Yet another letter to Senators

Please open up the government. A deal is there to be had, but it needs to not involve the person causing the shutdown. It is telling when a boss does not support his employees. To me, this speaks volumes into the nature of the US President.

Americans are being harmed. These federal employees deserve better than to be mere pawns in Trump’s game. Sadly, that is his history as a manager. Please do your job and open the government.

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Saturday in the park – once again

The rain has stopped and the sun is shining. So, we will celebrate with a nice hike in a close-by park trail. Hopefully, the trail won’t be too slushy.

Here are a few thoughts to chew on this weekend, in no particular order.

Note to expressive incoming Congressional representatives. Even though the President acts like what you call him, derogatory name-calling is not productive. It is even more true with this President who relishes mud fights simply because he does not need to know facts to win. Please stick to the issues and his actions and words.

Speaking of said man, he says he will do what it takes in shutting down the government to get his wall. Excuse me, but what sacrifices are you making Mr. President? It seems the federal workers who work under your watch are worried sick about mortgage, rent and bill payments and spending on groceries and prescriptions. What precisely are you sacrificing Mr. President?

What saddens me about the Republican Senators is they know their leader is largely untruthful and does not deal in good faith. This man screwed them over before Christmas reneging on a deal, yet again. Conservative columnist David Brooks said it best on PBS Newshour last night. If you get a deal with Donald Trump, get it in writing.

Lastly, let’s give a shout out to our newly elected Congress that looks more like America. It is indeed an exemplar of what our country should be all about. Whether people like the new Speaker or not, Nancy Pelosi is an effective leader and has a bipartisan record to prove it. She is far from perfect, but she is much closer to that paragon than another person in a place of leadership who I may have mentioned above.

Happy trails to you, until we meet again.

Capitalism and socialism coexists

On more than one occasion, I have seen letters to the editor speak of setting up beachheads in the coming election around capitalism vs. socialism. To me, this is a name-calling gimmick to persuade a voter who does not do much homework. Voters that are prone to listen to name-calling as debate will buy into this logic time and again. The irony in this debate is the United States’ economy is a blend of “fettered” capitalism with socialistic underpinnings. So, both co-exist here.

For readers in the either camp, this observation probably surprises them, especially those who are gung-ho capitalists. But, the word in quotes is also important as we do not have unfettered capitalism. If we did, the US President would have run out of money long ago with his many bankruptcies. I believe in capitalism as well, but we need to understand why we ventured down the path of the socialistic underpinnings.

These underpinnings spoke to a nation that was in a great depression and who seemingly got lost in poverty later on. Social security is a low-income weighted pension, disability and survivor benefit program that is funded equally by employers and individuals. To determine the base level benefit, 90% of average wages are used for the earlier wages then added to 32% of the next tier of wages which are added to 15% of the highest wages up to a limit.

In the 1960s, LBJ’s “War on Poverty” added Medicare and Medicaid to the mix, with Medicare helping retirees and Medicaid focusing on people in poverty. Then, we can mix equal measures of unemployment benefits, workers’ compensation and food stamps which are now called SNAP benefits. Each of these programs are forms of “social insurance” benefits. That is socialism designed to keep people fed, housed and protected.

Taking this a step further, utilities are so needed to our communities, they are either co-ops or fettered capitalistic models where rate increases must get approved by a state governing board. Companies like Duke Energy and Con-Ed must get permission before they change their rates. For the co-op model, the customers own the business.

But, the word “fettered” enters into the mix on other businesses as well. To prevent monopolies, insider trading, interlocking boards, collusion, the misuse of insider knowledge by investors, etc. rules are set up to provide governors on capitalism. Then, there is that bankruptcy thing, where a business or person can claim bankruptcy to pay debtors what they can and restart. I use the President as an example, but his experience is a good one, as he filed for bankruptcy six times on various investments.

I want people to think about our country in this context. We want people to earn their keep and be fully functioning tax paying citizens. Yet, we have programs in place to keep them out of the ditch. As we considering changes to programs, we should consider what they are accomplishing and how changes could make them more effective. And, we must understand that things must be paid for, so how do we get the best return on the investment into those stated goals?

For those that have followed my blog for some time, you know I have been involved for many years in helping homeless working families find a path back to self-sustainability. We help the homeless climb a ladder, but they climb it. Yet, we are also successful in keeping people housed on their own after two years of leaving our program because we measure things and make improvements. The ultimate goal is self-sustainability, so we measure how we can be the best financial stewards toward helping people achieve that purpose.

We need social underpinnings to help people be fed, housed and protected. Some need to be temporary in nature, while others are longer term like Medicare and Social Security. There is a cost-benefit to these equations, but we should understand that we have poverty problem in our country. We must also understand technology advances will continue to change the paradigm on employment as it has throughout the industrial age placing additional pressures to even more wage earners. Not providing ladders out of poverty or ways to avoid it would be a bad path to follow for our country.

 

Project management and execution matter

Business, philanthropy and government are littered with people with good (and not so good) ideas, but have little comprehension of how to execute them. The importance of project managers who can get those ideas to the finish line cannot be overstated.

My friend D is one of those people. My favorite story about D will reveal much about her thought process. During a major project, I was curious why she was having a multi-sectional report on our findings and recommendations produced in a haphazard fashion. She said simply we can produce the Introduction, Appendices and Sections 6, 7 and 8 as they are completed now. We will do the other sections summarizing our findings and results when they are completed.

This is a simple example as she and other project managers work with multiple entities and people to get things done. What complicates it further is people have other things to do. I describe my old kind of work as juggling while walking forward. The key is to keep walking, while trying not to drop any balls. D made this happen.

I was thinking of this today as we have leaders throwing out ideas, without any funding to get things done. Or, the solutions are inconsistent with a recognition that past funding cuts may have contributed to a problem occurring.

So, in all these kinds of organizations, ideas are important, but we need to have people that can make them happen and maintain the solution once implemented. And, they require funding.

Let me leave you with a true story. There is a neat movie called “Einstein and Eddington.” You likely have not heard of the latter, but may not know the former without his contribution. Sir Arthur Stanley Eddington, at much personal and legal risk, collaborated with a Albert Einstein, a German scientist when his government forbid it due to the Great War. What did he do? He proved Einstein’s Theory of Relativity. Einstein was the idea man, but needed someone to demonstrate through a specific effort that he was right.

Blessed are the doers and those who organize and manage their efforts. Without them, our ideas may remain as only that. And, blessed are those who realize the doers need funding.

 

 

 

Corruption may be the greatest threat we face

I have written before about the greatest long term risks facing our planet as noted by the World Economic Forum – the global water crisis and poorly reacting to climate change. I would add that population growth would pose further risk.

When I first wrote about this, a British missionary in Nigeria noted he would place corruption high on the list. Why? His reasoning is the leaders of countries throughout the world skim off the top and place friends and family in places of power to do the same. So, the majority of folks become disenfranchised as money and investment are compromised and go into the pockets of these leaders.

This disenfranchisement leads to terrorists being listened to until it is too late. It leads to leaders controlling the messaging often using people’s fears to control them. It leads to a breakdown in institutions to help people and guard against those controlling messaging.

After the missionary’s counsel and observing what has happened in the past few years, I agree that corruption is right up there with the more natural risks. A few examples might help illustrate why I fully agree with him.

South Korea has a flourishing economy with overt freedoms and investment. To the north, the North Korean people live hand-to-mouth and are the closest thing to the “1984” model we have on earth. Kim Jong Un controls everything from the messaging to the money and you dare not give the slightest hint of non-support.

Vladimir Putin is the most clever corrupt leader on the planet. He controls all messaging in Russia and actively wages cyber war adroitly using Social Media to sway pro-Russia sentiment. Some unknowing sycophants like our President praise him as a strong leader. He may be strong, but he and his oligarchy are quite wealthy at the expense of everyone else.

President Duterte of the Philippines is relatively new to the game, but his corruption leads directly to the genocide of anyone who has touched illicit drugs or openly disagree with him. The negative impact of this man on his country will continue to expose them to human rights concerns.

Corruption abounds with Erdogan in Turkey who used a failed coup (which he may have staged) to remove significant numbers of intellectuals, judges and government officials who shared opposing views. The corrupt leadership in Iraq after Saddam Hussein fell led to ostracized Sunnis allowing ISIS to take hold. Hosni Mubarak of Egypt was removed from office with US$80 billion while the average Egyptian lived on US$2 a day. President Mugabe of Zimbabwe was just removed in a coup after years of corrupt leadership and before he passed the official baton to his younger wife to do more of the same.

But, we in the western world should not pat ourselves on the back too much. We hide it better through lobbyists and funders of politicians. Make no mistake, these folks give money to curry favor. In the US, we have a billionnaire President with several billionnaires in his cabinet who rode a wave of a populist movement. This would be funny if it were not so sad. His followers need only look at the proposed Tax Reform bills that heavily help the rich in America at the expense of our future. He masks this subterfuge with bombast, lying and a sharply critical tone of dissent and the press.

The downside of all this corruption is the disenfranchised are impacted and have little voice. We are also selling out our future for the bottom lines of folks with more digits to the left of the decimal point. We must speak to corruption and not let it infiltrate further into our world and country. It impacts everything else we need to fix.

Big Issue #3 – Investing in our Infrastructure

As a very positive sign, the President-elect has emphasized the need to reinvest in our infrastructure which is in need of repair. This is consistent with the plans that his opponent had envisioned and with policies that the current President has pleaded with Congress to do. It should be noted that this bipartisan desire echoes testimony by the leaders of the US Chamber of Commerce and Labor Unions who beseeched Congress to invest more in our infrastructure, and is reinforced by former Director of Transportation Ray LaHood and former PA Governor Ed Rendell.

These investments pay huge dividends beyond the repair, upgrade or rebuilding of our deteriorated assets of roads, highway bridges, railway bridges and lines, power grids, airports, cabling, etc. These investments create jobs. This is a key reason for Labor Union leaders backing the investment.

This is how we used to invest in our country, with government investment partnering with private investment to do things private investors could not do alone or where the ROI was insufficient for one entity. This history is well captured in a book by Thomas Friedman and Michael Mandelbaum called “That Used to be Us: How America fell behind in the World it Created and How it can come back.” A new book by Jacob Hacker and Paul Pierson called “American Amnesia: How the War on Government led us to forget what made America Prosper” echoes this theme. We have forgotten what made us great.

Yet, we should not lose sight of the reluctance of Congress to part with the money because of our debt. Former Speaker of the House John Boehner greased the skids by getting some Highway Trust funding before he retired at the end of October 2015, but that is not near enough. An economist whose name escapes me said in an interview, borrowing to invest in an asset is different from borrowing to pay for operations and with interest rates so low, we are letting the ideal time pass to do this.

We should be concerned with our debt, but like corporations, while cutting in some areas are needed, we need to invest in our deteriorated assets. This is an area where some obvious funding could be created and aligned through an increase to our comparatively low gas tax. By increasing the federal gas tax by 35 cents per gallon, per the nonpartisan The Concord Coalition, it would raise $469 billion in revenue over ten years. Plus, it would provide further incentive to purchase better miles per gallon vehicles, which will help the environment.

Investing in our infrastructure is needed and we should begin discussions early in the term of our next President. It is long overdue and will get even more people back to work, especially in areas where underemployment is higher.

Example of how the media promotes conflict

In my business career, I became accustomed to the US regulatory process. Congress would pass laws and the Department of Labor (DOL), IRS, EEOC, etc. would pass regulations to administer the laws. And, they used to be reported as such. The DOL released proposed regulations today, e.g.

Now, to promote conflict, these departments are rolled up into one category – the Obama Administration. This likely started before with George W. Bush, but to me it is done to represent that the President must be extending his powers. When, in fact, it is these departments doing what they have always done, nothing more or less.

The process works usually like this. A department will propose new or revised regulations to address a new law or an outdated one. There will be a formal comment period where feedback is sought. Then, the proposed regulations will be revised and another comment period may occur. Then, the regulations will be released.

To their credit, the departments do listen to feedback. And, sometimes if the pushback is so severe, they will be pulled and redone. Back in the early 1990s, there were some regulations passed that were so-God awful (called Section 89 to regulate non-discrimination in healthcare benefits), they were pulled.

While regulations come in all shapes and sizes, I want to take the chance to mention my favorite regulations issued by the IRS. I call them the Mea Culpa regulations, but they are better known as the Voluntary Compliance Program. In essence, if an employer discovers an error in compliance, it can remedy the problem and approach the IRS with its solution. They would pay a set small fine from a menu of choices and demonstrate how they fixed the problem. Often, it would be restoring lost benefits or financial restitution to affected employees. This happens more than you would think, but it is a great example when government gets it right.

So, the next time you hear reference to the Obama administration doing something. Let’s not jump to conclusions. It may just shoddy reporting on a mundane task. Continue reading