Please register to access this FREE content.
Benedictine’s Thompson Center Honors Michael Haverty with 2023 Award, Esther George Provides Keynote Address
The speakers for the 2023 Thompson Medal Ceremony included (left to right) Stephen D. Minnis, Michael Haverty, John Welte, Esther George, Paul Thompson and Chris Thompson. Watch Ceremony Recording
As a retired business leader who had served on many boards and been involved in many community events, Michael Haverty admitted that he generally declines awards and recognitions these days. But when he was told of the Thompson Medal honor, named for his good friend, the late Byron Thompson, he immediately accepted, noting that Byron was “not only a great banker, but he was also a great man.” And the fact that the event took place on April 13, 2023, was another reason he was excited about it, as he felt his career had confirmed that 13 was his lucky number.
Benedictine College’s Byron G. Thompson Center for Integrity in Finance and Economics, in conjunction with the Thompson family and Country Club Bank of Kansas City, annually presents the award recognizing an individual in business who exemplifies integrity and competence, as well as making significant contributions to both their sphere of business and their community.
Benedictine President Stephen D. Minnis introduced Haverty, who grew up in Atchison, Kansas, and attended Catholic schools through grade school and high school. Haverty started his college career at Benedictine, then known as St. Benedict’s College, but transferred when the school dropped the football program. He ultimately graduated from the University of Louisiana-Lafayette. He earned an MBA from the University of Chicago and returned to Benedictine in 2008 to receive an Honorary Doctor of Humane Letters.
He was a career railroad man, starting as a brakeman for the Missouri Pacific Railroad. He then spent 21 years with the Atchison, Topeka & Santa Fe Railway, rising to be president of that company. He was recruited to take on a struggling Kansas City Southern Railway, becoming chairman, president and CEO of that organization. He was proud to have taken on the company when its stock price was $5.75 per share and noted that stockholders received $300 per share when the company was recently sold.
In his comments, he talked about how his lucky number throughout his career had been 13. It was July 13, 2000, when KC Southern first traded as a pure railroad holding company. Then, it was 13 years later, in 2013, when Haverty retired from the company. And today, he uses a personal email address that includes haverty13.
Paul Thompson, chairman and CEO of Country Club Bank and son of the Thompson Center’s namesake, also noted that 13 was a lucky number for the Thompson family, which was comprised of 11 children plus their parents, Byron and Jean. He even noted that back in the day, the family CB radio “handle” was “banker’s dozen.”
In his comments, Paul reminded attendees that the purpose of the Thompson Center and its Fellows program is to inspire young Benedictine students to be “faith-filled people of integrity whose own principled leadership will leave an indelibly positive impact on the world around them, not unlike the influence that Byron has left on his family, friends, industry and community.”
One of those students, John Welte, spoke at the event to attest to the inspiring work of both the Thompson Center and the example of individuals like Michael Haverty and Byron Thompson. Welte, a junior majoring in Economics and Philosophy, commented on the variety of opportunities he has had at Benedictine College, including going to the National Moot Court Competition in New York City. He noted the importance of these experiences in making him a well-rounded individual, and referenced Byron Thompson’s article in the 1955 Rambler, the college’s student newspaper.
“I could learn the theories of supply and demand from any college in America,” Welte said. “But as Byron Thompson said, this would just make me a dangerous man whose education is incomplete. At Benedictine, we are taught the tools of economic trade. But at the same time, we are taught Catholic social teaching that makes us morally mature.”
The program for the evening also included a keynote address from Esther George, the recently retired president of the Kansas City Federal Reserve Bank. She talked about the state of the American economy and built on the theme of integrity in finance and economics.
“I want to put a bit of a wider lens on today’s issues, thinking about some of the longer-term implications of what’s going on in the economy,” she said. “And I’m going to start with the event that we have now finally come to know as the global pandemic. The idea that we wanted to limit personal interaction out of health concerns really affected our economy in ways that we did not understand.”
She noted that while the federal government moved $6 trillion from its balance sheets to those of households, businesses, state and local governments, there were also supply chain disruptions that weakened supply and the Federal Reserve Bank was aggressively easing monetary policy all the way down to zero interest.
“So, the combination of all of that money coming into the economy at a time when supply constraints were very acute caused there to be these extreme imbalances between demand and supply,” said George. “You know well that when you get a kink between supply and demand, you get one thing. And we’re living with that today, high inflation.”
She said the Federal Reserve missed the inflation cues and is now reacting aggressively in the other direction to correct that.
“If you think back to just one year ago, March of 2022, over the last 12 months, the Federal Reserve has raised interest rates some 500 basis points, and it has begun very aggressively reducing its balance sheet as a way to get ahead of inflation expectations,” she said.
The inflation rate is still 5%, which she said is well above the Fed’s targeted rate of 2%. There are three things that she said continue to hamper the reduction.
“One of those is continued supply constraints, and I’m going to focus on labor markets there. The other is thinking about how much of that monetary stimulus relief money is still out there and poses the potential for keeping demand strong. And the last thing I’ll mention is just looking at fiscal policy today and where we are with trying to understand how much federal debt the United States can manage before it begins to be more costly,” George said.
She mentioned that feedback from businesses within the 10th Federal Reserve District indicated that the number one constraint, the number one concern they have, is finding people to fill the jobs they have. She said much of the tight labor market can still be attributed to the pandemic and the vast numbers who left the labor market, mostly those 55 and over who took retirement at that time.
“Unless something changes in a way that would cause an older cohort of workers to come back to the workforce, that will continue to be a constraint,” she said. She added that immigration is down, so that traditional avenue of filling in the workforce is not helping. And finally, the childcare industry was decimated during the pandemic and is not recovering, making childcare both hard to find and very expensive. This is keeping younger workers home to care for children rather than return to the workforce. She said higher interest rates would help bring workforce imbalances back in order.
The other thing she said the interest rate hikes would do is help bring spending down, but there is a reported $1 trillion in excess savings still in the economy from the pandemic and people are still showing a very high propensity to spend, rather than sit on the money. That is making the Fed’s job harder as increasing interest rates have not slowed the rate of spending as much as hoped. While manufacturing has slowed as people are spending less on products now, the service industry is booming as people return to travelling, dining out, attending events, and other things the pandemic restricted. George said it is not clear at this time how far the Fed will have to increase interest rates to bring that spending back into balance.
Finally, she mentioned the difference between monetary policy and fiscal policy. While the Federal Reserve is doing what it can with monetary policy, the legislative and executive branches of the federal government are responsible for fiscal policy, in particular managing the national debt.
“It looks like this will be the 20th consecutive year where Congress will not set a budget in a timely way,” she said. “We are looking out over the next decade and seeing the debt in the United States exceeding the size of our economy.”
George said interest expenses are poised for the next five years to exceed some of the country’s largest spending categories, like defense and Medicaid. She said policymakers need to address these issues in a timely manner and not leave them to future generations.
“If you look at the Federal Reserve’s forecast, you will see that by the end of the year, there is an expectation that the unemployment rate will rise. And that, of course, was one of the challenges of the Seventies and Eighties that caused the Federal Reserve to pull back and not get inflation under control until it was too late,” she said. “My hope for my colleagues is they will see their way through to tackling that important issue.”
Chris Thompson, executive vice president with Country Club Bank and a son of Byron Thompson, “number nine in the series” as he put it, closed out the event. He echoed the earlier references to 13 in his comments, stating that if he were to write a story about the Thompson family, the title would be “Lucky 13.” Chris noted that his parents were “made of sturdier” stuff and were not going to compromise or “go along to get along.” He said he felt like the people in the room were steeped in that same tradition.
“The pillars of faith that created a wonderful place like Benedictine College, created all of us, created Byron and Jeanie, gave them that strength that they said I can go forth and get this done our way,” he told those gathered. “We are honored beyond measure by your friendship, your kinship, and your example of life, faithful life, living it every day when it’s not easy, when it’s hard, especially.”
Founded in 1858, Benedictine College is a Catholic, Benedictine, residential, liberal arts college located on the bluffs above the Missouri River in Atchison, Kansas. The school is honored to have been named one of America’s Best Colleges by U.S. News & World Report, the best private college in Kansas by The Wall Street Journal, and one of the top Catholic colleges in the nation by First Things magazine and the Newman Guide. It prides itself on outstanding academics, extraordinary faith life, strong athletic programs, and an exceptional sense of community and belonging. It has a mission to educate men and women within a community of faith and scholarship.