H&R Block CEO, CMC Alum in Investor's Business Daily

"First you make ze money, then you develop ze conscience."

As much as I hated Bono's visit to Claremont McKenna, his quoting of a German man on the subject of philanthropy got me thinking.

But of course, much of Claremont McKenna has it completely backwards as anyone who has listened to President Gann knows well. She wants students to go work for non-profits instead of profit producing firms because presumably there's something ennobling about not making money.

I don't hold to that. And neither should you. Civilization actually does prosper on commerce, notwithstanding Justice Holmes's quip about how taxes are what we pay for civilized society. The leeches must always have a strong host, if only for their own survival -- though they rarely recognize it.

There are some acts of self sacrifice that boggle the mind and are truly worthy of note, if only because of their selflessness. Take the example of Tom Bloch, CMC '76, former CEO of H&R Block. Here's the story from IBD.

From Tax CEO To Math Teacher

BY TRANG HO

INVESTOR'S BUSINESS DAILY

Posted 10/14/2008

As the CEO of H&R Block (HRB) — America's top tax preparation firm that revolutionized electronic filing — Tom Bloch produced huge profits and earned nearly $1 million a year.

Despite his success and fortune, he gave it all up at age 41 to do what he saw as more fulfilling and beneficial to society: teaching math at an inner-city middle school.

His career change drew national attention in 1995. Oprah had him on her TV show, as did NBC's "Today." People magazine featured him, as did the New York Times.

They all quoted people wondering how a CEO could leave the firm that his dad built and take a 98% pay cut.

Bloch's answer? He borrowed one from the Dalai Lama on the meaning of life: Be happy and useful.

"I think when you find your calling and you follow your heart, you just become a more fulfilled person," Bloch told IBD. "I find that my work in urban education in a very, very small way (is) working at repairing the world. And what I learned over these years is that when you work at repairing the world, you repair yourself."

Bloch, 54, believes that had he been born to anyone other than the co-founder of H&R Block, he would have pursued teaching rather than taxes from the start. Henry Bloch and his brother Richard started the first firm of its kind in 1955 with a $5,000 loan from their aunt.

"My dad was a very average student in school. Yet he went on to be a business legend," Tom Bloch said. "He would tell you it was a result of really hard work combined with some luck… And he always looked at problems as opportunities to do better."

Bloch always looked up to his dad, and while growing up he focused on following in Henry's footsteps.

In his third-grade class in Kansas City, Mo., the teacher asked the pupils to draw a picture of what they wanted to be when they grew up. While other kids drew a fire engine or a police car, Bloch drew a picture of a man sitting behind a desk, with a sign above that read: income taxes.

Bloch didn't even know what taxes were, but he knew that one day he would take over the family business. He was so sure, he swept the offices and skipped school to go with his dad on business trips.

Immediately after graduating with honors from California's Claremont McKenna College in 1976, Bloch started working at H&R Block as a tax preparer in the Kansas City headquarters. He worked in every department and held several executive positions.

By 1989, he had scaled the ranks to president of the company.

In 1992, he replaced his dad as chief executive. He was 38 and on top.

Under his leadership, H&R Block's earnings rose every year. In just his first year as president he doubled earnings, from $100.2 million to $200.5 million.

As CEO, he oversaw the company's revolution of filing taxes electronically and pushed the Rapid Refund program, which gave clients their money on the spot.

Bloch believed he had to prove he was worthy of his position, that he didn't get where he was just from his dad. His drive helped him carry on the rampant growth the company enjoyed before he was in charge. Today the firm dominates the market — preparing one in seven returns filed with the Internal Revenue Service and running up revenue of $4.4 billion in fiscal 2008.

"I got to the point where personally I didn't need to make money. But I felt such pressure to continue the progress at H&R Block," Bloch said. "The company had such a strong record of growth and consistent improvement in earnings, and it became much more difficult as the company matured."

But success came at a cost to his health and family. He had trouble sleeping. He worried about work and spent little time with his wife and two sons, Jason and Teddy.

"He loved the people and he loved the job, but it was all-consuming," said Mary Bloch, his wife of 26 years. "It was really taking a toll on him, and I could see him dropping dead of a heart attack at age 50 unless he did something to change his lifestyle."

Bloch calls that change his most painful decision — especially since he felt he was letting down his dad.

"But the bottom line (was) I wanted to leave my own kind of legacy with my one and only life," he wrote in his memoir, "Stand for the Best."

In 1995, after 19 years at H&R Block, he resigned from his high-profile post. "I was disappointed and happy at the same time," Henry Bloch told IBD. "He had such a great job: CEO of a New York Stock Exchange company, making a lot of money. I couldn't see him giving that up, but my main interest was that he was happy."

After leaving the company, Bloch took classes at Rockhurst University in Kansas City and finished an independent program to get his teaching credential. He took that to a Catholic middle school, St. Francis Xavier, in the inner city and taught.

As a former businessman, Bloch wanted to improve education by applying free-enterprise concepts. He decided to create a charter school that operates autonomously from the local school district, adheres to higher standards and has the freedom to use an innovative program to meet individual student needs.

Result: In 2000, he teamed up with Barnett Helzberg, former owner and president of Helzberg Diamonds, to start University Academy, a tuition-free charter school in a poor area of Kansas City.

Helzberg donated $40 million to build a sparkling facility. State and federal grants cover the school's operations. Mary Bloch organizes a fundraiser that rakes in $300,000 to $600,000 annually.

More than 1,000 students from kindergarten through 12th grade attend University Academy. Its waiting list is as long as its enrollment.

In the first year, many students found the college preparatory curriculum so rigorous, they dropped out. Then the numbers improved. After five graduating classes, all but two students have reached college — a major feat for an urban school.

Bloch helps those students by staying in the classroom, where he teaches seventh-grade math and eighth-grade algebra."It is my responsibility as a teacher to motivate a child to be successful," he said. "And while it's true I don't have full control over that, I feel that I am not successful unless every child is achieving."

The Claremont Port Side and Saving the Whales

Abraham Gesner saved the whales by giving us kersone

The Claremont Port Side wants you to save the whales through increasing governmental power. (Maybe they got tired about writing about saving Darfur.)

Mr. Kyle Ragins would have you believe that

1) whaling is harming endangered species.
2) whalers employ inhumane practices.
3) whale meat is dangerous to humans.

On the second point first, aren't whalers supposed to be inhumane? They are after all whaling!

On the first point, there is widespread disagreement as to whether or not some whales are still "endangered." In the latest assessment by the IUCN (International Union for Conservation of Nature), several prominent whales species have been downgraded to not endangered. One such species is the gray whale and the southern right whale.

On the final point, it may well be true that whale meat is unhealthy -- though considerable debate remains -- but let us suppose that it is unhealthy. Privatizing the whales would mean that people would take greater care to ensure that their whales weren't contaminated.

Still, one might reasonably ask whether or not the threshold for PCBs was set too low. Japan has a limit of .5 ppm for PCBs. The U.S.'s Food and Drug Administration has a 2 ppm standard. Whales fall comfortably at .072 at their highest levels! As a reasonable person would know, it all depends just how much whale you eat. Still, it seems odd that anti-whaling activists make such a big deal over a limit of .72 when people in the U.S. routinely eat over that limit for swordfish.

Naturally, Mr. Ragins wants the U.S. to use its soft power to mau mau the Japanese into no longer whaling. Why that is in the interest of the U.S. is anyone's guess. Last I checked whales do not vote. (ACORN has had trouble registering them. They tend to be migratory and fickle voters. Given that their songs can broadcast for miles, they believe in free speech and would likely vote Republican and against the so-called Fairness Doctrine.)

But if one were so inclined to save the remaining whales, the smart thing to do would be to issue property rights. Save the whales? No, privatize and then farm them!

It isn't so far fetched an idea when it's properly considered. After all, capitalism and property rights saved the whales before. Abraham Gesner devised a method to distill kerosene from petroleum, guaranteeing that the whale for oil market would be vastly too costly to continue in its mass scale.

There is a reason that cows are not facing extinction and from what I'm told, cow and whale taste much the same when filleted. (The latter is a bit more fishy.)

Fortunately, this issue seems to be just one more that technology can help address, if only government got out of the way. It seems to have worked with elephants and ivory, in any event. It also worked with tiger farms.

In 1997, The Asian Wall Street Journal believed it was possible. If anything, the technology has probably gotten better. They wrote then,

Privatizing whales may seem farfetched, but in fact the technological obstacles to an ownership program are rapidly disappearing. Back in the heyday of whaling, it was simply not feasible to exert ownership over living whales, but the whalers did construct an elaborate set of rules that governed harpooned whales. Readers of "Moby Dick" will be reminded of clearly marked harpoons that carried different rights of proprietorship over a whale depending on the speed of the current and the type of whale. In 1993, scientists tracked a single blue whale for 43 days over 3,200 kilometers (1,984 miles) based solely on its individual song. Other advanced technologies such as satellites and unmanned submersibles could be even more effective if given the chance.

We could even use the information we learn about the whales to farm them.
Of course the Greenpeace nuts won't let us farm the whales. They'd prefer to have them live in the wild and therefore go extinct.