I said, “What if the stock market is down?” She said, “That’s their risk.” I said, “In the military, if you did that to us in the military, we call that an erosion of benefits, because when we signed up you promised us this. It’s like our healthcare and everything and we’d go to congress.” She said, “General, if they don’t like what we’re doing, they can quit. There’re 10 people out there who want a job here for everyone working here.”
[0:30:28.1] KM: I hate that.
[0:30:30.0] WC: You might hate it, but she wasn’t wrong. There were people who would have worked there and business does do that and that was part of the wave of LBOs. You took these pension funds that were in a pot and you changed the way it was done. You might grandfather some people in there so there couldn’t be lawsuits. Basically, you got sort of pot of money that went along with doing the LBO, I guess.
You looked at these changes, you realize that the shareholder theory of value it’s a very narrow way to approach a company because it doesn’t incentivize the employees. It doesn’t really incentivize the community, and it doesn’t leave the best for the community.
There’s a place in Iowa that I was up there campaigning one time. I was at this community. They said, “Yeah, we gave these guy big tax break. The firm moved in. Two years later they moved out to Mexico and they left us stranded. We paid for all these, from the community, all these people had jobs. Now they’ve all lost their jobs and they moved because some CFO that came in said, “Oh, I know how to set up something in Mexico and I bet we can save money.”
Yeah, you say that’s legitimate. That’s why business is supposed to work.
[0:31:40.8] KM: It is. It’s not moral.
[0:31:41.6] WC: However, it doesn’t have to be that way. For example, I was on a board of a company in Germany and the Germans had a worker’s council and the Germans had laws. Yeah, you can fire people over there. No problem. You can close a business and move it. However, you’re going to pay three years wages and 10 years taxes. You have to evaluate the move. If it’s really that valuable you’ll do it. If it’s marginal, you won’t. The German economy actually has been really pretty dynamic. It’s not as bad as people think and it’s still leading the world in a lot of heavy manufacturing. There are different models and different ways to make these things work.
[0:32:20.2] KM: I just feel like our congress is paralyzed, sitting there paralyzed to get anything though. Those sound like big changes. They’re thinking big.
[0:32:29.5] WC: I think there’s a lot of great smart people in congress in both parties and they’re trying really hard, but congress has changed because it operates on the competitive basis. It goes back to the founding fathers, really, in the federalist papers which explains the U.S. Constitution and the 51st paper written by Alexander Hamilton and James Madison. They said, “The problem that happens to democracy is one small group takes control of the democracy and then it’s not a democracy anymore. It becomes like a monarchy.” This is what happened in Athens, this is what happened in Rome. Every time in history they try to set up democracy. Some group would take it over and then it would destroy the democracy. The solution is what became known as checks and balances. That is to say let ambition counteract ambition and let interest counteract interest.
In a way, what happens in our government is adversarial system. It’s labor’s interest against management. It’s the south against the north. It’s the east against the heartlands. There are various sectional interests, business interests, political interest that all are put up there and people are shuffling papers and trying to reach compromises. It doesn’t sound like a great system, but nobody’s come up with anything better so far. Where we are right now is that —
[0:33:49.5] KM: Rome? Are we Rome?
[0:33:51.4] WC: The thing that’s happened in the country is we got better economically during the 1960s and 70s and we moved from being worried about jobs, really, even though people say they are. They moved into values. The trouble with values as supposed to jobs is it’s really hard to compromise values. If one group is prolife and the other group is pro-choice, then what’s the compromise? There’s really no compromise.
You talk about rolling back this legislation and that legislation so forth, and the guns issues become a huge value issue in this country. It’s not about guns. Really, I’ve got plenty of guns at home. It’s really values and what you believe in in your heart. When politics becomes reduced, the values, then it’s much harder to move forward in a democracy. The struggles become much more intense, much more gut-wrenching, and the country is pretty much evenly divided in terms of public opinion on many of these value issues right now. It’s been this way for 30, 40 years. I saw it when I first came back from Vietnam and people had long hair. I thought, “What the heck? I got a crew cut and all these guys, they have long hair. What are they doing?”
We went through the sexual revolution, the civil rights revolution. We went through a big inflationary push and then a really tough economic period, rising oil prices in the 1970s. We came out at it with the Reagan Revolution and Reagan convinced Americans that government needed to shrink. That it was mostly about values. If it becomes that, then government looks like it’s deadlock. It’s really a pretty good process if you can move off the values issue, you get a lot done.
[0:35:44.2] KM: You’re a historian. I saw you head-to-head with Bill O’Reilly.
[0:35:49.5] WC: Yes, but that doesn’t make either one of us historians.
[0:35:53.3] KM: You are though. Both of you are. Do you believe history repeats itself?
[0:35:58.5] WC: No, but I do believe — They always joke, it doesn’t repeat itself, but it rhymes. Things happen. You can feel the forces working in a certain way.
[0:36:07.6] KM: What’s rhyming?
[0:36:08.3] WC: It moves in certain ways. When things get bad enough in terms of inequality in this country, people will respond to it. It will not be the next election cycle, it may be two, four, six election cycles now, or if the economy breaks. When the economy broke in 2008, we got the tea party. People were really mad when their retirements were threatened and were their home values went down.
The problem is that the solutions proposed by the tea party by enlarge haven’t really changed anything. They could be mad at Obamacare but it turns out that the people who were the most angry about it are the people who seemed to be getting the most benefit. It makes it very difficult to move past Obamacare for the United States government right now.
[0:36:54.6] KM: With all your globetrotting, and since we’re on the subject, what do you think the biggest threat to civilization is? War? Global warming? Greed? Global economy? Energy shortages? Water shortages? Propaganda? That’s one.
[0:37:07.3] WC: These are all — Let’s don’t about threats. I always look at is this way. There’s two parties, two political parties in America. There’s a party that is about fear and it gets it energy from worry, anxiety, fear, threats, and there’s a party that gets its energy from fairness and opportunity and challenges and it’s probably easier to get the power from fear if you can frighten people. Actually, we’re in a dark place right now in the United States and in the world. We’ve raised billions of people above the poverty level. We have un-parallel communications. For the first time, people can see that — If they look, that most people are mostly just like them, skin color, hair color, religious faith. Really, there’s not that much difference.
There’s a few nuts out there who want to take us back to the 7th century, but they’re not going to succeed at that. You’ve got people who, for their own political purposes, like Vladimir Putin, have tried to say something about nationalism and being white and being Christian and so forth, but it’s actually not as strong as what pulls us together, because when you put people together and they see each other and they talk to each other and they feel the same empathies and concerns, that’s the really wonderful thing about where we are in the 21st century. Right now, we can do that. I don’t think there’s going to be a great war. I don’t think there’s going to be an asteroid and hit the United States, or anywhere in the world. I don’t think the Yellowstone super volcano is going to erupt anytime soon and destroy most of the United States.
[0:38:54.9] KM: You don’t think California is going to fall off the —
[0:38:56.5] WC: I don’t think it’s going to fall off into the Pacific. I don’t think that the terrorists are going to succeed. I think climate change is a problem, but we have most of the technologies that we need to deal with it and the ones that we don’t have we can get. We have a challenge facing us, and the challenge is can mankind look to the future with confidence and hope rather than looking at their neighbors in fear. If you’re going to look to the future with confidence and hope then you look at the environment that’s around us and you say, “Okay. We can’t sustain this. You can’t continue to pump this much carbon in the atmosphere without some bad things happening.”
We won’t know the pace of it, the mathematics of how glaciers melt and how the sea warms, how fast the ocean is going to rise. All that stuff. It’s not solid. It’s just all estimates, but you do know that the climate is changing, not the weather, the climate, and that most of the change seems to be caused by economic development. It’s why our use of energy are expelling carbon, digging it up out of the ground, burning it and then throwing it into the atmosphere, probably going to get worst.
Can we really bring the leadership together on this country and around the world that we need to deal with this issue? That’s the challenge for mankind. In other words, the institutions that got us here were wonderful institutions. Think if we hadn’t discovered oil in the 19th century. Were we’d be? The whole 20th century is about oil.
[0:40:30.2] KM: We’d be using solar.
[0:40:31.3] WC: No. You wouldn’t have air travel, because you’ve got to have jet fuel. You wouldn’t have the ships, the automobile traffic. We didn’t have it. We couldn’t do it, and it gave us mobile liquid energy, but now there’s new technologies. Technology, generally, if you look for it, you’ll find it, just like we found a way to go over the moon. President Kennedy told us we’re going to get to the moon before the end of the decade of the 60s. We did, not because we knew how, but because we knew how to learn how to do it. We could do the same thing with our technology with climate change, but to do it we have to reform our institutions. People that work in coal fire power plants, I think we’re going to have to do other things with those coal fire power plants and those people have to do other things to be productive citizens.
[0:41:22.9] KM: Be retrained.
[0:41:23.5] WC: Well, they can be retrained. They can be reemployed in other ways. Nothing is going to happen overnight, but we need a plan to get there. We have to look beyond the quarterly earnings statements of major corporations even beyond Flag & Banner and really look at where the country is going. We have to put out a program.
One of the things that was really great that was done during the Bush administration was something called renewable fuel standard, and congress passed a law that said that every year the environmental protection agency would raise the volume of renewable fuel. They will be putting the nation’s fuel supply every year and through 15 years into the future, and every year they do that. Every year there’s a fight about it and the oil industry is one side. The ethanol industry is on the other, but the point is the law was out there, it set some targets and some benchmarks and we could do that all across the society. We don’t have to centrally plan it. We’re not communists. We’re not socialists. We’re free market people in this country, but give us some targets and let the market decide what people want and let the best entrepreneurs and the best innovators get us there.
What I see in the future is this great challenge of climate change that could be the transformative engine for world society.
[0:42:51.3] KM: Wow! Everybody I know that is a leader like you that makes a difference in the world is positive like that. They have really positive things to say like that. Is that why you started Wesley K. Clark & Associates, your international consulting firm, because everything you said for the last 45 minutes? Do you go around — I saw where you go into five continents. There’s only seven. I’m sure you’re not going in Antarctica. What’s the other continent you don’t go into?
[0:43:18.0] WC: I haven’t been much in South America, but I’ve done a little bit in South America.
[0:43:23.6] KM: Is that why you started your firm, so that you can take all these wisdom that you’ve given us today because you have this positive energy and you go around and you share your good news and you try to talk about technology and the future? Is that why you’re so motivated and energetic all the time?
[0:43:37.1] WC: I just had this wonderful gift given to me that I never expected in my whole life. I got out of the military, I didn’t know what I was going to do, and I came to Little Rock. I worked at Warren Stevens on the 25th floor of the Stevens building and Warren and Harry gave us a great welcome back into Little Rock, and Jack Stevens was still alive then and I was incredibly grateful for it. I didn’t really understand much about business, and I didn’t understand much about America, though I thought I did. I had been gone 39 years from Little Rock when I came back in 2001, and I had this incredible gift given to me of letting me run for office. I got to go to — In five months in that campaign I got to 30 states. I met the top people. I met the top people in business. I met the top academicians. I got to learn education and healthcare issues and economic issues from a perspective that very few people get to see it from. It was a tremendous education and it really aroused my intellectual curiosity.
I spent the last 13 years since I got out of that presidential campaign and just go deeper and deeper and just — I read dozens of books and talk to hundreds of people and I’m just trying to learn as much as I can and give back as much as I can.
[0:44:50.9] KM: You quit working for the Stevens, started your own company, and how do you find business? Is that through networking and your great reputation that you find business?
[0:44:59.9] WC: Usually, it’s just a combination of things. You can’t really name one thing. I have an investment banks. So I’m a licensed investment banker. We’re looking for — We usually like to do big projects. We’re trying to do this big project down in Pine Bluff. It would bring a lot of jobs into Arkansas, but we’ve got a big project in the former Soviet Republic of Georgia. We got another big project out in Monterey, California and we’re always looking for things like this that we can bring leadership and try to bring financing into.
[0:45:31.5] KM: What are you doing in Pine Bluff, or can you say?
[0:45:33.4] WC: This is a project to take Arkansas National Gas and chemically transform it into diesel and naphthyl, and if we can get it done it will produce the absolute purist, cleanest burning diesel, it’s called synthetic diesel. No particulates or anything. It will help Arkansas, because we get a lot of natural gas —
[0:45:54.8] KM: Is that fracking you’re talking about?
[0:45:56.4] WC: No. Fracking has been done. The gas is here. It’s bottled up in the ground. When it was fracked it was probably worth $6 or $8 a thousand cubic feet, and now the price, sometimes it’s under $3. We can take it and transform it into diesel, fuel everybody benefits. Get cleaner fuel. People who have the natural gas benefit, because they get a bump up at the valuation of the product that’s in the ground. America benefits, because we’re not importing oil from overseas, and it will be in Arkansas. A couple of thousand construction jobs, 200 or 300 permanent jobs, 200 megawatts of power put into the state, grid system. It will be a really great thing and it will be the biggest plant ever done in Arkansas if we can get them running for it.
[0:46:43.6] KM: Wow! Good luck. You’ve written four books.
[0:46:48.3] WC: Right.
[0:46:49.7] KM: They are — Let me see, Waging Modern War in 2001, Winning Modern War, A Time to Lead, Don’t Wait for the Next War. Why did you write those books?
[0:47:01.5] WC: First book I wrote was because what happened in Europe and in Kosovo was difficult for the American people to understand. It wasn’t on television that much. It was big in Europe, but it wasn’t big here, but it was really important what we were doing and what we stood for and how we did it. That was my experience as a general.
The second book was written in 2003 because I was trying to explain what I thought was the right way to handle the conflicts in Afghanistan and Iraq.
[0:47:34.0] KM: And that’s what you’re calling the modern war.
[0:47:35.3] WC: That’s called Winning Modern War. Of course, we haven’t won these wars yet. We also haven’t done some of the things I recommended. The third book, it was just a short autobiography, and the fourth book is where I was in 2013 or 14 in terms of learning about America and the world and I tried to lay out what I consider the major challenges for the United States and then how to respond to those challenges. It was a national, not a military strategy. Not a diplomatic strategy, but a national strategy.
[0:48:08.9] KM: All the things you’ve been talking about today. I think at the heart of all good leaders is an educator. After retiring from the army you lectured and taught on what subjects? You wrote your books, but you also lectured.
[0:48:19.4] WC: I talk about international affairs and I talk about history and I talk about the economy and talk about international legal matters. Pretty diverse.
[0:48:28.9] KM: Everything. I told everybody at the beginning of the show that we’d tell a war story. You’ve only got nine minutes, and I have swum with you. I want everybody to know you’re a really down to earth guy even though you sound you are extremely intelligent and you’ve done a lot, but you and I swum at just an average gym and you just swim with normal people. You’re very down to earth. How do you stay this so grounded?
[0:48:51.5] WC: Life’s exciting. There’s a lot going on, and you try to keep up with it. When I was getting out of the military I didn’t know what I was going to do and there’s a congresswoman, Ellen Tauscher, and she said, “I’ll tell you. Here’s what you should do. One-third of your time should be investment banking. One-third of your time should be speaking and lecturing and studying and one third of your time should be not for profit work.” I thought, “Yeah, why not?”
When you’ve been in the military for a long time you don’t really know what you’re going to do when you get out.
[0:49:28.1] KM: What civilian life is going to be like.
[0:49:29.3] WC: You think, “Well, I’ll just get a job and I’ll go work for Lucky Martin or something,” a big defense company. “I’ll show up at 7:30 in the morning, have a cup of coffee at the Coffee Pot. I’ll work hard at my desk all day. I’ll make my reports on time and I’ll help the boss.” No. It may work that way when you’re in your 20s or 30s, but after you’ve done what I’ve done, you can’t go backwards, so you have to create your own life and you have to — That’s what I tell all my friends who are retiring, “You got to create your life.”
You’ve done all these. People have given you all that. They gave you the structure. They gave you the education. They gave you experiences. Now, you go create it and then give it back to other people.
[0:50:11.4] KM: You are definitely doing that. Tell us a war story. You want to tell us about the scar on your back that I’ve seen at the swimming pool. First thing I said when I went up to you, I don’t remember this, but a couple of years ago, I said, “Please tell me you didn’t get that in a car wreck or I will be really disappointed.” You said, “No. I actually got shot.” Is that something you could share with us? What happened, or what you remember?
[0:50:31.5] WC: It’s a great story. It was the time of the Vietnam War when we were trying to keep the enemy from operating in large units and trying to keep them away from Vietnam. We had gone away from body counts and we weren’t doing big operations. We’re doing a lot of small patrols. I was out on a small patrol. We knew the enemy was in the area. We found the enemy. We’ve walked into this basecamp. When didn’t see it when the shooting started. I was the first guy shot and we had a little fire fight.
It lasted about 30 minutes. I was on the ground. I got hit four times, and so I had got hit in the hand, shoulder, the calf and the buttocks. I think the buttocks when I was crawling away and it was like the gun fight of O.K. Corral for about 10 or 15 minutes. A bunch of ordinary drafted Americans, half of them not high school graduates. None of them would have passed a Hall High School calculus class, and I called on them to come up and start firing and take up position. They charged into the fire and laid down and won the day and basically saved my life, and a helicopter came and flew me away.
[0:51:42.1] KM: You don’t think that’s a great story? That’s a great story about mankind. I also read that you commanded at the battalion brigade and division levels. I don’t even know what that means. What does that mean? Is that in Vietnam also?
[0:51:55.3] WC: No, but you go through a career and it’s progressive. You do well as company commander. I had three different companies to command and if you do well in relation to your peer group, then they give you the higher command eventually, and that was a battalion. That have five companies in it. If you do well as a battalion commander, then you could get a brigade which has three to five battalions in it. If you do well as a brigade commander, they could give you a division, which has five to seven brigades in it. This is a progressive move up and everything is demonstrated performance. It’s the way any good organization operates.
[0:52:33.5] KM: Your last command was as the NATO commander and Supreme Allied Commander in Europe where you led NATO forces to victory in Operation Allied Force saving 1.5 million Albanians from ethnic cleansing. You’ve got some great karma. Tell us about that.
[0:52:50.3] WC: What happened was we negotiated a peace treaty, a peace agreement to stop the fighting in Bosnia, but Milosevic was also cracking down on his ethnic Albanian population a couple of hundred miles away in Kosovo. These Albanians, they didn’t want to be cracked down on. He told them they couldn’t educate kids in their own language. If you’re an Albanian, you couldn’t be a doctor. You couldn’t be a member of the government. You couldn’t issue driver’s license.
You just ran them out, basically. It was like a takeover of the government by a minority. They stood up and fought and he responded with military action against the civilian population. I flew down and tried to — On three occasions, I went down and negotiate with him and tried to explain to him. I sit with his generals. Sat around a map explaining to the Serb generals, “You can’t do this. Basically, you put military force against people?” I’m from Arkansas. I grew up with guns. I know people don’t like to be pushed around. People have self-respect. You put a bunch of yahoos down there in uniform pushing around these people. They’re going to fight back. You got to get them on your side.
The Serbs didn’t believe it. They believe they could intimidate the population, take the educators, the doctors, the lawyers, the human rights workers, anybody at resistance, they’d take them out, shoot them or dump the body down the mine shafts or whatever. They did this for a couple of years and the population rose up in revolt.
NATO had said to Milosevic he couldn’t do it and if he tried to do it, we would take military action against them. We did this in an effort to stop him from doing it, but when he started we took the military action. We did a bombing campaign against him with escalated tax and we also prepared a ground force or planned to do a ground force invasion if he didn’t stop. After 87 days of steadily escalating strikes against his resource base and his capital and his communications and so forth, Milosevic realized he was on the losing side and Milosevic, the Serb dictator, he was a very rational guy. He spoke English. I knew him. I’m probably the only 20th century commander who really knew his principle adversary and we knew how to break his spirit and take his will away and we did. We sent a tomahawk missile into his house, which was used a command center and had a bunch of antennas on it, people cheered.
[0:55:24.3] KM: I’m cheering.
[0:55:25.8] WC: Yeah. We didn’t kill him, and I was happy, but we did really symbolically takedown the regime. After 78 days we negotiated an agreement that they pulled all their forces back and a million and a half Albanians came out of the force and came back from neighboring countries to their homes. Today, Kosovo is an independent country.
[0:55:45.5] KM: I love it.
[0:55:46.5] WC: It didn’t have to work out that way. Generally, we don’t like to create new countries.
[0:55:52.2] KM: When your ego is too big.
[0:55:53.4] WC: You couldn’t do anything. These people, they were so hardheaded that they just couldn’t live together after so many relatives had been killed. The thing I learned, and I know we’re running out of time, Kerry.
[0:56:05.3] KM: Yeah, we are.
[0:56:06.0] WC: I learned is don’t use the military unless you have absolutely no other way, because military is about breaking things and killing people, and when you kill people, their relatives, they don’t forget and forgive. They’ll hold grudges for a long time. People in Arkansas, we know that. We went through the Civil War down here, and when I was a little boy growing up, there were still confederate soldiers alive and people were kind of quiet about it, but grudges last a long time, and don’t do that as a nation if you can avoid it. That’s the most fundamental lesson I learned.
[0:56:45.7] KM: That’s a great one to end on. General, it’s just been an honor to have you on today. I have so many more questions for you. Will you come back?
[0:56:54.6] WC: Yes, I would.
[0:56:55.3] KM: I got it on tape. I want everybody to know that. I usually give a cigar, because my guest, for birthing a business, which you did, but I think actually since I’m in the business of flags, I want to give you a desk set with a four-star general, the army flag and the U.S. flag. Do you have one?
[0:57:12.3] WC: No I don’t. It’s very nice.
[0:57:13.6] KM: You’re welcome. I hope you enjoy it.
[0:57:16.2] WC: Thank you very much.
[0:57:16.6] KM: You’re welcome. Thank you for sharing all your experience and your wisdom. Who’s my guest next week, Tim?
[0:57:21.4] TB: It’s going to be Sammy from Start of India.
[0:57:24.3] KM: Oh! He’s got a great story. To the people that wanted to hear about Connie Fails, we are working on a new schedule for her. She’s the clothing designer for the First Lady, Hilary Clinton, the founder of the fashion Design Scholarship Competition and manager of the Clinton Store in the Clinton Presidential Library in downtown Little Rock, Arkansas. We’re going to reschedule her probably in September.
If you have a great entrepreneurial story you would like to share, I’d love to hear from you. Send a brief bio and your contact info to questions@upyourbusines.org and someone will be in touch. Finally, to our listeners, thank you for spending time with me and my guest. If you think this program has been about you, you’re right, but it’s also been for me. Thank you for letting me fulfill my destiny. My hope today is that you’ve heard or learned something that’s been inspiring or enlightening and that it, whatever it is, will help you up your business, your independence, or your life. I’m Kerry McCoy and I’ll see you next time on Up In Your Business. Until then, be brave and keep it up.
[END OF INTERVIEW]
[0:58:23.4] TB: You’ve been listening to Up in Your Business with Kerry McCoy. Want to hear today’s program again or want someone else to benefit from it? Jot this down. Within 48 hours the podcast will be available at flagandbanner.com. Click the tab labeled “Radio Show”, there you’ll find today’s segments with links to resources you heard discussed on this program. Kerry’s goal: to help you live the American Dream.
