On the EDge: It won’t be long before everything is made in China

Photo of Gibson Les Paul by freebird_71 licensed under CC BY-SA 4.0. Chinese cargo photo by Nerthuz/iStock/Getty Images Plus, St. George News

OPINION — Despite the outpouring of grief and condolences last week, the death of rock ‘n’ roll has been greatly exaggerated.

Look, you don’t have to examine chicken vitals and talk to departed music gods to understand that the direction the industry has taken is way off the rockin’ road. Just check out the whackdoodles like Kanye West, tune in insouciant poseurs like Taylor Swift, wallow with the whinies – from Ed Sheeran to just about any off-key alt-rock outfit stuck rehearsing in mama’s basement – or try to digest the sugary pop swill of what passes for country these days and you’ll understand.

Rockers still rule, which is why Guns N’ Roses is still a big deal on the tour circuit, why it was newsworthy when Tom Petty’s former guitar player Mike Campbell signed on to replace Lindsey Buckingham in Fleetwood Mac as the band prepares for a fall tour or why the biggest draws in that vast desert wasteland they call Coachella have been artists like Roger Waters, The Rolling Stones, Bob Dylan, The Who, Neil Young and the forever young Paul McCartney.

Still, as news broke that Gibson, the company that has manufactured guitars for everybody from rockers Jimmy Page, Pete Townshend and Skydog Allman to blues masters like B.B. King had filed for bankruptcy, so did speculation about the demise of an art form that dates back to Elvis, Chuck Berry and Big Mama Thornton.

Save your breath. Gibson will continue to make guitars, at least for a little while. They may not be as good as they once were, but you will still be able to find a new Les Paul or Firebird next year.

Why? Those geezers down the block are spending their kid’s inheritance on a classic Les Paul gold top to play in a band with other old guys reaching out for one last clutch of fleeting youth by covering the Stones, Beatles or other 12-bar blues classics at the local bar.

Guitar sales may be down in year-over-year comparison, but if you look at a 10-year overview, sales are actually more than 200,000 beyond conservative forecasts. The problem isn’t with Gibson or rock ‘n’ roll, the problem at Gibson is the same as the problems at many other companies: greed.

Gibson was holding its own despite some serious setbacks. There was a problem with them using environmentally protected wood; there was a problem with quality control spiraling downward while prices continued to climb.

Gibson CEO Henry Juszkiewicz was also bedazzled by questionable innovation and soon his guitars had some of the most bizarre devices available, including a piece that would automatically tune your guitar. It was a little less than desirable to musicians who quickly noticed the drawbacks to robotic tuning. This gave one more reason for them to thumb their noses at Gibson

The biggest problem, however, came when Juszkiewicz decided that the company would broaden, that it would not only be recognized as one of the truly great guitar manufacturers in the world, but would also become a major “music lifestyle” brand by investing in the home entertainment and audio equipment industries.

That meant purchasing the consumer electronics arm of Phillips.

The company promptly went more than $500 million into unrecoverable debt, which led to the bankruptcy filing.

Guitar players told Juszkiewicz what they wanted, shared their concerns over a failing product and odd-ball innovations.

He ignored them.

“(The industry is) stuck in a time warp, and the ‘purists’ have a very loud voice on the online forums,” Juszkiewicz said during an interview with Billboard magazine not long ago. “Kids today may think some music from the ’50s is kind of cool here and there, but what other industry do you know that hasn’t changed since the ’50s? Those guitars from the ’50s are what the purists want, but we have to have something new and exciting.

“Imagine if the camera had never changed. Innovation is a part of every business to some degree, but (the guitar industry) hates it. The kids demand it, and if you don’t have it, they walk.”

Except, guitar players disagreed.

They didn’t like his innovations.

They didn’t like his product.

They didn’t like his arrogance.

And, now, the company is on the ropes.

This isn’t simply a cautionary rock ‘n’ roll tale.

It is a story of how unchecked capitalism will, eventually, be the ruination of our economic system.

That whole supply and demand thing? It works until Joe Suit decides that he needs to have larger profit margin for himself and his investors.

So, he innovates and he expands his business parameters, often jumping into areas of tricky expertise that are an arm’s reach beyond his understanding and abilities.

He gambles because, hey, he’s nice and cozy with fat cat salary and perks and if, somewhere along the line, he must bail out, a very lucrative golden parachute awaits to ensure a soft landing.

Those poor minions who labor in the trenches?

They’re out of luck because of some executive suite pipe dream about growing profits by purchasing some marginal company that, at the time, seems to be a good fit, only to realize they spend most of their time trying to trim that square peg to fit into a round hole.

They forget one of the primary tenets of good business as described in a book called “Good to Great,” a treatise on how to legitimately grow your business, and that is to realize exactly what it is that you do best and do it instead of getting tangled up in foolish expansions or acquisitions that could bankrupt you.

Gibson has, for years, built good guitars.

It is what the company does best.

It is not, however, experienced in the home entertainment business or home audio business. As a result, Gibson went a half-billion bucks in the hole and the CEO looks like a world class fool.

I once worked for a corporation that made the same mistakes.

It was not pretty.

Look for more of this, to be sure, as the house of cards that is our economy remains one small breeze from collapsing upon itself.

Conventional thinking about the market and market acquisition strategy is proving to be outdated as corporate America swallows up more and more small businesses in an effort to squeeze every conceivable nickel out of them.

Capitalism has been corrupted by the moguls from the top and their disdain for the workers, who have just about given up on the old idea that if you work long and hard and are loyal, you, too, will someday be rewarded.

Not so many people are finding those rewards these days, however.

Most find they don’t even get a gold watch when they finally hang it up.

If you are lucky, you may or may not get a lovely parting gift and whatever you were able to cobble from your 401(k). But, unless you earned money working in the family business and were paid with family money, your odds of success are not terribly great whether you make guitars or anything else.

Besides, tariffs be damned. It won’t be long before not only signature suits and ties, but guitars and everything else are made in China anyway.

No bad days!

Ed Kociela is an opinion columnist for St. George News. The opinions stated in this article are his own and may not be representative of St. George News.

Email: edkociela.mx@gmail.com

Twitter: @STGnews, @EdKociela

Copyright St. George News, SaintGeorgeUtah.com LLC, 2018, all rights reserved.

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14 Comments

  • mctrialsguy May 8, 2018 at 4:17 pm

    In thanks to your favorite people, Billy “The Fondler” Clinton and the Barrack “The Muslim” Obama. They gave away the country for votes and favors!

    • John May 8, 2018 at 4:39 pm

      You hit the nail on the head,mctg !

    • comments May 8, 2018 at 6:51 pm

      And, ofc, Baby bush II was as innocent as as angel, seeing how he was R-party. It’s all the ‘libruls’.

      Well said, Ed. Nothing to disagree with here. It is sad to see iconic companies that once made fantastic products sellout and start building throwaway junk from overseas.

      • comments May 8, 2018 at 6:53 pm

        Actually the companies don’t even build the products usually, after they’ve sourced from China. They usually source “a blank” product from a Chinese factory and just slap their label on it

  • chris keele May 8, 2018 at 7:56 pm

    Gee Ed, i wonder if having your hero Obama’s justice dept. in Sept. 2011 sending in the heavily armed federal agents,who took over the Gibson factory, and sent all the employees home, and then shut the business down while they could confiscating the wood that was being used to manufacture these guitars, all in the name of some alleged jackass environmental infraction could have had any thing to do with these decisions that were made, and the constant harassment from that jackbooted administration of thugs. Come on Ed is your memory working? Or has your recall been affected somehow?

    • dogmatic May 9, 2018 at 3:54 am

      Eddy boy has selective recall.
      Thanks for reminding me of the Gibson company raid Chris.

    • Ed Kociela Ed Kociela May 9, 2018 at 11:33 am

      Actually, if you read the piece again you will see that the environmentally protected wood violation is mentioned. In the grand scheme, that has nothing to do with the current revenue crisis at the guitar manufacturer. Gibson, in 2012, was fined $350,000 after two raids (one in 2009 and one in 2011) for using environmentally protected ebony wood (the Lacey Act) from Madagascar. The other raid yielded questionable wood from India, which was later returned to the company because of some gray area questions. Gibson officials acknowledged, after the investigation, that they knew it was illegal to purchase the wood from Madagascar.

    • Lee Saunders May 9, 2018 at 9:28 pm

      I suppose it’s also okay with you that rhinos and elephants are slaughtered by poachers for their ivory?

  • commonsense May 8, 2018 at 8:37 pm

    Ed, AKA Bikefish you have to politicize everything. I love Kane West and I’ve never heard a single song. He is a man of courage, unlike the sheep who follow the likes of Whoopi and other undereducated Hollywood types who live in a fantasy world like you.

  • dodgers May 9, 2018 at 5:30 am

    Yes, Kanye is a hero. Speaking up, having a mind of his own, daring to leave plantation. He’s got my respect.
    As for Ed, he appears to be getting more angry every week. He needs to take some time off, do some biking and fishing.
    There are positives. Perhaps the glass is half-full Ed.

  • Thecadean May 10, 2018 at 9:06 am

    Silly article. Gibson will continue to make guitars. It’s a great product owned by a very greedy and poorly managed company. The making of guitars is just a sliver of the overall business and will survive so long as they make a product the public demands.

    With regard to China making everything is just pure ignorance. USA has continued to growing manufacturing for over the past 10 years. It’s automation and robots that will replace the US worker. The fact that the US will not graduate many engineers and is unskilled is a much greater threat. Iran graduates more engineers each and every year than the US and yes China and India supply 10x the number of engineers. USA benefited greatly from these highly educated foreigners moving here. In fact over 50% of the companies listed on the US, S & P 500 are started by these same immigrants. (per Colin Powell, sec of State). The key is not to demonize everyone that does something better than us (recall how Japan and the Saudi’s were going to take over the US??) but to embrace the achievements and welcome them to join the US to make us all Great Again. This is called a win -win

    • comments May 10, 2018 at 9:42 am

      “This is called a win -win”

      no, it isn’t. aren’t you just a good little globalist “free marketer”. You’re either naive/ignorant or you are benefitting ($$$) from investing in globalist companies.

    • comments May 10, 2018 at 9:48 am

      china builds nearly everything. Japan and korea, etc have been building fantastic products for a long time. There’s just something about Chinese culture where they haven’t caught up and continue pumping out junk product. But they are the world’s biggest supplier of… well, everything. Very very cheaply paid labor, inferior products, that’s most of the story right there.

  • Tyler May 10, 2018 at 12:45 pm

    Good ole Eddy… Aways good for a laugh

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