Immigration Policy is Making US Insane

The parable goes like this:  If you offer a Russian anything they want, with the proviso that whatever they pick their neighbor will get twice as much, the Russian will say:  "Put one of my eyes out".  

According to this piece in the NY Times today, the parable should be revised to read:  "If you offer an American...".

The article argues convincingly that we underfund education because we want to ensure that children of immigrants are not the beneficiaries of our educational system.  We are committed enough to this idea that we are willing to sacrifice the education of our own children in order to accomplish it.  That is some extreme protectionism.

There is no question that immigration policy is a very complex issue with many variables.  Just read this paper by the UN's Social and Economic Affairs group on the relationship between policy reform and income distribution and you will gain a new appreciation for the complexity.  For a quicker reference, here is a link to the CIA World Factbook's list of income distribution showing that of the 134 nations on the list we are 45th from the end that is most polarized (Namibia) and a long way from the least polarized (Sweden).

I put in these two reference points because I still think of our country as the land of opportunity.  America is the place people want to go when they want to improve their lives through hard work -- not through a free ride.  We hear often these days that our current policy changes are socialist, and maybe they are, but we are a long way from the socialist end of the income distribution curve and our recent willingness to let the hand outs go to those that don't need them only pushes us more towards the rich get richer model.

We want our economy to grow.  In order to have growth we need immigration.  Highly skilled people want to move here (for now at least) -- so let them in.  Along the way some not so skilled people will get in too -- that is also going to work out for us in the end.

Here is a link to the posts in this blog tagged Immigration.  There you will find the numbers on Immigration showing that we have strayed from our roots and our immigration rate is well below where it has been in the past.  should loosen immigration policy.

Truth in Banker Speak

The advertising industry has benefited significantly from Bank of America's ad budget.  It is hard to imagine a human in North America that does not know about Bank of America's 1.5 trillion dollar pledge.  

I have to wonder if anyone is going to track what this means or if they do it.  

Here is a link to a page on the B of A website with a April 28, 2008 transcript of remarks at the Federal Reserve Public Hearing on the proposed merger between Bank of America and Countrywide Financial Corporation where Liam McGee, President, Global Consumer & Small Business Banking, Andrew Plepler, President, Bank of America Charitable Foundation, and Janet Lamkin, California State President outlined their intentions. 

It is a little long, with each of the three of them taking turns saying the same thing over and over.  Here are the basic details quoted from Liam McGee's part of the transcript:

I am proud to announce Bank of America’s new, and unprecedented, 10-year goal of $1.5 trillion for community development lending and investments. This is the largest community development goal ever by any company in America. In coming years, this goal is certain to enhance quality of life for millions of Americans in need, by:

• helping finance construction of affordable housing throughout the nation,

• providing loans and other needed capital to small businesses,

• supplying consumer loans, including housing finance, for low- and moderate-income and minority borrowers, and

• financing economic development for communities in need.

In addition, our Charitable Foundation is raising its philanthropic giving goal from $1.5 billion to $2 billion over 10 years. This is the most ambitious long-term corporate philanthropic goal ever announced by any company. We are setting this goal despite uncertain economic times.

I am glad that B of A has made a large commitment to community development.  This list however is just a list of things that bankers do.  So the advertisements saying that Bank of America is giving 1.5 trillion dollars back to the community are a little misleading.

Even so, a search on the B of A website for press releases about community reinvestment produced this from November of 2009:  (dramatic music here) 1 billion dollars!  Some simple math tells us that a 10 year campaign starting in April of 2008 is 20 months into its 120 month life or 16% complete.  I am pretty sure that 1.5 trillion is 1,500 billions.  So 1 billion is .067% of goal.  It appears that Bank of America is REALLY going to have to get after this in the remaining 100 months.

Has anyone seen any news items digging into this?  According to CNNMoney we have given B of A 15 billion dollars in bail out money.  

Even with the diminished capacity of the newspapers to do investigative work, this has got to be worth looking in to.

Physics, Nature, and the Rule of the Mob

Life is governed by the laws of physics, the laws of nature, and the rule of the mob.  Physics is "what goes up must come down". I don't know what the laws of nature are, but we say they have been violated when we see something really disturbing, so I am sure they are useful. And the rule of the mob is about to take down two companies we thought were invincible just a few months ago:  Goldman Sachs and Facebook.

There are undoubtedly books on the rule of the mob and I have not read any of them.  My description goes like this:  when a person or an organization gets to the top of the heap, it has to spend so much energy just staying at the top of the heap, that it cannot stay on the top of the heap any longer.  The timing of the process is highly variable, but the faster one gets to the top of the heap the more likely the mob will vigorously pursue a change in the hierarchy.  

Goldman Sachs got there slowly and stayed at the top for a very long time.  Most of us cannot even remember a time that Goldman was not at the top.  SEC Chairman Mary Schapiro was quoted in the Wall Street Journal on Saturday saying "If we don't get serious about this process, we may cease to exist." Goldman may own parts of the government, but this kind of resolve will be hard to overcome.  Who would you pick for longevity, the SEC or Goldman Sachs.  I go with the SEC.

Facebook blew past 300 million users to its current 500 million or so and its founder has turned down hundreds of millions of dollars to keep running it.  The tide is turning however and it is now cooler to quit Facebook than to use it.  The tech community turned against Facebook several weeks ago, and the rest of the mob will likely defect in the weeks ahead.  In fact there is a web site dedicated to this movement called Quit Facebook Day.

One interesting element to these actions by the mob is the lack of viable alternatives.  Goldman Sachs is probably not any more evil than any of the other firms on Wall Street.  Their unique crime is that they are just so good at taking their client's money.  Clearly market demand for a system we can use to organize our relationships on the web has driven Facebook to its current heights.  No clear successor has presented itself, although the mob is putting some weight behind the Diaspora Project, but four kids with an idea does not a viable alternative make.

If you are Mark Zuckerberg, or Lloyd Blankfein, you can be comforted to know that the crowd will only take you down a few notches and probably not out of the picture all together.  After all, your predecessors put you in good company.  Firms like Standard Oil, IBM, and Microsoft all fell victim to the mob.

Funny, my spell checker wants to replace "Zuckerberg" with "Boodsucker" -- even spellcheck has turned against him!

-image courtesy of www.thefirstreporter.com

 LATER:  NYT post from Friday about how the Web itself is a social network.

Know Your Place and Your Responsibilities

A few years ago I took a trip to India.  I was fortunate to meet many of the leaders of the business community in the capital city of New Delhi.  Like many people from the US I found myself in surrounded by people educated much better than I was, and I was prepared for that.  

I was not prepared for the widespread accepance by the elites that the good of the nation was more important than the good of any individual family dynasty.  Sure, they may have just been saying this, but there was some evidence to support it.  You may recall that just a couple of decades ago there were state protected monopolies in India for oil, cars, and just about every other major market.  These were owned by families and as we learned in Econ 101, protected monopolies are not efficient.  Somehow these powerful individual interests were put asside at what must have been an unnerving threat of financial risk to the people in power in exchange for an uncertain payoff as the Indian economy entered the open  world markets.

Now surely these families were seeking any advantage they could secure as they crossed the chasm.  But even so it was a show of defference to the greater good that we could learn from.  While in India the evidence of the caste system is one of the things that you just cannot avoid thinking about.  Being from the US, I do not believe the caste system will bring benefits to India.  I cannot help but marvel at the way the worlds largest democracy incorporates this complex history in a way that may just work.  

This past week I was fortunate to be part of a conversation at Mark Anderson's Fire conference about alternative energy.  Mark has done an amazing job with Fire and he continues to push the people attending to think of new things about how the future could be.  A few years ago he started the CTO challenge.  He assembles the CTOs at the conference into a team and challenges them to think hard about a big problem.  Not unlike a code-a-thon, this 48 hour effort is not expected to solve everything, but to apply a burst of creativity and concentrated energy with the hope of advancing the ball down field a bit.

This year the challenge was to think deeply about how to scale alternative energy.  Many ideas were presented, and along the way it was just assumed that any viable ideas must steer around the vested interests of coal and oil because those elites would never give up their singular pursuit of their best interests (or give up their lobbiests).  

At that moment it struck me that just maybe the responsibility the elites in India feel a for the best interest of their nation comes from the caste system.  Could it be that a horrible construct that condemns people to their place for generations also conveys a responsibility to the people at the top to do the right thing?  

My Current Thinking About Wall Street

After thinking and reading about this issue for some months now I have settled on the following set of conclusions:

•  The stakes are very high so we can expect the financial sector to continue to attract the smartest, most self assured, and most self centered people.
• Knowing that the participants are motivated almost entirely by personal gain, it is probably not fair to call them corrupt -- until they take positions in government.  Yesterday's action by the SEC vs Goldman Sachs puts an interesting twist on this one.
• The relative size of the finance and insurance industries to the rest of our economy is an important macro measure of economic health.  Finance and insurance certainly must be in the single digits, and 5% would be a good goal.

 Other Reading

Krugman in March 2009

NY Times this week about potential reforms

NY Times today about SEC vs Goldman Sachs

The Story of Angelo

Last night we went to a great Italian restaurant on our last night in New York City.  Angelo was our waiter and he did a great job.  We got to talking with him and found that he is a first generation immigrant, working while going to community college.  His dream is to work at the United Nations as a translator.  Because of our conversation, I now know that you must have mastered five languages in order to apply.  Angelo already has four, so just one to go.  A full third of our immigrants are Hispanic and despite the fact that I believe we are as open minded about race as any nation – I suspect that anti Hispanic sentiment is a significant barrier to our opening up immigration.  The twist to this story – Angelo is from Ecuador.  

Robert Rubin is No Boyscout

Former treasury secretary Robert Rubin had to pick between admitting incompetence or confessing to corruption this week and instead he declared that knowing Citi Group was out on a dangerous ledge was not his job. Since he was paid 100 million dollars to advise Citi on something, and since he was at one time the CEO of Goldman Sachs (who invented the complex instruments that caused the crash), what was his job? 

The only explanation is that Citi was buying inside access to Washington from Rubin - not his wall street expertise.  So this week Robert Rubin was telling the world that his job was to ensure that Citi was not regulated.  So I believe him when he says it was not his job to know what was on the balance sheet -- it was his job to make sure no one in the government knew either.

Here is a piece from November 2007 with some of the details about the things Rubin was not watching.

Here is a piece from October 2008 where the NY Times looks into the work Rubin did with Alan Greenspan to discredit Brooksley Born, who at the time was running the Commodity Futures Trading Commission, and who was advocating greater regulation of derivatives.

We ended up giving Citigroup 45 billion dollars -- so Rubin earned his pay.  He got each citizen of our country to give Citigroup $150 in bail out money.  His next trick?  Maybe his job now is to figure out how not to pay it back!  

Do Something You Love

The family and I went to the John Mayer concert in Seattle last night and it was a very good show.  A great reminder that we should all do something we love to do.  The band took a break, he did not.  The music was awesome and he thanked us for being there.  I had a great experience and recommend it to anyone who finds themselves in a town where he is playing.

How Much to Pay the Guy Driving

It is interesting how humans adapt to systems and even more interesting when you consider that humans created the systems.  The idea I outline here has a remarkable parallel in Jaron Lanier’s thoughts about how people react to computers.   It also may translate into thoughts about how much we pay CEOs.

Years ago in sailboat racing there was the International Offshore Rule.  The IOR rule was, like all of the rating rules before and hence, intended to be a fair way to handicap boats that were different so they could race against each other.  And racing rules like the IOR go through a predictable cycle just like businesses and cause people who think they are rational to do the most irrational things.  I submit that the phases for sailboat rating rules are invention, adoption, popularity, optimization, insanity, and retirement; and bear a fair amount of similarity to business cycles.

1. Invention happens about the same time the prior rule is in the insanity phase and one person wakes up one day and says that the current way of doing things is crazy and there has to be a better way.
2. Adoption is when that one person comes up with a better way and convinces others to follow.  Of course a better rating rule is no good to one person because the whole idea is to race against other people and without others – there is no point.
3. Popularity comes about when enough people defect from the old rule to the new rule (in sailing this is usually a process of getting your boat measured so you can get the new rating number, and then switching to sail in races governed by the new rule instead of the old one).
4. Optimization happens as the stakes get higher.  Now that a lot of people are sailing under the new rule and their natural competitiveness causes them to make changes to their boats to improve their ratings.  The funny thing about this is often the changes make the boats slower or more difficult to handle but the rating benefit more than offsets the performance handicap.  That is right, racing sailboat owners voluntarily make their boats slower in order to be more competitive. 
5. Insanity comes at the extreme end of this cycle when people spend hundreds of thousands of dollars to have new boats build with extraordinary shortcomings that could only be induced by the rating rule itself.  Strangely, and presumably for the same reasons that Jr. High boys find the outcome of flushing bleach down the toilet an irresistible attraction, this insanity phase can last for some time.  Eventually though the seeds are sown for next rating rule and usually by someone we usually brand as a geek.
6. Retirement of the old rule happens as the new rule gets to the popularity phase.

Followers of Schumpeter would call this a healthy market and a productive use of resources in the pursuit of higher performance.  And they could be right.  The most insane of the boats under the old rule really cannot convert to the new rule and get sold to outlying markets where the old rule has not yet run its course.  Depending on how insane the insanity was there is a reasonable counterargument that the resources invested at the end of the cycle do not produce anything useful – excepting maybe creating a fertile environment for the new rule.

During the insane period of the IOR era the custom built boats had a distinct hollow section in the shape of their hulls where the measurements were taken that sucked the boat down into the water - so the boats were very squirrelly sailing downwind when it was windy.  This hollow section and other elements of the rule induced the designers to put up massive amounts of sail area downwind with oversized spinnakers.  So here you are going downwind in heavy wind with these giant sails pulling the boat forward while the back of the boat is getting sucked into the water by the hollow section and the combination would induce a death dance of wild rolls from one side to the other - and yes you can put the mast of a 15 ton racing sailboat into the water rather decisively.

There were only a few people on the planet that had the right combination of skill and bravado to drive one of these boats downwind in a breeze.  You had to steer very aggressively and often times at the end of a roll, right before you could wipe out, the rudder would start to lose its effectiveness and the best thing to do was just let go, watch the wheel spin wildly and then decisively grab the wheel to reestablish flow over the rudder and send you down the next wave – if you were lucky.  It was quite a thrill and even with the reverence in the business for accomplished downwind IOR helmsmen, most people were quite glad not to be driving. The strange thing is that the properly designed boats with clean lines needed less sail area, stepped up on a plane going downwind in a breeze, and actually got more stable.  And they could be driven by mere mortals and with very little drama. So, who should get paid more, that crazy guy in the IOR boat driving like a madman while everyone else holds on for dear life, or the guy in the properly designed boat with almost no visible effort and the hearts of his crew beating hard because of the thrill and not the terror? 

Bear in mind that when the IOR boat wipes out the race is pretty much over, and some big checks are going to have to be written to sail makers and the boatyard.  And the boat not designed to the IOR rule?  It would actually be going considerably faster through the water. This is why we pay CEOs so much these days – let’s hope someone invents a new rule soon and makes their skills obsolete.

Our Healthcare Story

My hat is off to the Obama team for getting the healthcare legislation rolling.  I admit I have spent less time than I should following this because I did not give it much chance of getting off of the ground.  Frankly, I really do not know how this is going to impact our business or our employees, but at this moment I am willing to give the thing the benefit of the doubt and assume this is a step in the right direction.  In thinking about what value I may be able to bring to the dialog, I thought I would post what I learn as I learn it and therefore provide one real world data point for people to follow.  

With that in mind, here is a condensed overview of the current healthcare situation at CSG.  

Current Situation:  We are in our fourth year of what some people would call self insurance, and I call a do it yourself healthcare plan.  With the help of a broker, an administration service provider, and two reinsurance companies, we have assembled our own healthcare solution.  We struck out in this direction with two stated goals:  1) get control of costs and 2) prevent our benefits from sliding back any further.  Our costs (equivalent of a premium) are $414.04 per individual and $1,182.99 for a family, and we use a preferred provider network that gives our people access to a good number of doctors for a reasonable co-pay and a manageable deductible of $500 per individual and a maximum out of pocket of $2,000 per year per individual.  For this we require individual employees to pay 25% or $103.51 per month (and the company pays $310.53).  We also offer dental at $40.91 total with an employee contribution of $10.23.  For families we require the employee to pay 75% -- which is quite a burden on the employee, but we do it that way because the cost to the company is the same as for an individual.

When I started the company in 1997 we paid $129 per individual and had lower co-pays, lower deductibles, and lower max out of pocket.  We never had a year with less than double digit premium increases (by percentage) and by the time we bailed out of that system in 2004, our premiums were up over 3X to $496 per employee per month.  Our benefits were diminishing every year and our people were fighting with the insurance company over far more claims than we thought they should.  

We offer healthcare coverage on these terms to every employee that has been with the company for 90 days or more.  We do not require our employees to purchase healthcare and some elect not to because they get coverage elsewhere or perhaps they go uncovered.  Because of these variations in the number of employees electing coverage, the company's portion of the cost of healthcare has ranged from a low of 4.09% to a high of 7.40% and an average of 5.92% over the four years 2006-2009.  Because of the mix of individuals to families, the company only pays 67% of the total cost, making the average total cost as a percentage of payroll 8.83%.

I will do my best to share how the new healthcare laws impact our company.  Feel free to post your experiences.

Immigration Numbers

To answer those that say immigration is at an all time high, here are the numbers.  The immigration numbers are from the Migration Policy Institute and the population numbers are from the US Census.  I am sure there are immigration numbers in the census, but I could not find them.  If anyone wants to point me to them I will remake the charts.

The short story is that annual immigration hit 1.285 million people in 1907 -- which at the time was 1.5% of the population, and then declined all of the way down to .02% of the population in 1933 and did not exceed the 1907 number until 1990 when we hit 1.535 million people.  By then the country had grown enough to make that only 0.62% of the population.  In 2002, the last year for which I found data, we settled in at about 1 million people per year or .37% of the population.

Importing The Desire to Win

There is one common thread that runs through the three main problems with our public education system.  The three main problems are: the administrators, the teachers, and the students.  The common thread is the desire to win. If we could just change this one thing, we could actually reform our public education system and establish some momentum on the path back to worldwide competitiveness.

The enemy of the desire to win is entitlement.  Our students feel entitled to a good life without having to work for it, our teachers feel entitled to their jobs without performance measures, and our administrators...well they are so deep in their own goo that they have not thought about actually fixing education for over a decade.

We can do this the easy way or the hard way.  The easy way is to open the immigration floodgates and import the desire to win.  Sure the contra argument is that freeloaders would come in with the tide -- just to get our awesome healthcare.  But they will be a tiny minority.  The rest will be energetic, motivated, people with the desire to improve themselves and their position.  This is not an original thought and it worked for our country for its entire history -- save the last 50 years or so.  

Thomas Friedman's column today absolutely nails this point.  In it he cleverly lists the names of the finalists for the Intel Science Talent Search - which even the most ardent anti race profiler cannot help but admit hail from points east from here.  

These amazing people all share two traits -- they came to America to change their stars, and they have an insatiable desire to win.  If we could only get more of them.

Crowd Vindicated

A couple of days ago I posted that the most emailed article on the NY times was about dishwasher detergent -- and how that disqualified the crowd from picking the most valuable stories. Well today the pendulum swung back towards the crowd as David Brook's column hit the top of the list.

It is quite a good column by the way.  I know I am not alone thinking that our country is in a bad way, and I would argue that one of our biggest problems is that we are still a considerable distance from rock bottom.  

We are smart and creative problem solvers.  We just don't think the problem is big enough yet.

3 Strikes on Washington

I have been resisting the urge to weigh in on local politics.  Today the flood of data became more than I could hold back.

•  Here is an article from the Puget Sound Business Journal last Friday where our State Legislature is considering taxing everyone with income over $200,000 in exchange for lowering the sales tax.
• The union membership statistics were released Tuesday by the US Department of Labor:  we are the 4th most unionized state in the country (20.2%).
• Here are the numbers on high school graduation rates in our state as reported by the National Center for Educational Statistics:  we are 34th in our ability to graduate students from high school (72.9%).

 Sure there are states in worse shape than ours.  I wonder how much farther down we are going to go before we figure out how to solve some of these problems.

No one ever wants to end on a sour note, so here is another article from the Puget Sound Business Journal:  SeaTac was No. 1 in on time arrivals in January (86%)!

How Data Changes the Idea of Insurance

The more we know the less we need insurance.  The whole idea of insurance is to protect oneself against an unknown potential loss.  Insurance works because of pooled risk.  A group of people with diverse risks contribute into a pool.  The funds paid by those not experiencing a loss are paid to those who experienced the loss.  Along the way the insurance company gets paid a bit for managing it all.  This applies to all insurance of course.   Hear are some thoughts about health insurance.

People were much more willing to accept this structure when they were reminded daily of the risks inherent in life and their general inability to avoid those risks.  Insurance companies were much more likely to be satisfied with this arrangement at a time when they had no way to know who presented the greatest risk to the pool.

All of that is different now.  Many people believe they have enough data about their exposure to risks -- that they may not need insurance at all.  When employees pay their full healthcare premium they can easily see that they are paying out more every month than they are getting in benefits.  Combine that with a sense of security regarding potential risk and you get a pretty good explanation for some of the 50 million uninsured in the US.  The fact that 27% of those aged 18-29 are without insurance and 28% of those making under $36,000 go without insurance -- compared to the national average of 16% -- leads me to believe that many of the uninsured could afford insurance.  A study conducted by Mark Pauly of the University of Pennsylvania and Kate Bundorf of Stanford, concluded that nearly three-quarters of the uninsured could afford coverage but chose not to purchase it.  (this last sentence was lifted from this article on the Cato Institute web site).  

The greater ability to analyze data has given insurance companies the hope of making money off of every customer -- instead of the pool.  This can be done through the all too common tactic of just denying every claim -- which ends up contributing to more individuals opting out.  It can also be done by gathering more and more data about the risk associated with each additional insurance customer and customizing the pool to have as little risk in it as possible.

As we progress down this road, we leave the realm of insurance and enter into the realm of expense management.  Maybe if we just let the industry evolve on its own, we will end up with more and more individuals responsibly managing their health care expenses on their own.

Would You Pay $4 Per Hour for Healthcare?

We do.  I suspect just about every other company in the US that is actually trying to provide healthcare to their employees is paying over $3 per hour and many probably pay even more than the $4 that we pay.  A high wage individual may be willing to pay more for healthcare than a low wage individual, but the cost does not change as income levels change.  So this is a much bigger issue for low wage earners than the others.  Most employees don't think about this all that much because they don't participate very much in paying the bill.  Many economists argue that if healthcare costs go down, wages could go up.  If that did happen, the low wage earners would benefit the most because a $1 per hour increase for someone at minimum wage is a 13% pay increase.

It will never happen because there is no one in DC representing the interests of the employee.  Our government cannot control healthcare costs because they don't want to.  They are beholden to the very people (health insurance industry) that would be hurt by cost containment.  It is never going to happen.

The only shred of good news in the whole story is our government is also highly unlikely to pass any reform, so we may be able to avoid a whole bunch of pork piled on our broken system.

The Economist: Is America Ungovernable?

Last week the Economist magazine posted the question to its readers:  Is America Ungovernable? 

Their main point was that the party in power had more power than any administration in memory and still could not get anything done.  The comments back from readers followed the lines you would expect:  the R's blame the D's and visa versa.  The Economist circled around and said that in fact the government is working.  A very interesting debate indeed.  

I would say that we are generally not worried enough about the future of our country.  Properly motivated we know we can solve any problem.  Each entity involved today is mostly focussed on getting some for themselves -- the political parties want more power, the politicians want to be re-elected, industries want the paying field tilted in their favor, and companies really cannot do anything but look out for themselves.  Everyone must know the trend is unsustainable, but so did everyone when they were buying tech stocks in 1999 or real estate in 2007.  Sure it will end someday, but I will get mine and get out before it happens.  

We can only hope that we will wake up to the precariousness of our situation and turn our attention away from personal greed and to fear for the survival of our country.  Then we can get down to the business of governing.

What to do with the Cash

We give China $20 Billion in cash every month (our trade surplus).  Other countries give China cash too.  This is a big problem for China -- because they are running out of places to put the money.  They put some in US Treasuries -- but we pay essentially zero interest, and they already have a trillion dollars of our debt.  They put a great deal into domestic projects, but there is a limit to that (inflation). They put another small mountain of cash into pre-purchasing natural resources like oil and copper from other countries, until those prices go up too much and everyone screams.  

Now they are building infrastructure projects in other countries as reported in the NY Times.

It should be a priority for us to figure out how to stop giving them all this cash.

Avatar Reflects Our Reality

I finally saw Avatar this weekend. I don't plan to get in the habbit of reviewing movies like I do books but it did bring up a few thoughts. First the 3D is pretty cool and when putting on the glasses I was kind of wishing I had not come to the 3D version, at the end however I was glad I did.

James Cameron takes the same old story that white people will kill indiscriminately in the pursuit of natural resources and makes what I think is the central arument of the movie: yes we did it 100 years ago and we will still be doing it in the year 2154.

This reflects the current pessimistic outlook on our ability to govern and projects it as a trend out 150 years. The recent NBC-WSJ poll shows that we are in the double digits for the first time ever on the number of people (11%) who responded "never" to the question: How much of the time do you trust the government to do what is right? An all time low of only 19% answered "Most of the Time" and 4% answered "Just about always" (not a record). Full poll results here:

I sure hope we find some leaders in our government that can actually do something -- and it would be even better if they did something right.

Two Big Speakers this Week

Two of the most iconic figures of our time took the stage this week. To someone who has been a student of public speaking since I took my first public speaking class in the 9th grade I am bound to find the performances interesting regardless of the content or context.  Add to this my interest in both technology and our nation and Wednesday was quite a day.

Steve Jobs Introduces the iPad

Technophiles and ordinary citizens alike are all hoping this is not the last new product presentation we get from Steve Jobs. His gifts are many and to see them on display is a thrill. He himself has raised the bar so high with the Mac, the iPod, and the iPhone that it seemed almost impossible for him to deliver yet another home run. Of course only time will tell on the success of the iPad but and I found the presentation to be short of my own expectations.

He did not help his credibility when he massaged the numbers to position Apple as the largest mobile devices company in the world. Comparing all of Apple's forward looking revenues to just the current mobile devices revenues of Sony, Samsung, and Nokia does not hold up to event the dimmest scrutiny. This illuminated the fact that he was really speaking to the already converted and I find that the underlying fabric of the whole presentation and product.

There were many references to how the iPad will interact with existing Apple products. This emphasizes the closed nature of the Apple environment, and with their own chip, the porting of existing iWork apps, the exclusion of flash, and the extension of iTunes into iBooks -- this is putting another layer of bricks on the wall around the Apple community. The fans are going to love it, but the product is not cool enough to be the catalyst to new conversions from other platforms.

Ahead of the announcement some had speculated that the device and deals with content partners would save the TV industry. It appears that was never part of the vision for the product. Featuring the NY Times was nice but incremental -- no revolution there. As a gaming platform bigger is better, but gamers are not going to make this their main device -- so I don't really see that as a big change either.

In the end I did not think Steve really was wowed by the product either. If they have sold 250 million iPods -- they clearly will sell tens of millions of these things. But the primary motivation will be for one Apple fan to tell another Apple fan that they have it.

I will get into my thoughts about the Apple upgrade cycle some other day, but that is another reason to not buy the iPad now. Apple will continue to innovate on the platform and 12 months from now the new version will be cooler, cheaper, and maybe not even backwards compatible with this one.

Regarding killing the Kindle -- since Steve proclaimed that ALL iPhone apps work out of the box on the iPad -- that means that anyone buying the iPad can read their Kindle books on the Kindle App for the iPhone. This is great news for Amazon. Amazon has never been a hardware company and I bet they make much higher margins on the books than the Kindle device. So iPad could mean more Kindle book sales for Amazon. Also, Jeff Bezos will be off the hook with the publishers now that Apple is in the biz. So I don't think the Amazon people are going to be unhappy about this.

President Obama Calls it Like it is

It has been quite a year for the President. The vitriol between the parties has left everyone diminished and the independents in between seem to jump back and forth every day. It will be years before we understand how the decisions made by our well intentioned President re-shape our universe. Getting out of the financial crisis by turning from bank regulator to bank owner, and getting out of the war by putting more of our people in harms way, are hard things to explain even when over half the members of the choir are your own.

The good parts came when the President focussed our attention on the reason we need to make changes: The "How long should we wait? How long should America put its future on hold? ...I do not accept second-place for the United States of America." sequence hit the target right in the middle. All of the references to the things we are going to do -- particularly those laced with details like forgiving student loans in 20 or 10 years or $20 billion in savings in government spending next year -- do not resonate at all because we are skeptical about our government's ability to do anything. With the possible exception of sending tax dollars to special interest groups on Wall Street and the Pharmaceutical companies -- there is very little evidence that our government can do anything.

One year into his term, the repeated claim that the problems were not created on his watch, were tiresome and hurt his credibility.

Our President did rise to the occasion however and he showed his resolve calling out the "Deep and corrosive doubts about how Washington works." His proposal to put all earmarks on the web is bold and would be a big step in the right direction. His willingness to get some of the mud on himself by calling out the broken nature of our political process is great leadership. President Obama believes that the government can do good work. He has called out the bad stuff, committed himself to do something about it, and I believe his intentions are honorable.

We should not give up hope and all of us should do what we can to contribute to his success.