Wednesday, July 21, 2010

Christians Behaving Badly

I'm usually not very interested in celebrity news, but Mel Gibson's recent rantings made me wonder about something. Let me illustrate:

- My wife had her rental car damaged in a parking lot in Minnesota by the wife of a professor of religious studies at a Lutheran college there. When the car rental company demanded compensation for the damage from my wife, she referred them to the woman who caused it. She and her husband initially denied they were responsible, then avoided phone calls from both the company and from my wife until my wife finally threatened them with legal action.

- A former neighbor sold a house on our street with a septic system that was on the verge of failing. The symptoms were clear but the former neighbor failed to disclose the problem, leaving the new owners with an unexpected $20,000 bill. The former neighbors claim to be devout Christians.

- Need I mention Catholic priests?

You would think that people who publicly proclaim their faith would feel some responsibility to live up to the values of that faith, but in some cases it seems the opposite is true. Why is that? Do some Christians feel that, because they're essentially good and moral people, anything unethical they do is OK because they're still good people underneath? Or does the weekly trek to church relieve them of their sins so they can pile more on during the week? Does bad behavior in the secular world not count for much in the spiritual world?

Some right wing Christians, including my mom, seem to think that all morality stems from religion, so atheists can't be trusted because they lack a moral foundation. Like many things, I think this notion is supported more by faith than by evidence.

Thursday, July 15, 2010

Dear Facebook:

I recently got an email from a Facebook member who I must know from somewhere, with a bunch of recommendations from you of other people I might know. I was curious about how you knew so many people I've encountered in my life, particularly since there wasn't much in common between them: some personal and some business, some here and some from my previous home... I wondered how you knew. IP addresses? Mining public data bases?

So I did a quick Google search and found several hundred posts on numerous forums from Facebook members who were wondering the same thing: how do you know? How do you dredge up someone that a person met in a bar ten years ago and offer them as a friend recommendation? Or an ex-husband, or a stalker? How do you offer a forty year old guy as a potential friend for a sixteen year old girl?

But here's the thing, Facebook: I'm not on you. I'm not a Facebook member, and I have no interest in becoming one. So while your own members find this, let's generously call it "prescience", somewhat creepy, getting a bunch of eerily accurate recommendations from you without having first opted in to your social network asylum is almost scary.

Based on my quick search, I suspect that what you're doing is suckering new members into uploading their address books so you can mine them for new customers. So let's say that Jay and Nancy both have my email address. As some point, then, I get an invitation email from you suggesting Jay and Nancy as potential friends. It may not matter to you that Jay is a psychotic sociopath who claims to be "electrosensitive", rants about radiation from cell phone towers, and has my email address because I once attended a community meeting about cell coverage. Or that Nancy is a consulting client who likes to keep her professional and personal relationships as separate as possible, and co-mingling them may put my professional relationship with her at risk. As far as you're concerned, if someone has my email address, that person is likely to be a potential friend.

Facebook, this is one of those cases where you can have too much of a good thing. When your marketing efforts start reaching past the fruitful fields of friendship into the murky swamp of indeterminate and potentially damaging connections, it suggests that your business model has run out of steam, that growth is at an end, that your valuation has probably passed its peak. Probably should have gone public a couple of years ago.

Sincerely yours,


Sunday, July 4, 2010

How Ronald Reagan Killed America

The June 14/20 issue of Bloomberg Business Week has a summary of why several prominent economists and analysts who have been bearish through the past few decades (in some cases) are still bearish now. At the end is one exception: James Grant, publisher of "Grant's Interest Rate Observer". The article states: "'We observed this in the recessions of 1991 and 2001, which were meek and mild, and so were the corresponding recoveries.' The deep recession of the early 1980s, on the other hand, led to a spectacular recovery. Based on that, Grant believes the rebound from this recession will be job-rich and strong, a position he has stuck to for nine months now."

My intent here is not to pick on Grant, but rather to use this as an opportunity to point out that a lot of economic analysis seems to want to treat the economy like the weather: a complex system that is hard to predict, but that does exhibit historical patterns because it's self directed. This may be true of weather, which has relatively few inputs. But economies are not self-contained forces of nature, but rather complex systems that are tightly coupled to many influences: demographics, technology, politics, and so forth.

So let's take the "spectacular recovery" that followed the recession of the early 1980s. Many people would like to credit Ronald Reagan with that recovery. The analysis quoted above would like to treat it evidence that the deeper the recession, the stronger the rebound. But what else happened in the mid-1980s?

One thing that happened was the personal computer revolution, which kicked off a wave of infrastructure-level capital investment and yielded tremendous operating benefits in almost every industry that continue today. Surely that had something to do with this recovery? And perhaps the subsequent emergence of the internet, another infrastructure-level transition that required, again, tremendous investment as everyone from corporations to grandmothers built web sites, had something to do with the recovery in the 1990s?

I don't think it's merely coincidence that these massive technology advances and infrastructure-level transitions happened at about the same time these recoveries did. So I have to ask, what infrastructure-level technology is on the cusp of maturity today that will lead to a wave of investment and operating benefits over the next ten years?

Frankly, I can't think of one. And without one, I don't think we're going to see a recovery like we did in the 1980s and 1990s.

Where should we be looking for such an opportunity? Well, the government cultivated the nascent semiconductor industry in the 1960s that led to the computing revolution of the 1980s and beyond. The government cultivated the internet in the late 1960s and early 1970s, and we started reaping the benefits twenty years later. So to find the maturing technology that will pull us out of the current recession, we should look to the 1980s.

One class of technologies that would fit the bill and was just getting off the ground at that time was renewable energy. At least, it was until Reagan killed government investment in renewable energy programs. Renewable energy is, like computing and the internet, and the national highway system, electrification, water, communications, and railroads before, an infrastructure-level technology that would require massive current investment and reap massive future rewards. Had Reagan not halted government investment in such technologies, we would probably now be on the verge of transitioning from fossil fuels to wind and solar. We might be burning our garbage for energy rather than burying it in landfills. We might not be intimately entangled in the Mideast and a target of terrorism. We might not have a uncontrollable oil well dumping untold amounts of crude into the Gulf of Mexico.

Instead, all of these are happening, and we have no long term strategy for solving these problems. For the foreseeable future, we'll be dependent on a finite and dwindling resource that pollutes our air and water, and that's largely controlled by entities who may not have our best interests at heart. As the world's biggest consumer of oil, we have the most to lose when it gets expensive and rare.

But perhaps more important than all of this is that, without another maturing infrastructure-level technology waiting in the wings to fuel the next wave of economic growth, we may not have a next wave for a long, long time. Without such a wave, there's nothing to stimulate growth except more borrowing. Without such a wave, there's no mechanism for organic job growth. And the one person most responsible for putting us in this position is Ronald Reagan. I predict that in thirty years or so, it will be widely recognized that he was the one who killed America.

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