Rx: Self-Help for Hard Times | East Bay Express

There’s an old story about a minister who lived in a town on the banks of a river that, one particularly wet season, spilled its banks. As the flood waters rose, the man went to the church to pray for God’s help and protection for the town. Shortly thereafter a truck drove up and offered to take the reverend to safety.

“Thank you, but I’m trusting in God. You should help others in greater need,” he replied.

Hours later the water had risen high enough to flood the first floor of the church. The minister was on his knees praying in his second floor office when a boat motored up to the window and a offered to take the reverend to safety.

“Thank you, but I’m trusting in God. You should help others in greater need,” he replied.

As the river continued to rise, the minister scrambled to the church’s roof and was in deep prayer when a rescue helicopter flew overhead and dropped a rope down in order to take the reverend to safety.

“Thank you, but I’m trusting in God. You should help others in greater need,” he replied.

Shortly thereafter the church collapsed under the force of the water and the minister perished. Standing before his maker, the man disappointedly asked, “God, I trusted you to see me through the flood. Why did you not answer my prayer?”

“I sent a truck, a boat, and a helicopter,” God replied. “What were you expecting?”

You might think this story would have some relevance to the situation in Fargo, North Dakota, but I thought the parable was more apt to our nation’s current financial situation.

I see captains of American industry waiting around for a parting of the skies and a booming voice (echoing from somewhere in the vicinity of Washington, D.C.) to tell them everything’s going to be alright; the only thing they need to do is show the proper obeisance (while begging for their stimulus check). Meanwhile, the very thing they need to move forward (and take the economy along with them) is, perhaps, the most obvious thing: guts and confidence.

I recently read an opinion essay by author Jean Strouse in the New York Times describing the situation during the United States’ banking crisis of 1907, which found President Theodore Roosevelt otherwise engaged while giants of American industry marshaled the resources necessary to prevent the collapse of our financial system. Sure, they were motivated by self interest, but isn’t that the whole idea?

Among the heroes of that situation, banker J.P. Morgan knew that if his fortune – and the fortunes of those who trusted and invested in him – were to survive the crisis, he was going to have to do something about it on his own. Roosevelt and the U.S. Treasury weren’t poised to write any checks to cover the losses incurred by Morgan or any other wealthy industrialists. Morgan consorted with his peers and figured out a solution to the problem. It was either that or fail.

J.P. Morgan was one man, but he was a man who acted decisively to not only avert disaster, but helped restore confidence in the market. Strouse argues that Morgan almost single-handedly turned the situation around because he understood the stakes and was willing to do what it took to win. Because of his actions we now look back to 1929 – and not 1907 – as our nation’s darkest economic hour.

The stakes have changed dramatically today, and so has the American industrial philosophy. “Too big to fail?” Blasphemy! CEOs of the current age aren’t motivated to succeed as they once were. In most cases their contracts guarantee massive salaries and generous severances, win or lose, so the daily objective has more to do with maintaining the status quo than with taking risks. Stockholders like money, but they abhor risk. Today’s risk takers aren’t occupying offices on Wall Street, but are found in America’s garages and incubators, or overseas in places like South Korea, Singapore, and India.

Strouse believes America’s economy is waiting for a new Morgan to step forward and suggests Warren Buffet might be that man. I disagree. Financially, Buffet’s as smart as they come, but he’s notoriously penurious and, apart from a shrewd accumulation of discounted shares, he isn’t likely to wager Berkshire Hathaway‘s value to spur confidence in the markets. He’ll spend words to bolster confidence, but he won’t ask his shareholders to squirm anymore than they already are.

Sadly, I don’t think this century has a J.P. Morgan. So, while the economic floodwaters continue to rise, we can’t afford to wait for a miracle. Instead, it’s time for Americans to revive their collective confidence and do as individuals collectively what we seem to be waiting for someone else to do for us: Get in the boat and help row.

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