Sheep and Goats

Category: Business

  • Rationalism, the Third World, and Bible Principles

    At first it appeared the countries suffering the most would be the "guilty" countries – the ones whose banks invented the super leveraged credit default swaps and collateralized debt obligations – the ones whose governments and citizens were head over heals in debt – the ones whose people had replaced the Bible with Consumer Reports. "Responsible" countries, those operating a surplus, whose citizens were frugal, such as China, Japan, and Germany – would emerge relatively unscathed. Ah, but it was not to be! The latter countries have suffered as much or more. Their strong balance sheet comes from exports, and now who remains to buy their goods?

    But the really innocent countries – the third world countries – fare the worst by far. There, the downturn doesn't mean tarnished golden years. It means lives lost. Seldom are cause and effect linked so clearly – most often there is sufficient disconnect so that the connivers on top can remain oblivious to the havoc they wreak below. But not this time.

    Economist this week considers the plight of Africa, (The Toxins Trickle Downward, 3/14/09) where in recent years, millions have inched their way above the poverty line, only to be shoved firmly beneath it again. Such countries are impacted in three ways: 1) credit market are closed to them, as they are riskier borrowers, and financial aid from wealthier countries wither, 2) commodity prices have collapsed, and commodities are usually their primary exports, and 3) remittances from citizens working abroad have dried up. The World Bank reckons these three factors will account for 200,000 – 400,000 lives lost, all children.

    It's rare that the failure of human rule is shown in such stark relief, with consequences so directly traceable. How damnnable that people nonetheless prefer it to God's rulership as outlined in the Bible, as advertised by his Witnesses, and as practiced by the Christian organization. Here's an excerpt from someone who has left God – our God, no less – Jehovah, to embrace atheism. He gushes effusively about his new "rational worldview" (I have greatly condensed certain remarks, and to be fair, you might want to see them in their context here. The author includes a number of his gripes about Jehovah's Witnesses – mostly exaggerated drivel, in my view, that I may respond to if asked – likely in a separate post.):

     

    Rationalism for me means a life of pure freedom. ….. But this means that this life that you’re living now is the most precious thing you’ll ever have. …. Because there is no Big Daddy to appease or suck up to, or be afraid of, you should be nice to people because it’s nice! You should treat people like you want to be treated! You should not steal or murder because it hurts people, and hurting people is wrong. Always. No one needs a god to tell them this…..

    Being a rationalist….If you say something irrational or realise the error in your own thoughts, a red flag immediately raises. …..rationalism is a worldview with no drawbacks, and only positives. It encourages honesty and truth…..It promotes interest in the common good…

     

    How lofty and soaring the words sound! How much crap they are in reality! As the "African" example shows, people use their "pure freedom," to grind others into the dirt, and not to "treat people like you want to be treated!" (an exclamation mark, no less….oh, the joys of rationalism!) They are not "nice to people." They "hurt people," two to four hundred thousand of them, even though "hurting people is wrong." Plainly, we do need a "big Daddy to appease" and a "god to tell" us how to live.

    If you had had a son or daughter high up in the banking world, who was devising the complex financial instruments that would ultimately ruin us all, you would have carried on about how well junior was doing for himself, how respected he was in the business world, and so forth. Even experts in the field had not a clue they were playing with dynamite; if they had, they would have cashed out their investments before the markets plunged.

    The fact is that humans were not designed to rule themselves. It's an ability they do not have. Whether through greed, ignorance, pride, or some mix of the three, the record of human rule aptly illustrates Jeremiah's words:

    I well know, O Jehovah, that to earthling man his way does not belong. It does not belong to man who is walking even to direct his step   Jer 10:23

    A major theme of the Bible is that God has designed rulership which will one day replace human rule. He will bring it about himself, and those who have sided with him will be mere bystanders. In the meantime, these latter ones declare this government by God:

    And this good news of the kingdom will be preached in all the inhabited earth for a witness to all the nations; and then the end will come.    (Matt 24:14)

    Today, the organization of Jehovah's Witnesses govern their affairs in accord with Bible principles, which provides a hopeful foregleam of life under that Kingdom rule. It's well known that racial and tribal divisions – the ones tearing apart the world – utterly fail to divide Jehovah's Witnesses. It's well known that when natural disaster strikes, (for example, Katrina) teams of volunteers promptly care for their own, rebuilding homes while governments are yet twiddling their thumbs. It's well known that Kingdom Halls in the third world are often the most impressive building in town, far more than what the locals could afford – due to a sharing of resources and building talent from wealthier countries.

    All this provided through an organization which counsels, which directs, which disciplines its own, which insists on members living by Bible principles. Grousers, such as one may find online, launch blistering attacks at this, for it seems to impede their freedom, and this they will not tolerate, even in trivial matters. But our "economy" works to the good of third world countries, rather than trampling them underfoot.

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    Tom Irregardless and Me     No Fake News but Plenty of Hogwash

  • Alan Greenspan and the Financial Black Hole

    As the Large Hadron Collider in Geneva was about to become operational, dire warnings appeared on the internet. Scientists had been salivating about their Collider for the longest time. At last they’d be able to simulate conditions from the Big Bang and learn…..well, all kinds of things about physics. But worrywarts fretted that these wise ones would instead open up black holes right here on terra firma….and swallow up everything! Two fellows in Hawaii even filed a “cease and desist” lawsuit, but the far away European scientists pooh-poohed it all. Not to worry, they said, any results of their tinkering would be at the subatomic level. Nonchalantly, chuckling at these unscientific nutjobs, they flipped the switch….and half the world’s wealth promptly vanished into a financial black hole! The week ending Oct 10 was the worst week for U.S. stocks since 1914  [!]

    SIR – Can it really be a coincidence that within weeks of the Large Hadron Collider being switched on for the first time a financial black hole has appeared in the universe? – Barclay Price, Edinburgh     (letter to editor: Economist)

    And from the Yahoo question board:

    How did the Large Hadron Collider cause the biggest stock market crash in History?

    Apparently taking this for a serious question, people wrote in to say that 1929 and 1987 had seen larger single day crashes, that the market slide had begun a year ago, and that real estate and bank shenanigans, not physics, has caused the meltdown. And besides, like all new projects, the Collider didn’t go online as scheduled, but glitches and difficulties kept it under repair from the start.

    But let these apologists say what they will….it was those infernal scientists! They can’t leave well enough alone. Always have to mess with things. Just like when my son used to work the car window up and down, up and down, and I’d tell him not to because he was going to break it. And do you know what happened? Exactly…..and I was out the cost of a new window motor. Of course, breaking a car window motor is not as serious as destroying the entire worldwide financial system, but the principle is exactly the same and I wasn't happy.

    In the aftermath, Alan Greenspan testified before Congress:

    “We are in the midst of a once-in-a-century credit tsunami. Central banks and governments are being required to take unprecedented measures. You, importantly, represent those on whose behalf economic policy is made, those who are feeling the brunt of the crisis in their workplaces and homes. I hope to address their concerns today.”

    This is the same Alan Greenspan whose voice to the financial community used to be like that of God, the only difference being that God knew what he was talking about. Not that Mr. Greenspan wasn’t bright and competent and all…..it's just that it took only a single flaw to bring down a whole lifetime of work. As chairman of the Federal Reserve Bank, he’d issue statements at least once a month when setting interest rate policy. He’d make the statements incomprehensible….it was almost a game. He’d rehearse them in his head. If they could be understood, he'd rework them. Finance people would strain to discern his real intent, but of course, the task was impossible….by design. Far from becoming fed up with such obscuration, they took it all for brilliance! I mean, any street person would recognize a con-job in two seconds flat, but the bankers hailed it as wisdom from on high. After all, they were making tons of money. Did anything else truly matter?

    Mr. Greenspan’s successor, Ben Bernanke, is more straightforward. Mr. Greenspan himself became that way addressing Congress. He dropped the smart-alecky double talk. His words were clear. And not very pretty.

    “Given the financial damage to date, I cannot see how we can avoid a significant rise in layoffs and unemployment. Fearful American households [not to mention….which he didn’t…the rest of the world] are attempting to adjust, as best they can, to a rapid contraction in credit availability, threats to retirement funds, and increased job insecurity. All of this implies a marked retrenchment of consumer spending as households try to divert an increasing part of their incomes to replenish depleted assets, not only in 401Ks, but in the value of their homes as well.”

    No more smug cuteness building indecipherable word castles. For, alas, “those of us who have looked to the self-interest of lending institutions to protect shareholder’s equity (myself particularly) are in as state of shocked disbelief.”

    Then Mr. Greenspan discusses what triggered the collapse: factors involving CDOs, already discussed here.

    And…

    “It was the failure to properly price such risky assets that precipitated the crisis. In recent decades, a vast risk management and pricing system has evolved, combining the best insights of mathematicians and finance experts supported by major advances in computer and communications technology. A Nobel Prize was awarded for the discovery of the pricing model that underpins much of the advance in derivatives markets. This modern risk management paradigm held sway for decades. The whole intellectual edifice, however, collapsed in the summer of last year because the data inputted into the risk management models generally covered only the past two decades, a period of euphoria.”

    Note the absolute failure of the best and the brightest – the cream of the crop of human experts. A Nobel Prize was awarded, for crying out loud, for the economic model that would subsequently ruin us all! This was the not work of con men, but of the most learned, the most highly educated (the most profit-driven?) persons of society. And the final admission is staggering: nobody thought to test the model outside of partytime – “a period of euphoria.” Nobody thought that the real world might be different than the party world!

    Isn’t there some scripture somewhere about how you can’t trust “nobles” as far as you can spit?

    Do not put your trust in nobles, nor in the son of earthling man, to whom no salvation belongs.
     His spirit goes out, he goes back to his ground;
           In that day his thoughts do perish.   Ps 146:3,4

    And doesn’t this validate how Jehovah’s Witnesses don’t bow and scrape and slobber over today’s higher education?Instead they extract from education the ability to make a living, while drawing on other sources for wisdom.”

    After his statement, the House Committee grilled Mr. Greenspan for awhile, forcing him to admit:

    “I found a flaw in the model that I perceived is the critical functioning structure that defines how the world works. That’s precisely the reason I was shocked…I still do not fully understand why it happened, and obviously to the extent that I figure it happened and why, I will change my views.”

    I was going to offer up some feeble joke about how the flaw he didn’t reckon on was the Hadron Collider. But I won’t do it. The whole mess is too serious and sad.

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    Tom Irregardless and Me     No Fake News but Plenty of Hardship

  • Wealth Distribution and the Jubilee

    I plucked the latest Economist from my mailbox and thought I’d picked up the Watchtower by mistake. “World on the Edge” read the headline. Sure enough, on the cover was a silhouetted figure peering fearfully over the edge into the chasm below. And the edge was crumbling. Such illustrations have become commonplace in these recent days of financial meltdown.

    A week or two ago, news anchor Suzie Gherow asked her economist guest (alas, I forgot his name) if he could come up with a moral to the unfolding crisis. He observed that many peoples worldwide look to the American economic system as a model to admire and emulate. He wondered if they would still do that "when they see how badly we’ve behaved.” As if responding to cue, Vladimir Putin, of all people, recently accused: “Everything happening now in the economic and financial sphere began in the United States. This is not the irresponsibility of specific individuals but the irresponsibility of the system that claims leadership.” I read this in an on-line newspaper. It included comments. Most bloggers agreed with Putin.

    At any rate, government leaders are scrambling to come up with innovative solutions, doing things that not long ago would have been unthinkable…..countries assuming their banks’ bad debts, even nationalizing the banks….a partial nationalization here in the U.S, which is close to heresy in the land of free enterprise. One almost thinks of those verses that tell how mountains and hills during the “last days” would melt. The very institutions that seem to us as solid and unshakable as the literal mountains seemed to ancient peoples, are indeed shaking quickly.

    In such a climate, it becomes crucial to assign blame. With that in mind, the appropriate committee of Congress (the House Committee on Government Reform) recently grilled Lehman Brothers ex-CEO Dick Fuld. For the most part Mr. Fuld outmaneuvered them. There’s a lot of Congressmen on that committee, and they all had to have their crack at him, so they weren’t allotted too much time apiece. Mr. Fuld succeeded in running out the clock…..repeating questions aloud, questioning premises, answering slowly and deliberately. Plus, there were not a few windbags among those politicians who wasted much of their time formulating their questions….you know, with prefaces and addendums and things, the way politicians like to do. Too, the Reprentatives were so wrapped up in their own questions that they didn't listen to answers of other people's questions. Thus, there was much repetition.

    While Mr. Fuld was being interviewed, CNBC reported that a sore Lehman employee had socked him in the kisser some days ago while he was working out at the company gym!….a move he apparently did not outmaneuver.

    Depending upon who you listen to, Mr. Fuld conveyed genuine remorse for Lehman’s demise. On the matter of compensation, however, he didn’t budge an inch. Though he made tens of millions of dollars in the very year his company tanked, that was proper remuneration, he insisted. After all, he pointed out, had the company remained solvent, he would have made much more. But this didn’t sit too well with the general public. If I had a dollar for every gripe I’ve heard about “obscene profits” of the big bankers, I, too, would have obscene profits and people could gripe about me.

    When the new system at last arrives…..the government from God that the Bible speaks of and that Jehovah’s Witnesses advertise……will there be “obscene profits” in the hands of a very few? If the economic system handed down to ancient Israel is any guide, the answer is no. The Jubilee provision would see to that.

    Every 50th year of that ancient agrarian system was the Jubilee year. At that time, each Jew was restored to his or her original allotted land inheritance. Through an interplay of hard work and dumb luck some would have prospered in those 50 years, others would have declined, maybe to the point of becoming impoverished. Land might well have been bought or sold. But not in perpetuity. On that 50th year, all things were set as at the beginning. Thus, while one would be rewarded for one’s work and business acumen, there would never take root a permanent underclass, nor a permanent wealthy class…..a situation characteristic of most societies today.

    Some aspects of the cycle repeated every 7th year. Due to debts incurred, a Jew might even sell himself into slavery to one of his more prosperous neighbors. Laws regulated against mistreatment; moreover after seven years at most, the individual was set free, and that with a gift (from the prior owner) to assist him in starting anew. Again, neither a perpetual privileged class nor a locked-in poverty class could ever take root under that God-given arrangement.  Even were a man to squander every opportunity he had, the law was such that his children would still live to see equilibrium restored.

    Awhile back I ran a post entitled Slavery in the Old Testament, intending to counter those critics who rail against the Bible for acknowledging and regulating slavery, rather than forbidding it. The post clarified the nature of OT slavery and, to my surprise, some commented that such slavery sounded pretty good compared to the plight of the homeless today, or even the working poor. Screecheven broke it down into figures which I will reproduce, confident he won’t mind:

    “In the US minimum wage is currently $5.85 an hour. Lets suppose that you work 2 jobs; one FT and one PT. So 12 hours at that pay is $70.20 before taxes. After taxes are withheld, you have $56.87 a day left. You spend $65 (you have a cheap one) at your doctor's office. You get lucky and only spend $4 on the antibiotics that you need. You also are forced to take 3 days off from both jobs while you recover. Total cost is $239.58. That's four and a half days of pay. So if you have rent of $650 monthly, $135 monthly utilities (phone, electricity), $100 monthly food, $50 transportation costs. Now, in the above scenario, you have $200 left over every month. However, if you lose one of your jobs, suddenly you're short almost $200 monthly. What if you have a kid? 2 Jobs may not be an option and then you have to pay for daycare. Then you hear "go back to school." Yet if you have to take remedial classes to catch up, that adds to the expense (grants alone rarely cover everything). I guess the whole point of this rambling is that to overcome poverty in this world takes an astounding amount of sacrifice and will, with no guarantee of success. In fact, you also don't get real medical attention because the medical bills can pile up. I've seen and experienced the difference in medical care that you receive when you can afford to pay the bill vs not. It's actually a worse situation today…”

    About a third of all those in Congress are millionaires, with a higher proportion in the Senate. Less than 1% of the general population fall into that category. It doesn’t give confidence that one might get justice from these guys, does it?….how many of them can even imagine how ordinary people live? Yet their wealth is dwarfed by that of the high-profile bankers who have lately been testifying before them….guys like Dick Fuld. A little Jubilee might work wonders today.

    Of course, it could never be superimposed upon today’s society, just as Jesus said: one can’t pour new wine into old wineskins. The prevailing system wouldn’t accommodate it, few folks today have dispostions that would tolerate it. But those trained in Bible principles today should be amenable to it or whatever economic system God provides in the new order. There’s no telling to what degree, if any, God’s new system will draw from that ancient Jubilee arrangement. Nonetheless, the arrangement does offer a glimpse into Jehovah’s thinking.

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    Tom Irregardless and Me     No Fake News but Plenty of Hogwash

  • Bailing, Bailing, and Bailing

    It seemed certain that the House would pass the bailout bill, but it almost didn’t happen. It took two tries.

    Conservative House members cited their constituents, who demanded by a 9 to 1 margin (if not more) that the plan be rejected. The threat of another Great Depression didn’t faze them. Bailing out Wall Street bankers just made their blood boil! Would those same bankers bail them out if they fell behind in their mortgages? HA! Out on the street they would go! Ask anyone who’d been late with a credit card payment and in consequence seen their interest rate jump from 10 to 30%, and that with the bills deliberately arriving only days before payment was due……no, there was not much sympathy for big-time bankers. Tuesday (9/30/08) that bailout package went down by a 228 – 205 vote.

    But the stock market immediately dropped 800 points. And small businesses back home were promptly frozen out of credit markets as banks simply stopped lending (even to entire states, like Schwarzenegger’s California). By Friday the Representatives were in a different mood and signed off on a slightly revised bill. Sixty of them had changed sides. The new vote was 263 yea, 177 nay.

    The nature of the revisions is significant. The approved package took up 450 pages, whereas the initial proposal took up 3. You can read three pages; Representatives did and concluded the bill stunk. But do you seriously think these guys are going to read 450 pages? In a two day period? You just check to see that your own pet project is in there, and sign on the dotted line. Incredibly…..I mean, this is truly astounding, given that life or death for the entire worldwide financial system was purportedly at stake….Congresspersons loaded up that final bill with pork….a few million for this favored project, another few million for that one….same as they always do! Total added cost: $100 billion! PorkFor example, it was stipulated that from this point on, government subsidies for mental health disabilities were to be on par with those for physical disabilities. (though perhaps addressing mental disabilities isn't so dumb an idea in the wake of the current meltdown)

    And they nearly came to blows blaming each other. On the very cusp of that first vote, the Democratic House Speaker nancy Pelosi launched into a bitter tirade blaming the entire mess on the Republicans and its President in particular. At that point it’s said that some of those Republicans who were prepared to vote “yes” dug in their heels out of sheer partisan spite and switched to “no.”

    It is still to be seen if the world’s financial system begins to stabilize or if the woes have only begun. But either way, this past week has not been kind to human governments or those who put their confidence in them. Instead, its played into the Bible theme that Jehovah’s Witnesses have been advancing forever, that humans do not have the ability to rule themselves. They simply don’t have it, same as they don’t have the ability to fly or walk through walls. Avarice, arrogance, corruption, or just plain ineptness wins out every time.

    JWs are the only major faith I know of that takes this position. All others assume, to a greater or lesser degree, that God is backing the present human system of governments. As if to illustrate, after that second vote the House Minority Leader John Boehner reminded all of the U.S. currency motto: in God we trust. “We’re going to need his help,” he warned his colleagues. (Privately he called the bill a "crap sandwich.") But the present system of worldwide rulership….scores of independent nations eternally pushing and shoving each other… isn’t God’s system. Rather, it finds its roots ages ago in rebellion against God’s own sovereignty….as shown way back there in the Adam and Eve account. After a sufficiently long (thousands of years) trial period during which the unsuitability of human rule makes itself blatantly clear, God intervenes with his own kingdom, which is really no more than a restoration of his original purpose. The “Lord’s prayer,” which everyone used to know, informs that his will is done only when his kingdom comes (as opposed to patching up disintegrating human governments):

                                                    your kingdom come,
                                            your will be done
                                            on earth as it is in heaven           Matt 6:10

    Or as foreshadowed in Daniel 2:44: 

    In the time of those kings, the God of heaven will set up a kingdom that will never be destroyed, nor will it be left to another people. It will crush all those kingdoms and bring them to an end, but it will itself endure forever.

    Announcing this kingdom is what Jehovah’s Witnesses are all about. Lots of people….most people by far…don’t really want to hear it. But there are some who do, some who respond to the JW invitation to a Bible study, and some of those who….recognizing a message that is found nowhere else….attach themselves to the faith.

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    Tom Irregardless and Me     No Fake News but Plenty of Hogwash

  • Where is Eliot Spitzer When You Need Him?

    They cheered on the stock exchange floor the day Eliot Spitzer went down. The past year has been dismal for stocks, but prices soared on that day! The Sheriff of Wall Street was dead! In fact, he was better than dead…..he was disgraced.

    Regular folk heehawed and ridiculed. Under pressure, I reluctantly agreed to close out my Eliot Spitzer category (but reneged), yet even then  I stated:

    “As NYS Attorney General, Eliot Spitzer took a lot of bad people out of circulation, including some high finance types usually thought untouchable. That should not be taken away from him. New Yorkers can be grateful. Advocates for market fairness say he’s done more to clean up Wall Street than anyone else in decades.”

    Eliot’s undoing was sexual misconduct, but it now appears that the financial world could have used 1000 more Spitzers, as opposed to dumping the one they had. Even if every one of them cheated on their spouses. Look, he wasn’t put there to teach Sunday school. His mission was to kick butts.

    It now is clear that there were many whose butts needed kicking. More butts than even a thousand Spitzers could have managed, even if he knew which ones to kick and which ones to leave alone (an unclear assumption). As this post is being written, Henry PaulsonBlog_pictures, former Goldman Sachs CEO and now Treasury Secretary, is telling Congress that all the financial world’s wheeling and dealing has gone bust and that (without penalizing the ones who ran it aground!) the taxpayer has to bail them out. It’s a massive bailout he wants, to the tune of $10,000 per American household! On top of debt the public has already assumed from Fannie, Freddie and AIG. Congressmen are taking turns to vent, the way they do, but in the end, we all know the deal will pass, or some close modification, because the apparent alternative is another Great Depression. Once again, the Economist nailed it. Their latest issue’s cover is a portrait of Paulson pointing, just like on those Uncle Sam recruitment posters, saying “I Want Your Money.”

    Seeing it all play out in Congress, it’s hard not to think of that description from Micah 7:3.

    the ruler demands gifts,
    the judge accepts bribes,
    the powerful dictate what they desire—
    they all conspire together.             RVS

    Or, as the English Standard Version puts it….

    the prince and the judge ask for a bribe
    and the great man utters the evil desires of his soul
    thus they weave it together.       

    The great men, through their greed, have broken the system and look to the public purse to get them funded again. Up to the final months executives were distributing billions in bonuses among themselves, exorbitant rewards for failure! The prince and the judge aren’t happy about it, of course, but they’ve long played ball. They’ve made laws allowing the mess to mushroom. They’ve formed regulatory bodies that have watched it all develop. Some have taken huge lobbyist payments from the great men….can it be said they are they “bought and paid for?“ As Micah says, they all weave it together. (ESV)  Or, as rendered in the Revised Standard Version, they conspire together.

    A co-worker of mine spotted two huckster scruffy-type guys on the internet (did he really call them “douchebags?”) who would buy up mortgages and immediately flip them to large institutions. Anything they bought they could sell….no questions asked. So much money was to be made through commissions and inventive accounting that underwriting standards sank lower and lower, and in the end vanished completely. Like a bartender pushing drinks on drunk patrons, the industry pushed mortgages on people who clearly couldn‘t afford them, people who counted solely on the prayer that their property would increase in value. Meanwhile, these two guys blew every dime they made….sometimes $100K in a week!….on penthouses, women, cars and so forth.

    Mortgages they, and thousands like them, traded were massed into huge collateralized debt obligations and peddled to financial institutions the world over. The promised cash flows showed up as assets, masking the shaky debts they really were, on accounting books. Sounder debts were steadily watered down with junk until, in time, nobody knew what they were buying, but the commissions and paper profits were so lucrative that they kept buying anyway. Leveraging made it all the more dicey.

    It all worked until it didn’t. Word flashed about that folks were defaulting, property values were falling…..and….who could have foreseen?…those debt obligations might not be worth a fraction of what they were sold for. It’s not as though the free market had ever determined their value…..they’d all been priced rather arbitrarily. Suddenly nobody wanted these CDOs anymore. The hucksters were stuck with a million in mortgages they could neither sell nor service. They panicked and bolted their doors.

    No doubt, that’s just a small (and oversimplified) chunk of a mountain of mayhem.

    So the huge bankers (HB&B….Huge Bank and Broker, Bill Cara calls them) fell over the precipice and look to the general public to pull them out. World finances go down the tubes if the answer is “no.” As I write this, it’s by no means clear how this will all play out. There’s hope the bailout will stem the blood flow, but is it perhaps the first of many? And the long-range implications for the taxpayer and generations to come are not pleasant to contemplate.

    Where is Eliot Spitzer when you need him? It would have been good to have him around, if only for the sake of the fireworks. But in the end, would even 10,000 Spitzers have turned the tide? In this system “that which is crooked cannot be made straight.“ Greed almost always wins out, spoiling humankind’s better accomplishments. Not too long ago I was speaking with one of those optimistic atheists, the youthful type who imagine human science and wisdom will solve all problems. He gushed “things have, by nearly every measure, gotten better as time progresses.” I replied that I could think of some measures by which they have not.

    Watching televised hearings these past few days, I’ve just thought of another. This week has not been kind to those who put their trust in human efforts.

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    Tom Irregardless and Me             No Fake News but Plenty of Hogwash

  • Henrietta Lands a MegaMarket

    When City! Newspaper wrote about Wegmans Food Markets a while back, they ventured: “We suspect many Rochestarians would like to live in Wegmans.” They were right. Visit a store and you almost think you‘re at an outdoor market. People in chef hats stop you and ask if you want to try this or that delicacy they've just rustled up. You should always say yes….who would think food could taste so good? So yes, I can’t think of anything cooler than a loft apartment overlooking produce and opening onto imported foods. And now a new store opens in Henrietta this week. A megamarket. Any apartments to lease?  Alas, not yet.

    There should be most everything else, though. A second floor restaurant and internet café, of course, overlooking the market area. I love when they do that. I‘ll sit up there sipping coffee, pecking away at what eventually becomes a post. Not most of my posts, of course, or even many, but I‘ve written a few at other Wegmans. Maybe there will be a tea bar, like at the Pittsford store. Or a seafood bar and grill, also like at Pittsford. You can dine right there between grocery aisles amidst folks fetching bakery goods, meats or seafood products. How cool is that?

    The new Henrietta store takes up 30 acres and looks like a castle, crowned with a 77 foot clocktower. Half of the acreage is green space. There's a pond, spacious lawns, 250 trees, 1,600 shrubs, 2,600 annual plants and two acres of wildflowers. They like flowers at Wegmans. There's always tons of them. From store front along Calkins Road, ornamental streetlights, trees and sidewalks stretch 1,700 feet west to the town’s Senior Center.

    In many ways, Wegmans has become the public face of Rochester, which was once a Kodak town. Is there not something vaguely disquieting about a food retailer (now the area’s number two employer) taking the spot once held by manufacturing? But this is new New York. Did Governor Patterson really say the state now exists on a “social services-based economy?” Kodak is a shadow of its former days. Partly it’s moved afar, and partly it’s withered as it‘s mainstay film product has become obsolete. In recent years, they’ve even taken to blowing up their vacant buildings rather than pay taxes on them.

    But if Kodak and New York are in hot water, that’s no reflection on Wegmans, is it?  Wegmans fields thousands of requests from people asking them to open supermarkets in their communities. But they expand only slowly and deliberately. Founded in 1916, it wasn‘t until the 1990‘s that they ventured out of state; a new store in Virginia and one in Maryland currently represent their most southern point. At present there are about 80 stores. In 2006, Consumer Reports magazine ranked them the top supermarket chain. Fortune Magazine has put them on their ‘100 Best Companies to Work For’ list for eleven years running; in 2005 they were # 1; last year they were #3. “The best chain in the country, maybe in the world,” is how analyst Neil Stern described it to the Wall Street Journal back in 1994.

    As a little kid, I’d go shopping with my mom back when Wegmans offered green stamps, back when no one left shopping carts in the lot but walked them back to the store.

    When the WalMarts rolled into town, Wegmans didn’t just roll over and die, but held its own. The company revamped its own pricing structure and sent everyone in greater Rochester a videotape explaining the changes. Mail carriers cursed CEO Danny Wegman for days, but not as much as they would have cursed a….say Home Depot or Sears. Wegmans is local. It gives back significantly to the local economy, runs a large college scholarship fund, and enjoys tremendous good will.  "People tell us they like shopping at Wegmans because our employees are happy, and that makes them happy," says CEO Danny. "We have always believed that in order to be a great place to shop, we must first be a great place to work." The Wegmans stores are decidedly upscale, yet without gouging the ordinary shopper. One can stick with the basics and not do too much worse than the huge cost-cutter stores, all-the-while enjoying far better service and happier people.

    When Bob Wegman died in 2006, the community paid their respects for days. Civic leaders, food service execs, employees, and plenty of just regular folk crowded in for his funeral. Rival food chain Tops took out a full page memorial ad in the Democrat and Chronicle:

    The Tops family regrets the passing of our colleague Robert Wegman. Our thoughts and prayers are with his family and fellow associates.

    The papers heaped praise upon him for days. He had community spirit, enthusiasm for employees, industry innovation and so forth. And of course, sense of humor. The story was told of an obnoxious industry consultant, a character who rubbed everyone the wrong way. One day he complained to Mr. Wegman “Why do people instantly dislike me?”

    “Well,” Bob replied, “it saves time.”

    Rochester and Kodak were once synonymous. Growing up, it seemed every other kid’s dad worked for the film giant. (Mine didn’t, though my grandfather had) “The company treats its people so well that the unions can’t get in”…..I heard that refrain constantly. But it‘s been decades since I heard it last. Struggling to thrive (or even survive) in the digital age, Kodak steadily shed the considerable paternalism it once had. At one time it might have ranked high on that Fortune list. But now it is Wegmans' day in the sun.

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    Tom Irregardless and Me        No Fake News but Plenty of Hogwash

  • The Death and Rebirth of the Placebo

    For just a brief moment, there was no placebo; there was no such thing. Just for a day. Placebo had its 15 minutes of antifame. And then the day passed, placebos resurfaced, and they've ruled ever since, just as before.

    That day was May 24, 2001, and the front page read Survey Finds Placebo Effect Imaginary. From the Associated Press:

    "One of the most strongly held beliefs in medicine, that dummy pills or other sham treatments greatly help many patients, has been called into question by Danish researchers who found little or no "placebo effect" in dozens of studies."

    Those Danes had looked at study after study after study in which the experimental new drug was compared to the look-alike dummy pill, the placebo. If the new drug was any good, test results beat that of the placebo. But where researchers bothered to include a third group receiving neither drug nor placebo, the Danes found that that group fared about the same as the placebo group. In other words, people sometimes get better all by themselves! They sometimes do, in fact, just about as often as those who received the placebo.

    I spoke to a few people involved in pharmaceuticals. They hadn't read the paper and hadn't heard of the survey and didn't believe me. A few days later, I googled "placebo." Conventional wisdom ruled once again. My article was buried many pages back. It took forever to find it. (But you can find it here.) Nobody ever touched the subject again.

    I suspect placebo is a notion too good and too lucrative to let die. After all, when you're testing your new drug for efficacy and you can't wait to urge people to ask their doctors if it's right for them, you want it to seem like it has teeth. If it's so much better than the placebo and the placebo is so much better than nothing…..well, you've got some powerful stuff. But if the gap between nothing and placebo collapses, then your drug is not so effective as you thought. Better to keep that gap intact: broad shoulders for all new meds to stand on!

    The fact is big pharma pushes a lot of drugs on us. We (in the USA) spent $2.7 billion on prescription drugs in 1960. By 2002 it was $162 billion. There were 600 prescription drugs to choose from in 1960. By 2002 it was 9000. Plus 4000 over-the-counter. Are we that much sicker that we need all those meds? Or conversely, are we that much healthier now that we have them?

    And where did this term "meds" come from anyway? They're medicines, dammit! Isn't "meds" a sneaky con attempt to make them seem warm and fuzzy, friendly-like?…every day you take your meds just like you take your tea, or chocolate.

     

    That's why when Pop goes to the doctor and the doctor "puts him on" this or that drug, Pop tells him to forget it. Either that or because he's a stubborn cuss. But it's hard to tell someone 85 who's in perfect health that he'd be so much better if he'd just be gobble down more pills. It's a standing joke with us. I meet him in the doctors office, after his yearly physical. (it took forever to get him to agree to those, and he only did so for insurance reasons) "What do ya think, Pop?" I ask, "Want me to get a wheelbarrow for all your pills?" "HA!" he says, "that'll be the day! No pills!"

    Most people, overawed by our age's slobbering idolization of science and the doctor's high-priest membership of that discipline, obediently swallow anything they're told to. Not Pop. "Your blood pressures too high," the doctor says, reading his machine. "I want you to take these beta-blockers." "What I'll do," Pop says, "is buy one of those machines myself and see if I can get the blood pressure down with diet and exercise. If I can't, then I'll think about your beta-blockers." He's been able to do exactly that, aided with an immediate drop in blood pressure that comes just from not being in the doctor's office, where we're all at our hypochondriac worst.

    Yeah, the old boy thinks that if you steer clear of drugs then one day you'll die in your sleep or drop in your tracks. And isn't that what we all want? A graceful exit when we go. But if you gobble down every pill someone pushes at you, you'll waste away slowly sans dignity in a nursing home. Who's to say he's wrong?

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    Tom Irregardless and Me       No Fake News but Plenty of Hogwash

  • Pool Alarms and Parkinson’s Law

    The legislators of New York, eager to safeguard us all, have decreedthat, from now on, any new swimming pool deeper than 2 feet must come equipped with an alarm that will raise all hell inside & outside the house should someone (or something) fall in. Thus, Rochesterians who live in the poverty zone (trust me, there are many) who have no air conditioning but several broiling kids, who used to cool them off on a hot day with one of those cheap, inflatable pools, are now protected from that relief, since the price of an alarm exceeds the price of the pool. We just snapped a short spell of 90+ degree weather, with obscene humidity, the first of many this summer. In the air conditioned Albany State Legislature, some legislator is hero of the day. "If it saves one life, it's worth it!" he says. 

    Trouble is, there's not many things that won't save at least one life. What of the imposition for everyone else? Mind you, I have nothing against pool alarms. They seem a good idea. It's the mandating of pool alarms!

    Folks who remember when you could ride a bicycle without a helmet, indeed, even drive a car without a seatbelt, may need help to know what to make of this. That's why this post is written. In Europe, by the way, where they bicycle far more than we do, nobody wears a helmet. "It would muss up my hair," explained one Frenchman to the Wall St Journal.

    This new pool alarm requirement must be looked at in the light of Parkinson's Law, (the 2nd one) which suggests that, having utterly failed to acheive anything of real value, officials nevertheless must justify their existance. Therefore, they redouble their efforts to accomplish nonsense.

    Parkinson's Law, derived in the 1950s by C. Northcote Parkinson, is actually a body of business and organizational laws which are usually stated in economic terms, but can be amended to fit swimming pools. The law which specifically applies, the 2nd law, states that the time and money spent on any item in any organizational agenda is inversely proportional to its importance. In his definative book "Parkinson's Law," Dr Parkinson illustrates his second law with a business board meeting:

    The lead item on the agenda is a nuclear reactor for the company plant. It is approved immediately, not because it is a good idea, indeed, it is suspect, but because few people on the board know what a nuclear reactor is, and those who do have no idea what one should cost. The two people who do know something have no idea where to begin with explanations. They would have to refer to the blueprints. No one present can read blueprints, yet no one present would ever admit they could not!  Easier just to say "yes." The reactor is approved.  Time spent: about 2 minutes. However, several members have inward misgivings. They wonder if they've really been pulling their weight. They resolve to make up for it with the next item.

    The next item is a bicycle tool shed for the employees. Here is something most can get their heads around. They bicker over its design, its materials, its location, indeed, even its necessity, since the ungrateful employees only take whatever you give them and demand more! Time spent: about 1 hour.

    The next items concerns the coffee that is served at board meetings: its brand, supplier, and cost. No one is present who doesn't know all there is to know about coffee, and the ensuing discussion lasts the rest of the day!

    Now, if we postulate that Parkinson's 2nd law applies, and that requiring pool alarms is an accomplishment relatively trivial, then there has to be some "big fishes" that got away. Are there?

    The day before the local paper reported on pool alarms, it reportedon a new "academic excellence" surcharge for nearby SUNY Geneseo State college. The surcharge, which kicks in a year from September, adds $1000 to the annual tuition of $4350, a 23% increase! Where one SUNY college goes, soon the rest can be expected to follow. Lawmakers are clearly not interested in saving that "one life" of a poor child so that he may attend college!

    Besides the bruising economic threats people face, there are the ever-growing threats to education quality, public morality and decency, even threats to spirituality. All these areas are ignored while legislators piss away their time on physical safety, a comparatively insignificant area which even a Frenchman knows how to keep in proper perspective so as not to muss up his hair!

    As if to underscore the point, New York Governor Elliot Spitzer is crisscrossing the state, challenginglocal citizens to play "Where's Waldo" with their state senator. He'll hold up a picture of the empty Senate chambers. "Where is your Senator," he asks. "He's not here. We've looked all over." He's mad because Senators voted themselves a pay raise and then took off for the summer, leaving stuff on the plate. Important stuff. Necessary stuff. Fundamental stuff. (Most importantly) Stuff Eliot vowed to get done.

    They did, however, make it tougher for poor kids to cool off. And that's something.

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    Tom Irregardless and Me    No Fake News but Plenty of Hogwash

  • Douglas Coupland and the McJobs

    How can a company improve the bottom line? Why not take the 8% or so of workers making the most money…..how can they not be dead wood….and fire them! And, just in case they're not dead wood, offer to hire them back at lower pay! Of course, no company would do such a thing, if only out of self interest, since morale and customer service would surely plummet.

    Actually, yes they would! Circuit City just did, announcing they would right away can 3400 of their salespeople. (with severance) Then, after 10 weeks, they’d offer them their old jobs back at the new lower rate of pay. “This strategy strikes me as being quite cold,” said Bernard Baumohl, executive director of the Eonomic Outlook Group.

    Yes, it does. And it’s hard to believe the company won’t suffer for it, though Wall Street thought otherwise and bid up the shares 1.9% that day. It’s not as if tanking employee morale won’t be noticed by customers, as it might be if workers slaved in the dungeons or somewhere out of sight. Sharpen your skills in customer service? What on earth for? the surviving salespeople have to ask themselves. Have they not been told in the clearest possible way that their jobs are dead end?

    These days companies represent themselves with mission statements, in which they declare their reason for existence with regard to their industry, customer satisfaction, and employee growth. To say that the “employee growth” part is just so much horse manure would be an exaggeration. Progressive companies do exist, generally in thriving industries, where even chronically cynical malcontents are, within reason, happy to work.  But in retail, the number of such companies dwindles.

    And what about WalMart? What became of their announcementback in January to implement variable employee scheduling, based on real time traffic flow data. Part time would be called in only when needed and sent home once the need subsided. So if you worked there, you’d find it very difficult to both budget and “have a life.“ If, for example, you need a babysitter while you work, good luck. There's no telling when you'll be scheduled, nor how long you'll be scheduled for. Make yourself available at all hours, which you can do when your part time job is top priority in your life, and you can expect to be called in often. Limit your availability and, well…get used to oatmeal.

    Walmart, they say (and now Circuit City?), is a major force in checking consumer inflation. That's no small feat. But when it is achieved by beating the snot out of their own people, you have to consider.

    A few years back I worked a spell, part time, for a retail support company that counted store inventory, a company described by one of its own (former) managers as the most selfish company he’d ever seen. This fellow had managed for awhile, decided he wanted no part of it, so dropped back to foot soldier in order to find time for school. The stockholders couldn't be blamed for this one….this was a privately held company. They lowered the starting wage, limited raises to a dime or two at a time, and found innumerable ways to nickel and dime their own employees with regard to travel time, minimum shifts, and so forth. Yet even these misers never canned their best people so as to hire them back at lower pay.

    Generation X: Tales for an Accelerated Culture, by Douglas Coupland, was published in 1991. It was his first novel, and yes, it was he who invented the term. Hard to believe it’s only been 16 years. Since then we’ve also been told about Generation Y, but this new label is only a rip-off, built on Mr. Coupland’s foundation.

    Generation X’s characters are drawn from the disillusioned generation, the first really, to realize that their future would not be the well paying, secure, pensioned jobs of their fathers, but instead the transient, low paying big box jobs, with no benefits and no retirement. The mini-story which is Chapter 8, about the suburban planet where terrestrials do nothing but get fired from their McJobs (Coupland popularized the term, though he didn‘t invent it), is alone worth the price of the book.

    One might reasonably surmise that any generation owes it to the next to leave the world in better shape than they themselves found it. Quite obviously, the present generation has failed to deliver. No wonder the younger generation disconnects.

    "McJob"was added to the Miriam-Webster dictionary in 2003, much to the annoyance of McDonald's, who suggested the term might more properly be defined as “teaches responsibility,” since many of their franchise owners started as line employees. But Miriam-Webster would have none of it and stuck with their own "mcJob" definition: a low-paying job that requires little skill and provides little opportunity for advancement.

    The tragedy is not that these jobs exist. Realistically, not every job can put you on the fast track to the White House. The tragedy today is that not much except these jobs exist. Unless you have some college, of course, and that, over time, has been priced out of the reach of many.

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    Tom Irregardless and Me     No Fake News but Plenty of Hogwash