Wednesday, June 26, 2019
Seven Skinny Cows: John Wilder
John Wilder was not the typical middle manager in a large, American corporation.
His dad was a cop in a medium-sized town. John went to a second-tier state university and majored in history. Even then there were many academic advisers who gave the rotten advice “Follow your passions.”
Graduating with student debt the equivalent of a new car, John found that his degree gave him exactly zero incremental hiring advantage over a new high-school graduate.
Determined to not make the same mistake twice, he did some research and chose a Master’s program where jobs were both abundant and lucrative. His research suggested that the straightest line between where he was and where he wanted to be was to get a Master’s degree in Business Administration. His belated research also revealed that graduates with an MBA from any state’s flagship university commanded starting wages 50% higher than graduates from any of the me-too universities.
As the son of a city employee, he had almost no idea what “Business” meant. He knew “Finance” had something to do with accounting and he didn’t want to sit behind a computer all day and do other people’s taxes. He remembered his dad going nuts on April 14th every year and he wanted nothing to do with “Finance”.
He opted for Marketing. He though his flair for writing bullshit would make that a cake-walk.
And it was a cake-walk until the section of Statistics for Business Majors he was scheduled for was cancelled and the other sections had already filled up. He had a choice, take a different statistics class or spend another half year in school. He opted for Statistics for STEM Majors.
The class thoroughly kicked his ass. He would have failed except for the Chem major he sat next to. She was cute and quiet. Her name was Sam.
She dragged him kicking and screaming through that class. And then the next one. Sometime during John’s academic Baatan Death March a switch flipped in his head. He saw the power of statistics and he fell in love with Sam.
He graduated in the upper-middle of his class. He thought that his chances for a job were decent. He was surprised to find that his services were avidly sought by insurance companies. They were impressed that he took “real” statistics classes rather than the watered down pap most MBAs took. Who knew?
His love of history informed him that Black Swan events are about a once-a-century events for the dominant culture. After a hundred years, all of the people who experienced the previous Black Swan were dead. Dominant cultures are a lightening rod for envy and chaos.
John had little success convincing his company to pad the rates for those Black Swan events. They would point to the paucity of wars and pandemics and famines and debauched currencies and say that the statistics did not work for sparse data. His argument that Black Swans could be aggregated and then there were enough data points was met with silence. He was informed, “Things are different now.”
John and Sam found themselves swimming in money.
Sam’s needs were simple. She did not crave cruises or spending time in all-inclusive resorts. Nor did she want a fancy BMW or a prestige house address. She bought a two year old Impala and drove it for five years before buying another. They had lived in the same blue-collar neighborhood for the last twenty-five years. She could have bought any or all of the prestige artifacts that define affluent people on her salary and bonuses. Her team had hit a home-run with a single drug a decade ago and had several Chemotherapy synergizing drugs that had come within one trial of being approved
She could have bought those things but felt no need.
John created his own insurance plan for the dreaded Black Swan event.
He rejected the billionaire plan of jetting to Fiji or Australia or Alaska. Moving is always a shock and why would people in Fiji want another mouth to feed, especially when that mouth was not family? And Australia or Alaska, he never understood the attraction of moving to an austere environment where the deer had to have legs that were six feet long to move through the snow or where every snake, bug and plant was toxic and could kill you.
Rather, he started buying farmland in Eaton and Ingham counties.
Ebola bankrupted his company. Life insurance is predicated on the idea that there will never be more than 1.4% of the population dying any given year.
The family bunkered up.
While holed up, John made an intensive study of England before, during and after the Black Death wiped out a third of the population. John chose England because the event had been extensively documented. History does not repeat itself but John was convinced that history rhymed.
John’s take away was that labor would be in short supply, wages would go up and that the price of most commodities would deflate.
Another thing John gleaned before the internet went down was that livestock became the crop-of-choice after depopulating events. Growing grain and other food crops is labor intensive. A single man and a dog can manage a flock of six hundred sheep, about the number that a quarter of a square-mile of prime, mid-Western corn land could support. Without tractors or domesticated animals to pull implements, it would take eighty adults to farm that same amount of land.
Furthermore, it takes thirty years to double the number of “workers” in the population. Under ideal conditions the population doubles in twenty years but the majority of the increase is under ten years of age and not able to do heavy, ag work.
On the other hand, a flock of sheep can increase by 60%-to-70% every year. A flock of six ewes can grow to sixty in five years and 600 in ten, 6000 in fourteen and 6,000,000 in twenty-three years.
Unless John was willing to let his farmland revert to brush, the only real option was to become a shepherd.
The other thing pushing John in that direction was that fabric made from synthetic fibers was soon going to become nothing but a mythic memory. Cotton does not grow in Michigan which left hemp and wool as the only two options.
Fortunately, John had often worked from his home office. It was well stocked with toner cartridges for the laser printer and 24 pound, acid-free paper. John downloaded books on agriculture, animal breeding and sheep. Not trusting that his laptop would run forever, John printed them out and put them in three ring binders.
The first challenge for John was going to be to find seed-stock. Few commercial sheep farmers in Michigan raised “wool” sheep because the market had placed a large premium on “meat” breeds.