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Perishable Pundit
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Produce Business

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American Food & Ag Exporter

Cheese Connoisseur



Tesco Uses Poor Economy As Excuse For Fresh & Easy Pullback

Every time there is a hurricane or natural disaster, there are people and businesses that are horribly impacted, but there are also plenty of people who use the event as an excuse for their own non-performance. So a hurricane hits the coast in North Carolina and that somehow explains why businesses 150 miles to the west didn’t mail out checks that had been promised.

We thought of this as we read news reports of Tesco’s decision to slow its US expansion. Steve Hawkes is a sharp guy who writes for The Times of London out of Los Angeles and he recently wrote a great piece. Our only problem with the story is that, most likely, someone back in London chose the headline Meltdown puts the Brakes on Tesco’s US Dream, which is accepting at face value the explanation given by Tim Mason, Chief Executive Officer of Fresh & Easy.

We have been writing about Tesco’s journey to America from the very start, and we would say the explanation makes absolutely no sense and that Tesco is using the economic situation to cover up the fact that the concept is troubled and its execution has been problematic. Here is an excerpt from the article:

Tim Mason, chief executive of Fresh & Easy, said yesterday that plans for the chain to expand into northern California could be put on hold because of the recession gripping the United States…

Tesco had hoped to have 200 Fresh & Easy stores, modeled on its Tesco Express format, operating across southern California, Arizona and Nevada by February next year. Mr. Mason said that now he hoped to reach this target by next November….

The group has talked of having 1,000 stores on the West Coast, stretching from Seattle to San Diego. However, a move into northern California would require huge capital investment because of the need for a new distribution centre.

Mr Mason said: “The industry is in a very different place than when we came out and did the feasibility research three years ago. Then the US consumer confidence index was at the highest level it had ever been. In October the US consumer confidence index was the lowest it has been since 1967, so it’s a big change. We will still open stores every week, but it’s prudent to slow things down a bit.

“There’s a big cost step for us when we open up northern California and we can be quite flexible about when we do that. As things get to a point that we like how it’s all coming together, we like the way the stores are growing into the second year, then we can accelerate. If the economy takes a turn for the worst, it would be unwise to accelerate.” …

There is no doubt that the economic situation has changed, but it does that. There are economic cycles, upturns and downturns, etc. It is inconceivable that Tesco entered the US market expecting that there would never be a recession. What if Tesco had started building a second distribution center and then the recession came? Would it just close up?

Note what isn’t being said: The issue is not that Tesco cannot raise the money to expand the division. It is not even that the world is offering such compelling opportunities elsewhere that Tesco prefers to invest elsewhere. It is that the stores right now are not performing sufficiently well to justify the investment required to support them:

“As things get to a point that we like how it’s all coming together, we like the way the stores are growing into the second year, then we can accelerate…”

In other words if Fresh & Easy maintains current sales and profits, it is a loser and Tesco doesn’t want to pour good money after bad. Not only that, but Tesco is not confident that year two will be sufficiently better to justify investing more in the concept.

Now this has virtually nothing to do with the economy. Yes, many retailers are struggling but those are typically retailers of discretionary products or high-end retailers of food, such as Marks & Spencer in the UK and Whole Foods in the US.

Wal-Mart’s CEO Lee Scott is going around crowing:

CEO and President Lee Scott recently told analysts “This is Wal–Mart time” at the company’s two day investment meeting in Bentonville. “It is clear in this environment that the customer is more cautious and more thoughtful about what they buy and they’re more thoughtful about when they buy it,” but that because the low price retailer has fared so well in previous times of economic downturn, “We see this as an opportunity to widen our moat.”

Since executives for Fresh & Easy have continuously claimed both that it is cheaper than American supermarket chains and that its private label products have won phenomenal acceptance, the idea that the recession is causing Fresh & Easy to pull back makes no sense. The poor economy should be helping a chain that is cheaper than everyone and has well accepted high quality private label products.

Part of the problem may be that these claims are exaggerations. For example, when Pundit sister publication PRODUCE BUSINESS did its price comparison study on produce prices in Los Angeles, Fresh & Easy didn’t win. In fact it was beaten not only by Wal-Mart but by Stater Bros. and Vons — it was only traditionally pricey Ralph’s that it managed to beat.

There are, however, broader problems. The Times article continues:

Mr Mason conceded yesterday that the chain had found it harder than expected to crack America, not only because of the more mature nature of the market — “we are not filling a vacuum” — but also because of the economic slowdown.

Fresh & Easy has been unable to open some stores in Phoenix and Las Vegas because property developers decided to shelve plans for certain sites.

The loss of a few locations because developers abandoned plans is inconsequential compared to the thousands of sites now available because of the downturn in the economy. When it comes to real estate, the rise in vacancies is a big win for Tesco.

The phrase about “not filling a vacuum” is getting closer to the point. When Tesco announced its plans to expand to the US, many thought it invincible because it had been successful in most of its overseas forays. These efforts, though, were typically in markets such as Poland or Thailand without a well developed western food retailing scene.

It is not as if Tesco opened new stores in France, Germany, and the Netherlands and showed this enormous ability to beat its competitors. It really was good at finding places where it could “fill a vacuum.”

Now in the US, what Tesco is really finding is that small stores geared toward the middle of the market — that is, not discount, like Aldi, or foodie, like Trader Joe’s — are a skinny opportunity to begin with. It also is learning that whatever innovation it might bring to the market will be quickly vetted and, if worthwhile, copied by world — class competitors operating in their home market — Wal-Mart, Safeway, Kroger, Supervalu, Costco, Whole Foods, etc.

In other words — as Lee Scott’s comments allude to — it is not enough to simply be good; one must have unique competitive advantages that create a “moat” to insulate one from effective competition. The reason the Fresh & Easy idea was always problematic was there were only two options.

Either it would be very successful, in which case every retailer in America would open small footprint stores and have them open in Miami, Cincinnati, New York and Boston long before Tesco got there — leaving Tesco with a small beachhead in the west. The other option would be that this small scale store was not a real market. In either case, it would not be a big win.

One senses that reality is starting to seep in. When the Fresh & Easy concept was opening, Tim Mason struck down all hesitations by repeating the Tesco mantra about Fresh & Easy:

“This is a launch, not a trial,” said Mason, in one of the oft-repeated mantras spouted by the ruthlessly on-message Tesco team, all of them clad in LA-casual jeans.

Now, in The Times article, Tim Mason sounds contemplative, almost plaintive:

Mr Mason insisted that critics doubting the potential of Fresh & Easy would be proved wrong, adding that to go from no stores to 100 in a year was an “exceptional” achievement.

“We are absolutely thrilled with the customer response from those loyalists that have got it, and really loved what we do,” he said. “What retailer has better staff, better product quality and delighted customers and doesn’t make it?”

Opening 100 stores in a year is an achievement and it should be acknowledged. Though it should also be noted that Wal-Mart has been doing far more than that and with each store being 20 times the size for well over a decade. More importantly, opening stores is a matter of logistics; it speaks nothing to the success or failure of the business proposition. It just means Tesco had enough money to build stores and enough capabilities in real estate and construction to secure leases and build-out structures. It doesn’t even mean that the locations selected were good.

The truth is that Tim Mason’s reference to “loyalists” is telling. If Fresh & Easy had enough “delighted customers” that were willing to buy enough volume at a high enough margin to produce reasonable returns, Tesco would be pushing on the pedal to open more distribution centers and more stores. Its decision to sit tight is an outgrowth of the fact that it is losing money and doesn’t know how to change that. Blaming this problem on general economic conditions is an easy out.

It is sitting, waiting, trying a few changes, but, unwilling to fundamentally change the concept as we have advised. It sits hoping that time itself will right what is wrong.

Alas, surely all the British executives at Tesco must be aware, we had this war once and the loyalists lost. It is unlikely to turn out better for Britain’s largest retailer this time around.




Russia Stalls EU Exports With Tough Pesticide Residue Stance

Freshfel Europe — which describes itself as “…the European Fresh Produce Association, representing the interests of importers, exporters, wholesalers, distributors and retailers of fresh fruits and vegetables in Europe and beyond…” — came out with a strong statement opposing a new Russian requirement:

FRESHFEL EUROPE CONDEMNS RUSSIAN PLANS TO INTRODUCE SAFETY CERTIFICATES FOR SELECTED FRESH PRODUCE ORIGINATING IN THE EU

Freshfel Europe is alarmed by the information that the Russian Federal Service for Veterinary and Phytosanitary Surveillance (Rosselkhoznadzor) will require, [as of November 15], safety certificates for several products originating in the EU. Freshfel regrets this move, which takes place at the moment when Russia and the EU agreed to hold technical discussions on Maximum Residue Level (MRL) settings to align Russian rules to international practices. This decision is also contradictory to the outcome of bilateral discussions held by Russia with the authorities of several Member States.

According to Rosselkhoznadzor, a safety certificate will be required as of [November 15] for the following products and origins:

GREECE — grapes, peaches, nectarines, oranges and mandarins

SPAIN — peaches, nectarines, mandarins, grapefruits, pears and oranges

LATVIA — all products

THE NETHERLANDS — tomatoes, apples, carrots, beetroots and cabbages

HUNGARY — apples, celery, cabbages and plums

ITALY — grapes

[Editor’s Note: This release has been revised to account for recent changes Russia made in the date for enforcing requirements as well as the products and countries included.]

This measure is putting in jeopardy the exports of EU-quality produce, which today amount to close to 1.3 million tons. EU fruit and vegetables are grown according to strict EU safety and environmental requirements, and the proposed measures threaten to prevent Russian consumers from a wide range of EU quality produce. Freshfel would like to highlight that the current developments are resulting from inadequate MRLs set by the Russian legislation, which are not in line with international practices set by CODEX. Freshfel laments the move from Russia, as at a recent meeting between the EU and Russia, it was agreed to further discuss the inadequacy of the Russian MRL with a view to bringing them into line with international best practices.

Freshfel further criticizes the short term of implementation of the measures, not allowing exporters adequate time to cope with the new requirements. This is likely therefore to lead to the severe disruption of trade flows and will hinder current arrangements between suppliers and Russian importers. Furthermore, the framework of operation of the safety certificate is not clear as long as discrepancies of interpretation between the EU and Russia exist over the terms of the Memorandum. It also remains unclear on which basis laboratory analysis should be undertaken. Freshfel is committed to work with the European Commission to clarify this point and to propose to Russia alternative MRLs compatible with the terms of the Memorandum.

The measures implemented by Russia impose a burden across the whole sector on the basis of limited and questionable problems, and Freshfel considers these measures to be excessive and lacking in proportionality. On the contrary, the new measures mean that Russian consumers will be deprived from EU-quality produce by a situation which does not place the health of Russian consumers at risk.

European exporters are accustomed to complying with strict safety standards and are ready to adjust their practices in order to cope with specific customer requirements demanded by the market as long as these requirements are workable, reasonable and consistent with international trade policy. The move by Russia is a negative development at a moment where Russia is in negotiations to join the WTO.

What could the Russians be looking to achieve by this measure? We asked Pundit Investigator and Special Projects Editor Mira Slott to find out more.

Frederic Rosseneu
Secretariat, Freshfel Europe
Brussels, Belgium

Q: Are Russia’s actions against the European produce trade purely political, and/or what is the context? Are other food products facing similar restrictions?

A: The whole thing seems quite political if you look at all the decisions that they’re based on good science and the lack of science supporting this decision. Having said that, we’re not the only sector that had to deal with these problems. Plant products — flowers and live plants — have been subjected, and certainly on meat there were very big problems one to two years ago, which were finally settled.

Another product last week was fish imports subject to export controls. It means each company that wishes to export fish needs clearance by Russian inspectors on site. We witnessed the same requirement with meat, where each meat consignment needs a certificate signed by Russia from each member state. Luckily we’re not that far yet with fruits and vegetables, but it is generally feared we’re moving to such a system.

Q: Why is Russia so aggressive on this front?

A: We’re not the only ones affected; in part this is all due to an economic power play because of the economic revival in Russia, and to make it clear to Europeans and other countries that Russia is no longer a garbage market, no longer a trash bin of the world, which is a legitimate request.

Q: What are the requirements exactly and how did they escalate?

A: A signed memorandum in March of this year between the EU and Russian Federation agreed as of the first of July that all consignments of plant products to Russia must be accompanied by pesticide documents. The memorandum is only on pesticides and nitrates. If exporting tomatoes to Russia, for example, documentation would need to show which plant protection products were used and the time of last application. It has some problems for re-exports but this is manageable. But supposedly based on continued infractions with Russian laws, Russia threatened in August to implement a requirement of safety certificates for different products originating in the EU. Now Russia has declared it is following through with its threat.

Q: Doesn’t EU law already require strict pesticide regulatory measures, more stringent than in the U.S.?

A: In Europe, Maximum Residue Limits (MRLs) are by far among the lowest in the world. And the range of pesticides is also quite small compared to other countries in the world. This is the first time the EU is dealing with exports to a third-world country, where pesticide requirements are stricter than the EU. This is not a problem because any country has the right to impose its own restrictions. But in Russia, through the Federal Service for Veterinary and Phytosanitary Surveillance (Rosselkhoznadzor), is going much further than other countries. Residue limits are far below what we know in the EU. A lot of cases are not detectable by laboratories.

Q: What do you mean? If testing can’t determine whether companies are actually meeting the Russian Federation’s requirements, how can authorities measure compliance?

A: If in testing you only looked for that one particular product you might detect it, but most laboratories test 300 pesticides at a time, with accuracy of 0.01 milligrams per kilogram.

For sure, this program is problematic to almost all countries exporting to Russia. We respect a country’s own legislation but it also must be in accordance with rules set with WTO. From a general perspective, we were working on solutions with the European Commission; solutions acceptable to both us and the Russians. But all of a sudden Russia decided to make its threat a reality and require safety certificates for EU products.

Q: It sounds like you were caught by surprise.

A: We have no concrete measure why Russia went from threatening to implementing the threat. We first knew of the threat to implement safety certificates in August. Russia argued it was due to continued infringement of their law, but in the majority of cases, this was not so because Russia didn’t have clearly defined limitations for those pesticides.

Q: From a scientific perspective, is it possible to produce some of the products in question with lower residue levels?

A: We don’t have any other alternatives for those products. Some products leave residues. Either you accept this or you don’t have apples. For certain residue levels, the requirements are not achievable for certain uses; it’s as simple as that. It’s not that we weren’t willing to find solutions

We first knew of the threat in August, even if it was not based on true infringement of law. The recent change occurred in October. Russian authorities said we warned you in August, and now we’re going to do it. There was no indication or reason for this. We were under the impression we were having good visits with the Russian authorities. Russia and the EU had agreed to hold technical discussions on MRLs to align Russian rules to international practices. Now in November the new requirements are set to be enforced.

Q: What happens now?

A: For certain countries which Russia says are main offenders, they will be subjected to the new regulations for listed vegetables. [Editor’s note: see list in the announcement above.] Any consignment containing the products will require not only a pesticide certificate but a safety certificate, residue tests from a lab showing results and also a declaration it complies with Russian legislation.

Q: What impact will this have on industry? Will certain countries feel the heat more than others?

A: For now, a lot of exporters have put product at minimum or on hold because they don’t know what will happen if consignments will actually pass the Russian border.

A lab test for a product on average costs in dollars nearly $350 or $400 for each consignment, so the bill becomes quite considerable. But also, there is great uncertainty because we don’t know which residue limits we need to comply with. We are not able to know if it will comply with Russian legislation or not. The degree of uncertainty is palpable.

And Russia seems to be targeting all products exported from a country, whether produced there or not. All the exports will have to be accompanied by safety certificates. This makes no scientific or public health sense since the exact same product if sent via country A will not require a safety certificate, but if sent via Country B, it will require a certificate.

Q: How important is Russia as an export market to Europe?

A: Russia is the biggest export market outside of the EU. And also one of the few growing export markets.

Q: Has the produce industry ever faced a situation like this with Russia in the past?

A: This is the first time with produce. There was a little history with Polish produce, and that was purely for political reasons, nothing to do with the safety of produce.

Q: Is Russia going beyond Europe in enforcing these new produce trade regulations? Will other countries be affected?

A: We’ve seen now the Russians are also putting out a memorandum to Turkey, to Argentina and to Chile. More countries are now receiving these new requirements. It’s budding. Our impression is that the Russians are going to all exporting countries to address the issue.

Q: Since the EU has already operated with such stringent pesticide and safety requirements, will other countries find the demands more challenging?

A: For Europe, we export a lot to Russia, but it is still marginal to what we sell within the European community. But other countries might be better able to adapt because they have larger scales of operations to Russia. Some of those countries have different distribution channels destined for targeted export markets.

It may be easier to adapt to Russian rules, if dedicated farms are producing for Russia. This is a more difficult issue in Europe where only part of production is going to Russia. Even if we are used to adapting to stricter requirements than the law, as we’ve seen tougher retail requirements coming from Germany or UK, what Russia is requiring is unmanageable.

Q: Russia claims European produce infractions justify the safety certification requirement. Could you further discuss the veracity of the claims?

A: We have serious questions with the Russian results for infractions, where there are no clearly defined limits. There were no infractions based on EU law. Some infractions of residue levels in excess of Russian requirements prove unmanageable for EU producers, where we see no alternatives.

Q: What products face the biggest challenges in terms of meeting Russia’s regulations?

A: Apples, pears and citrus really are the large volumes, and in each of these cases there is at least one substance where there is a real problem, and which we can’t do without.

We are currently establishing lists of solutions. These are the three most important crops.

We hope that the Russians will continue bilateral negotiations. At least by finishing these negotiations, we can have transparency on which residue limits we need to comply with. That is not clear. We are working with the plant protection industry to point out ways to alleviate potential issues and to seek reasonable procedures for delisting the countries if they show no problems.

Q: What are the procedures outlined by Russia at this time?

A: Right now in the memorandum it is vague on when and how the requirement for a safety certificate will be abandoned if there is no problem. There remains a lot of freedom for Russia on delisting a country. We’re kind of afraid it might take too long. For inclusion, if Russia finds one problem, you could be on the list of countries needing a safety certificate.

Q: Are negotiations continuing on these issues?

A: I try to remain optimistic. Last week we were all optimistic and the news came as a great surprise. Our due diligence is well known. If you think of GlobalGAP and other standards that the majority of our products comply with, that in itself should be enough for the Russians. At least they should know these standards exist.

Q: It seems ironic that Russia is questioning the EU’s commitment to producing products with low pesticide residue levels. Isn’t there strong consumer demand in Europe for insuring these programs exist?

A: Greenpeace and other anti-pesticide groups are very strong in Europe and the UK disseminating powerful messages to consumers and making it a major concern being picked up by politicians and the media.

There have been some very minor issues with pesticides but not to the proportion of what has happened with safety in the U.S. the past three years.

Q: What is Freshfel doing to help its members deal with this trade dispute?

A: Our role is coordinating information for our members so they know what to do, and we are in close liaison with the European Commission to advise them on where the particular problems are and to seek solutions. We are working along with the European Crop Protection Association, which can supply the data behind the chemicals. The Commission has always called on us to find out what we think and to help look for answers.

It is an interesting question to what extent countries can impose limits on pesticides. WTO rules require scientific justification for such restrictions. Russia would have a hard time producing scientific evidence to support this action.

After the Berlin Wall fell, the opening of trade with the East was initially focused on the cheapest product. The big protection for Russia was that most European produce was not grown to sell to Russia, so it typically met normal European standards just as American exports met US standards.

Now the Russian market has matured some and, certainly, if Russia wants to harmonize pesticide standards with Europe that would probably be a good idea.

We just hope that in these difficult times, this effort is not just a form of protectionism. The Great Depression was aggravated by beggar-thy-neighbor policies like America’s Smoot-Hawley Tariff Act. The path to greater prosperity lies through more trade, not less, so any move toward the other direction has to be quickly nipped in the bud.

Many thanks to Frederic Rosseneu, Secretariat, Freshfel Europe, for helping to clarify the situation for the industry.




Pundit’s Mailbag — What Is
The Pundit’s ‘Core Competency’?

We received this note shortly after publishing Great Expectations For President Obama:

I get a great deal out of reading your insights on the produce industry.

Your analysis of the Tesco deal has been excellent, although I think you have been slow to pay attention to Wild Rocket Foods.

Your cheerleading for Bruce Peterson annoys me, but that’s a minor point.

I think you are getting off track by offering your political opinions that do not relate to the produce industry.

You spread yourself too thin by appearing to be a worthy commentator on too many things, so you lose credibility.

Focus is important in any business, and yours is no exception.

Mindful of the risk that some of your political commentary might offend some of your readers, you come across as being above the fray, which puts you in the category of being pompous.

I don’t need anyone telling me how I should support Barack Obama just because he attracted 51% of the votes.

Please stick to your Core Competency.

Thank you for all of the really good work that you do.

— Peter Jensen
CEO
Eckert Cold Storage
Escalon, CA

We thank Mr. Jensen very much for his letter and kind comments regarding our insights into the produce industry.

He makes five primary critiques:

1. “Your analysis of the Tesco deal has been excellent, although I think you have been slow to pay attention to Wild Rocket Foods.”

We appreciate Mr. Jensen’s assessment of our Tesco coverage. Though we have written from time to time about Wild Rocket, we think about the critique of the company in the same way we think about the argument of those who claim the US stole the Panama Canal Zone from Panama. We certainly did not. We stole it from Colombia and created Panama to facilitate our larceny.

So a focus on Wild Rocket is really a convenient way of letting Tesco off the hook. Wild Rocket exists because Tesco willed it into existence. A simple e-mail to Wild Rocket’s CEO from someone of authority at Fresh & Easy or Tesco that possibly would read as follows would solve the slow-pay problem we mentioned here completely:

“I read the Pundit piece about the slow-pay practices of Wild Rocket and was shocked and horrified. I’ve spoken to my bosses here and please understand that this state of affairs is completely unacceptable. We want all your vendors whose product is destined for Fresh & Easy to be paid within 10 days of your receipt of merchandise. If you need us to pay you faster or require a capital infusion to make this happen, just let us know. We absolutely want this situation to end and end now. Let me know what you need from us to make it happen.”

Personally, our bet is that the produce executives in management at Fresh & Easy would like to send that e-mail. But Tesco doesn’t want to pay. So rather than buy direct and have its own credit rating sink, Tesco lets Wild Rocket do the dirty work.

Look, if it was an important priority for Tesco to see these bills paid promptly, they would find a way to make it happen. Blaming Wild Rocket is a bit of a distraction from the real issue.

2. “Your cheerleading for Bruce Peterson annoys me, but that’s a minor point.”

Since Mr. Jensen doesn’t send us a quote of what constitutes “cheerleading,” we are not sure what he is referring to. We try to acknowledge achievement and Bruce’s involvement in building the world’s largest retail produce program was significant. So we see nothing wrong with our coverage there.

After he left Wal-Mart, he began an initiative on traceability that led directly to the joint association plan. So we feel confident that this was coverage justified by the significance of his activity.

Now that he is CEO for a shipper organization, we write about him less but because of his background, he purchased produce from almost every major grower/shipper in the country and competed with virtually every retailer in the country. This means that he became well known — a produce celebrity — and that has created interest in what he does. To this day, a piece that mentions Bruce is e-mailed extensively.

If Mr. Jensen means we wish Bruce well, we plead guilty. Why should we not? During his time at Wal-Mart, when he didn’t have to do anything, he worked hard in industry associations and, on a personal level, we never knew him to turn down industry groups who needed him to speak at a conference or seminar. He returned phone calls and e-mails. Small courtesies perhaps but much appreciated. We get fan letters about him to this very day.

Momma Pundit taught us to wish everyone well, unless they give us a specific reason to do otherwise.

3. “I think you are getting off track by offering your political opinions that do not relate to the produce industry.”

The core of our difference here is that we think it all directly relates to the industry. And we are not alone in this assessment — Isn’t this why the Western Growers Association, for example, issued a formal endorsement of John McCain?

One of the problems trade associations have is they are paid money (dues) to represent the industry on special issues. That is why they are known as special interest groups. Highly homogenous groups, such as Western Growers, will actually endorse candidates. More diverse groups, such as PMA and United Fresh, tend to avoid broad-based endorsements and, instead, focus on individual issues.

The problem is that the business success of industry members depends not just on produce-specific issues but the general economy and broad-based policy decisions. If a Senator is right on industry message regarding pesticide policy, that is great — but we can’t ignore that his economic policy will cause a depression or his foreign policy will promote a war. Equally, issues such as card-check for unions or the estate tax are not irrelevant to the success of the industry.

In addition, success in business is at least as much a function of positioning oneself to take advantage of general economic trends as it is anything else. To do this, however, one must understand those trends.

The Pundit Poppa became a success in part because he studied international trade in college and looked to apply those lessons to the produce industry. That he saw the way the world was going and did this during a period when international trade was booming contributed to his success.

So we will stake our claim that thinking only about produce is too insular and leads to failure or at least missed opportunities. Thinking broadly and transcending the narrow particulars of a particular industry is the path to success.

We try to walk with our readers down that path.

4. “Mindful of the risk that some of your political commentary might offend some of your readers, you come across as being above the fray, which puts you in the category of being pompous.”

Fair enough, pomposity is the occupational hazard of punditry. So we try hard to not take ourselves too seriously. Did you ever see the bit we did to help the Vidalia Onion growers? Take a look here.

More specifically, we actually are above the fray. We are not running for office and have no particular skin in the game. We stand in relation to politics as does every American. We care for our country and we try and think things through.

We suppose we should also point out that there is a Mrs. Pundit, and those who know her will attest that she will quickly lance any inflation of ego that the Pundit might be prone to.

5. “I don’t need anyone telling me how I should support Barack Obama just because he attracted 51% of the votes.”

Actually Senator Obama earned 52.7% of the popular vote, the first Democrat to win a majority of the popular vote since Lyndon Johnson in 1964.

We would say our argument, though, was more subtle than Mr. Jensen gives us credit for. We never wrote that anyone “should support Barrack Obama.” What we wrote was that with expectations so high and the world in a mess of trouble, “President Obama will need all our help and everyone would be wise to give it to him.”

First, the insertion of the word “President” in there is a change not in degree but in kind. Up to the election, one could support the candidate one preferred, but after the inauguration the winner becomes the President of our country. It becomes impossible to wish failure upon him without also wishing failure upon our country.

Second, there is a big difference between giving “help” and saying one “should support” someone. Here at the Pundit, when we get a call from a staffer on either side of the aisle looking to brainstorm a bit on food safety, food security, sustainability or other public policy issues, we try to help. It is our country; we want to see wise policy options selected.

Helping in this way doesn’t preclude one from supporting a different candidate next election. It is just a way of saying that one’s desire to see one’s party or candidate triumph does not extend to wishing ill or harming one’s own country.

So our message to Mr. Jensen and anyone else who loves America would be to support whomever you choose in the mid-term elections in two years, support whomever you choose in the Presidential election in four years but, in the meantime, we only have one President and we rely on that President to help keep us safe from terrorist and to make wise economic policy decisions and for much else.

If you have a competency or position where you can assist President Obama in the effective performance of his duties, it would be foolish not to do so and we would be saying exactly the same thing if Senator McCain had won the election.

We appreciate Mr. Jensen’s frank letter and the opportunity it gives us to clarify our positions and why we think as we do.




Perishable Thoughts — Hope Obama
Helps Country ‘Arise’

Today we owe a hat tip to Dan’l Mackey Almy of DMA Solutions. She read our piece entitled, Great Expectations for President Obama, and it led her to send us a note that included a quotation:

Great article. Very good and much needed. I recently saw this quote and thought of it when I read this post this morning…

“I am not concerned that you have fallen. I am concerned that you arise,” said President Abraham Lincoln to his nation divided by the Civil War.

In no way are we facing struggles compared to the Civil War, but in modern times our struggles are real. Now that we have endured 18 months of constant reminders of the bad times we are in, I do hope Obama can help the country “arise”. I too, struggle, with the fact that A LOT of people who voted for Obama are expecting freebies… that is just unconceivable to me, but I know it is true.

I hope as Barack Obama turns his promises into actions and wrestles with the realities and constraints of being President, he does not disappoint his many followers and fuel even more a negative divide in the country.

I also hope that when he states “distribution of wealth,” that includes “distribution of accountability and willingness to work hard”.

— Dan’l Mackey Almy
DMA Solutions, Inc.
Irving, Texas

Well, coming from Lincoln, the sentiments would certainly be apropos to Republicans after the shellacking they took in the election. It also is true that it is a shortcoming of our politics that whether things are good or bad, whichever party is out of power has the strong incentive to portray whatever situation we are in as the worst of times.

The very cadence of the lines seems to fit with Lincoln’s prose, and one can easily imagine him using such words to one of his failing generals. But it is hard to imagine him saying such a thing to the nation as it distances him from the nation.

We don’t recall Lincoln ever referring to the population as “you” — it was always “we” or “our” as in “Four score and seven years ago OUR fathers …” or “Now WE are engaged in a great civil war…”

We asked Pundit Aide-de-Camp James Elmer to investigate the providence of this quote and the evidence that it was ever uttered by Lincoln:

Dan’l probably found the quote along with another quote from C.H. Spurgeon on page 273 of Speaker’s Sourcebook II: Quotes, Stories and Anecdotes for Every Occasionby Glenn Van Ekeren (Longman Higher Education 1988). There are no electronically searchable copies online through Google Books or Amazon. They have been intentionally blocked by the publisher, so I visited several libraries to find copies and discovered the quote appears exactly in the Speaker’s Sourcebook as it does in Dan’l’s email.

See a photocopy attached here.

The book is filled with exactly what the title describes and none of it is properly sourced. At first glance, what we see is a solid block of text, with Charles H. Spurgeon attributed as the author. My determination is that this piece of quotation text is at best an editing error, and at worst, yet another example of inaccurate quote attribution perpetuated by careless authors and editors. We’ll leave the Spurgeon quote for another day and look at the Lincoln quote.

*An interesting side note, Ekeren also published “The Speaker’s Sourcebook II — Quotes, Stories and Anecdotes for Every Occasion” in 1994, and while it does contain Spurgeon and Lincoln quotes, these specific ones were not reprinted from the 1988 version. Perhaps the publisher realized there had been an error?

In the book published in 2004, Embracing Eternity: Living Each Day With a Heart Toward Heaven, by Tim LaHaye, the author says:

“I heard once that a general wrote to Abraham Lincoln about a battle his troops had lost. Lincoln wrote back, ‘I’m aware that you have fallen. My concern is that you arise.’

Hardly a scholarly endorsement for the authorship of Lincoln, and LaHaye gives us no evidence whatsoever to support this anecdote. My guess is that he made it up, or someone made it up somewhere and told him. It is easy to think of this quote in the context of Lincoln hoping to inspire a wounded general to fight.

In The Atlas of the Civil War, President Lincoln writes this letter in July of 1863 to General George Mead, prodding him to pursue retreating Confederates after the battle of Gettysburg:

“My dear general, I do not believe you appreciate the magnitude of the misfortune involved in Lee’s escape. He was within your easy grasp, and to have closed upon him would, in connection worth our late successes, have ended the war. As it is, the war will be prolonged indefinitely.”

It seems as if Lincoln sounded angry rather than concerned and inspirational in letters to ineffective generals.

In another book “Moments Together for Weathering Life’s Storms” the quote is printed on page 63. We see this gem again, unsourced, and the section is titled “Day 23, The Fear of Failure”:

“In an Address to a nation divided by the Civil War, Abraham Lincoln underscored the need to persevere in spite of failure. He said, “I am not concerned that you have fallen. I am concerned that you arise.”

This sounds familiar, as it is the same story told to us in the “Speakers Sourcebook”. So we now have an anecdote of Lincoln writing these words in a letter to a general and another version in which Lincoln addresses the nation with these words. These two books are the only ones found, which hope to give any background to the quote.

Google Books searches for the quote itself; pieces and variations of it do not turn up anything that predates 2002, with the lone exception of 1988’s The Speaker’s Sourcebook, which cannot be found electronically. All of the books that have printed this quote are of the “self-help” and “unsourced quote collection” varieties.

A much appreciated wealth of historical works concerning Lincoln are available through Google Books. I’ve been able to electronically search through these endless volumes, below ranging in publish date from 1864 to 1917. None give any indication that Lincoln said, addressed or wrote anything similar to our quote. Here’s a short bibliography of some of the sources I searched through.

Abraham Lincoln as a Man of Letters

Abraham Lincoln: The True Story of a Great Life

Complete Works of Abraham Lincoln

HISTORY OF THE ADMINISTRATION of President Lincoln: Including His Speeches

Letters and Addresses of Abraham Lincoln

Life of Abraham Lincoln

Lincoln Addresses and Letters

Lincoln and the New York Herald: Unpublished Letters of Abraham Lincoln

Lincoln Legends: Myths, Hoaxes, and Confabulations Associated with Our Greatest President

Selections from the Letters and Speeches of Abraham Lincoln

Speeches & Letters of Abraham Lincoln, 1832-1865: 1832-1865

Uncollected Letters of Abraham Lincoln

Abraham Lincoln Complete Works Comprising his speeches Abraham Lincoln: Complete Works, Comprising His Speeches, Letters, State Papers, and Miscellaneous Writings

Speeches & Letters of Abraham Lincoln, 1809-1865

The Life of Abraham Lincoln Drawn from Original Sources and Containing Many Speeches, Letters, and Telegrams Hitherto Unpublished

The Autobiography of Abraham Lincoln: Consisting of the Personal Portions of His Letters, Speeches and Conversations

Beyond the 1988 Speaker’s Sourcebook, the earliest found reference to this Lincoln quote is a “dead” hyperlink that appears at the bottom of this page, which belongs to a site filled with famous quotations.

This “source” is awkwardly displayed as html code for a hyperlink that isn’t even functional. Contained within this inoperable link are mentions of “The Ultimate Success Quotations Library” and the year 1997, which we are left to guess is the written work and publish date where they attribute finding the source of our Lincoln quote.

[Coincidentally, this “Quotations Library” that they tout as the source is produced by the authors of the website themselves, the Cyber Nation folks out of Reno, Nevada. According to them, the collection allegedly used to sell for $79.95, but is now free. The final indignation is that a picture of Lincoln in repose on the Lincoln Memorial is used on the packaging box!]

So, ever since the popular emergence of the Internet, which I remember as being around 1997, this quote has appeared exactly as submitted by Dan’l, on this site, incorrectly of course, and probably copied from there into infinity. By 1997, it could very easily have been copied from The Speaker’s Sourcebook, since the text appears exactly the same in both places.

My final conclusion is thus: Based on the overwhelming documentation that is available and searchable on everything Lincoln said and wrote from his time as a lawyer until his death as President, there is nothing that even remotely connects this quote to anything uttered by Lincoln.

Which just goes to show that reality is often more disappointing than the fictions we might like to believe. Still, whoever came up with the phrase, there is wisdom there as, in fact, falling down is part of life. If you haven’t fallen a time or two, it probably means you never took a risk. In any case worrying about what has already happened isn’t typically very useful. The key to progress is making sure that the beatings don’t beat you down so much that you don’t get up to fight anew.

Good advice in 2008 for Republicans and useful to us all throughout our lives.

Many thanks to James Elmer for his in-depth study and to Dan’l Mackay Almy of DMA solutions for passing on the quote.

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