Monthly Archives: March 2016

My Chicago

By Lloyd Graff

Chicago’s new Maggie Daley Park is located right downtown on the lakefront.

I got an email from an old friend in Florida, Bob Ducanis, asking me to write a column explaining what is going on in my Chicago.

I immediately heard the refrain, “My kind of town, Chicago is my kind of town,” the old song. And then I paused to ask myself, is it still my kind of town? Is it a place I am happy to call my home? Do I want my kids and grandchildren, to call it home for a lifetime like I have?

These are my feelings for Chicago, 2016. It changes slightly with the headlines, but only a few degrees.

First, let’s get the pronunciation right. My town is Chicawgo. If you don’t get the middle syllable right, move to Gary and never schlep into the city for pizza.

Like other big rust belt cities, it is a huge living contradiction. It is losing population faster than any other big metropolis, but upscale condominiums sell quickly. No overbids like San Francisco and Los Angeles, but firm pricing near Lake Michigan and the neighborhoods young people want to live in. Both of my sons bought homes in the city in the last five years and their property has gone up in value.

Racially, the city is segregated by neighborhoods, though not as much as it used to be. The south and west sides of Chicago are war zones. Black youth unemployment is 50%. The schools are dangerous places. Drug wars menace everybody in neighborhoods like Englewood where my father and Derrick Rose grew up 80 years apart. Our business used to do its banking in Englewood at 63rd and Halsted. Today it is an empty lot.

If you are poor and black and live in Englewood or other neighborhoods like it, you live in the American version of Syria. Refugees are leaving for relative safety in places like Atlanta. They can leave without a passport, and they are. Frankly if I were Black growing up in Englewood I would leave, like my great grandparents left Russia and its violence. We have no KKK in Chicago, no lynchings, but random slayings every day and night for innocents unlucky enough to be in the wrong place at the wrong time.

Englewood in Chicago, where Derrick Rose and Leonard Graff grew up.

When gun violence is so rampant it affects people who live in relatively safe areas. I live in a comfortable integrated suburb of Chicago, 28 miles south of the Loop. The local Starbucks and Panera usually have half black and half white customers. This is an anomaly in Chicago. Yet the parents of black male teenagers in my suburb are truly fearful of their kids being stopped by the police. They constantly counsel their children about how to act if stopped by a white cop. Many want to send their kids to predominantly Black colleges in Atlanta to escape the violence.

White cops are definitely very cautious about Black youth. The widespread use of video cameras has made officers potential targets of scrutiny, especially after high profile shootings of unarmed black teenagers were caught on camera.

My Chicago is a war zone in certain areas, but to me it still feels like a thriving metropolis of great restaurants, theatre, and beautiful parks. The Lakefront is as spectacular as ever. Joggers and bikers are everywhere. Tennis and volleyball courts are jammed in the summer.

Manufacturing has moved out of the city for the most part because real estate has become too valuable to be used to bang out widgets. But the area around Ohare Airport still houses many hundreds of factories. Skills are available in Chicago if you are willing to pay for them.

Politics in Chicago and Illinois are maddening. Rahm Emanuel wanted to be Mayor of Chicago for some ungodly reason and he is paying the price for his decision. His popularity is extremely low. The city is virtually broke thanks largely to his predecessor, Rich Daley, who never had the guts to turn down organized Labor’s demands. The teachers loathe Rahm. They figure he stole the last election by withholding the videotape of the killing of Laquan McDonald by a cop from public view until after he won the runoff. The school system cannot afford its pensions and current staffing and seems ready to accept a strike. Emmanuel is borrowing from Peter to pay Paul but a showdown is coming with the teachers. Meanwhile, Illinois state government is in a permanent stalemate that makes Washington look like a yoga class.

Politically, racially, financially, Chicago is a total mess, but as we head into spring the place is bursting with a positive energy for the Cubs and the Blackhawks. Chicago loves its teams and I’ve never seen so much optimism about my Cubbies going into a season. Everybody loves them. Of course, this scares me to death, but that’s another column.

I travel to the Bay Area frequently to see my daughter and family. It is a happier place than Chicago. People are not killing each other nearly as often. Racial fear is not on everybody’s mind. The weather is 10 times better out there. They have Steph Curry making threes, which is certainly a natural resource.

But Chicago still has a lot going for it, even if the city totters near bankruptcy. It has a fantastic energy that the Bay Area does not exude. It has way better pizza. It’s in the middle of things, and the country. You can still live in a nice place that is affordable.

My wife and I often talk about moving to California. The weather in the winter would sure be nice. But Chicago is such a hairy beast of a place, it will probably hold us in its powerful jaws forever.

Question: Do you want to live where you’re at, forever?

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Kids in the Workplace

By Lloyd Graff

In Chicago this week the big story (even bigger than the Illinois primaries) has been the retirement of Adam LaRoche, a designated hitter, first baseman for the Chicago White Sox. He walked away from a $13 million contract because the Sox management objected to the frequent presence of his 14-year-old son, Drake, at the team’s practices and games.

Drake is being homeschooled so he has a lot of time to be with his Dad. He went to 120 Sox games last year, often traveling on the team charter plane. He has an official White Sox uniform and spent a lot of time in the clubhouse, which is off limits to the press and friends. It is the inner sanctum of the team.

Adam LaRoche had informed the White Sox that he was close to his son and wanted to have him around frequently, but Sox management, especially Kenny Williams who is at the top of the team’s management group, reporting to the longtime owner Jerry Reinsdorf, was surprised and bothered by his almost constant presence at spring training in Arizona.

When I heard about this case I found it shocking, that the 37-year-old La Roche, coming off a terrible 2015 season, would walk away from $13 million, which was most likely his last contract as a player.

The case is fascinating to me for many reasons. I can see it from the White Sox point of view – overpaid player disrupts team chemistry. The son’s presence distracts Adam LaRoche. The locker room privacy is invaded by a teenager. LaRoche is an embarrassment to the management team that grossly overpaid for him.

It was logical for the White Sox to get rid of the kid and possibly get the added benefit of nudging the father to abandon the fat contract.

I would have thought the players would be relieved to have a “punk” kid and overpaid DH gone, but it has not played out that way so far.

It appears that Drake LaRoche was a mature and respectful young man who was loved by some key players like a younger brother without family baggage. And his father Adam was a highly respected mentor who helped several players through work and personal problems last season.

When Kenny Williams laid down the hammer on LaRoche’s son, thus prompting Adam’s resignation, he ignited a mini players’ rebellion led by the team’s star pitcher, Chris Sale.

The chemistry of a sports team is fragile and fluid. Last year the Sox underperformed their talent while their Chicago rivals, the Cubs, overperformed. Williams may have been looking for the opportunity to shake up the team, but a shakeup can also make things even worse.

It brings up personal issues for me. I worked summers for my father for six years, from the age of 17. To me it seemed like it never bothered anybody, but much of the time my father’s partner’s son, Dan, also worked. When my brother Jim joined the group things got more complicated in the office.

My wife started working in her Dad’s law office when she was 15. She heard a lot of gossip amidst the paperwork. But I have no doubt that the presence of children in a family business in a visible position has the potential for disruption and jealousies.

I was fearful of repercussions when my son Noah joined the staff of this publication which ultimately morphed into a position at Graff PInkert, the family machinery business. Ultimately, it did cause resentment for my brother.

Family businesses and Major League baseball teams are not analogous but the LaRoche flap has similarities. At least as far as White Sox top management was concerned, Adam LaRoches’s son was ruining the chemistry of the team.

A little of Drake LaRoche probably would have been okay. Adam had hung around some when his father Dave was a Major League pitcher and coach, but not for almost all of spring training and 120 games last year like Drake.

This is a sticky problem for the Sox. How would you have played it?

Question: Were the White Sox correct in expelling LaRoche’s son?

Question: How do you feel about kids in the workplace?

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Inventory Free

By Lloyd Graff

Usually I live my business life talking to people who are extremely skilled at cutting bars of metal into a lot of useful widgets and selling them for a modest profit to a company that assembles them into useful industrial products.

But a few days ago I had a lengthy chat with Mitch Free, who is playing the game somewhat differently than most of the folks in the machining business.

Mitch Free’s name is appropriate because he has freed himself from the conventional wisdom of the business, even though he happily runs a nice assortment of CNC lathes and mills at ZYCI, his shop in Atlanta. Mitch is a born and bred machinist, but he doesn’t think like one. He has wholeheartedly embraced 3D printing of both plastic and metal, but he acknowledges its limitations in accuracy. In metal, 3D printing produces a part of similar quality to a casting, but without the metallurgical integrity to withstand the high stress of many aerospace applications. But for a fuel nozzle like the one General Electric makes for the aviation market, it’s quite appropriate.

To Mitch, the beauty of additive manufacturing is that it is an almost perfect fit for the digital, cloud based world that views inventory as intellectual property, not plastic or metal pieces. He has launched a growing partnership with UPS, also based in Atlanta, to strategically attack the traditional imperative of stocking stuff.

Mr. Free has a lot of experience in the digital world, having started an internet based quoting clearinghouse called MFG.com during the dot-com boom. His work with MFG.com helped him grasp the link between the digital world and the manufacturing world.

A few years ago he wangled an invitation to UPS headquarters through a social acquaintance, only to be ushered into the inner sanctum of top management because the shipping behemoth happened to be looking for somebody like him who saw the strategic implications of no inventory, inventory management, and had the knowhow to make it happen.

Mitch Free, founder and CEO of CloudDDM (www.cloudddm.com) and ZYCI CNC Machining (www.zyci.com).

UPS has a five million square foot logistics center in Louisville, Kentucky. Besides being a gigantic hub, it is also where UPS stocks inventory for a multitude of clients waiting for orders. What Free, UPS, and its clients understood was that physically stocking millions of pieces of stuff is expensive. They asked themselves, what if rather than stashing it in bins, you just had the digital data in the Cloud which you accessed on demand and then made the widgets within 24 or 48 hours in Louisville, then shipped them from there?

This was the concept that Mitch Free and UPS envisioned at the meeting in Atlanta, and they have made it happen in their old Kentucky home. Free says that he has 100 machines in Louisville, mostly 3D printers making stuff virtually overnight with the orders coming online via the Cloud.

Mitch believes UPS lives in fear of their biggest competitor and customer, Amazon, gradually replacing them as a primary shipper. Mitch says it is extremely likely that Amazon is also experimenting in this arena as they focus on every form of delivery vehicle from drones to Uber. The more links they take out of the supply chain, the closer they come to owning it.

Mitch Free knows Jeff Bezos, the head of Amazon, because one of Bezos’s companies, Blue Origin (his space transport company) did business with his MFG.com firm and partnered with him in 2007.

As I sit here enduring the ups and downs of the high production piece part world, companies like Mitch Free’s, Amazon, and UPS are looking past the sclerotic traditional inventory-dominated world. Free acknowledged that 48-hour delivery for most things is still just a dream, but it is a dream that a lot of money is chasing. As 3D printing improves it will challenge subtractive machining, but will also work in tandem. On small quantity production additive manufacturing will take a bigger and bigger share. The metal or plastic will make the rough part and the CNC millturns will finish it. Companies will pay a significant premium for speed. For UPS and Amazon that make the spread for inventorying and shipping, it means huge money. For Mitch Free and others who can adapt to the 24 or 48 hour inventory world it could be the gold ring.

In a few years we will see robots fill the aisles in Louisville and other distribution hubs. More products will be designed from inception for digitization and there will be a huge business in digitizing old semi obsolete parts that do not lend themselves to physical inventory because their yearly usage is so low. Think of all the old Air Force planes or tanks that need low volume replacement parts.

This is going to be a huge opportunity for folks in the machining world. If it costs the same to make one part as 25, and companies are going to buy one piece at a time, it will change the economics of manufacturing. That future is already working in Louisville.

Question: How are you adapting to an inventory light world?

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My Cousin Donnie

By Lloyd Graff

I once had a cousin named Don. Don was a couple months older than me. We played softball together and a lot of ping pong. That was until we were 16. Then I lost track of Don. I never saw him again.

Donnie and I were first cousins. My Uncle Jerry, my father’s elder brother, was his Dad. He lived a few miles from us on the southside of Chicago. Jerry made a lot of money in the plumbing supply business, but he was too cheap to buy a home in a nice neighborhood. He rented a stuffy apartment in a three flat in a sea of other three flats four miles south of us.

Jerry used to bring Donnie over to our house so we could play catch or ping pong, but we never really talked about anything. Don was a mystery to me, but I was too naïve to know why at 10 or 11 years old. He was just my cousin Don who played ping pong left handed.

After grade school I went to the University of Chicago Lab School, a school for the kids of faculty members and an assortment of teenager’s from Chicago’s southside whose parents wanted them to get a really good education. Don went to his public high school, South Shore, but in his junior year Jerry enrolled him at the Lab School. I had no idea why he moved him to Lab. He just did. It seemed odd but I didn’t ask.

Don had no friends at the Lab School. Actually, Don had no friends at all, I think. We weren’t really friends, we just played ping pong together when Jerry brought him to our house.

We were in one class together our Junior year, English Literature with Eunice Rosenthal. Mrs. Rosenthal was a thin dark haired woman who wore stylish suits to teach her class. I remember her as a frigid bitchy lady who scared her students. She never smiled. English Lit was a class I was good at, but all I wanted to do was be invisible in her class.

One day in the Spring of 1961, Mrs. Rosenthal was talking about Hamlet and suddenly aimed a question at my cousin Don. It seemed innocuous when she asked it, but Don struggled to answer. She would not let him off the hook. She kept badgering him, then ridiculing him, mocking his halting answers. I could feel Don’s discomfort as she slid the verbal knife into his vulnerable psyche.

And then Donnie got up and ran out of the room. He ran out of the school. He just kept running. Eunice Rosenthal just ignored it and kept teaching her damn class. And Donnie ran.

The School called Jerry Graff and Jerry called his brother Leonard (my Dad) and eventually they found Don crumpled up.

I was confused about the whole event. My father wouldn’t tell me what was going on with Don, but he did not return to school that semester. He never returned. I never saw him again.

Life went on for me. I played basketball, went to college, the Army, marriage, a life. Don went to a “mental hospital” where he stayed quite a while, I came to learn. Schizophrenia, my father whispered to me a long time later.

Schizophrenia. It seemed so scary to me. Donnie, my first cousin, my lefty ping pong partner, was Schizophrenic.

He eventually got out of the hospital and left Chicago. Jerry told me he got a job with the Government. Who knows if he really did or not.

I asked Jerry and my Dad about Don from time to time. The answers were a couple sentences of avoidance. I didn’t probe. I didn’t want to get close to Schizophrenia. I didn’t even want to say the word.

Don was frozen in time for me as my 16-year-old cousin who used to play a nice game of ping pong – and ran away from Rosenthal and never came back.

Five years ago I received a phone call from Don’s niece. “Lloyd, I just want to let you know that Don was killed a few days ago in Washington. He was walking his dog at four in the morning and a guy in a Honda hit him,” she said.

I had not seen him in 50 years, but still I was stunned. A presence in my life was dead. I had never reached out to him. Jerry had never given me his phone number, but I had never asked for it.

Don was an outcast in the family. He had never tried to connect. I could never forget him, but I was afraid to reach out to him. Schizophrenia, it scared me.

They buried him and I went to the cemetery. I guess that was safe for me.

And the strange thing is I recall Don Graff now every day as I run through the dead people I’ve known who are worth remembering for me.

Don struggled with mental illness most of his life. I struggled with just the thought of it.

Question: How have you dealt with mental illness?

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Trump Gets It

By Lloyd Graff

Courtesy of themarshallreport.com

I must admit I am totally into the 2016 election. The ascent of Donald Trump is so stunning, so horrifying, but also so wonderfully amazing that I cannot get enough of it.

Trump is narcissistic, incredibly egotistical, yet instinctively brilliant in his ability to connect with the American psyche.

Somehow Trump gets it. This rich, womanizing boor, vain to the nth degree, has figured out America and the dissatisfaction and anger that rightfully fills the country.

Frankly, I didn’t get it until very recently when I read an absolutely brilliant op-ed article called Why Trump Now? by Thomas Edsall in The New York Times. Edsall chronicled the devastating changes in America over the last 45 years. This has been the length of my business career. Yet I missed the big picture that a disgusting head case named Trump picked up on while I lounged in consensus ignorance.

A few highlights of Edsall’s piece. Adjusted for inflation, average wages per hour in the U.S. have gone up from $19.18 to $20.67 since 1964. While this number is somewhat deceptive because of advances like the Internet, cleaner air and the Roomba, it is still stunning.

Edsall states that since the year 2000 the middle class has shrunk while the number of households with incomes of $35,000 or less have grown. This has coincided with the huge growth of trade with China since its entry into the World Trade Organization in 2001. Chinese trade has not worked well for the American worker. The theory had been that the growth of China would be a two-way street. We would get cheaper goods, China would join the family of wealthy and peaceful nations. American workers would gravitate to sophisticated higher paying jobs in aerospace, medical, pharma, computers and robotics. But the theory has not worked. China has generally prospered but American workers have not transitioned quickly to the juicy high-tech economy. There are many reasons why U.S. workers have fared poorly—lousy government policies, easy access to illicit drugs, miserable public education for poor people, slowly receding racism, corruption in government, business and organized labor—you can count the ways.

Politics has failed us. The end of the Cold War did not bring a peace dividend. The military has drained resources, government debt has ballooned because politicians have sold out to inertia and the contributions of shrewd lobbyists.

In 2008 we had the Wall Street fueled collapse, which devastated millions of people in America, yet Wall Street rebounded quickly with Federal Government aid. A helpless and corrupt Washington could not see a better way out of the perilous mess than throwing a TARP over it.

Somehow Donald J. Trump understood in his gut what the political establishment, despite the growth of the Tea Party, did not comprehend. And on the left, Bernie Sanders saw very much the same thing. American workers were hurting, small business was suffering, students and young people saw a fuzzy and dismal future, and Washington’s answer was an indecisive intellectual Obama whose single accomplishment in office was a flawed health care system that many working class and richer Americans saw as an enormous transfer of wealth to poorer citizens and especially African Americans. All this set up a crazy opportunity for Donald Trump to step into an angry void in the predominantly White Republican Party.

The other candidates did not feel the anger and the opportunity, but Trump and Bernie got it. Hillary Clinton may ultimately get the Democratic nomination because she can skillfully glom onto the Black and Latino vote, but she doesn’t really tune into the anger in the country like Sanders and Trump.

Donald J. Trump, with his hair, his insults, his mocking vulgarity makes me nauseous. But he’s funny in a Don Rickles way. I’m attracted and repelled by the man, almost simultaneously, but his outrageousness is exciting. His unpredictability is also refreshing compared to a scripted Ted Cruz, and a Marco Rubio who seems too small for the job he covets. Trump has an instinctive knack that all bullies have of finding the character flaws of their adversaries. He picks on Rubio for sweating under pressure and calls Mitt Romney “a choke artist” for not campaigning the last month of the 2012 campaign. Trump is an awful human being. His character flaws are HUGE, but wow is he entertaining, like a sarcastic comedian!

I feel like I am finally in tune with the misery of the electorate and that’s why I am feeling the magnetism of Donald Trump, “Teflon Don,” who can seemingly get away with saying anything, no matter how outrageous.

I think Trump may well be our next President. I am frightened, but weirdly looking forward to the show. America wants to push the reset button.

Question: Are you depressed about America?

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Muslims in Munich

By Noah Graff

Patriotic Europeans Against Islamification of the West setting up protest. Munich, Germany. February 21, 2016

Just got back from a trip to Germany last week.

While we Americans are spending our energy hootin and hollerin about the 5000 Syrian refugees we let into the United States in 2015, who we vetted for a year, Europe, Germany in particular, is letting in an ongoing stream of refugees (and many non-refugees) from the Middle East. Germany alone allowed in around 1.1 million immigrants from the Middle East in 2015. Pretty significant when you consider that the entire country is around the size of Montana.

I queried a few people in Munich on their views of the immigrants during my trip. However, I must admit that the two main people in Germany who shared their views with me were not actually German. Maya was an Israeli woman in her 30s who had been living in Munich for five years and Roberta was an expat from Delaware. Maya glumly told me that people feel less safe walking the city’s streets at night than they did a year ago. She believes that many of the immigrants are not actually refugees, but young Middle Eastern men who have slipped in amongst the refugees. I know I’m guilty of racial profiling, but I admit that while I was waiting at an empty train station late in the evening I felt nervous as I observed many young Middle Eastern men loitering around.

One Sunday afternoon Maya and I observed volunteers from the organization PEGIDA setting up a spot for a protest in the famous Odeonsplatz square. PEGIDA, short for Patriotic Europeans Against the Islamisation of the West, is a highly controversial Right Wing group, who many people in Germany and around the world have labeled xenophobic and even as modern day Nazis.

The scene was fascinating because the protesters’ tent was being set up in front of the Feldherrnhalle, or Field Marshal’s Hall. During World War II a giant portrait of Hitler had stood under the arches of this building. The ruthless Nazi SS enforced a law, that said anybody passing by the building had to turn toward the portrait and do a hiel Hitler. A little alley on the other side of the building has been memorialized for all of the people who took it to avoid the Fuhrer.

Being the inquisitive folks we are, Maya and I engaged a woman who was helping set up. Low and behold her name is Roberta and she hailed from Delaware, U.S.A. She was personable and eager to stop what she was doing to talk to us.

Roberta was an expat who said she had lived in many countries. She calmly explained that she is concerned about the mass unregulated influx of Muslims’s pouring into Germany and Europe on the whole. She said that the country does not have the resources to take care of all the immigrants and that the money being used to take care of the immigrants could be instead going to support the pensions of the country’s retirees. We asked her about the organization’s opinion of Jews and Israel and she beamed with positive words for both. She also said she has friends in Germany who are Muslim but agree with her in her dislike for the massive influx of refugees. She specified that her friends are “secular Muslims.” Roberta also introduced us to her friend who was also setting up for the protest. She said he is half Jewish. We inquired several times if there were other people in her organization who are antisemitic or extremist and she repeatedly said no.

I admit that a lot of things she said seemed to me to make sense. I am pretty sure I would have mixed feelings about allowing any group of 1.1 million asylum seekers in just one year into my country. I suppose even if a group was comprised of the nicest, safest, most productive people on earth and didn’t require billions of Euros in government assistance, I still wouldn’t love it. Germans now feel less safe, they feel they are being taken advantage of and feel the government is not fixing the problem.

Near the end of the conversation she made a statement I also often hear in the United States that upsets me. She said something like, “Just read the Koran. It says how the Muslims hate everyone and want to take over the world.” What was this PEGIDA? What are they truly about?

I loved visiting Munich, but I’m glad I don’t live there.

Question: Does Donald Trump scare you?

Noah Graff is a used machine tools dealer for Graff-Pinkert and has been Features Editor at Today’s Machining World for 10 years.

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