Stephen DUBNER: So, you are, as I understand, a staunch vegetarian who’s also a staunch libertarian. I don’t think that’s a big club, that crossover.
John MACKEY: I did meet somebody a few years ago that said they were both. I’m not totally alone.
John Mackey, the co-founder and C.E.O. of the Whole Foods supermarket chain, seems to be comfortable with contradiction — or at least what may look like contradiction to the rest of us. He is a 67-year-old vegan and daily meditator who also lionizes free-market icons like Milton Friedman and Ayn Rand. He speaks out against factory farming; he’s also called climate change “perfectly natural and not necessarily bad.” A New Yorker profile of Mackey once declared that he, “can’t help but speak his mind, out of which spring confounding ideas and conventionally irreconcilable contradictions.”
MACKEY: Look, I just show up in an authentic way everywhere I am. I think that’s the best strategy in life.
DUBNER: Did it take you a while to show up always as your authentic self?
MACKEY: Of course. It’s a skill. You have to practice authenticity. It’s sort of natural to tell lies, even little lies. We learn to dissemble at a very young age. We are also very much afraid of disapproval from others. It’s really obvious today because there’s a fear of being canceled. If you say the wrong thing, you get a Twitter mob after you and the next thing you know, you might lose your job. So people begin to pretend to be something they’re not, because people are scared.
So, being authentic is not necessarily an easy thing to do. And I just try to be authentic and careful. Meaning — context, who am I talking to? So, I’m still being authentic. I’m not dissembling or misrepresenting myself. But then again, I’m not saying absolutely everything I’m thinking every second.
DUBNER: So, “authentic but careful” sounds to me like a razor’s edge.
MACKEY: It is a razor’s edge. You have to be really conscious.
“Conscious” is John Mackey’s watchword these days. Some years back, he wrote a book called Conscious Capitalism, which argues that profits and purpose should be fully compatible. Mackey’s follow-up book, published this fall, is called Conscious Leadership. Today on Freakonomics Radio, we see that the razor’s edge can get very sharp very fast.
MACKEY: Stephen, I really don’t like where this interview is now going.
And when it comes to leadership today, Mackey sees a glaring paradox:
MACKEY: America desperately needs heroes to show the way, but the heroes that show up are attacked.
Mackey himself has been on the receiving end of several attacks.
MACKEY: Every time you get a scar, you try not to do the same stupid thing again.
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In 1978, John Mackey borrowed $45,000 from family and friends to open a health-food store with his then-girlfriend in a Victorian house in Austin, Texas. He was a college dropout with no real business experience, but he did have access to $45,000 and an evangelical zeal for natural foods. This coincided nicely with a rising trend in healthier eating. Fast forward about four decades, and Whole Foods was a publicly owned corporation with about 500 stores in North America and the U.K. But its stock price was falling. Big, mainstream grocers like Kroger were cutting in on their organic and natural turf. Stores like Trader Joe’s and Sprouts were appealing to similar demographics, but with lower prices.
In 2017, an activist hedge fund called Jana Partners bought a big chunk of Whole Foods stock and pushed it to generate more profit. John Mackey, in a burst of typical authenticity, called the hedge fund “greedy bastards.” They plainly weren’t the kind of people Mackey had in mind when he talked about “conscious capitalism.” Soon after came an even more surprising state of consciousness when Whole Foods was bought by Amazon.com for more than $13 billion. It was the largest acquisition to date for the so-called “everything store.” When I interviewed John Mackey in early October, I began by asking how his job had changed since the Amazon purchase.
MACKEY: Covid has changed everything, but I am still pretty involved. I mean, I’m still C.E.O., I’m still paying a lot of attention. Whole Foods is still my life.
DUBNER: Where are you, by the way? Are you still in Austin?
MACKEY: I am in Austin, Texas, in our corporate headquarters with about 50 people total out of 1,000 that could be here.
DUBNER: What’s that like?
MACKEY: I get a good parking space every day.
DUBNER: I’d like to think you had pretty good parking before?
MACKEY: Whole Foods, first-come, first-served. No special privileges.
DUBNER: Get out of here — really?
MACKEY: Of course. Why would you do it any other way? If you want to create solidarity — people get there early, they get the good parking spaces. Fair is fair.
If the pandemic had happened a few years earlier, or if the Amazon sale had not already gone through, Whole Foods might have taken a bigger hit than they have. But the Amazon partnership meant that Whole Foods was already geared up for online ordering and delivery. This has protected it better than many other businesses that are suffering.
MACKEY: Just to be clear, 2020 has been a terrible year. And make no mistake about it, Whole Foods has not been hit the same way those businesses have been hit, but it’s still been very difficult for us. We closed down our fresh food bars, our salad bars, our hot bars shut down. Our prepared foods, which is a big part of our sales, fell 75 percent initially.
Trying to balance productivity and safety, Whole Foods also had some friction with their workforce. In March, some employees held a one-day sickout, pushing for better sick pay and health-care coverage, especially for part-time workers. Whole Foods responded by temporarily raising wages.
MACKEY: So it’s been very challenging. And we have had people get sick — team members get sick — and we’ve had a few people die. So it’s a tragedy. It’s a terrible thing. It’s slowly coming back, but it’ll be a while, long time before we get back to where it was pre-Covid. We saw our perishable foods like meat, seafood, produce, dairy — those all went up a lot, a tremendous amount, because restaurants mostly were closed down.
DUBNER: And did you have supply-chain problems or were you able to repurpose from the restaurant-supply chain?
MACKEY: We had supply chain problems, because the stuff that goes into restaurant supply chains are usually not usable by consumers.
DUBNER: Because of packaging or because of size?
MACKEY: Yeah, size. Take toilet paper. Toilet paper is such an interesting thing because studies show that, on average, Americans do about half of their bathroom work not at home. And then all of a sudden it was about 100 percent at home.
DUBNER: The history of corporate acquisitions is not necessarily a history of parallel joy between the acquirer and acquiree. And often people who have founded firms, that’s not an easy fit necessarily once there’s an absorption. I’m curious how that’s been for you.
MACKEY: One way to think about it is Whole Foods had done 23 acquisitions ourselves. So, I understand well what you’re looking for with the company that’s coming in. And mostly you’re looking for the acquired company to be excited to be part of the larger firm, to start talking in the “we” language instead of the “us/them” language, to figure out what the acquiring company wants and then try to make sure that you help give it to them.
I also know what it’s like to be on the other side. I know what the acquired company wants. They mostly want to be respected. They want to feel that they’re valuable and that they’re not inferior. There’s a strong sense of inferiority. There’s almost an attitude that can happen of — the acquiring company is like, “Well, we’re better than you because we acquired you.” And the acquired company is thinking, like, “We must not be as good as them because they acquired us.” You have to be sensitive to that, both when you’re the acquirer and when you’re the acquiree.
In this case, the acquirer was one of the best-known companies on the planet. And Mackey’s new boss, Jeff Bezos, was known for being at least as particular and driven as Mackey.
MACKEY: It hasn’t been as big a switch as you’d think. People always ask me, “How is it, like, to have a boss?” And that completely misunderstands the way most corporations operate. I mean, I’ve always had a boss. I always reported to the board of directors at Whole Foods. People had this wrong stereotype that the C.E.O. is like a god or something. The media makes a big deal out of abuse of power and acting like the big shot. And that’s just never been my style. I always try to be a servant leader. I’m serving the higher purpose of the company and the stakeholders. And these are the things I had to get clear with Amazon before we merged.
I had to get clear about our purpose and our core values and our mission. Are we going to try to integrate those or are you going to leave that alone? No, they weren’t going to try to change that. What about our culture? Are you going to try to assimilate us into Amazon and we will lose our identity? No, we don’t want to do that. So Whole Foods has changed and evolved, to be sure, but in a respectful way. I always use this analogy: When you get married, do you change?
MACKEY: And the answer is, “duh.” If you don’t change, you’re going to get a divorce. So Whole Foods is changing, not because Amazon’s cramming a bunch of things down our throat, but because they do a lot of things that we want to take in.
DUBNER: You’ve said in the past that Whole Foods ran more by intuition and gut, and Amazon more by empiricism and data. Obviously there are elements of both which are very, very good. And there can be a case where if you over-rely on either, that can be bad. I’m curious if there’s anything significant that you learned from Amazon operations that you maybe wish you had known or believed in 20 or 30 years ago?
MACKEY: Absolutely. I’ll give you a trivial example. Every retail food business has what’s called shrink, and shrink can mean spoilage. Maybe it’s employee theft. Maybe it’s shoplifting. Maybe you’re getting cheated by your suppliers in some way. But there’s always unexpected losses that you can’t fully account for. And one of the things Amazon early on did is they said, “We need to track all of the shrink and we need to compare stores so that we can get the data that we need to see where the problems are, so we can get better at it.” Now, that seems kind of obvious, doesn’t it? But we didn’t do that. We kind of tracked our spoilage, but not in a systematic way. And we didn’t do comparisons between stores.
DUBNER: And why didn’t you do it?
MACKEY: Well, we just figured that you’re always going to have some spoilage and it’s the cost of doing business. And the idea that you could reduce this cost seems rather obvious, but we didn’t work at it in a systematic fashion. So now we are. Not surprising, now that we paid more attention to it, we’re reducing our shrink pretty much in all those areas.
Reducing shrink is of course one way to drive down costs, and driving down costs is a basic tenet of the Amazon business model. And now the Whole Foods model too. This has meant lower prices at Whole Foods, which has been well-received by customers — especially those who used to be scared off by the “Whole Paycheck” nickname. Other changes have been less well-received. A new dress code, for instance, which forbids Whole Foods employees from wearing clothing with any sort of slogan or flag. Whole Foods used to be the kind of place where employees let their freak flag fly; it’s based in Austin, for goodness’ sake. And John Mackey himself had always seemed to champion individuality and the self-awareness that comes with it.
DUBNER: So, there was a passage from Conscious Leadership I was particularly taken with. You write “When I look at Whole Foods Market, I see my strengths well-represented. But the organization also mirrors back to me my weaknesses. For example, I tend to be a very creative person who’s good at coming up with innovative solutions and new ideas. The shadow side of that strength, however, is that I frequently don’t pay enough attention to the details.” So, I’m curious whether you have advice for the average person who sees that they have a set of things they do really well and another set of pretty important things that they don’t do well. Do you not worry about those things you don’t do well and find other people to do them? Do you really work on those weaker parts of yourself?
MACKEY: I think the answer is both, not either/or. However, part of self-awareness is just being conscious of the things that you’re really good at and things that you’re not good at. And building a team doesn’t mean hiring people or promoting people who are like yourself, because a team needs to have a diverse portfolio of skills. I mean, we talk a lot about the importance of diversity, but we’re putting that in the context of diversity of ethnicity or gender or sexual preferences or whatever. But from a team standpoint, what you’re really looking for is diversity of skill sets. And because I am more self-aware than many leaders, I recognized that I’m not good at some things. I need to make sure the people that have those skills and talents are on the team, because they compensate for my weaknesses.
DUBNER: Can we talk a little bit more about that notion of diversity? Because what you said strikes me as something that I think a lot of people understand but never talk about, which is, most of the moves that people make toward diversity these days are based on diversity of what economists call “the observables,” the characteristics that are easily seen. And as you said, you can kind of sort people, whether it’s ethnicity, gender, etc. But the unobservables are, I think, hugely important and harder to cast for. So, that’s the diversity of political or religious or philosophical ways of thinking. So, assuming that you do want to build an organization that has full diversity, not just people don’t all look alike and so on, but people actually think differently, how do you do that?
MACKEY: You know, Stephen, that’s such a great question. And first, I want to say how tricky it is to do that. You’ve got to think of diversity in terms of being a polarity. You need diversity, but you also need continuity. You need similarities, because let’s say you had nothing but diversity in language, well you couldn’t communicate with each other, right? If you have too much solidarity though, you have a groupthink. The team needs diversity in the right ways. And it’s not, as you say, the superficial ways people are diverse. It’s about diversity in thinking in emotional intelligence, spiritual insights, creativity.
DUBNER: I would think that the opportunity cost of not casting for that holistic diversity is pretty huge. And yet I don’t hear a lot of firms or institutions talk much at least about pursuing it.
MACKEY: I agree with that, and what many people tend to do is hire people that they are most comfortable with, people like themselves. Because they’re insecure, they lack confidence. They’re afraid to promote somebody that’s smarter than them, because maybe they’ll take their job. So they tend to promote to feel safe. But then, if you do that, you’re going to sub-optimize, and eventually you’ll probably be pushed out as the team leader.
DUBNER: So, Whole Foods practices wage transparency, which, as I understand it — pretty much everybody within the firm can know what everybody else is making. Assuming it works well, why don’t more firms do that?
MACKEY: I think there’s two reasons firms don’t do it. The first one is that they have something to hide. The second reason is simple envy. They believe that this is going to stoke envy so it’s better to try to keep it hidden. I believe envy can be a problem, but I think about it differently. When you reveal a pay structure very transparently — first of all, sometimes things aren’t just. And people will complain about it. And that gives you an opportunity to correct it.
At other times though, it is correct, and you can defend it. And then you’re pointing out to people what the organization most values and rewards. And it gives people something to strive for. “Wow, I had no idea that a coordinator could get paid that much. I want to be a coordinator.” Or, “I really want to be a store team leader, because I had no idea that including their R.S.U.s — the restricted stock units they get from Amazon.” I mean, they may be making well over $100,000. And if you don’t have a college degree, that’s something to aspire to.
John Mackey speaks from some degree of experience here, in that he didn’t complete college. He’s now worth more than $75 million. It likely could have been a lot more: since 2007, he’s taken a $1 salary and no bonus or stock grants. We should note that Mackey came from a family that knew how to make money. His father, Bill, was an accounting professor who, when John was a teenager, became C.E.O. of a health-care company that in the 1980s was bought for nearly a billion dollars. Bill Mackey was also one of the original investors in Whole Foods.
When John Mackey opened that first health-food store in the Victorian house, he chose to not sell the kind of foods that he doesn’t eat: sugary or processed foods; meat, poultry or seafood; even coffee. But that didn’t work out so well. After a couple years, he gave in and expanded his offerings. It was a tradeoff he was willing to accept. By widening the options, he could make natural and organic food available to more people. It’s the kind of tradeoff every business has to consider at some point. But Mackey thinks that modern capitalism accepts far too many tradeoffs; he likes to embrace a different model:
MACKEY: Good for you. Good for me. Good for all of us.
It’s called the win-win-win model.
MACKEY: That is a philosophy that can transform our world. Think about win-win-win and ask yourself how is that not a complete ethical system?
But most businesses, Mackey says, don’t think win-win-win.
MACKEY: The metaphors that we use to think about business are hyper-competitive models. And in general, people in America think in terms of win-lose. They think in terms of somebody’s gain is somebody’s lost.
And why is this the default model?
MACKEY: I think a likely explanation is that we evolved as tribal animals and we identify with our tribe, and what’s not our tribe, we should kill. And so, part of the human journey has been expanding our tribe and making it bigger. A lot of the polarization we’re seeing in the United States is tribal, group differences. We can be very socialistic in our families and in our tribe. But when we get outside of that, we’re not quite as generous and as compassionate and caring.
In his books, Mackey discusses managing personnel from a win-win-win perspective. This isn’t easy. As he writes, “People do far better with positive feedback, praise and appreciation. So that should be the emphasis. But if we’re not also giving the necessary tough but constructive feedback, then we’ll be doing a disservice to our team and to the team members.”
DUBNER: So, John, I think just about everyone struggles with this, whether you’re an employer or a parent or a teacher. What’s your best advice for delivering the useful criticism without breaking a spirit or discouraging people?
MACKEY: In my experience, criticism will only be received by people if there’s a high degree of trust. If there’s trust and people know that you care about them, then their self-esteem is less threatened. Because self-esteem is not usually very high with most people, you have to be very sensitive to the criticisms. When I tour our stores, because I am the founder, the C.E.O., I have a larger-than-life impact on the team members. They want “Daddy” to really love the store, and they don’t want criticism. I know this. So what I do is I give nothing but praise when I’m in the store. And if I see some problems, I might tell the store team leader, kind of one-on-one. But I try to not offer criticisms when I’m there, because they’re just too powerful.
I can give 10 compliments, but the one criticism devastates the morale. And that’s because they don’t know me well enough to know they can trust me. If you’re a parent — so many parents, mostly they correct their children all the time, “Don’t do this. Don’t do that.” And even though the child may feel it’s loved, the child experiences the parent usually criticizing them. That’s very unfortunate, because that makes the child less secure, afraid to interact with the parent. I mean, I remember when I was growing up, for example, bringing in a report card one time, all A’s and one B, and I was really proud of it. And my father said, “What are you going to do about that B?” And that was devastating, because I thought he’d be proud of me.
DUBNER: So how’d you respond to that in the, let’s say, short run?
MACKEY: In the short run, I was first hurt and then I was angry. It’s like, I can never make him happy.
DUBNER: And not inspired to say, “Gosh darn it, Dad’s right, I gotta get rid of that B.”
MACKEY: No, and I think that’s because I experienced him mostly criticizing me. Here was a time I thought maybe would be different; I’d get praise. If my dad always praised me and I felt that unconditional love all the time, and if he came in and said, “What are we gonna do about that B?” I would have responded very differently. I would have responded, “You know what, Dad? I’m going to take care of that B. Believe me.”
DUBNER: So, no offense, you haven’t really given me any actionable advice for delivering the criticism better, other than—
MACKEY: I’m building up to it.
DUBNER: All right. Okay.
MACKEY: I’ve given you the most important thing.
DUBNER: Gain trust, which is a long process.
MACKEY: It is a long process. So we should be very judicious in our criticism. An idea I took away from Ken Blanchard’s One-Minute Manager, which, I guess, dates me, because that book may not be in the print anymore. He just said you should catch people doing something right. So, I definitely believe in positive reinforcement. And then if you do enough positive reinforcement, people are going to be in a place where they can receive the critical feedback. And that gives you permission to give negative feedback. That’s actionable. So we just need to be careful about it. And if you can’t do it, you’re going to be the type of leader that people avoid.
* * *
DUBNER: So, there’s a question I wanted to ask you for a long time, and it has to do with a phenomenon known as the tall-poppy syndrome. You ever heard that phrase?
MACKEY: Of course, absolutely.
DUBNER: The first time I heard the phrase, it was something along the lines of, “It’s the tall poppy in the field that gets cut down. Don’t get above your raising.” But anybody who accomplishes becomes a target, obviously. It strikes me that you might get praise for the million things you do well or right, but you get a lot more attention for things that are perceived as mistakes. And people are much more likely to come after you when you’ve acquired a status, or stature, as you have.
So, I wanted to ask you about that in the context of founding and running Whole Foods and some of the things that you have done and said that do irritate people. And I’m really curious to know how that tall-poppy syndrome has affected the way you move through life. Has it made you wary? Is that what drove you to work on your own consciousness and so on — to deal with that?
MACKEY: I have a lot of younger entrepreneurs ask me this type of question, because what happens is, you begin to first succeed in pretty much anything is you stoke envy. And the tall-poppy syndrome, you’re really talking about envy. And the people that achieve the most actually help humanity the most. One of the paradoxes about the United States is we idolize celebrity. And yet, at the same time, we love to see those celebrities fall from grace. We love to see, as you say, the tall poppy get chopped down. It kind of reassures people that even striving for that type of success isn’t worth it, because look what happens. It helps people feel better about themselves.
I mean, at an early age, to be honest, I felt a lot of envy towards myself. I would be a teacher’s pet in school, and I’d get beat up after school because people were envious of me. So I would start to be kind of a smartass. And that’s actually carried over into my adult life, where I’m a bit of a smartass. So you have to learn to deal with envy. But I feel like I’m in this sweet spot in life. I have a little bit of celebrity, but I’m seldom recognized. I don’t have to have bodyguards. I don’t have to hide out. It’s perfect.
DUBNER: All right. Well, let me let me take you out of your sweet spot for a minute. In your career, over the last, let’s say, 15 or 20 years, there have been a series of incidents or proclamations that get some people really upset. In one case, you engaged in some online sock-puppetry, right? You were praising Whole Foods — No? Is that not the case?
MACKEY: A completely incorrect narrative.
DUBNER: All right, tell me the correct version.
MACKEY: The correct version was that I posted on a screen name on Yahoo! for about eight years. Everybody took a screen name. So I wasn’t trying to hide my actual identity. And if you read all of those postings, which were about 1,400, I mostly was defending Whole Foods. It was something I did for fun. You have all these shorts on there, and I would defend Whole Foods against their criticisms.
DUBNER: We should just say “shorts” are people who were betting against the company.
MACKEY: Betting against stock. And remember, I’m not doing that as John Mackey, C.E.O. of Whole Foods Market. I’m doing it under a screen name called Rahodeb.
Rahodeb is an anagram of “Deborah,” the name of Mackey’s longtime wife. Under this screen name, he championed Whole Foods stock, sometimes at the expense of a rival health-food chain called Wild Oats.
MACKEY: That’s right. I did criticize Wild Oats about six times in an eight-year period.
Whole Foods went on to buy Wild Oats. The details of Mackey’s online activity emerged in a court document filed by lawyers for the Federal Trade Commission, which was trying to prevent Whole Foods from buying Wild Oats, out of concern the natural-food market was becoming anti-competitive.
MACKEY: It’s a ridiculous story because nobody named Rahodeb could move the stock of anybody. And the criticisms I offered were so few and far between. And I’d say they were accurate criticisms. But this idea that John Mackey ran down the stock price so Whole Foods could buy it cheaper is completely a false narrative.
DUBNER: I guess the component that struck me as disingenuous is if I’m, let’s say, the board of Whole Foods and my C.E.O. is going to go defend us, I want him to do it under his name.
MACKEY: I just saw it as play. It’s something I did for fun. I like to debate. I’m a debater. I debate actually several times a year in a formal way. It’s hard for people to see, because they think of C.E.O.’s as these super-serious people. It’s all about play. I was just playing like a little boy and doing it in an innocent way, nobody was getting hurt.
DUBNER: But it stuck to you, to your reputation.
MACKEY: It did. I learned a valuable lesson.
DUBNER: Does that bother you to this day that it stuck to you? Not that you did it necessarily, but that it put a mark against you?
MACKEY: Does it bother me? I can’t do anything about it. So, it’s kind of like as you get older, I have scars on my body. I got them. I can’t get rid of them. But you know what? Every time you get a scar, you try not to do the same stupid thing again. So I learned a valuable lesson from that, which is, I can’t escape who I am, even when I’m just pretending to be somebody else. Because there’s a risk of it being found out. So that brought more integrity pretty much in everything I do. I just assume everything I do and say is going to be public. So that’s made me more careful. So, no, I’ve never posted on another bulletin board since then.
DUBNER: Now, a couple things that you said in subsequent years, talking about labor unions, you compared them to herpes. You said “it doesn’t kill you, but it’s unpleasant and inconvenient.” And then talking about Obamacare, you equated it in some degrees to fascism, as a kind of top-down requirement that’s not for the greater good.
MACKEY: Stephen, I really don’t like where this interview is now going. I don’t want to defend all the things that I said 20 years ago, 30 years ago, 40 years ago. Because that’s a very small part of my life. And these are scars. If you want to talk about the lessons I might have learned from those things, I’ve just learned to not be quite as outspoken in the world. That’s the biggest thing I’ve learned.
DUBNER: So, I appreciate that. Actually, what I did want to ask was — and this is still in the context of this tall-poppy question — how disturbing or upsetting is it when people get so upset about your expressing an opinion that if you weren’t the tall poppy, would pass unnoticed? However, when you’re the C.E.O. of something like Whole Foods, they become the headline. And everything else that you’ve done to build the firm seems to take a back seat.
MACKEY: Well, it’s like — I’ve been doing this for 42 years. The herpes comment was made 30 years ago.
DUBNER: Wow. That stuck.
MACKEY: It only stuck because it kept getting repeated. And again, I know this is going to sound weird, but it was play. I was making a joke. When I think back on it, that was an unfortunate thing I said. It was meant to be funny. We now live in a time where we’re judged by every little mistake we might have made in our lives. Hey, listen, I have made plenty of mistakes. That was a mistake. I regret that. I wish I could un-say that. I didn’t mean to harm anyone. I meant to amuse people. And now it’s a scar.
DUBNER: But in terms of the fact that the mistakes stick so hard, and this goes back to what you were referring to earlier about the number of compliments you need to give in order to help cushion the blow from one critique, there’s this line of research called “the power of bad” that measures just how influential bad news is for most people, and how good news will often go unappreciated. Having experienced your success, which is massive, with these scars, as you put it, to kind of count against you on the other side of the ledger, what does that say to you about just the way that we think about our society and success and so on? Because it seems that we often make it really hard for people to build things and to prosper, because we like to pay attention to the occasional mistakes that they make and amplify them.
MACKEY: So, very good question. I kind of see where you’re going. And I think it’s a good path to take. I think I’m a particularly interesting target for people because Whole Foods and myself have proclaimed we should be eating a healthier way. Seventy-one percent of Americans are overweight and 42.5 percent are obese. Clearly, we’re making bad choices in the way we eat.
It’s not a sustainable path. And so I’m calling it out. But because I’m a tall poppy and some people take it as a personal attack, they want to attack back. It comes with the territory. If you’re going to be the tall poppy, then people are going to look for how you’re not perfect, and they’re going to want to tear you down. A lot of wealthy people just basically, they just hide out. They’re not coming onto podcast shows. They’re not in the newspaper. They’re not doing interviews. They are enjoying their wealth in anonymity.
DUBNER: What do you think is the opportunity cost of this fervor we seem to have for cutting down the tall poppies? I would have to think that there are a lot of people who would be more public — whether it’s in politics, in policy, running firms, whatnot — but the first thing they think about is, “Oh well, they’re going to say bad things about me that are mostly irrelevant,” but it still hurts.
MACKEY: I’m a student of American history, and we generally held up and admired our heroes, those who contributed a lot. And increasingly today, there’s nobody that gets held up that’s not attacked. I just can’t think of almost anybody that’s been a president or has been a celebrity for very long, that doesn’t become hated.
DUBNER: At least by half the country.
MACKEY: Yes. The ironical thing is America desperately needs heroes to show the way, but the heroes that show up are attacked. And it’s a particularly interesting thing going on right now in the country. So, I’m glad we’re having this conversation. I’m just sorry my scars are being revisited. My P.R. team is going to say, “Don’t ever talk about that stuff, John. We told you not to talk about it.”
DUBNER: Well, I hear where you’re coming from, and I think I empathize. I try to empathize. I mean, look, they are out there. But I also wanted to hear about them as a scar, and how that kind of thing will discourage other people from behaviors that might be prosocial behaviors. You think about the kind of person who’s going to get involved in politics today, it seems you have to either be nuts or so egotistical that you don’t care that people say things about you.
MACKEY: Or both.
DUBNER: Yeah. Or both. And that’s not good for a country.
MACKEY: No. I mean, it honestly takes a lot of moral courage today. And maybe that’s one of the arguments that we’re making in the book for conscious leadership. America needs conscious leaders who lead with love, that have integrity and are seeking to find the higher ground and help America move past this very challenging historical time we’re in. I don’t want to go into politics. But I’m out here speaking to you and I’m willing to let my scars come back in the public realm a little bit. And there you go. I’m paying a price for it already. I’m being attacked a lot. But you know, I want to make a difference. I want to help people.
DUBNER: Let me ask you a question about one of the biggest and most intractable public policy and economic problems in our country is health-care coverage, the cost of health care, access, etc. We are one of the few, if not the only wealthy country in the world that ties health-care coverage to employment. I’m sure you know that history and have thought about the shortcomings. Can you talk about that? If you could turn back the clock to pre-World War II and arrive at a solution like other countries, I don’t know, maybe you’d like to, but I’m just curious what that original arrangement produced that you think is deleterious to the country.
MACKEY: Of course, you are back on a scar for me, since I got blasted back when I wrote that op-ed.
The op-ed Mackey’s talking about was published in the Wall Street Journal in 2009. It was headlined “The Whole Foods Alternative to ObamaCare.” Mackey called for “less government control and more individual empowerment,” and he argued that “equal access to doctors, medicines and hospitals” should not be considered an “intrinsic ethical right.” Moreover, Mackey wrote that many of our health problems are “self-inflicted” and could be prevented with better lifestyle choices. The piece enraged some readers and there were boycotts of Whole Foods.
MACKEY: What we should do in the United States is find a win-win-win solution. The win-win-win solution, to me, has to be one that keeps the efficiencies of the marketplace. People that think we have a capitalistic health-care system right now don’t understand free markets. Health care is the most regulated industry in the United States. We do not have free-market health care, and yet we know we need to have universal coverage, that we need to take care of our poorest, oldest and weakest people. What I would do if I was president, I’d set up a commission to study the most successful health-care systems that are out there. And the two that stand out to me are Singapore and Switzerland.
Singapore’s universal coverage is based on the idea that patients should pay for routine care, and reserve insurance coverage for large and unexpected costs. One reason this system works well is that obesity, smoking, and alcohol and drug abuse are much less common in Singapore than in the U.S. The Swiss system, meanwhile, is highly decentralized, with a requirement to buy insurance from private nonprofits and the option to upgrade with supplemental private insurance.
MACKEY: In some ways, Obamacare tried to take some of the elements of Switzerland’s health care, but they did not go far enough. I do think there are good models that work, that are out there. But we’re stuck in this intractable conflict between different political worldviews. We’re not looking for the win-win-win solutions. We’re looking for win-lose solutions — my way or the highway. And it’s created a lot of anger, a lot of disappointment, a lot of frustration.
DUBNER: There are those who argue that our political system is essentially a duopoly that, like the Yankees and the Red Sox, they thrive on being enemies but without each other, they’re nothing. And so we’ve arrived at this moment where, when you say win-win-win solution, that sounds great in theory. But can you see any way in the next five to 10 years where that’s a reality in something like health-care legislation?
MACKEY: It’s possible if we have conscious leaders. We’ve done it before. The big social programs that we have, they were bipartisan. Think about some of the biggest changes. The Civil Rights Act was bipartisan. Social Security was bipartisan. Medicare, Medicaid were bipartisan.
DUBNER: I mean, you’re talking 40, 45, 50 years ago. Have you seen anything in the past 20 years that suggests that in the next 20 we might get back to that politically?
MACKEY: It’s my opportunity to say that, “Yes, we can.” I mean, I’m not saying it’s going to be easy. I’m just telling you what needs to happen. The knowledge is in the culture to do it. It’s in our cultural D.N.A. already in America. We just have to find enough leaders, in both Democratic and Republican parties, that will work together for the greater good of all.
DUBNER: Can you see, however, a way to go down that path without relying on the Democrats and the Republicans to collaborate?
MACKEY: I mean, honestly, we talk about health care. The best solution is not to need health care. The best solution is to change the way people eat, the way they live, the lifestyle and diet. There’s no reason why people shouldn’t be healthy and have a longer health span. A bunch of drugs is not going to solve the problem. And I think there will be innovations. I’ll give you a trivial example.
So, I have an Apple Watch on, and one of the apps I have on the Apple Watch is Auto Sleep. So I get to monitor my sleep every single day. And it gives me feedback. I see how long I slept. I see the quality of my sleep. I see what my pulse rate was for the whole night. So it’s very interesting. Any time I drink any alcohol at all, my deep sleep almost completely disappears. I don’t sleep as long, my pulse rate goes up. So my body is trying to metabolize this alcohol. And I had no idea. And so now I consistently make the choice, “Yeah. I don’t think I’m going to have a glass of wine tonight. I actually think I’d rather sleep well.”
DUBNER: So, a few years back, you told The Wall Street Journal that you have one regret, or maybe one big regret — that you and your wife didn’t have kids. I’m curious why that’s your big regret.
MACKEY: I just love children.
DUBNER: What kind of dad do you think you’d be? You mentioned your dad with the expectations of the straight A’s in the report card. Do you think if you had had kids, you would have been a different type?
MACKEY: I guess it depends upon how old I was when I had the kids, right? Because I’m a lot more conscious as I’ve gotten older than I was when I was younger. I’m sure if I started at age 20 or 21, I’d have had more energy, but I’d lacked the wisdom that I would have had when I got older. So, here’s the thing: If I could do it all over again, would I make a different choice? And the answer is no, because I married the most amazing woman. And she has helped me so much. She’s made me so happy. It’s been such a great partnership, 30 years together. And so, if I could go back into the past, I wouldn’t change that.
There are a lot of other things I regret that if I could go back, I’d change them. For example, if I could go back and never have posted anything on the Yahoo! bulletin board, trust me, I would do that now. Or what I said about unions, I’d go back and remove that from history, but I would not go back and replace my wife with a woman who wanted to have kids, because I have really scored well on that one.
DUBNER: Tell me something that you believed for a long time to be true until you found out you were wrong.
MACKEY: So, you said I’m a staunch libertarian, I’m a staunch vegan, and “staunch” in that context is sort of pejorative, I think. And although I myself identify as a libertarian, increasingly, I identify as a “conscious capitalist.” I identify as a classical liberal. When you’re younger, you tend to be more puritanical in your political beliefs and your religious beliefs. You think you found “the truth.” And as I’ve gotten older, I just see that life’s complicated. And there’s not one set of values that are right and everybody else’s values are wrong.
So, I tend to be a lot more tolerant, a little more accepting. So, I think the biggest thing that’s changed is my sense that I’m right. I actually change my mind all the time. You know, one of the things that I changed my mind about as I got older: I realized most people aren’t rational. I got into my 50s before I figured out, just because you have the facts and the evidence and the logic, doesn’t mean anybody is going to change their mind. Confirmation bias is rampant. I don’t think changing your beliefs is any big deal. So, I’ve changed my mind a ton of times in life. And I’ll continue to do that, because I think it’s the best way to live.
DUBNER: So, I don’t mean to sound just like a fellow oldish guy who generally agrees with you, but since I do, my question is: Wouldn’t it be great if you and I, when we were younger — or even better, young people today, could appreciate the value of not taking a puritanical stance on so many things? But maybe that’s just a feature of youth. If it’s not, can you think of a way to dispense that message so that it trickles down a bit more?
MACKEY: Well, that’s why we write books, right? We try to pass our wisdom on to a younger generation, who mostly ignores us, because they tend to take advice from their own generation, just as we did when we were younger. But one of the things, Stephen, I’ve realized is that every stage in our life has a certain wisdom to it. Youth has a wisdom to it that old forgets about. Youth knows about play and adventures and having this fresh openness towards what life offers. There’s lots of other things they don’t know, but they do know that. And we tend to forget that as we get older. So every cycle in life, every stage along the way, has its own unique wisdom to it. And we should honor that and not be so quick to judge other people because they don’t see what we see.
To John Mackey, C.E.O. of Whole Foods, I say thanks for this conversation. It went in directions I hadn’t planned, and which I found fruitful. To Mackey’s P.R. team — I guess this is what happens when you are dealing with an authentic person. And Mackey is that. He’s also the author of Conscious Capitalism, which was co-written by Raj Sisodia; and Conscious Leadership, with co-authors Steve McIntosh and Carter Phipps.
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Freakonomics Radio is produced by Stitcher and Dubner Productions. This episode was produced by Rebecca Lee Douglas. Our staff also includes Alison Craiglow, Greg Rippin, Mary Diduch, Corinne Wallace, Daphne Chen, Zack Lapinski and Matt Hickey. Our intern is Emma Tyrrell. We had help this week from James Foster. Our theme song is “Mr. Fortune,” by the Hitchhikers; the rest of the music was composed by Luis Guerra. You can subscribe to Freakonomics Radio on Apple Podcasts, Stitcher, or wherever you get your podcasts.
- John Mackey, co-founder and C.E.O. Whole Foods.
- “Whole Foods Founder: ‘The Whole World Is Getting Fat,’” by David Gelles (The New York Times, 2020).
- “John Mackey’s Food for Thought,” by Alexandra Wolfe (Wall Street Journal, 2016).
- “Food Fighter,” by Nick Paumgarten (The New Yorker, 2009).
- “The Whole Foods Alternative to ObamaCare,” by John Mackey (Wall Street Journal, 2009).
- Conscious Leadership: Elevating Humanity Through Business, by John Mackey, Steve Mcintosh, and
- Conscious Capitalism, With a New Preface by the Authors: Liberating the Heroic Spirit of Business, by John Mackey and Rajendra Sisodia.
- The New One Minute Manager, by Ken Blanchard.
- The Power of Bad: How the Negativity Effect Rules Us and How We Can Rule It, by John Tierney and Roy F. Baumeister.