H. Ross Perot: A Study in Contrasts

Al Jacobs

The proclamation recently appearing on the internet is obviously meant to be provocative: “Ross Perot, self-made billionaire, born into poverty, dies.” The article thereafter reveals little of consequence. As nearly as I’ve determined this past decade or so, information disclosed in the many online stories, reports and exposés overloading our computers and smart phones are designed to do little more than excite, criticize or titillate. Rarely is a subject presented in such a fashion anything meaningful emerges. It’s a pity in this case, as the remarkable life of H. Ross Perot deserves to be fully explored.

To begin with, Ross Perot was not born into poverty – if, by poverty, we’re referring to his parents’ financial circumstances when, in 1930, he appeared at the start of the Great Depression. His father, Gabriel, functioned as a cotton broker; his mother, Lulu Mae, a secretary for a small lumber company. As a family they survived the depression reasonably well through hard work and by managing their money carefully.

The fact young Ross sold garden seeds and delivered newspapers before the age of ten doesn’t mark him as financially deprived, any more than did my job of mowing lawns and shoveling snow off Minnesota sidewalks at the same age. This is simply how our generation developed a respect, early on, for earning our way in a world where remunerative accomplishment truly mattered.

But of even greater significance, the phrase “born into poverty” often masks a far more insidious interpretation. It’s meant to imply societal as well as financial decadence attaching to what we refer to as poverty-stricken individuals. It’s my belief, however, the term poverty relates in no way to financial status. I’m convinced if you’re simply without money, you’re broke – a financial condition. Poverty, on the other hand, is a mental condition. I admit to having been broke – flat broke – many times in my life … but regardless of whether or not I had a single cent in my pocket, I’ve never been poor.

A true perception of Perot’s abilities – and limitations – can be gained by observing his performance during his years as a midshipman at the U.S. Naval Academy at Annapolis, Maryland. As a member of the Class of 1953, he spent the period from June 1949 through June 1953 rigorously engaged in his assigned activities … and rigorous they were. Standing only 5’ 6” ranked him as among the shortest allowed to be admitted. Nonetheless he made his presence known. He served for two of those years as the 1953 class president – a distinct honor. And an even greater distinction in his senior year, standing sixth from the top in aptitude in a class of 925. Because of this he concluded his first class year as the First Battalion Commander – a most prestigious accomplishment.

It must be acknowledged Perot received criticism on more than one occasion for his overall class standing of 453rd during his four years at the academy, placing him just slightly in the bottom half of his class. Admittedly, his standing during his final year, within the bottom quarter of his classes in Seamanship & Navigation, Ordinance & Gunnery, Marine Engineering and Electrical Engineering, offers ample evidence he did not qualify as highly intellectual. However true this may be, it in no way alters the reality he was remarkably smart. How can this be? Let me explain.

Intellectual and smart are not synonymous. Intelligence is essentially the brain’s ability to cognitively manipulate information – fundamentally genetic in nature. If you aspire to become a university professor of mathematics, physics, or chemistry, you must possess an ample share of intellect, or you’ll never make past your sophomore year. I’ve known many true geniuses for whom differential calculus, as well as the intricacies of base-catalyzed cleavage of epoxides, proved to be a breeze.

However, many of these same persons would have no idea whatever how neighbors might react when informed your massive oak tree just fell on the roof of their house.

Being smart, on the other hand, brings into play an entirely different set of talents. These demand the ability to size up circumstances and then figure out how to make the most of things as they actually exist. Above all, they require an astute meshing of perception, experience, and attitude to devise a plan of action … and when necessary, an alternative plan of action if the initial one doesn’t work quite as intended. These talents Ross Perot possessed in abundance.

You might now ask that I give you an example of how he actually put this sort of smartness into practice. The following story will give you a fine view of just how well a problem can be resolved when it’s handled aggressively and effectively.

In the late 1970s, shortly before the revolutionary upheaval in Iran, Ross Perot’s company, Electronic Data Systems (EDS), provided computer installation services to the Iranian government. In December 1978, the firm ceased operations because Iran failed to pay $5 million it owed for completed work. When Perot announced he intended to withdraw his employees from the country, the Iranian government began arresting them to be held as hostages. Although most managed to find refuge in the American embassy, two engineers from Dallas, William Gaylord and Paul Chiapparone, were jailed on Dec. 28, and promptly charged with bribery.

The Iranian government announced they’d free the two employees in exchange for a ransom payment in the amount of $12.7 million, with the money to be paid through Iranian banks. Although EDS agreed to pay the ransom, by this time the Iranian banks were unstable and unable to transfer the money.

To further complicate the matter, all EDS employees became a part of Shah Mohammad Reza Pahlavi’s investigation into corruption involving his ministers. And as the final straw, the Carter administration refused to permit the U.S. government to raise a finger to help.

Perot took the matter into his hands. He personally visited the prison to assure the two he’d get them out. He then recruited retired U.S. Army Special Forces Colonel Arthur “Bull” Simons to lead a commando raid on the prison. Several days later the two engineers walked free as mobs stormed the prison. Simon’s men then sneaked both out of the country and into Turkey – concluding the event as only a crafty conniver might be able.

How might a lesser person approach such a dilemma? Much the way President Carter bumbled the freeing of 52 American hostages from the U.S. Embassy in Tehran – who had been held captive from November 4, 1979, to January 20, 1981, by Iranian college students, supported by the Iranian leader Ayatollah Khomeini. For the first five months the administration engaged in mostly fruitless negotiations.

By April 1980, a military rescue plan was formulated by Secretary of State Cyrus Vance, National Security Advisor Zbigniew Brzeziński, and Deputy Secretary of State Warren Christopher, wherein they called each other names and Vance threatened to resign. Whether the president had involvement is uncertain.

On April 24, 1980, with that the kickoff, the rescue attempt proceeded as expected: dust storms ignored, helicopters unserviceable, security compromised, vessel collision killing eight servicemen, radar unavailable, and the operation aborted by the president. A second rescue attempt, contemplated in October, was cancelled after Carter lost his bid for reelection.

A few final thoughts: (1) We cannot blame Carter’s miserable performance on a lack of intellect. He’s bright, having stood in the top 10 percent in his 1947 Naval Academy Class – 61st out of 821 graduates. (2) We dare not write off eager and assertive persons merely because their school performance is less than stellar; intellect is but a single facet in determining the value of each of us. (3) The true worth of an individual is the composite of his or her talents.

Without a doubt, Henry Ross Perot was a truly remarkable man who lived an inspired life, and who gave far more than he received.

 

Al Jacobs, a professional investor for nearly a half-century, issues weekly financial articles in which he shares his financial knowledge and experience. Al can be contacted at al@abjacobs.com.

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