Go Back  DVD Talk Forum > General Discussions > Other Talk > Religion, Politics and World Events
Reload this Page >

"If we tried to start Home Depot today, it would never have gotten off the ground."

Religion, Politics and World Events They make great dinner conversation, don't you think? plus Political Film

"If we tried to start Home Depot today, it would never have gotten off the ground."

Old 10-16-10, 09:37 AM
  #1  
Political Exile
Thread Starter
 
grundle's Avatar
 
Join Date: Jun 2005
Posts: 16,322
"If we tried to start Home Depot today, it would never have gotten off the ground."

Wow!

I really agree with the bolded parts here.

While Obama likes to talk about "spreading" the wealth, this writer is concerned with creating wealth.

I doubt that Obama will ever read this. And even if he did read it, I doubt that he would learn anything from it.

But I sure enjoyed reading it.


http://online.wsj.com/article/SB1000...MoreIn_Opinion

OCTOBER 15, 2010

Stop Bashing Business, Mr. President

If we tried to start The Home Depot today, it's a stone cold certainty that it would never have gotten off the ground.


By KEN LANGONE

Although I was glad that you answered a question of mine at the Sept. 20 town-hall meeting you hosted in Washington, D.C., Mr. President, I must say that the event seemed more like a lecture than a dialogue. For more than two years the country has listened to your sharp rhetoric about how American businesses are short-changing workers, fleecing customers, cheating borrowers, and generally "driving the economy into a ditch," to borrow your oft-repeated phrase.

My question to you was why, during a time when investment and dynamism are so critical to our country, was it necessary to vilify the very people who deliver that growth?

Instead of offering a straight answer, you informed me that I was part of a "reckless" group that had made "bad decisions" and now required your guidance, if only I'd stop "resisting" it.


I'm sure that kind of argument draws cheers from the partisan faithful. But to my ears it sounded patronizing. Of course, one of the chief conceits of centralized economic planning is that the planners know better than everybody else.

But there's a much deeper problem than whether I am personally irked or not. Your insistence that your policies are necessary and beneficial to business is utterly at odds with what you and your administration are saying elsewhere. You pick a fight with the U.S. Chamber of Commerce, accusing it of using foreign money to influence congressional elections, something the chamber adamantly denies. Your U.S. attorney in New York, Preet Bahrara, compares investment firms to Mexican drug cartels and says he wants the power to wiretap Wall Street when he sees fit. And you drew guffaws of approving laughter with your car-wreck metaphor, recently telling a crowd that those who differ with your approach are "standing up on the road, sipping a Slurpee" while you are "shoving" and "sweating" to fix the broken-down jalopy of state.

That short-sighted wavering—between condescending encouragement one day and hostile disparagement the next—creates uncertainty that, as any investor could tell you, causes economic paralysis. That's because no one can tell what to expect next.

A little more than 30 years ago, Bernie Marcus, Arthur Blank, Pat Farrah and I got together and founded The Home Depot. Our dream was to create (memo to DNC activists: that's build, not take or coerce) a new kind of home-improvement center catering to do-it-yourselfers. The concept was to have a wide assortment, a high level of service, and the lowest pricing possible.

We opened the front door in 1979, also a time of severe economic slowdown. Yet today, Home Depot is staffed by more than 325,000 dedicated, well-trained, and highly motivated people offering outstanding service and knowledge to millions of consumers.

If we tried to start Home Depot today, under the kind of onerous regulatory controls that you have advocated, it's a stone cold certainty that our business would never get off the ground, much less thrive. Rules against providing stock options would have prevented us from incentivizing worthy employees in the start-up phase—never mind the incredibly high cost of regulatory compliance overall and mandatory health insurance. Still worse are the ever-rapacious trial lawyers.


Meantime, you seem obsessed with repealing tax cuts for "millionaires and billionaires." Contrary to what you might assume, I didn't start with any advantages and neither did most of the successful people I know. I am the grandson of immigrants who came to this country seeking basic economic and personal liberty. My parents worked tirelessly to build on that opportunity. My first job was as a day laborer on the construction of the Long Island Expressway more than 50 years ago. The wealth that was created by my investments wasn't put into a giant swimming pool as so many elected demagogues seem to imagine. Instead it benefitted our employees, their families and our community at large.

I stand behind no one in my enthusiasm and dedication to improving our society and especially our health care. It's worth adding that it makes little sense to send Treasury checks to high net-worth people in the form of Social Security. That includes you, me and scores of members of Congress. Why not cut through that red tape, Mr. President, and apply a basic means test to that program? Just make sure that money actually reduces federal spending and isn't simply shifted elsewhere. I guarantee you that many millionaires and billionaires will gladly forego it—as my wife and I already do when we forward those checks each month to charity.

It's not too late to include the voices of experienced business people in your efforts, small business owners in particular. Americans would be right to wonder why you haven't already.

Mr. Langone, a former director of the New York Stock Exchange and co-founder of Home Depot, is chairman of Invemed Associates.
grundle is offline  
Old 10-16-10, 10:28 AM
  #2  
DVD Talk God
 
Join Date: Feb 2000
Location: Directionally Challenged (for DirecTV)
Posts: 122,915
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Mr. Langone, a former director of the New York Stock Exchange and co-founder of Home Depot, is chairman of Invemed Associates.
....and Bucknell University's most generous benefactor.
Red Dog is offline  
Old 10-16-10, 10:31 AM
  #3  
DVD Talk Hero
 
Th0r S1mpson's Avatar
 
Join Date: Apr 1999
Location: Seattle, WA
Posts: 36,443
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

What's he whining about? If Obama tried to start his campaign today it would have never gotten off the ground, either.
Th0r S1mpson is offline  
Old 10-16-10, 10:33 AM
  #4  
DVD Talk God
 
Join Date: Feb 2000
Location: Directionally Challenged (for DirecTV)
Posts: 122,915
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by Thor Simpson View Post
What's he whining about? If Obama tried to start his campaign today it would have never gotten off the ground, either.
Red Dog is offline  
Old 10-16-10, 10:38 AM
  #5  
DVD Talk Hero
 
jfoobar's Avatar
 
Join Date: Jun 2000
Posts: 37,812
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Wait, Obama has been characterizing business owners and entrepreneurs as a whole as "reckless" and prone to making "bad decisions?" Seriously, has he?
jfoobar is offline  
Old 10-16-10, 10:52 AM
  #6  
Moderator
 
wendersfan's Avatar
 
Join Date: Jun 2002
Location: Nuova Repubblica di Salò
Posts: 32,854
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Yeah, because that whole financial meltdown a couple of years ago was caused by magic pixie dust.
wendersfan is online now  
Old 10-16-10, 11:06 AM
  #7  
DVD Talk Hero
 
jfoobar's Avatar
 
Join Date: Jun 2000
Posts: 37,812
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by wendersfan View Post
Yeah, because that whole financial meltdown a couple of years ago was caused by magic pixie dust.
You might want to reread what I wrote.
jfoobar is offline  
Old 10-16-10, 11:27 AM
  #8  
DVD Talk Legend
 
Vibiana's Avatar
 
Join Date: Jan 2006
Location: Living in a van down by the river
Posts: 13,882
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by Thor Simpson View Post
What's he whining about? If Obama tried to start his campaign today it would have never gotten off the ground, either.
Thor for the win!
Vibiana is offline  
Old 10-16-10, 12:00 PM
  #9  
Moderator
 
wendersfan's Avatar
 
Join Date: Jun 2002
Location: Nuova Repubblica di Salò
Posts: 32,854
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by jfoobar View Post
You might want to reread what I wrote.
I wasn't replying to your post, but to this thread in general.

(I know how to use the quote feature.)
wendersfan is online now  
Old 10-16-10, 12:20 PM
  #10  
DVD Talk Hero
 
jfoobar's Avatar
 
Join Date: Jun 2000
Posts: 37,812
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by wendersfan View Post
I wasn't replying to your post, but to this thread in general.

(I know how to use the quote feature.)
Fair enough. My mistake.
jfoobar is offline  
Old 10-16-10, 12:23 PM
  #11  
DVD Talk Legend
 
Join Date: Jul 2001
Posts: 11,747
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by wendersfan View Post
Yeah, because that whole financial meltdown a couple of years ago was caused by magic pixie dust.
It was caused by greedy poor people!
dork is offline  
Old 10-16-10, 12:45 PM
  #12  
DVD Talk Hero
 
JasonF's Avatar
 
Join Date: Jul 2001
Location: Washington, DC
Posts: 39,520
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

I think Langone is right. If we really cared about prosperity, we would return to the tax structure and regulatory regime that we had in the late 70s when he started Home Depot.
JasonF is online now  
Old 10-16-10, 12:46 PM
  #13  
DVD Talk Legend
 
Join Date: Aug 1999
Location: Lower Gum Curve
Posts: 19,044
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

I'm sure there are thousands of (former) local lumber yard owners and employees who wish langone had never started home depot.
Jason is offline  
Old 10-16-10, 01:06 PM
  #14  
Political Exile
Thread Starter
 
grundle's Avatar
 
Join Date: Jun 2005
Posts: 16,322
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by JasonF View Post
I think Langone is right. If we really cared about prosperity, we would return to the tax structure and regulatory regime that we had in the late 70s when he started Home Depot.
Hmm. That is an excellent point that you raise. The top federal income tax rate was 70% at the time.

But as far as regulations are concerned, the federal registry gets bigger every year, not smaller.
grundle is offline  
Old 10-16-10, 01:09 PM
  #15  
DVD Talk God
 
Join Date: Feb 2000
Location: Directionally Challenged (for DirecTV)
Posts: 122,915
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by grundle View Post
But as far as regulations are concerned, the federal registry gets bigger every year, not smaller.
Not so fast. JasonF got me on that one. It's basically the same now as it was in 1980. Roughly 80,000 pages then and now.

But I'd also like to see state regulations and see how that has gone in the last 30 years.
Red Dog is offline  
Old 10-16-10, 01:10 PM
  #16  
Political Exile
Thread Starter
 
grundle's Avatar
 
Join Date: Jun 2005
Posts: 16,322
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by wendersfan View Post
Yeah, because that whole financial meltdown a couple of years ago was caused by magic pixie dust.
Lenders used to require a 20% down payment. But then the government forced them to relax lending standards, and give mortgages to people who couldn't afford to pay them back:


http://hotair.com/archives/2008/10/1...cial-meltdown/

The quotes that explain the entire financial meltdown

October 12, 2008

by Ed Morrissey

For those who want a smoking gun to show the genesis of the financial collapse, this short sequence from a longer video I posted this week will do it. Clinton HUD Secretary Andrew Cuomo announced a settlement of a lending discrimination complaint with Accubanc, a Texas lender whose prerequisites for mortgages came under attack from “community organizers” at the Fort Worth Human Relations Commission and the city of Dallas. I clipped out this sequence to underscore its importance:

CUOMO: To take a greater risk on these mortgages, yes. To give families mortgages that they would not have given otherwise, yes.

Q: [unintellible] … that they would not have given the loans at all?

CUOMO: They would not have qualified but for this affirmative action on the part of the bank, yes.

Q: Are minorities represented in that low and moderate income group?

CUOMO: It is by income, and is it also by minorities? Yes.

CUOMO: With the 2.1 billion, lending that amount in mortgages — which will be a higher risk, and I’m sure there will be a higher default rate on those mortgages than on the rest of the portfolio …

Here, in fact, is the genesis of the problem, the ideology that created the monster. Cuomo, the Clinton administration, and Congress believed they had the right and the power to determine acceptable risk for the lenders, rather than lenders determining it for themselves in a free market. Even while imposing risk standards on lenders, Cuomo admits that he expects a higher default rate on the new loans — which is why the lenders didn’t want to write them in the first place.

In other words, the CRA didn’t get used to fight discrimination, but to force lenders to give money to high-risk borrowers for political purposes. And Cuomo knew it.

That was the political arrogance at the heart of the collapse. However, the CRA was more a sideshow than the actual problem. When Congress decided that enforcement alone wouldn’t generate enough mortgages to boost their political fortunes, they had Fannie Mae and Freddie Mac eliminate the risk entirely for lenders through the purchase of the subprime loans. Without that risk and with almost-guaranteed short-term profits of subprime loans, lenders went wild while Fannie and Freddie repackaged them as quasi-government bonds for investors.

While Democrats like Barack Obama, Harry Reid, and Nancy Pelosi keep blaming “greed” for the collapse, it was Democrats like Barney Frank and Chris Dodd building that “greed” into the system in order to drive the subprime lending market. And it was Democrats like Frank, Dodd, Maxine Waters, and Lacy Clay who suggested that regulators like Armando Falcon were racists for blowing the whistle on the Ponzi scheme they created.

The Democrats decided, as Michelle says, that mortgages were a civil right, and wouldn’t cost the American taxpayers a dime. How well is that working out, America? And now, the question you have to ask yourselves is this: Do you want the nation’s economic policies run by Obama, Pelosi, Reid, Dodd, and Frank for the next two years?
grundle is offline  
Old 10-16-10, 01:11 PM
  #17  
Senior Member
 
Join Date: May 2000
Location: Arlington, VA
Posts: 867
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by JasonF View Post
I think Langone is right. If we really cared about prosperity, we would return to the tax structure and regulatory regime that we had in the late 70s when he started Home Depot.

I'm sure he was talking about the corporate tax structure back then, which topped out at only 48%.
slappypete is offline  
Old 10-16-10, 01:12 PM
  #18  
Political Exile
Thread Starter
 
grundle's Avatar
 
Join Date: Jun 2005
Posts: 16,322
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by Red Dog View Post
Not so fast. JasonF got me on that one. It's basically the same now as it was in 1980. Roughly 80,000 pages then and now.

But I'd also like to see state regulations and see how that has gone in the last 30 years.
Oh. My mistake.
grundle is offline  
Old 10-16-10, 01:12 PM
  #19  
DVD Talk Hero
 
jfoobar's Avatar
 
Join Date: Jun 2000
Posts: 37,812
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by grundle View Post
Yet today, Home Depot is staffed by more than 325,000 dedicated, well-trained, and highly motivated people offering outstanding service and knowledge to millions of consumers.
Wow. So how many people total work in Home Depot stores anyway?
jfoobar is offline  
Old 10-16-10, 02:50 PM
  #20  
DVD Talk Legend
 
Dr Mabuse's Avatar
 
Join Date: Jun 2007
Location: 75 clicks above the Do Lung bridge...
Posts: 18,950
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by dork View Post
It was caused by greedy poor people!


Nice.
Dr Mabuse is offline  
Old 10-16-10, 03:26 PM
  #21  
DVD Talk Gold Edition
 
Join Date: Jan 2003
Posts: 2,861
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by grundle View Post
Lenders used to require a 20% down payment. But then the government forced them to relax lending standards, and give mortgages to people who couldn't afford to pay them back:


http://hotair.com/archives/2008/10/1...cial-meltdown/

The quotes that explain the entire financial meltdown

October 12, 2008

by Ed Morrissey

For those who want a smoking gun to show the genesis of the financial collapse, this short sequence from a longer video I posted this week will do it. Clinton HUD Secretary Andrew Cuomo announced a settlement of a lending discrimination complaint with Accubanc, a Texas lender whose prerequisites for mortgages came under attack from “community organizers” at the Fort Worth Human Relations Commission and the city of Dallas. I clipped out this sequence to underscore its importance:

CUOMO: To take a greater risk on these mortgages, yes. To give families mortgages that they would not have given otherwise, yes.

Q: [unintellible] … that they would not have given the loans at all?

CUOMO: They would not have qualified but for this affirmative action on the part of the bank, yes.

Q: Are minorities represented in that low and moderate income group?

CUOMO: It is by income, and is it also by minorities? Yes.

CUOMO: With the 2.1 billion, lending that amount in mortgages — which will be a higher risk, and I’m sure there will be a higher default rate on those mortgages than on the rest of the portfolio …

Here, in fact, is the genesis of the problem, the ideology that created the monster. Cuomo, the Clinton administration, and Congress believed they had the right and the power to determine acceptable risk for the lenders, rather than lenders determining it for themselves in a free market. Even while imposing risk standards on lenders, Cuomo admits that he expects a higher default rate on the new loans — which is why the lenders didn’t want to write them in the first place.

In other words, the CRA didn’t get used to fight discrimination, but to force lenders to give money to high-risk borrowers for political purposes. And Cuomo knew it.

That was the political arrogance at the heart of the collapse. However, the CRA was more a sideshow than the actual problem. When Congress decided that enforcement alone wouldn’t generate enough mortgages to boost their political fortunes, they had Fannie Mae and Freddie Mac eliminate the risk entirely for lenders through the purchase of the subprime loans. Without that risk and with almost-guaranteed short-term profits of subprime loans, lenders went wild while Fannie and Freddie repackaged them as quasi-government bonds for investors.

While Democrats like Barack Obama, Harry Reid, and Nancy Pelosi keep blaming “greed” for the collapse, it was Democrats like Barney Frank and Chris Dodd building that “greed” into the system in order to drive the subprime lending market. And it was Democrats like Frank, Dodd, Maxine Waters, and Lacy Clay who suggested that regulators like Armando Falcon were racists for blowing the whistle on the Ponzi scheme they created.

The Democrats decided, as Michelle says, that mortgages were a civil right, and wouldn’t cost the American taxpayers a dime. How well is that working out, America? And now, the question you have to ask yourselves is this: Do you want the nation’s economic policies run by Obama, Pelosi, Reid, Dodd, and Frank for the next two years?
Is that implying that there was no private market for mortgage backed securities?
msdmoney is offline  
Old 10-16-10, 03:33 PM
  #22  
DVD Talk Platinum Edition
 
Join Date: May 2001
Posts: 3,391
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by Ken Langone View Post
Yet today, Home Depot is staffed by more than 325,000 dedicated, well-trained, and highly motivated people offering outstanding service and knowledge to millions of consumers.
Seriously has Mr. Langone shopped at Home Depot in the last ten years?

My general experience is that Home Depot is staffed by poorly trained, we'll get to you when we feel like it, disinterested people offering little to no service or knowledge to millions of consumers.

To top things off these super stores like Home Depot so dominate the market place that it has adversely affected other markets like lumber suppliers. Since Home Depot does not care if they get quality wood the suppliers manufacture to their largest customers’ desires which in turn has hurt the quality of the entire market.
WCChiCubsFan is offline  
Old 10-16-10, 06:46 PM
  #23  
DVD Talk God
 
Join Date: Jun 1999
Posts: 68,522
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

I like Home Depot because I get the veterans discount.

I also get it at Lowes.
classicman2 is offline  
Old 10-16-10, 08:42 PM
  #24  
DVD Talk Limited Edition
 
Join Date: Feb 2001
Location: So Cal
Posts: 7,072
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Realistically, if home depot started today, it wouldn't get off the ground for a few reasons that render the Corporate tax rates and regulations totally irrelevant:

1. It's a saturated market. They came into a market with no big-box hardware stores at a time when suburban sprawl was increasing, homes were getting larger, and mom-and-pop hardware stores were on the decline. It's a competitive market segment now, so of course a small start-up wouldn't stand a chance in the face of discount retailers. Oh, that might not be such a good thing after all...

2. Home construction is on the decline. Duh.
Superboy is offline  
Old 10-16-10, 08:43 PM
  #25  
DVD Talk Limited Edition
 
Join Date: Feb 2001
Location: So Cal
Posts: 7,072
Re: "If we tried to start Home Depot today, it would never have gotten off the ground

Originally Posted by classicman2 View Post
I like Home Depot because I get the veterans discount.

I also get it at Lowes.
HOLY CRAP! you're old!

No wonder you actually get my historical references! you were actually there to witness it!
Superboy is offline  

Thread Tools
Search this Thread

Archive Advertising Cookie Policy Privacy Statement Terms of Service

Copyright © 2018 MH Sub I, LLC dba Internet Brands. All rights reserved. Use of this site indicates your consent to the Terms of Use.