Hans Hoffmann's Blog

I guess with all the reviews I went through at Microsoft, it is time to give Steve Ballmer his final review.  He was with the company for nearly 34 years and a part of its foundation.  He was a primary reason the company rose to great wealth and fame.  He was a cornerstone of the company’s growth, but as in all things in life, things come to an end.  In Steve’s case he probably did not go out as he would have wished.  To be frank it was rather quiet, which is odd coming from a man who is anything but quiet.  When Steve was in a room everyone knew.  In order to do a proper review we will have to have a system in place.  I shall borrow one from the various Microsoft review systems I was a part of during my 18 years at Microsoft. Now we had the old system of five being the best and one being the worst.  Then we had the last system that inverted the old system. Never quite followed why HR wanted to do this.  In any case I think I am going with the middle systems that was between the 1 to 5 or 5 to 1 system.  This consisted of the following: did not meet expectations, met expectations and exceeded expectations.  We shall also break this out by category.  I have laid out the following categories: 1) Financial Results 2) Vision 3) Talent Acquisition and Loss 4) Company Enthusiasm  5) Leadership.

One thing we have to give Steve credit for is he saw a company that was growing in terms of its financial results and number of employees.  Very early in his tenure he bought into the business models created by than business guru and GE CEO, Jack Welch.  Though I cannot agree to a lot of what Jack was a proponent of, it did enable Steve to create a business machine.  It created structure where there was little.  He took Microsoft’s software licensing machine to new heights. Over the course of his tenure the numbers were always on Steve’s side.  As he looked to make a more efficient company.  During Steve’s tenure revenues increased from $20 billion to over  $70 billion. I once had a sales manager tell me that in sales it is quite simple and brutal, “you are what your numbers say you are”.  For Steve one can only say he was brilliant in this regard.  Review Score: Exceeded Expectations

A key component of any companies survival is vision.  A company must envision where it will be in ten yours and how it will get there.  In technology this is even more important as companies must continually innovate to stay alive.  One minute you’re in, the next your out (kudos to Heidi Klum for this quote) Steve had a vision of where the company would be and how it would get there.  The problem was it was generally the wrong vision.  His vision usually started with and ended with Windows and Office.  Even a month before he stepped down he was saying to Microsoft employees, “this is a Windows company”.  The problem was he was not seeing that it was rapidly becoming a non-Windows world.  He failed to see and understand the consumerization of technology.  When the iPhone launched he did not recognize what had happened.  How the industry floor had shifted from under him,   Steve often said he loved Microsoft.  He bled Microsoft.  He had been with the company for over 33 years.  The problem was that products that created Microsoft’s success, were products he could not see beyond.  The numbers backup up the decision, but at the cost of the future for the present.  Review Score: Did not meet Expectations

In the technology industry your technology giants usually have a lot of rock star talent behind their CEO.  This was certainly true of Microsoft during the Bill Gates era.  There were some great developers and visionaries in the ranks.  At Microsoft you had people like Nathan Myrvold, Ray Ozzie, Paul Maritz, Bob Muglia, Charles Simonyi, J Allard, Brad Silverberg, etc..all the aforementioned are gone.  There have been few if any replacements.  The big reason is Steve wanted immediate action and valued business leaders more than technology leaders.  There was really only one visionary that Steve trusted and tha was Bill Gates.  When Bill left he left a large void that was never filled.  It largely, I believe, came down to an issue of trust.  Even when Bill left, putting Ray Ozzie in charge of driving the technology vision, Steve did not seem to want to listen.  In the end all the talent at the top had pretty much all left, leaving it all to Steve.  In order to steer a ship you need to know where you are going, this was never quite clear with Steve at the helm  Review Score: Did not meet Expectations

There was Steve’s enthusiasm for the company and then the employees enthusiasm for the company.  If it were Steve’s enthusiasm alone that was being reviewed the rating would be off the charts.  When Steve said, “I love this company”, it was with unbridled passion.  He really cared. One of the negative things that happened during hos tenure was the creation of a review system based on the Jack Welch model implemented at GE.  It was designed to foster competition in the employee ranks, but it did so at the cost of innovation.  Without going into details it fostered a system if trying to gain political advantage and in the end soured many employees on the company, which was disheartening.  Steve tried mightily to keep employees in his world of “Microsoft love”, but in the end a key part of the Microsoft culture was lost.  Like on Capitol Hill politics breeds its own kind of poison,  In my first 12 years at Microsoft, everyone loved the company.  As the years moved on and exciting technologies came from outside the company the love of Microsoft seemed to float out with it. Review Score: Did not meet Expectations

Leadership as is often said is not something you  are born into, but the events that surround you create the leader.  When Steve was appointed CEO by Bill it seemed the natural course.  He had been Bill’s number two for a long time.  The fact that he was named CEO to replace Bill was not a big surprise (Bill stepping down, however, was a big surprise).  Early on Steve did some important things.  The DOJ trial was behind Microsoft, but there was housekeeping that needed to be done.  He settled with Sun Microsystems.  He realized the company had grown and was no longer a startup anymore.  It needed to put in place policies and systems befitting a Fortune 500 company.  Where Steve veered and went wrong was forgetting what had made the company great and staying on too long as CEO.  If he had stepped down in 2010 I think he could have had a positive legacy.  Perhaps it was the fact that the country was still recovering from the worst economic crisis on history.  But more likely it was the fact that Steve could not see anyone but him running the company.  Finally the fanatical passion of Microsoft employees seemed to weaken a great deal.  Partly it was just an aging work force, partly because the technical visionaries were gone.Primarily the Microsoft culture had changed.  In the end I thought Steve’s leadership was either half empty or half full, depending on how you look at it.  In my mind it puts him in the middle.  Review: Met Expectations

Microsoft is now forging ahead under the guidance of Satya Nadella and it is still early going.  In truth a large legacy has been left behind and it will take time to sort out what will be kept and what will not.  We have years (I hope) before I write about the legacy of Satya Nadella.  For Steve’s sake I hope that is ten years from now otherwise if Satya were to set with the sun much earlier the blame will likely go to what he inherited not what he created.  For Steve post Microsoft he is already doing some exciting things.  I was happy he resigned from the Microsoft Board of Directors.  I never felt it wise to have your former boss on the Board especially of he started scrutinizing decisions Satya was making. This will give Satya more freedom at a time when he desperately needs that freedom. Finally Steve has thrown himself into professional sports as he went out and paid too much for the LA Clippers.  However in getting rid of Donald Sterling I think we can all agree it was money well spent. Steve was always driven by passion, he is an emotional leader.  I think he will succeed, but as for Microsoft that time has passed for Steve and he left with a lot of battle scars.  I am afraid history will not be kind.  Just like when I started at Microsoft and business schools joked about how IBM did not see the industry direction, time has passed and now Microsoft will be similarly remembered as having its IBM moment, all under Steve’s leadership.

Good Night and Good Luck,

Hans Henrik Hoffmann October 3, 2014

I had been asked to write my impressions on Satya Nadella’s new role as the third CEO in history. Something up until now I have not been all too excited to do.  To be honest even nearing six months I will say up front, it is still way to early, it takes time to make your mark on a company. Especially an industry legend such as Microsoft. However I have seen some good things that may give us in site into where Satya is going with the company.  It has been a crash course for Satya, but at least publicly he has done very well and he looks comfortable in hos new role.  He has signaled his mantra for Microsoft, “Cloud First, Mobile First”.  Nearing six months we are starting to get an idea of where Satya wants to take the company.  I will say it has gone form “blurry” to “less blurry”.

In appointing Satya a couple of things have worked in his favor.  Despite all my issues with Steve Ballmer he did some things right.  In his obsession to create an enterprise first and technology company second, he did create a revenue engine.  Microsoft  continues to drive billions in quarterly net profits and meet or exceed Wall Street’s expectation.  I can’t predict how long this will be the case in a fiercely competitive environment, however it does provide Satya time to implement the changes he wants without too much external scrutiny.  The second thing that Satya brings to the table that Steve did not  is technical chops.  This is valuable in the Microsoft  engineering groups.  Steve was always viewed as a sales guy and more interested in the business side than having a discussion about the long term vision for the company, especially if that vision did not include Office and Windows.  Satya so far has demonstrated an ability to accept what the industry is doing and where it is headed and to attempt to adapt to it.

A couple of things of late that have impressed is the appointment of former VoiceStream CEO John Stanton to the Board and the hiring of Qualcomm exec Peggy Johnson to be Sr VP (replacing Tony Bates).  The former I am not sure how much Satya was involved, but I can only assume he encouraged and approved.  The second was all Satya.  If Microsoft has one colossal failure under SteveB it was mobile.  It seemed during his tenure it was a concerted effort to deny failure  These appointments are an admission that the company needs help and needs help fast.  Microsoft got a couple of rock stars, now it is just a question of is it too late and will it be enough

Satya has also endorsed and accepted reality.  At the Microsoft Worldwide Partner Conference in July, Microsoft COO Kevin Turner admitted that when you include mobile devices, Microsoft’s OS share was 14%.  It was the stat everyone in the industry knew, except Microsoft.  It was refreshing to finally hear Microsoft admit it.  Under Steve that did not happen.  At time sit was hard for Steve to let go of eth PC, because he loved it so much.  This admission happened and it happened with Satya’s approval.  In tech where things move so fast I believe it is important to be honest about the position you occupy.  Satya is right about “Mobile First”, it is where we are at in the world and it has provided us with freedom to work and play at the same time while not being connected, not having a keyboard.  Now Microsoft can stop being so defensive and perhaps be more aggressive in tackling new market opportunities.

Microsoft really announced a huge round of layoffs.  The brunt being absorbed by Microsoft’s acquisition, Nokia.  When Microsoft was pursuing this acquisition it was rumored that Satya was not on board with the idea, but Steve convinced him it was the right decision and Satya capitulated.  This is where I can only guess, but though Satya followed Steve’s lead, I don’t think in his heart he was ever on board with the idea.  I am sure he would have preferred a Google Android model compared with an Apple model.  The Google model was more in line with the Microsoft culture of partnering. When Satya wakes up in the morning and he sees a division bleeding cash and market share on a good day hovering around 4% he has to envision a scenario where they become competitive, but Microsoft has been trying to come up with that game changing strategy for seven years and is no closer now than they were seven years ago.  Now Satya has to clean up this mess while saving face.

In Satya’s company wide memo he talked a lot about streamlining the company, reducing layers to get things resolved and solved.  Changing the culture at the company.  These are tough tasks.  I remember personally dealing with a CIO at T-Mobile who said, “Technology change is easy, cultural change takes along time”.   The first can be read a couple of ways, the simple being we must reduce the amount of organizational layers.  Basically undo a lot of the stuff Steve was so focused on building.  The second and the one I subscribe to is it means shedding some businesses.  That is something that will be interesting to follow.

Shedding more light on this it seems knowing a bit about Satya’s background.  HE had three exec jobs at Microsoft I remember.  He was in online services (Live than Bing), Microsoft Business Solution (Dynamics) and Azure.  Bing has struggled since it inception.  It still lags far behind Google. despite a big budget and many years to overcome.  Microsoft Business Solutions has struggled against SalesForce.com and SAP.  Azure still lags behind Amazon, with other big entrants into the market, like Google.  I think Azure is very safe as it is core to Satya’s One Cloud mantra.  The challenge with MBS is the nature of the business is heavily reliant on consulting engagements as no matter what CRM or ERP system you choose, heavy customization is required, particularly in the enterprise space.  This is not something the Microsoft has shown a great desire to do directly in the past, so it would rely in partnerships to do it.  the question is will the Accenture’s and Cap Gemini’s of the world promote Microsoft MBS solutions?  There has always been a view that Microsoft should dump Bing, I am not for that vie was Microsoft has gleaned a lot of valuable learning in building data centers and developing strong search algorithms.   I do think however something will need to be off loaded, it might even be XBOX, this will be a test of Satya’s leadership moving forward.

A very bright spot for Satya, that I stated the blog with is that he is an engineer, he is a technical guy.  Able to understand and contribute to technical discussions.  This is in addition to cash flow will buy Satya the time he needs to transform the company.  it always seemed to me in the past is the product groups followed Steve’s lead, they just didn’t buy into it.  Satya seems willing to provide guidance but also to listen, the latter being something that was mysteriously misplaced over the past decade.  Satya is very much still in the “honeymoon” phase of his leadership, and Microsoft’s revenue growth will likely help extend that marriage.

Finally I think what has been most impressive in Satya’s first six months is he seems at relative ease with role.  He has benefited from the fact that he is not an outsider.  He is steeped in the Microsoft culture.  He has been more or less raised in the Microsoft culture. Early on he seems to recognize Microsoft’s mistakes and where the industry is headed.  Something that has been sorely lacking at the company, and now that the company has a CEO willing to think forward, it is like leading a horse to water.  Satya was right in his memo this industry doe snot respect history, only innovation.

Good Night and Good Luck

Hans Henrik Hoffmann August 7, 2014

 

 

As a society we value our privacy, it seems innate in our culture.  We love to say, “in the privacy of our own home”.  However it seems with the advent of new technologies, we have created a world of new scenarios. With each great leap forward things get faster, more precise and much smaller.   As this  has happened we have seen our basic privacy, seemingly erode. Just think about when we go shopping or participate in other activities.  Any store we go into has camera’s throughout the store, monitoring our every move.  Art Museum..certainly the eyes of the camera are upon you.  Is it limited to the private sector?  Certainly not.  When these things happen it is not apparent if our government can help us or should we fear what the government has access to. How much of our lives is our own and how much will be public record? We are offered an array of online services designed to help us engage the world, by sharing our personal information to our friends, but in the end we may desire to set boundaries but anyone who wants access to that information will and can find a way to access that info.  The question before us is what is privacy and has it vanished forever?

Starting with our government I have grown up in a generation of distrust if government.  Not by everyone, but certainly a very vocal right-wing element of society.  The influence of George Orwell’s epic book, “1984” is evident or maybe his other book, “Animal Farm”, though I think most people who despise government have not read either. Yet time after time when the country enters crisis we turn to government to hep and aid us during troubled times.  When 9/11 occurred we felt it best to lessen our civil liberties by enabling the government to pass the Patriot Act.  We did not want something like 9/11 to happen again and were powerless to do anything on our own. We reacted without giving proper thought to what we were giving up.  Fear has away of doing these things. In this modern age that has enabled government to collect data on its citizens in new ways and in larger data arrays then ever before.  It raises the question of what is the price of freedom and what are we wiling to sacrifice to maintain it?  The Patriot Act was signed in 2001 by George W Bush.  It remains with is today.

When I worked for AT&T and did some sales calls, one of particular interest was to an insurance company.  They wanted to talk with us about collecting data from automobiles.  Using the AT&T  network to transmit and collect data from automobiles. It is not hard to understand why.  The ability to capture driver behavior and provide real-time insurance rates, saving the good drivers money and costing the bad drivers more.  It is a scenario that makes sense, but our relationship with insurance companies is a double-edged sword as we like them when we need them but we don’t  when they raise our premiums.  The fundamental question I remember coming out of the meeting is whose data is it that sits on the mobile platform of the future?

With the internet we keep delivering new services.  In the last decade we have seen the rise of social media.  Things like Facebook, Twitter, Instagram, etc..All collecting personal user behavior.  Data that these companies will use to create new algorithms to better serve our needs.  How they use this data is a mystery.  Facebook has over a billion users, they have opportunities to take data and market to its user base in new and exciting ways.  We are also now mobile allowing Google to determine our current location.  Thus they can provide us better and more relevant services.  Which I find in general we do.  We have basically signed up so we can be tracked.  Is that data our data? The quick answer is no.  When a crime is investigated that location data becomes valuable to law enforcement.  If wives suspect a husband of cheating they will be able to locate him (I did check the Apple store to see if such an app existed, but could not find one).  Then the question would be; would you be the only who has that data?

Then there is the new and emerging area of drones.  We have all sorts of new scenarios and issues being created.  In one case a woman I used to work with looked outside her window in a high-rise condo in Seattle and lo and behold something was looking back at her.  In this case  it was claimed aerial shots were being taken for real estate surveys.  A similar scenario played out in San Francisco, in that case it was a hobbyist.  On the flip side scenarios are being deployed and envisioned for commercial purposes.  A report out of India had a company using drones for pizza delivery.  Jeff Bezo’s, CEO of Amazon, outlined a future in which drones would handle delivery of Amazon products.  These are all scenarios being driven by the private sector, but once a drone is airborne it is basically in information collection agency, so what other information is it collecting?  It is one thing if the drone just delivers a pizza, to a specific set of coordinates.  However these drones are essentially roving eyes, what other data do they capture as they deliver your goods?

Beyond the private sector there is a great interest in the public sector to use these new mobile video surveillance tools.  Your local police force now has a new tool to use in combating crime.  In some cities this has gone forward, Houston.  In others this caused outrage.  The Seattle Police force purchased one and was asked to return after a public outcry.  However over time I think this will be common place as more and more of the human element is taken out of law enforcement.   For those intending to commit crimes, your chances of success are about to diminish.  The question will be what are we willing to sacrifice for safety? Can we envision a police force of RoboCops?  Will we be able to use this surveillance to anticipates acts of crime?  Could we see a significant reduction in the crime rate in the United States?

A little over a year ago MIT announced they had created drones the size of a dime.  The one thing we know from the past, which falls in line with Moore’s law, is these drones will double in capabilities every 18 months.  They will get smaller.  More sophisticated.  They may not be visible to the human eye.  They can be anywhere and everywhere.  The benefits will be great for certain scenarios.  You can see in a hostage scenario you can let a dozen of these little bugs into the hole where the criminal is hiding and get data on the circumstances in ways that did not exist before and thus make better informed decisions and reducing the risk if fatality to the hostage.  Probably in time those little bugs will be armed.  But why limit to law enforcement, what happens when the other side is allowed to get a hold of these little bugs?  It could be a peeping Tom paradise.

So what is privacy anymore?  We sacrificed a lot when we logged on to the internet.  The internet has become unplugged and gone increasingly mobile. We now have the term Big Data.  Data that Amazon can use to determine and predict individual buying behavior and match the appropriate deal to the customer.  We can watch user internet browsing behavior in real-time, which enables us to capture pedophiles.  I saw a recent news report on TV where it showed a police data center that could pull up a map and track of the number of people potentially looking for child porn online. Based on the number of hotspots on the map, you would have to increase the size of the police force to arrest and prosecute everyone.  This is a benefit of online surveillance, but it shows the level of knowledge available from watching internet traffic. As all this goes on we must admit we opt into it when we sign in to websites, provide personal data, press the OK button without fully reading what is being asked.

The question is what is privacy and is it evaporating right before our eyes?  We are a connected society and that does not mean we are all holding hands.  We opt in for basic consumer satisfaction, instant gratification.  We connect with friends and family.  We can do these things while looking over a serene lake setting or gazing and wondering at snow-capped mountains.  All is good until it is not.  Don’t look to blame the government.  Nor can we place the blame on big corporations.  In what amounts to a blink of an eye we all opted in.  We bought PC’s, mobile phones, joined a social network, provided our location to Google Maps, we wanted instant gratification but we gave away something very basic that we took for granted, our privacy.  We love to say “In the privacy of our own home”, the reality we have let everyone into our home, just by clicking in a button.  Once they are in, they don’t want to leave.

Good Night and Good Luck

Hans Henrik Hoffmann July 29, 2014

 

 

 

The future is in front of us, not behind us. Not exactly revolutionary words as much as an obvious observation.  But in these days of technology breakthroughs and change we see and hear of new dynamics taking place all the time.  We have all heard by now the imminent demise of the desktop.  That the Microsoft Windows Paradise is about to all come undone.  If you look at industry trends and the painful release of Windows 8 you may even lean heavily in that direction.  On top of that Google seems to be getting a lot of favorable press with its Chromebooks, the browser-based device.  We are in an ever-increasing connected world with new software services being created and delivered all the time.  Rather than fight for past glory it may be time to embrace future glory, namely for Microsoft.  Microsoft would be well served by exploring the possibility of a browser-based piece of hardware running Internet Explorer and not Windows.  Blasphemy?  Of course it is but here are a few reasons why I think this course of  action is wise and necessary.

I have come to the conclusion that I hate my home laptop hard drive.  The amount of crap that gets loaded onto my machine, much in the name of security and privacy, in the end leads to a painfully slow boot process and overall slow machine.  But this is the challenge of a home pc/laptop.  You as an individual are responsible for its protection.  But most people do not have the technical know how to even begin to contemplate how to do that. As a result we are happy to sign up for services to help us manage that desktop.  This can work and even help, but often leads to pain.  Not to mention there are so many services and information that we are asked to give up, we cannot remember what we have agreed to.  For anybody who owns a Windows-based machine, who has not received a call from somebody in India asking, “We see you own a Windows PC?”, “You may be at risk of a virus”…usually 2-3 questions/comments before you hang up the phone.  Uneasy with the fact that everything they said was true.  They know what is in your hard drive and probably have access to a lot of info you do not want to provide or even be known.  It seems an invasion of privacy but somewhere along the line you agreed to it.

We are always connected.  We have access to the internet whenever and for whatever we need.  If you think of the percentage of time spent on your laptop how much is being done locally versus up on the internet, where do you spend your time?  We spend time researching vacations, booking airfare, shopping online.  We spend more time in our browser than any application. It is a windows to the world and it is an increasingly fragmented market.  We have Internet Explorer, Chrome, Mozilla’s Firefox, Safari, and Opera.  If we are not connected, then we cannot use our browser and there is simply not enough interesting stuff stored on our local machine to make it a compelling experience.  Why not just have a device that is a browser to connect me to and experience that world?

The Cloud is increasingly delivering more and more consumer based services.  Many of the applications we used to run locally on our machine or in our corporate environment as a two tier or three-tier application service are now available in the cloud as application services.  Many of the interesting start-ups are Cloud Providers, such as Box, DropBox etc..There are also established vendors like SalesForce and Amazon.  Even Microsoft with apps like Office 365 and OneDrive are embracing the cloud, making the need for local storage less relevant.  More importantly since all this data is housed in highly secure data centers the Amazons and Microsoft’s of the world handle data redundancy and security.  End-Users need to use their device but they need to not be in the business of having to manage their device.  The goal of technology has always been about improving our productivity and decreasing our pain.  Unfortunately with the advent of desktops and laptops, with time complexity increased and along with it the associated pain.  It is time to let go and move to the ether, that is the cloud.

We are moving beyond the desktop, this much is obvious.  Microsoft at times has been guilty of trying to hang on to the past and sell the successful history of Microsoft in repackaged versions of the latest version of Windows, rather than sell people on the future of the industry.  For a long time now the primary application we run on our machine has been our browser.  The browser is a window to the world and now thanks to all the information and services, it is really the only place we spend on our time, and frankly need to spend our time.  Microsoft has a great solution that it could offer as its new devices and services mantra.  Steve Jobs once said, “If you don’t cannibalize yourself, someone else will” . No surer truth was ever said and that is the dilemma Microsoft now finds itself in.  That being said new leadership is slowly starting to sow the seeds of change.  Steve Ballmer said before he left, “We are a Windows Company”, but I would argue that resonates with Microsoft’s past not its future. New Microsoft CEO Satya Nadella has already made an impact on the corporate culture at Microsoft.  For starters changing the name of Microsoft’s cloud offering “Windows Azure” to just “Microsoft Azure”.  At first glance he seems to see the writing on the wall and  Satya is starting to distance the company from Windows 95, something long overdue.  It is time to discover the next big thing not reinvent the old one.

My argument, would be that the focus of OS development needs to shift and more focus should be put on the browser, specifically Internet Explorer.  We are entering a period where Microsoft can slowly start de-emphasizing the need for Windows.  It took twenty years for Microsoft to create and launch Windows 95, it has taken nearly twenty years since that time for Microsoft to stat evolving beyond Windows. Before Steve Ballmer left he called Microsoft a “Windows” company.  Windows has been great and very profitable, but even if Satya were to take my advice and focus on Internet Explorer I would add a second piece of advice.  Do not become an Internet Explorer company or even a browser company.  become what you always have been; A technology company.  If Microsoft does just that one simple thing the revenue will follow.  Not in the browser or even the device but the services that will be offered as part of the experience.  The assets exist at Microsoft such as Azure, Office 365, OneDrive, XBOX, and Bing, to name but a few.  Save us the headache of a corrupted hard drive with security issues and drive the experience of the future.  Reinvention is a beautiful thing and can reap rewards, the flip side is watch yourself get eaten by competition with cannibalistic tendencies .

Good Night and Good Luck

Hans Henrik Hoffmann April 29, 2014

 

 

 

I grew of age under our 40th President, Ronald Reagan. I was in junior high school when he was elected in 1980 and sworn in, in January 1981. I lived through eight years of what was a really un-eventful period of time. The economy grew during his time in office. There was no war during his time in office (Grenada..really?), Even the Soviet Union was rather tame at this time creating their own problems in Afghanistan. Probably the most notable events during his time were his Supreme Court nominees and his tough stance with the Soviet Union, in what was becoming a new global arms race. Despite what on the surface would seem an anemic presidency he has remained a political influence on not just the Republican Party but America.  It stems from probably the simplest of Reagan quotes, “Government can’t solve your problems, government is the problem”.  To this day we hear of the evils of government.  Government cannot help you.  News commentators, leaning to the right, insist on screaming into the television about the evils of government. Probably because we are in a time when younger generations are saying, “lets move on”.  In reality the Reagan revolution is over and has been coming to an end for some time.

I guess only in America could a Hollywood actor not only become President, but cause some sort of popular movement.  To be fair Ronald Reagan created the revolution but he borrowed and was greatly influenced by former Arizona Senator and Presidential Candidate Barry Goldwater. However Reagan had the benefit of timing and he was a great communicator of his ideas and beliefs.  He leveraged his acting background very well. At the time of his successful Presidential run,  the incumbent President, Jimmy Carter, was dealing with both an economic crisis a home and with a hostage crisis in Iran.  Reagan offered change (always a good place when running against an incumbent) and strength against the Soviets.  Unlike President Carter, who was honest to a fault. Reagan offered a positive outlook for America and a solution to governments problems in running the economy.  With Reagan the rise of the free market economists was completed Adam Smith, Ludwig Von Mesis and Milton Friedman could all sleep better.  We were all of a sudden hearing about Supply side economics and the Laffer Curve, and many young individuals were becoming converts, especially notable was our university economic and business schools.

Reagan’s accent was a result of Lyndon Johnson’s Great Society.  A period where LBJ had declared a “war on poverty”.  As much as Republicans try to complain about FDR’s policies LBJ created medicare and welfare.  Government had grown and when government grows it can get into areas where it’s role can become questioned.  The flip side is though when things go bad it seems to be human nature that we turn to our government for help.  We did during the great depression and we did during the recent financial crisis.  We had gone through a period of strong control of congress via the Democrats.  From the time of FDR to Nixon, we only had the Presidency of Dwight Eisenhower to point to as a period where the Republicans controlled the oval office.  A shift was inevitable, but in order to create these tidal change in directions, a movement needs something to follow.  Ronald Reagan was able to fill and add color to that void.

It has been over thirty years since Ronald Reagan took office and like the country he inherited the country continues to change as does its views on politics and the role of government. However Reagan is still sanctified within the Republican party.   He was the great conservative leader, the leader of the conservative movement.  Rush Limbaugh, would make him god if he had his way. Ann Coulter I am sure has a shrine to him.  He could talk to both sides of the party, the fiscal conservatives and the religious right.  His vice reached its pinnacle under George W Bush, even as his influence had started to fade.  I think if he were alive today he would be shocked by the in fighting that is happening today in the GOP.  His son, Ron Reagan Jr, once said that he thought his father would be disappointed in the lack of civility in today’s political arena.  Having lived through his Presidency I would concur.  Ronald Reagan had a strong set of ideals but he did not need to belittle or insult people to state his views.

All this however is history.  This country is a country built on change and a lot of that change is driven by generations.  The current group that is coming of age is not so enamored with the previous generations.  Government is no longer the enemy, corporate America is the enemy (I doubt they view them as “people”).  The environment is in danger, global warming is real, if government needs to regulate then do it.  They are a more pragmatic group and not driven as much by greed, but a desire to do good.  To have some self-worth. Greed is for the weak.  The Millennial’s as they are called seem to be more concerned withe greater good as opposed to self-preservation.  The debate on global warming is over for them, let snow see what can be done to heal the earth that we live on.  They have grown up in the age of the internet, where boarders have been broken down and geo-politics does not seem as relevant.  The idea of possessions do not govern their value chain.

As these changes occurred what Ronald Reagan created began to dissipate.  It is often argued in the US that our individual rights are the most important thing that we have.  But for the pragmatic generation if you don’t have a planet worth living on what good are your individual rights?  I am moved by this new point of view.  Rather than fight fixing the problems lets fix the problems.  Do the right thing, not the cost-effective thing.   The idea that fee markets are free is being replaced.  In large part due to the financial crisis which at its core was just greed in overdrive.  Despite efforts to blame government, it was large financial institutions running out of control that were at the center of the crisis.  You combine this loss of faith in capital markets with a generation not so self-absorbed in the idea of wealth creation and self interests the transition beyond what Ronald Reagan created has been well underway for sometime.

Bill Clinton was often hailed as the first post World War II President.  We are nearing another generational shift where we will start having leaders in congress who are of the internet generation.  Moving forward I expect to GOP to start to morph and change and distance itself from Reagan’s slogans.  They may not be in time for 2016, but the GOP will return.  Just as the democrats returned under Clinton A new voice will appear on the right.  I think the one lesson that the current GOP could still learn from Reagan is you have to be likable and civil.  I look forward to witnessing these changes.  Rather than a media and society that has been overly negative over the past decade (s) I think the millennial’s will have a more positive outlook on what both government and society at large can accomplish in the coming decades.  We continue to learn from the past to improve the future.  Reagan had his time and influence and now we must move on as we always have.

 

Good Night and Good Luck

Hans Henrik Hoffmann April 15th 2014