Letter to Senator Obama
Congratulations on your milestone victory yesterday. I can’t begin to express how proud I am of you and our country on a whole. You ran a flawless campaign and have inspired millions across the United States. Although your election was monumental, now comes the hard part.
You’ve certainly inherited a mess. Our nation is embroiled in two wars: one in Afghanistan and one in Iraq. Our financial system is in shambles, ranging from continuous Wall Street meltdowns to the Political entangled Fannie/Freddie to soaring American household debt. There is a lot to fix, and it’s not going to be easy.
So, if I might impart a few ideas for you to chew on as you plan your move to Washington DC:
Build a Bi-partisan Administration. Take time to select the right cabinet members to help you forge a better future, not just focusing on tomorrow, but also on the ten years to come. Look to bring on opposing views to your administration – balance is key.
Simplify our Tax System. Reagan started this in the 1980’s, but there is still a ways to go. There are clear needs for immediate tax hikes (within reason), but another source of capital can come from simplicity. Sit down with Steve Forbes and hear him out; maybe even appoint him to your Cabinet. Be careful with your treatment of capital gains taxes. We must encourage investment and entrepreneurial spirit. Small businesses run our economy and many start small businesses with the hope for eventual payouts.
Be Careful with Regulation. Poor financial regulation is, in large part, what got us in this financial mess. Government oversight and regulation is a two edged sword. As you look at fixing the chaos we’re in, remember that our system of beliefs is rooted in small government and freedom of business.
Approach Healthcare Reform Cautiously. It’s clear that our system is broken, but there are many lessons to be learned from the drawbacks of nationalized healthcare in other countries. Countries with health systems based on greater government control tend to have more obstacles to care, such as long wait times, rationing and restrictions on the choice of doctors. Be wary of rampant administrative costs. Regardless of the outcome, at a minimum, we need to focus more on preventive care rather than reactionary medicine.
Support the Freedom of Choice. Our nation was built on the premise of the separation of church & state. Uphold this. Americans should have the right to choose. Abortion is not a religious discussion. Gay marriage is not a government’s decision. We are a nation of immigrants with different beliefs, backgrounds, languages, and should all have the right to not see our government impose on those individual rights.
Invest in Alternative Energy Research. Release us from foreign energy dependence. This will take time, but we should start now. We don't even need to spend that much on research to make simple changes to our energy policies. In addition to alternative energy, we should work on solving on foreign dependence now by migrating to existing solutions, even if not perfect. Drill at home, nuclear energy, etc. The policy needs to be comprehensive and have a 20+ year outlook. Incentivize the auto industry to innovate.
Maintain Free Trade. We live in a global economy. Imperialistic barriers cannot make any sense moving forward, however beneficial to the American worker in the short term. Competition will only make us stronger and better in the long run. Since our early days, this has been one of the main tenets of our economy. The colonies which became the United States generally supported free trade; indeed British restrictions on trade were a major factor in the war for secession.
Reform Campaign Finance. There is no longer any reason to for our electoral college system to exist. But, understanding that changing our electoral process would be a challenging undertaking given the embedded political interests, I encourage you to do what’s right and support substantial campaign finance reform. We, as Americans, do want change. And, we also want choice. Having to choose from two parties not only minimizes the potential change we see, but also narrows the field of possibilities.
Focus on Education. This is our future, our children’s’ future, and our nation’s future. Do not spare a dime on this matter. Come up with a plan to improve the quality of our teachers and our school systems. Sit down with Mark Warner (VA) and hear him out. Not only would investing in better public education would prove critical to helping the United States emerge from tough times stronger than ever, but it is the foundation for innovation that has driven us during the past century. Improved education would help us elect better officials, make smarter decisions, live healthier stronger lives, and cope with change as it’s needed.
Support our Immigrants. We have always considered ourselves the “melting pot,” driven by the rich tradition of immigrants coming to the United States looking for something better and having their cultures melded and incorporated into the fabric of the country. “Give me your tired, your poor, your huddled masses yearning to breathe free…” These are the people who are, have been, and will be the driving force of our country.
Listen to the People. During your acceptance speech you stated: “I will always be honest with you about the challenges we face. I will listen to you, especially when we disagree.” This was quite possibly the most critical statement you have made, in my opinion. If you can stick to this, I believe you will, I have no doubt that you will succeed.
I hope this letter gets to you and that you can, at least, acknowledge one more opinion out of the millions of opinions that you’re receiving every day.
It's Time
The
Economist published a fantastic commentary on the US Presidential Election last week that is a very worthy read. It's an extremely well articulated and thoughtful analysis on the election, the candidates, and their respective strengths & weaknesses, most of which is hard to dispute.
Memory is Fleeting
Just yesterday, a friend of mine sent me this New York Times article dating back to September 1999. Yes, 1999. Interestingly, the article,
Fannie Mae Eases Credit to Aid Mortgage Lending, discussed how Fannie Mae decided to ease the credit requirements on loans that it would purchase from lenders after coming under pressure from the Clinton Administration. Ahem.
Humorously enough (if we can even provide some levity to the terrible state we're in), the writer of the article can proudly say, I told you so.
In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980's. "From the perspective of many people, including me, this is another thrift industry growing up around us," said Peter Wallison a resident fellow at the American Enterprise Institute. "If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry."
How soon we forget.
A lot of people want to point fingers and place the blame, but I'd like to point out that "Wall Street" or "Investment Banks" are not singular entities who control policy or team under a joint modus operandi. The blame can be squarely placed on policy makers here. And, given the date of the aforementioned article, I'll let you choose which policy makers we're talking about. A lot of things have gone wrong over the past years but, generally speaking, poor execution comes from poor leadership & subpar planning.
One thing is for certain (in my humble opinion), bigger government and more policy will not help us get out of this mess in the long run. Frankly, it's what got us in this mess in the first place.
Mauldin on Energy
John Mauldin comments on the US energy policy in a recent newsletter subsection called
Some Thoughts on Energy. This is a great piece. He presents some great analysis and solid opinions. This passage sums it all up:
Either we are going to see the economic life sucked out of this country, or we can respond by doing everything that is in our power. There is not a shortage of energy. There is a shortage of leadership to produce the energy we need. A real energy policy would also have the benefit of boosting the beleaguered dollar.
Net. Net. We just need to start investing today, across the board, in all facets of cleaner energy, and in domestic natural resources. Period.
Alternative Energy Research
Leo Tolstoy once said: "The struggle with evil by means of violence is the same as an attempt to stop a cloud, in order that there may be no rain."
The US Government spent nearly $440 billion on military expenditures for the Department of Defense during fiscal year 2007. In 2008, the proposed spending increased to over $480 billion for the same subject matter. Of that amount, from what I've read, the US spends roughly $67 billion annually on this war.
In contrast, the US spends a mere $3 billion on energy research each year, according to the National Science Foundation. DARPA, the Defense Advanced Research Projects Agency and the creator/inventor of the Internet (computer networking and hypertext) amongst other things, manages a roughly $3 billion budget as well. This is the agency of the US Department of Defense that has been responsible for funding the development of many technologies which have had a major impact on the world, in past years...
President Bush currently says that he is seeking about $10 billion for alternative energy research over the next five years as part of his proposal to reduce U.S. gasoline usage by 20 percent by 2017. You have got to be kidding, right?
Albert Einstein once said: "The problems that exist in the world today cannot be solved by the level of thinking that created them."
It doesn't take a genius to realize that you're always better off solving the problem at the root cause (foreign energy dependence) rather than patching solutions (imperialism and aggressive foreign policy). This is such a exhaustive subject, but I'm hoping that the more we mention it, the more likely we spend our tax payer dollars on fixing the problem sooner rather than later.
We don't even need to spend that much on research to make simple changes to our energy policies. In the 70s, France migrated substantially away from oil and now generates about 75% of its power from nuclear power plants. That's worked successfully for them for nearly 30 years. In the US, in contrast, over 70% of our energy is derived from coal, petroleum, and natural gas. Although nuclear energy isn't ideal, it doesn't produce the air pollution that burning natural resources does and it unshackles us from a dependence on the Middle East. And, the technology is here now; including impressive solutions for nuclear waste remediation.
What do you think would happen if we tripled our annual energy research budget? Would we come up with a better solution than ethanol sooner? Would we have a better solution to our high consumer gas prices than the Prius? Possibly, probably... Considering the relative spend in the context of our war funding, it would seem like a smart diversion of funds if you ask me.
Demographics of Social Networks
Forbes has an interesting
article on the differences between users at Facebook and users at MySpace - arguing that the demographics differences are splitting among class lines.
Affluent kids from educated, well-to-do families have been fleeing MySpace for Facebook since it opened registration to the general public in September, while working-class kids still flock to MySpace.
This is an interesting notion, but I wonder if it hold up. Isn't the Internet the great equalizer?
I've touched on the subject of the natural
evolution of multiple social networks when I referred to Danah Boyd's essay. To touch on the subject again, I'm sure there is a lot of room for continued evolution and I think it's still to early to determine what the real differences will be between Facebook and MySpace. I'm still curious as to the evolution of the likes of Friendster, ASmallWorld, LinkedIn, Hi5, Orkut, Bebo, Bolt, Tribe, Rapleaf, doostang, AsianAvenue, BlackPlanet, GLEE, MiGente, and others that have yet to come about.
Empowering the Enterprise End User
This is probably not an entirely new topic, but I've been thinking about it for the past couple years. It's on the subject of choice in the enterprise IT department. I was tempted to call this post "The Rise of the Stupid Enterprise" but I figured that might be mis-construed. David Isen had it right as it related to the decentralization of communications networks. I believe that a version of this decentralization will happen to the CIO's office.
The software industry is emerging from a painful depression and entering an era where software as a service is without a doubt one of the most important innovations we've seen in a long time. That movement away from expensive client-server solutions & wide-scale enterprise site licenses to user-specific hosted solutions by third parties is rapidly changing the way enterprises buy software. It's enabling & empowering the end-users to identify, select, and adopt more quickly and, most importantly, act without having to rely on the IT or MIS department. What's this? Decentralization.
Wherever standards have been established, this trend is likely to take continue. We've seen it start with CRM, but I think that other enterprise apps are only inches behind. Tools such as VoIP and Mail/IM clients, ERP and SCM interfaces, and even business productivity suites, could become more influenced by end users, rather than mandated by IT / MIS. Movements such as SOA will only further distribute choice down from corporate to the business line to the end user. Bring it on! The enterprise software industry is entering the Age of Decentralization - let's keep empowering the end user.
Intellectual Happy Hour
Jack Welch posted a column in the April 23, 2007 issue of BusinessWeek that's dear to my heart. He posits that the US faces a "brain drain" from the "best & the brightest" MBA's electing to work for private equity firms & hedge funds rather than taking management roles in operating companies. This is a real problem in my opinion, and I wrote a thesis on the subject nearly ten years ago. I suggested that the "best & the brightest" undergraduate engineers were electing to work for consulting or investment banking firms rather than taking product development roles in operating companies.
That same BusinessWeek issue had a wonderful
article on the race to build an affordable car. That sounds like a losing proposition to any one of the major OEMs today if you ask me. Given the corporate overhead, expertise, & current troubles at the likes of GM, Ford, Daimler, Renault-Nissan, Chrysler, etc, a $2,500 car initiative couldn't be any less appealing to me as a shareholder. Why would you ever move downstream? Again, these sorts of decisions just highlight the incompetent managment of these organizations... it's not about volume folks, the game is profits!!
And,
Metcalfe has a fun read in Forbes on network effects and the evolution of computing & the human mind.
