Pro Commerce

Skiing in San Francisco

I saw the ski jumping yesterday on Fillmore Street. It was exciting, with a few spills and a cheering audience. A big crowd, as big as could fit in the area and still see the jumps. 

How this happened in stodgy, romantic San Francisco I don’t know. But events do seem to get through the bureaucracy. Most of the exciting ones don’t bother. This one had to in order to block four streets for a day and a half.

The crowd was so thick I noticed a new problem for urban events. Dogs on leashes create havoc with tight-crowded-people flow. The dogs and leashes are like a police barrier --- hard to get around.

Terrorists and anti-terrorists take note: I first noticed this at the anniversary event for the Golden Gate Bridge where so many people were on the bridge that it flattened out. People brought bicycles. The bicycles made people flow impossible. Ten bicycles would block the flow of ten thousand people. In a panic, ten bicycles would kill thousands who couldn’t move. Dogs on leases couldn’t be as dangerous because the dogs would be trampled.

Dogs are the new urban children. We are going to have to start thinking about the unique problems they bring.

What is money?

My friend Hans Deuel raised the question on his blog ‘what is money’ in reference to a debate he saw on another blog.

I wrote an book on money, The Seven Laws of Money in 1973 and published it in 1974. It has sold very well to this day and I have received thousands of compliments and comments. No one has ever suggested that they could debate the subject with me --- which I would love. There has never been a book even close to the subject in twenty-six years. Suze Orman wrote The Laws of Money (5 of them) but it is not really on the same subject.

Back in 1988 I wrote an article on the subject of 'what is money' for the sophisticated reader, fifteen years after The Seven Laws. It is now sixteen years since I wrote the article, called Money Language, (in a book called DisCourses) and I have never received even one comment on it. So --- today I put it on the web in a pdf file (400k). If you’ve ever given the subject serious thought, you might find the article interesting. Simple English, difficult to comprehend, but interesting.

My pain

It pains me to announce that I have detected a change in national mood.

Please don't blame the messenger. After Katrina (New Orleans Hurricane) there was definitely a sense that our national government didn't work very well.  That was a palpable mood.

We are now getting a strong reaction to that mood.  Americans are now uncomfortable; they feel that an injustice was done to them.  The injustice was blaming the problems of a hurricane on American racism. Nearly every black leader and many prominent Lefties publicly claimed they saw racism at the root of the New Orleans problems. Many singled out the president for blame.

The injustice Americans are feeling comes from learning that the mayor of New Orleans is black and incompetent, the police chief is black and incompetent -- hundreds of his officers deserted in the face of danger.  The media added to the injustice by claiming black on black rape, looting and pillage and blaming that on inadequate government.

About 1993 there was a dramatic American mood change; that time it was against affirmative action programs.  Today (the end of Sept 2005) there is a sense that the black community is creating their own problems and blaming whites for their plight.

I've phoned friends in other parts of the country and my perception is not unique to me.

I'm sorry to see this mood and equally sorry to be the one who reports it.  I have spent fifty years of my life fighting Jim Crow and its legacy.

Economic data

I constantly have people tell me what terrible condition the American economy is in.

I am sympathetic.  No newspaper or magazine even makes an attempt to explain the economy to its readers.

I will give my readers the two key references and the necessary explanation that goes with them.  I will also write a blog on the two largest pieces of ignorance I have to confront weekly: the national debt and the balance of payments.

The first treasure....

Wall Street Journal

I couldn’t be happier with the Wall Street Journal. Their new Saturday home delivered paper is a masterpiece. I love it. The articles on managers, the focus on specific topics of the week and the wide range of business thinking are a sheer pleasure to read.

Now the Monday edition has risen to the masterpiece level of journalism. Section C is filled with business and financial analysis. Today there was a piece that showed the total value of stocks in various sectors and the size of the largest company in the sector.

The pattern shows that only in the Oil and Gas sector is the largest player close to 25% of the financial market. Even Microsoft, Wal-Mart and GE, giants in their field are below 25% of their markets.

The most important point to keep in mind, because it bodes ill for long term economic well being is that Health Care is roughly the same part of our financial world as Technology. Both are much larger than everything else including Manufacturing and related services.

Cigar door

Two photos from San Francisco are interesting. The one on the right is a pair of doors to an apartment building on Stockton Street in North Beach. The doors are truly beautiful with their cigar box graphics. (Click to enlarge.)

The second on the left is an S.F. Examiner street box where we get our daily free Examiner. I’ve looked carefully at many boxes with many different papers and publications in them. The Examiner is getting the most political graffiti and political stickers pasted on it. It seems to me that the Lefties have figured out that the Examiner has far more readers in San Francisco than the Chronicle (double the number) and is becoming much more influential with its tables, charts, original research on local issues and politically moderate editorial position. They appear to hate it, and target the Examiner for their puerile propaganda.

Super-size me?

Just so you have the reference to the simplest put down of the stupidity of the anti-commerce crowd it is here. The Super-size me movie made the point that eating three meals a day at MacDonald’s for a month will make you fat and sick.

So Merab Morgan ate at MacDonald’s every day for three months and lost 37 pounds. One intelligent, determined woman, without a film crew and without a bucket of ideological stupidity made a fool of the entire anti-commerce crowd.

Clarity on the 1969 parades

Historians of the 1960-70’s have gotten their material completely wrong. Yesterday in San Francisco we got to see history clarified.

What happened yesterday? We had two parades in different parts of the San Francisco. One parade, the Love Parade, had 24 floats, 200 DJs from around the world, lots of happy people and plenty of nudity. The crowd reached Civic Center and filled it up. That puts the number at 50-60,000 fun loving, dancing celebrants. The Love Parade derives from the first Love Parade in 1989 in Berlin celebrating the end of communism, hatred, ideological poison and the whole sick package of the socialist Left.

The other parade in San Francisco was the anti-war politicos. Plenty of hate Bush signs, speeches attacking everything imaginable and always attacking the United States, capitalism and imperialism. The 300,000 ghosts of Saddam’s murdered Iraqis marched above the uncaring mass of oblivious protestors. Less than 20,000 protestors (15 ghosts per person) straggled and shouted their obscenities and hatred, barely filling a small park in a black neighborhood.

Think about the two marches together.  That is precisely what happened in the San Francisco anti-war marches of 1969, which I attended. About one-fourth of the marchers were politicos against the war and three-fourths were in the parade for fun, dancing, drugs, sex and the excitement of a happy crowd.

Back in 1969, both groups were together in one parade and outsiders misread the large size of the crowd to be 100% anti-war.

Straw man

I met a reader of this blog in Salt Lake City. The immediate question I had was about disagreements he has with my blog.  A lovely man who put his criticism politely: 'you often create a straw man in the Lefty position you attack.' He had my latest blog in mind.

I re-read the blog and I don't find a straw man.  I think my Salt Lake City reader refers to my statement that the current Left believe “(3) Socialism remains a major and vital force in the world to help the poor, downtrodden and helpless. It is morally superior to commerce.”   

This Lefty position is not a straw man, it is widespread in spite of the unmitigated victory of commerce over central planning and income redistribution in the Cold War.

The proposal to give $ billions to poor countries to eliminate poverty was accepted overwhelmingly at the U.N. as proposed by Jeffrey Sachs.  The EU supports Sach's proposal and the 'pour money on the poor' proposal was a keystone in Tony Blair's demands at the most recent G-8 conference. The same proposal was promoted extensively, with complete support, at the recent Bill Clinton Congress of His Global Friends and Former Cronies.  If giving money to the poor to alleviate poverty isn't a socialist idea what is it (it isn't a commercial idea)?  Didn't Bill Clinton learn from the welfare reform act he signed in 1996 that dramatically shrank the poverty roles ?

This is not a straw man I have created.  This is core Lefty thinking and has been for 150 years.

Lost the Cold War

We may have lost the Cold War.  The Cold War was fought for nearly fifty years and the issue was whether a commercial society could provide a more appealing life than a centrally planned society.  When the walls containing the subjects of the centrally planned society came down … the war was ostensibly over and commerce had won. 

In the fifteen years since the end of the Cold War there has been some minor global change in the interpretation of the Cold War issues (mostly in New Zealand, Israel and Denmark.) Many of the formerly subjugated countries have renounced their forced conversion to Soviet central planning. 

Most significant is that domestically, in the U.S, we have not changed our views. The Left .....

L.U.G

This blog is about public opinion surveys.

Most public opinion surveys are like research on nutrition or health.  They are inherently contradictory and there will soon be a more recent publication to contradict the latest findings.

I read that a recent survey by the CDC shows women in the 18-25 age group have gone from some lower number up to 14% who have had a lesbian experience.  Men report a much lower number of same sex relations.  From my personal experience and countless earlier studies, the number is much higher for both groups if experience starting at age 10 is included in the survey data.  But that is irrelevant.

I think there has probably been an explosion in lesbian relations among women in the 18-25 age group for one reason:.....

Hippy dids and didn'ts

I went to a hippy revival party and wore my Israeli Defense Forces t-shirt and my George W. Bush White House cap.  Both were intended to provoke conversation to point out that some people from the hippy era are not brain dead and stuck in 1971.  I only got a few conversations, most hippies are afraid to have high intensity dialogs. “Peace, brother.”

This is a good time to summarize the great contributions that hippies made to American life and to some extent the world. There were also failures that didn't go very far.

Successes: music, the revolution in....

Airline bankruptcy

I keep reading all the brilliant minds and soothing know-it-alls telling us what is wrong with the airline industry, as two more airlines turn to the bankruptcy court.

I have an answer and I’ve tried to find a bankruptcy lawyer who will help me act as an intervener in an airline bankruptcy case. If you know such a person, who will talk to and work with an ordinary human being for less than $1 million, please let me know.

The problem with every airline company is that it is in two different businesses with two different goals. First it is an industrial company with the sole object of lowering costs, second it is a clientric company with the goal of lifetime relations with its clients.

Solution: divide the company into two companies that contract with each other. One company provides the gates and airplanes; a purely industrial operation with the goal of minimizing costs. The other company does the marketing, customer relations and customer service on the ground; a clientric company that aims for a lifetime relationship with the customer. Both parts of the company will have clear goals and reasonable profitability under all circumstances.

Good business debate

The current issue of Reason has a debate about corporate social responsibility (I will post the link next month when it is available.) The debate is between Milton Friedman, John Mackey CEO of Whole Foods and T. J. Rodgers CEO of Cypress Semiconductor. (Disclaimer: I was a key founder of the corporate social responsibility movement but no longer hold my original views.)

The debate is exciting and fascinating for me. As I read each position I was convinced.

Free will

This is a strange subject for a blog about commerce. It will take a few paragraphs to get to the point. Patience please.

Regular readers already know that I have been reading Leszek Kolakowski. I’ve read three of his books … no particular one is best. He is an important philosopher because he studied Marx deeply in Poland, gained fame for his scholarship, figured out Marx was a terrible sham, was driven out of his home country and had to move to the U. of Chicago and the U.S. I enjoy his scholarship on the philosophy of the Dutch Enlightenment (1630-1685) that includes Baruch Spinoza. Holland of that period is the wellspring of modern democracy and industrial commerce.

Free will comes up for two reasons. Spinoza pointed out....

Commerce, commerce

"Commerce, commerce" is the title of this entry because Google has a new blog search service that stinks. A disclaimer: I own Google stock. Yet, from the evidence, the Google engineers are not as competent as the self-serving reputation they have claimed for themselves.

If you go to the new Google blog search and check out which blogs focus on commerce you will find that this blog site headlined “Gods of Commerce, I love commerce. Commerce and …” is far down the list. Yesterday it was 41 today 27 and none of the citations above it were blog sites concerned with commerce.

It is clear that the Google engineers have excluded blog titles from their search. Not smart in my book.

Food cost

This title is intended to evoke two thoughts.

First I have reached my target weight in Weight Watchers after seven months. What I have learned is that I need to be a Homo Economicus about food. Homo Economicus is constantly weighing the price of all goods in the market against each other and against his/her spending money.

For most of us who didn't gain weight until we passed 40, we could eat all we wanted, the money price was irrelevant.

What Weight Watchers has taught me is that I have a daily spending budget of 1,500 calories.  Above that I gain weight, below it I lose. Weight Watchers has given me a handful of tools to measure and control my caloric spending.  First are all the chemical miracles of modern life: spray butter that tastes like butter, countless non-fat salad dressings that taste great and low calorie tapioca pudding. Second are handy measures.  Most skinless, fat-less roasted or baked meats are 200 calories for a palm sized amount.  The same is true for most cupfulls of cooked grains.  Nearly all fruit and veggies are insignificant in calories.

The main thing is that I have 1,500 calories to spend and I now have to chose carefully.  Sometimes I prefer a peanut butter and jelly sandwich to a baked potato at the same number of calories.  I constantly weigh my choices just as I would buying electronic goods costing $100.

The second thought I want to evoke is that every demographic group is gaining weight except for yuppies, because going over their caloric count violates their yuppie life goals. That suggests that the cost of food has somehow become so low for everyone that food is being treated as a free good and consequently abused. Cost of food 'low'/ 'free good'-- are hard to measure terms.

Just a thought. I haven't figured out how to test the thesis.

China

I sent an article from the Wall Street Journal to several friends. The title on the front page is: Secret Weapon Inside Pentagon, A Scholar Shapes Views of China -- Beijing, Mr. Pillsbury Says, Sees U.S. as Military Foe; An Optimist Turns Gloomy His Direct Line to Top Aides (September 8.)

The title says it all.  I've been looking for the expert who is shaping our foreign policy.  The fact that Michael Pillsbury says 'it is nearly impossible to understand how another culture thinks' is proof of his insight and the fact that he came to an understanding of China late in his life based on much personal experience is a sign of wisdom.

I got an interesting and powerful response from Michael Turner in Tokyo. It is the first comment. 

I also note a comment recently by Peter Huber quoting Henry Kissinger that we should not fear China's economic growth: 'China is running in place -- China needs 9% growth to compensate for its loss of 7% due to declining government industries.'

Three paths to happiness

There are three paths to happiness for my readers. One is to buy the September Commentary ($4.50), the second is to buy the Joshua Muravchik article (Among Arab Reformers) online ($4.95) and the third is to get it at the library.

Muravchik is a Jewish neo-conservative who went to Palestine for a four-day conference on democracy in March and lived to report on it. He found all the makings and excitement of a flourishing democratic movement. It will warm your heart to read about it, if you appreciate what  George Bush has done.

Muravchik also went to Egypt and found a similar vitality in the democracy movement there, with the stipulation that a police state is still in place. The only negative he reports is that peace with Israel is not an allowable public discussion issue in either place.

The good news is that the Bush doctrine (some call it the Bush-Sharansky policy) in the Middle East is working. Democracy has raised its head and seems to be alive. This could make George W. Bush the greatest president in U.S. history as history plays out.

The Bush doctrine only posits peace with Israel after democracy has been created in Palestine.

Looking back

The photo on the right is the entrance to the elevator in what was the Bank of America headquarters when I first worked there. The elevators and the entry atrium have been kept the same. The building is now filled with legal and accounting offices. 

I took this very same elevator to meetings with top Bank of America management when I made presentations or worked on management committees.

I challenged myself to recreate my worldview from those days. Could I see the world with my twenty-five year old eyes?

The answer was immediately and correctly 'no'.....

Bad policy also fails

In California we have many local ordinances that require large builders to set aside units or money for housing for people with low incomes.  It is politically called “affordable housing” and technically called  “inclusionary zoning.”

This has been around for thirty years and is bad policy.  What is happening is that Lefty local politicians know that the public considers “affordable housing” to be a desirable public goal. But they also know that the public would never vote for increased taxes to pay for it. So these contemptible public officials have create a specific tax on new construction that can only be used for one specific policy purpose.  It is a single purpose tax --- which is always bad.  The auto companies have given us a single purpose tax on gasoline that can only be used to build highways.  Single purpose taxes are always self-serving bad policy.

I turns out that this “affordable housing” tax also fails to do what it intends to do.

Benjamin Powell and Edward Stringham have published a paper studying inclusionary zoning over a 30 year period and found that it produced virtually no housing --- a few dozen units per county.  I read the paper and it is simple and accurate.  In a few pure cases Powell and Stringham were able to find that inclusionary zoning completely stopped new housing construction, so housing prices just kept rising and becoming less affordable.

It is time to get rid of this piece of bad policy that doesn't work. 

Apple offspring

There is a traditional phrase “the apple never falls far from the tree.”  This was likely a Viking expression because it is found in English, German and Russian writing from several centuries ago.  It has long meant that families produce on-going like products.  It has occasionally been meant as a criticism of a man when his offspring is unpopular or has some negative qualities.

I want to use the phrase in praise of commerce....

Parenthesis

Turns out there were some major events that are like parenthesis in my life.

Beginning parens: The Summer I arrived at the University of Chicago at age 15, was two months after the first improvisational theater was developed. I didn’t know that. Improv has been a big and joyful influence in my life. Every time I get an unsolicited phone call I use the opportunity to practice my improv. I had previously given Keith Johnstone credit for creating improv. I took a class from him many decades ago.

Ending parens: The last year I was at Chicago I had a dramatic experience with my girl friend who got kicked out of her Catholic family home and had to stay in my apartment with me and my roommate. The next semester my roommate passed on the story to his new roommate, a grad student in English, Philip Roth. The story of my girl friend and I became the lead story in Roth’s first book Goodbye Columbus.

Listen to the Left

If you want to make money, listen to the Left.

This is a report on the progress of my anti-PC portfolio. This portfolio is made up of the American corporations the Left hates most: McDonald’s, Wal-Mart, Halliburton, Citicorp, Microsoft and Starbucks.

I started the portfolio January 1^st 2004. Today it is 30.1% higher, excluding dividends. For comparison, the Dow Jones Industrial Index is up only 1.2%.

 So listen to what the Lefties hate and invest in it. Lefties have an unerring sense of what other people love and what they consequently want to destroy.

Three good ones

There are three articles my readers will consider worthwhile reading, if they haven’t already read them. I put two of them online so they will be free for interested intellectuals doing research in our domain.

The first, Joel Kotkin describes the history of city disasters....

Roberts’ roast

I’m looking forward to seeing John Roberts roasted by Democrats on the Senate Judiciary committee.

We have a political dynamic that works perfectly. The Democrats get a chance to satisfy the loyalty of their most highly partisan supporters and funders. All they risk offending are groups that don’t matter to them and one person.

The great thing, from my perspective, is the one person they offend will be approved for the Supreme Court a body made up of only nine people who serve for life. Roberts could be joining a couple of other anti-Democrat justices who may outlive me.

If the lynching of Justice Thomas is any lesson, a roasting of Justice Roberts will last a long time. Thomas still talks about his lynching and it still hurts him. He never forgets it when he votes and writes opinions. With any luck and reasonable short sightedness on the part of the Senate Democrats, Justice Roberts could remember his roasting for many decades to come. A good Roberts’ roast could mean an anti-Democrat in a powerful position for life.

Simple Living Awards

It was a fun night as everyone would expect.  Simple Living awards buffet dinner and dessert. Forty people came including three emerita winners.

The emerita winners of the Simple Living award were Charlie Starbuck, a bicycle fanatic and freelance environmental worker who has always done the gritty office and field work for food banks, urban forest projects and native restoration plantings; Zack Stewart, an environmental architect who was wearing his monthly Muni bus pass as a badge of honor; and Roger Pritchard, an investment banker who teaches people how to use their investment portfolios for a simple life. All three were wearing their award medallions and told stories of how important the honor had been.

Missing emerita winners....

Possible miracle

Two elections in September, Japan and Germany, could contribute to the longest business cycle boom in global history.

Both elections portend economic reform in the second and third largest economies.  In Japan, Koizumi will be able to free up $ trillions for private investment to boost the economy if he wins big.  In Germany, Merkel has promised to significantly reduce the  bondage banks and labor unions hold over large corporations.

The U.S. is in the fifth year of an extraordinary period of business cycle expansion, easily the longest business cycle boom in our history.  This boom will be extended if Japan and Germany come online to support global production with investment and GDP growth.