Thursday, July 31, 2008

It's The Infrastructure, Stupid

170,000! There are 170,000 gas stations in the United States. Hold that thought for a minute and I’ll get back to it, and I’ll tell you why it may be the most important statistic in the entire discussion about high gasoline prices.

In 1973, before the Arab oil embargo, the average gas mileage for American cars was 12.4 MPG. Then our government took action, mandated better fuel economy from the auto makers, and by 1984 the average was 22.7 MPG—almost double what it had been only ten years previous. That was the last meaningful action from our government on this matter. The average now is 22.4 MPG, actually less than what it was a quarter century ago. Left to their own devices without government interference (the Reagan years), the automakers pushed horsepower rather than fuel economy, knowing that the consumer would always buy the most horsepower that they could afford. And the auto buyers, the consumers, took the bait and swallowed what the TV ads were pushing. Now everyone is shocked at the price of gas because they can’t afford to feed the horsepower beast in their garage. As my son would say, “Who didn’t see that coming?”

The government is blaming foreign oil, or those pesky Arab evildoers (they get blamed for everything), or environmental limits on domestic drilling, or surreptitious manipulation by unscrupulous commodity traders, or any other possible thing they can trump up to focus attention away from the automakers and the consumers. Here’s why that is. The American automakers are so anemic and pathetic that they will probably go into bankruptcy soon, and the government doesn’t want to be accused of “piling on.” And the auto buyers, the consumers, can vote, so nobody wants to offend them by telling them their buying habits are financially suicidal. Nothing gets done and everybody kicks the can down the road.

So what about alternative fuels? Have you heard of the General Motors model called the Volt? It surfaced about seven or eight years ago with a futuristic body and no propulsion system. It was promised at the time that it would run on fuel cells. Fuel cell technology was perfected in the 1960s by NASA for the Apollo trips to the moon. That whole process— perfecting the fuel cells and going to the moon— took eight years. Flash forward to now. In an identical eight years time, GM has done nothing with the Volt but show it off. NOTHING. The project has languished on the shelf at GM for so long that the once-futuristic body is now starting to look retro. It gives new meaning to the words, “empty shell.” GM spokespeople say that they are waiting for someone to develop workable fuel cells. No wonder that Toyota pushed GM out of the lead in the car market.

Remember that earlier number of 170,000 gas stations? I told you it was important, and here’s why. Those vendors only sell gas. None of them sell pure hydrogen, and fuel cells require pure hydrogen to operate. When GM says that they are waiting for someone to develop workable fuel cells, the operative word is, “workable.” GM is telling the truth. GM is waiting for someone to establish the infrastructure that will supply the hydrogen. It took most of the last 100 years to build out that petroleum-supply infrastructure of 170,000 stations. Even with a crash program like the 1960s Apollo initiative, it would take at least 20 years to have the hydrogen-supply infrastructure that GM is waiting for. And GM is content to wait. GM has no money to do anything else. Meanwhile, the next wave of American entrepreneurs who might start making their fortunes selling hydrogen— they won’t make a move until there are fuel cells cars available in quantity. It’s the classic Mexican stand-off (can I say that?).

So what should you do? Here’s my advice. Live like a European. Buy only small, light, fuel-efficient cars, preferably from Asian or European car makers, so that you’ll have a car dealer still in business ten years from now to service your vehicle. Ride a bike, if possible, for shorter trips. Make fewer trips. Walk whenever feasible. Take public transportation. And finally— this is the most important tip of all— arrange your personal finances so that you will be able to pay $7.00 per gallon for gasoline in four years. The Europeans pay more than that now, and they live quite nicely with that reality.

If this sounds un-American, then be a good American. Trust your government to solve an unsolvable problem. Wait 20 years for off-shore drilling of domestic reserves to drop the oil price 5%. Vote for whoever tells you the lies you want to hear. Reminisce about the Reagan years. Bitch about the oil companies and the commodity traders, and when you do this, try to make it sound like you know what you’re talking about. That may be hard to do. Live like a macho country-music-star-wannabe behind the wheel of your giant pickup truck, even if it drives you to the poorhouse. Who knows? General Motors might put you in their next television commercial.

Tuesday, July 29, 2008

DNCC Update— Four Weeks To Go

Move over Mr. Barnum and Mr. Bailey, the REAL circus is coming to Denver in less than four weeks. Final preparations are almost all in place. The “Tip-Of-The-Spear” Special Ops, armored commandos have thoroughly scouted downtown Denver in their black helicopters (see my blog of 6/18), and they have now retreated to some undisclosed location where they are presumably waiting for a signal that will bring them swooping in to vanquish any evildoers. Several LRADs (Long Range Acoustic Devices) are on hand to disable protestors without actually killing them (see blog of 6/11). The newest wrinkle in this local arms race is that only credentialed delegates, press, and other “official” DNCC people will be allowed to carry bottled water. The thinking here is that a water bottle in the hands of a malefactor or blackguard or other evildoer might contain urine which could be sprinkled on convention people or peacekeeping constables. Of course, as the ordinance now stands, a water bottle would also be the best defense against the LRADs and the commandos since it would make the good guys and the bad guys indistinguishable from one another.

Howard Dean came through town last weekend like a suspicious father checking out his teenage son’s cluttered bedroom for contraband. He was said to be pleased with the preparations, but with Howard Dean you can never tell what he actually thinks. Even before his visit, preparations were underway to hide the vagrants and the homeless who might tarnish the downtown Denver landscape. These unfortunates are being given free passes for public transportation, and free passes for movies and museums so they will have someplace to go. Large HD flat screens are being installed in homeless shelters to keep them indoors. You can almost feel the love.

The official expectation is that 20,000 protestors will turn out for the anti-war parade on that first Sunday of the convention week, and four days later, on Thursday, when Obama gives his acceptance speech in front of 60,000 people at the football stadium, 50,000 protestors are expected to hold a parade and rally to call attention to immigration. Denver is one-third Hispanic, so native Denverites don’t need to have their attention called to immigration. Official PR people for the DNCC say that all these numbers are inflated. But 100 years ago, Denver also hosted the Democratic National Convention. The Denver population at that time was 200,000. During the convention week, the population swelled to 300,000. And that was long before television.

What’s at stake here might very well be the future of these types of conventions. Let me explain. Given the tarnished image of the Republican brand this year, an inanimate Mexican piñata should be able to defeat the Republican candidate. And yet, the race now is neck and neck. If the Denver convention becomes the disaster that everyone is predicting— if Denver becomes 1968 Chicago—it could well cost Obama the presidency. And if that happens, both parties will need to ask themselves if these conventions are useful anymore. The primary process from January to June now selects the candidate, so the nominating process at the convention is now nothing but a show. The main thing the convention did historically was give the party nominee a big positive PR boost going into the pre-election months. But if the convention generates even more negative PR, that negates the benefit. Just ask Hubert Humphrey. Most historians now say that the 1968 Democratic convention fiasco in Chicago cost Hubert the race. Denver is shaping up as a repeat.

Monday, July 28, 2008

$4.00 Gas— Soon A Cause For Nostalgia

In 1973, just before the Arab oil embargo, we imported about 25% of our crude oil from abroad. When the automobile fuel-up lines at the gas stations reached their height that year, the politicians of the day raised their hands to the heavens like ecstatic Pentecostals and declared that they would break our dependence on foreign oil. That was then. This is now. Today, we import 70% of our crude oil from abroad. The good news is that our largest supplier of oil is Canada, still a foreign country, but not Islamic. The bad news is that we now buy far more oil from the Arab world than we did in 1973, and the scale of that monetary transfer from us to them exceeds anything previously seen in the history of the world.

Here’s what I’ve learned from some brilliant petro-geologists over the last few years at the Annual Conference on World Affairs. The world supply of oil is known with a high degree of certainty. After a century of extraordinarily sophisticated global petro-exploration, there simply are no more great undiscovered subterranean pools of oil left anywhere on the planet that can be reached with drilling techniques that would be feasible. For every oil field there is a history curve that catalogues the life of the crude petroleum supply in that particular area, and the curve has four phases to it—discovery, production, decline, and depletion. Many of the older early oil fields, like the Los Angeles basin on America’s west coast, have been depleted for nearly a half century. And every oil field has now transitioned through the discovery phase. So the reality is that every oil field on earth, still capable of delivering oil, is now in either the production phase or the decline phase. The point is this— the oil supply is running out. The only thing subject to intelligent debate is how much longer will the oil last before it’s gone? And nobody who engages in intelligent debate thinks that the oil will last another 60 years.

Meanwhile, thanks in large part to China and India, the demand for oil is growing exponentially. That says to me, “supply and demand is what moves the price up.” All the political rhetoric about oil futures speculation and hedge fund manipulation is a pure lie to make the American people believe that something can be done to lower gas prices. Government, if it had the will, could punish speculators and fund manipulators, and in so doing diminish their supposed influence on oil prices. But if Americans fully understood that our government is powerless to discover new oil fields, and powerless to force China and India to reduce their demand, then Americans would see the government for the ineffectual instrument that it is when the subject turns to oil price reduction. Here’s another thing to consider. In 2000, the Supreme Court believed that a background in the oil business was the best preparation for the Presidency, and the result was Bush and Cheney (this is partly tongue-in-cheek, but only partly). Next January, those two will probably go back into the oil business. That could explain a lot about oil pricing over the last seven years.

In a very short time, we Americans will be positively nostalgic about the good old days of $4.00 per gallon gasoline.

Wednesday, July 23, 2008

What You May Not Know About Outsourcing

Here’s the question for the day. If you managed a business and needed to hire people you could depend on to help make you successful, would you prefer someone with a poor education who demanded a high salary, or would you prefer someone with a better education who would work for a lower wage? A question similar to this was posed to me (as part of a group discussion) by John Sculley, past CEO of PepsiCo and Apple Computer.

We were sailing on the same ship together with a final destination of Bombay, India. From Bombay, my wife and I were flying back to the U.S., and Sculley was going on to Bangalore to have a firsthand look at the outsource-phone-center capital of the world. He explained that there were five reasons why American companies should outsource to India, and low wages was down at the bottom on that list. Here’s Sculley’s five reasons to outsource.

1. A better educated pool of people from which to hire. This is especially true for engineering and technical jobs since five of the six best scientific schools on earth are in India.

2. Eliminates office politics. There seems to be something in the culture of India, probably related to Hinduism, that inhibits people from the backstabbing ploys like credit stealing and rumor mongering which you see so often in the American workplace.

3. Outsourcing breaks the tyranny of the Human Resource department. (I loved this reason in particular. You’d need to have firsthand experience in an American corporation to fully appreciate this).

4. Prevents union and other organized labor problems.

5. Low wages. Scully said that this advantage is only temporary. With American wages declining and Indian wages rising rapidly, wage parity will be achieved, probably within ten years.

John Sculley was of the opinion that outsourcing to India is so beneficial to the productivity of an American company that any CEO would be remiss for not, at least, considering this option. And in his book, “The Earth is Flat,” writer and thinker, Thomas Friedman, claimed that the Intel Corporation has positioned itself to thrive for another 50 years without hiring any American workers. That’s not to say that Intel won’t hire Americans if they have the education and work ethic, but Intel is not willing to tie itself down to an all-American workforce. I know that other major corporations have a similar mind-set, even though they want to stay under the radar for PR reasons.

American patriots want you to believe that all of this is driven by the rise of China and India as economic powers. What nobody talks about is the fact that— for the first time in modern world history— the next generation of Americans will NOT be better educated than the generation previous to them. Within the developed world, the unbroken record of each generation improving on what they inherited— that record has now been broken in the United States of America. Corporation heads are not stupid. They know this and acknowledge it even if the politicians avoid it.

It’s another election year. Here’s a tip for evaluating candidates. If a politician tells us that they will keep American jobs from going overseas, he or she is delusional. And if a politician says that they will bring outsourced jobs back from overseas, they are telling you an outright lie.

Monday, July 21, 2008

No Child Left Behind-- The First Bush Failure

With the election fast approaching, I’m running out of time to pick on my favorite whipping boy, George W. Bush. So today I offer you a trip down memory lane to a time before the Patriot Act, before the Iraq invasion, before the mortgage meltdown, when crude oil was $27.00 a barrel and gas was $1.70 per gallon and the world’s glaciers were all bigger than they are now. Bush’s approval rating back then was well above 50% and it looked like he might luck out and be able to go down in history as just another mediocre president. I offer you a nostalgic look at Bush’s very first failure, that little gem called, No Child Left Behind, and we’ll answer the question, “What happens when an American President with a junior-high-school mentality decides that other people need to become smarter?”

No Child Left Behind, like all government initiatives, is laden with unnecessary complexity and written in management-speak and in-group lingo so as to make it intentionally obtuse and nearly impossible to understand. Its benchmarks are deliberately vague and ambiguous, as are its stated objectives. This makes it hard to cite its most egregious flaws, but I’ll attempt to pull out the worst of what is, overall, quite pathetic.

A school can be sanctioned if more than 40% of the students fall below the 40th percentile. When the rule makers wrote this astounding mandate, some well-intentioned statistician should have stepped forward and explained to them what constitutes a percentile. The 40th percentile of any group is, by definition, the bottom 40% of the group according to whatever is being measured. The membership or makeup of that group can change as individual people improve or slide back, but the bottom 40% will always fall below the 40th percentile. If 45% fall below that mark, then it’s no longer the 40th percentile. It’s the 45th percentile. And there will always be a bottom 40% unless the group is perfectly homogenous. Percentiles don’t exist in homogenous groups since they are a component of variation. A statistically (and mathematically) ambiguous and illogical rule like this helps explain why the students tutored under No Child Left Behind now rank #25 in the world in their mathematics proficiency. Furthermore, I personally believe that the sub-prime foreclosure mess was enabled by a deplorable lack of basic arithmetic understanding in a huge portion of our population. A math illiterate makes an easy financial victim. This stuff matters.

No Child Left Behind also measures sub-groups, like boys, or minorities, or students with IEP's (special education students) — all of whom must be tracked and shown to be improving. One of the ways, certainly not the only way, but in fact a major way that students are identified for special education is their failure to succeed. After the school follows the federal law and identifies these students as failing to succeed, then we punish the school for their failure to succeed. The sad fact is that many truly good schools have been put on the President's watch list for failure to meet all the criteria for special education student improvement. One way to game the system and improve special education scores would be to put students who scored better into the special education programs to boost the average. Wanna guess if any school has tried that? I don't know specifically if it's been done and I hope it hasn't. I suspect, however, that the schools on the watch list for failure to improve special education scores have been too diligent by only allowing truly disabled students into their programs. As a result, their standardized test score averages don't improve very much.

There’s also some sort of rule requiring schools to write goals based on standardized test scores. The goal might be something like, “The percent of 8th grade boys falling below the 40th percentile in Math will decrease in the 20XX - 20XX school year." Or "The average reading score of 4th grade girls will increase for the 20XX school year." Something specific and measurable has to be turned in to the watchdogs. However, it's not too hard to pick out from the current 4th and/or 8th grade classes an area where the students don't succeed well, and then compare that with the current 3rd and 7th grade classes to see if they typically do better. Bingo. There's your goal for next year. This I'm also sure isn't done anywhere. Wanna bet?

It’s all just a game. So let’s look at some results after six years of this Bush initiative. The overall high-school dropout rate across America is now 25%-- the highest since the Great Depression. Admittedly, that rate is artificially elevated by a 70% dropout rate in some inner-city minority student populations. Amazingly, this dropout pattern actually serves to elevate average test scores in some problem schools. Once a slow learner drops out, he or she no longer drags down the average, and by No Child Left Behind standards, things actually look better. I wonder if some young people are ever motivated to drop out because they resent being mere pawns in a heavy-handed government game plan? Seems like a reasonable possibility.

There’s another set of drop outs, however, that cripple the whole public school system. These are the good and competent educators who leave specifically because of No Child Left Behind. Anyone who has been in education for more than ten years can tell you about someone they know personally, another teacher, or in some cases even an administrator who has taken early retirement or made a career change solely to avoid putting up with the absurdity and jumping through the government hoops mandated by No Child Left Behind. It demoralizes the very people needed to make it succeed, and the hideous thing is that it seems to do this by deliberate design. The entire Bush initiative has a paternalistic, justify-your-job tone, similar to what you typically see coming from a corporate HR department when someone is being set up for termination. The implication is that everything deficient in education is the fault of the teachers and administrators.

So what about the finished product? What about the student? And what about the student’s place in America? Human resource hiring managers across America will universally tell you that an American public high school diploma is no longer sufficient for anything above a minimum wage job. That’s leaving a lot of children behind.

Saturday, July 19, 2008

Corruption In America's Pharmaceutical Industry

Take an educated guess. Which American institution (not counting the Government) employs the most lawyers? The insurance industry? Real estate? The automobile industry? The travel industry, which would include the air carriers as well as the plane manufacturers? All would be intelligent guesses, and all would be wrong. The answer is the "generic" pharmaceutical industry. The word, "generic," is used to differentiate this from the other pharmaceutical industry which is called, "research based." One employs lawyers, the other employs scientists and marketing people. One consists of drug makers with names that nobody recognizes, and the other is a list of companies like Pfizer and Merck and Johnson & Johnson.

Why so many lawyers? Because they have only one job, but it is gigantic. The generic drug lawyers are charged with breaking patents. Here's how the system works. A big research-based company like Pfizer might spend 30 billion (with a B) dollars each year on research. This work is aimed at discovering new compounds, of which about 1 in 100 eventually proves worthy of development. Of that development group, about 1 in 5 finally makes its way into the marketing machine, and then to doctors and patients. By that time, the original patent protection has been whittled down to something between 10 and 13 years before the patent expires. When the patent expires, the generic drug makers begin to sell their "knock offs" at a greatly reduced price, and the industry statistics show that about 90% of the drug usage switches from the research-based company to the generic company. In other words, the company that discovers and develops the new pharmaceutical has only about 10 to 13 years to recoup the research investment and show a profit from the sales.

The estimated 90% switch to generic label usage upon patent expiration has huge financial implications for the research-based company that holds the patent. Take the case of Pfizer's Lipitor, the largest selling drug in the world. When Lipitor gained FDA approval in 1996, it helped send Pfizer stock value into a stratospheric climb that culminated in 2001 with a price per share over $48, and this was after a three-for-one stock split. 2007 sales for Lipitor exceeded 6 billion dollars, but if the past switching pattern hold true, 90% of this could go to generics in 2010 when the patent expires. This is partly why Pfizer stock closed near $17 last week, nearly down to one third of its 2001 value.

If that's not complex enough, consider this. In addition to just the simple economics, part of the pressure driving patients to switch to generic drugs comes from the U.S. Congress and the AARP- two of America's most powerful institutions. So why should the average person care what happens to the big research-based companies? Because all our lives depend on fresh research, and not just for exotic disease cures. Bacteria constantly mutate, and because of this antibiotics lose their effectiveness over time. If drug companies don't keep pace by developing new antibiotics, we could find ourselves back in a time when simple pneumonia could be a deadly killer. Generic drug makers are not in the research business, and would be of little benefit in such a scenario.

So this cautionary tale has elements of big business, intense competition, huge profits within very limited time frames, lawyers working behind the scenes, monetary choices that effect virtually everyone, and life and death health choices that effect the entire human race. Add to that, an extraordinary complexity of operation and two sides to every issue. All of this makes the total pharmaceutical industry difficult to understand. And when people cannot easily understand something, they tend to suspect corruption. That's where the corruption issue comes into a discussion of America's pharmaceutical industry.

See also
Our Daily Meds
Don't Blame Kindler
Killing The Goose That Lays Golden Eggs

Thursday, July 17, 2008

Get Your Free Gas While It Lasts

In 1952, GM honcho, Charlie Wilson, told congress, “What’s good for General Motors is what’s good for the country.” At the time when he said this, his company was already working to eliminate passenger-carrying competition from metropolitan transit systems by buying up the urban trolley companies and transferring the rolling assets to the scrap metal yards across America. Nobody at the time ever tried to explain how this was good for the country, and Wilson’s words were widely quoted and pretty much accepted at face value. Nobody today would buy it.

Yesterday, we saw further evidence of GM’s deterioration, as if any further evidence was needed. The once-proud company eliminated dividends for shareholders, and with GM stock value at an all-time low, this was the last nail in the coffin for the unfortunate people still holding equity investment in the company. Also announced yesterday was the discontinuation of healthcare coverage for GM retirees over 65. I guess Medicare is expected to take up the slack. And, of course, the current honchos will eliminate some white-collar jobs (other than their own) to make it look like management is sharing the pain. I’ll bet GM wishes it now had all that money they spent to dismantle the trolley systems half a century ago.

Less than a year ago, TV advertisements for humongous Chevy pickup trucks were featuring macho cowboy-types at the wheel as the Chevy was pitted against Ford F-Series machines and Dodge Hemis to compare pulling power. You don’t need to be an internal combustion scientist to know that something which can tow a locomotive eats up a lot of gas. So now, with fuel prices higher than ever, General Motors has excess numbers of pickup trucks sitting around with no buyers. Their solution to this is to offer free gas for a short period of time to new buyers—the automotive equivalent of a sub-prime ARM home mortgage. And sure enough, that same kind of cost-camouflaging flim-flam that blindsided financially naïve Americans into home foreclosure now has Chevrolet-owner-wannabes taking the bait. They still want to be that macho cowboy-type at the wheel, at least until the free gas runs out. This is what passes for wise consumerism and automotive industry sales management in the 21st century. It might be good for General Motors, but not for America.

Wednesday, July 16, 2008

Latest DNCC Update-- Protestors Beware

The “Tip-Of-The-Spear” commandos finally flew out of town in their black helicopters, still insisting that their reason for visiting Denver was to prepare for a possible conflict in the global war on terror (see my blog on June 18). By now, their CPS systems are sufficiently programmed with the anticipated flash points where global terrorists might be likely to spread mischief during the Democratic convention in August. Take heart, however, for the merriment is far from over. The circus is, indeed, coming to town.

Today, the city constables working together with the Secret Service announced that the convention demonstrators will be “partitioned with double prison fences, eight feet high, and spaced eight feet apart so that people on one side cannot pass anything across the barrier” (their actual words). No mention was made of the razor Cortina wire on top of the fences, but I guess this is implied by the term, “prison fence.”

Additionally, there’s a ban on any paraphernalia that can be used to attach protestors to one another. This includes padlocks, bicycle locking chains, carabiners, ropes, pipes, cables, handcuffs, and pretty much any filament longer or stronger than a shoelace. So much for opposition unity. As if this weren’t enough, CCTV (closed circuit) surveillance cameras are reportedly being programmed with new face-recognition software that was developed by an American technology firm under a contract from China for use with their Olympic security systems. It makes you wonder why this much planning and thought wasn’t brought to bear prior to the invasion of Iraq.

Tuesday, July 15, 2008

Obamas On the Cover of the New Yorker Magazine

During my Independence Day sojourn to the nation’s heartland, I visited the Abraham Lincoln museum in Springfield, Illinois. I highly recommend this as a place of learning. One entire gallery of the spectacular museum is devoted to the political cartoons of the day that were published to attack Lincoln during his presidency, and they are unparalleled for their tastelessness, viciousness, and outright absurdity. The only lasting effect of these cartoons, lampoons, and caricatures was to make their creators and publishers look like idiots in the light of history.

I see a lesson in all this that might apply to the current uproar over the newest cover of the New Yorker magazine lampooning Barack and Michelle Obama as Muslim terrorists. The lasting effect will be to remind readers that the New Yorker editorial staff is delusional, and the magazine cartoonist is no Thomas Nast, but the whole affair should not cost Obama any votes. It’s true that there are people roaming around American streets whose peculiar religiosity has them convinced that Obama is the Antichrist. And there are many American patriots who actually believe that the United States Government keeps them safe, and for these folks, avuncular old John McCain is the iconic embodiment of that fantasy. And finally, there have always been the redneck goobers who listen to Rush Limbaugh three hours every day and think this makes them smart. None of these folks will ever vote for Obama, but not because of the cartoon magazine cover, because a New Yorker magazine is the last thing in the world that they are likely to read.

The New Yorker editors assured us that the whole thing was a parody. I believe this. But a parody is a lie, even though it’s humorous and very subtle. American elections for the last 50 years have always been fought with lies, with the best liar winning the contest. I fault the New Yorker staff for thinking that the average American can spot a subtle parody and realize it’s not the truth.

Monday, July 14, 2008

Management and "Happy Talk" Is Benching the Eagle

Just another day. Nine U.S. soldiers were killed in Afghanistan. Budweiser was sold to InBev, a European beer maker. NYC’s Chrysler Building is now totally owned by Arabs in Abu Dabi, and 20% of the NASDAQ is owned by Arabs in Dubai. Twenty years ago, news like this would have been a cause for an outright revolt against the government, but today such news hardly rates attention. I am firmly convinced that if the U.S.A. were somehow pushed back into the Stone Age, 30% of Americans would still proudly display a patriotic American flag on the wall of their cave and continue to bitch about the opposing political party.

I don’t think that the 2008 election will make any difference whatsoever in the state of the country. No matter who becomes the next president, eight years from now gas will be $7 dollars per gallon, sea level will be two feet higher, and U.S. troops will still be cannon fodder in Middle East garrisons. And American public education, healthcare coverage, and airline travel will still be the worst in the industrialized world, just like it is now.

To support my thesis about the irrelevance of the 2008 election, I offer one simple proof. Just look closely at all the political TV advertisements, and listen closely to what all the candidates are saying. All of them, including McCain and Obama, see themselves as a manager rather than a leader. They talk about their “plans” (what a joke) to solve the nation’s problems, but never ask for the shared sacrifice that will be needed to endure the unsolved problems once the plans fail. Lincoln didn’t try to manage his way through the American Civil War. He worked instead to prepare his people for the worst possible outcome, even as he hoped for the best. FDR, when faced with the Great Depression and World War II, did quite a lot of managing, but still found time to warn the American people that the road out of the quagmire would be difficult and fraught with peril. Neither Lincoln nor FDR relied exclusively on “happy talk.” But then, nobody ever accused any modern politician of being another Abraham Lincoln.

Tuesday, July 8, 2008

FEMA To The Rescue (Again)

I was told that my last posting was too long, so this will be a short one. I spent Independence Day out in the heartland, near Cedar Rapids, where everyone was effected by the flood to one extent or another. If the mood there can be expressed in one word, the word would be "frustration." Over 2,500 homes are simply gone. Not just uninhabitable, but non-existent. Last week FEMA moved in 40 trailer houses, and to hear the PR spin coming from Washington, you'd think the housing problem was totally solved.

One woman who is both homeless and unemployed (her place of work was destroyed by the flood) told me, "I actually envy the poor people in Myanmar. The government there did nothing. Nothing from a government would be a blessing. Our government moved in and made things worse for us. All we ever hear is how we can't do this or that because it's unsafe. It's not about safety. It's all about control, and forced compliance, and-- above all-- it's about giving the impression that the government knows what's best for us. And to make the situation totally ridiculous, our government scorns the leaders of Myanmar for being dictatorial. First Katrina. Now central Iowa. When everyone in America has eventually had the benefit of firsthand government emergency response, it will be the end of our democracy."

There's nothing I can add to that, except to say, "Pray for the people in central Iowa."

Sunday, July 6, 2008

It Takes More Than Democracy

There's a lot about the world that we're never told in The United States. I don't mean this in a sinister or conspiratorial way. Americans just have a rather insular focus, that's all. And there's a lot of what we ARE told that's bogus. Chief among the pieces of misinformation is the myth that the world would be some kind of utopia if only all the nations of the world were democratic.

The fact is that democracy is not rare. It's the most common form of government on earth. And about the only thing that democratic nations have in common is that they're headed by some person who beat some other person in an election. Democracy is no more sublime than that. The strength and success and splendor of the United States is not the result primarily of democracy. It's due far more to a pair of other fundamentals that originated with our Founding Fathers. They aren't codified in our Constitution, but they're so ingrained in our national function that we take them completely for granted. One is the notion that any citizen in the U.S. has a reasonable shot at owning the land that he lives on. The other is the prospect that any citizen in the U.S. can start his own business if he so chooses, and do it with a minimum of hassles. This is what's lacking in the rest of the world. I wasn't smart enough to figure this out on my own. But then I sailed around the world on a ship with guest speakers who presented on-board lectures. They pointed out what to look for, and I simply took their advice and saw with my own eyes how things operate in the countries that we visited. Here's what I found.

In Brazil and Argentina, it takes almost two years to get a license to open a business, and the fees for that license are so costly that the business takes about three years to recoup the investment. The result is that almost nobody bothers with the license. In Brazil and Argentina- in fact in South America as a whole- 50% of the GNP is black market. I don't mean this in the criminal and underworld context. It's just that half of all business conducted in South America is off the official radar screen. The businesses don't pay any tax. The government loses income as a result and can't afford any kind of business oversight or regulation, so customers interact with business at their own risk. But the real negative is that business lacks the motivation to reinvest in capital improvements because the business can be closed down by the government at any time. In South America, most of the voters are affiliated in some way with illegitimate business, so the majority voting block stays committed to the status quo. A change in leadership might mean tighter requirement for licensing or greater license enforcement. This is the essential reason why North America is rich and South America is poor even though both continents are democratic. Truth is- there are many people in South America who would be much better off living in a well-run kingdom rather than in their democracy.

Now about property ownership. I'm about to tell you more than you probably want to ever know about the slums that constitute a major part of many of the world's big cities. There is a deplorable phenomenon called, "exponential urbanization," and it's intimately tied to the inability of people to own property. We don't have anything like this in the U.S. so I'd like to paint you a word picture. I live in Denver where the municipal airport is twenty miles from the nearest edge of the city. If you have ever flown into Denver's airport, DIA, or if you've never been there, just try to imagine this. Imagine that all of the vacant land, now mostly fields of hay, between Denver and the airport is chock full of tiny shacks with roofs of corrugated tin or blue plastic cover material. Miles and miles are like this, with small irregular roads threading through the shantytowns, all unpaved and alternating between mud and dust depending on the weather. Imagine that everyone living there has to walk about ten miles to the Platte River near Brighton to fill two-gallon water jugs, and then carry the jugs back home to have a daily supply of water. No toilets, of course. And then imagine that all of these slums and shacks have been built in the last 10 to 15 years, so that the population of Metro Denver is 7 million instead of 2 million, because 5 million live in the slums. All of the land covered by slums, even including airport land between the runways, belongs to either the federal, state, or city government, or in some cases private owners who lack the clout to evict the squatters on their land. The point is, none of the land is owned by the people living on it, so nobody has any incentive to improve their dwelling beyond the status of a shack because they potentially can be booted out at any time.

Most all of these slum conditions are found in democratic countries. The squatters are a majority of the voting people, so the government in power can stay in power by raising the fear that a change in leadership might mean eviction from the government land. In 25 years, Rio de Janerio grew from 2.7 million to 14 million, Bombay went from 4 million to 23 million, and Delhi went from 4 million to 19 million. These numbers explain why the urbanization is called, "exponential." Most all of the population growth of these cities took place in the slums and shantytowns which they euphemistically call, "informal housing." And one last thing about the slums, they're a vast breeding ground for Islam. You can see the minarets poking into the sky throughout the slums because they are the only thing higher than a single story. Many more Muslims are now living in the slums of democratic nations than are living in all the Arab kingdoms and theocracies of the world, but you never hear about that.

I've described cities that I've actually visited on my global trip. I saw these places for myself. These were cities in democratic nations. Much of what I learned, I learned by a kind of simple osmosis, touching and feeling things and places that most Americans have never even heard of, and here's what I learned. The next time I hear someone tell me that spreading democracy is worth the sacrifice of American lives, I'll take that with a grain of salt, because I've learned that the world is just not that simple.

Wednesday, July 2, 2008

Vaccine and Autism

Thimerasol is the mercury-based component once used as the preservative in MMR vaccine, as well as most other human vaccines prior to 2002. Thimerasol is the part of the MMR vaccine associated with the suspected link to autism. In 1999, the FDA ordered all U.S. vaccine manufacturers to find an alternate preservative (not based on mercury or aluminum) and to phase out all use of thimerasol. By early 2002, thimerasol was gone and vaccines were mercury and aluminum-free. Since 2002, autism rates diagnosed in young children have risen, in some cases nearly doubling. Additionally, autism is being frequently diagnosed now in children who are "vaccine naive" (this is the medical term for "un-vaccinated"). So much for the MMR vaccine link to autism. The scientific principle of "cause and effect" dictates that the effect should disappear when the cause disappears. That has not happened. Therefore, there is no "cause and effect" link. End of story.

Well, not quite. There may never be an end to this story. Like the controversy over global warming, and like the eternal tug-of-war between evolution and creation, the debate about MMR vaccine and autism has now degenerated into another case of logic versus belief. And in this struggle, logic always loses because believers don't need logic to support their belief. Many people are throwing gasoline on this fire, and one of them is a woman named Katie Wright. Her father, Bob Wright, is the past chairman of NBC/Universal, and the Wright family runs the organization, Autism Speaks. This is a family with considerable influence, certainly more influence than the typical scientific investigator has. This influence could be used to help settle the debate, but sadly, the focus there is now shifting away from the science.

This would all seem like academic nonsense were it not for the fact that there are sincere people who need and deserve factual answers to the question, "Why does my loved-one suffer from autism?" They deserve better than what this debate is providing. Placing blame will never cure a case of autism, but placing blame on the wrong cause is doubly counter-productive.