Wednesday, December 26, 2007
Capitalism is about free trade and association between free individuals. Obviously, if one party is enslaved, there is no free trade between the two. Slavery is the worst form of thievery. Condoning, legitimizing, compensating individuals for immoral behavior is never a wise thing to do. What Mr. Paul proposed goes even further, since the funds for compensating the slave owners would have come from those who chose not to engage in slave trade. The moral would be compensating the immoral. What kind of precedent would that set?
Suppose you saw a man brutally beating an elderly woman on the street. Would you physically stop him or negotiate what the beater felt was a fair price to stop? Do you think the payoff would result in the beater being more or less likely to engage in reprehensible behavior in the future? If your child got caught shoplifting, would you raise his or her allowance if they promised to stop?
Don't you think many a newly enriched slave owner would immediately look for another distasteful, but not yet illegal activity to engage in? What about the people who chose not be slave owners and were required to pony up compensation for those who were? Doing the right thing because it was the right thing would have been institutionalized as a money losing proposition.
600,000 lives were lost during the Civil War. The loss of even one life is a terrible tragedy for those who knew and loved the individual. These lives were lost because some felt perpetuating the slave trade was worth dying for, while others felt stopping it was equally worth dying for. In regards to the question of whether it is right for one human being to own another one, there can be no comprimise. The two diametrically opposed positions cannot occupy the same place at the same time. If the slavery proponents were set on taking their position to their deaths, so be it. Fortunately, their opponents were just as resolved.
There are those who believe that there exist ideas and ideals that are more valuable than their own life. There are others who believe that continuing to draw breath is all that really matters. The former are in the minority, but the latter are far less consequential.
Sunday, December 23, 2007
You'll hear a variety of excuses for this - "We can't get a patent. We need more funding. It's almost ready!"
Here's the challenge:
If you have developed a system that produces more energy than the user must contribute to it, put something on the market. It doesn't have to be revolutionary. Create a lamp that one never has to plug in or replace a battery for. You don't even have to go mass market. Make a couple and sell them on Ebay. Forget the patent. If you're the first to market with such a thing, you'll make a fortune on the interview circuit alone.
The lack of funding or patent arguments are pure bunk. The recognition for being the one to bring a revolutionary discovery to the public arena would make you rich in and of itself. If you have no product, you have nothing. If you think you have something, do the Google thing: Give it away and capitalize on the gooodwill. If you don't someone else will.
Good, luck! I'm not holding my breath.
Thursday, December 20, 2007
Now some are on the verge of creating new DNA from scratch. What are the implications of the created becoming creators? One may be the eventual death of the mining industry. Microbes are the most efficient chemical factories on Earth. We are only just beginning to recognize the potential of letting living organisms do the work that is now being done by humans and machines. With taylor made living chemical factories it may become possible to produce any chemical imaginable from sludge, garbage, exhaust and other inexhaustable resources. This may even one day extend to heavy metals.
Of course there's also the danger that some whack job will use the technology to create something sinister, like a killer virus or an organism that reduces plastics or metals to piles of goo. Once knowledge is in the public arena, you can't take it back. Such is life. The trade off in progress is perhaps less security.
This leads to another possible downside. Safety and security concerns have already reduced grade school chemistry to mixing baking soda with vinegar and watching it fizz. Youngsters used to get excited about things like chemistry and electricity while playing with their home kits. Now, many of those types of educational playthings are not available. Could we see a day when even the most basic of educational resources are banned from public consumption due to safety and security concerns? I hope not. Keeping us safe by keeping us ignorant is not a road I'd like to go down.
In my humble opinion, the benefits of knowledge out weigh the dangers. So, pass the apples and boot me out of the garden.
Saturday, December 15, 2007
Granted there are corporations and executives that give capitalism a bad name, and those who go along with the "business/government partnership" game should be taken out and shot. But generally speaking, you've got to be completely oblivious to reality to think the government can do a better job at almost anything than a corporation or private sector enterprise.
To put the matter in perspective, just think about this hypothetical:
You have a problem that needs to be solved quickly and efficiently. You have two boards of directors to choose from who will be responsible for solving it for you.
Board 1 consists of George Bush, Al Gore, Hillary Clinton, Rudy Giulliani, Nancy Pelosi, Mike Huckaby and Mitt Romney.
Board 2 consists of Steve Jobs, Richard Branson, Muriel Siebert, Mary Kay Ash, Jack Welsh and Scott McNeally.
Assuming you know who these people are, the choice is a no brainer. Board 1 will ponder how everyone will feel about any decision they make and how it will effect them in the polls. Board 2 will come up with real executable solutions.
Capitalism is about creating value.
Politics is about creating emotion.
Corporations run on capitalism.
Governments run on politics.
Government should be used only when absolutely necessary.
Always avoid mixing the two. Like mixing vinegar with ice cream, it doesn't make either one better, it ruins both.
Tuesday, December 11, 2007
The Bush administration has set a goal for returning a man to the moon by 2020. Estimated cost to the taxpayer - $100,000,000,000.
Gerald Kulcinski, a professor who leads the Fusion Technology Institute at the University of Wisconsin at Madison and Apollo 17 astronaut Harrison Hagan "Jack" Schmitt, also have a goal of getting to the moon by 2020, to mine it for Helium 3. They want to form a company to accomplish the task. Cost to taxpayer of private sector venture - $0.00.
Fusion is the holy grail of the energy industry. It's the process that fuels the sun. Unlike fission, fusion is when molecules are forced together, releasing tremendous amounts of energy. Hydrogen has been the fuel of choice to this point, but it has some major drawbacks. The chief obstacle is that it releases a lot of nuetron radiation, which degrades the reactor. Helium 3 can produce similar amounts of energy without all those nuetrons. The Earth has very little Helium 3. The moon has plenty. Helium 3 is deposited on the moon via the solar wind. The solar wind is diverted around the Earth by its atmosphere "No Helium 3 For You!". It's estimated that Helium 3 could yield around $4 billion/ton. Enough to fuel a new lunar "gold rush".
This new incentive for private sector ventures into space will bring up some very important issues. How does one establish ownership of land in space? If you were to go to the moon, declare it a country, and set up a government, who would have to approve it? Who would nix it?
One thing's for sure. We'll be better off if the private sector wins this race. To all you "richer than God" entrepreneurs out there, before you consider another remake of the Taj Mahal on your back 40, think about investing in the new West. (I'm looking at you Ellison.)
The market is smarter than any committee, I don't care how many elites are on it. The best way to destroy innovation in any industry is to give government control over it. When's the last time you got excited about a blockbuster new product from the post office?
Cash is a product, like any other. It's an "avatar" for wealth. A tool for facilitating wealth and asset transfer. A substitute for direct barter. Banks "sell" cash to customers, who pay them back with more cash (loan plus interest). The banks get their inventory (cash) from customers who deposit money with them. Banks are not allowed to lend out all of their inventory. They have to keep a certain percentage on hand to cover withdrawal requests. When the bank's inventory of cash falls below required levels, the bank borrows money from the Federal Reserve overnight to cover the shortfall.
When banks are faced with increasing slow pays and defaults, the amount they must borrow overnight increases. This causes costs to go up, which are passed on to consumers down the line. This is why the Fed's overnight lending rate is so closely watched and why it can be a useful tool in affecting spending behavior, at least short term. When the Fed lowers the rate, banks can afford to cover more shortfalls for longer periods of time and aren't under as much pressure to raise their lending rates or take aggressive collection action.
When the Fed raises overnight rates, banks will often raise their own rates and/or tighten credit requirements to ensure a higher percentage of on-time payments.
Sunday, December 9, 2007
From Wikipedia: Prior to his work founding and serving as CEO of various companies, Peizer got his start on Wall Street. In his early career he held senior executive positions with the investment banking firms Goldman Sachs, First Boston, and Drexel Burnham Lambert.
In 2006 Peizer announced that Hythiam would be working with The Farley Foundation, founded by members of the comedian Chris Farley’s family, whose mission is to help spread the word about the need for addiction treatment. The Farley Foundation agreed to let Hythiam use the late comedian’s image in a now well-publicized awareness campaign. Tom Farley, the late comedian’s brother, joined Peizer in educating the press and public about addiction as a biological disease that needed to be addressed with medical solutions as well as behavioral ones. While the campaign generated a lot of attention, it was also criticized for its use of the late Farley's image.
This is an interesting case study for free market testing of a product versus a government pre-approval process. There are skeptics who say that Peizer is just trying to capitalize on desperate addicts and that his claims are overblown. While there are cases of people for whom the treatment didn't work, there are also many patients who claim the treatment saved their lives. I guess the question you've got to ask here is, even if the treatment turns out not to be effective, is it any worse than spending a month continuing to devour meth or coke or booze? In this case, I think market testing of a treatment is a great way to go. If it fails, no real harm done. If it succeeds, Peizer is a hero.
Wednesday, November 28, 2007
Given all of the factors listed above, the economy is growing at around 4%, unemployment is around 5%, mortgage rates are historically low, the stock market is still near an all time high, the surge is working and consumers say they're not confident while they continue to spend. If this is a low point in the current economic cycle, it's got to be among the highest of low points in recorded history.
Fortunately, the United States is still a relatively free market. Free markets make adjustments on the fly. The mortgage market will correct, real estate will come back, energy (oil or no oil) will be had. Troop levels will decrease and consumer confidence has become irrelevant as it is more a reaction to what people see on the news than a prediction of what they'll do.
Let's take them one at a time. Mortgage companies don't make money by not selling product. They got sloppy and they're now paying the price. CEO's who don't recognize and correct problems in their business model soon become former CEO's. The model will be fixed because there is no alternative.
Real estate prices are coming down. It's a buyers market. Prices are coming down because fewer people are qualifying for loans. Demand is still there. Houses for sale will be converted to houses for rent. Consumers will adjust to higher standards for borrowing and prepare accordingly. Builders will incorporated new materials and techniques to make homes more affordable.
New technologies in energy are becoming more and more competitive with oil. Back in the 70's there was optimism for alternative fuels, but it never panned out. Oil got cheap again and many alternatives were shelved by investors. The focus is different this time around. First, many of the technologies show the potential to compete on price with fossil fuels in the very near future if not already. Second, the emphasis this time is not on curbing energy use, but on using different energy. Lower emissions is a strong motivator as is national security. Jay Leno also recently disclosed another motivation. He outfitted his very large garage with a wind generator and expressed satisfaction with being able to use "home-made" energy. Just as home-made pie tastes better somehow, home-made energy just feels better than energy taken from the grid.
The stock market has been all over the board recently, but is still within 10% of an all time high. The worries are short-term. The long term view is for good times ahead.
The situation in Iraq has improved dramatically. The strategy of securing neighborhoods rather than chasing bad guys is working. The politicians still need to come around, but the movement is working from the ground up. Troop levels will come down over the next year which will bring down federal expenditures, increase demand for housing and generally boost consumer morale.
Consumer confidence has been waning for several months. This has not translated in any significant slow down in consumer activity. It seems people are answering surveys based on their perception of reports on the news and not based on their own reality. Bad news sells, so it will always top the headlines. Reporters always look for the "what if?" that would lead to the worst scenario. I remember asking a friend who commented once about the "runaway crime wave" in the country, "When was the last time you actually had to dodge a bullet?". The situation in his mind was not borne out in reality.
We have a unique situation right now in that several sectors and situations affecting the economy are poised for significant improvement at the same time. There is a convergence of technological and economic advancement going on around the world as information exchange continues to grow. Changes and adjustments take place faster than ever before. Betting on failure takes no imagination. Hunkering down is not a growth strategy. Be prepared for the opportunities ahead rather than bracing for the pitfalls.
Saturday, November 24, 2007
The rule of law is essential to the free market. Capitalism is the ability to enter into voluntary transactions and associations in the absence of force. It is a legitimate function of government to enable this environment. In the case of forced labor, the transaction is not voluntary or free from coercision. The beneficiary of the labor is a thief. Knowingly entering into a series of transactions that involves the use of force makes one an accessory and equally guilty of theft. It is not in the capitalist's interest, no matter what country they reside in, to tolerate theft. A policy that prohibited trade that involves individuals forced to engage in involuntary transactions is appropriate.
In the case of tainted goods, any party to the transaction that knowingly sells a defective or tainted product should be held accountable both criminally and civilly. The issue here is truth in advertising. One can't voluntarily enter a transaction if one party is giving the other false or materially incomplete information without their knowledge. Deception is aggression and can also, not be tolerated. We tend to treat Fraud as a "white-collar" crime and less serious than more physical crimes. Fraud is, in fact, an act of violence and just as harmful to a free society as physical violence. This is another principal that should be borderless in the minds of capitalists.
A code of behavior that is not necessarily embodied in the laws of government is called ethics. The ethics of capitalism should be clearly spelled out, promoted and defined by capitalists (before someone else defines them). The absence of self-regulation brings government regulation. It is in the capitalist's best interest to expose and confront unethical behavior and hold the responsible party(s) accountable. Communication is vital. The institutionalization of the essential fundamentals of capitalism cannot take place if the masses don't know what those fundamentals are. Freedom, honesty and accountability are among the core principals that should be portrayed as inseparable from capitalism and free markets.
Wednesday, November 21, 2007
I recently saw a video taken from a camera phone, of George Clooney stopping and confronting a photographer who had run a red light and swerved out of his lane to get a picture.
It occurs to me that there are at least two good approaches to this situation. One is to turn the cameras around. Today's technology enables cameras to be installed just about anywhere. When you go out in public, record it from your perspective. Get them on film when their behavior is outrageous. You could probably hire someone for around 80K a year to handle the whole thing for you. The other is to have a personal videographer. Establish your own archive of images and videos of you, by your employees. They of course have a big advantage over the competition because they'd know exactly where you were going, why, and when you'd be there. They'd get better pictures and reduce the value of the competition's shots.
Transparency is a good thing. The knowledge that your behavior is being observed presents a challenge to behave in manner you wont regret. But to put the observations in context, the information should flow both ways. I wouldn't regret punching a guy in the nose for sticking a camera lens in my face, but a third party would interpret my behavior differently if all they saw was the punch in the nose.
Celebrities could take advantage of the current imbalance in the recording of events surrounding them by collecting, editing and selling their own imagery from their own perspective.
Use the market (you know that evil capitalist thing) to your advantage. I'd much rather watch the lengths some loser will go to in order to get a picture of somebody eating lunch than watch the person eating lunch.
Saturday, November 17, 2007
New Zealand has a universal health care system. From Wikipedia: "In New Zealand hospitals are public and treat citizens or permanent residents free of charge and are managed by District Health Boards. Under the current Labour coalition governments, 1999 - present, there are plans to make primary health care available free of charge. At present government subsidies exist in health care. This system is funded by taxes. The New Zealand government agency PHARMAC subsides certain pharmaceuticals depending upon their category. Co-payments exist however these are ignored if the user has a community health services card or high user health card. " As I've previously pointed out, this opens the door to all kinds of restrictions on behavior and lifestyle in that society now has a vested interest in your real and potential need for health care.
In this case a couple wishing to immigrate to the country were denied visas because both exceeded the country's Body Mass Index limits. The husband was able to lose the weight necessary to comply. The wife was not. The husband left his wife in England for the time being, but that's a whole other story.
The relevant point here is that since the government is the provider, the government can set the conditions as to who will get resources and when. This woman is a victim of her own metabolism (and the fact that the biggest factor in fat creation and storage is actually the carbohydrates that make up the base of the food pyramid we're all encouraged to use.) She is now, no doubt, frantically seeking weight loss programs and paying through the nose for them, so that she can not be such a burden on the health care system of the country she wishes to live in. Of course, if she's successful, she'll be taxed to help pay for the system she's being encouraged not to have to use.
Regulating your weight is only the beginning. Universal health care makes restrictions on things like recreational activity, diet, mode of transportation, almost any activity you can imagine, justifyable. Anything that carries any potential risk of illness or injury represents a potential "burden" to society.
Take note and be careful what you wish for.
Friday, November 2, 2007
In Star Trek we have a society that no longer uses currency. The only way to advance yourself is through promotion, which comes from the central authority. Even Kirk, portrayed as something of a rebel, ultimately answered to Star Fleet. The whole premise of the Stargate series is a community of space faring earthlings, funded entirely by the government and unknown to the citizens whos taxes pay for the program. Knowledge and new discovery are deemed too dangerous for the general population to deal with. Battlestar Gallactica features the last surviving humans fleeing for their lives from the Cylons. They are totally dependent on the military and government structure. There are something like 40,000 remaining humans, yet a great deal of them belong to the one remaining thriving industry: the press core. In a population the size of a small town, dozens of reporters crowd the room whenever someone in authority has something to say. After all, the two most important groups in the human race are government and the media right? Never mind that neither group actually produces anything.
Where are the capitalists in these programs and movies? Oh, they occassionally appear, but only as shiftless, greedy, dishonest types. They are either direct adversaries of our heroes or quirky, minor characters who are tolerated by the rest, and used mainly for comic relief. Most often they are arms traders, black marketeers, slave traders or some other criminal element. The Firefly series did buck the trend and featured a group of non-government individuals trying to eek out a living amidst an oppressive central authority. The episodes were aired out of sequence and it was cancelled before the end of the first season.
This is Hollywood's vision of the future. A vision based on the belief that someday, we will dispense with the notion of the supremacy of the individual over the mob and embrace instead a primary focus on the good of the state, society, humanity. A vision that builds a society in which a very few benefit greatly from the labor of the masses, and the masses are grateful for the opportunity. This is not surprising coming from a demographic that travels by private jet to meet, greet and eat around the world in $4,000 suits with massive enterourages while telling the rest of us to cut down on consumption for the good of the planet.
So why does an industry that makes all of its money from the free market constantly portray a Utopian future in which the free market doesn't exist? Do they feel guilty about their riches and therefore work to bring about the destruction of the system that created them? Or are they just stupid? I'm not sure. I am sure that the conquering of deep space will never happen under a socialist system. Even a "kinder, gentler" dictatorship is self destructive. You can't order people to be creative. You can't take away individual rights and then expect people to excel. The Soviet Union was able to create a massive war machine through tyranny for a while. But as we found out after its fall, they weren't able to maintain what they built. The fall of many a "great" civilization has come about largely due to the population's lack of interest in passionately defending it.
It's said that life often imitates art. If that's the case, American art needs an overhaul. Do you want an exciting future for your species or for your grandchildren? Are we insignificant parts of a greater whole or are we great people? Don't just watch, think. What's the message? Where are the producers leading our imaginations? What's the end game? Is it time for a rewrite?
Thursday, November 1, 2007
Is oil getting scarce? Maybe. Will it get ridiculously expensive? Maybe. Are we so oil dependent that we can't operate without it? Absolutely not. Exxon's margins on gasoline actually dropped in recent quarters. That's because there is a limit to how much people will spend on gas. When it topped $3, we drove less. We left the SUV's at home. Sales declined. The price came down even as oil continued up.
Crude's still got some room to rise. It's still the fuel of choice due to it's relatively low price (even at $100/barrel) and its widespread availability. But at $4/gallon for gas, other options become commercially viable. You can already get wholesale biofuels for about $2.25/gallon. Hydrogen on demand vehicles are very doable. As are flexfuels, TDP, methane, ethanol and a host of others, not to mention the newly discovered method of releasing hydrogen from salt water using radio frequencies.
The only reason these alternatives aren't more widely used now is that they aren't yet competitive in the marketplace. It will take more than a short term spike to take oil out of the game. But once the price gets too high for a protracted period of time, investors will take the plunge and go full speed ahead with other options. The other thing working against oil is that technology is bringing the price of many of these alternatives down. Solar Ink may bring the cost of solar down by a factor of 10 within 12-24 months. What do you think that will do to the solar market?
Oil is reaching a peak. The peak of its usefulness as a fuel source. Only one thing will bring the fall of the global economy: bad government policy. Free markets enable rapid adaptation and resource allocation.
Is there manipulation in the oil market? Probably. But eventually, some group of chumps will be left holding the bag when the crude bubble bursts.
Saturday, October 6, 2007
Election season is in full swing. As the parties debate the war in Iraq, terrorism, health care, education spending, etc., there is a certain constituency left out of the political pandering game. How do the parties rate in the eyes of a free market capitalist who believes in individual freedom, a strong defense, and the absolute separation of church and state?
The Republicans used to at least give lip service to these issues, but have increasingly bonded with religious lobbies, embraced a much more tolerant attitude toward "socialism light", and gone along with increasing regulation while doling out subsidies for their favored associates and industries.
The Democrats have gone farther left than they've ever been. They promote higher taxes and ever increasing socialist agendas, as evidenced by the recently vetoed bill that would have redefined "struggling" families as those earning up to $80,000/year for the purposes of qualifying for government subsidized health care. They have open disdain for the free market and believe in personal freedom only so long as you behave and speak in the party endorsed manner.
The Libertarians are so almost there, but their belief that a strong national defense is something we should do away with is a deal breaker. I'd sooner vote for a socialist and deal with that for a few years. We can fix the damage later. If we abandon national defense there will be nothing left to fix.
So where's a capitalist to turn? Well, the good thing about political parties is that they are more infrastructures than philosophies. Although at any given time they may attempt to promote a specific agenda, that agenda can change over time. Their main purpose is to win elections through the marketing and promotion of candidates under their banner.
One important thing capitalists often overlook when dealing with the rising political influence of socialists in all parties is that they are funding all of it. Socialists don't produce wealth, they only consume and redistribute it. Therefore, their only source of assets is from capitalists, producers, people who add value. Every dime used to promote the socialist agenda comes directly or indirectly from the marketplace they're attempting to stifle. You're providing the fuel. You hold the purse strings. Don't ask for change, demand it. While you may decide to vote for the lesser of evils, you may also decide not to vote at all, and you certainly should never provide cash for a candidate or party that's ignoring your concerns. There are subsidies going to people for no other reason than the own the right piece of land. $20,000/year jobs are being preserved at a cost of hundreds of thousands of dollars per job per year. The postal service continues to increase the markets in which it competes while outlawing competition against itself for the first class mail that keeps getting more expensive with no corresponding increase in value to the consumer. We tolerate dictatorship and nationalization of resources around the world in the name of stability, and there's a non-stop movement toward the nanny state in this country.
Stop funding it. Stop supporting it. Stop tolerating it. Stop endorsing it. Stop voting for it. The parties are going continue to advance bad ideas and ask for your vote because their bad ideas aren't quite as bad as the other guys. You don't have to participate. Let them wallow in the mess they make until they figure out where value really comes from.
Conventional wisdom says increased voter participation is the answer. But if the choices are between being pushed off a cliff or thrown out a window, does it really matter how many votes are cast?
Saturday, September 29, 2007
Celebrity politicians seem to prefer hyperbole, over-simplification, mockery and reliance on well studied guidelines from the group and its hierarchy. Why do you suppose that is? Why is it that the more under the microscope a politician is, the more likely you'll never hear them engaged in a substantial, open conversation?
It may have evolved as a form of professional courtesy. If you aren't confident in your assessment of an important issue, but you want people to think you are, you'll do whatever you need to do to keep the conversation from getting too in-depth, especially on national television. Now with the advent of video phones and YouTube, you would have to be on gaurd 24/7. You might have serious discussions in private, where nobody can hear you be wrong, but you'd avoid it like the plague in public.
Perhaps the mindless bantering back and forth is a convenient means for both parties to a public conversation to avoid exposing their own ignorance or weakness on a subject. Have you ever seen a nationally prominent politician turn to another one from another party and say "Gee Bob, I never thought of it that way. You're absolutely right. I was mistaken." I've never seen it in my lifetime. In the history of modern telecommunication, doesn't it seem odd that there's not a single recorded instance of a nationally known politician having his or her mind changed. Can all these people who are supposed to be professional influencers be so inept at the art of reason that in 50 years, nobody's ever made a point well enough to change a mind on television or even camera phone?
More likely, it's an "industry standard". It's just become accepted that you don't have productive conversation in public. Some might suggest they're just talking down to the level of the general public. I believe many more people would tune in and pay attention if the conversation were more intelligent. But intelligent conversation is risky. Especially if your method of reasoning really isn't on solid ground. If you look or sound foolish, your career could be in jeopardy. Safer to keep the conversation on an emotional level.
Saturday, September 15, 2007
By Captain Capitalist
The other day, as I was engaged in a forum on the web, as I'm prone to do, someone had referred to the business community as "elites". My knee jerk reaction was to get defensive. But, after thinking about it a bit, I realized he was right. They really are elites. Who are these elites? Where do they come from? What makes them elite? Let me give you my take.
When most people think of the business community, they think of large corporations and familiar brand names. The fact is that 90% of US businesses have fewer than 20 employees and in a recent study by the Small Business Administration were determined to have created a whopping 97% of all new jobs. Most communities and municipalities spend a great deal of time trying to woo large corporations and box stores because they can sport large individual numbers as far as sales taxes and employees. Never mind the fact that the vast majority of the tax paying public works for small businesses. When government does offer a bit of assistance or a bit less resistance to small businesses, they often act as though they are performing an act of charity. Ironic, since it's the small business that's providing the foundation for the economy and their salaries. I've no grudge against big business. I hope to own one some day. But you can't be a fan of apples and hate apple seeds.
Here in the most successful capitalist country the planet's ever seen, we don't emphasize the knowledge and skill sets it takes to run one's own business in our public schools. Instead we emphasize what it takes to be a good employee. We're encouraged to focus on a single skill set so that we can be a valuable asset to someone else. There's nothing wrong with being a good employee, but one would think in the land of the American Dream, some instruction on how to achieve it might be appropriate.
This is not the most inviting atmosphere for someone to risk everything in pursuit of what they think is a good idea. Yet, a hearty few do it anyway. When they do they're faced with a myriad of permits, forms, zoning regulations, parking requirements, approval hearings, "use" taxes (for those of you who aren't familiar with the concept of "use" taxes, if you take a shelf out of your home and put goods for retail sale on it, it's now subject to tax every year, really.), among other things. Most of those who venture into this arena are not wealthy. They're people just like you and me who want to find another way to make a living and follow their dream. If you calculate the hours worked versus the return, many spend years working at or below minimum wage. Many don't make it and actually do lose everything. Many of those, dust themselves off, get up and do it again.
Owning your own business means there's nobody to pass the buck to. Whether you have all the answers or not, you're the one that has to supply them and take accountability for them. There are times when you'll want to curl up in the fetal position, pull the blanket over your head and wish the world would go away. But it wont, so you shake it off and get back in the ring. If you fail, you're a fool in the eyes of many. If you succeed, you're a greedy exploiter and will be faced with more and more demands that you "give back" to the community, as if creating a successful business somehow "takes away" from the community. I have nothing against charity, but if you want a donation, ask for it. Don't imply that I took something from you.
This is not the path for the meek. Business is for those who love the game. It's for people who aren't afraid to lose, but will do everything in their power to avoid it. Even those who achieve great success keep at it even though they really don't need to. Do you think Steve Jobs goes to work every day because he's sweating his mortgage payment? It doesn't take super-intelligence. It takes a strong will, determination, confidence, the ability to think on one's feet and adjust rapidly to changing conditions and it takes a lot of guts. It takes...the elite.
Long live the elite.
Sunday, July 22, 2007
Ask a well-schooled pundit what the Jihad or the War on Terror or whatever we're calling it this week, is about and you're likely to get an earful of religious history, territorial disputes and Western "meddling" in mid-east affairs. There's a grain of truth in that but when you drill right down to the core issues, it's a lot simpler than that. The primary issues at stake are Private Property, Women's Rights, and Rule of Law.
Nomadic tribal lifestyles and modern economies don't mesh well. You can't roam free across private property. As cities and towns bring efficiencies and infrastructure, they also bring restrictions on movement, behavior and access. To the nomad, every new or expanding structured settlement represents a threat to their very way of life. In the long run, this is a battle they cannot win. For while they rail against city life, they can't help but to patronize the producers who create it. The cars, the clothes, the computers, the medicine, the Internet, the cell phones, even the weapons are profit generators for those they're fighting against.
Perhaps the biggest bone of contention is the notion of equal rights for women. In many middle-eastern communities women have no more rights than a piece of furniture. They exist to serve their men. That's all. The capitalist pigs of the West have dispensed with that notion. Why? Because a good capitalist knows that keeping good talent down is bad for business. Equal rights isn't just a moral issue. It's a the intelligent way to maximize market penetration and recruit the best help. There's no middle ground on this one.
In many ways the war lords of the Jihad have more in common with the Mob than with any religious heroes. They rule by force, fear and intimidation. The establishment of the rule of law, imposed equally and objectively across social, economic and ethnic classes, throws a monkey wrench into their operating model. Gangsters thrive among chaos and lawlessness and will create it when things get too orderly.
The leaders and perpetuaters of Jihad will never come out and say they are fighting to prevent private property, women's rights and the rule of law. Instead they have embedded the opposition in their religion. It's presented as an all-or-none package deal. You go along or you go to hell, and if they speed your arrival, they're doing something holy and just. The promise of heaven and the threat of hell are powerful motivators. Convincing people to stop thinking and take things on faith is not nearly as hard as one might imagine, especially when the payoff is eternal bliss. As many dictators and monsters throughout history have demonstrated, once you get people to turn their brains off, anything is possible.
Sunday, June 24, 2007
Both proponents and opponents of intelligent design have made some serious mis-steps in logic. Intelligent design is the idea that the universe was created by a sentient being. I have not ruled out that possibility. But many have attached to the idea a whole range of assumptions that have no basis in logic.
If we start with the premise that the universe as we know it, was created by a sentient being or beings, it does not logically follow that said being(s) are immortal, all knowing, all wise, benevolent or in any way superior to humans other than in the accumulated knowledge and technology needed to create what they created.
The advancement of human technology didn't take off until we learned to record and share information, with each other and with future generations. We've only been doing so on a grand scale for a number of decades. Imagine a group of sentients who have been around for billions of years. They may have accumulated a huge mass of knowledge and technology. One doesn't have to be supernatural or super-intelligent to make use of and build on the discoveries of previous generations. Individuals within such a society could be relative dolts compared to humans and still be capable of things that seem magical to us.
Human beings will soon be able to essentially transfer our consciousness to remote locations across the solar system and beyond, by using probes outfitted for audio, video and eventually even odor, touch and taste and we don't even know what consciousness really is yet! We can genetically alter living things and will likely soon be able to create new life forms. Note that I'm using the term "we" when in fact these things are accomplished by multiple individuals across many generations. Steve Jobs did not waive his arms and say "Let there be iphone", and he is not supernatural. Humans have only been at the creation game for a millisecond or so in cosmic terms and have already accomplished some amazing things. It demostrates the power of parallel processing. There is no reason to believe the same dynamic didn't take place with respect to the universe.
Fractal geometry demostrates that one can create a relatively simple mathematical program, press start, and get an increasingly complex and boundless result that continues to change and grow over time with no additional input from "the creater". There is no reason to believe that an intelligent designer(s) had any idea how all the details of the universe would work themselves out, evolve and grow.
We are in the process of reverse engineering creation. If we don't blow ourselves up first, we will eventually crack the code of the universe. I think we'd do better and progress faster if we were to lose the mindset that things we don't yet understand and can't explain must therefore be supernatural or magical. If the human race is to survive for billions and billions of years we will have to weather cosmic catastophes like comet or planet collissions, the death of the sun and more. Cracking the code is not optional in terms of our survivability. It's imperative. Step one is to realize that it can be done. Step two, if you are going to go with the premise of intelligent design, don't assume that the designer(s) have your or our best interests at the top of their agenda. That doesn't mean we all can't get along, but we don't subjegate ourselves to those who may have come before us. If they exist, seek peer to peer relations. In fact, I think that would be mighty generous of us, given that any surviving creaters have evidently chosen to remain incommunicado to this point. Not very diplomatic of them.
Saturday, June 23, 2007
Is global warming for real? Is it a short term trend or a major climate change? Is human activity responisible? I don't know. What I do know is that at some point the climate will change. It always does. What do we do about it? Be aware, and be prepared.
Climate change isn't something that happens overnight, but recent studies suggest that major shifts in the Earth's climate in the past (way before SUV's) have taken place over a period of decades rather than centuries. It can be devastating to individuals and economies. But in each instance of climate change over the past million years or so, hearty humans all over the globe made it through, because they found a way to adapt.
We have the benefit of accumulated knowledge, experience and technology. That puts us in a better position to deal with climate change than humans have been in any point in our history. Yet, we spend most of our time trying to figure out how to make it stop or who to blame and very little time thinking about what we're going to do when, not if, the climate becomes substantially different.
Companies and households have been encouraged to make contingency plans in case of fire, flood, severe weather, why not climate change? It's not something one has to spend hours a week on, but as a company, a meeting once a year to discuss what if's in the event the weather gets a lot warmer, or colder, or wetter or drier might be time welll spent. As a homeowner, one might at least spend a little time thinking about what modifications one could make in the event of climate change, and maybe put a little money away for it. As an entrepreneur, think about what products and services might be in demand should the average annual temperture or rainfall shift. Look to other areas of the world for answers. How do people in the middle east deal with 130 degree days? How do people in the Arctic deal with 35 below zero? Instead of just thinking, "How can I put a stop to this?", spend some time thinking "How do I take advantage of this?".
I'm not suggesting that we ignore the impact of human activity on the environment or the weather. I am stating the obvious fact that the climate has always changed and will do so again. It may do so in your lifetime. When it does being prepared to adapt and look for opportunities might be a better use of time and resources than figuring out who to hang in the town square or shaking your fist in the air and demanding someone do something about the cycles of the sun. Part of "being in tune with the planet" is the ability to adjust to its changing temperment. Climate change is going to happen, no matter what kind of car you drive or how many waterless toilets you install. Deal with it.
Sunday, June 17, 2007
The Senate and the White House are desparately trying to revive an immigration reform bill that can be passed this year. On one side of the debate are people who believe the other side is anti-immigrant or anti-hispanic, while the other side sees their opponents as being anti-border control and pro-amnesty. The public at large, meanwhile, sees a total lack of credibility on the part of our elected representatives. I believe the public has it right on this one.
Immigration reform is not new. We've passed reform bills before that granted a form of amnesty for those already here while promising tougher border enforcement. Enforcement never happened and we have no reason to believe that Washington is serious about making it happen this time. While proponents of the bill debate this amendment and that, most put dealing with illegals already here as priority number one, and treat border enforcement as kind of a side issue that they'll get to later. The illegals already here aren't going anywhere. We have plenty of time to figure out how to deal with them. If we don't get control of the border, whatever else we do is absolutely meaningless.
If we need more immigration, let's make legal immigration easier and allow more people in. Allowing throngs to sneak across the border, then granting them amnesty is not an immigration policy, it's just negligence. The suggestion that our economy will fall apart if we get control of the border is fiction. Life as we know it will not come to an end if we have to pay 95 cents/lb for tomatoes rather than 90 cents. If our economy is dependent on employers being able to hire help at below market rates, the economy needs to adjust. There is no shortage of workers, just a shortage of workers willing to accept the wages employers would like to pay. If higher wages push the price of your product up to the point that demand drops off, then your product obviously wasn't as critical to our existance as advertised. No the answer is NOT to subsidize the tomato industry. Let supply and demand do it's thing. We'll deal with it.
If we are able to secure the border in a a meaningful way, I'll get 100% behind some kind of amnesty program. I don't believe a $5,000 fine, as has been proposed by some, is unreasonable. There are low income people who pay more than that for wide screen TV's and game systems. We could even work out an installment payment plan. But borders security needs to come first. I would like to see two separate bills. Border enforcement first, then, after the promises have been kept and measureable results demonstrated, a means of accomodating those who are currently here illegally.
The American people are not anti-immigration or anti-hispanic. They are anti-BS and are becoming increasingly aware that BS is the number one export of Washington DC.
Sunday, June 10, 2007
The debate about health care continues to rage. There are good ideas out there. Many are shot down instantly because the wrong political party proposed them. Here are a few points I'll put out there without mentioning which party or politician, if any, suggested them.
1. Individual health insurance. One proposal being talked about these days is to make health insurance more like car insurance. You would purchase your own. You wouldn't have to worry about transferring from one workplace to another. Your rate would fluctuate according to your risk level and the number and amount of claims. There could be provisions for a "high risk" pool, with rate limitations or a (dare I say it) government backed policy for those who can't qualify for strictly private sector plans.
2. Tax deductibility. Of course there are Health Savings Plans out there, but wouldn't it be a lot simpler to just make health care expenses (and individual health insurance premiums) tax deductible? What do you care if I pay for my health expenses from a pre-designated bank account or put it on my Visa? Again there could be government backed lending plans, similar to Fannie Mae or the Federal Student Loan Program, to accommodate those who don't have ready access to funds or credit.
3. Realistic goals. How do you prevent someone from being driven to bankruptcy by extraordinary health care costs. In some cases, you can't. Bankruptcy is a hassle. It's not the end of the world. In fact, capitalism wouldn't work without it. You have to have a mechanism for "do overs" when one's financial situation becomes untenable. Starting over can be and is done, every day. The important thing is to ensure that nobody is denied critical care due to lack of funds. Every industry deals with write-offs of noncollectable accounts. Health care is no exception. In many cases, bankruptcy situations can be avoided through access to affordable credit. In cases where it can't, the economy can and does deal with it 24/7.
4. Last and most importantly, focus on common goals and good ideas rather than on who's liable to get credit for them. This runs counter to current political thought processing. Let your elected officials know if you're tired of hearing about what wont work and you'd like to hear about some things that will.
Thursday, June 7, 2007
It's a commodity we've come to depend on for our very way of life. It's trade has brought about the rise and fall of cities, countries, entire regions of the world. Wars have been fought over it. Wars have been won and lost according to who had better access to it. It's been used as a currency, a status symbol and an international diplomatic bargaining tool. I'm talking about, of course, salt.
Yes the commodity we all take for granted today and even dump on our highways by the truckload every winter, was once very litterally, a king-maker. Salt was a highly sought after and fought over resource for at least 4,000 years. Timbuktu was once a world economic superpower because it was centered on salt trading routes. What happened? Technology and innovation has made it almost universally accessable and cheap.
Today's commodity market king of the hill is oil. We've come to depend on it for so much that it's easy to forget, we've only been economically addicted to the substance for 50 or 60 years. If the history of homo-sapiens were a day, that would be about 45 seconds. It's true that it has helped give rise to the largest, fastest rise in world economic development in history, but if you're counting on it reigning supreme over the long term, or even for more than another generation or two, you're in for a rude awakening.
Here's the reality of the current situation. We've been lead to believe that we're in the midst of a global energy crisis. The fact is that the world has enough total fossil fuel reserves, even by pessimistic estimates, to feed our energy jones for another century or so. There are a number of alternative fuel sources under development, which will be widely commercially available, competitive, and likely economicially superior choices, well before then. Fusion's a biggie, but probably 50 years off at the current rate of development. Other technologies like Thermal Depolymerization, Fuel Cells, Electolysis (which will produce hydrogen from water for both fuel cells and internal combustion), Hydrogen on Demand (from borax), Sterling Solar and Biodiesel, just to name a few, are almost ready for prime time now. When one crosses that threshhold of being cheaper, cleaner and at least equal in performance to gasoline, it won't take 25 years to deploy. The market wont leave it up to current government and industry leaders to figure out how to make it available. Entrepreneurs and risk takers, as always, will get the job done without their blessings.
So why the big paranoia over a commodity that will be largely obsolete long before anybody runs out of it? The many parties who benefit most from the oil market status quo have done a great job recently of controlling supply, regulating production, discouraging alternatives through selective subsidies and tax incentives and generally selling the idea that we can't live without it and that trying to do so would be economic suicide. This can slow, but wont stop market evolution. Change wont be gradual. I don't know when, but relatively soon, the oil market is going to fall hard. Here's what to look for preceding the event. Mechanisms will be created allowing average consumers to purchase oil and gas futures fairly easily. Brokers and trading houses will run constant commercials advising everyone to "get in now" before it's too late. The price of oil will go insanely high, then suddenly, the bottom will fall out. The same folks who bought into the Y2K scare and loaded up on any stock that had the word "intenet" attached to it just before the bubble burst will be left holding the bag.
So what do we do about energy prices today? Today we deal with the reality of today. But sleep well. The sky is not falling. Keep your eyes and ears open, your objective thinking cap on, and remember, so far everyone who's forcast the end of the world has been wrong.
Saturday, June 2, 2007
George Orwell's gloomy predictions in the book "1984" have turned out to be exactly backward. In Orwell's view, the advance of technology empowered authoritarian government (Big Brother) to keep tabs on individuals and control every aspect of their lives. The reality has been just the opposite.
First of all, for an economy to develop advanced technology, one must have free enterprise. That's where the money comes from. The Soviet Union lost the cold war because they couldn't afford to keep up. China is gradually moving toward free market capitalism because it pays well. They will never reach their full potential until their society is also free. If and when that happens, more power to them. The reason for that is simple: Resource allocation as determined by billions of individual decisions made every minute is a much more efficient system than resource allocation by a handful of self-anointed elites.
The advance of technology in the west has actually lead to scenario's like the recent rebirth of Radio Caracas Television. Venezuelan strongman and international idiot, Hugo Chavez (until recently lauded as a visionary by many dolts, I mean pundits), shut down the station because it did not promote views consistent with his agenda. The station is now broadcasting daily via YouTube. The authoritarian government shut them down and the private sector put them back up.
Many people are now up in arms about Google's new Street View technology. Google's satellites provide a panoramic view of streets and intersections. When you look up an address you can actually see exactly where the building is, and what it looks like. People fear this may lead to a "Big Brother" scenario where the government can keep tabs on you 24/7. A real "Big Brother" scenario would be if the government took control of Google's cameras and pulled them from the web so that you and I couldn't access them. What we speculate was a massacre (we have to speculate because there were no camera's) at Tienemin Square in 1989 didn't take place until after the government kicked out the media and shut down all the cameras.
Bad guys and bad governments are like cockroaches. They don't like the light. The technologies being deployed today are not part of a monolithic enterprise, working together to keep you down. They are individual pieces of technology being made available to the public by a wide variety of organizations with differing and sometimes conflicting agendas. They are competing for your business and when one steps out of line, the others are more than happy to point that out to you.
Information technology is an extension of memory, but it's much more reliable and accurate. The current boom in sharing, transferring and storing information is akin to the invention of the written word. Billions of individuals can now share and build on each others ideas, and carry the effort forward to future generations. It's much harder now for governments and con men to hide the truth from the masses, and good ideas have a better chance of being brought to fruition than ever before.
If you're concerned about individuals being able to see what you're doing in public, here's an idea: Stop cheating on your wife, lying to your business partner, running red lights, stealing from you boss or trying to dupe the public. Then go home and get a good night's sleep.
Big Brother, we're watching you.
Sunday, May 20, 2007
You may have heard of a very popular book/dvd/program out there called "The Secret". I haven't purchased it myself, but after talking with some who have, I think I've got the jist of it. Regardless, here's my interpretation of the concept. It's not that complicated, but it does take practice and conscious effort.
A good driving instructor will tell you that if you want to avoid an accident, don't focus on the thing you're trying not to hit. Your naturally tendency is to lock eyes on the obstacle, and often that is what leads to the collision. Instead, you want to look for the "out". Find the open area and focus on it.
You can use the same principal in setting and achieving goals, both in your personal and business life. Too many times we focus on problems, obstacles, reasons why something wont or can't work. If you're always thinking "What if this happens?" This is much more likely to happen. Try setting aside time each day to envision where you want to be in the future, whether it be next week, next month, or in 5 years. Imagine it in as much detail as you can and make up your mind that that is your destination.
Here's the tricky part: Keep that vision in your mind all the time. Always ask yourself, "Is this decision or action going to take me closer to, or farther from, my destination?" If you're always making spur of the moment decisions, you're likely spinning your wheels instead of moving forward. Forget the obstacles. Focus on the "out". Look for openings and opportunities instead of roadblocks and problems. With constant practice you'll find that more opportunities present themselves every day than you'll possibly have time to take advantage of. Pick and choose the ones that will most efficiently get you closer to your goal. When a problem or crisis does come up, you'll feel stress and anxiety. Normally this can send you into very unproductive panic or depression mode. You have to train yourself to react differently to panic and stress. Some of the best ideas come out of crisis and stress situations. It's your body's way of telling you you're facing a problem you don't currently have a solution for. Instead of reacting by thinking "Oh no, I'm hosed." think along the lines of "I'm about to come up with a great idea" and get excited about it.
Of course, before you can put any of this into practice you have to be ready, willing and able to take total responsibility for your own situation. If you're comfortable blaming mis-steps, failures and misfortune on other people, the government, society or fate and you don't want to let that go, it's not going to work for you. Bad things do happen to good people. Take some time to grieve, get mad, sob uncontrollably and get the emotion out. But limit yourself. If it's going to be long term, set aside an hour a day for being miserable, then get back on your horse. If there's a lesson to be learned, learn it. If not, let it go for the next 23 hours, get your bearings back and continue forward.
This doesn't mean that everything you do will be successful, but if you're going to go after something you have to assume it's going to work. Now if you've been beating a dead horse for awhile and it's still not getting up, you need to get a new horse. Adjust the vision, not the method.
With constant effort and focus on the positives all around you, rather than the negatives, you'll find your success rate increasing and generally enjoy each day more. It's not a big secret, just a good idea that you can share with everyone, while still retaining full value for yourself, and best of all - No Charge.
Saturday, April 28, 2007
By Captain Capitalist
Yes the nationalized health care craze is rearing it's ugly head again. This is not just another bad idea. If you're a fan of individual freedom and free market capitalism, this is a threat to your very way of life and that's no exaggeration.
Being compassionate people, most would like to see everyone have their basic needs taken care of. This is where the movement gets it's fuel. We don't like to see people suffer, so when somebody points to a suffering person and says "I can fix that" people take heed. But in this case the proposed cure is worse than the disease.
Part of the problem is that health care service providers and advocates have driven demand way beyond what was once considered "basic" need. Once you establish that health care is priority number one and everyone should have it, where do you draw the line? When life expectancy gets to be 150, people dying at 125 will be seen as a tragedy and people will be knocking at your door asking for donations to fund research to prevent it. When one disease or syndrome is cured, the next one in line takes it's place. There is no end, because what people are really trying to prevent is not a particular disease, but death itself.
In a free market there would be nothing wrong with this dynamic. We may get to virtual immortality if the free market is allowed to exist long enough (that's a big if). At first it will be affordable only by the wealthy, then the market matures and prices come down. It only becomes problematic when the government declares that everyone has a right to be as healthy and live as long as the latest technology can enable. It's akin to declaring that everyone has a right to free chocolate provided by the government, or free computer equipment. With no mechanism for stemming demand (i.e. price) working on the recipient, costs naturally skyrocket. Attempts to reign in costs simply stifle innovation and limit production. How many exciting blockbuster new drugs have come out of Canada or Europe in the past couple of decades. Roughly ZERO.
It's not hard to imagine taxes and spending going ballistic, driving what remains of our thriving economy underground. But let's assume I'm way off base about the cost and that we can afford to dole out free, quality heath care to everyone. There's still a big problem. Now that we've established that society is responsible for your health care, society has a legitimate claim on limiting your activities. If you're going to ask me to pay your health care costs, I'm going to insist that you don't smoke, eat too much, eat the wrong things, engage in "extreme" sports, drive a car more than 20 miles per hour, drink a drink over 85 degrees, use sharp objects without a license..... Are you starting to get the idea?
Here's the alternative: We recognize that being human on planet Earth means you're going to get hurt and sick from time to time and at some point you WILL die. Everyone dies. Everyone. Some people can afford cutting edge, top of the line health care. Some can't. In America, the poor and uninsured can get emergency care. It sometimes means the health care provider doesn't get paid, but it's that or let them die in the street. The only thing insurance changes is that instead of the shareholders taking the hit, you and I do. It doesn't create more money. It just shifts liability and risk away from the health care industry. It is not a crisis. Health care providers take into account the financial impact of no-pays and slow-pays when devising pricing. At least now, many low income people only seek care they know they can't afford when they are really in crisis. If you suddenly enable everyone to seek health care 24/7 guilt free, what do you think is going to happen? Picture your localMcDonald's having a Free Food day. Do you think that would result in lots of happy, well fed people? More likely traffic jams, anger, frustration, injury and mayhem.
Free health care may be inevitable if the mob can't be convinced that it's a horrible idea. But it will also be disastrous. If freedom and free market capitalism are to survive and thrive in America we can't sit this one out. This debate must be engaged head-on. The free lunch must be exposed for what it is. Remember, you can't have everything. Where would you put it? (Steven Wright)