This last week was filled with events that made me wonder how many of our leaders had sent their brains to wacky land. On the political front, the U.S. president, our president, threatened financial default and elderly folks on fixed social security incomes in order to get the U.S. credit limit raised. Threatening old defenseless folks always works so very well, and the collapse of the U.S. credit rating would do wonders (he says sarcastically) for the U.S. recovery.
On the right, folks were walking out of meetings and taking the equally brilliant tactic of not actually negotiating. But this was all topped by News Corp., which got caught hacking into the phone of a murdered child and was accused of doing the same to 911 victims. Then, instead of holding the folks who did it accountable, the company used Bizarro decision making to retain the top executive responsible while firing the rest of the company. Seriously, they really did that — it’s not a joke. Which, and this should have been obvious, only made things worse.
Some of what is coming outdefines “twisted.”
I’m going to look at the crazy folks who are running things this week. I’ll close with my product of the week — a US$1,000 computer keyboard that suggests what the PC could have been but unfortunately isn’t. (My wonderful wife got me one for an anniversary present).
Fixing the Debt Crisis
If the U.S. were a company in financial trouble, and any entity that is spending far more than it takes in is in financial trouble, we would fire the board and the CEO or shut it down. Seriously, this is how we do things in the commercial world. To net this out, we have a country that is deadlocked and divided. On one side, we have folks focused largely on preserving entitlements — and on the other, folks who are trying to preserve wealth. Neither side is focused on the core problem, which is that the country isn’t bringing in enough money — and I don’t mean taxes.
Only a country would look at fixing a revenue problem by effectively charging the employees increased fees. That’s what income taxes are. It would be like a firm deciding to take money out of your paycheck. We could call it a continued employment benefit to address a problem that really has to do with the company not selling enough products and giving too much away to other companies for free. It would take Andy Grove, Steve Jobs, or Larry Ellison about 30 seconds to come up with workable solutions.
If the U.S. sells far more things to the rest of the world, or buys far fewer things from the rest of the world, the economic problem self corrects. When you’re broke, you make hard choices.
So let’s take a series of billion and trillion dollar costs we could cut with relatively little pain.
For instance, the War on Drugs. It costs billions ($23B so far this year); it is largely about as effective as prohibition was (marijuana is one of California’s biggest and most profitable businesses — that isn’t taxed); and it is killing kids who try really stupid ways to get around it. Make drugs like alcohol: tax them, regulate them, assure their quality, and turn a money hole into a source of income (folks are going to use them anyway). The whole concept of the “War on Drugs” sounds like something a creature who had never met a human would come up with. It doesn’t work. It can’t.
How about NATO ($7.6T in 1996 cost to the US), which is basically a security service for the rest of the world, as Larry Ellison or Steve Jobs would say. If folks in the rest of the world want us there, they should pay the freight.
And as for nation building ($787B Iraq, $433B Afghanistan, $1.2T total), not only do we suck at it — we also can’t afford to do it. We don’t even need to get to the “should we or shouldn’t we” part. Like any company or family, if you don’t have the money to do something, you don’t do it — well anyway, you shouldn’t do it in the first place. We seem to have this idea we should pay others to let us do the police job. Trust me — that isn’t any way to run a business.
Medicare/Obama-care/entitlements. The issue of whether we need them or not is laughable given what a great healthcare program Congress has voted for itself. Our core problem is that our medical costs are several times what they are in other countries; we have both the worst coverage and the second-highest cost. If you had this kind of a program in any company, a smart HR manager would have fixed it years ago.
Finally, we could just eliminate the massive problems of graft and inefficiencies in government services. In effect, bring in a team of turnaround managers, give them the authority to actually act, and let them focus on making government more efficient.
In the end, though, what’s really not working is government — and if this were a company, we’d start by cleaning house at the top in order to actually get things done. Elections are coming; I’m getting on the “throw the bums out” train.
A World Without News Corp.
One of the advantages in aggregating a large chunk of the conservative media under one company is that it can be coordinated and the power multiplied. However, we are now seeing the disadvantage — and that is that if the parent gets into trouble, as is often the case when too much power is aggregated, the entire structure can collapse, shifting the balance of power in the other direction. In short, this last week was a great week for MSNBC (and for “The Daily Show.” This is both funny and sad).
The allegations of wrongdoing are now spreading to other News Corp. properties and have been connected to U.S. 911 victims. It seems that it is only a matter of time before U.S. news companies are accused of these cellphone hacking crimes. Recall, these are connected to a practice called “pretexting,” which became visible during one of the HP scandals. At the time, it was identified not only as common, but also, in many cases, legal (turns out It wasn’t).
Murdoch’s “burn the bridges” approach to the problem was ill-advised. What he should have done was punish those who had used the cellphone hacking practice inappropriately and then ban the practice.
By shutting down the entire paper but retaining the head of it, he gave the impression of a massive attempt at a cover-up, and the result was a feeding frenzy, with tons of now-fired employees who will likely share that hacking into cellphones wasn’t the only questionable thing being done.
Containment may be impossible at this point, and that places the following publications and properties in the U.S. at some risk: Fox News, The Weekly Standard, Barron’s, the New York Post, The Wall Street Journal and The Times. Entertainment properties are probably safe but could experience turmoil if News Corp. is broken up (now possible).
As I was finishing this up, a Murdoch interview showed up in the WSJ indicating he was very pleased with how all of this was handled — yet another mistake, given the broadening probe.
News Corp. is instituting an investigation, though — like I suggested — and one would hope it might rethink the closing of the News of the World, given the majority of folks there who lost their jobs did nothing wrong, and the closing didn’t have the intended result. Bad decisions can be reversed.
Wrapping Up: Lessons Learned
We often talk about running the government like it was a company. I think the politicians should remember that history does suggest if they can’t get work done they will be replaced — and as many of the revolutions now going on suggest, that isn’t always done very nicely.
In the end, the problem won’t be fixed unless the government focuses on making the U.S. more profitable; taxing the rich or taking away services just won’t get the job done.
The lesson from News Corp. is don’t commit crimes to get news, and when caught misbehaving, punish the folks who made the mistake. Blowing up the company in an attempt to protect the executives doesn’t work. Oh, and just because you make a bad decision doesn’t mean you can’t reverse it and do the right thing. You listening, Netflix?
Product of the Week: Datamancer Steampunk Keyboard
I look at the Datamancer products as things from an alternative world. They are what would have resulted had we continued down a Victorian age of individual craftsmanship and away from assembly line, mechanized production.
My wife bought me an Aviator (here is the line on eBay) for our anniversary, and now I want the matching monitor. Using the keyboard allows me to imagine life as it might have been: different, perhaps less harried, more elegant, and a lot more magical. Where having a rocket belt or a ray gun seems just over the horizon.
This has become my dream keyboard, and by this I mean it helps me dream. It is functional art. I think we could all use a moment of magic from time to time, and because the Datamancer keyboard brings such a moment to me — and especially because it is the best thing my wife has ever given me since she said “yes” — the Datamancer Aviator Keyboard is my product of the week.
"On one side, we have folks focused largely on preserving entitlements — and on the other, folks who are trying to preserve wealth."
Someone else institutionally (in the sense of parroting the surface arguments being thrown around, without looking past them at what neither side wants people to question) clueless about what is going on.
Ok, so here is a hint. Most of those "entitlements" are things like checks to elderly people you are whining about being threatened, and most of them paid **from** money that is specifically taxed, to fund those programs. The problem with most of them is that certain politicians have been robbing the funds for decades, to make up for short falls other places.
The second problem is.. Well, if you know that you have 4 departments in a company, all taking materials from one source, all doing nearly the same job, and someplace money is disappearing in the mess, you don’t close the entire company, or even the entire collection of departments. You send in a damn auditor, consolidate the departments, if possible, then fire who ever is stealing the money. If it turns out that someone is also cooking the books, or playing games with them, such that money that was "supposed" to go there, is either a) never being collected, or b) not getting to it, you fire them.
The side you quote as "preserving wealth" have been a) actively working on creating and maintaining loopholes which prevent "collecting" any money, b) shuffling funds places they don’t belong, c) undermining the checks and balances (or even in some cases making them overly complex, and thus unenforceable, that would prevent the problems), d) insisting that the real problem is that too much money, in general, is being given to the departments, and e) declaring things redundant, even when they are not, having neither the interest in fixing the problems, nor understanding them. Worse, they want to be the new CEOs and managers of *all* of the departments, because they can then do more of a, b and c, and one sure fire way to do that, if you don’t really care about any of the low end employees, or stock holders (i.e., the voters), is by intentionally making things complicated, misunderstanding the problem, and then demanding that all 4 departments be simply done away with, since its, "Now to complicated to fix!"
The other side is doing a bit of (b) themselves, and I am sure there are some doing a few of the others, for their own political reasons. But, the fed, in terms of taxes, is playing the same game that the banks did. They create "loans", or pay outs, leveraged against possible future income, hand those things out to people that have no intention to pay, and will use every means possible to not do so, and now they are standing around pretending to be confused by why the government doesn’t have is, lets say to pick a hypothetical company called Widget Corp., $200 million in the hole, when they should have gotten $100 million in taxes from them, but gave them $150 million in tax breaks and loopholes, then handed them a $50 million dollar refund at the end of the year.
Yet, taxes, as you say, are not the problem… Only if you think giving away money to people, including ones that tell you they don’t want or need it, then *not* collecting any interest on it (i.e., all of the taxes due), is somehow not a "tax issue".
The rest is just a flat out refusal of both sides to not *cut* budgets, but to figure out why the hell they cost more than they should. Hint – To do that means spending some money now, to figure out what the hell is wrong, then fix it, so you don’t spend as much later, when its finally fixed. Health care, as an example, cost us more, by doing things the may we did before, and would cost even more if 100% private, than any other country in the western world. We have more technology, more resources, more everything. Only.. Everything we make, including those medical devices, are produced some place else, so we spend probably 50% of our health costs paying ***some other country*** to build the shit we make. We let insurance companies (they even got sued over this, and sort of, but not quite, lost) set the "minimum" prices that supposedly exist for treatments, then let them go whining to the Congress to up the amount over that faux cost to 35%, instead of the 25% they where already commit highway robbery to get out of our pockets.
In short, we *should* be able to build more technology than anyone else, have enough resources to make medicines cheaper than anyone else, etc., **and** have the result cost us less, in general, that it does any other country in the world. Yet, we spend more than all of them, buy nearly everything, including some medications, from over seas sources, then let "companies", instead of doctors, decide how much their own services cost, and we opt to listen to idiots that *claim* that this vast neglect of our own resources and common sense is "comparable" to some place like Sweden, where nearly 100% of everything they have medically comes from outside, not because they are too stupid to make it themselves, but because ***they don’t have the resources to even try to do so***.
We manage to have 5,000 times the resources of nearly anyone else, save China, we are 5,000 times stupider, in that we sell it to China and have *them* make the products for us, then we dare to claim that we even have a damn clue what medical care should cost, or that somehow private companies can handle it better, instead of making it 5,000 times worse, than our government has managed. And we compare the troubles countries with "no" resources, "no" industry, who send their people to *our* schools to learn technology, and who are, in fact, more than 50% dependent on *us* for every single thing they use to treat their own people, to our healthcare industry, and claim that its proof it can’t work here… Bloody Frell!! Next your going to tell me that because people can’t water ski in the desert we shouldn’t bother selling ski boats near the frakking ocean.
From top to bottom we do every thing backwards. We make almost nothing, we sell half of what we do to other people, hell, North Korea, you know, the people that are *not* our allies, are using technology *we* invented to provide their people with non-free, but never the less 50mps+, fiber optic, internet access to everyone in the country. We can’t even provide 9600baud dialup to 25% of our own country, never mind cell phone service. They have stuff in N and S Korea that looks like it came out of sci-fi movies, while we have people in this country that probably would still think "ghosts are hiding in the engine", if they ever so much as saw a steam locomotive, never mind *ever* any sort of high speed, light rail.
The government is serving TV dinners, while handing out caviar and champagne to people that make 500 times what I do a year, and then "claiming" that the problem is that they don’t have enough money to keep serving TV dinners, so we have to cut the people, like me, still paying into SS and Medicare, etc., back to pop tarts. After all, its not like I intentionally told the government that I wanted to pay *into* those "entitlements", so I would have them later, like.. you know, it was bloody contractual or something.
Shorter version – Closing the company is only an option if the company "can’t" provide any services, and no one is willing to buy any. The later is almost true, but its called paying 10% of taxes, when you where charged 26%, and using some of it to pay people to argue that you shouldn’t have been charged so much in the first place. The former simply isn’t true.
Doing so because you can’t, won’t, or don’t want to bother, to figure out who in the company is actually lying, cheating, stealing the office supplies, or running their own side business using company funds… well, that might be semi-viable, for a corporation, where the expectation is that the employees *might* find another job. Its pure idiocy when you only have a) one government (i.e., no where else to get any of those services), b) more then 9 million people are out of work, and another 2-3 million are not even on the list of people out of work, and c) the result is going to screw "everyone", except maybe the upper management, which are busy shifting money over seas, where, if everything blows up, some of their money might still be worth something (or at least their personal side business will be).
That is the true disaster here. Not the fact that one side is "too interested in defending ‘entitlements’". All that is is a stupid buzz word, invented to smoke and mirrors what they *really* mean when they talk about the number of things they will f-up, i.e., cut, which normal people depend on, if they get what they want, while simultaneously keeping all the money other things, and expanding new programs, to make sure everyone is, what is it this week, that we are not wearing gay underwear, or some similar thing they plan to make a jail-able offense?