Retrenching into silos is the exact opposite of what is needed

With the advent of more terrorists’ activities around the globe and the significant refugee crisis, nationalistic and jingoistic behaviors have taken more solid footing. With the backlash in some European countries, the Brexit vote and the rise of Donald Trump as an unlikely candidate for US President, show that protectionism is selling these days as a concept. These folks want to build actual and proverbial walls, rather than bridges.

Yet, that is precisely the wrong behavior needed. These so-called leaders feel if we segregate and retrench into our own little worlds, this cocooning will make everything better. What these so-called leaders fail to tell you is the significant benefits with being aligned, working together and doing commerce with each other. Economic trade breaks down barriers, as countries do not want to upset the financing of their economy and will work past governing differences.

President Abraham Lincoln did not coin this phrase, but he capitalized on it – keep your friends close, but keep your enemies closer.  Lincoln added several adversaries to his cabinet when elected. His view was if he could keep tabs on his opposition and argue with them, he could keep a lid on dissent at a time when dissent was in vogue. President Teddy Roosevelt was very open with reporters, in part because of his ego, but in large part to have the reporters be his eyes and ears. He would have them go speak with his department heads to learn what was going on.

Commerce breaks down barriers. Not only will we make more money by co-existing, we will be safer in turn. That is a concern of the Brexit vote, as the UK being a part of the EU makes the world safer and aids the economy of both entities. Like the UK, there is much to be gained in the US with the global economy, especially with companies who employ people here. Just here in Carolinas, there are multiple hundreds, if not thousands, of foreign companies who have US presences here, be it a North American headquarters or a major plant. BMW, Mitsubishi, Michelin, Doosan and Husqvarna come to mind.

We should not lose sight of breaking down barriers abroad. I have been a staunch supporter of doing trade with Cuba and Iran. The countries want to do business with us and we are well positioned to leverage that travel and trade. Just with Cuba and its 11 million people, it will be like adding a 51st state to our US economy. With Iran, of course, we need to keep our eyes open, but the median age of Iranis is age 35. We have a chance to create new economic paradigm with Iran which will live beyond the older regime. Plus, being closer to Iran will allow us to keep more tabs. This is the  best example of what Lincoln did.

The candidates who have touted building walls and retrenching are not being very open with the whole picture. They are using fear and an incomplete picture of reality. Companies have always chased cheap labor and as one CFO said in the book “The Rich and the Rest of Us,” if companies could get by with hiring no employees, they would. The greater threat is technology improvements as a new plant is not going to have 3,000 employees, it will have 300. On the flip side, Nissan in Tennessee and Mercedes in Alabama employ a great many American workers, which is not talked about enough as a benefit of globalization.

If we retrench, we will be reducing markets for goods and services. A venture capitalist once said what creates jobs is not owners, but customers. The fewer the customers, the fewer the jobs. But, with that said, there are elements of truth that workers need to ask more of the employers who have suppressed wages and let people go, to hire younger and cheaper workers. Companies are quick to hire cheaper, but need to be reminded that we employees are important and customers, as well.

I am reminded that two of the top three jobs creation Presidents had two things in common. Bill Clinton, the number one job creator at 22.8 million jobs, and Ronald Reagan, the number three job creator at 16.1 million, were both collaborators and advocated global trade, as reported in “The World is Curved” by David Smick, who was an economic advisor to both. Creating markets for trade and opening up our markets to others, in my view, is one of the best things a President can do.

Globalization is extremely important, but we need to manage it better. Throwing the baby out with the bathwater is something we must guard against. So-called leaders who are advocating this very thing need to be asked more questions. As they are not telling you the whole story.

 

China, Cuba and Iran

Former President Richard Nixon became the first president who almost was impeached and would have been if he did not resign. Yet, in spite of his troubles at home where he ran a disinformation and burglary ring from the White House, he did make a huge difference in opening up dialogue with China. His efforts and those of Secretary of State Henry Kissinger, paved the way for changes in the economic relationship with that country which led to growth there and abroad.

I bring this up as when we look back in forty years at these moments, we may be able to say the same things about Cuba and Iran. Both have very young countries, with the youth crying out for better ties with the west and the products and services they bring. Yes, both countries are not being led the way we would want, but I believe having commerce with people is the best way to break down barriers. At some point, the commerce is so important, that it will be preserved and more dialogue will occur.

Of course, we need to move forward with our eyes open, but it is far better to find common ground than to beat on your chest and refuse to enter the sandbox. So, from where I sit, I applaud the President for opening up these countries to more dialogue, just as I thought as a teen that dealing with China was exciting.

We will see the positives with Cuba much sooner, as tourism will be ramped up this year. The president’s visit was a huge step forward. But, I think having a better relationship with Iran will pay dividends as well, yet I am not foolish enough to say trust them completely. So, let’s be cautiously optimistic and guarded as well.

 

Let’s be practical on issues of the day

One of the challenges in our current political construct is we are debating issues from the ends and not the middle. The ends represent extreme points of view who show less a willingness to compromise, some even within their own party. Yet, if we strive to discuss the issues and their complex causes from the middle, we will find more agreement and can get things done. Mind you, there is no perfect legislation, but oftentimes legislation and reasonable oversight is needed to govern and debating from the extremes stands in the way.

With an eye toward being practical, let me make a few observations that would enable better governance and get our national leaders back on better footing. This approach would also apply to state and local governance as well.

Immigration: Truth be told, if we deported everyone that some want us to, our economy would be harmed. Hard working immigrants and illegal aliens are not replacing Americans in jobs. They tend to be doing jobs that Americans do not want. If you truly want to stop illegal immigration, stop hiring them and that goes for our more conservative friends who are doing some hiring, too. Since we are not prepared to do so, then we need to work out a reasonable path forward. I would begin with the Senate Bill which was passed on a bipartisan basis twenty months ago.

Guns: Americans are killing too many Americans. Further, Americans are committing suicide at a rampant rate, by far the greatest reason for gun deaths in America (about two-thirds of annual gun deaths). The NRA represents gun sellers and not gun owners. Their voice has been heard. Now, let’s listen to parents and act like adults. Americans favor background checks on all transactions. We favor more elongated waiting periods. The police has recommended codifying bullets to better solve crimes. We should at least do these things as well as addressing other issues, but let’s start from the middle.

Jobs and economy: Some do not care to take notice, but the economy has been on the rebound and job and wage growth have been occurring. This is in contrast to other countries who are in or may fall back into recession. Now, we need to continue to retrain and develop people for new careers as we have a skills gap. Efforts have been under way within our community college systems with federal, state and local investment. Let’s further those efforts. Let’s also invest in our infrastructure and new renewable energy. We have needs and jobs in renewable energy are growing at a fast clip. There are almost twice as many solar energy jobs than coal energy jobs in the US and the sun shines in every state.

Trade agreements mean more economic growth: This is a path forward that has always been a growth enabler. An economic advisor to Ronald Reagan and Bill Clinton noted this similarity between the two. President Obama has also been pushing trade in Asia-Pacific, Latin America and Europe which is excellent policy. And, with their 11 million people and proximity, the US Chamber of Commerce has regarded favorably lifting the embargo with Cuba, which is as large as an US state.

Health care: Let me reiterate a message that continues to get drowned out by those who want to drown it out. The Affordable Care Act is showing some success from multiple measures. And, this success is in spite of the self-inflicted and opposition winds in the sails. What is not being said enough, is it could even be more successful if the remaining states expand Medicaid. In my view, the ACA is actually aiding the economy, which is contrary to opposition rhetoric. Why do I say this? With more people covered, they are using health care services more. These healthcare spends coupled with their ability to use other dollars for other goods and services is spurring the economy. So, rather beat on their chest to satisfy the extreme views, our legislators should listen to Americans and improve the ACA.

I could mention others issues, but these five areas will help us continue down a better path. Everyone’s voice needs to be heard, but I would pay attention to those are willing to listen. If someone is too busy shouting at the end, they will not hear you. Let’s govern from the middle.

Some good news for the holidays

Billy Joel’s song “We didn’t start the fire” is an accurate reference that problems exist in the world and always have. I think the key difference is with the Internet and social media age we live in, you can find bad news anywhere in the world. It even slams you in the face if your browser opens up to the news of the day. But, it is not any worse than it has been before. I don’t know if that gives people greater or less comfort. To me, the worse issue is the amount of money it takes to get elected makes politicians beholden to funders and not the issues that face their constituents. So, real issues are not addressed in the way they should be.

However, in this time of bad news first, or per my friend Barney’s favorite quote about the press, “if it bleeds, it leads,” there are a few bright spots, even in the darkest stories.

  • The state of New York has banned fracking in their state due to a report that brings into the equation the health risks that fracking poses for its residents. This caught even anti-fracking advocates by surprise with the report noting there is a correlation between health risks and fracking and it warrants further study under the Precautionary Principle, which scientists around the world uphold. This principle states if there appears to be a risk to humans or the environment which impacts humans due to a process, then the group who benefits from the process needs to convince others that it is safe before proceeding.
  • The number of uninsured folks without healthcare coverage has dropped significantly per the Robert Wood Johnson Foundation from 17.7% to 12.4% as of September 30, 2014. With the huge enrollment success underway with the Affordable Care Act, with over 2.5 million new enrollees as of December 13, this uninsured rate will drop further. This helps people and the economy as it keeps more folks from becoming a train wreck through preventive services and medications, lessens the risk of bankruptcy due to medical reasons and gives them more money to spend. And, the healthcare costs increases are moderating due in part to the Affordable Care Act per multiple sources.
  • While the war on Ebola is far from won, significant progress has been made to the extent people can get a breath of air. Also, with candidates not in election mode spreading fear about Ebola risks, it is less center stage in the US. While it is still a real threat in those countries where it started, there seems to be more concerted efforts and positive stories in the battle to contain the virus. Time Magazine hit a home run with its recognition of the Ebola Fighters as the persons of the year in 2014.
  • Beneath the bad news on ISIS and the Taliban attack that killed the children in Pakistan, the Muslim and non-Muslim worlds are beginning to see who the real danger is to their existence. It is not the US and western allies with all of our imperfections. It is extremists who take advantage of economic strife and blame others for their problems. Killing children glorifies no one. Killing women glorifies no one. Killing people who disagree with you means you fear your argument cannot stand up to debate. The counter balancing problem is the corruption in the leadership. When leaders pocket money for aid, permit bribery to be standard operating practice, and squelch dissent, then they also are as guilty for sowing the seeds of disenfranchisement.
  • For all the crap the President is taking for immigration actions and the recent action on normalizing relations with Cuba, the moves are supported by many including the US Chamber of Commerce and will enhance trade, facilitate the retention of intellectual capital and let the economy be the best goodwill ambassador. Even during the Jim Crow era, economic trade benefitted all and normalized relations to a certain extent. The economic goodwill set the stage for civil right changes. So, if we can leverage what has been done and pass supportive bills to both, getting beyond the “gotcha politics,” then these efforts can be made even more significant.

Some people may not agree with my conclusions, but I see the above as positive developments, even though some of the good news has been instigated at a horrible cost. To me, we must honor those who have died to make sure that others do not die in vain, especially our children and women who are maltreated in far too many places.

Happy holidays to all. And, bless the women and children in the world. They need our support.