Colorado School of Mines
Commencement Address
May 4, 2001
J. Steven Whisler
Chairman, President and CEO
Phelps Dodge Corporation
 President of the Board of Trustees Erisman,
Members of the Board of Trustees, President Trefny, Dean Golden, ladies and gentlemen, and
our honored guests today - the Colorado School of Mines Class of 2001 - I'm delighted to
be here.
I am genuinely honored to be the recipient of this Honorary Doctor of Engineering Degree,
and to join in your celebration of the culmination of many years of work and study.
I am not sure why Dr. Trefny asked me to speak this morning, and I am sure that question
is shared by most of the faculty that ever had me in one of their classes. In fact, some
of them would surely argue that today I am receiving my second honorary degree from Mines.
I specifically mentioned Dr. Golden, the former Dean of the Graduate School who is largely
responsible for me being here. His telephone call 17 years ago - telling me I had now been
a graduate student for more than five years and that he would be forced, if not delighted,
to delete me from the student rolls if I didn't finish my thesis and get it approved
before the end of the semester - was undoubtedly the motivation I needed to graduate.
Actually, if the truth is known, this is the first graduation ceremony I have attended - I
did not attend my high school graduation nor any others - so I am not entirely sure what
commencement speakers do. Based on a little research, it appears my job this morning is to
impart brilliant words of wisdom.
In doing that research, I came across commencement addresses with titles like
"Paradox and Counter-intuition: Resolving the Ethical Dilemmas of 21st
Century Science and Commerce." If that is what people speak to at commencements, I
probably haven't missed much!
So, what I've decided to do is give you some observations, predictions, rules and pieces
of advice based on my 25 years of work experience. Now, my teenage son never takes my
advice, so I don't know why anyone else should, but here goes...
Rule Number 1. I work in the mining industry, and I will speak in its context, but
my comments are equally applicable to all regardless of your major or the industry in
which you choose to work.
Rule Number 2. You have graduated a great university, but most of what you have
been taught has very little value. This is the point in time when the Trustees and Dr.
Trefny look at each other mouthing the question of whose idea was it to have this guy
speak. Mines has an excellent reputation in the world, far better than most of you now
appreciate. Your degree will undoubtedly open many doors, and you should be both proud and
take advantage of that circumstance.
Unfortunately, most of what you have been taught will lose value rapidly. Thirty years
from now, much of what you will need to know is not known today. Far more important
questions are has Mines taught you how to think? To question? To resolve? If it has, then
you have received more than your money's worth. And as you demonstrate those abilities,
your Mines degree will escalate in value.
Number 3 is an observation: When I was a young person, the story lines of
television shows were based on real life. Today, real life mimics the game shows.
Take what's happened in the phenomenon of dot.com startups and New Economy companies. Two
years ago, many industrial companies were having a difficult time in attracting job
candidates because so many people wanted to play the real life version of "who wants
to be a millionaire" inside an Internet start-up. Today, people are lucky and
thankful if they haven't yet been "voted off the island" like in an episode of Survivor.
Rule Number 4 is a piece of investment advice. Given the stock market fluctuations
of recent months, a lot of people are unsure about whose advice to take when it comes to
their money. Personally, I subscribe to the investment theory of Will Rogers, who once
said, "Don't gamble. Take all your savings and buy some good stock and hold it till
it goes up. Then sell it. If it don't go up, don't buy it."
That is also good advice when speaking about careers, and leads me to Piece of Advice
Number 5. Pick a career that appeals to you, and stick with it. Choose it for the
right reasons. Ride the ups and downs - because like all of us you will have plenty.
Equity markets around the world have recently fallen significantly, and there is
widespread concern about the robustness, if not the health, of the worlds' economies. It
is for some of us, as Yogi Berra once said, "déjà vu all over again."
In 1984, Business Week magazine published a major story about our industry. There
on the cover of the magazine, above a photograph of a casket ... in big black, capitalized
letters was the headline, "THE DEATH OF MINING."
It was a very sobering piece. The reasons for the pessimism included shrinking markets,
huge debt, depressed prices, poor returns and the shift of production to state-owned
enterprises in the developing world. The article even went on to say that it was difficult
to see how my company, Phelps Dodge, could survive.
At the time, I was just graduated from Mines and found myself working in the Phelps Dodge
exploration office in New York City. To this day, I remember asking myself, "Should I
get out of this industry?"
I stayed because I liked it. I liked the people - decent, hard-working and fundamentally
honest and sincere individuals from top to bottom. I liked the fact that our product was a
building block of society. I liked the smell and feel of this industry - an industry that
just gets in your blood. It's small and intimate in size, yet global in outlook.
No two days are the same. Where you can go from meeting presidents and prime ministers one
day ... to salt-of-the-earth prospectors in the most remote parts of the world the next.
I don't believe for a second that I made a mistake 20 years ago staying in this industry.
And I am equally excited for each of you, as you begin your careers in what are sure to be
among the most transformational years in the modern history of industry. You too will go
through career ups and downs, and there will be times when you question your career
choice, your boss, your company, your industry - everything about your job. Think
carefully about your choices, and if you make changes, make them for the right reasons and
not transitory circumstances.
Speaking of careers and bosses, pay attention to Piece of Advice Six: The
difference between a successful career and a mediocre one sometimes consists of leaving
four or five things a day unsaid.
Rule Seven, and The Single Best Piece of Advice I Can Give You: Be lucky! You
create your own luck. Luck is when opportunity meets preparation. Preparation is nothing
but hard work, and it's solely within your control. The harder you study, work, think -
the 'harder you prepare - the luckier you are. Some say, "I have done all that but I
just have never had an opportunity." I like Secretary of State Colin Powell's view of
opportunity: it's not what you know or who you know - it's what you know when who you know
really, really needs it! In other words, you create your own opportunities.
This is a good time for Piece of Advice Number Eight: Be proud of what it is you
do.
Before the stock market took its recent dive, you heard amazing justifications for the
high valuations of technology stocks. Many investors seemed to believe the rise of tech
stocks was inevitable. The Priceline.coms, the Yahoos, the Qualcomms - driven by the
forces of fate and the future - were on an upward path into the new economy.
A year ago, I attended a gathering of CEOs that included those who run some of the best
known hi-tech companies in the world. For several days, I heard them pronounce how their
companies were changing the world, how they were making it a better place, and how the
hi-tech industry was superior to all others. I've also read news stories declaring oil,
copper and most base and precious metals unnecessary and totally useless in a society
driven by high technology.
While I was both annoyed and somewhat amused by the arrogance and naivete of the CEOs and
the uninformed reporters, these encounters left me with the sobering acknowledgement that
the resource industry's contribution to society really is being forgotten.
We have allowed the uninformed, the elitists and the extremists to take the high ground.
We have often conceded to them at every opportunity. We have become apologetic for what we
do and what we create. And what we create is real value to society.
We take a raw material out of the ground and turn it into something of worth. We create
value for our employees and our communities and for society as a whole.
Some people believe that our industry cannot compare to an Internet - based industry or
the computer industry - that we simply cannot measure up. I constantly read news articles
about how the computer is opening up the world for poor people in remote areas, and how
old industrial businesses, like mining, are dying.
The mother in Ethiopia trying to feed her children does not care a bit about the debate
between VHS and DVD! Try plugging a computer into dirt in India. For that matter, try
building a computer without copper, gold, silver and hundreds of other mined materials.
Mining and other basic industries do more for bettering the human condition, raising the
standard of living, and improving the quality of life than all of the e-businesses
combined.
In North America and Europe, there is a phrase - the "digital divide" - that
suggests that those without computers are significantly disadvantaged, and that the
digital divide is among the world's greatest global issues.
People who are struggling to survive would find that laughable. Those of you who have
traveled in very poor and undeveloped nations know what I mean. More serious than any
digital divide is what I call the "electrical divide" - the fact that 2.5
billion people throughout the world still do not have electricity. There is a nutritional
and hunger divide. There is a housing and transportation divide. There is a sanitary
divide, and an educational divide.
All of those needs - electrical, health, hunger, housing and education - are much more
pressing than whether a rural peasant earning the equivalent of $300 a year can receive
e-mail by computer.
All of this is not to suggest that technology is not important, or that the companies
inventing it should not be successful. They should be. And our industry's use of
technology results in some of the most technologically sophisticated operations found
anywhere. But our reason for being is just as worthwhile, if not more worthwhile, than
that of Amazon or Cisco or Intel.
On the basis of relative value to society, no one - NO ONE - should be more proud than
those in the mining industry. We provide the basic infrastructure on which strong
societies can be built. That is a tremendous economic and social and moral good. So if you
are going to work for Exxon, Chevron, BHP, Rio Tinto, Phelps Dodge, DuPont, Newmont or a
host of others, take pride in your work, your company, and your industry. Millions of
people's lives literally depend on it.
Opportunity Number 9 relates to something very important to the industries this
school has traditionally served. Today, the environment is not just a public issue; it
is a public value. The environmental movement forced us to address our societal
responsibilities, which is to our long-term benefit. As you move into positions of
increasing responsibility, be prepared to tackle this issue.
Creating economies that protect the environment and provide balanced growth for industrial
and hi-tech businesses is both critically important and difficult to achieve.
Just look at the current electrical power crisis in the western United States. For nearly
a decade, no new power generating plants have been built in California due to prohibitive
environmental regulations. Yet their population has grown by about 8 percent in that same
time period, and they are now considered the global hub of the hi-tech industry.
This summer, limited power supply in California is likely to result in power interruptions
to businesses throughout the West, and will threaten tens of thousands of jobs if power
supplies are rerouted to satisfy the high power demands of California residents.
California's success of the 1990s was falsely constructed on the belief that a modern and
highly developed society can grow its appetite for goods and services without continuing
to grow its supplies of power and natural resources. As they are now painfully realizing,
it takes a well-developed and maintained infrastructure system to run a healthy economy.
In spite of what our opposition might tell you, heavy industry - when well managed - can
be a positive force in both economic growth and environmental protection.
Piece of Wisdom Number Ten is develop a strong personal value system or philosophy
relating to how you live your life. Call it many things - the Golden Rule - personal
ethics - whatever. There simply is no reason for you to lie, steal or cheat-in business or
in life. Every one here can name leaders who did exactly that - starting with individuals
who have held the highest offices in the world. For most of your lives, you have had
repeated opportunities to test your morals.
You will encounter many more. So, as you embark on your next journey in life, set your
moral compass to a high standard and believe in it without exception. Trust me, you will
get lots of opportunities to use it.
When I completed my first year of law school, I had just finished my contracts course.
Impressed with myself, I described my newly found knowledge to a friend of mine,
describing such details as the need for consideration to make a contract binding and how
the lack thereof might make an agreement unenforceable. This friend, an old Colorado
cattle rancher who did not finish high school, listened politely, smiled and then simply
said, "Steve, all you need to know about contracts is you can't make a good deal with
bad people, and if you have to write it down you don't have anything to start with."
I cannot remember most of my contract law, but I have never forgotten those pieces of
advice, and I have tested countless propositions against them. They have never failed me.
And whether you describe it as a gut check, or a smell test, or what Phelps Dodge
employees call the value of "Doing What's Right" - one thing is for certain -
what goes around, comes around. Guide your life accordingly.
Don't ever underestimate the importance of this. A respected Indian friend, a self-made
multi-millionaire, described a person's reputation as like a piece of thread. The thread
is strong and will even stretch a little. But once broken it can never be fully repaired.
Yes, it can be tied back together, and maybe structurally is just as strong, but no matter
how fine the thread everyone can always run his or her fingers along it and feel the knot.
In the end, what you're left with is your reputation.
Piece of Advice Number 11. Never take the advice of anyone over the age of 50. When
I was at Mines, I used to say age 30, but aging, like change, is inevitable, so Rule
Number 12 is "always be flexible when making your own rules."
Faculty and family members, I value and respect your time. Graduates, I value and respect
your desire to get through the ceremony and on with the celebration, which brings me to
Rule Number 13: "Sit down when you have nothing left to say." If I have
gotten my messages across, it's my hope some of you will leave here enthused ... and the
rest of you will at least wake up refreshed.
Please accept my congratulations on your commencement. Good luck Mines Class of 2001!
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