"NEVER BOIL AN ALARM CLOCK"Finally, we come to America's supposed leadership in scientific technology. This has always been an article of faith in other countries as well as our own. Only in the last few years has there been any real effort to examine whether America really has any significant leadership in technological skills. If you rely upon the schoolbooks you read as a child, you would be inclined to think that Americans invented nearly everything. Alas, the facts are that when it comes to technological innovation, it very strongly appears that Europe has pretty close to the same batting average that we have. What we so frequently take for American inventions are, in fact, European - though for reasons which I shall explain, they are widely accepted throughout the world as being purely American.
Much as I believe in capitalism, I cannot identify it as the particular ingredient which has built the astonishing American economy. What is this priceless ingredient then? I assure you that I do not claim its discovery. In retrospect it was perhaps first noticed by Alexis de Tocqueville when he wrote his treatise "Democracy in America" back in 1835. Even then he was struck by what he felt to be some peculiar American ideas about manufacture and trade. Although de Tocqueville was quite open-minded about this phenomenon, the European mind generally did not find much to admire. The idea of the typical Yankee trader foisting off wooden nutmegs on honest housewives, the concept of bumptious salesmen, planned obsolescence and unnecessary innovation became stereotypes that still exist not only in the minds of Europeans but in the minds of many presumably intellectual, present-day Americans who adhere to European value systems.
American inventiveness? No. For example, the following important recent inventions had something in common. Sonar, color TV, jet engines, the Kaplan turbine, zoom lenses, polyester fibers, radar, continuous casting of metals, holography, high-speed phototypesetting and variable geometry aircraft wings. What did these inventions have in common? None of them originated in the United States. But they have been, without exception, taken over, developed and successfully marketed by American firms. The power of the Yankee dollar? No. The total Yankee direct investment to date in Europe is only $16.2 billion - somewhat less, as you know, than the annual Yankee expenditure on advertising in this country alone. Superior industrial management skills? Not that, either. Anyone familiar with European managements knows that they are highly intelligent, hardworking and enormously innovative in research and manufacturing methods.
I have now kept you in suspense for an inordinate length of time, for which I apologize. But I have needed this time to reveal that all of the wonderfully simple theories that have been hypothesized to account for American economic dominance turn out to be fantasies. But, as de Tocqueville anticipated, we do have something. For lack of a better name I am going to call it the "American Marketing System." You will not find it defined among the supply-and-demand curves of college economic texts. You will not find it in the civics or history books of your local high school.
It has always been a philosophic question whether a man should have what he wants instead of what he needs, and the world has not lacked moralists to point out the horrors of letting man give way to his baser instincts. Unfortunately, the question of who is to decide what a man needs is a difficult one. Objectively, a life-support system for man involves only oxygen, water, about fifteen hundred calories a day and a warm, dry place. Beyond that, anyone who specifies the needs of man is expressing only his own personal preferences based on his own culture and his own personality. Mankind has always been well supplied with authorities who are prepared to dictate what man's needs are. According to them man's needs usually happen to coincide with the authority's particular wants. "Father knows best" has been the slogan of every government from the theocracy of Sumer to the present day.
For the secret of the American Marketing System is that it is designed to give people what they want. What they want may seem to you to be foolish. It may seem to me to be foolish. It may even seem foolish to John Kenneth Galbraith. But who among us, may I ask, was authorized to determine what people should spend their money on? The American Marketing System is based on the simple proposition that a man free enough to select his own government is just possibly able to decide what to do with five bucks.
The second factor in the American marketing System is that when you have identified the consumer's problem and developed a solution to it, you promptly communicate that solution by the speediest and most economical means. Today those means are advertising, promotion and salesmanship.
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