Monthly Archives: December 2016

The Mystery of the Xmas Hess Truck

Growing up, Christmas was always an amazing time of year for so many reasons. We weren’t wealthy but we were certainly blessed — there were always plenty of gifts and parties. And the gatherings were always punctuated by some airing of grievances (yes, Festivus) usually correlating with the partaking of a little too much holiday cheer. Ultimately, without failure, one clan or another, would end up abruptly leaving our grandparent’s Xmas get together in tears over some slight. “Get in the car kids, we’re leaving!” was a familiar holiday refrain. The drama was real, but it always passed quickly (usually by the time we got home) and it was part of our annual ritual.  I loved it.

One of our other traditions was the Kiwanis Club Christmas party. For a number of years, my Grandfather would take me, my siblings and cousins to their annual Christmas banquet. We would put on our Sunday best, pile in his cavernous, cold-leather clad Lincoln, with an admonishment from our parents to “behave your grandfather, or else,” and head to the palatial HoJo’s in East Greenbush where we would get a gift from Santa and order anything we wanted to eat off the menu.  (I loved the fried clam plate.)

My grandfather was the grand poohbah of the Kiwanis Club for a while, which made our attendance all the more intriguing and in a way, regal. We were at the height of East Greenbush society. Which is why it was always so baffling to me that every year Santa gave us a Hess truck.

Now, I know the Hess truck has become something of a collectible over the years, but I never quite got why it was (or is) a gift for kids.

I wondered, “What fun is it to play gassing up the local Hess station?”  What was my grandfather thinking, let alone those people at Hess!

Hence, the mystery of the Xmas Hess Truck.

As a nerdy and somewhat inquisitive kid, I thought long and hard about this perplexing issue.

After much deliberation, I surmised that it was an easy gift to pickup. After all, there were a lot of Hess stations in our neck of the woods, and back in the day, when people outside of New Jersey had their gas pumped for them, you actually could multi-task. So, I imagined that my busy grandfather had a few minutes to run inside and grab a bunch of pre-wrapped Hess trucks. Pre-wrapped was also key.

My grandfather owned his own plumbing – contracting business and was always working so I thought it was cool that he took even a few minutes to grab us a gift. And from a guy who lovingly referred to us grandkids as “boobs,” “jackasses,”  “morons” and “maroons” it was actually quite a statement of affection.

That explained “the how we came to have the Hess truck,  but not the why.”

I didn’t know for sure, but I had my theories. My grandfather, grew up very poor and hard. While he had a great sense of humor, he wasn’t exactly the warm, fuzzy type and I could never imagine him playing with toys. The only other “toys” I remember getting from him was a hatchet and lawn jarts – which should give you the picture. So I always thought, maybe a gas tanker is as close to his idea of a toy that he would ever appreciate.

Maybe…but over time I developed an alternate theory. The Hess tanker was also oddly reminiscent of what we called the “honey wagon.” If you’ve ever had your septic tank pumped out, you know what I’m talking about. With its huge tank, long detachable hoses and backup warning dinger, the Hess truck was as close to a fancy plumbers toy you could buy. Just imagine the number of septics you could service before you had to pump out the truck – it had to be a plumbers dream.

But yet I still wondered: no matter how much you love your work, “what fun is it to play pumping out a septic tank?” 

Since none us went into the family plumbing business, I guess you have the answer. Not so much.

The truth is, like all boy toys, the Hess truck was most often deployed as weapon. It was a huge flame thrower — torching dinosaurs, cowboys, indians and little green army guys every holiday season.  Or in keeping with the Xmas spirit, we would drive it into the enemy Lego stronghold clearing the path for invasion. Never once do I recall refilling the local Playschool service station or for that matter pumping out a full septic tank at a Lincoln Log house.

The allure of the Hess truck remains a daunting mystery to me. Yet, it always makes me smile and think of my grandfather and Xmas past.

Ho Ho Ho – Merry Christmas.

 

 

 

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A Story Begging for a Trump Tweet.

One of the refreshing things about Donald Trump is that he calls bullshit. He doesn’t get bogged down in the minutiae of why the world works a certain way – he just sometimes tells it like it is. Which is why I think if he heard Mike Gaetani’s plight we would see a Trump twitter storm.

Mike Gaetani turned 100 years old a few months back. He’s quite a story, an American story. Orphaned as a baby, Mike was passed around through some tough foster homes in the Boston area and never had a chance to finish high school. Yet he got a job, a good manufacturing job working for Johnson Controls, married the woman of his dreams, owned a home, had a child and scrimped, saved and prepared for a retirement he was firmly convinced only his wife would live to enjoy.

And his planning worked – as a 30 plus year employee of Johnson Controls (JCI) he steadily earned and bought shares in the company he made his career with. Over the years, JCI has been a rock solid stock, paying dividends that allowed Mike to stay off Medicaid, out of a nursing home and connected with his family. He did everything right, he got a little lucky – he was set, or at least he thought so.

At 100, Mike has congestive heart failure, “CHF” as he calls it, which if you are lucky enough to get to 100, most people have. But as faulty as Mike’s heart is – he has one – a big one, which is a lot more than we can say for the executives at Johnson Controls and Tyco that just completed one of the more despicable tax inversion details in history.  

A tax inversion is when an American company combines with a foreign company, typically moving it’s headquarters offshore, to escape our ridiculously uncompetitive federal corporate tax rate. Many see tax inversions as a gimmick for U.S. companies to boost their profits without actually improving business operations.

It was a hot topic during the Presidential campaign and earlier this year the Treasury Department actually issued rules that killed several pending tax inversion deals. Unfortunately, for Mike and the other 20% minority of JCI shareholders, one large inversion that wasn’t killed was a $16 billion deal involving the acquisition of Tyco, based in Ireland, by Milwaukee based Johnson Controls.

Why is it unfortunate? It seems that under federal law when a tax inversion deal closes, shareholders of the company inverting to the overseas tax location, JCI in this case, are hit with a tax bill as if they sold their stock. As such, the inversion is forcing thousands of JCI shareholders to dig into their pockets and pay taxes (essentially capital gains) on their unrealized gains just to remain shareholders.

Ok, that’s tough enough to swallow for Mike and other JCI retirees who acquired the stock at a low price over the years and are living off the dividends. But this inversion has a particularly pernicious wrinkle, in that the acquisition of Tyco was structured in such a way so that only 20% of all JCI shareholders are footing the entire tax bill for the inversion. That’s right 20% of JCI shareholders are responsible for 100% of JCI’s exit tax from America.  

You can guess which 20% of shareholders are footing the bill.  It’s not institutional investors, it’s not JCI corporate officers, it’s not the hedge funds – it’s the little guy, retirees like Mike.  

So I was hoping this story, obnoxious and true, might incite a Twitter storm from our President Elect. But alas, I realize with so many other things to tweet about it’s admittedly a long shot. Barring that – I’ll just generate some fake news and with any luck my bogus tweet will be treated as real and result in shining some light on this sad scam.

(Special thanks to the Donald Trump tweet generator)

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God’s Work

God’s work is being announced today in Indianapolis, but we’ll get back to that.

In 1994, when George Pataki became Governor, IBM was poised to move their corporate headquarters out of New York, no not to Mexico, but about 200 yards down the road on the same piece of property, just in Connecticut.  He called then CEO Lou Gerstner and asked him just to “give him a chance” and he would get the state moving in the right direction. Gerstner gave him a chance and IBM and New York would go on to have a very beneficial relationship…the most obvious outgrowth for those in the Capital Region is sitting at the corner of Washington Avenue and Fuller Road, today we call it SUNY Poly.

It was the right thing to do then and what President Elect Trump did with United Technologies is right too.  Leadership matters. Policy matters. I can imagine Trump had a similar conversation with Chairman & CEO Greg Hayes – just gimme a chance.  Kudos for UTC and Hayes for giving him that opportunity.

It’s important for a lot of reasons.  First, on the campaign trail Trump promised to keep these jobs in America…as a politician, as President keeping your promises matter. This was a good one to keep. Second, he sent a message to the business community and he didn’t use 140 characters to do it — he did it the right way.  Third, and most importantly, he saved close to 1000 good paying jobs.

Cynics will say he didn’t solve anything.  They will conflate decades long statistics on the steady loss of manufacturing jobs and say he doesn’t have a chance to reverse the trend. I believe the cynics are wrong on all counts. America’s energy revolution, coupled with rising wages in China, Mexico etc plus US technology / workforce superiority and a nexus to the North American consumer market are ingredients for growth in US manufacturing. Not a revolution – but real growth. The bigger problem is automation, which is constantly reducing labor needs.

But even if I’m wrong about everything – the cynics still are wrong too. I spent a good part of my career at Empire State Development chasing companies, cajoling, incenting, begging doing whatever it took to get them to stay in New York, because I knew it mattered. Not because of some donor, or the largesse of a big corporation (sorry Jim Heaney and my friend Richard Brodsky) and not because of politics (jobs were good press no matter where they were created) – but because it meant someone kept their job, someone could get a job.  A family had a better Christmas, a small town kept its anchor – a mother put dinner on the table and a father had pride and self-worth.

My father was lucky, he was always managed to stay one step ahead – every company he worked for closed within a year after he had moved on. And my mother, a single mom for many years, put aside her dreams and worked whatever job she could to provide for four kids. Through their example they taught us the value of hard work. There is nothing esoteric about that – a story repeated countless times throughout American homes. A story in danger of becoming an urban legend in certain parts of our country. Economic development isn’t always about solving every grand social, political or fiscal issue – pile up the wins, one by one, (bird by bird as Anne Lamont would say) and they matter.

Every job matters.  I treated it that way and believed in it with jihadi fervor and I still do.  And I was proud to work with a bunch of tremendous professionals at Empire State Development who by and large share that same passion.

Which is what brings us back to God’s work.  A few year’s back Lloyd Blankfein, Chairman of Goldman Sachs, was asked what sprung to mind when he thought of Goldman’s mission…he said “I’m doing God’s work.” He added, “We help companies to grow by helping them to raise capital. Companies that grow create wealth. This, in turn, allows people to have jobs that create more growth and more wealth. It’s a virtuous cycle.”

In the wake of the financial disaster – widespread scorn was heaped on Blankfein. In the department of bad timing, he should have been smarter, but I kinda got it (because I read the whole quote) and because I had said the same thing myself on many occasions.  Saving jobs, creating jobs and wealth is about more than the numbers, more than any policy – it is essential to keeping alive the American Dream, rhetorically and in reality.

Trump with UTC saved some jobs in Indiana today and as far as I’m concerned – that’s God’s work.

 

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