[Editor’s Note: This article from the Economic Prism has been shared in previous years in celebration of Independence Day. The themes it presents grow increasingly relevant as time passes. We are excited to present it with minor updates. Enjoy!]
Time and Place
As summer days stretch long and hot in the Northern Hemisphere, true American patriots rally with unwavering spirit, waving the red, white, and blue. On July 4th, the courageous stand firm, accepting federal holiday pay as a reminder of their independence and self-determination. Characterized by rugged individualism and a resolve for freedom, they gather along sandy shores, celebrating American Independence.
Descendants of freedom-loving pioneers, like Andrew Jackson, come together for barbecues and friendly games, enjoying hot dogs and the refreshing taste of beverages made from fermented grains. As the sun sets and stars begin to twinkle, the night erupts with cheers and awe at the splendor of fireworks lighting up the sky.
Such celebrations reinforce that, even amid an expansive government, there are still moments to honor the principles of representative self-governance. All are welcome to join, provided their vehicles are registered, taxes are paid, and they have the necessary documentation, which now may even include updated vaccination records.
Freedom. Liberty. Independence. A government of limited scope. Sound currency. Rights to private property. The rule of law. An admirable populace. Avoidance of foreign conflicts. Rafting on the majestic Mississippi River. Listening to Creedence Clearwater Revival. Maintaining healthy lifestyles.
Unfortunately, these ideals have become less prominent over the past century, fading from everyday life like the once-common horse-drawn plow. The republic began its decline long before Elvis took his final bow. Washington’s influence now stretches across the globe, ensnaring those who wish to evade its reach.
But why tarnish this festive occasion with grim reality?
Instead, let’s reflect on a time not so long ago—a more carefree era before the emergence of the Department of Homeland Security, Facebook, Google, iPhones, and contact tracers that monitor our every action. A time when freedom felt more authentic and currency devaluation was less apparent.
Creative Destruction
Political, commercial, and cultural shifts often reach boiling points seemingly without warning, quickly leading to revolutions that dissipate the status quo. In retrospect, we recognize that the simmering tensions had been brewing for years, if not decades, prior to these eruptions.
In the early 1990s, Steve Rocco, a determined freestyle skater from Hermosa Beach, launched a shockwave throughout the corporate skateboard world. Armed with a modest budget and loans from a risky financier named Kirby, Rocco swiftly challenged and overthrew the dominant skate companies that had become complacent and outdated.
Exemplifying Joseph Schumpeter’s concept of the “gale of creative destruction,” Rocco transformed both the industry and its underlying culture.
Once thriving on the popularity of vert ramp skating in the late 1980s, the major skate companies had rendered the sport inaccessible to budding skaters. To protect their investments in professional athletes—many of whom had stagnated—the corporations acted as gatekeepers, hindering fresh talent from entering the scene.
Through innovative designs, tireless dedication, and clever parody, Rocco unveiled the elitism that had taken hold of the industry. Almost overnight, the products of the old guard were deemed obsolete, their brands lost their appeal, and their sponsored pros fell short in popularity. Sales for traditional skate companies plummeted dramatically.
With street skating gaining momentum, accessible to any child with a board, it quickly overshadowed vert skating as the heart of the sport. Rocco’s brand, World Industries, seized this opportunity like no other.
Breaching the Great Wall
By late 1998, Rocco and his five associates sold a 70 percent stake in World Industries to the private equity group, SPC, valuing the company at $29 million. Rocco retired to Malibu before reaching his 40s but retained financial interests in the company.
The documentary, The Man Who Souled the World, captures his journey. In less than 90 minutes, it imparts more entrepreneurial wisdom than any conventional business school could offer.
Rocco’s creative upheaval within the skateboard industry paved the way for countless new, skater-owned businesses. This momentum unleashed an incredible surge of enthusiasm, creativity, and youthful vigor, radically transforming the industry.
For instance, Plan B, founded in 1991 by the late Mike Ternasky, emerged through a distribution agreement with World Industries. Ternasky aimed to cultivate a super team, sponsoring elite skaters and pushing the boundaries of what was physically possible.
Skaters like Matt Hensley, Rodney Mullen, Danny Way, Colin McKay, Rick Howard, Mike Carroll, and Pat Duffy advanced the sport in ways previously thought unimaginable.
Their groundbreaking tricks and dynamic performances truly captured the spirit of innovation, exemplified on July 9, 2005, when Danny Way, after a painful fall the previous day, completed a massive 360-degree air over the Great Wall of China.
It had been nearly a millennium since Genghis Khan successfully breached the Great Wall in 1216 AD.
Red, White, and Blue
So, what’s the significance of all this? What do Steve Rocco, World Industries, Danny Way, and the skateboard industry have to do with Independence Day and the essential colors of our flag?
Surprisingly, the connection between this narrative and American independence runs far deeper than summer barbecues and drinks at the beach.
The U.S. economy, mirrored by the global economy, has reached a critical juncture. There’s no turning back. It’s palpable; it’s pervasive—seen, felt, heard, and even tasted.
Currently, government planners and strategists are queuing up their clichéd responses, ready to deploy them at the peak of panic. Proposals for economic patriotism, universal basic income, modern monetary theory, trade conflicts, total currency collapse, travel bans, digital currencies from central banks, social credit ratings, potential global conflicts, and increased governmental control threaten our cherished freedoms.
However, these initiatives will hardly solve the impending challenges. In fact, while catering to mass populism, they risk exacerbating the situation.
In the spirit of American freedom and independence, channel your inner Rocco. Innovate fearlessly and create according to your own terms.
Though a centralized government may attempt to seize every ounce of your income, with a stroke of luck, you might spark your own “gale of creative destruction,” dismantling the status quo like a whirlwind.
Optimistic thinking? Perhaps. However, on America’s Independence Day, circa 2024, it’s an aspiration worth pursuing.
[Editor’s note: It’s truly remarkable how just a few thoughtful decisions can lead to wealth that changes lives. At this moment, I am preparing for another such decision. >> I’d be delighted to share how you can do the same.]
Sincerely,
MN Gordon
for Economic Prism
