Forbes publisher says Kodak failed because of Rochester location, but wouldn’t blame environment for a person’s failure

Rich Karlgaard’s publication, Forbes, has long glorified the lone captain of industry who shapes the destiny of companies and nations. The flip side of its great man theory is the belief that people are responsible for their own fates and should not depend on government for handouts. Before and during Karlgaard’s rein as Forbes’ publisher, the publication has pursued both the great man and the no entitlements themes with a vengeance.

Yet in a Wall Street Journal opinion piece over the weekend, Karlgaard misapplies a chic theory of early human history to blame the failure of Kodak on its Rochester location.  It’s not the great, or in this case, not-so-great, man who brought Kodak down, it was the fact that Rochester didn‘t have enough creative buzz and talented people to help Kodak make the transition from film to digital picture-taking.

Let’s start with the facts of the article.  In documenting Kodak’s decline, Karlgaard makes a strong case that Kodak died of its own short-term greed.  Despite an early lead in digital technology, it preferred to sell the cash cow of film, which gave its digital competitors time to build an enormous market lead. That’s the story Karlgaard tells, but he then uses the old rhetorical device of not matching the facts to the conclusion.

To demonstrate that it was the backwater qualities of Rochester and not the stupidity of management that sunk Kodak, Karlgaard mentions a few other cases —paltry anecdotal evidence that is also contradictory since it forces him to label Boston as another backwater. In addition, Karlgaard forgets that while Kodak had its headquarters in Rochester, it had research and manufacturing facilities all over the world.

Although Karlgaard details the stupid tricks of the management of Kodak, Digital Equipment, Data General and Wang, he blames the places where these companies were headquartered.  Some amorphous quality he calls “innovation and adaptation” resides not in individuals or the corporate cultures of companies, but in the region.  Some regions got it and some regions don’t. This kind of argument borders on racism, because positive and negative qualities are falsely attributed to a population.

Karlgaard presents no evidence, only his assertion that Rochester failed Kodak as a location for a company more than Kodak failed Rochester through the stupidity of its senior management.  I’m guessing that Karlgaard or one of his ghost writers recently has stumbled upon a recent theory of early human history that proposes that European civilization and its American extension dominate the world and that the reason for it is the accident of geography.  This theory, popularized by Ian Morris in his Why the West Rules—For Now, is still in dispute, as is the idea that the West has mostly dominated the world stage throughout the ages.  Moreover, Morris and others are talking about the change geography compels over hundreds of years among populations of millions of individual entities in locations defined as much larger than a single metropolitan area.  Applying the idea to one company over a 40-year period distorts whatever validity this theory may have.

With or without this new scientific idea, Karlgaard makes one of the most specious arguments I have read in the news media in a long time. Behind it is the odious notion that business folk operate on a different standard from others.  Even if she/he made mistakes, the business master of the universe can’t be at fault, so it must be her/his environment.  Unspoken are the many times that Karlgaard and the staff he hires and fires have rejected the environment argument for the failures of the poor or disadvantaged.

The double standard is the unspoken premise behind many rightwing ideas.  For example, why is it that conservatives always argue that corporations and industries don’t need regulation and inspections to keep employees and the public safe? Where did business owners and executives obtain such high ethics that there aren’t even a few rotten apples in the barrel? Meanwhile, the same conservatives argue for limiting the length of unemployment benefits because regular working stiffs—not the dedicated and altruistic business owner—can’t be trusted and will not look for a job if the steady check is coming in. The same conservatives want to impose a greater paperwork burden to get food stamps and Medicaid and to register to vote, even as they bemoan paperwork for businesses.

Karlgaard implies the same argument in his Wall Street Journal piece.  It couldn’t possibly be the captain of industry, so it must be the rough seas in the home port.



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