A few more Sunday sermonettes

Happy Sunday. No, I won’t be preaching this morning, but I will be trying my best to speak a few truths.

It easy to blame someone else or some other entity for your troubles. The European Union is not perfect, but has helped many countries through hard times. When they are helpful, country leaders pat themselves on the back. When times are tough, it is nice to have a scapegoat. Relationships are hard work, but countries need to think hard if they want a divorce from the EU before they have the “what do we do now moment?”

Speaking of relationships, the man in the White House tends to have transactional ones. A pundit said he counts few friends saying he touts a “me against the world” mindset. If he keeps on ticking off our allies, this description will be very apt. Unfortunately he will drag the US down with him.

Two of the worst terms in America are RINO and DINO. They mean Republican (or Democrat) in Name Only. They are used by tribal party members as an insult to someone who is not towing the party line. As an unaffiliated voter who has been a member of both parties, I find these labels offensive. We pledge allegiance to the country, not some party. If someone uses this term, do yourself a favor and pay attention to what the target of their labeling is saying. It likely has more veracity than the claimant’s argument.

The United Nations came out with a report Friday defining how Trump’s policies are detrimental to the poor in America. America has a poverty problem that predates Trump. Too many are living paycheck to paycheck and some are even beneath that. This President and Congress’ solution is to give a huge tax break to wealthy people and companies. And, if the repeal of the Affordable Care Act went through, it would have been even worse. America has fallen in the global ranks on upward socio-economic mobility. It matters more to whom you were born than merit in getting ahead.

On a positive note, Costco raised its minimum wage from $13 to $14 an hour and Walmart increased theirs from $9 to $11 an hour. And more states and cities are making planned and new increases. These are steps in the right direction. It would have been nice for Congress to have increased the minimum wage along with the tax decrease which impacts corporations annually. It would have helped pay for some of the lost tax revenue if companies had to increase pay for those in greatest need, plus this money would be spent as they need it more than the 1% group.

Thanks for letting me preach. Any Amens or rebuttals? Other truisms?

Relationships with countries are vital

There are no perfect people, so we cannot expect perfect leaders. There are also no perfect countries, so we cannot expect perfect agreements among countries. To respond to these short-comings, we must do our best to value relationships.

This works for people as it does for countries. An ambassador noted America’s strengths are its military might and its relationships with other countries. Our relationships predate the existing leadership team, so it is imperative to nurture them. This will help us resolve problems as they arise.

This is not just a US problem where its current front man acts rashly and chaotically, breaks commitments and agreements and lies more than he does not. He has made America less trustworthy and other countries are finding a need to seek better agreements with others that do not include the US.

The imperfect European Union is experiencing significant tension with the pending Brexit, the current difficulties in Italy and the growing nationalistic movements in EU countries. This is made worse by targeted social media efforts by countries that would benefit from a dysfunctional EU and US. Russia is one of those countries and they have been accused of such targeting.

A key part of these relationships is a financial one. The global economy is larger than it otherwise would be due to these relationships. If each country only tried to maximize its own profits in a zero-sum effort, the total pie is smaller and we all lose. This concept is called the Nash Equilibrium, which won John Nash a Nobel Prize in Economics.

Yet, it is more than that. These relationships make the world more secure and safe. The nationalists argue the opposite, but the more commerce is intertwined, leaders work harder to nourish those relationships. A strong EU makes Europe safer and prosperous. A strong relationship with the US and other countries does the same.

Yet, these agreements are imperfect. Not every citizen within a country may benefit equally from a global economy. There is a graph called the “Elephant Curve,” which is a silhouette of an elephant with its trunk raised. The body forms the rampant growth in income of the poorest workers around the world, while the trunk represents the even more significant growth in the highest income earners. The trough inbetween represents the middle income earners who are seeing stagnant incomes, who are in more flourishing economies. This trough has led to populist politicians who over-simplify the problems and come to short-sighted solutions.

Their needs must be addressed, but first we must understand the causes are more than the global economy. The larger threat is techonology advancements. Through our relationships we must invest together on addressing these issues. If we do not, we will create zero-sum contrasts, that will cause even more tension. The rise of fascism in Germany evolved out of dire economic circumstances after WWI.

This last example should inform us of why working collectively is so important. We must value our relationships and make them as beneficial as possible. Going it alone may seem like a good idea to some, but we need to think through the benefit of trade and mutual investment in each other.

If this concept sounds theoretical, let me explain it better by BMW, Mercedes, Hyundai, Toyota and Nissan making cars in America, with GM and Ford making cars around the world. And, Chrysler is owned by Fiat, an Italian company. Jobs are created as we invest in each other’s countries. This is true for other industries and suppliers. And, we may be less inclined to create war, when so much is invested in each other.

Erecting barriers does not make the world safer

Our new President has been in office less than two months and the world is a less safe place than it was before his tenure. So, is the United States, which is the opposite result of his stated goal.

Erecting barriers, both physically and verbally, perpetuates a we/ they culture. Demonizing groups of people and specific individuals causes disenfranchisement. Banning folks creates segregation and less integration of thoughts, cultures and ideas. Tolerating and fueling bigotry promotes narrow-minded thinking and less collaboration. And, a jingoistic national bent derails international commerce and security.

But, this is not just a US phenomenon. Like-minded folks in other countries are demonizing people who look and worship differently than they do. I recognize fully there are concerns and conflicts with influx of refugees. Yet, demonizing folks does not help resolve the issues. The resulting nationalistic thinking makes collaboration and trade more difficult, as well as finding ways to resolve problems.

Breaking down barriers makes us safer. The more commerce we do across borders, the more indebted we are to each other’s success. The more commerce and common goals makes us more secure. The greatest threat to terrorists is multi-cultural success and freedoms.

And, as I wrote recently, coexisting leads to more profits. So, we should reduce barriers not erect them. We should challenge bigotry and exclusion. We should ask the same of our leaders.

Tuesday afternoon

As I think of the fabulous Moody Blues’ song, let me share a few random musings on this cloudy Tuesday. Technically, it is morning here, but since Greenwich time is five hours ahead, the title has merit.

If we look at the US presidential election, what are the signals telling us? The Democrat candidate is being supported by major party leadership, some of whom are on the campaign trail. Senator Elizabeth Warren, who scares Republicans because of her history of fighting for those who have been screwed over, has joined with Hillary Clinton to advocate the message of helping the middle class and those in need with actual programs. There is no better advocate for the disenfranchised than Warren.

On the flip side, the Republican candidate has leaders bailing on him and hiding when he says his latest inane thing. Conservative columnist Michael Gerson has been against Donald Trump and what he represents from the outset and George Will just left the party because of Trump’s presumptive nomination. And, no living president supports his candidacy with the only foreign leaders who have advocated for him are Vladimir Putin and Kim Jong Un.

In Scotland, Trump noted what a good thing Brexit is, yet the financial markets, debt downgrading, and the lowest pound in over 30 years are giving many pause. Plus, he said this in Scotland who voted to remain and have started plans for another referendum to leave the UK and stay in the EU. This is supposed to be the candidate with the best business acumen, but yet again he shows little grasp of the issues, even financial ones. What the Remain camp failed to explain is the number of jobs created in the UK by being in the EU, with companies who have placed their European headquarters and plants there to have duty-free access to Europe.

The US Supreme Court handed down several important verdicts this week. The first one was a tie, but left standing a lower court ruling that President Obama went a bridge too far on his immigration executive orders after Congress failed to act for so long. Next, Affirmative Action was upheld in a Texas lawsuit that argued college admissions could no longer use race to determine acceptances of applicants. The Supreme Court said the colleges could continue to use race as a factor. A lesser publicized ruling noted that people who had been convicted of domestic violence crimes could be denied access to gun purchases in a state that said it was illegal. The court upheld Maine’s right to deny gun access.

But, the biggest ruling was against Texas 5 to 3 that overturned a lower court ruling on abortion clinic access. The Supreme Court ruled that what Texas did, which was use arguments for women’s health as a ruse to close down too many clinics. The data and examples of other less safe procedures that were allowed to go on in clinics revealed a purposeful attempt to severely limit women access. This was a huge win for women’s rights on allowing what to do with her body. Experts have noted this is the most important ruling on women’s right to abortion since 1992.

That is all for now. Have a great Tuesday.

 

 

We are pulling for you, but you have an uphill climb

When a good friend does something that you suggested he or she not do as it is fraught with peril, you are concerned, but still care for them and pull for them. This is especially true when, as an outsider, you can see more clearly the troubles with a decision to do something. It gives you a sick feeling, but you will do your best to help them soldier on.

That is how many feel about our friends in the UK with Brexit, a vote to leave the European Union. I recognize the EU is imperfect like any government entity and needs improvements, but the global construct is more beneficial than it is not, due to more trade and freedom of movement. Working collaboratively, also helps lessen the risk of national turmoil which can cause unhealthy behaviors.

The global financial markets have shown an immediate displeasure with the change with significant declines and the pound priced at a 35 year low. Watching BBC World News America and PBS Newshour, where many global financial and political experts spoke, the sense is this is not just a short term aberration and that the Brexit will cause more long term financial anguish. Plus, with Scotland poised to initiate another referendum to leave the UK, this time to rejoin the EU, coupled with Northern Ireland considering the same, this does not look promising. June 23, 2016 may be remembered as the beginning of the end of the current UK construct.

All of this is unfortunate. Clearly, the UK citizens have a right to decide on their own country. Yet, in addition to Scottish and Northern Irish voters wanting to remain, the people under the age of 35 clearly wanted to remain, as they see the continued job opportunities with a solid EU. So, this is not a universally appreciated decision. What these folks see is non-UK companies setting up headquarters in the UK for their Europe business. With this change, my guess is some will consider relocating those to the Republic of Ireland or on the main continent. London’s loss may be Dublin, Paris or Frankfurt’s gain.

The UK will soldier on and the US will continue to support it. We will pull for you, but the climb is now more uphill. We should be reducing barriers to trade, not erecting them. No one is relishing redoing trade agreements with all of these entities. The uncertainty created just by this process alone will cause issues. Plus, it adds the uncertainty of other EU countries following suit. The more disruption, the harder trade becomes and creates opportunities for unhealthy nationalism.

The EU does need to do a better job of governance. The EU does need to do a better job of allowing the pipe on immigrants to be tightened and loosened dependent on the labor demands of an individual  country. These are fixable problems, but they need to be worked at collectively and with due consideration of one’s country’s labor market. Leaving the EU makes everything a little bit harder to accomplish.

I know the “Leave” voters are happy, but the rest of the world is saddened (with some exceptions), that the vote to remain was defeated. And, that is unfortunate. It would be my sincere hope is that the next few months will allow the UK to reconsider its decision and proceed with a new vote. This may be precipitated by a need to ward off Scottish and Northern Irish votes to leave the UK.