Des Moines’ animal spirits
As we’re writing this editorial, news has just broken that J.P. Morgan Chase had agreed to buy Bank One for $58 billion in stock.
Set aside for a moment the personal drama of James Dimon, the one-time heir to the Citigroup throne who was cast out in 1998 but now returns to Wall Street as president of a rival to the house he helped Sanford Weill build. The story we want to focus on is the simple drive by some businesses to take risks to help them better compete. It’s what British economist John Maynard Keynes called “the animal spirits of capitalism.” The J.P. Morgan Chase/Bank One deal – the largest banking-related acquisition in five years – certainly fits the bill.
Closer to home, we’ve taken note of – and cheer – recent moves by Pioneer Hi-Bred International Inc. and Meredith Corp., among others, as doing their part to advance their companies in a changing world economy.
In Meredith’s case, the publishing giant has been making concerted efforts over the past year to court Hispanic readers and viewers for its magazines and television stations. In December 2002, it purchased American Baby Group, gaining magazines targeted at Spanish speakers.
Last week, it announced the creation of a new position called Hispanic Ventures and hired Ruth Gaviria, a Tulane University graduate who was named one of Advertising Age’s top100 marketers in 2000, to run it. Gaviria started her career with Procter and Gamble and served most recently as director of marketing for Time Inc.’s People En Espanol.
At Pioneer, the world’s No. 1 maker of genetically modified seeds for corn and soybeans, the role of president passed last week to Dean Oestreich, who worked his way through the company’s research and business ranks. In 1999, he served as director for Pioneer’s operations in Africa, the Middle East and Asia. In 2001, he took responsibility for the company’s global production.
Pioneer began a venture in China in 1998, and in October its Shandong Denghai Pioneer Seed Co. joint venture opened its first manufacturing plant there.
Both Meredith and Pioneer are making smart long-term moves. According to data from the most recent U.S. Census, Hispanics have overtaken blacks as the largest minority group in the nation. It’s a population that continues to grow in both size and wealth.
Though Oestreich took pains in an interview last week with the Business Record to explain that his promotion didn’t signal any new focus on China or Asia in general (please see related story on Page 10), having an Asian specialist in that position will only help Pioneer and its parent, DuPont Co., as it works to expand in the region. China and India alone account for slightly more than a third of the world’s population. China’s economy is growing rapidly.
It is moves like these that will ensure Central Iowa businesses remain relevant into the 21st century.