August 20, 2010

Is Fox News at the center of global terrorism?

Probably not.  But, last night Jon Stewart presented a compelling case:

The Daily Show With Jon StewartMon - Thurs 11p / 10c
Extremist Makeover - Homeland Edition
Daily Show Full EpisodesPolitical HumorTea Party

Despite the politicization that has happened with the Ground Zero Mosque issue (it was covered by Fox News without much hubub until the issue was brought up by some conservative bloggers, and it became a rallying cry), I think that the underlying problem is our diminishing freedom and tolerance in America.

Freedom and tolerance go hand and hand.   If I am going to be truly free, you have to be tolerant of me.  And, vice versa.  We all want our freedoms.  But, are all the people who cry for freedom also willing to be tolerant?  Interestingly, many people who hang their hat on freedom and liberty are also the ones who are the least tolerant of those who are different than themselves.

On the Ground Zero Mosque issue, critics are making a big leap from Muslim religious center to terrorist HQ.  Hey, if you really think that those Muslims are terrorists, why not have a nice centralized location where we can keep our eyes on them?  More seriously, if any Christian or Jewish religious location was being similarly characterized, there would be a lot of backlash.  Timothy McVeigh was both a terrorist and a Christian, so maybe we should be kicking all the churches out of Oklahoma City.

I've been lucky enough to have some international visitors stay with our family recently.  Their own country, Kyrgyzstan, is facing a lot of internal strife.  One of the benefits that our family has received from this visit is a new appreciation of what is greatest about America, or at least the concept of America.

Our strength comes from our diversity, and our tolerance of diversity.  The influx and acceptance of new people keeps us vibrant and entrepreneurial.  Our meritocracy and the rewards of hard work and ingenuity continue to provide incentive and opportunity for us all.  Our multicultural background keeps us creative, relevant, and culturally leading edge.  That freedom and tolerance provide the bedrock of what is special about America.

I've had it with the divisive politics of America.  Both parties succumb to it, regardless of who starts it.  The overall divisive atmosphere creates actions and reactions that are more aimed at trying to appear on the right side of the politics than on the side of freedom and tolerance.

Frankly, this is the area where I am most disappointed in President Obama.  There is no doubt that he's had to face a lot of tough situations, and that he was willing to take on big issues.  But, he was best positioned to take the high road on freedom and tolerance.  Those don't have budget impacts and can appeal to people from libertarians to the far left.

Yet, he hasn't followed through on closing Guantanamo and putting those captive there through some sort of legal process.  This should showcase our legal system and our belief in it.

He was wishy-washy on the Ground Zero Mosque issue rather than strongly defend a group's right to put a house of worship on their own property.  Kudos to Mayor Bloomberg for having the courage to take the right position here.

He hasn't closed the freedom loopholes in the Patriot Act, leaving us all susceptible to having our privacy violated without due cause.

He hasn't take a strong stand in favor of gay rights, including gay marriage.  Someone's love of the Red Sox doesn't threaten my love of the Yankees.  Why should someone's love of another of the same sex threaten my love for my wife?  Overall, we should be lauding people loving each other in committed relationships.  That provides the foundation for our communities and our families.  If you are truly pro-family, as many who are against gay rights claim to be, you should scorn those who get divorced.

Despite my dislike of the views of those of you who may disagree with me on the issues above, I'm very tolerant of your right to hold those views.  If we all practice more freedom and tolerance, it will be easier for us to solve more of the issues we face.

Hosting by Yahoo!

July 27, 2010

And then, nothing happened

With apologies to one of my favorite Monty Python sketches:


In February, March, and April, I wrote a series of posts about a serious issue with the Massachusetts municipal health care system.  These were spurred by articles in the Globe by investigative reporter Sean Murphy.  Sean's first article is here, and my first post on the subject is here.

Here's a short summary:  If you like in Massachusetts, chances are that your city or town has had a very rapid growth in the share of its budget that is used to pay health care costs.  In addition to the health care inflation we all feel, many cities and towns have very sweet deals for their employees: very low or no co-pays, very high benefit levels, very low employee contribution toward premium costs, and the ability to get health care for life after a small number of years of service.  In addition, many cities and towns don't force retirees onto Medicare after age 65, instead paying their health care costs until they die.

The biggest obstacle to fixing this has been the cities and towns' ability to negotiate with municipal employee unions on changes to their health care plans.  Most haven't been able to get their unions to give up the sweet deal they have.  Instead, cities and towns have asked the Legislature to allow them to unilaterally change their health care plan as long as they make it no worse than the state employee union plan.  Although it would be better if each city and town cleaned up their own mess (as my town did), that task seems so daunting that it would be better for the tax payers in the State if the Legislature allowed a unilateral change.

Unfortunately, the effort to fix this problem died a quiet death in our legislature at the end of June.  Sean wrote about it in the Globe at the time, but I missed it.  I wrote to my Representative (Charlie Murphy, who has replied very thoughtfully in the past), but he has not yet replied.  I'm disappointed that this opportunity to make our tax dollars go further has been lost for now.

In the meantime, keep after your city or town to negotiate for a more reasonable health care plan with the municipal employees.  Some towns are getting this done, and it is critical for both our fiscal health and to let us allocate our tax dollars to more urgent priorities.

Hosting by Yahoo!

July 21, 2010

The power of immigration

Yesterday, Fred Wilson posted about Immigration Reform.  I agree with him on the need for immigration reform and am glad that he's supporting Sen. Chuck Schumer in his efforts to push this through Congress.

Our country's greatest strength is its ability to take people from all backgrounds and to unite them with a common set of values that cuts across cultures.  Universal values like freedom, democracy, the presumption of innocence, and opportunity are magnets to people all across the world.  When we compromise these, even in the name of our security, we actually lower our opportunity and increase our risk.

There are been several disturbing trends in immigration over the past decade.  First of all, many people in the country mistake followers of Islam for terrorists.  Or, even followers of other religions (like Sikhs).  This creates a lot of ill will toward citizens and immigrants who don't happen to be Judeo-Christians.  Shame on us -- we have to remain open to people of all backgrounds who embrace our American values.  Moving away from that just reinforces the terrorists' message.

Also, the large number of Hispanic illegal immigrants has equated immigration reform with opening our borders to a large wave of Hispanic immigrants.  I'm not in favor of opening the borders to anyone who wants to come in.  But, I do think that we should always welcome hard-working people who want to live by our values.

We do need security at the border to ensure that people only come in through legal means.  But, we have to recognize that we have millions and millions of people who have been here for a long time that took advantage of our porous security and lack of policing employers.  If they couldn't get a job, illegal immigrants wouldn't come here.  Only a very small number of them come here with the intent of committing crimes, so we shouldn't criminalize the rest.

We're about to welcome into our home two family friends from Kyrgyzstan who are coming to the US until things stabilize in their home.  When you hear how immigrants and visitors view the US, you realize that we shouldn't take for granted how powerful our long-term values are.  And, we have to guard against compromising them and cutting off our greatest strength -- being the magnet for the world's best and brightest and integrating their diverse thinking into high-energy inventiveness.

Hosting by Yahoo!

June 17, 2010

Daily Show History Lesson

The oil spill tragedy in the Gulf is a disaster.  One reaction to the long-term problem is to reduce our dependency on oil so we have less need for risky drilling.  This isn't a new idea, as Jon Stewart pointed out last night.  Unfortunately, despite the urgings of the last eight Presidents, not much has happened.  I think that we need a 'man on the moon' type of commitment to this, encompassing boosting research in a range of alternative fuel options, encouraging investment in energy efficiency, and changing economic incentives so that each energy source bears its full cost, including environmental impact from spills, byproducts, mining, etc. 

And, as the Moment of Zen shows, ideas that used to be conservative can become radical leftist.  Maybe with some strong leadership from President Obama we can overcome our partisan differences to deal with this problem before 8 more presidents go by.



The Daily Show With Jon StewartMon - Thurs 11p / 10c
An Energy-Independent Future
Daily Show Full EpisodesPolitical HumorTea Party
The Daily Show With Jon StewartMon - Thurs 11p / 10c
Moment of Zen - 1951 Haliburton Promotional Film
Daily Show Full EpisodesPolitical HumorTea Party

Hosting by Yahoo!

April 05, 2010

Discouraging a Cadillac Plan

I wrote a series of posts a while back about the skyrocking costs of municipal employee health insurance in Massachusetts and the impact it was having on town budgets.  These were triggered by a series of articles by Sean P. Murphy of the Boston Globe.  Well, Sean is at it again.

Today's story points out that starting in 2018 these 'Cadillac' health plans will be subject to a new tax as part of the health care bill.  This tax is aimed at discouraging  companies from offering very high-end health care plans.  According to Sean's article, a family health plan that costs more than $27,500 would be subject to a 40% tax on every dollar over that threshold.  The hope is that employers will stop offering such high-end plans as they are excessive benefits that go way beyond what a typical market-level benefit is.  Unfortunately, if towns continue to offer these plans to their municipal employees, these taxes will further eat into stretched municipal budgets.  Note that these thresholds may increase between now and 2018, depending on the rate of medical cost inflation.

And, changes to these plans must be agreed to by collective bargaining.  The unions in the article point out that they have given up other things, including higher salaries, in exchange for these benefits.  I haven't done a salary analysis of municipal workers, but I think it is time for them to give up some of these excessive health benefits.

Amazingly, one town in the article, Framingham, has a cost of $40,475 per year for one of its health plans.  I can't imagine how rich that plan must be.  In order to get a sense of cost, I went onto the Massachusetts Health Connector site to see how expensive a plan can be.  If you aren't familiar with it, this is the exchange set up by the state where indviduals can buy health insurance from private insurance companies.  All the plans are compared on an 'apples to apples' basis.  They have Gold, Silver, and Bronze plans.  As an individual, I buy health insurance for my family through this exchange.  We pay the market rates, and I find it all very easy to use.  Like in the new US plan, in Massachusetts, you can't be turned down for pre-existing conditions (they never asked when I signed up), but everyone must purchase insurance or face a penalty.

I went onto the site today to price out a 'Gold' plan for my family.  We have two late 40s adults and two teenage kids.  A Gold plan on the MA site has the following characteristics:

No annual deductible (the health plan starts paying for everything from dollar one), $20 copay for doctor visits, $15 generic prescriptions, $75 copay for emergency room visits and $150 copay for hospital stays.  Other than these copays and the premiums themselves, there is no out of pocket costs for health care under this plan.

I am pretty sure that's better than the health plan that all of us have.  There are two providers for this plan, Neighborhood Health Plan and Blue Cross Blue Shield.  Neighborhood is relatively inexpensive at $1534/month.  Blue Cross Blue Shield, the same insurer that most of the municipal employees have, charges $2172/month.  Both of these are below the $2291/month threshold where the 40% tax kicks in.  Imagine what those folks in Framingham are getting for $3373/month!

I am fine with municipal employees getting a Gold-level plan.  But, let's not make it Gold dipped in Platinum with a Palladium finish.  Unless you live in a town like mine (Bedford) that has already successfully dealt with this issue, you need to force your town government to work out an arrangement with the town unions to lower the health care costs.  This will help the town avoid the 'Cadillac' plan tax and free up municipal tax dollars for more police, fire fighters, and teachers.  And, urge your state legislators to support a bill on Beacon Hill that gives the cities and towns the flexibility to change their health care coverage independent of collective bargaining, as long as their plan is no worse than the state employee health plan (wonder what that costs?).

And, this doesn't even deal with the very high percentage of premium costs that are paid by the town vs. the town employee, the fact that many towns don't force their retirees onto Medicare, and that it doesn't take a long stint as a town employee to earn free health benefits for life.  See some of my previous blog posts and Sean Murphy's articles for more background on the overall issue.

Today's article has a ton of comments already on  Many of them rail against the health care bill, citing the tax as a bad thing.  I view it differently -- I think that excessive benefits like this are Ok to be taxed, just like progressive income tax rates.  When you earn more, you should be able to afford higher taxes.  And, the threshold is so high that it isn't any sort of hardship for union members to get their plans back down into the tax-free zone.

Hosting by Yahoo!

March 26, 2010

Ignorance becomes hate

I was listening to a podcast of yesterday's Fresh Air while driving to my office today.  It referenced a recent Harris Poll that measured extreme views of President Obama.  The most striking numbers in the poll are these views of President Obama held by people who identify themselves as Republicans:

Majorities of Republicans believe that President Obama:

  • Is a socialist (67%)
  • Wants to take away Americans' right to own guns (61%)
  • Is a Muslim (57%)
  • Wants to turn over the sovereignty of the United States to a one world government (51%); and
  • Has done many things that are unconstitutional (55%).

Also large numbers of Republicans also believe that President Obama:

  • Resents America's heritage (47%)
  • Does what Wall Street and the bankers tell him to do (40%)
  • Was not born in the United States and so is not eligible to be president (45%)
  • Is the "domestic enemy that the U.S. Constitution speaks of" (45%)
  • Is a racist (42%)
  • Want to use an economic collapse or terrorist attack as an excuse to take dictatorial powers (41%)
  • Is doing many of the things that Hitler did (38%).

Even more remarkable perhaps, fully 24% of Republicans believe that "he may be the Anti-Christ" and 22% believe "he wants the terrorists to win."

Now, before you dismiss this as unimportant, go back and read all the numbers again.  These are the opinions of a large number of people in our country.

Even those who oppose Obama's policies would have a hard time finding any evidence that substantiates any of these 'beliefs'.  Formally, most Republicans dismiss these as extreme views.  However, I don't think that Republican leaders do enough to denounce these beliefs.  Don't get me started on the role of outlets like Fox News in beating these drums.  And, these views are leading to threats and violence as we have seen in the response to the passing of the healthcare bill.

Many of my right-leaning friends make jokes where some of the views above are the punchlines.  I'm a believer in humor and am the last person to preach censorship.  But, with so many people in our country thinking these extreme things about President Obama, I worry that we are approaching a tipping point where another Timothy McVeigh type of incident could occur.

And, the Tea Party fervor runs the risk of turning from speaking out to acting out.  Extreme falsehoods that are propogated to those who are ignorant of the facts can turn to hatred pretty easily.

So, rather than chuckling and dismissing claims that Obama is a socialist (check his income -- he's a capitalist) or, even worse, a Nazi, I'd like all of us to denounce and speak out against such rubbish.  If you think that the government is getting too big or has deficits that are too large, go ahead and shout from the rooftops.  If you want to rally to repeal the healthcare bill, go ahead.  Make your argument on the policy merits.  And, have the decency to believe that Obama's point of view is due to a legitimate different view of the role of government in our society or how to manage the government budget, rather than the work of a dictatorial racist Anti-Christ.

Hosting by Yahoo!

March 23, 2010

Healthcare Dust Settling

In the aftermath of President Obama signing the healthcare bill, I've been thinking about the healthcare debate.  Most of the discussion has been about non-issues (death panels) or things that most people agree on (don't mix up abortion policy with this healthcare plan -- stick to the Hyde Amendment).  Congresspeople dismiss the projections of their own Congressional Budget Office but can't point out where the analysis is wrong.  They just don't agree.

I think that Obama made a big mistake in leaving healthcare to Congress for 2009.  Congress is completely ineffective due to the polarized nature of politics.  There is very little compromise and very little bi-partisanship.  This has spiraled out of control since the early 1990s.

Since Obama didn't take charge of this at the beginning, he (and now we) are left with a bill that is far from perfect.  It's got a lot of the right ideas (everyone gets coverage regardless of pre-existing conditions, everyone needs to buy insurance so we can cover those who have pre-existing conditions, etc.).  But, it is overly complicated and has a long implementation period.  Things won't really change until 2014, after the next Presidential election (smart for Obama!). 

I wish that Obama had kept the US plan to be a scaled up version of the Massachusetts plan.  I've bought insurance for my family under this plan.  It was well organized and easy.  I was done in an hour.  Most of the time I spent was checking to make sure that our doctors were part of the plan I wanted.  The same private insurers are available in the market as before.  In fact, you don't hear anyone in MA complain about MA healthcare.  Even Mitt Romney likes it.  He should, it was his doing.  Romney thinks that each state should do what Massachusetts does.  The problem is that most states won't, leaving 10s of millions of people uninsured.

The MA plan hasn't broken the bank.  The latest numbers I've seen say that the state's contribution is 0.4% of the state budget.  And yet, one of our gubernatorial candidates says that it's bankrupting the state.  And, he's the current state Treasurer.  Guess math isn't his strong suit.

Romney figured this out:

Central to the plan was Romney’s recognition that uninsured individuals were costing the state and federal government money because they showed up in emergency rooms for non-emergency care. If they had health insurance, Romney concluded, those government payments to hospitals could be applied to paying to cover the uninsured.

“We said, let’s take the money that the federal government is giving us and that we’re taking from our own state coffers that we use to give to hospitals to give out free care,’ ” Romney says. “Instead, let’s use that money to help low-income people purchase their own private market-based insurance.”

I wish our new federal plan was closer to this simple idea.  Instead, Democrats in Congress overreached.  Some Congresspeople demanded that their states be paid off in order to secure their votes.  The Republicans encouraged irrational opposition irrespective of facts.  And, our debate turned into the Hatfields vs. the McCoys.  Opponents don't even know for sure why they hate the bill (or, their reasons are based on legend and not facts).  But, they know they hate it.

I hope that Obama leads with a heavier hand going forward.  He needs to control the debate and get Congress to follow in line.  He needs to keep reaching out to Republicans and let them decide if they want to collborate with him or stay as the party of No.  And, if he's smart, he'll adopt a couple of Republican-led issues as his own, as Clinton did with welfare reform.

And, let's hold all the news media and talking heads to some strict fact checking.  I appreciated the artilcle about Romney that I linked to before.  He rightly took credit for cracking the code on MA healthcare.  He pointed out where the Democratic legislature went against his wishes on some of the details.  But, he's willing to acknowledge that overall it's a good bill.  Sounds pretty darn bipartisan and reasonable to me.

Hosting by Yahoo!

Government Opression

More on the healthcare bill soon (hopefully later today).  But, I couldn't resist this picture this morning.  The 'this is the tipping point to get us to socialism' rhetoric is ridiculous.  Opponents said the same thing about Social Security and Medicare.  There is a reasonable debate to have about what level of social support the government should provide and how we should pay for it.   But, it's not reasonable to have all the inflammatory rhetoric we've had during this debate.  Is that what it takes to get people to pay attention?

Hosting by Yahoo!

March 05, 2010

Automated reply?

In my continuing series on what my government leaders say about the escalating cost of municipal healthcare in Massachusetts, here's the response from Governor Patrick's office.  Unfortunately, it seems like someone didn't read my message very clearly.  Both Bedford Town Manager Rick Reed and State Rep. Charles Murphy sent me very complete and thoughtful replies, as posted recently here.  However, Governor Patrick's office didn't read my note or handled it via some sort of automated reply.  The reply had to do with concern about overall insurance premiums (which I do worry about) and not this specific issue which has had a lot of press coverage lately.

Anyway, so no one can accuse me of playing favorites, here's the disappointing reply from Governor Patrick.  I did send a follow-up note to his office explaining what I was interested in.  Perhaps they'll send another reply.  Meanwhile, keep the pressure on your local officials to do something about this.  I'd be interested in some comments from readers about what you are seeing in your towns.  For example, a friend from Wellesley shared with me that Wellesley's problems on this issue seem to be even more acute than the average in the Globe article -- 18% of tax levy spent on municipal employee and retiree healthcare, and still rising fasat!

Reply from Governor Patrick's office:

March 5, 2010

Dear Michael,

On behalf of Governor Deval Patrick, thank you for your recent correspondence regarding your health insurance premiums. 

Responding directly to concerns from citizens and small business leaders, Governor Patrick has directed the Commissioner of Insurance, on an emergency basis, to require health insurance companies to file any increases or changes to rates before they take effect and to disapprove the increases if they are unreasonable or excessive.  Any increases significantly higher than the current level of medical cost inflation, which today is 3.2 percent, will be challenged.

            Some health insurance carriers will begin filing for rate increases on March 2, 2010 for an effective date of April 1, 2010.  While the Division of Insurance is reviewing submitted rates, policyholders must pay their premiums in a timely manner to ensure continued coverage.  If a rate is disapproved, policyholders will be notified by their health carrier of the disapproval and information regarding refunds, if any, of premiums already paid.  If you have any further questions regarding your individual rates please contact the Division of Insurance at 617-521-7794.


            Please feel free to contact our office with any future questions or concerns.  Your comments are always welcome in this administration.


                                                                  The Constituent Services Office

(617) 725-4005


Hosting by Yahoo!

March 04, 2010

My state rep weighs in

On my continuing march against the unreasonably high costs of health care coverage for municipal employees in Massachusetts I reached out to all my elected representatives as well as the Town Manager of Bedford.

Tonight I heard from my state Representative, Charles Murphy.  Murphy is also the Chairman of the Massachusetts House Ways and Means Committee.  His entire response is copied below.  I appreciate that he has been monitoring this issue for some time.

The most important part of his response is the frustration that I sense that the cities and towns are looking to the state to solve a problem by mandate that they can't solve themselves.  Since Bedford has been able to deal with this, I think that all other cities and towns should find a way.  What may be needed is the state setting the standard to let the cities and towns take stronger action, such as adjusting health plans without collective bargaining.  Although a state law would be helpful, it seems like we also need stronger leadership in many of our cities and towns.

Overall, I appreciate the detailed and thoughtful response from Rep. Murphy.  I'm happy to share it with you.  It's also been nice to see that many of my friends are now researching the situation in their own city or town in Massachusetts in order to pressure officials to take action on this matter if they haven't already.

Response from Rep. Murphy:

Dear Mr. Feinstein, Thank you for your email regarding the effects of rising health care costs on municipal budgets.  Hearing the views of my constituents enables me to make more informed decisions, and I appreciate your input regarding this issue. I also read with great interest the two-part Boston Globe report you reference in your email.  While this topic is not new to me, I think the Globe’s in-depth coverage will draw great attention to the issue in the weeks and months ahead.  As State Representative for the 21st Middlesex District, (Burlington, Bedford, and part of Wilmington) and Chair of the House Committee on Ways and Means, I work closely with a great number of local officials who are struggling with budget shortfalls as a result of rising health insurance costs. 

While not insensitive to their plight, I find it telling that cities and towns now look to the legislature for solutions to what most would admit is partially a self-inflicted problem.  I think the second part of the Globe series detailed the escalation of this problem well.  Cities and towns bare much of the responsibility for drastically increasing their premium contribution rates, for agreeing to plans requiring low or, in some cases, no copayments, and allowing some individuals serving very few hours to qualify for health insurance.  While yearly health insurance cost increases are easy to focus upon, I think the report gave some historical perspective as to how we got to this point.

The example used to kick-off the Boston Globe series details a 42-year-old woman, an eight year employee of the City of Everett, receiving health insurance for life because she was terminated by an incoming mayoral administration.  This unusual retirement benefit is allowed by Massachusetts General Laws Chapter 32, Section 10.  Earlier this session the legislature voted to eliminate all elected officials’ ability to collect an enhanced pension under this section, believing that the original intent of the law had been exploited by some individuals over the years.  There have been subsequent discussions of scrapping this law in its entirety.  

Outside of the above provision, retirement benefits for city and town employees should be commensurate with time served.  It takes 10 years to be eligible for a pension, and then the actual pension amount is a function of years served and age at retirement.  As noted in the first Globe story, municipal and state employees cannot qualify for a pension until age 55.  Pension payments for employees who only work 10-15 years are extremely modest, and these payments are even less if the employee is retiring before age 65.  As the Globe series points out, it is not the pension payments alone that weigh on a municipality, but the health care costs that come with it.  One possible way to address this issue would be to raise the number of years an employee must work to qualify for health insurance coverage or a pension.

In your email you also suggest that when an employee leaves municipal service, other than severance benefits, employees should not get continuing health care coverage before retirement age.  While I addressed the health benefits and retirement in the two paragraphs above, I should also note that public employees do not receive any sort of severance package when dismissed from service, regardless of years served or reason for dismissal.

To your final point, about requiring municipalities to enroll all retirees in Medicare, the legislature granted towns this ability in 1991.  I only wish the Globe piece had asked each of the local officials spotlighted in the report why their communities had not yet moved their retirees to Medicare.  I think an honest answer would have been reveling.  Presently cities and towns already have this ability; they seem to lack the desire to achieve these savings, therefore a statewide solution may be necessary to accomplish this initiative.

Again, those of us in the legislature are not insensitive to the plight of local municipalities, regardless of whether or not they contributed to their present situation through past actions.  Over the past year, the House and Senate convened a municipal relief working group to examine ways to aid communities during this financial downturn.  The commission issued a report, the recommendations of which were recently reported favorably by the Joint Committee on Municipalities.  In a similar regard, the House appointed a special committee of members to look at ways to reform the pension system in Massachusetts.  The findings of this report were the basis of a pension reform bill passed earlier this year, and could spawn further legislation this session.  Given the economic times that we now find ourselves, I think government at all levels should be looking for new and innovative ways to deliver necessary services.  Please know that I will continue to work with our local officials to find solutions to the issues raised in your email.  Ensuring that both our state and local governments are good stewards of the taxpayers’ money is necessary in the best of times; this need is only amplified during times like these.

I greatly appreciate your informed opinions and well thought out input on this subject.  Thank you again for taking the time to reach out to me.  If you need any further information or assistance, please contact my office at 617-722-2990.

Kindest regards,

Charles A. Murphy
House Committee on Ways and Means

Hosting by Yahoo!

March 02, 2010

Bedford - A good example

As part of my recent ranting about the escalating costs of health insurance for our Massachusetts municipal employees and the state and local governments' inability to do anything about it, I contacted the Richard Reed, Town Manager for the Town of Bedford where I live.  In about 24 hours I received a personalized, thoughtful and detailed reply about where Bedford stands on this issue.  And, the reply was sent at 11:15 PM!  I copied the entire reply to the end of this post, but here are the highlights.

  • Bedford has worked hard with its unions to keep health care costs more manageable.  Health care costs for all town employees comprise 7.9% of the town budget vs. the 14% in the Boston Globe survey.
  • The details are in the full email, but for its HMO plan, Bedford pays 68% of the insurance premium vs. the 80-90% that most other towns pay.  This is slightly below the average in the private sector.
  • As Bedford is a small town, we have very few elected officals who are compensated.  Most of the elected positions are unpaid or only eligible for a small stipend.  No former elected officals in Bedford receive health benefits.
  • Since the state allowed it 5 years ago, Bedford has required retirees to go on Medicare instead of being covered by the town plan.
  • Although it still has an unfunded health care liability of $62M, Bedford has started putting money aside to fund this which is one reason why it has the highest possible bond rating (AAA).
  • Mr. Reed agrees with me that a state law should be passed that allows cities and towns to change its health insurance plans without being subject to collective bargaining, as long as the benefits don't drop below what the state offers its employees.  This law is going nowhere in the legislature and is one that every Massachusetts citizen should be calling their state senators and representatives about.

I was impressed with the timelinees and professional nature of Mr. Reed's response to me.  Of course, as a citizen, I should expect this level of response, but we've all been conditioned to expect much worse from our elected officials, unfortunately.  More importantly, Bedford's example shows that it's possible for a town to strike a reasonable deal with its unions and to force municipal retirees onto Medicare.  Officials from other towns should follow this example to get their financial houses in order.

As a Massachusetts taxpayer, I am still going to focus on this issue with my state legislators.  Although Bedford is in relatively good shape, if other towns go bust, the state will end up bailing them out.  We need to get ahead of this issue.

The full text of the email I received from Richard Reed, Bedford Town Manager:

Good evening, Mr. Feinstein –

I have read the articles that appeared in the Boston Globe yesterday and today.  As is to be expected, an article about municipal health insurance programs, when taken from a state-wide perspective, paints a negative picture.  Taken from the individual perspective of this Town, the picture is much better as follows:

The article states that many municipal health insurance programs cover 80% to 90% of premium costs and that the average in the private sector is about 70%.  In Bedford, family coverage for our HMO plan (a restricted network) is 61% and individual coverage is 83%; when the premium dollars are combined, the average for the HMO yields a 68% premium contribution from the Town.  We also offer a PPO plan that gives the option to employees to go outside of the network; the PPO plan is covered at 50% of the premium for both individuals and families.  When employees go outside of the network, they must pay 20% of the cost for the service provided.  Bedford does not offer its employees and retirees a traditional indemnity insurance plan; employees who want the freedom of choice must opt for the PPO plan and absorb the 20% co-pay if they go out of the network.  In sum, Bedford’s contributions are less than average, even in the private sector.  As a percentage of the overall operating budget, health insurance will be 7.9%, as compared to the 14% average referenced in the Boston Globe article.

Contrary to the experience in other municipalities, no former elected officials receive health insurance from the Town.  This is due in part to the fact that the Selectmen are the only elected officials in Bedford who receive a very minor annual stipend for their service.  In order to receive heath insurance as a retiree in Massachusetts, you must have been compensated and be eligible for retirement.  Since most of Bedford’s elected officials are not compensated, the majority cannot qualify for retirement health insurance benefits.

The Town of Bedford accepted the Massachusetts law that forces retirees off the Town’s health plan onto the Medicare program.  This decision was made approximately 5 years ago and has resulted in avoiding the substantial expense of carrying these retirees on the regular Town health plan.

All communities are now required under governmental accounting standards to show on their audited financial statements what their unfunded liability is.  Bedford regularly reviews its post retirement health benefits obligations, but had a practice of doing so much earlier than the effective date of the requirement.  As mentioned in the article, very few communities (Wellesley, Needham and Boston) out of the 351 cities and towns in Massachusetts have begun to address this liability.  For some reason they did not mention the one or two other communities that are doing this.  Bedford is one of the communities that have begun to address this.  In fact, we have more than $2 Million set aside for this future liability in a trust fund.  There is still a quite a distance to go in this regard because the Town’s last study showed a liability of about $62 Million, without applying the $2 Million already set aside.  Adjusting for the fact that we already have $2 Million set aside, our liability would be reduced several million over time.  This matter of continuing to address this liability is something that current Town officials discuss quite often.  In fact, at this year’s Annual Town Meeting, another $150,000 will be appropriated towards the liability, assuming voters approve.   This may not seem like much, but Bedford is probably ranks first in the state in terms of the percentage of the liability funded.  This progress made by Bedford is one of the reasons that the Town’s municipal bond rating was upgraded to AAA (the highest possible rating) a few years ago.

Since 1981 when Proposition 2 ½ came into effect, Bedford has never attempted a general override to raise additional tax revenue.  Thus, until at least this point in time, we have been able to avoid a need to increase property taxes over the Prop 2 ½ limit for the purpose of covering health insurance expenses.  We are actively looking at ways to minimize the increases of health insurance costs and hope to continue to be successful in that regard.  Of course, the cost for health insurance continues to rise nationally and all governments and private employers are challenged by this circumstance.

The one thing that would be most helpful to Massachusetts municipalities like Bedford would be for the Massachusetts legislature to change state law so as to allow local governments to make changes in co-pays and deductibles without having to bargain the changes with unions.  The state government is free to change these items without bargaining with their unions.  Private business is not regulated in this regard.  Why shouldn’t local governments be given the same ability?  I see on your blog that you do agree and that you have contacted our state senator and representative encouraging them to grant this authority to local governments.  Such legislation has been proposed for a few years now, but not approved by the legislature.  If more like you would let them know what you think, hopefully they would listen.

Lastly, on your blog you mention the possibility of union’s striking.  Strikes in the public sector are illegal in Massachusetts.

In summary, I do think that health insurance benefits are at a reasonable level in Bedford; that being said, my senior staff and I continue to work to keep these costs in check.  I hope you find this responsive to you message.

Very truly yours,

Richard T Reed

Bedford Town Manager    

Hosting by Yahoo!

March 01, 2010

Keep the pressure on

As a follow-up to my torches and pitchforks post yesterday on the runaway health care costs that are likely to bankrupt Massachusetts cities and towns, here's the conclusion of the story in today's Boston Globe.  This article talks about the political issues involved in changing these laws, as well as the history of how we got into this mess.

The problem started when health care costs were relatively low.  Giving health care benefits seemed like a nice perk for municipal jobs, and the costs were not prohibitive.  Later, the state set some limits on how much of the premium a town could pay, but this limit became the benchmark for unions to reach.  And, at some point, health care benefits became retirement benefits, but they kicked in after 10 years of service and, unlike pensions, were fully paid and could start being used as soon as someone left their job and not at age 55.

These changes largely came during collective bargaining between the towns and unions.  As budgets get tight, these negotiations get tougher, and gains won long ago are tough to give back.  But, it's time for the unions to take ownership for fixing their fair share of our cities and towns fiscal problems.  One first step would be for the unions to agree to let their municipal employees join the state insurance plan, GIC, as Governor Patrick has proposed.  The Globe article details the savings, and the GIC plan is still very generous compared to insurance plans offered by private employers.  There's no hardship there.  Just reality.

The article also mentions that there are some bills in the state legislature that are attempting to clamp down on this, including letting cities and towns make changes to their health insurance without going through collective bargaining.  This seems like a great idea if the unions are not reasonable.  But, these bills seem to be unlikely to pass.  So, find out who your state represenative and senator are and send them an email.  I did this last night, and was happy to find that Governor Patrick has made this change part of his plan to get the cities and towns healthier.  We need the legislature to do something about it.  If not, I'm all in favor of voting them out.  I hope you are listening Senator Fargo and Representative Murphy!  (they represent me in Bedford).

I consider myself a left-leaning independent.  Some may call that a Democrat, but strong sympathy for unions is something that Democrats believe in that I don't.  I think that unions have a place, and certainly in the early 1900s they were essential to get good working conditions for employees.  But, now unions and management have such antagonistic positions that they are counterproductive.  It's particularly tough for municipal employers.  If they take a hard stand against their unions, they could have police, fire fighters, and teachers striking.  That's quite unpopular.  So, these unions need to show some leadership by helping their employers manage their costs to keep their jobs secure for the long-term.  It could be a fair bargain to promise some higher level of job security in order to get these costs under control.

Would you be willing to let these municipal employees go on strike in order to force the issue on health care costs?  That could be pretty chaotic, but unless the legislature can break the unions' positions on this, we may have little choice.

Hosting by Yahoo!

February 28, 2010

Get the torches and pitchforks!

OK, this issue gets me mad enough to riot in the street.  I read Runaway health costs are rocking municipal budgets in today's Boston Globe.  If you live in Massachusetts, you have to read this article.  It describes how our municipal employees are getting extraordinary health care benefits.  Many employees get lifetime health care for themselves and their families after working as few as six years.  Some towns don't force their retirees onto Medicare at age 65, carrying their health care costs on town books instead.

The combination of longer lifespans, skyrocketing health care costs, and these generous benefits are driving up the share of municipal budgets that are taken up with health care.  The average town surveyed by the Globe has had their health care costs grow from 8% of the budget to 14% in the past decade.

Now, anyone running a business or buying their own health insurance knows that costs have gone up.  You can't blame the cities and towns of Massachusetts for the overall rising costs of health care.  But, municipalities in Massachusetts are constrained in increasing property taxes under Proposition 2 1/2.  Cities and towns have had to learn how to live with constrained budgets which is, overall, a good thing.  However, one thing that hasn't been wrung from budgets are overaly generous health care benefits.  These health benefits are forcing cities and towns to cut essential services like police, fire, and education.

I can see the point of having generous health care benefits for municipal employees during employment.  These jobs are generally not high-paying positions.  Generous health care benefits can be a nice perk.  I can even understand why someone should have some continuation of benefits as part of a severance package if they leave under certain circumstances.  But, these should be limited and in line with the time of service.  A very long serving employee who is let go through no fault of their own deserves some severance.  But, not for life!

And, what's the justification for continuing to cover retirees on the municipalities books beyond age 65?  That's what Medicare is for, and we all pay for it already.  Instead, these retirees are getting gold-plated benefits at the expense of hiring other employees like teachers.

Even worse, some towns have huge unfunded liabilities for health care.  The total for Boston is $5.7B!  How do they fix problems of this size without raising taxes (very limited opportunity for this under Proposition 2 1/2) or continuing to cut essential services like police, fire, education, libraries, trash collection, etc.

The worst example: The widow of a Lynn police officer who retired on disability in his 30s in 1953 is still receiving city-subsidized insurance - 57 years later.  This police officer couldn't have had more than about 15 years of service.  But, his widow gets health insurance for 57 years!  Wow!

What to do about it:

  • Pass a new state law that limits retirement benefits for municipal workers to something proportional to time served.
  • Other than severance benefits proportional to time served, no continuing health care benefits should be allowed for municipal employees who leave their job before retirement age.
  • Require municipal retirees to go on Medicare at age 65.
  • Void all elements of current collective bargaining agreements that contravene these measures.

This might be seen as draconian by some, but the State has an interest in regulating this.  First of all, the State provides local aid to cities and towns.  That money will get consumed by overly generous health care benefits unless regulations like these are in place.  Second, the State will end up bailing out cities or towns that go broke under the yoke of these benefits.  Therefore, they have an interest in cutting this waste.  And, third, it may take forever for each city and town to wrestle with these issues on their own.

I'm going to send a note to the Governor's office and to my state senator and representative about this.  Find out who yours are here.  I'm also going to find out how much my town, Bedford, is paying for these types of benefits and whether we require retirees to go on Medicare at 65.  I urge you all to do the same.

Thank goodness the Boston Globe is still in business.  Who else is going to do this type of local investigative reporting?

This one is worth rioting in the streets over!

Hosting by Yahoo!

September 11, 2009

Something else we've lost since 9/11

Everyone's thinking back to 9/11/2001 today.  Hard to believe that 8 years have passed.  As is the case with many people in Boston and New York, I know quite a few people who lost family members and friends during that tragedy.  It's hard to forget the feelings of fear and helplessness that we all had then.

The other thing I remember was how the whole country came together in the wake of the tragedy.  It was America at its best.  People stepping up to help out in any way they could.  We all united behind President Bush, including those of us who didn't support him.  The very large majority of the rest of the world also supported us.  I worked at a transatlantic firm in 2001, and I remember the heartfelt words of support we received from our European colleagues.  It made the world feel smaller and closer.  Unfortunately, in the US we've lost that feeling of pulling in the same direction.

I am all for vigorous debate on the issues.  Health care reform is a huge change.  Although I generally support President Obama, I have concerns about health care reform -- I am worried about how we will afford to cover everyone and how we will stop the rapid growth of health care costs.  But, the debate has been about death panels, funding abortions, health care for illegal immigrants, etc.  None of these points are in the bill.  If there are loopholes in the bill that cover these, then let's debate those.

But, when the President addresses these matters point blank to Congress and is called a liar by a member of the House, that's way too far.  And, when that House member then tries to raise money based on this improper behavior, it shows that we've lost our way. 

Even scarier is what I heard on Fresh Air yesterday.  The hatred and lies that these far right wing lunatics spew is thinly veiled racism.  The fact that they have a large audience should scare all of us.  We'll never get anything done here without fact-based political debate.  And, the hate-filled anarchistic vitriol in the name of 'America' is what fueled the biggest terrorist attack in the US before 9/11, the Oklahoma City bombing.  It's the furthest thing from the tolerance that is the basis of American freedom.

We should all speak out against this type of slanted lie-filled lunacy.  And, set an example by engaging in a fact-based debate on the issues.  Thank goodness I live in Massachusetts where even the Republicans are reasonable!

Hosting by Yahoo!

August 27, 2009

Personal Touch

I spent a lot of time yesterday thinking about the passing of Senator Ted Kennedy.  He was elected to the US Senate when I was 1 year old and had always been a visible public figure in my life here in Massachusetts.  Whether you agreed or disagreed with him philosophically, whether you forgave or were horrified by his personal troubles, there was no doubt that he cared deeply about the people he represented.

I am always most moved by the Ted Kennedy stories where he put his own time into helping or comforting some 'regular' person.  He wasn't doing this as a quid pro quo for a donor or political ally.  He wasn't doing it for the press coverage as there was usually none at the time.  He didn't brag about it later in speeches.  He just did it because he thought it was the right thing to do.  This personal empathy for his constituents is an important lesson for all of us.  So few leaders exhibit tihs quality today.

Here are two stories from today's Boston Globe which highlight this aspect of Senator Kennedy's life:

His compassion lifted many

A man who knew pain eased it in others

And, a couple of quotes from the second one:

There was no use arguing.

It was Aug. 18, 2008. The senator read in the paper that two servicemen from Mashpee had died in Iraq and Afghanistan. He knew their grieving families would be together that afternoon, gathering for sandwiches and fortitude before a candlelight service at Mashpee’s veterans memorial.

It didn’t matter that he was in the middle of yet another chemotherapy treatment at Massachusetts General Hospital. It didn’t matter that he was clearly exhausted. It didn’t matter that people would understand if he couldn’t make it. He wanted to be with them.

“When you think it’s the moment not to call, that’s the moment to call,’’ he always told his aides. “The sooner, the better.’’ He wanted the relatives to know he was there if they needed him and to tell them he had lived their pain.


The ailing senator was in no hurry to leave. He had words of comfort for every person in the house that afternoon.

“It gave me great admiration for him,’’ Maria Conlon said, “that somebody going through such a hard time with his own life, and for everything he’s suffered in the past, and still, he took the time to go to the family’s house, to sit there, not for five minutes, but for hours.’’

He wanted to attend the candlelight service, he told the families, but it was best for him to stay away.

“If I go, I’ll be in the spotlight,’’ Vicky Baron, Paul’s aunt, recalled him saying. “I don’t want to take away from what these young men did and what they gave up.’’ 

And so the senator hugged the grieving families goodbye and left the house, unseen.

I find these types of personal connections inspiring.  They remind me that in everything we do, it pays to take the time to have a personal touch.  I've done a bunch of fund-raising for various charities.  In looking back, the approaches that have worked the best have been the phone call, the in-person meeting, and, the most effective of all, the hand-written note.  Taking the time to write something by hand in this era of word processing and email and Facebook and Twitter shows a real commitment to the cause and to the recipient.  Personal commitment elicits a response, whether it is from donors, customers, partners, or investors.

If Senator Kennedy had the time to do this, we can all find the time.  It's a matter of putting our time into what's important.  And, a personal touch is one of the most important things of all.

Hosting by Yahoo!

August 21, 2009

Fake news, real discussion

I love The Daily Show.  We went to see it being taped back on August 3rd.  It was incredible to see how they do the whole show in just one take, breaking only for commercials.  At the show we saw there was no editing and no re-takes.  They got it right the first time, with impeccable comic timing.

But, even more impressive is that Jon Stewart can actually have an intelligent discussion with a guest, with comedy mixed in.  Last night, he had Betsy McCaughey on the show.  It was her op-ed piece that started the 'death panel' ruckus, although she never used that phrase.  Instead, she said that the health care bill called for "euthanasia for the elderly", which is not true.

Jon Stewart does a great job interviewing her.  The interview ran long for the show, but is captured in three parts on the web site.  It's worth watching.  It also makes me long for more meaningful discussion of these issues on real news shows.

Part 1

Part 2

Part 3


The Daily Show With Jon StewartMon - Thurs 11p / 10c
Betsy McCaughey Pt. 1
Daily Show
Full Episodes
Political HumorHealthcare Protests
The Daily Show With Jon StewartMon - Thurs 11p / 10c
Exclusive - Betsy McCaughey Extended Interview Pt. 1
Daily Show
Full Episodes
Political HumorHealthcare Protests
The Daily Show With Jon StewartMon - Thurs 11p / 10c
Exclusive - Betsy McCaughey Extended Interview Pt. 2
Daily Show
Full Episodes
Political HumorHealthcare Protests

Hosting by Yahoo!

August 19, 2009

Tax holiday, not math holiday

For the first time since I was a kid, I wrote a letter (or email) to the newspaper today.  Today's Boston Globe had an editorial entitled "Let retailers host tax holiday."  Although I agree with the general sentiment that the state should allow retailers to pay the tax on the part of consumers if they want to, the editorial got the math wrong.  As a long-time math geek, I couldn't let this one pass.  My email to the Globe:

In today’s editorial, “Let retailers host tax holiday”, the Globe got the policy right but the math wrong.  I am in favor of allowing retailers to pay the sales tax on the part of the consumer.  But, for this to be revenue neutral to the state and the consumer, the math doesn’t work.


If an item is sold for $100, there would normally be a $6.25 tax charged by the retailer and sent to the state.  The consumer is out $106.25, the retailer makes $100, and the state gets $6.25.  If the retailer wants to ‘pay the tax’ on the part of the consumer, they would charge the consumer $100, but what do they send to the state?


If they send the state $6.25, that implies that the item cost, without the tax, was $93.75 (a 6.25% discount).  That would normally mean that $5.86 in tax would be charged, for a total consumer cost of $99.61.  So, the retailer would be overcharging the consumer 39 cents and passing this on, in full to the state.  That keeps the state revenue neutral, but overcharges the consumer.  And, the consumer would pay a total of $100 vs. $106.25, a 5.88% discount (not 6.25% as was incorrectly calculated in the editorial).


An alternative would be to charge the consumer $100 and send the state $5.88.  This reflects an underlying item cost of $94.12.  The $5.88 is 6.25% of this.  This is neutral to the consumer and would reflect a 5.88% discount.  However, the state loses $0.37 or 5.92% of the original tax revenue.  This is probably what you meant when you said ‘have the retailer pay the tax’, but will cost the state some money (but nowhere near as much as a state tax holiday).  In these tough times, the state probably can’t even afford this.


To keep the state and consumer neutral and have the whole thing funded by the retailers, the best idea would be to keep the item price at $100, charge the consumer $106.25 total, including the $6.25 sales tax, and do an after-the-fact rebate of $6.25 to the consumer.  The state gets their full $6.25, the consumer only pays $100 net, and the retailer ends up with $93.75.  No law needs to be changed or passed for this to happen.  It’s not clear that a 6.25% rebate would be attractive to consumers, but that’s the one that makes the math work.


The bottom line to all of this is that to undo a 6.25% mark-up (our sales tax), you only need to take a 5.88% discount.  Perhaps it’s this confusion that caused our elected representatives to take a voting holiday on this issue.  Let’s hope they spent the time studying arithmetic.




Mike Feinstein



It's a fine point, but somehow or another, retailers have to report their sales and tax payments to the state.  So, the math has to be right.  And, basic math seems to elude even well-educated editorial writers at times.

Hosting by Yahoo!

August 12, 2009

Just debate the facts

President Obama is committed to making changes in our healthcare system.  We have a huge problem as a nation where healthcare costs are spiraling out of control.  This is slowly strangling our economy as one way or the other, we all pay for our healthcare costs.  If you get your healthcare through work, then the customers or financiers of your employer are paying the bill.  If you buy your own healthcare, as I do currently, you are obviously paying directly.  And, if you have no healthcare, you are either probably depriving yourself of care you may need to keep you from endangering the rest of us, or you get care for free through some mechanism that is indrectly paid for by taxpayers.

So, I don't think anyone argues about wanting to lower the cost of healthcare.  But, there is a lot of disagreement on how to do it.  I'm no expert, so I'm not going to discuss this.

The second issue is coverage.  Most people in this country get healthcare through their employer.  If you don't have a job, or you don't have a job that includes healthcare benefits, you have to either buy insurance yourself or go without.  The government already insures our oldest citizens and some of our poorest through Medicare and Medicaid.  Since we all end up paying for the cost of our healthcare one way or the other, it makes sense to get as many people as possible insured.  But, it's not clear how to do that.  And, it seems to me that it would be desirable to make sure that if someone is insured that their insurance actually covers them without kicking them out when they get sick or if they had a pre-existing condition.  This aspect of reform seems to be the least controversial, but we'll see.

I don't know much about healthcare policy, but I do know that we'll never get anywhere unless we debate the facts.  Instead, a lot of opponents of the reforms being debated in Congress have resorted to ridiculous lies and distortions rather than attacking the actual facts of the proposals.  I am sure that there are weaknesses in the proposals being discussed in Congress.  But, the issues of the so-called Death Panels that will decide when your grandmother will be killed, the insuring of illegal aliens, or the forced government-funded abortions are scare tactics.

The Boston Globe today had an article that addressed the distortions and discussed what is really in and not in the bills being debated.  This article is consistent with other analyses I've seen that look at the facts.  These proposed policies are certainly subject to disagreement, but let's avoid distortion.

You might expect so-called pundits on TV to spout ridiculous distortions.  But, when people who consider themselves statesmen and stateswomen do the same, it's shameful.  I'm not sure what they hope to gain.  Didn't they see that Obama won by pulling in the middle?  Fear-mongering may rally the far right (in this case), but it will push away the middle.  If the Republicans want to regain some momentum, I think that they should abandon their extreme base and take the high ground on policy, ethics, and fiscal conservatism.  The middle will be the first part of the country to move away from Obama if he doesn't meet their needs.  But, the Republicans aren't giving them any place to go.  And, with ridiculous distortions, they'lll just be left to yell at themselves.

Hosting by Yahoo!

July 16, 2009

Still bailing

In light of the huge profits announced by Goldman Sachs and JP Morgan, I continue to feel that we've been taken for a ride by our Treasury Department (under both Paulson and Geithner).  They rushed through big bailouts for these banks, and these banks were probably in trouble.  But, if you believe Elizabeth Warren (she heads up the Congressional panel that is overseeing the bailout), we're continuing to subsidize these banks.

First, her team's analysis showed that the initial bank investments we all made were done at a 34% discount.  That means that the moment that the money was transferred from the US Treasury to the banks that we lost 34%.  This was before any stock moves up or down, etc.  We just gave them a bunch of free money and didn't get enough value back in return.  Keep in mind that we made these investments at a 34% discount AFTER their stocks had already dropped alot due to investor fears.

Now, the banks are repaying the money and looking to buy back the warrants that they issued to the government.  These warrants were our 'upside' to reward the taxpayers for being the bailer-outer of last resort.  According to what I heard on NPR's Hear and Now yesterday, Elizabeth Warren now also estimates that the government is selling back the warrants to these successful banks at a 34% discount.  No wonder these banks have such huge profits so fast!

I'm glad that the banks are healthy.  There is no doubt that they have returned to health due to the large government bailouts, including money paid to AIG that went right out to banks such as these as part of AIG's obligations.  But, with such financial health, we shouldn't be cutting our share of the upside.  We need people in the Treasury who hold the line for taxpayers.

I'm glad that Ms. Warren is so outspoken.  You can find her on all kinds of shows, including this two part interview from The Daily Show (Part 1 and Part 2).  Let's hope she keeps it up.


The Daily Show With Jon StewartMon - Thurs 11p / 10c
Elizabeth Warren Pt. 1
Daily Show
Full Episodes
Political HumorJoke of the Day
The Daily Show With Jon StewartMon - Thurs 11p / 10c
Elizabeth Warren Pt. 2
Daily Show
Full Episodes
Political HumorJoke of the Day

Hosting by Yahoo!

June 01, 2009

Nothing Like Building Stuff

Today, Boston-Power announced that it plans to build a state-of-the art battery manufacturing facility in Auburn, MA, near Worcester.

Like many companies these days, Boston-Power has applied to the federal government for a grant of about $100M to help build the factory.  The facility would be used to build a new product, Swing, to be used in hybrid electric vehicles.  If the federal government is going to spend money to subsidize industry, this is the type of thing the taxpayers should be funding.

First of all, we need new batteries to power hybrid electrc vehicles.  These vehicles lower our dependence on imported oil.  And, we need to build these batteries in the US to be close to US manufacturer supply chains.  Also, we can export these batteries to international manufacturers.  Lastly, Boston Power plans to hire 600 people at a factory in central Massachusetts where new jobs are generally lacking.  Getting good jobs building stuff is a key to our economy.

We need to continue to develop new technology that we can manufacture here and export elsewhere.  It's so much harder to solve our employment problems with service jobs, which generally are lower paying.  Instead, our economy needs to find high-margin, innovative products that we can build here.

One key part of building them here is that the rest of the supply chain needs to be here.  Boston-Power also manufactures laptop batteries, including supplying batteries for the HP Enviro Battery.  But, these batteries are manufactured in Asia to be close to the rest of the laptop supply chain.  Even if we could build laptop batteries more cheaply in the US than in Asia, you'd lose money shipping the batteries from the US to where the laptops are built.

Let's hope Boston Power is awarded these grants so that we can start to build more high-tech stuff in the US (and Massachusetts).

Disclaimer: I was a board member of Boston-Power for several years and am currently an advisor to the company.

Hosting by Yahoo!

May 05, 2009

Be True to Your Brand

As a marketeer at heart, I spend a lot of time on positioning.  Every product and every service has some sort of market positioning.  Companies try to define it for themselves, but it ends up being a combination of your own marketing efforts and the response of the marketplace.  You can keep telling the world that you have a premium product, but if the customers' experience doesn't match that, your image in the market will be tarnished.

I was fascinated to read Fred Wilson's American Express Blues a few days ago.  You should go there and read it, including the comments.  Fred has a lot of active commenters on his site, which makes an incredible conversation.

Fred describes his experience with Amex.  He, his various funds, and his family have Amex cards.  He's been a 'Member' for 26 years and never had a late payment.  However, one of the funds (Flatiron) paid an Amex bill late.  And, Amex shut off ALL of his cards without notifying him.  Here's my favorite part:

When I called American Express to figure out what was wrong with my cards in the middle of the Flatiron situation, I was told it was their policy to shut down all accounts if there was a late payment on an account. I asked if my 26 year perfect credit with them was material to the situation and I was told it was not. I hung up on them.

The comments on Fred's blog include person after person who has had a similar experience.  After being a good customer for a long time, something happens (which may be the customer's fault), and the response from Amex seemed very drastic.  For a company that tried to position themselves as an elite brand, they aren't treating their customers like the 'Members' they purport them to be. 

Nothing bothers a customer more than being betrayed by a brand that they bought into.  If you are a customer of a premium brand, you want to be treated like a premium customer.  You aren't surprised when the low-end retailer has poor service.  You shop there for the lowest price.  But, if you go to Nordstrom's, you expect fantastic service (and, since Nordstrom is successful, you almost always get it).

I've been betrayed by some brands over the years.  I tend to hold very long grudges against these companies.  The stories are so out of date that they aren't worth retelling here.  And, some of these brands have gone out of business (no surprise).  But, I won't do business with my own 'hate list' of brands in the future.

I decided to write this today after hearing a show on NPR yesterday about the future of the Republican Party.  The story there was the same from the Republicans on the show.  They had lost their way and gone against the fiscal bedrock of their party.  Since they weren't true to their brand, their voters aren't true to them.  I think that fiscal conservatism can and should be a strong force in the country.  But, between not sticking to that and expanding their message beyond it, they alienated a lot of old-time Republicans and failed to attract a lot of new ones.  They need to rebuild their brand, which should be interesting to watch.

For every entrepreneur starting a company, be sure that you can deliver on the implied promises that your brand is making to your customers.  If you do so, your customers will be loyal.  If you betray them, you are dead.

Hosting by Yahoo!

April 23, 2009

Sweeping Generalizations

One of the things I hate about politicians is that they almost always make a sweeping generalization when faced with an issue.  They'll take bold swift action and miss out on the nuance.  Here's the latest example:

There seems to be some corruption involved with placement agents who grant access to the NY State Pension Funds.  Bloomberg writes about it here.  The NY Attorney General has banned the use of placement agents that help funds get access to the states $121.9B pension fund.  It sounds like a good idea -- get rid of the intermediaries and remove a source of possible kick-backs.  But, it will actually constrict the access to those funds.  Most fund managers don't have direct contacts with the NY State pension funds.  They need to hire intermediaries who have those relationships.  That's not a problem.  The problem is if those relationships are misused.

So, rather than banning all placement agents, the government should require transparency when it's money is placed through placement agents.  I would name both the placement agent firm and the principals of that firm.  Then, political connections and donations would be apparent.  As I have mentioned before, I am not a fan of regulation that restricts activity.  Instead, I think that regulation should be focused on reporting and transparency.  If the information is available, the public can decide if there is a problem, or it can be checked by some oversight board.

By the way, avoiding sweeping solutions is important for entrepreneurs.  Too many times an executive will make a sweeping decision without understanding the nuance.  While appearcing decisive and strong due to the broad action, they may be making critical errors if they miss out on the nuance of the situation and how they should be taking advantage of it.

Hosting by Yahoo!

March 25, 2009

Maybe we need to quiet the angry mob

I've been as mad as anyone about the AIG mess and the bonuses paid to executives there.  Clearly, without our bailout money, there would be no money paid to anyone there, bonus or otherwise.

But, an op-ed in today's New York Times is giving me second thoughts.  The op-ed is a resignation letter from Jake DeSantis, an executive vice president in AIG's infamous Financial Products Unit to Edward Liddy, CEO of AIG.  In the letter, Mr. DeSantis describes his work in AIG's commodity division which had nothing to do with credit default swaps.  In fact, he says that "no more than a handful of the 400 current employees of AIG Financial Products were involved in credit default swaps and that most of those who were involved had already left the company.

Where Mr. DeSantis's letter gave me pause is when he described agreeing to work for a salary of $1 in addition to the promised bonuses, while turning down other more stable jobs.  It sounds like he's been working hard to sell off a division to UBS to generate cash needed to repay us taxpayers.  Although it's staggering to read that Mr. DeSantis's bonus, after taxes, was $742,000, it's also hard for me to say that he wasn't entitled to something that he had been promised multiple times and had given up his fixed salary for.  Certainly, this guy doesn't sound like someone who should be villified.  Perhaps we're just envious that someone who graduated from MIT in 1992 can make so much money at his job.  Never forget the value of a technical education!

The problem is that paying Mr. DeSantis to help raise cash for AIG is a sound business decision, but a poor political one.  In politics, the baby is thrown out with the bathwater on a routine basis.  The media hype drowns out the details and subtleties of a story.  Unfortunately, Mr. Liddy, the CEO of AIG, didn't have the ability to do what Mr. DeSantis did -- tell an individual story that changes how you look at a situation.  The only people at AIG that we really should be mad at are the ones who built up their credit default swap business, or others who took similar risks.  If we believe in capitalism, we have to let the rest of AIG run their business in the way they see fit so they can try to return some or all of our money.  Let's just send the angry mob after the bad guys, if we can figure out who they are.

Speaking of angry mob, Jon Stewart unleashed them last week.


The Daily Show With Jon StewartM - Th 11p / 10c
The Notorious AIG - Scorn in the USA
Daily Show Full EpisodesEconomic CrisisPolitical Humor

Hosting by Yahoo!

March 18, 2009

This guy's a glutton for punishment

AIG CEO defends bonuses as public fury mounts

I know that AIG needs to run as a business in order for the taxpayers to have a hope of getting something out of our $170B bailout (I refuse to call it an investment).  But, the CEO we brought in to run it should also have the guts to tell the management that they need to forego their bonuses to buy some patience from the taxpayers.  Giving in to their greed is what got us into trouble in the first place.

Hosting by Yahoo!

March 09, 2009

And there it goes...

See this post from Bailout Sleuth.

It details a report from a House committee on TARP oversight.  Here's some places where our bailout money has gone:

The transactions included a $2 billion repurchase by Goldman Sachs Group, Inc. of its own company stock. Goldman Sachs Group received $10 billion in TARP funds on October 26, 2008.

The subcommittee said it identified the questionable transactions through testimony from
Dow Jones & Co., the business information firm.

Also singled out for scrutiny were an $8 billion loan from
Citigroup Inc. to public sector entities in Dubai; a $1 billion investment by J.P. Morgan Chase & Co. in the development of cash management and trade finance solutions in India; and a $7 billion investment by Bank of America Corp. in a Chinese bank.

Hopefully now that there is more scrutiny on this, any bailout money that is given out will be put toward its intended use.  The transactions above just show that the 'urgent' TARP wasn't really so urgent to keep the US economy going.

Hosting by Yahoo!

March 02, 2009

Let The Chips Fall

Today, the Obama administration released the secret anti-terror memos from the Bush administration.  Nothing infuriated me more about the Bush administration than the trampling of our civil rights.  I fundamentally believe that we can fight a war and battle terrorism  without compromising the rights that make us free.  Having the government illegally eliminate our rights is a victory for the terrorists.

This quote from the article bothered me the most:

...following the Sept. 11, 2001, terrorist attacks, the Bush administration determined that certain constitutional rights would not apply during the coming fight. Within two weeks, government lawyers were already discussing ways to wiretap U.S. conversations without warrants.

This rapid move to attack our rights makes it seem that Bush was looking for a reason to trample on our civil rights.  I understand the need for domestic surveilance, but the FISA courts already provided a mechanism to get a rapid wiretap when justified.  Why was this one of the first things to consider?

I have mixed feelings about the level of prosecution we should pursue against Bush administration officials about potential illegal activites they engaged in.  On the one hand, I don't think that this level of illegality should go unpunished.  But, in light of all of the crises we have going on, do we really need months and months of explosive government testimony that takes our eyes off of other problems?  Maybe a Truth and Reconciliation Commission would be better.  Let's get all of the illegal activities in the open and shame those who committed them.  But, pushing further into criminal proceedings seems like it will take it that much further.

Maybe you can't separate the two.  All this happened so recently, and the Republicans will have a lot of political fallout if things are really as bad as it looks for the Bush era.  And, a lot of people are angry enough to put some folks away.  At least Bush didn't pardon everyone before he left office.  I give him credit for that.

The fallout from Bush's wrangling around the Constitution is going to have alot of fallout -- lawsuits, exposing torture, potential obstruction of justice from destroying evidence, etc.  In the end, we should let the legal chips fall where they may.  I love our system, despite its faults.  Let's let it work...

Hosting by Yahoo!

March 01, 2009

When Business Becomes Political

Fred Wilson wrote today about something I've been thinking about, too.

When the government becomes an investor in a business, that business becomes political.  We can't criticize a bank for advertising for new customers.  How else will they stay in business?  Why can't an insurance company reward its top salespeople with a trip?  That always motivated sales people before.

But, when these companies take our money, they become political targets.  Now, instead of a bank running an ad, it's like a government agency advertising on the front page.  Instead of the insurance company motivating its sales people, it's a political junket.  And, it's why Congress worries about the cost of an auto executive taking a private jet when we should be worried about how they'll spend the billions we are handing them.

I wouldn't want to be a politician.  I don't want to live under a microscope.  Most business people also don't want that level of scrutiny.  Unfortunately, they're getting it with the government bailout.  I really wish we could provide some level of support for the most crucial businesses without becoming an equity investor.  Too late for that now.

Hosting by Yahoo!

February 27, 2009

Someone has to pay

My friend, Angelo Santinelli, posted today about the Death of Incentive.  Angelo is rightly concerned about the increasing tax burden on entrepreneurs which may dissuade some from taking the risk of starting a new business.  Angelo was nice enough to ask for my thoughts on his post before it was finished and incorporated some of my thoughts in his final draft.

However, while I sympathize with Angelo's position and agree that we need to stimulate entrepreneurship and innovation as a way to revive our economy, I also worry about how our government can get back to a balanced budget.

It's well documented that Clinton left office with a large budget surplus.  Of course, this was also during the height of a huge economic bubble.  Bush had the bad luck of an economy that was certain to come back down to earth, followed by the further negative impact of the September 11 tragedy.  I can't blame Bush for these facts which, on their own, would probaby push the government budget surplus into a deficit.

However, Bush also pushed though big tax cuts, launched a couple of expensive wars, and provided no check on increased government spending.  A new financial crisis at the end of his terms has left Obama with unprecedented deficits with the spectre of a necessary financial stimulus piling on even more debt.  I remember when a $175B deficit was a big number.  This year, our deficit is TEN TIMES that at $1.75 TRILLION. 

I hate unbalanced budgets.  It's fiscally irresponsible and puts off the inevitable reckoning.  I agree that during these times of crisis, we need to run a deficit.  And, we can afford a certain level of deficit spending.  Maybe we can even afford a $1.75T deficit for this year.  But, we need to be on the path of balancing the budget.

Obama is saying that the deficit will be cut in half in four years.  But, cut in half from this year's number is nowhere near good enough.  That's still an $875B deficit.  We have to narrow the deficit much more than that within four years.

I am sure that Angelo and I agree that Obama is proposing to spend too much.  I am very sympathetic to Obama's priorities.  I'd love to spend the money he's proposing.  But, right now, we can't afford it all.  If we can't afford it, we shouldn't spend it.  I'd like to more drastically cut the deficit over the next four years.  I'd get half of it back by lowering the spending targets.  And, I'd get the other half back by raising taxes.

This is where Angelo and I don't agree.  No one likes paying taxes.  And, I've certainly paid my share.  But, I am still very well off, luckily.  I don't think that the tax rates deterred me from being an entrepreneur or a VC.  You have to make a lot of money to pay a lot of taxes.  And, it's only those who are relatively well off that can pay more taxes so we can lower our deficit.  As long as were really careful on spending, I'll be willing to do my share to pay some more taxes.  I agree that radically higher tax rates would be a deterrent.  We can't return to the 70% marginal rates that Reagan eliminated.  But, anyone who rails against a certain tax hike should have to propose some other tax hike in their place until we get our deficit under control.

I'd like to give Obama the target of getting the deficit down to $200B within four years.  This is still a big number, except in the context of the big Bush-era deficits.  Then, we should get to a surplus two years after that.  And, we may need to run a surplus for a while to pay off all the debt we've racked up in the interim.

One thing I do think, however, is that all Americans should have a bit of pain to get our budget balanced.  I don't want to raise the taxes much on the middle class, but they should pay a bit more.  If they had a $100 surcharge on their taxes for the year, they'd be part of the solution.  We're all going to have to sacrifice something to get our fiscal house in order.  All but the poorest of us can live more economically in some way.  Let's all pitch in, pay our share, and get back to fiscal sanity.

Hosting by Yahoo!

February 05, 2009

Walk In the Sunshine

It's not easy for President Obama.  He's trying to be bipartisan with efforts such as appointing three Republicans to his cabinet and lobbying Republicans to support his stimulus bill.  Of course, there is no way to escape partisan politics in Washington.  I hope he's successful, and I hope it's only Rush Limbaugh who hopes he fails.  I guess he didn't buy into McCain's America First approach.

One great thing about the Obama administration so far is the improved transparency.  They have video channels on YouTube, including one for the transition.  I don't know who really wants to watch all this stuff, but I'm glad it's there.  We need much more communication and openness from Washington than we have had in the past.  That doesn't solve problems, but it does improve confidence.

And, Obama has already admitted some mistakes, as he did about his selection of Tom Daschle while he was aware of his tax issues and, more importantly, his pseudo-lobbying efforts.  Everyone makes mistakes.  They aren't a sign of weakness.  What is weak is a failure to admit your mistakes and act to fix them.

Today Obama has an op-ed piece in the Washington Post to argue for his stimulus package.  Although I am in synch with Obama's long-term goals, I have some hesitation on the current stimulus package.  I think we should be rushing out a pure stimulus that is significant, quick, and short-lived to get the economy moving.  I'd like us to think through big projects of change to make sure we get them right.  However, I have to say that Obama's openness and style give me enough confidence to give him the benefit of the doubt here.  I like his appeal to the people as they are pretty hungry to do things differently.

Supreme Court Justice Louis Brandeis said "Sunshine is the best disinfectant."  We need all the cleaning up that we can get.

Hosting by Yahoo!

January 27, 2009

Managing Expectations

As I watched the inauguration of President Obama last week, I was struck with the contrast between the euphoria of the crowd and his measured and cautionary remarks.  Others have noticed this, too, and it took me some time to get around to writing this.

President Obama probably has, after FDR, the toughest set of circumstances facing him versus any other President.  Nevertheless, he has a 69% approval rating.  Given the difficult choices he'll have to make, he's bound to disappoint a good number of these people.

If you read his speech, you'll notice it to be relatively somber for a President coming in on such a wave of support.  And I think that's wise.  One of the biggest challenges for any leader is to manage expectations.

During good times, it's very easy to get overly optimistic.  And, during bad times, teams can get overly pessimistic.  A good leader can find the right balance to keep the team challenged and keep the company on a 'high-achievement' posture.

It's easy to understand the problems that can happen to when a management team gets overly optimistic.  This is very common among entrepreneurs as they tend to be optimists by nature.  Entrepreneurs visualize how to solve big problems and can't be deterred by the problems and issues.  Those 'why nots' are why other people haven't tried yet.  But, overly optimistic projections lead to disappointed investors and a lack of confidence in a team's ability to execute, even if they have actually done a great job.

However, sandbagging and setting low targets doesn't work either.  Whether through caution or pessimism, overly low expectations tends to lead to low achievement.  High jumpers don't clear the bar by feet, even if the bar is set low.  People tend to beat their targets, but it's hard to get a company to obliterate their targets.  And, the company's spending level tends to be set with an eye toward expected achievement.  If a company sets a $10M revenue goal, they'll spend commensurate with that.  However, if they could achieve $25M with the right plan, they won't have a chance of doing that with a spending plan that contemplated $10M in revenues.

The right balance that an executive should set is to 'under promise and over deliver'.  Targets should be set high enough to be challenging for the team, but not so high that they can't be met even with superhuman effort.  That's one reason why a CEO needs experience.  Without seeing this goal setting done well and poorly, a CEO won't have the ability to set the right goals for the organization.  And, if the expectations aren't set and managed well, the company is doomed to under deliver.

Hosting by Yahoo!

January 18, 2009

Out with the old wax

I love this photo today of Bush's wax figure being taken away at Madame Tussaud's Wax Museum, with Obama's figure looking on.  My countdown clock says just two more days.


Hosting by Yahoo!

January 15, 2009

Service Nation

I think that the election of Barack Obama has the potential be a real turning point for the country.  He's got a huge number of problems to address, and we all hope that he's successful in getting our economy back on solid footing, resolving the wars we are involved in, and re-establishing a positive image for the US in the world.

But, we also need to invest back in the US.  I am not talking about financial investment.  Some of us have the means of doing that, and some of us don't.  But, almost all of us has the potential to invest some time volunteering for a cause to make someone else's life better.  Doing this won't solve all of our domestic problems, but it would make a big difference.

We all honor the men and women who serve in our armed forces.  They are making a sacrifice, and perhaps the ultimate sacrifice, to help keep us safe.  I don't always agree when our politicians have deployed our troops, but I have the utmost respect and appreciation for the serice to our country that the members of military give to all of us.

We also need to honor volunteers who pitch in to help local charities that impact those worse off than us.  Even better, we should all dedicate some of our time to volunteer ourselves.  Almost all of us dedicate a pretty significant chunk of our time to recreation.  I won't get into a discussion of the realtive merits of various types of recreation, but why not dedicate 10% of your recreation time to a cause you support?  You may find it to be just as relaxing and much more rewarding.

Service Nation is an effort to turn Martin Luther King Day into a national day of service.  Not all of us can volunteer on that day, but why not spend some time that day to investigate and commit to a volunteer opportunity that fits your schedule and interests?  I've got commitments to several charities and causes.  Although it is sometimes difficult to juggle the time, it is always rewarding to do the work and see the impact it has on others.  Check out the voluteer opportunities on the Service Nation site or at my personal favorite, good2gether.  You'll find that volunteering is fun!

Also, see the head of Service Nation on last night's Colbert Report:

Hosting by Yahoo!

December 24, 2008

Reboot or Retool?

Today's OpEd in the New York Times by Tom Friedman describes rebooting America.  He's frustrated with the lack of investment in infrastructure in the US, as well as our lack of focus on key trends, such as energy efficiency.  It's a great read.

But, reboot isn't right.  We don't just need to restart, we need to adjust the mindset.  I've been frustrated by the anti-intellectualism in the US.  We elected a President that 'we wanted to have a beer with.'  Forget that.  I want the smartest person we can find, with the judgment to make the really hard decisions.

I think we need to retool.  We have to be ready to do things differently, and go back to valuing education, achievement, diversity, and equality of opportunity.  America's greatest strength in the modern world is our diverse population.  We should be able to understand more of what is going on elsewhere because we have people from almost everywhere right here in the US.  And, we should welcome more of them.  We need to improve the education system in our country and give more awards to scholars and fewer awards to actors and athletes.  We need to remind the world and ourselves that we stand for liberty for all and open opportunity.

I'd love to see musicians, actors, and athletes start to revere people of academic achievement.  We need to de-emphasize financial engineering and go back to real engineering.  This starts at the top.  I hope we have a President that will set that tone, and I hope that more leaders in our country will do the same.  And, each of us can do our part, particularly as we set the values of our children and influence those of our friends and family.

Happy holidays!  Let's get onto the right path in 2009.

Hosting by Yahoo!

November 17, 2008

Who should we bail out next?

When I first heard that the FDIC was going to insure retailer gift card balances, I was pretty upset.  I know that gift cards represent a major retail purchase these days, particularly at holiday time.  But, if a retailer squanders their cash, I didn't think that the government should bail them out.

After I read the position, it makes some more sense to me.  If the retailer keeps the gift card cash in an insured deposit institution, the insurance coverages passes through to the owner of the gift card, rather than to just the retailer.

Will a struggling retailer have the discipline to keep their gift card receipts in a separate insured account?  Probably not as the pressure on them builds.  If they don't, there isn't coverage (as I read the rule).

But, the press doesn't cover this nuance.  In fact, I think that there is a growing pressure to keep bailing out industries and consumers.  It's got to stop.  If we use our precious tax dollars for a bailout, it must be on terms that represent us all as investors of the last resort.  We should get our money back first, with a preferred return.  And, we should be able to dictate that companies can't pay dividends or current and past sky high compensation.  In other words, the kinds of terms that any private equity fund would impose on a distressed investment.

With this in mind, I am very concerned about two things:

1) An auto industry bailout.  The unions are saying that they don't want to give up anything as part of a bailout.  Luckily, that position doesn't seem to have support among Obama's advisors.  In fact, the only way we should put up money to help the auto industry is if the business is restructured, with new management, a different equation with the unions, and a commitment to R&D on more energy efficient cars.  Maybe we should focus on loan guarantees once these are in place, rather than an equity infusion.  Unfortunately, the auto industry is in such trouble that I worry that a bailout will be too expensive.  Clearly, all stakeholders have to feel pain in order for the taxpayers to cut a check.

2) A bailout of consumer mortgages.  I don't see how this can work.  Every consumer is a different situation.  Some have been thrifty but are still unfortunate.  Others have leveraged themselves to the hilt and now are in too deep.  Most are somewhere in between.  Who is going to sort out who gets saved and who doesn't?  And, how can you restructure these mortgages once they've been securitized?  Changes to a mortgage can impact hundreds and thousands of investors who may have profited during this mess but didn't necessarily take unusual risks (knowingly).  Instead, I'd like to see this sort of bailout aimed at giving the mortgage companies an incentive to restructure mortgages to more reasonable terms and giving homeowners some time to move out of homes that they can't really afford.

And, it seems that the Bush administration is content to run out the clock and let the Obama team try to figure out the next steps.  Maybe this is a good thing.  With all the moves the government has made, I think we should take a breath and let the markets settle out and seek its level.  We need to stop the expectation that each day they'll be someone new receiving a bailout.

Hosting by Yahoo!

November 10, 2008

Another Globe pickup

Scott Kirsner was kind enough to include an excerpt from my post from last week on the bank bailout in his column today.

I think that a lot of Americans are hopeful about Obama as our next President because we want him to re-look at how we have been doing things for the past eight years.  Today in the Globe, there is an article about the Pentagon saying that their budget is unsustainable.  Hopefully, Obama will include some Republicans in his administration to take advantage of broader points of view and to lower the divisiveness in Washington.  And, in yesterday's paper, it was speculated that due to Obama's broad grass-roots fundraising, he is much less beholden to special interest groups than recent Presidents.

Similarly, I hope that Obama's economic team looks at the bailout, which I reluctantly support.  If we structure the deals properly, it can make money for the tax payer.  As investors of last resort, we should make money before anyone else.  And, that means that we should get paid before dividends are paid out and deferred compensation is paid to executives.

For a historical perspective on some of the challenges that the Republicans face over the next few years, read this excellent OpEd piece from today's Globe, too.

Hosting by Yahoo!

November 05, 2008

Not with my money

With the excitement about Obama's victory, don't take your eyes off the bailout.  The government is still doling out lots of money to financial institutions.  The goal is to strengthen the balance sheets of banks so they can ease up on credit.  And, to strengthen weakened insurance companies so they can meet the capital requirements that back up their policies.  It is a crisis, and I support these moves with great trepidation.

After writing last week about our investment going to fund deferred executive compensation, BailoutSleuth reported Monday about our money being used to pay very high dividends.  As bank stock prices have dropped, their dividends have become more significant.  Many investors buy bank stocks for the dividends, and that's great.  If banks are profitable and want to return profits to their shareholders in the form of dividends, no problem.  I even own a bunch of bank stocks and receive dividends from them.

But, if the banks are taking on investment from the US government, they should suspend dividends until that investment is paid back.  VCs and private equity firms know how to structure their investments to control dividend payments.  They closely manage companies to monitor compensation.  This protects their investment and focuses the money toward building the business.  Since we were the investors of last resort, we should get a similar deal.

If the government needs better lawyers to structure these deals, I recommend my friends at Foley Hoag...

Hosting by Yahoo!

New Day in America

There is true excitement in much of America today.  Electing Barack Obama as the 44th President wasn't about race.  It was about shutting the door on the Bush presidency and looking to the future as we tackle some of the biggest challenges we have faced in my lifetime.  I had planned to quote this on January 20th when Obama took office, but the new day really feels like today.  When Gerald Ford took office after Nixon resigned, he said:

My fellow Americans, our long national nightmare is over.

With the country and the world looking to Obama, I can't wait to move forward.

I hope that Obama governs from the middle, acting as the President of all of the country, not just those who voted for him.  After Clinton was elected in 1992, the Democrats also controlled both houses of Congress.  However, disaffected Republicans, led by Newt Gingrich, came charging back in 1994 with the rallying cry of the Contract with America.  I think that the Republicans need a new rallying cry moving forward. 

I see the Republicans really splitting with the far right having a significant focus on social issues while the conservative middle worrying more about the economy and excess government spending while being more libertarian on social issues.  McCain's natural base was the middle, while Palin appealed to the far right.  As any marketeer knows, it's pretty hard to sell two messages at once.  The interesting question is which message the Republicans will embrace.  It may not be possible to rebuild the base that President Bush held in 2004.  That was a fragile majority, and shifting demographics have probably eliminated it.

I'd welcome a Republican party that shifts toward the middle.  I thought that McCain could have won had he stuck to the middle (which is how he won the Republican nomination).  He watered down his own brand, first with the selection of Palin.  She may be capable, and, ultimately, formidable.  But, her lack of experience undermined McCain's 'experience' message.  Obama may also lack experience, but he has demonstrated an intellectual curiousity and capacity that gave many Americans confidence in him as our next CEO.  Also, he has a calm tone and an emphasis on honesty, which is what Americans hungered for after some of the nightmares of the past eight years.

Hosting by Yahoo!

November 04, 2008

Just Do It!

Please make sure you get out and vote today. I'm heading out to vote now. It's worth wating in line if that's what it takes.

Even if your state is not on the critical path for the Presidential election (what's the chance that McCain will carry Massachusetts?), there are Senate, House, and state offices, as well as ballot questions.  I think that voters are waking up to the fact that all of these matter. 

No surprise to anyone who reads this that I am voting for Obama today.  I think that he has shown through a long campaign that he has the right temperment to be President -- he's intelligent, calm, and reassuring.  But, he can also unite our divided country and lead us out of our current troubled times.  I think that John McCain is a great American leader, but we need someone more in tune with tomorrow than yesterday.  His choice of Palin as VP sealed his fate, I believe.

In Massachusetts, we have three ballot questions.  Question 1 is the most critical.  It would irresponsibly eliminate the state income tax without putting forth any plan on how critical services would be funded in its place.  I am all in favor of making government smaller and more efficient.  And, no one enjoys paying taxes.  However, we don't need chaos.  Assuming that the government will figure out how to move ahead with a huge, sudden revenue cut is crazy.  There are many people who are upset about the loss of services from our recent $1B state budget cut (which was justified).  How many of those people would consider voting yes on 1?  So, unless you hear a plan on how the government would move forward without an income tax, you have to vote No on Question 1 in MA.

Enjoy our democracy today!

Hosting by Yahoo!

October 22, 2008

Can't we remove the labels?

I'm so tired of the brash labeling that has been going on in the Presidential race.  I think that this type of thing is one reason why we all get so tired of the long election cycle.  Real debates of the issues would be worth having, even over a long cycle.  But, the labeling is very divisive.  One thing I really want to see happen is the country come together to solve our problems.  Divisive labeling defeats that purpose.

Does anyone really believe that Barack Obama is a terrorist because he knows Bill Ayers?  There is no doubt that their paths crossed, but only 30 years after Ayers bombed anything.  I'm not defending Ayers's tactics in the 60s, but he had obviously cleaned up his act enough for the Annenbergs.  This issue is only being harped upon to get the words Obama and terrorist in the same sentence.

Although she apologized for it, why would Sarah Palin suggest that some parts of the country are more 'pro-America' than others?  That sentiment wasn't an isolated mistake.  One of McCain's aides also talked about Virginia vs. 'real Virginia.'  Do you really think that there are any parts of this country that aren't 'real' Americans or 'pro-America?  Can anyone say that Obama isn't pro-America?

Most recently there is the socialist label.  You may not agree with Obama's tax plan.  You may not like that he's going to raise taxes on higher wage earners in order to lower taxes and refund payroll taxes for lower wage earners.  But, that's a shift in the progressive tax scheme, not socialism.  I don't think anyone in power in Washington is a socialist, even those reluctantly having the US government buy stakes in our troubled financial institutions.

I realize that these are all labels thrown out by the McCain campaign.  I'd be happy to respond to labels tossed out by Obama if people can point them out in the comments.

For a humorous view of the label game, check out last night's Daily Show (and here)


Hosting by Yahoo!


If you share my concern about the government's involvement with our private sector as part of the economic bailout, you should read  This is a site that is paid for by Mark Cuban.  Mark is a true maverick since he owns the Dallas Mavericks basketball team.  He also owns the HDNet TV network and was the founder of, sold to Yahoo for more than $2B during the bubble.

As you can see in the October 17th post on BailoutSleuth, the financial details of what the government is paying Mellon for their role in managing the bailout has been redacted.  This isn't national security, folks.  This is a government contract.  We know how much military contractors charge us for weapons, but we can't find out what we're paying the contractors for the bailout?  In today's post on BailoutSleuth, there are portions of the contracts with PriceWaterhouseCoopers and Ernst & Young that have been redacted.

No matter who wins on November 4th, I hope we get back to a more open and transparent government.  Kudos to Mark Cuban for keeping the focus on how we're spending one of the largest piles of our tax dollars.

Update: I updated this post after publishing it initially to clarify what is referenced from

Hosting by Yahoo!

October 13, 2008

In the Globe again

In today's Globe, Scott Kirsner was nice enough to quote The Fein Line again, this time on my response to McCain's plan to bail out homeowners and mortgage lenders by repurchasing mortgages that are under water.

The quote in the paper focuses on my criticism of McCain's plan because it really gets the lender off the hook as well as the homeowner.  I also proposed some solutions that would require the lender to write down the mortgage and provide them some incentive to restructure the terms of the loan to make it more affordable for the homeowner.  I think that any resolution to this problem is going to be incredibly complicated due to the varying terms of home mortgages and each person's situation.  Should you treat the homeowner who saved up to buy the nicer house that they couldn't really afford and sacrificed right and left to make the payments the same way you treat the person who mortgaged their house to the hilt in order to buy a fancier car and take a nice vacation?  Both homeowners are in over their head, but I've got more sympathy for the former.  Who is going to decide which ones get help?

Fundamentally, I have a problem helping out companies who knew that they were taking inordinate risks just because the market let them.  And, I have a problem with homeowners who bought a house (or refinanced to the hilt) because they could and not because they could really afford it.  The majority of us live within our means (I hope!) and shouldn't have to bail out those who didn't.  We need to rescue our economy and the credit market, not the risk takers and profligate spenders.  These aren't just Wall Street fat cats.  They could also be your neighbor who spent way beyond their means, fueled by easy mortgage lending.

Over the weekend I learned of a friend of mine who is a small business owner (not high tech) who got in way over his head.  Fundamentally, he had two problems:  1) He expanded too quickly without getting to profitability first and 2) he had raised money from friends and family and could not face telling them that he was struggling.  So, he kept up the appearance of success as long as he could, which only led to him digging a deeper hole.  There is nothing wrong with dreaming big, but that shouldn't mean building a bigger house of cards.  Instead, focus on getting the foundation solid and building from there.

Hosting by Yahoo!

October 11, 2008

Focus on what really matters

My political biases may be clear to those who read this blog, but I have to admire John McCain for resisting the temptation to roll in the muck with many of his supporters.  "I have to tell you he is a decent person and a person that you do not have to be scared of as president of the United States," McCain said of Obama, much to the consternation of some of his supporters.

I can understand people who want to vote for McCain because they think he will be more fiscally responsible than Barack Obama, or who feel he will do a better job in foreign policy.  I don't necessarily agree, but those are principled positions.  However, when Republican supporters are whipped into a frenzy because they think Obama is an 'Arab', or commits 'treason' or is a 'terrorist', they're just stupid.  I don't like McCain's positions, but I acknowledge that he is patriotic and is advocating what he thinks is the right path.  I'm glad that he's willing to acknowledge the same about Obama.

I think that most Americans are exhausted from the partisan rancor.  We need legitimate discussions of how to deal with all the big issues we face, including the loss of the world's confidence in America.  I think that the best solutions are those that include elements from both sides of the aisle.  With the hatred of the opponent so high, it makes compromise difficult.

When McCain's supporters exhort him to 'take off the gloves', why does that have to be character assassination?  Why can't he rally support around his own proposals and discredit Obama's (without lying, of course)?  If his proposals can't win on their merits, then McCain doesn't deserve to win, either.  And, I feel exactly the same way about Obama.

Hosting by Yahoo!

October 08, 2008

Slippery Slope

At last night's Presidential Debate, John McCain said that he would order the Treasury Department to purchase up to $300B of consumer mortgages at the original value of the mortgage and renegotiate them down to the new diminished value of the home.  The idea is to get people into a loan they can afford so they don't lose their house.  It sounds like a nice idea to help out homeowners, but I think that it is an incredibly slippery and expensive slope.

First of all, the taxpayer will be taking the loss on all of these mortgages.  That seems like one of the biggest government handouts ever.  Secondly, this loan will bail out banks who overextended credit, falsified appraisals to inflate home values, or engaged in other practices to over-mortgage properties.  These banks will be made whole.

However, the most complicated part is bailout out the homeowners who over-mortgaged their property and spent the money on something else.  There are plenty of people who mortgage their homes to the hilt and spent the money on new cars, vacations, etc.  This was encouraged by banks.  Now, the taxpayer is going to pay for this profligate spending.  And, McCain calls Obama a liberal!

The worst is that this rewards all the people who took advantage of the easy credit at the expense of those people who lived conservatively and didn't end up in trouble.

I'd prefer a program where the level of debt that the homeowner owes isn't reduced.  Perhaps some level of debt has to be moved to a soft second mortgage that is only paid out when the property is sold (or is possibly forgiven if the homeowner stays in their home and pays their mortgage for 10 years).  Mortgages will be restructured so that homeowners are given 'prime' terms even if they are subprime borrowers (30 year fixed rate mortgages only).  The banks will have to take a write-down for the diminished value of the loan, but that will be cheaper than doing a foreclosure.  And, perhaps, the government can provide some sort of tax credit proportional to the value of the writedown that a bank does to encourage this and soften the blow.

Homeowners who can't afford their mortgage even with the terms above should be required to pay whatever they can towards a restructured 'prime' mortage in order to get a six-month moratorium on foreclosure.  This gives them time to move to something they can afford.  It keeps some cash flowing to the lender during the foreclosure process, softening the loss from the foreclosure.  A tax credit for restructuring the loan as described above is also a possibility.

I prefer this type of approach because the homeowner doesn't get to wriggle out of their responsibilities.  I think that the very large majority of homeowners subjec to foreclosure knew that they were borrowing more money than they could afford.  Shame on the banks for making this loan available, but shame on the homeowner for getting in over their head.  This approach also limits some of the losses of the banks, but the banks will certainly take some losses (somewhat offset by some tax credits).

Minimizing foreclosures will help the banks financial situations and will help stop the drop in home prices from foreclosed homes flooding the market.  There are probably still many challenges with this approach as the restructured loans are securitized and may be difficult to change.  Part of the government rule would be allow these changes to happen without making the banks liable for changing the terms of the loans.

We have to do everything we can to make sure the money we spend during this time bails out the economy, not the individuals or companies who took advantage of the easy credit environment.  Individuals and companies can survive, but they'll have to give up a lot financially in order to do so.  Unfortunately, I don't know how we can reclaim the profits and bonuses that were legally made during the runup before this crisis.

Hosting by Yahoo!

October 01, 2008

No Matter What, You Gotta Vote

Time is running out to register to vote.  In Massachusetts, you have to be registered by October 15.  In New Hampshire, you can register on Election Day (great!).  With all of the things going on in the world today, this election is certain to be extremely important.  No matter where you come out on the issues, please be sure to register and to vote.  Google has a nice site with voter information here.

So many people decide not to vote for many reasons (apathy, laziness, busy schedule, etc.).  With more and more states offering absentee and early voting options, your schedule on November 4 isn't a viable excuse.  Please be sure to register and vote, and get your friends to do so, too!

Hosting by Yahoo!

September 28, 2008

Be mad, but don't be crazy

Back in May, I wrote about the misguided effort behind Massachusetts ballot question 1 on repealing the state income tax.  I just don't see how you can have such a big dislocation of revenue without a plan for figuring out how we would deliver the services through some other means, public or private.  If you look at our financial markets right now, you can see how chaos can spiral out of control when we have unsound financial plans.

Today's Boston Globe had an editorial piece on the same subject, recommending a No vote on Question 1.  Read the editorial for a list of all the various groups who oppose question 1 -- the Mass Municipal Association, Chambers of Commerce, teachers, school administrators, religious charities, even the Mass Taxpayers Foundation.

Some tidbits from the editorial:

After steady work by fiscal conservatives in the Legislature, Massachusetts has shed its "Taxachusetts" epithet and now ranks 32nd for overall tax burden - that is, all taxes paid as a percentage of personal income. That is below the national average and well below competitor states such as New Jersey, California and Michigan.

The Massachusetts Taxpayers Foundation estimates that some $13 billion in state spending is non-discretionary: required by court order, the constitution, or federal law. The $12 billion cut would have to come out of what is left.

The state could stop spending every dime it now spends on local aid and every dime on human service programs - food banks, domestic violence and homeless shelters, care for autistic children, substance abuse and more - and still not have enough to make up for what is lost to Question 1. The state could fire all 67,000 state employees - every prison guard and college teacher - and still have to find another $7 billion.

And, most amazingly proving the craziness on the part of the backer of Question 1, Carla Howell:

Carla Howell, chairwoman of the committee sponsoring Question 1, says 41 cents of every tax dollar is wasted. How does she know that? It's what people estimated in a survey she took.

That's the kind of sound financial analysis that caused our current Wall Street mess.  I am all in favor of cutting taxes, but only with a plan that figures out what we will do in their place.  With the lower tax burden in Massachusetts, what is the analysis that shows that we could and should cut our way to the bottom?

As the editorial says:

We hope voters will remember the slogan that helped defeat an earlier tax repeal effort - "I'm mad, but I'm not crazy" - and reject this reckless measure.

If you read the comments to the editorial, it's clear that there is a lot of anger among taxpayers.  There is no doubt that there is money to be saved in the state government.  But, it's much more effective to do surgery with a scalpel than with a meat cleaver.

Hosting by Yahoo!

September 16, 2008

The person makes the job

It's the person who makes the job, not the other way around...

“Jesus was a community organizer. Pontius Pilate was a governor.”

This quote is getting some people upset.  The point isn't to compare Obama to Jesus or Sarah Palin to Pontius Pilate, but to remind ourselves that you have to look at the person, not just the job they had.

Hosting by Yahoo!

September 14, 2008

Elite vs. Elitist

A comment I posted on Fred Wilson's blog:

People need to learn the difference between elitist and elite. Elite means "the choice or best of anything". We should demand that only the elite lead us. We celebrate the elite in almost every walk of life -- sports, business, entertainment. But, somehow, we seem to be skeptical of the elite in leading us because we think that they aren't like us.

Elitist means someone who believes "certain persons or members of certain classes or groups deserve favored treatment by virtue of their perceived superiority". Elitists feel a sense of entitlement, perhaps because of their intelligence. I agree that someone who believes they are so entitled may not make a good leader, but you can't spot them because they have a large vocabulary or prefer to eat nicer foods.

Hosting by Yahoo!

September 12, 2008

Time for the Lifeboat...

One of the best exercises that a company can do is a lifeboat drill.  When faced with difficult choices of resource allocation, companies need to go back to first principles to decide what to do.  Too often, companies make a choice between the last two things they are doing rather than question some fundamental assumptions.

The essence of the lifeboat drill is like zero-based budgeting.  You begin with no assumptions of what's in and what's out.  It forces you to really assess the priorities of every activity and every person associated with it.  It can be a much bigger job than thinking incrementally, but it is definitely a worthwhile excercise to do, particularly for a whole team.  You may find that other members of your team have different fundamental assumptions than you do.  Getting these base-level priorities agreed upon is critical to getting everyone in the company moving in the same direction.

Another application of the lifeboat drill is when you are forced into a situation where you have to cut expenses, particularly in doing a layoff.  If you really force prioritize every project and every person, it will be easier to make the decision about who you have to cut during these difficult times.  Also, the prioritization drill will make it easier to communicate to your remaining employees why you made the choices you did and what tasks you will and won't do going forward.

Unfortunately, I think that the country needs to do a lifeboat drill, too (sorry, can't get politics out of my mind these days).  I am apalled by our ballooning deficits and by the overextension of our military.  We are waging an ill-conceirved foreign policy on the backs of of people whom we don't sufficiently care for when they return.  The priorities are all wrong.  I'd love to see a new administration really do a lifeboat drill on what our priorities are, ensuring we have our top priorities properly funded and having the discipline to cut off the priorities when we reach the limits of our ability to spend (and not borrow).  If something is really important and beyond our current ability to afford it, shouldn't we be willing to raise revenues to pay for it?

A small thing triggered this in my mind.  If you have visited an office building in a big city, you have undoubtedly gone through security checks with ID's verified, etc.  This level of security has greatly increased since 9/11/01.  Is this level of security really worth it?  Or, did it just make us feel better after we all were so scared seven years ago?  Certainly it wouldn't have stopped the types of attacks that have happened.  And, it is probably easily thwarted by someone determined to do so.  If I were a landlord in one of these buildings, I'd do the lifeboat drill to figure out if this level of spending is really necessary.

Hosting by Yahoo!

September 04, 2008

Spinning out of control

I am drawn to politics at this time of year, but it also really bugs me.  I'm not going to pretend to be completely objective, but the selection of Sarah Palin is pretty interesting as McCain's VP.  I actually have no problems with Ms. Palin.  From what I can see, she hasn't tried to be anything other than herself.  Clearly, her background is atypical of the usual running mates.  It was an interesting decision for McCain to make.  We'll see how she weathers the non-stop scrutiny of the election process.

But, the part that bugs me about politics is the senseless spin.  If you look at Sarah Palin's background, it's clear that she doesn't have any real foreign policy experience.  According to this article in today's Boston Globe, she didn't get a passport until 2006 when she needed one to visit some Iraqi troops.  For a small-town Alaskan mayor, that's probably not unusual.  And, it seems that Governor Palin has been focused on domestic issues in Alaska, which her constituents seem to appreciate.  Hey, I don't want Massachusetts Governor Patrick worrying about foreign affairs, either.

Why then do the spinmeisters try to portray her international experience as "being right next to Russia" and "commanding the Alaskan National Guard"?  That obviously doesn't qualify as experience.  Now, die-hard Republicans don't need the spin.  they are going to support just about anyone the party puts up.  It seems to me that the battle is over those in the middle.

Do you convince the voters in the middle by spinning to them about the candidate's qualifications?  The spin is so strong that it borders on lying.  Or, do you convince them by saying "she's a high-energy maverick who has done a great job running as governor and understands the needs of every day Americans.  She'll be a great asset on domestic issues and will quickly come up to speed on international issues"?  That to me is the Republican positive view of Palin.  So, why risk convincing someone who might be open minded with something that sounds ridiculous?  Maybe it works, which is a sad commentary on our electorate.

For a funnier view of spinmeisters getting caught in their own spin, check out last night's Daily Show (why don't real media types hold these folks accountable?).


Hosting by Yahoo!

August 29, 2008

Ethics and Efficacy

Another parallel I've seen between politics and business is in the two big things I look for in leaders:  ethics and efficacy.

Not to get off on too much of a political rant, but we've been awfully short on both of these for the past eight years in Washington.  It's clear to me that the country didn't get the full story on Iraq before we were led into war, and war should always be our last resort.  War should never be undertaken capriciously.  Besides the ethical violation, this war has also wasted thousands of lives and hundreds of billions of dollars.

Beyond that, the Bush adminstration hasn't demonstrated efficacy ("capacity or power to produce a desired effect").  Think of both the abominable handling of Hurrican Katrina, but also the inefficient and slow rebuilding effort.

Luckily, I am much more comfortable with the ethics of both of the Presidential contenders.  It's probably not a surprise that I favor Obama over McCain, but I do believe that McCain wants to do what he thinks is right for the country.

It's impossible to judge efficacy.  Both come from legislative backgrounds where you have little ability to really get things done.  I don't count getting legislation passed as being comparable to building teams and running large organizations.  Both campaigns seem to be run very well and both candidates overcame some long odds in order to get their nominations.

The key to efficacy is building and managing the right team.  Experience can help with this, but it comes down very much to personal characteristics.  I think that a leader seeking efficacy must surround themselves with the strongest possible team, listen to all points of view, remain open-minded when faced with problems, rely on their own ability to make a final decision, and be willing to admit mistakes and make changes.  I remember reading in a management book a long time ago:  "give credit, take responsibility"

Contrast that with "Brownie, you're doing a heck of a job"

Hosting by Yahoo!

Getting Real

Hard to believe that another week has zoomed by without having time to post something.  Luckily, things slow down before a long weekend, and I have time to finally post a few thoughts that have been rattling around my brain this week.

A lot of my thinking about business lately has been colored by what is going on in the political arena.  No surprise that politics are dominating the news as we are in the middle of the national conventions.  But, there are some lessons to be learned that also apply to business.

I remain mystified by the Hillary Clinton supporters who feel so wronged that they would rather vote for John McCain than Barack Obama.  I've seen varying reports on the real number of Hillary's backers in this camp, but the whole concept doesn't make sense to me.  If you liked Hillary's positions, you can't be too disappointed with Barack Obama's positions.  They are almost the same, and much different than McCain's. 

I thought that Hillary should hang in there until she was really elminated from contention.  Anyone getting that close would do the same.  And, perhaps the media didn't treat Hillary fairly because she's a woman (as well as being Bill's wife).  No one said that running for office was for the faint of heart or for someone with thin skin.  In the end, Hillary capitulated.  And, I thought her speach at the Convention was quite good.  She has little choice but to be a good soldier going forward.

Her supporters who continue to be defiant are in an alternate reality.  This was a race, and she lost.  When it's over, you have to move on.  I've seen this in companies, too.  The management gets stuck in the past and keeps fighting last year's fight.  I am a strong believer that you have to deal with reality in business.  Putting your head in the sand doesn't serve anyone.  I think it was Harold Geneen who called this 'unshakable facts'.  He insisted that his managers make their decisions based on facts, not opinions and emotions.

There are a lot of mature companies today that need to move on to their next fight.  Instead, they continue to fight the last one.  This causes them to squander resources and miss out on new growth opportunities.  The lack of objective, outside, and yet constructive input is one reason why companies can't see this problem themselves.  As an entrepreneur or a company leader, you need to make sure that you are looking at the company's situation as objectively as possible.

On a lighter note, Jon Stewart showed a healing program for Hillary supporters who are stuck in the past.


Hosting by Yahoo!

July 15, 2008

The Power of Deregulation

Regular readers know that I love The Colbert Report.  Here is his 'The Word' segment from last night, describing the power of deregulation.


Hosting by Yahoo!

July 14, 2008

Free speech, but...

I'm a big believer in free speech.  I don't like political correctness and think that almost all types of speech, including hate speech, should be protected.  That doesn't mean that I support hate speech.  But, once you start drawing the line on any form of censorship, it becomes a real slippery slope.  One person's freedom cry is another person's treason.  If the government can decide which is which, then the government can't be challenged, even challenged to improve.

With all that said, this week's New Yorker cover disturbs me.  You can see a slide show of many poltical satire New Yorker covers on their web site.  In just about all of the covers, the satire is that the leaders are depicted as incompetent idiots.  The reader can decide if they agree with this.

However, the Obama cover above takes the 'terrorist fist bump' (man, is that ridiculous) and extends it to a terrorist image.  Does that mean that the reader gets to decide whether or not they think Obama is a terrorist?  And, this image includes a picture of Bin Laden over a fireplace with a burning American flag. 

No matter what you think of Obama or McCain, can you really question either one of them on patriotism?  You may not agree with where they want to take the country, but that doesn't mean that they want the country to fall.

So, as a free speech zealot, why does this cover bother me so much?  I think that it's because The New Yorker has a certain amount of credibility.  Also, the cover goes beyond satire in my opinion.  Now, I don't think that anyone should stop The New Yorker from being able to publish this.  But, Obama has decried this, and McCain agreed.  And, I hope that regular New Yorker readers express their outrage so that The New Yorker apologizes.  The only penalty that should be imposed on improper speech should be from the marketplace -- people who disagree shouldn't buy it.

Hosting by Yahoo!

July 11, 2008


I listened to an interview with Bill Bishop, author of The Big Sort: Why the Clustering of Like-Minded America Is Tearing Us ApartThis reinforced my belief that one of America's greatest strength is that we are a melting pot.  But, if we all gravitate to communities and social circles where everyone is just like us, we will all miss out on the benefits of the diversity.

When I think about entrepreneurship, I always associate it with new ideas, high energy, and commitment.  This is exactly what you get with new immigrants who come to the US to make their lives better.  My grandparents were immigrants, and my paternal grandfather was an entrepreneur.  He built up a pretty big wholesale and retail grocery business after coming the country with very little.  While there is nothing stopping native-born Americans from being just as entrepreneurial, our privileged upbringing probably removes some of the inner hunger that an immigrant who has to overcome large obstacles probably has.

But, even more important than making sure we continue to have a steady stream of immigrants coming into the US with new ideas and new energy, we all need to continue to expose ourselves to new people and new ideas to avoid complacency.  We tend to settle into our comfort zones where life is predictable and less challenging.  That's a recipe for stagnation.  Instead, we need to force ourselves to meet new people, from different backgrounds, and embrace new ideas.

Unfortunately, it seems that too many people are pulling back into a comfortable cocoon of familiarity.  Even our news sources are reinforcing this, with opinion and news being all mixed together so that our minds are made up for us.  You have to work hard to get multiple points of view on an issue.

The more we learn about other people, other cultures, and other ideas, the better we will be able to deal with the world's problems.  The more innovative we will be.  The better our solutions will be.  So, fight the tendency to stay with your comfort zone and push out of it once in a while.  Travel to really different places and countries.  Push into social circles with people of different backgrounds -- ethnic and financial.  And, make sure your kids do the same.  You'll understand the world in different ways.

This brings me to Barack Obama.  Despite my real disappointment that he zig zagged on the FISA/telco immunity issue, I still think that he is the rare candidate that can pull the different parts of the country together.  He's not perfect, and he's not as experienced as some people would like.  But, I think that we are all going to have to sacrifice somewhat to solve the big problems facing the US.  It will be easier to sacrifice with someone who really unites us at the helm.  I think that one reason Bush won in 2000 was his 'uniter, not a divider' line.  If only it were true. 

(PS - read the Salon article from the last link.  Is that really the same person who has been President for the past seven years?)

Hosting by Yahoo!

June 29, 2008

Look Before You Give

This article in today's Boston Globe was pretty interesting.  The examples are all from the Republican side, but I wouldn't be surprised if the same thing happens on the Democratic side, too.

The article describes how candidates hired firms to run their fund-raising.  The candidates were not very successful, but the fund-raising firms took 90-97% of all of the money raised for fund-raising expenses.  According to the article, 30% is a more typical number.  Even more surprising, some of the firms kept on raising money nationally for candidates that had dropped out of the race.  They were playing on people's emotions -- "Defeat Liberal Barney Frank" -- even when his opponent had only garnered 147 votes statewide and couldn't qualify to get onto the ballot.

This is a year when more people than ever have paid attention to politics.  There is a ton of fund-raising done over the Internet and via direct mail.  Our political financial system is very complicated, and people give money to causes as well as candidates.  Before you give to someone or some cause, make sure you know where the money will go.  I don't know how you could have figured out that giving money to one of these candidates would just fund the fund-raising consultants, but at least make sure your candidate is still in the race!

Hosting by Yahoo!

June 21, 2008

Bush's Strategy Revealed

Jon Stewart figured out what Bush's strategy has been for the past 7 1/2 years....


Hosting by Yahoo!

June 06, 2008


Now that Senator Obama is the presumptive Democratic nominee for President, there is a lot of interest in him picking Hillary Clinton as his VP.  Since the battle between them was so close, people think that teaming them up will give the Democrats the best chance to beat John McCain in November.

I don't get that.  One reason why the race between Obama and Hillary was so close was that their positions are not that different.  Certainly, they have different levels and types of experience and have different styles.  I like Obama but would have been willing to vote for Hillary had she been the nominee.  Strangely, there are many Hillary supporters who say that they'd rather vote for John McCain than Obama.  Huh?

Maybe they are bitter that Hillary lost.  The press was tough on Hillary, particularly the conservative pundits.  It may not have been fair and may have been misogynistic.  But, I don't think that Obama showed her anything other than respect.  And, if you support Hillary's positions, you can't be that disappointed with Obama.  There are some differences, but mostly those of degree.

Meanwhile, if Obama wants to build a strong ticket, he needs balance.  Someone with more Washington experience.  Someone with some complementary positions who is willing to support Obama.  Maybe from the South or West or a state he's got to carry.  And, dare I say, an old white guy may not be a bad selection.  Race does matter, although Obama's nomination shows that progress is being made.  I don't know enough to suggest anyone, but Jim Webb from Virgina is mentioned a lot (he says he's not interested).

It would be easy to rush to a decision to put Hillary on the ticket, appease her followers, and strive for unity.  But, time and perspective will lead to a better decision.  This is often the case, and big decisions should only be made when they need to be, after sufficient time and consideration.  Anyway, Hillary is going to support the Democratic ticket no matter what.  She doesn't have to be on the ticket to endorse Obama.

Hosting by Yahoo!

May 17, 2008

You Are What You Golf

As NPR reports, interviewed President Bush this past week.  In the NPR story, they talk about the message sent by Presidents and their golf game.  Bush said to Politico:

For the first time, Bush revealed a personal way in which he has tried to acknowledge the sacrifice of soldiers and their families.

“I don't want some mom whose son may have recently died to see the commander in chief playing golf,” he said. “I feel I owe it to the families to be in solidarity as best as I can with them. And I think playing golf during a war just sends the wrong signal.”

Bush said he made that decision after the August 2003 bombing of the United Nations headquarters in Baghdad, which killed Sergio Vieira de Mello, the top U.N. official in Iraq and the organization’s high commissioner for human rights.

“I remember when de Mello, who was at the U.N., got killed in Baghdad as a result of these murderers taking this good man's life,” he said. “I was playing golf — I think I was in central Texas — and they pulled me off the golf course and I said, ‘It's just not worth it anymore to do.’"

I guess Eisenhower, as a general, played golf during World War II.  He also played golf during the Korean War.  Everyone needs a way to relax, even a President during a 5+ year war.  Maybe this is the message Bush really wants to avoid:


Hosting by Yahoo!

May 12, 2008

Crazy and Dangerous

If you live in Massachusetts, watch out.  This group -- Committee for Small Government -- is trying to create some chaos.  According to today's Boston Globe, this group is trying to put a binding ballot initiative on the November ballot that would abolish the Massachusetts state income tax.  Now, it sounds great to not pay income taxes, but, according to the Globe, this represents about 40% of the state budget.  You can't make a cut that big without a plan.

The Globe says that this is 3x the amount of money that the state sends to cities and towns for schools.  So, your income tax savings would probably be offset with big property tax increases.  But, Proposition 2 1/2 makes it hard for towns to raise their property taxes, so schools, police, and fire departments will just be cut, probably deeply. 

The advocates of this crazy idea cite government waste as the reason to do this.  I am all in favor of cutting government waste.  I'd love to pay less in taxes.  But, I'll only do it with a well thought out plan for making departments more effiicent, thinking through alternative funding sources, etc.  I know from looking at my town's school budget that there is huge pressure from special education and energy costs that ensures that the schools have to tighten and cut a bit every year.  Although this is painful, it does make sure that the adminstrators are looking out for effiicency.  Could they do more?  Probably.  Could they cut 40% overnight and still do anything close to their current mission?  No way.  We'll be paying fees for everything to offset this crazy scheme.

Something like this surprisingly got 45% of the vote in 2002.  I expect a more organized fight this time.  I'd love to see a debate between Governor Patrick and Carla Howell on this.  We'd be so much better off if people like this put forward well thought out proposals on cutting government spending without creating chaos.

Hosting by Yahoo!

May 09, 2008

Persuasion not Domination

I haven't read his book yet, but I did listen to an extensive interview with Fareed Zakaria where he discussed "The Post American World".  My main exposure to Fareed has been on The Daily Show, where he is a frequent guest.  I always liked his viewpoint.

Fareed's new book is about how America finds its place in a new world where there are many powers, not one superpower.  With the ascendancy of China and India, the resurgance of Western Europe, and the US bogged down in Iraq and with some internal issues, the US has lost a lot of influence over the past few years.  I don't think we can get this back by flexing our muscles.  Instead, we must change our approach and be the 'Chairman of the Board', as Fareed describes.

One of the best lines from the interview (and probably a quote from the book) is that the US must lead by persuasion, not domination.  We have lost our power of persuasion and have tried to get our way by being the bully.  We'd be much better off, and much safer, with a persuasive and inclusive approach.  We need to be engaged with the world and building coalitions, not demanding that we get our way.

I think that this is one of the most important meta-trends in our country.  One of my main criteria in deciding who I am going to vote for in the Presidential election is "which candidate is best able to change the perception of the US in the world and lead by persuasion?"  Hint: Talking about being in Iraq for 100 years or obliterating Iran probably disqualifies you.

Another good line from Fareed: When other countries are looking out for their self-interest first, we call it nationalism.  When we look out for our own self-interest first, we call it patriotism.  I think that what we need to do is  to persuade people that all of our interests are actually aligned.

This theme particularly resonated with me because our new investment firm, Sempre Management, will also require us to use the power of persuasion with our active, hands-on investor approach.  We like to think that we are pretty good at persuasion.

Hosting by Yahoo!

May 02, 2008

The issues are the issue

I thought that the long, drawn out Democartic nomination process would be a good thing, but now I am not so sure.  I thought that having the whole country involved, with two closely matched interesting candidates running, would lead to more people paying attention to the election, more careful consideration of the candidates, and higher voter participation.  Certainly, there are more people voting, which has to be a good thing.  Also, the Democrats have an easier time staying in the news, which is probably helpful to them.  But, I think that the nomination race has deteriorated greatly.

I am late to the party on this, but the focus on which fringe religious person support whom and what misstatement each candidate when is a complete waste of time.  I can't believe that a whole hour of the last debate was focused on this.  Who cares?

I liked Hillary's idea of a head-to-head debate with no moderator.  I guess that Obama is not going to do this.  He must feel that he has a lead and doesn't want to give her any openings.  There have been a lot of debates, but much of the country has only been paying attention since February.  Once Super Tuesday didn't end the race, it got a lot more interesting.

Unfortunately, in the last few months, there has been very little discussion of the issues between the candidates.  They had their slightly different views of NAFTA.  They certainly disagree on the usefulness of a federal gasoline tax holiday.   But, they should be talking again about the big issues -- Iraq, the economy, energy policy, healthcare.  That may not be what the press wants to focus on, but that's what the country needs to focus on.

I'd love it if one of the candidates in the last debate told Charlie Gibson "that is a ridiculous question that I am not going to answer.  Can we have a question about the real issues, please?"

Hosting by Yahoo!

April 19, 2008

Funniest Colbert Video of the Week

This is the funniest Colbert video in a long time.  As a spoof to Stephen's 'The Word' segment, John Edwards makes an appearance doing 'The EdWords'.  And, Edwards is probably the most sought after Caucasian male vote in the country!


Hosting by Yahoo!

April 07, 2008

Trust the System?

If you have any concerns about having the superdelegates decide the Democratic nomination, this should reassure you that the superdelegates are qualified to make the right choice.  What a system!


Hosting by Yahoo!

March 03, 2008

The word on Obama

Whenever I have written about politics, I have tried to be as even handed as I can.  I've tried to focus on principle rather than on candidates.  But, I read something today that crystallized my own feelings on Barack Obama.

Marc Andreessen wrote about his meeting with Barack Obama in early 2007.  His summary of Obama is:

Smart, normal, curious, not radical, and post-Boomer.

More interesting to me was Obama's answers to the two big questions: 1) lack of executive/management experience and 2) lack of foreign policy experience.  On 1), Obama predicted that he would run a well-organized campaign.  Hard to argue with that.  And on 2), he points to his personal background and his experience on the foreign relations committee.

That second answer is OK, but doesn't really show experience.  I'd like to see Obama complement himself with some real hands-on experience, like Bill Richardson.  Perhaps he will.   But, in general, I don't think any Senator reall has foreign policy experience.  They may have knowledge, but not real experience.  That comes from being in the State Department, an ambassador, at the UN, etc.  You have to face real trade-offs to have experience.

We have a family friend who had Obama as a law professor at the University of Chicago.  She calls him the smartest person she has ever met.  That confirms Marc's impression of intelligence.  And, Marc is pretty smart, you have to be smart to impress him.

I was drawn to Obama for many of the resons Marc listed.  I also think that he is one person who can really unite the country.  After almost 16 years of very divisive politics, I think that the country wants to come together more than we want to argue.  Most politicians and pundits don't get this.  That's why so many Republicans ignored Rush Limbaugh's lambasting of John McCain.  They liked McCain's moderate positions and appreciate his frankness and independence.  More proof that we, as a country, want to be united and less polarized.

I expect that Obama will win the two major primaries tomorrow in Texas and Ohio.  If he does that, it's over.  And, we should have a pretty interesting general election season.

Hosting by Yahoo!

February 18, 2008

Less Than One More Year...



Hosting by Yahoo!

February 15, 2008

Bringing Back Some Checks and Balances


I'm glad to see the Democratic-led House of Representatives finally stand up to the Bush Administration as they continue to trample on some of our freedoms.  The House has refused to send to President Bush a bill which extends a temporary electronic surveilance act that circumvents the FISA process and adds immunity for telecom companies that helped the Administration get around existing laws.  If you look into the FISA process, you'd see that it is nowhere near as onerous as the administration claims for them to get a FISA warrant to wiretap a suspected terrorist.  And, I am all in favor of a very flexible FISA court that aids the administration's ability to monitor terrorist communication.

But, according to people like this guy, the administration is fighting terror with a machine gun rather than a laser-guided missle.  This is why the administration needs immunity for the telecom companies for past activities.  According to this story, AT&T aided the administration monitor all Internet traffic from a large peering point and probably did the same elsewhere. 

"That was my 'aha!' moment," Klein said. "They're sending the entire Internet to the secret room."

The diagram showed splitters, glass prisms that split signals from each network into two identical copies. One fed into the secret room, the other proceeded to its destination, he said.

"This splitter was sweeping up everything, vacuum-cleaner-style," he said. "The NSA is getting everything. These are major pipes that carry not just AT&T's customers but everybody's."

One of Klein's documents listed links to 16 entities, including Global Crossing, a large provider of voice and data services in the United States and abroad; UUNet, a large Internet provider in Northern Virginia now owned by Verizon; Level 3 Communications, which provides local, long-distance and data transmission in the United States and overseas; and more familiar names such as Sprint and Qwest. It also included data exchanges MAE-West and PAIX, or Palo Alto Internet Exchange, facilities where telecom carriers hand off Internet traffic to each other.

"I flipped out," he said. "They're copying the whole Internet. There's no selection going on here. Maybe they select out later, but at the point of handoff to the government, they get everything."

So, all of our privacy has been violated, not just that of suspected terrorists.  This is clearly a violation of our rights and an example of real abuse of power.

Since our next President is probably going to be a Senator (Clinton, McCain, or Obama), hopefully they'll have much more respect for the checks and balance system which makes our country great and helps preserve our freedoms.  I'd rather have freedom and some more bureaucracy than give anyone in the government the broad ability to do whatever they want.

Hosting by Yahoo!

February 07, 2008

Getting Better Polling Data

The Daily Show has some ideas on how to get better polling data.


Hosting by Yahoo!

January 22, 2008

Johnson and MLK

After writing yesterday about Martin Luther King, Jr., I was intrigued to hear this NPR show that included recordings of several telephone conversations between President Johnson and MLK in the early 60s.  The show is timely because of some of the squabbling between Hillary Clinton and Barack Obama about who actually 'got things done' when it came to civil rights.

The argument is ridiculous.  The recordings you'll hear if you listen to the show indicate some strong collaboration between Johnson and King.  Johnson needed King to continue to mobilize the public and create public awareness of the inequities of racism.  King needed Johnson to push legislation ahead through Congress.  I don't think that either could have been successful without the efforts of the other.

This issue has also brought a new focus to Johnson's efforts to improve civil rights in the US.  Johnson went down in flames due to getting us stuck in Vietnam.  But, he also needs to get credit for driving civil rights legislation.

Hosting by Yahoo!

January 09, 2008

Just Getting Started

Although Hillary is not my first choice for President, I am thrilled that she won the NH Primary yesterday.  I don't want the process to be over before it gets started.  I think that voters are just starting to pay attention, and it's good that neither party's nomination is wrapped up.  Let's at least get through Super Tuesday on February 5 before any of the top 2-3 Democrats and top 3-5 Republicans drop out.

There has been an interesting side-effect from the early starting Presidential campaign.  The candidates had lots of time to raise money, build an organization and generate interest.  Then, there is a hard sprint for four weeks from Iowa through Super Tuesday.  That's when the voters are just starting to watch the race and make decisions.  A lot of voters in NH decided yesterday who they were going to vote for.

I couldn't believe that the pundits were speculating that Hillary would have to drop out if she didn't win NH.  Yes, Obama would have had momentum, but Hillary still has plenty of money and a strong organization with broad support.  If she had lost to Obama, she'd have to make a comeback, but only two small states would have voted.  She certainly would have carried on through Super Tuesday.  By then ~30 states will have voted, and the race should be winnowed down.

I'd love to have split races through the Conventions.  I think it would be great political theater and may captivate more voters.  It may get very negative, but I think that we would really get to understand the candidates with some small scale, more detailed debates.  I hope that some intrigue would get voters more interested and get people to turn out.  If that happens, and two inspiring candidates emerge, we may get an interesting election with high turnout.

Call me an optimist, but I think we could have an election that could be interesting and end up being good for the country.

Hosting by Yahoo!

August 17, 2007

Maybe Bill is the one?

A few days ago, I wrote about my disgust at the government's misuse of power.  I also said I would vote for the first candidate who convinces me that they will lead with strength, peace, and ethics.  Maybe Bill Richardson is that guy.

Thanks to my brother, Chuck, I read this article by Richardson in the Harvard International Review.  It's not a surprise that Richardson is very qualified on foreign policy matters as he is a former UN Representative (as well as former Energy Secretary, Congressman, and current Governor of New Mexico).

The article describes the six trends he sees changing the world:

  • Fanatical jihadism
  • Growing power and sophistication of criminal networks
  • Rapid rise of Asian powers
  • Re-emergence of Russia
  • Global economic interdependence and financial imbalance
  • Globalization of urgent health, environmental, and social problems


Richardson lays out his New Realism approach to foreign folicy:

  • US must repair its alliances
  • US must restore commitment to international law and multilateral cooperation
  • US must be impeccable in its own human rights behavior
  • US must be a leader on environmental issues, including reducing greenhouse gas emmissions and developing and commercializing clean, alternative engery technologies
  • Engage directly with other nations, including Iran and North Korea
  • Focus on real security threats, including building international cooperation to do so
  • Lead the world in opening an ideological front in the ware against jihadism, including living up to our own ideals (no prisoner abuse, torture, secret prisons, and evasion of the Geneva Convention.  Close Guantanamo).  Lots more on this in the article.

I don't know if Richardson can win because politics has become such a money game.  But, I'll be studying him further.  I like what he has to say on the international side, and we have gone so wrong there in the last 7 years.

Hosting by Yahoo!

August 15, 2007

Cheney Used To Be Right

He'll never answer the obvious question about what changed between 1994 and 2003, but it's clear that the idea that Iraq would be a quagmire if Saddam fell is not a new one.

Cheney Video

Hosting by Yahoo!

August 01, 2007

No End In Sight

I heard an interview on NPR's On Point with the Director and Producer of the movie No End In Sight.  If you are feeling a bit short on rage with the Bush Administration, watch the preview of the movie below.  If you want your rage to boil over, listen to the interview on the On Point site.  I haven't seen the movie, but I plan to.

The bottom line from the On Point interview:

In the suburbs of Washington and all around the country today, there's a small army of civilian and military experts and soldiers who did their time in Iraq and are now back, brooding, ashamed and angry.

They are angry about how badly wrong their mission went, about how they might have done it better, but mostly about how virtually all their best ideas and direst warnings were steadfastly ignored by the handful of men who led them.

There was one example cited in movie of a report written on how there would likely be a bloody civil war in the aftermath of invading Iraq.  The report was summarized in a one-page memo.  President Bush never even read the one-page summary.  In fact, according to those cited in the movie, he was disengaged during the first 18 months of the invasion and aftermath.  Hey, it was only a war.  He must have had other things to worry about.


Hosting by Yahoo!

June 29, 2007

Immigration bill dead for now

I wrote recently about my hope for the compromise immigration bill to go through.  Unfortunately, it died.

No compromise could be reached that could avoid the 'amnesty' label.  And, forgiveness is bad in some people's mind.  Let's hope those people don't need our forgiveness in the future.

Hosting by Yahoo!

June 27, 2007

Governing from a compromising position

I've written about the immigration issue in this country a few times previously (here, here, and here).  Today, it looks like there may be some progress on getting some sort of immigration bill passed.

This issue has been really affected by polarizing politics in this country.  There are factors of declining real wages of the lower and middle classes, large influx of illegal immigrants who are willing to perform lower wage jobs, employers willing to violate the law in order to hire lower wage workers, concerns about cultural fragmentation due to an influx of people who don't speak English or follow other American traditions, entangled thoughts about national security from open borders, and much more.  Any solution short of deporting all 12 million illegal immigrants runs the risk of being branded as amnesty (which, I guess, is a bad word to some).  At the least, most people would agree that people who came here illegally shouldn't get an advantage in becoming a citizen over someone who tried to follow a legal process.

And, we have at least 12 million mostly-hard working people who have settled here and become part of our communities.  Do we really want countless raids going on in this country, separating illegal immigrants from their US-born (and US-citizen) children, as we try to send them all somewhere else?

I'm glad to see that there seems to be some spirit of compromise, starting with President Bush (whom I almost never agree with).  He convinced some Republican Senators to re-start this issue.  I agree with Bush that the status quo is unacceptable.  We need to reconcile ourselves to some solution that addresses this issue.  It's way too complicated for everyone to be satisfied with the ultimate legislation.  In fact, I am sure that no one will be satisfied with the result.  But, it's going to be better than the status quo.

There hasn't been enough compromise in today's political climate.  This has led to either bad policy or stalemates.  In the end, we all lose.  We can gain much more if we have spirited debate and all try to form a workable solution.  There's always the next legislative session to try to make it better.  The status quo, on so many issues, is unacceptable.

Here's a quote from Ronald Regan on compromise.  He seems very practical in today's context:

"When I began entering into the give and take of legislative bargaining in Sacramento, a lot of the most radical conservatives who had supported me during the election didn't like it.

"Compromise" was a dirty word to them and they wouldn't face the fact that we couldn't get all of what we wanted today. They wanted all or nothing and they wanted it all at once. If you don't get it all, some said, don't take anything.

"I'd learned while negotiating union contracts that you seldom got everything you asked for. And I agreed with FDR, who said in 1933: 'I have no expectations of making a hit every time I come to bat. What I seek is the highest possible batting average.'

"If you got seventy-five or eighty percent of what you were asking for, I say, you take it and fight for the rest later, and that's what I told these radical conservatives who never got used to it.

Hosting by Yahoo!

June 19, 2007

The Daily Show explains Bush's Middle East Strategy

Couldn't resist this one.


Hosting by Yahoo!

June 15, 2007

The Daily Show Strikes Again

I love The Daily Show and The Colbert Report.  These shows give great insight into the news while being very humorous.  And, they often point out the weaknesses in 'real' news coverage.  There's nothing like 'fake news', and I watch every morning during the week when I work out.

Here's a video from yesterday's Daily Show that captures the spirit of what they do.  Why don't other media outlets hold politicians responsible when they contradict their previous claims?  Note that this video will only work unitl July 15, according to Comedy Central.  After that, you'll have to trust me that it was pretty funny as well as being a sad commentary on the integrity of Tony Snow.


The video is also available here.


Hosting by Yahoo!

May 16, 2007

Checks Unbalanced

The wheels of government generally move slowly.  I think that is a good thing.  One thing that slows it down (or should) is the knowledge that decisions and actions can be reviewed under a healthy system of checks and balances.  Knowing that the spotlight will be turned on you keeps you honest.  In start-ups, we often talk about the Wall Street Journal test -- would you want this decision or action reported on the front page of the Wall Street Journal?  If not, don't do it.

I try not to rant too much about the Bush administration on this blog, but today the latest breach of checks and balances has come to light.  As reported here, President Bush, then White House counsel Gonzales, and Chief of Staff Card overruled the Attorney General and went ahead with an aggressive domestic wiretapping program.

Now, if John Ashcroft thinks that a program tramples on civil liberties, it's got too be overreaching.  However, Bush and Gonzales went ahead and authorized it anyway.  Finally, as the Democrats have re-taken Congress, we are seeing checks and balances in action.  These decisions and out-of-balance approaches are coming to light.  There was virtually none of this Congressional oversight in the Republican controlled Congress in the first six years of the Bush administration. 

No matter who gets elected President in 2008, we need a more open and ethcial administration that will cooperate with Congress to ensure that our system of checks and balances remain in force.  It's for all of our benefit.

Hosting by Yahoo!

March 27, 2007


Dealing with illegal immigration is something that has been on my mind lately.  It started with the raids in New Bedford.  What bothered me most was the treatment of families and children when their parents were detained.  Despite an attempt at coordinating with the state of Massachusetts, in the end, children were separated from their parents and left without care.  This could have been prevented without compromising the goal of the raid.

I recently found out about Endgame, the Department of Homeland Security's plan to remove ALL the illegal immigrants from the US by 2012 (or, as an update (see page 10) to the plan states, 2009).  This is somewhere between 8 and 12 million people removed from the country!  Do we really want to spend our tax dollars on this?

I am all in favor of enforcing our laws, but this is closing the barn door after all the animals have left.  We have US citizens that are the children of many of these immigrants.  They are mostly hard working people who are not threats to our country.  Endgame has nothing to do with terrorism (although preventing terrorist attacks is listed as the number one goal).  We have to deal with the reality of the situation, not some posture we wished was true.

I find it ridiculous that nothing in Endgame has anything to do with punishing the employers who provide jobs (and motivation) for illegal immigrants.  We should be putting these people out of business.  If employers stop offering jobs to illegal immigrants, many fewer will come.

We can't do a sudden crackdown after years and years of lax enforcement.  We have to have a more sane and humane way of dealing with the law abiding illegal immigrants who are here.  They should have some way to earn legal status.  It doesn't have to be easy or be amnesty.  But, it should be able to be accomplished without disrupting communities and families.  We also need to crackdown on employers and continue to have tight enforcement on the border.  We'll never eliminate all the illegal immigrants or totally stop their entry into the US.   But, we should be able to peaceably make a big dent.

Hosting by Yahoo!

March 15, 2007

Immigration crimes and victims

I've been tracking the story about the immigration raid in New Bedford, MA on March 6.  The short summary is that the federal government planned a raid on a factory in New Bedford that had hired many illegal immigrants.  This factory, ironically, was making backbacks for the Department of Defense.  However, many of the people arrested had dependent children at home who were left behind as the illegals were sent to Texas for processing. 

I strongly believe that we need to crack down on employers who hire illegal immigrants.  If it is hard to get a job here as an illegal immigrant, fewer illegal immigrants will come.

I also think that illegal immigrants run the risk of being prosecuted.  We have been so lax for the past 20 years or more that it's hard to crack down now.  But, the mood of the country has stiffened on this front, and illegal immigrants know that they could be deported if caught.  My personal feeling is that we should be very tolerant of hard working immigrants as they generally add more to our society than they cost us.  The US was strengthened by the big wave if (legal) immigration in the late 1800s through early 1900s.  But, until the laws are changed, illegal is illegal.

Two things happened here that shouldn't have:  First, but less importantly, the factory was still in business the day after the raid, making their backpacks for the Department of Defense.  The federal government should have put this guy out of business, or at least cancelled all his federal contracts.  The employer committed the much more significant crime than the employees, in my opinion.

But, the real crime was how the federal government treated the immigrants, particularly those with small children.  According to the Massachusetts officials, the state had coordinated with the federal government to have social services people involved with those arrested to ensure that any dependent children were taken care of as the illegal immigrants were processed.  At the last minute, it appears that the federal government did not allow this and went ahead with the raid.  Mothers, including those who were nursing their babies, were arrested and sent to Texas.  No access was given to them by social services.  One seven year old child at home called a hotline to report that his mother never came home.  Some of these children are US citizens as they were born here (that's also a law!). 

This wasn't a national security matter.  Other than a flight risk, these people didn't represent any threat to the community or to others.  There was no reason to whisk them off to Texas before making sure that their children were taken care of.  The children are not criminals.  The federal government of course, called the factory a 'crime scene', which is the reason why the social services people were not allowed there.  They never apologized or acknowledged that their handling of the matter was wrong.

As a society, we need to protect our children and those who can't take care of themselves.  To leave these children scared, hungry, and unattended was the real immigration crime here.  Shame on us all if we let this happen again.

Hosting by Yahoo!

March 03, 2007

A New Low

Ann Coulter stooped to a new low in a recent speech.  Fox News reports on it here.  You can watch the video on the John Edwards campaign site here.  I'm not advocating that you give money to Edwards's campaign, but that's the first place where I found the actual video.

I hate it when politics stoops to personal attacks.  I think that it turns off voters.  Even staunch conservatives gain nothing by calling candidates 'faggots.'  If she thinks that Edwards is gay, I think that there is clear evidence to the contrary.  If she thinks he is weak-willed and spineless, she could just say that.  To use such a derogative term guarantees that she'll get coverage, but also drags the discussion into the gutter.

I wish that the press had the guts to ignore such hateful speech.  Only then will people like Coulter stop doing this in desperate attempts to call attention to themselves.

Hosting by Yahoo!

February 20, 2007

OK, now I'm old

We all have those moments when we realize that we are older than our self-image.  Beyond life's mileposts (graduation, marriage, parenthood), there are times when we figure out that people who were always younger than us who are now older.

Today I realized that, for the first time, a serious Presidential contender is younger than I am.  Barack Obama is almost exactly three months younger than me.  I don't know if he'll win, and I don't know if I would vote for him.  But, he's a contender.  And, I am no longer as young as I always thought I was.

Hosting by Yahoo!

February 01, 2007

Be very afraid...

Unlike today's other story of the Boston bomb scare/hoax/marketing ploy, the story of what the CIA did to Khaled al-Masri is really scary.  If you haven't read this, you should.  Any of us could be next.

It seems like Khaled al-Masri was kidnapped by the CIA because he has a name similar to Khalid al-Masri, a member of al-Qaeda.  Now, if they had detained him, questioned him with some sort of due process, and released him when they figured out that they had the wrong guy, that would be understandable.  How long would that have taken -- days, weeks?  Khaled was detained for five months after being picked up in Macedonia, beaten, drugged, and taken to an Afghan prison.  This guy is a German citizen who happened to have the wrong name! 

I am all for interrogating suspected terrorists.  But, we can't treat anyone like this.  I think that we win in the world if we show everyone our high ideals and regard for human rights (or how my ideal America regards human rights).  Even someone wrongfully detained could understand a mix-up.  But, if they are drugged, beaten, and raped, as Khaled al-Masri claims to be, then our CIA operatives are subject to arrest in Germany.

How do we get Germany to support our anti-terror efforts if we treat one of their citizens like this and then release him only after he agrees not to tell anyone of his detention.  He was dumped in Albania with no money and no apology.  It's a disgrace.

Of course, this story has played out hundreds of times over in Guantanamo Bay.  We need to put the detainees we still have on trial or release them.  Enough is enough.

Commitment to human rights and proper treatment of prisoners and suspected terrorists is one thing I'll be looking for in the next Presidential election.  I am all for being tough on potential terrorists, but we need to do this within the bounds of due process and with respect for himan rights.

I hope that there is no terrorist named Michael Finestine some day.  If there is, I could end up in an Afghan prison, too.

Hosting by Yahoo!

January 23, 2007


If you like national politics, check out  Content looks interesting.  I heard about it in an NPR OnPoint podcast today.
Hosting by Yahoo!

Which is the real Romney?

There has been a lot written about how former Massachusetts Governor Romney has shifted to the right to woo more national conservative voters who would be otherwise put off by his Massachusetts pedigree.  Although I didn't vote for Romney when he ran for governor, I didn't think he would do a bad job.  He is a venture capitalist and had done a good job on big projects, such as the Salt Lake City Olympics.  When Romney focused on something, such as the collapse of the Big Dig tunnel ceiling, he got results.  Maybe he should have had more competent people monitoring the Big Dig all along, but that project was a mess for a long time before he got into office.

Anyway, once Romney decided to run for President, he has tried to portray himself as more conservative.  The contrast in the Scott Lehigh column referenced above is very illustrative.  For me, the most important (and most elusive) trait a candidate can have is integrity.  I want to vote for someone who has some core beliefs, tells me what they are, and then follows-through on them after they are elected.  Even though I never voted for Reagan, I always felt that he told America what he was going to do, and then did it.  Pretty rare these days.

Not only has Romney pulled a major U-turn on social issues, he has tried to discredit Brian Camenker, a conservative activist who has taken Romney on.  Camenker has highlighted that Romney hasn't always described himself as a conservative.  I am no fan of Camenker.  And in this Press Release which has been removed from the index of Mitt's Web site, Romney doesn't like hearing what Camenker thinks of his record.

The funniest aspect of the Press Release is the link to this video in which the Daily Show's Ed Helms interviews Camenker and pokes fun at his stridently conservative social views.  But, are these views different than the ones that Romney is trying to embrace?  Maybe this vicious circle is why Romney removed the de-bunking of Camenker from his web site.  Even Romney is confused about whether or not he should align himself with this staunch conservative.  To the old Romney, the answer would be clear.

Hosting by Yahoo!

January 19, 2007

Freedom from/or terror

Ever since September 11, 2001, we have wrestled with the issue of how much of our freedom we are willing to give up in the name of keeping ourselves safe.  This is a fundamental issue for every society.  This isn't a recent phenomenon.  Abe Lincoln suspended habeas corpus during the Civil War.  The US (and Canada) interred Japanese civilians during World War II.  So, there was plenty of precedent for the Bush Administration to also suspend habeas corpus and to push for passage of the USA PATRIOT Act.

I recently saw two news articles which got me to think about this issue again.  First, we learn that antiwar protest groups were initially put on the list of terrorist threats, and then President Bush gave in to use the FISA court to obtain wiretaps on potential threats.

The tracking of antiwar protest groups as potential terrorist threats has been stopped, or so we're told.  Who knows what other types of tracking and information gathering is continuing?  Our fundamental right is our freedom of expression.  We should all rejoice in this and protect it dearly.  Who knows if the government is keeping track of this blog posting as it is negative about the Bush administration?  I'm not willing to give up on our freedom of expression in the name of safety.  We are in much more danger if we fear for what we say or who we meet with.  We need a government that values our society's freedoms, too.  I recently saw Good Night and Good Luck on DVD.  It's chilling to see how people feared the McCarthy hearings and how that changed people's day to day interactions.  The country was much weaker because of this, and thank goodness McCarthy was discredited and the witch hunt ended.  Hopefully with the Democratic Congress the tide has turned on the government's ability to quell our right of free expression.  But, I don't think that this issue is dead by any means.

The privacy issue is equally important, but more complicated.  First, with today's digital economy, we have all voluntarily given up a lot of private information, leaving us suceptible to identity theft and tracking.  You have to be very vigilent to keep your personal information under control.  There are probably some business opportunities in developing products and services which help consumers in this area.  The government also needs to refrain from gathering and tracking our private information, unless they have a warrant due to probably cause.  Some sort of check and balance system is needed, and the FISA court never seemed to be an obstacle to wiretapping potential threats before.  To me, the argument here was much more about flexing Presidential muscles and changing the balance of power rather than getting wiretap warrants fast enough.  There was already a provision in FISA to wiretap first and get the warrant immediately afterwards.  How much faster response did they need?

Terrorism is scary, and we live in a world where there are real threats.  But, isn't the compromising of our fundamental rights even scarier?  I don't think we need to choose between Freedom or Terror in order to have Freedom from Terror.  In fact, our freedom should be a beacon to counteract the negative images of us that some of our terrorist enamies use to recruit new members.

Hosting by Yahoo!

January 09, 2007

Fresh start

2007 should be an interesting year.  I am embarking on a new career direction, to be determined.  Maybe I'll stay in venture capital, but I am also considering consulting to start-ups or full-time operating roles.

It's also a time for a fresh start in Massachusetts politics.  Deval Patrick is our new governor.  He seems determined to take a new approach.  I like the fact that he seems to be willing to hold back on some of his promises in the name of fiscal responsibility.  I like his visionary approach, but I hope he can match it with a tight management style.  Massachusetts voters have selected Republican governors for the past 12+ years (Weld, Cellucci, Romney) to balance off the Democratic legislature.  The Republicans have generally been moderates, although Romney is tilting hard right as he runs for President.

I'm hopeful that someone will emerge as a Democratic Presidential candidate who can be just as visionary but still a strong manager.  Bill Clinton, at his best, was able to do this.  He kept the Democratic base in the boat while he maintained fiscal discipline.  I don't think that Hillary is electable as too many Republicans have a strong negative reaction to her.  Perhaps Obama has these qualities, but he seems too inexperienced.  I liked Mark Warner, but he dropped out.  Any other ideas?

I am hopeful that 2007 (and 2008) will be a year of fresh starts.  I'm trying to get a fresh start in blogging, too...

Hosting by Yahoo!