United Airlines, China and Course Corrections

This United Airlines travel poster from the 1950s sold for nearly $900 at a July 2017 Heritage auction.

By Jim O’Neal

In 1985, a man by the name of Richard Ferris, CEO of United Airlines, developed an innovative one-stop shopping strategy (Fly-Drive-Sleep) and then bought Hertz and Hilton hotels to add the two legs he needed. The expected synergies did not materialize, but he did manage to alienate his pilots and their powerful union. Rumors circulated that he had to travel incognito – under an assumed name – to avoid “last-minute mechanical failures” if his employees discovered him onboard.

In April 1987, barely two years into the new program, the angry pilots’ union made a hostile takeover bid, which effectively put the entire company “in play” on Wall Street. A compromise was reached for Ferris to resign, sell Hertz and Hilton, and change the company name from Allegis back to United Airlines. Everyone was happy except Ferris and the customers, who had suffered through two years of lousy service due to the squabbling.

The new UAL management aggressively decided to rebuild their frayed customer relations. Nancy and I were invited to go on a multistep goodwill tour to China and back. This was our first (of many) long, international flights to Asia that included a stop in Hong Kong, Guangzhou (Canton), Beijing, Shanghai and back to Hong Kong. Everything was first class-plus and I met some interesting CEOs from several major corporations. There were only 20 people (plus crew) on a specially outfitted 747 with fully reclining seats … a novelty in those days.

The food and beverage service was exceptional. However, what impressed me the most was the vastness of the Pacific Ocean. I could finally grasp what Ferdinand Magellan (1480-1521) and his crew encountered when they miscalculated, ran out of food and were so desperate they survived on a tasty dish of rat droppings mixed with sawdust. There were also stories of men gnawing on the ropes that lashed the mainsail. Only 18 men survived, and that did not include Captain Magellan.

The Pacific Ocean is the oldest of the world’s seas, a relic of the once all-encompassing Panthalassan Ocean that opened up 750 million years ago. It is by far the world’s biggest body of water – all the continents could fit easily within its borders, with ample room to spare. It is the most biologically diverse and seismically active, and holds the planet’s greatest mountains and deepest trenches. Its chemical influences and weather systems affect the entire orb we call home.

Most think of the Pacific Ocean in parts … a beach here … an atoll there … a long expanse of deep water. Captain James Cook wrote that by exploring the Pacific, he had gone “as far as I think it is possible for man to go.” Cook was not aware that it is 64 million square miles and humans are still exploring it.

Even the highly revered British Admiralty’s chart room bible “Ocean Passages for the World” still cautions sailors embarking on a crossing: “Very large areas are unsurveyed … no sounding at all recorded … only safeguards are a good lookout …”

The Chinese have always had good lookouts and now view the Pacific Ocean as their next area for expansion and dominance. They tell me to consider the past 4,000 years when judging their progress and to view the 20th century as an anomaly. They made a course correction to compensate for Mao Zedong and are now back on track for the next 1,000 years. They studied the flaws in our last financial system meltdown (greed and overleverage) and decided to create their own World Bank. They view our form of democracy with disdain since we appear irreparably divided over every single important strategic issue, with our economy bankrupt and elected officials in Washington, D.C., as the only ones with good health insurance, pensions and job security … hopelessly gridlocked.

They think it is better to have a strong leader and a navy capable of dominating the South China Sea with impunity. The great battle for the 21st century is essentially over. However, what they don’t understand is that we always find a way, then come together as needed. Winston Churchill put it best: “Democracy is the worst form of government, except for all the others.”

Intelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is president and CEO of Frito-Lay International [retired] and earlier served as chair and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].

Early Explorers Sailed a Vast Emptiness That Today Plays a Big Part in Our World

Abraham Ortelius’ Maris Pacifici map, circa 1589, called the first printed map to be devoted to the Pacific Ocean, sold for $6,875 at an October 2012 auction.

By Jim O’Neal

An author I have met (twice), Simon Winchester, just published a book, Pacific, which I was eager to read … until I saw the book review last October in The Wall Street Journal by Roger Lowenstein (ugh). However, a local critic judged it “superb,” so I may yet take a look.

My primary interest is due to the major role the Pacific Ocean has played in the history to date of our world and the growth in importance as Asia begins its dominance over the West in this century.

For starters it is big … very big.

Through the use of modern technology, we now know that it occupies 63.8 million square miles, 46 percent of Earth’s surface and it’s larger than all of the land areas combined. The Pacific Ocean also has slightly more than 50 percent of the world’s water by volume.

These are facts that were not known in the 15th or 16th centuries or even imagined by the bold sailors who ventured out in search of treasure (e.g. gold, spices, etc.).

In 1519, Portuguese explorer Ferdinand Magellan set off in five leaky boats in an effort to find a western route to the Spice Islands east of India, hence the name East Indies.

What he discovered was that between the Americas and Asia was a vast emptiness, more than anyone had ever imagined, or that was even thought possible on our “little planet.”

Today, we simply call it the Pacific Ocean.

It is likely that no one suffered more than Magellan and his crew as they sailed and sailed … in growing disbelief … across the Pacific in 1521. Since no one had anticipated just how vast this “endless ocean” really was, they had totally underestimated the provisions that were required.

As a result, they devised some of the most unappetizing meals ever served, à la rat droppings mixed with wood shavings. “We ate biscuit which was no longer biscuit, but powder of biscuit swarming with worms,” and “We also ate some of the hides that covered the mainyard … and often we ate sawdust from boards.”

According to the ships’ logs, they went three months and 20 days without fresh food or water. In the end, only 18 of 260 men survived the voyage, and even Magellan was killed in a skirmish with natives in the Philippines.

Eventually, they made it home – Juan Sebastian Elcano led the expedition back to Spain – and in the process they became the first people to circle the planet.

They were also the first people to realize just how big this planet is, and the dominant role played by the Pacific Ocean.

Jim O'NielIntelligent Collector blogger JIM O’NEAL is an avid collector and history buff. He is President and CEO of Frito-Lay International [retired] and earlier served as Chairman and CEO of PepsiCo Restaurants International [KFC Pizza Hut and Taco Bell].