December 1st, 2010 - 2:32pm
Six months ago Gen Next spent a day with the Navy SEALs in San Diego, and it's remembered by those who went as a rigorous, humbling, patriotic, and poignant experience. Some Members called it "life-changing". It wouldn't have happened without Lucas, Trevor, and Mike-the three heroic men who led us that day.
Right now they're in our hearts and thoughts as they fight overseas. This holiday season, to give them a little taste of home, Gen Next Members rallied to send them care packages filled with food, drinks, games, luxury cigars, and more. We can only hope that the packages will provide a bit of joy as they spend the Holidays away from their friends and family.
Cheers to our SEALs. There are not enough words to thank them for their service. We look forward to their safe return.
November 8th, 2010 - 1:11pm
Filed under Economy
Gen Next Member and Inrix CEO Bryan Mistele was recently featured on "60 Minutes". Lesley Stahl interviewed him on the potential impact an income tax in the state of Washington would have on small business, if the bill were passed. The debate has national implications as law makers continue to argue over various policies aimed at increasing much needed revenue.
November 8th, 2010 - 1:02pm
Filed under Economy
Indeed, markets are beginning to recognized that the Fed will has decided to monetize Treasury debt in an effort to rearrange the proverbial deck chairs on the Titanic.
Almost immediately, a backlash exploded from foreign central banks. China, Brazil and Germany on Thursday criticized the Fed's yesterday, and a string of East Asian central banks said they were preparing measures to defend their economies against large capital inflows. But what does they mean by "defend against large capital inflows?" Quite simply, market participants will begin dumping dollars in anticipation of the dollar's imminent depreciation and potential for inflation leading to an appreciation of their currencies.
The Chinese central bank called unbridled printing of dollars the biggest risk to the global economy and said China should use currency policy and capital controls to cushion itself from external shocks. "As long as the world exercises no restraint in issuing global currencies such as the dollar - and this is not easy - then the occurrence of another crisis is inevitable, as quite a few wise Westerners lament," Xia Bin wrote in a newspaper under the Chinese central bank.
The Brazilian finance minister also weighed in warning of a "currency war", stating: "Everybody wants the US economy to recover, but it does no good at all to just throw dollars from a helicopter."
International tension of our central bank policy will likely to complicate US efforts to get leaders of the world's leading economies countries meeting in Seoul next week to press China to sign up to a new accord promising to limit current account balances.
Dan Price, partner at the law firm Sidley Austin and formerly George W. Bush's White House representative at the G20, said: "The US may find it increasingly difficult to galvanize countries to push China on [renminbi] appreciation when many think the Fed's quantitative easing policy is itself a major contributor to currency misalignment and imbalances."
Neither the Federal Reserve nor the US Treasury commented on Thursday. The tension over exchange rates has created fears of a wave of protectionist trade and investment actions in response, a reaction that so far has been markedly absent from the global economy during the recession and recovery.
Gen Next Member Pierre Prosper Negotiates and Wins Release of Fellow Member's Father Who was Unfairly Imprisoned in Iran
November 1st, 2010 - 10:17am
Filed under International Security
GN Member Ambassador Pierre-Richard Prosper negotiated the release of Reza Tagahvi--father of a Gen Next Member--from Evin prison in Tehran, Iran after being held for two years. Mr. Tagahvi was not officially charged with a crime during his captivity. Negotiations transpired over 14 months across several different countries.
Prosper and Taghavi were connected through Gen Next.
"We could not be prouder of Pierre for re-uniting the family. Our hearts go out to the Tagahvi family as they reunite after such a challenging experience," said Paul Makarechian, Chairman of Gen Next.
Prosper spoke with GN Members in Seattle on Oct 26, marking the first public remarks on the negotiations and release. Prosper served as a war crimes prosecutor for the United Nations International Criminal Tribunal for Rwanda, and he is responsible for setting the precedent that rape committed in time of conflict is now considered a form of genocide in international law. Pierre prosecuted the first ever case of genocide in the history of the world and went on to become the United States Ambassador-at-Large for War Crimes and Genocide.
For more on this story, please visit: Wall Street Journal
October 13th, 2010 - 1:03pm
Filed under International Security
Saturday October 9th will see the launch of Khudi, a grassroots social movement in Pakistan, established to promote the culture of democracy and counter-extremism through civil society activism.
Founded by Quilliam Co-Director Maajid Nawaz, Khudi is Pakistan's first nationwide counter-extremism social movement, which aims to create a platform for young Pakistanis to debate and articulate their visions of Pakistan, and to make these visions a reality through political and civil engagement.
Khudi's leadership consists of seasoned youth activists, who bring to the movement their tremendous zeal for social change, their experience and an extensive network of activists. Even before launching, Khudi's Facebook page has over 10,000 fans. Through organising events that range from critical thinking workshops, to conferences on the role of religion in the Pakistani public sphere, Khudi's work will focus in particular on questions of counter-radicalisation, counter-extremism, national identity, religious tolerance and democratic governance.
Maajid Nawaz, founder of Khudi, says:
"Khudi is working towards combating extremist ideologies and is committed to bringing Pakistan back to the model of a progressive, pluralistic and democratic country as envisioned by leaders such as its founder, Muhammad Ali Jinnah. This would not be possible without the energy and enthusiasm of the youth of Pakistan, who's dedication will ensure that extremists will not be allowed to dominate in Pakistan."
Speakers at Khudi's launch include:
Noman Benotman, a former leader of the Libyan Islamic Fighting Group and one-time associate of Osama bin Laden, he has since renounced the violent ideology of radical Islamism and has publically challenged al-Qaeda's ideology through an open letter to Osama bin Laden and Ayman al-Zawahiri. Benotman is now a senior analyst at Quilliam.
Oscar Morales, a Columbian anti-terrorism activist who has fought against FARC's activities in his native country by organising mass public movements against violence.
Maajid Nawaz, Khudi's founder and himself a former leader in the radical Islamist Hizb-ut-Tahrir (HT) group, Nawaz renounced HT's ideology while imprisoned in Egypt. He now fights for his vision of a progressive and pluralistic Islam, Co-Directing Quilliam, the world's first counter-extremism think tank based in London.
The event will be attended by Pakistani political leaders, officials, youth activists, civil society leaders, academics and media representatives. It will also feature the launch of Khudi's Pakistan-wide student-led Laaltain magazine, aimed at challenging extremism on campus and promoting democratic culture and the integrity of Pakistan's borders. Representatives of partner youth groups will sign a 'Statement of Vision', uniting them under the Khudi banner to work towards promoting democracy, fighting extremist ideologies and building a better Pakistan.
September 14th, 2010 - 3:37pm
Filed under International Security
On Thursday Sept. 2, Jared Cohen walked out of the Truman Building with his luggage for a final time, after four years on the State Department's Policy Planning staff, serving under both the Bush and Obama administrations. During his time in government, Cohen, who will be 29 in November, attracted much attention -- both praise and controversy -- for his unconventional thinking about statecraft: for calling on his friend Jack Dorsey to keep Twitter from going through with a scheduled maintenance shutdown during the heady days of the Iranian election last summer; for leading delegations of technology executives, including Google's Eric Schmidt, to troubleshoot problems in Iraq; and for tweeting his observations, with a touch some critics found too lighthearted, to his 300,000-plus digital followers.
Anne-Marie Slaughter, director of Policy Planning for the last year and a half, says his exuberance will be missed: "Jared's time with the Policy Planning staff was a period in which we moved from not only writing memos proposing new ideas, but also finding ways to put those ideas into practice as an initial proof of concept. We are known as the Secretary of State's think tank, but we have become a think/do tank."
In mid-October, Cohen will begin his new job as director of Google Ideas, a new division of the search giant that he is helping to launch. He will also be, as of Tuesday Sept. 7, an adjunct fellow at the Council on Foreign Relations, focusing on counter-radicalization, innovation, technology, and statecraft. Cohen is the author of two books, Children of Jihad and One Hundred Days of Silence, and despite his interest in all things new media, is also the owner of an extensive collection of rare books, presidential autographs, and 19th-century campaign memorabilia.
Cohen chatted with FP about his new gig at Google, what he's learned at State, where his interest in the intersection of technology and foreign policy began, and what he thinks his critics get wrong. Excerpts:
Foreign Policy: While you were a Rhodes Scholar at Oxford, you made your first trip to Iran for a research project. I understand that project didn't work out as planned, but the time you spent in Iran, which you later wrote about in the book Children of Jihad, spurred your inquiry into unexpected uses of technology. Tell us about that.
Jared Cohen: What I had wanted to focus on was interviewing opposition leaders, government officials, and reformers. I did interview the Iranian vice president and some opposition leaders. But the Revolutionary Guards came into my room in the middle of the night and found a list of people I wanted to interview. That made my original plan impossible, but ended up being one of the most important things to happen because in the absence of my original research being viable, I ended up just wandering the country looking for friends to hang out with.
It became very clear to me that I had gone to Iran wanting to study the wrong opposition. I became obsessed with this idea that the real opposition in Iran is the 67 percent that's under the age of 30, and all I wanted to do was meet as many of them as possible. Even the ones that are part of that counternarrative like the basijis and the pro-regime ones.
Where it became about technology was I had this experience: I was in Shiraz, in the south, at one of these very busy intersections and all these kids --- there was five or six different alleyways all meeting, it was a very, very busy part -- and it was filled with kids perched against the sides of shops all looking at their cell phones. And I asked one: "What are you doing?"
And he said "Oh, this is where we use Bluetooth." He was trying to explain, "This is how I'm figuring out what I'm doing tonight." Another person was trying to recruit a bassist for their band; only one or two doing something that could be loosely interpreted as doing something politically relevant. It was mostly social and recreational. I asked one [youth]: "Aren't you worried? You're doing this right in the open; aren't you worried you're going to get caught?" He looked at me and said, "Oh, nobody over 30 knows what Bluetooth is."
The conclusion I came to there is there's two gaps: There's a generation gap between young people who are socialized and brought up with these technologies and an older generation that's coming a bit late to them (and that questions them before they embrace them); there are downsides to both. And there's an innovation gap between companies that innovate for luxury environments -- i.e., free and open societies -- and repressed populations which use things innovatively.
FP: Let's talk about your time at the State Department. Could you pick one of the technology delegations you led and just narrate it? We hear a lot about "technology delegations," but don't really know what that phrase means.
JC: I might as well start with the first one. The first technology delegation [the State Department] did was in April of 2009 to Iraq: It was me and nine techies from the private sector, including representatives from Google and YouTube.
We met with senior government officials in and around Baghdad. Then we met with American troops, NGOs, private-sector companies, like cell-phone carriers. We met with professors and academics and academic administrators. We met with tons of students. I led the delegation, and it was staffed by people at the embassy; I was the only person from Washington.
I had a very good relationship with the public affairs counselor there, Adam Ereli, who is a really, really smart "push the envelope" kind of guy, who had pitched an idea to me to get some professors out [to Iraq]. Now, we [at the State Department] often lead delegations of academics and NGOs to countries around the world, but we hadn't led delegations of people with expertise on tools. So, I thought: Why don't we take a delegation of technology executives to Iraq?
The hypothesis was very simple: If you connect people that have expertise on tools with people that have expertise on Iraq, something innovative may happen. I just had an intuition this could lead to something interesting. It just sounded right, and the embassy thought it sounded right. The idea was: "Let's see if this can result in concrete deliverables that can provide new solutions to old challenges."
FP: Can you talk about some concrete outcomes? Do you think the trip succeeded?
JC: A lot of deliverables that came out of that trip: We created a program called the U.S.-Iraq internship program, for example. We figured that instead of just bringing Iraqi students on exchanges to the United States to study at high schools and universities, let's create internships for them at technology and other start-ups to immerse them in the entrepreneurial "garage culture." So now we're bringing young Iraqi engineers to the U.S. to work for Twitter, Howcast, AT&T, etc. After they go back to Iraq, based on the connections they built in the U.S. and based on what they've learned in the U.S., they're now building their own networks -- what they believe will be their version of Silicon Valley for Iraq. They're the pioneers of entrepreneurship in a post-Saddam Iraq.
Also, the Museum Project was really cool. Iraq has this amazing national museum, and it's an incredible source of pride. Sixty to 70 percent of the museum artifacts that were stolen in recent years have been returned, but the museum exists in a part of Iraq that is sufficiently turbulent that it is not open to the public. We figured that if people can't go there, let's create a virtual presence for it. So we partnered with about 10 different companies. Google, for instance, sent engineers out and digitized the entire museum with street-view technology, literally rolling trolleys around the museum, taking images of things, and built this whole virtual platform. We had a company called Blue State Digital, which did the Obama campaign's tech stuff, build it out, and Howcast, an online video company, created accompanying "how-to" videos -- like how to tell if your Iraqi antiquity is stolen and what to do about it.
These things aren't going to change the face of Iraq, but what I was trying to do was show how these technology delegations can lead to deliverables that are funded and driven in part by the private sector. While small in this early piloted stage, maybe this can actually be a methodology that can be scaled up at a later date.
FP: Talk about the evolution of thinking behind State Department initiatives now identified as "21st-century statecraft."
JC: The core of it, to me, is bringing together nontraditional partners to do multistakeholder initiatives. The State Department's Policy Planning staff, which is where I've worked for four years, is typically thought of as the secretary of state's personal think tank. Our job is to generate ideas, think out of the box, think long term, and we have the most valuable resource of all, which is the resource of time. We are the only entity, really, in the State Department, maybe the U.S. government, that has the mandate to sit around and think big thoughts and think ahead and put pieces together.
In the four years that I've been in policy planning, I've worked for three excellent directors: Steve Krasner, David Gordon, and Anne-Marie Slaughter, who have all transformed it more into a think/do-tank. I look at the Policy Planning staff now as the secretary of state's personal think tank, but also the secretary of state's personal start-up. I often say Policy Planning is very analogous to a venture capital firm. A venture capital firm sees an interesting idea and puts money behind it; in Policy Planning, we look for promising ideas and then put contacts and relationships behind it.
The U.S. government is uniquely positioned to be the world's greatest matchmaker, and I don't mean that as a jargony statement. With all of our embassies and consulates around the world, the fact that people will take our phone calls and the fact that we have a really good bird's-eye view into how different stakeholders can help address different challenges [means] we can play matchmaker well. That's why when you hear people within State now saying something like "statecraft is as much about building connections as it is doing negotiations," it's actually something that has meaning.
Of course, we still do negotiations; we still do representation; we still do government-to-government exchanges. But it's about using new tools and working with new kinds of stakeholders. The technology delegations are a great example.
FP: So it's more about bringing together different problem-solvers than about technology per se?
JC: So here's what frustrates me. There are two common misperceptions about the technology aspect of 21st-century statecraft. The first is that the technology side of 21st-century statecraft is just about State Department officials using Twitter and blogging more -- in other words, that embracing technology is just about more effectively and innovatively communicating and advocating our policy. I think technology is a valuable tool for that, but to me that's public diplomacy 2.0.
When I think about 21st century statecraft, I think about technology being used as a tool to empower citizens, to promote greater accountability and transparency, to do capacity building. At its core, what technology does is it connects people to information, which is new media; it connects people to each other, which is social media; and then there's a far more exciting path that we're going down now, which is that technology is a tool to connect people to actual resources -- like mobile banking or mobile money transfers or telemedicine.
My second frustration is that I embrace technology, but not without an understanding of what the challenges are. My own thinking has evolved over the years. I think when I wrote Children of Jihad, I wrote it with a very optimistic view of what technology can do; today I maintain that optimistic view, but I'm also aware of the challenges we have. So I would say I'm not a techno-utopian, but I'm a techno-pragmatist. I get the downsides of technology; in fact, I'm very concerned about the downsides of technology.
FP: Do you worry that efforts encouraging, or enabling, people to use social media in a place like Iran may be inviting them -- especially dissenters and human rights activists -- to put themselves at greater risk, with more personal information online? In a worst-case scenario, do you worry about enabling the surveillance operations of a police state?
JC: Technology is a tool, and it's a platform. Nobody gets arrested for being a blogger; people get arrested for dissent. Nobody gets arrested for putting information about themselves online; they get arrested for being an activist. I'm a strong believer in the fact that you should not blame the tools; you should blame the circumstances.
FP: Going forward, tell us about your future work at Google.
JC: I am going to be director of a new division at Google called Google Ideas. And it's basically a think/do tank. Much of the model for it is built off of my experiences on the Policy Planning staff. It's not designed to be, "Let's pool all of Google's resources and tackle global challenges."
In the same way Policy Planning works by bringing together a lot of stakeholders in government, out of government, and across different sectors, so, too, will Google Ideas do something very similar. And the range of challenges that it may focus on include everything from the sort of hard challenges like counterterrorism, counterradicalization, and nonproliferation, to some of the ones people might expect it to focus on, like development and citizen empowerment.
What I'm interested in is the SWAT-team model of building teams of stakeholders with different resources and perspectives to troubleshoot challenges. So the reason I say it's a think/do tank is you need a comprehensive approach to think about and tackle challenges in different kinds of ways. In government, we used to refer to a "whole of government" approach, meaning work with multiple agencies to leverage ideas and resources; Google Ideas will take a "whole of society" approach.
FP: What can you do at Google that wasn't possible at the State Department?
JC: There are things the private sector can do that the U.S. government can't do. The big thing is the resources and the capabilities. There are not a couple hundred [computer] engineers in the State Department that can build things; that's just not what government does. You don't necessarily have some of the financial resources to put behind these things. It's really hard to bring talented young people in; there are not a lot mechanisms to do it. On some topics, it's very sensitive for government to be the one doing this.-- Foreign Policy
August 9th, 2010 - 10:09am
Filed under Economy
The time has come to bite the bullet. Throughout the world there is growing support for massive change in the ways that financial systems operate as most countries view the current systems as the cause for the worldwide financial crisis.
The International Monetary Fund has often been discriminatory in the implementation of their obligations, mostly due to the pressure exerted by the G20 nations who dominate the membership of their board of governors. Most central banks have all operated to impose regulations, currency manipulations, trade barriers, and political influence to the advantage of their own needs without regard to how it impacts the globalized economy.
We are not talking about minor adjustments here, but rather a wholesale restructuring of the world's financial communities. We can no longer allow financial entities to develop new products that stay one step ahead of the government regulators and permit the obscene practice of the "greater fool" philosophy which has characterized the banks activities over the past several years and has been the root cause of the world wide recession.
In the United States you cannot even count the number of regulatory agencies responsible for overseeing the activities of the banks and financial entities. It is no wonder that the left hand never knows what the right hand is doing! Rose Marie Kushmeider writing for the FDIC Banking Review stated that the research department of the World Bank reported that at the end of 2002 at least 46 countries had already revamped their supervisory responsibilities for their financial institutions by adopting a single agency or set the machinery in motion to do so. Beginning with Norway in 1986, 22 countries have already consolidated into a single supervisory agency.
In the United States the Federal Reserve directly supervises only 12% of the banks and then only 25% of their assets. This small percentage does not effectively prohibit the banks from taking undue risks with the rest of their assets. Barney Frank and Christopher Dodd have demonstrated they are not capable of supervising Fannie Mae and Freddie Mac, so even quasi-private entities need better supervision. The Securities and Exchange Commission has done a woeful job of supervising Wall Street investment bankers.
Of course there will be tremendous opposition to restructuring the financial system of the United States. The banking lobby virtually regulates itself. The politicians move seamlessly between Wall Street and Washington, and any new restructuring will require Congressional Action.
Paul K. Kelly, the president of Knox & Co. maintains that this should start with reinstating a law with the spirit of the Glass-Steagall Act. The repeal of this act in 1999 allowed the commercial banks to become investment banks, and investment banks to become protected as though they were commercial banks. All the financial institutions set about to get involved in the marketing of insurance products, derivatives, credit default swaps, and many other sophisticated products that no one had any idea of the risk ramifications they presented.
Once each entity has determined in which part of the financial marketplace it wishes to be placed, it should clean up the books. Write off, or sell all the toxic assets so that their books reflect properly their capital position.
Then new capital requirements should be established that meet prudent investment risks. Non-banking corporations such as General Electric, Sears, and insurance companies should be forced to liquidate their banking activities.
We need to do this sooner than later. The benefits to the United States and its citizenry are numerous and our leadership will once again prove to the world that we have our financial house in order. Confidence in the dollar will return internationally. Confidence in the new system will spur activities in the business community and result in businesses once again gearing up for planned growth and the hiring of employees to meet that growth that will do more than any other activity to improve our unemployment situation. We need to establish products that each segment of the financial system can offer to their customers. One stop shopping in the financial institutions simply is impossible to manage, supervise, or regulate. It is extremely difficult to determine who is responsibility for fraud and deceptive practices, and then to prosecute them. This leaves depositors, investors, shareholders, and taxpayers holding the bag for the losses.
The only losers are the ones that caused the problem in the first place with their exotic risk taking, like Dick Fuhr of Lehman Brothers, who lost hundreds of millions of dollars yet he is extraordinarily wealthy personally, rewarded for those unwise risks he authorized even while he drove Lehman Brothers into bankruptcy.
Dominique Strauss-Kahn the Managing Director of the International Monetary Fund recently said: "if there is not a restructuring of the banking system, then all the money that you can put into monetary and fiscal stimulus will just go into a black hole." He states that the IMF has been through 122 banking crises and one thing is constant: until all of the losses have been recognized, not only from real estate, but also from other factors resulting from the downturn in the economy and only then can we expect much improvement in our globalized economy. Not until the banks have been cleaned up can we find any way for recovery.
Banks are important to Capitalism. Credit is important to Capitalism. But, the stacked deck we use today does not allow Capitalism to work properly. We need to be the world leader in being the first to allow the free market to work and lead the global economy out of the recession
July 30th, 2010 - 9:28am
"The budget should be balanced; the treasury should be refilled; public debt should be reduced; and the arrogance of public officials should be controlled." -Cicero. 106-43 B.C.
Hardly a day goes by when we are not bombarded with information, both valid and misleading, about the sheer size of the national debt of the United States. The average American has a tendency to dismiss the reports as too big for him/her to worry about. In truth, they should be very worried as the national debt influences our personal financial lives in many ways: rising interest rates, higher taxes and inflation among them. As federal debt increases investors lose faith in the ability of the government to pay, and the borrowing for the productive private sector dries up. Yet in 2010 the federal government is projected to issue almost as much new debt as the rest of the world combined! The real indebtedness is close to $53 trillion dollars when future Social Security and Medicare liabilities are included according to David Walker, former Comptroller General.
In addition, some economists argue that the government is manipulating the inflation rate by understating the Consumer Price Index which ignores food and energy costs. If they took these factors into consideration, the CPI, our inflation rate would be considerable higher, but that would cause increases in pensions, benefits, and federal deficits. This would require higher interest rates and the government bailouts would overwhelm the federal and state budgets and the financial sector would face an even greater crisis.
The Office of Management and Budget lays the blame for our massive debt in three areas: an imbalance between federal revenues and spending that predates the recession and the recent turmoil in financial markets, sharply lower revenues and elevated government spending, and the various federal policies implemented in response to the conditions. They forecast the debt in 2019 to be 76.5% of GDP, but other sources place it there right now in 2010.
Further increases in federal debt relative to GDP almost certainly lie ahead if current policies remain in place.
Murray Rothbard, a libertarian economist, warns that a long-term reliance on borrowing by government to pay for public goods and services is a recipe for disaster. He says that this incurring this massive debt places a growing and intolerable burden on the society and economy, both because they raise the tax burden and drain resources from the productive to the non-productive.
Another economist, Milton Feldstein says that common sense tells us that the ratio of debt to GDP should not be allowed to rise year after year. A country should recognize that it is in trouble if it sees the ratio of debt to GDP rising year after year. Deficits are popular with politicians because deficits are not visible to voters as the burden is shifted to future generations.
This entire spending mind-set started with John Maynard Keynes in the early 1940s, and was supported by ever-growing numbers of university educated economists. However, these policies have left one important question: How soon and how deep will the crash be in this credit-fueled and speculative-dominated economic cycle?
The heads of President Obama's national debt commission, Alan Simpson and Erskine Bowles, told a meeting of the nation's governors that they cannot count on the federal government to bail them out any further. "This debt is like a cancer," Bowles said. "It is truly going to destroy the country from within." According to EconomicPolicyJournal.com, 32 states have already run out of funds to pay for any unemployment benefits.
In testimony before President Obama's new bipartisan commission, Ben Bernanke stated that the government deficits threaten the American economy. This commission is smacking of hypocrisy. The President tells everyone that he is working to control the problem and fix the economy, yet his actions are just the opposite of the appropriate requirements. He calls for a "spending freeze" at a historically high level both in real terms and as a percentage of GDP.
Of special danger to the American economy is the amount of debt held by foreign countries. Recently, Russia and China had a meeting to discuss how they could team up to weaken the dollar. Although nothing official came from that meeting, the danger persists. Over the last ten years foreign ownership of our debt as increased from 29% to 48% of the outstanding total.
The rest of the world recognizes that the Congressional Budget Office has, for some time, been cooking the books to make President Obama's economic decisions look good, and they consider our fiscal policies very dangerous.
IN FACT, IF YOU SPENT ONE MILLION DOLLARS EVERY DAY SINCE THE BIRTH OF CHRIST, YOU STILL WOULD NOT HAVE SPENT ONE TRILLION DOLLARS BY NOW!
June 21st, 2010 - 11:03am
Filed under International Security
By: GN Member Sam Chapin
"THE ONLY EASY DAY WAS YESTERDAY" reads a sign in the "Grinder" -- the courtyard where each morning, U.S. Navy SEAL trainees perform calisthenics before being physically and mentally challenged beyond belief. For the twenty-five civilians and Gen Next Members, of which I am one, that sign was at once ominous and prophetic. Thanks to GN Member Jared Cohen, we were recently able to spend the day at the SEAL training compound at Coronado, just across the bridge from San Diego. It is rare for civilian groups to take a tour of the SEAL compound and our tour was the first to allow a group to attempt the famous obstacle course.
The experience was a profound dose of perspective. It left us grateful that there are still some aspects of American life where merit is the standard , mediocrity is not accepted, and trophies are not awarded simply for showing up.
For those either unaware or smart enough not to watch the movie G.I. Jane, "SEAL" is the acronym for the elite group of warriors expertly trained in Sea, Air, and Land and these guys are truly impressive. Our host SEAL, Trevor (28), was no exception. Trevor, a Washington State native from Kent, is a Naval Academy grad, Rhodes Scholar Alum from Oxford University, Navy Lieutenant, and Assistant Officer in Charge of a SEAL platoon. Just your basic stellar human being who is physically capable of unimaginable feats and willing to sacrifice his life for our freedom and our country. In other words, and to borrow an infamous line, we want him on that wall -- we need him on that wall.
Our tour began with a presentation and Q&A session where we learned that each year up to 1000 young men attempt the six-month SEAL BUD/S course (Basic Underwater Demolition/SEALs). And each year no more than 250 receive their Trident which signifies their induction onto an elite SEAL team. We learned that SEALs are deployed in forty countries and are away from home about 50% of the time. Their training is unimaginably rigorous, dangerous, and complex.
They are often called the "Silent Warriors" because of their unique ability to perform their missions with stealth. During their training, however, the silence is often broken by the call of the motivational exclamation "Hooyah!" Hooyah is the SEAL word for pretty much anything and everything and somehow manages to keep up morale.
It became quickly obvious to us that the men who become SEALs are a breed apart. Marcus Luttrell, ex-SEAL and author of the book Lone Survivor, described the men who make it through the grueling training as "the ones with no quit in them." For the ones who do ultimately quit, the quitting process, as we witnessed, is solemn. Out on the Grinder courtyard there was a line of about 50 helmets which started underneath a large bell on a post. Those helmets had been placed there by some in the present class of trainees who decided that being a SEAL was not for them. Each trainee rung the bell three times, placed his helmet on the ground, and walked out. Some made the choice to quit and others were forced out after failing any of the "Evolutions" (the SEAL word for training challenge whether running, swimming, shooting, testing, or demolition).
The training evolutions occur on land with long beach runs in long pants and boots, at sea with 5 mile ocean swims and inflatable boat evolutions, in the pool with dive gear and underwater demolition drills, on the firing range, and in the classroom. The classroom, incidentally, is not like your normal classroom in that it has buckets of water suspended from the ceiling to douse sleeping trainees during Hell Week (the culmination of BUD/S training) when they're allowed only four hours of sleep for the entire week. Not per night. Four hours for the entire week. And if motivation wanes, there's also this inspirational reminder on the classroom wall: "The beatings will continue until morale improves." Hooyah.
Next, we saw the headquarters for SEAL Team 3 and were honored to examine the memorial walls to the fallen SEALs of team 3 like Michael Monsoor and Marcus Lee who both died in 2006 in Iraq. Lee was awarded the Silver Star and Monsoor was awarded both the Silver Star and posthumously awarded the Medal of Honor for diving on a grenade to save his three SEAL teammates. Monsoor was nearest the door in the room when the grenade hit him in the chest and landed in front of him. He could have jumped out of the room and out of the blast. Had he done that, his teammates would surely have died. Without hesitation he jumped on the grenade, absorbed the entire explosion, and paid the ultimate price. "Hero" doesn't begin to describe a man with that kind of courage.
Our tour continued with the aid of Lucas (21) and Mike (25) who volunteered to help Trevor lead the tour on their day off. Like Trevor, Lucas and Mike are trained experts and carry themselves with the confidence, courage, and humility that is so evident in the Navy SEAL. They taught us about the various rifles, rocket launchers, pistols, and breaching tools that SEALs routinely use in battle. Fortunately for all involved, the firing range was closed and we were unable to discharge anything.
Even in the most serious of occupations and environments, however, there can be humor. For our SEAL hosts, the funny part was about to begin. After outfitting us in camouflage pants and t-shirts, they allowed us onto the obstacle course, or the "O Course" if you're speaking SEAL. Reminiscent of the movie Stripes, we were twenty-five people, ages 25-50, men and a few women all willing to try the obstacles to the extent we could. We were all pretty fit but the O Course is like nothing you have ever seen. There are 15 big obstacles (interspersed by little ones) and they are daunting to say the least. There are ropes, logs, walls, and barbed wire everywhere. One of their doctors gave us a pre-briefing, explaining where they would take us if we were in serious trouble or if "something minor" occurred like a broken leg. Yikes.
SEALs must complete the entire O Course quickly and without failing a single obstacle. They get three chances and if they fail any one obstacle, they're out. Nothing short of excellence is tolerated. Not being SEALs, we were free to fail and humiliate ourselves over and over. And that we did. There were some moments of glory here and there; and ultimately we were able to do enough of the course to make us incredibly sore, a little proud, and truly grateful for the opportunity.
We left the compound for our last Evolution - dinner and drinks with our hosts at a Coronado pub. I'm not sure which was more humbling, training like a SEAL or drinking like one. Either way, for us the hard part was over. The real test was coming for the SEAL trainees who were about to begin Hell Week two days later. Many more will quit and the line of helmets under the bell will grow. The most dedicated -- the ones with no quit in them--will succeed. For those new SEALs, yesterday was truly the only easy day. For us it was a challenging, inspiring, honor.
Sam Chapin is an attorney, University of Washington School of Law adjunct law professor, and member of Gen Next
June 8th, 2010 - 10:42am
Filed under Education
Gen Next Senior Director Wade Lairsen, is short on Team USA's chances at the FIFA World Cup this summer, but long on our children's future. Read below to see why he feels our attitudes toward each are connected.
In a few days, 32 nations will step on to the world stage and engage in the fiercest battle in four years. National pride, billions in revenue and many fans would say, global domination is at stake.
Despite the fact that Team USA has the best equipment and resources at its fingertips, we will not win the World Cup in South Africa this summer. The team will certainly mount a formidable effort, but will not go all the way. Teams from the Netherlands, Argentina, and Brazil have a far better chance at winning than Team USA. Why is that?
Undoubtedly, our athletes are as capable of being trained to win as their global counterparts. What then, holds our team back? Is it the system in which they play? Is it the comparative lack of national focus on soccer?
One thing is certain. Instead of insisting that Team USA brings home a win, we have lowered our expectations. Our team's best hope comes in the first round, where a victory over England would be an upset the likes of which hasn't been seen since 1950. Winners win championship titles; they don't get excited by merely winning round one.
One might argue that expectation to win the World Cup in a game like soccer is unrealistic. But acceptance of our own mediocrity is a reality with far greater implications.
A similar battle is taking place where stakes are much higher. This battle is fought not on the soccer fields, but rather in elementary, middle and high school classrooms around the world.
Here, too, the United States has lowered its expectations and accepted its own mediocrity. Currently, students in the United States rank 25th in Math and 21st in Science among 30 developed countries. They continue to fall behind their counterparts in countries, such as Finland, Canada, and the Czech Republic. Meanwhile, the Czech Republic spends only one-third as much per student as the United States does.
In recent years, we have been somewhat successful at narrowing the achievement gap between minority and non-minority students, domestically; yet we have not begun to address our own global achievement gap.
Team USA has undoubtedly been working since the 1950s--albeit without success--to repeat that historic victory and Americans have been talking for a longer period of time about fixing the problems in education. In 1955, Rudolf Flesch authored the groundbreaking bestseller "Why Johnny Can't Read," which cited system-wide failures resulting in the fact that students in the United States were dramatically less literate than their counterparts in Germany and the United Kingdom. Despite the book's popularity and that it has been long-hailed as a breakthrough in identifying challenges in the American education system, the problem persisted. In 1981, Flesch followed up with "Why Johnny Still Can't Read," where he noted that the education system's response to the issues he raised more than 25 years prior had been more about protecting its own image and monopoly, than actually addressing the core issue.
Today, for the first time in history, this generation of Americans will be less literate than the generation before it. That means Johnny could not read and Johnny, Jr. will be even less literate.
When today's elementary school students graduate high school, will they be prepared to step on to that field of competition and mount a formidable economic defense (or, preferably, offense) against the brute force of China with its seemingly endless amount of cash available for investment, or the agility of India which is able to replicate the latest US business models almost overnight?
Much like Team USA competing in South Africa this summer, the United States certainly has the best equipment and resources available, which could be used to educate our children. We must ask ourselves then, are our students inherently less capable of learning than students in Finland?
Certainly, that's not the case. Our students continue to fail because we lack national focus on their individual education and have accepted our own mediocrity and the broken system in which they struggle every day. It seems we have forgotten that our education system exists for one reason: to educate our children.
Sadly, it also seems that those running the system treat it more as a job bank focused on pensions and retirement plans, than the cultivation of opportunities for our kids and our country's future economic capabilities. While it would be hyperbole to say that global domination is at stake in South Africa this summer, global position is most certainly what's at stake in classrooms across the United States every day.
The US is still the world's largest economy, and also competes quite well on the world stage of the Olympics. If soccer teaches us anything, however, it should teach us that acceptance of our own mediocrity is a self-fulfilling prophecy.
The stakes are too high, the future of a nation demands it, and the United States must accept nothing less than a win.
U-S-A, U-S-A, U-S-A!
June 7th, 2010 - 4:27pm
Filed under Economy
Governor Chris Christie gives remarks regarding Teachers and the New Jersey Education Association during a Town Hall Meeting in Robbinsville, N.J.
May 17th, 2010 - 10:26am
Filed under International Security
Orange County's hottest race in the June 8 primary election quite possibly is the competition for Sheriff-Coroner. Given the previous elected sheriff was the disgraced Mike Carona, emotions are high as voters consider which candidate will do the most to restore integrity to the county's top law enforcement post.
The candidates: the appointed sheriff, Sandra Hutchens, Anaheim Deputy Police Chief Craig Hunter, and former sheriff's Lt. Bill Hunt.
Voters have a choice between what seems to be the seemingly sensible political establishment pick, the mostly unknown local deputy chief or the populist union candidate de jour.
All three differ on issues such as crime fighting, the role of SWAT teams and administration of the county jails. But voters should take this opportunity to repudiate public employee union influence on county elections and maintaining bloated pension benefits, reaffirm local commitment to the Constitution's Second Amendment and, most importantly, restore integrity to the office of sheriff.
Orange County's political landscape was rattled in October 2007 when Sheriff Carona was indicted on federal corruption charges. He resigned in January 2008 and was temporarily replaced by an assistant sheriff, Jack Anderson. That June, Hutchens was appointed sheriff by the county Board of Supervisors, to serve the remainder of Carona's term.
This election will mark the first time voters will elect a new sheriff since Carona first won the job in 1998. Let's hope this time around they choose more wisely.
The department has been virtually scandal-free since Hutchens' appointment and she has been effective in general, demonstrating a firm grasp on budgetary issues. Her biggest drawback was her political blunder regarding concealed-weapons permits, and how she responded to criticism from the Board of Supervisors.
Hutchens came under hard fire (not literally) within the first few months of her appointment related to some "reforms." The OCSD sent letters to many people who hold permits to carry concealed weapons (CCWs), informing them that the "Department has determined that your identified risk does not meet the good-cause threshold as required under the new CCW policy based upon the information you provided. As a result of this determination, the Department's present intention is to revoke your CCW license." This sparked a backlash from many of the permit-holders, other residents and gun-rights activists.
Last Tuesday, The Orange County Register, the Orange County Forum and Gen-Next gave the three candidates an opportunity to square off in a 75-minute debate showcasing the differences in their approaches to law enforcement. I moderated the debate, which helped me conclude who is the most promising candidate and, perhaps more importantly, who is the most objectionable candidate, from a freedom perspective.
Hunt, who ran against Carona in 2006 and then retired as a lieutenant when Carona moved to demote him after the election, has an uncomfortably aggressive style of communication, which made some members of the debate audience, the moderator included, a little uncomfortable. It seemed like he was hopped up on one too many Red Bulls.
Hunt's message, as Hutchens noted, was long on platitudes and short on substance. But his impassioned populist appeals seem to be resonating with at least the Tea Party crowd and perhaps a broader segment of county voters. He portrays himself as a Sheriff Joe Arpaio-type of law enforcer but his priorities are misguided. And he rose in the Sheriff's Department under Mike Carona.
My biggest concern with Hunt is that he is the union candidate. He was endorsed by the ultra-powerful Association of Orange County Deputy Sheriffs, the deputy's union. When criticized at the debate for having union backing, Hunt gave a fist pump to the audience, acknowledging, apparently, that he was quite proud of that fact.
What likely comes with union support is hundreds of thousands of dollars in campaign spending and the understanding that he will defend union priorities, such as protecting unsustainable pension benefits for county deputies, which Hunt says the sheriff has no control over.
He places responsibility for pensions on the Board of Supervisors, and he is partially correct. The Board has ultimate authority to end pension abuses in the county. But the sheriff sits on a number of boards and commissions and can use the position as a bully pulpit for pension reforms.
While Hunt has the union, Hutchens has become the choice of the political establishment, or at least, that is how her candidacy appears. She has amassed an impressive list of local elected-official endorsements: Supervisor Bill Campbell - the only supervisor to make an endorsement - Rep. John Campbell, R-Irvine, South County state Sen. Mimi Walters and the OC Taxpayers Association. She has taken little union money (she says from only the firefighters union, which is promising), but she sought the deputy union's endorsement, as did Craig Hunter.
Hutchens' biggest drawback is her perceived softness on the Second Amendment, evidenced by her policy decision to revoke many CCWs. She aggravated the situation by arranging for a large show of force by deputies at a Board of Supervisors meeting where gun permits were discussed.
Hutchens has shown she is generally adept, and the department is much better off under her leadership, certainly than under Carona. And on the pension issue she is pretty good though not ideal, arguing their needs to be a two tiered system - meaning new employees should not be hired in with the same overly generous pensions deputies have now under current provisions.
The other guy
The other guy
Hunter, the deputy chief in Anaheim, is less well-known in county politics than his opponents, though his experience in law enforcement is impressive. His career spans more than 30 years, starting on the streets of Garden Grove. He has worked in jail operations, undercover, narcotics and SWAT. He has a far less aggressive style than Hunt, coming off as tempered and grounded in data and offering reasonable approaches to problems facing the Sheriff's Department. He has a strong stance on the Second Amendment and has a broader interpretation of gun permit laws than Hutchens.
Hunter says he would approve more CCW permits than has Hutchens. He is the only candidate who signed the Orange County Republican Party pledge not to accept public-employee union money for his campaign, and he has kept to that promise. Hunter has the best position on pension reform, stating that a two-tiered system - where new hires receive less-generous benefits - is not enough; the department needs to move to a 401(k)-style plan.
Hunter doesn't have political endorsements to match those of Hutchens and Hunt, though he has some, and he does have the support of nearly a dozen former police chiefs.
One shortcoming is that Hunter does not have the same familiarity with the Sheriff Department's budget as Hutchens and Hunt. But that learning curve is not insurmountable, especially for someone who has helped to run one of Orange County's largest police departments. The Anaheim department's purview includes Angel Stadium, the Honda Center, the Anaehim Convention Center and Disneyland.
My colleagues and I on the Register's Editorial Board spent considerable time debating qualifications for a sheriff. Honesty and integrity are top of the list, followed by:
- A philosophy that incorporates community policing and keeping citizens involved;
- A workable approach to dealing with illegal immigrants;
- Strong philosophical grounding in support of the Second Amendment and an open policy towards concealed weapon permits;
- A desire to reform the unsustainable pension program for public safety employees;
- A fiscally conservative approach to budgetary issues;
- A clear strategy for management of the county jails.
Applying these criteria to the candidates, it became clear to me who would make a better sheriff. Craig Hunter has a clean track record in law enforcement, adheres to the Second Amendment and has the best approach to pension reform.
Sandra Hutchens has done a good job turning the Sheriff's Department around since the days of Mike Carona. But it is difficult to overlook her narrow approach to Second Amendment issues, even though it is understandable as to why she would want to revoke gun permits arguably handed out as political favors by her predecessor. That issue aside, Hutchens would get my support.
The next elected sheriff will have a lot to deal with, but if the most important issues in this election are pensions, unions and the Second Amendment, the choice is clear. - Register
May 11th, 2010 - 1:41pm
Filed under International Security
KABUL-The Taliban warned they would launch a major countrywide offensive in Afghanistan in the coming days, momentarily shifting the focus from President Hamid Karzai's visit to Washington.
Afghan officials dismissed the Taliban's warning as nothing more than blustery rhetoric, and coalition officers said they, too, didn't think the militants could sow chaos on the scale suggested in a statement posted on their website Saturday.
But "we'll obviously be looking to see what happens Monday," the day the Taliban warned the offensive would begin, said a North Atlantic Treaty Organization officer. "Our guard is pretty high every day. This doesn't change anything."
Just days before meeting with President Obama, Afghan President Karzai paid a visit to the Bagram Airbase medical facility where he spent some time with wounded Afghan soldiers. Video courtesy of Reuters.
The Taliban said their forces would begin laying siege Monday to Afghanistan's major cities and blockading Afghan and NATO bases. The militants called their coming offensive "al-Fatah" ('to conquer' in Arabic) and warned there would be "ambushes, detonations of explosive devices, assassinations of government officials, suicide bombings and detainment of foreign invaders."
The warning appeared timed to a series of coming events. The first, Mr. Karzai's visit to Washington, starts Monday and is aimed at smoothing over the rough relations between Kabul and the Obama administration. A series of major attacks could distract from the trip and underscore just how far Mr. Karzai's government and its Western backers have to go before the Taliban is neutralized.
Later in May, Mr. Karzai is planning to convene a so-called Peace Jirga - a gathering of politicians, elders and other prominent Afghans - to chart out a path for talks with the insurgents. Alongside peace talks, the Karzai government and its Western backers are also planning to lure away low-level fighters with cash and jobs.
The Taliban, in a statement Saturday, offered their own version of that plan, saying it would provide "material incentives" to any Afghan soldiers or police who defected.
The Taliban also said they would take care to ensure the safety of ordinary Afghans. Civilian casualties, especially those caused by NATO forces, are a longstanding concern among Afghans, including Mr. Karzai, who is expected to raise the matter in Washington.
Many Afghans fear there will be more civilian casualties in the coming months as thousands of NATO and Afghan soldiers pour into the southern city of Kandahar and push out to the districts that surround it. The area is the Taliban's birthplace and strategic heartland, and coalition special operations forces are already quietly hunting down midlevel commanders in the area.
The Taliban are also stepping up activity in and around the city, and the offensive announced Saturday seemed to be a bid by the insurgents to counter allied efforts to win over the Kandahar's populace with promises of increased safety and better governance in the coming months.
The Taliban have already stepped up its suicide bombings in Kandahar, and the militants are targeting prominent officials and tribal elders in the city and surrounding districts. The latest assassination came Saturday, when the insurgents took credit for gunning down an official and two of his bodyguards in Arghandab, a volatile district north of the city.
Despite the increasing volatility in Kandahar, Afghanistan's Defense Ministry was quick to downplay Saturday's statement, calling it a "desperate move."
"This statement is just more propaganda by the Taliban," said Defense Ministry spokesman Gen. Zahir Azimi. "The enemy is in a defensive position, not in an offensive position."- WSJ
May 4th, 2010 - 11:58am
Filed under International Security
April 28th, 2010 - 8:58am
Filed under Economy
The economy is struggling through one of the worst periods in modern history. Several experts have put forth their suggestions of what we must do to end the suffering and emerge at the beginning of a recovery. Most of the proposals involve continued spending, raising taxes, or a combination of the two. Missing from the dialogue is to look at the methods that made America's economy the envy of the world. That was the implementation of Capitalism and its primary tool: free trade.
United States Trade Representative Ron Kirk recently warned the Congress that it is time to pass free trade legislation. Although President Obama has identified job creation as priority one in his recent speeches, it doesn't appear the Congress is getting the message as little is being done to facilitate free trade and to create jobs in the United States. Even the stimulus money, although paid to American firms, ends up creating jobs in China and other cheap labor markets.
Although free trade will stimulate export-driven jobs and would help to meet Obama's goal to double the United States exports over the next five years, we still see Europe claiming many of our markets overseas. The only supporters of free trade policies seem to be conservatives and business groups in Washington. Labor, through their lobbyists such as the AFL-CIO and other labor groups say they NEVER will support any program that promotes free trade. Alan Blinder writing in the Library of Economic Liberty periodical said that the divergence between economists' beliefs and those of well-educated men and women on the street seems to arise in making the leap from individuals to nations. In running our personal affairs, virtually all of us exploit the advantages of free trade...without thinking twice. The fact that another country becomes wealthier does not mean that America becomes poorer. One reason that the United States did so much better than Europe for two centuries is that Americans had free movement of goods and services across our state lines while European countries "protected" themselves from their neighbors.
Many estimates have been made regarding the "saving of jobs" through trade restrictions. Invariably, these trade restrictions end up costing Americans more. Consider the $1,285,000 we lose annually for every job in the luggage business, $199,000 lost annually for each job in the textile industry, $1,044,000 lost annually for each job in the softwood lumber industry, and $1,376,000 a year for each job in the benzenoid chemical industry! On the other side of the issue, free trade provided 1.2 trillion dollars in revenue and supported one in five manufacturing jobs here in the United States. With more than 95% of the world's consumers living outside the borders of the United States the global marketplace is important to domestic companies.
Daniel Griswold of the Cato Institute reports that a recent study by the Institute found that 90% of Senators and Congresspersons favor trade restrictions over free trade. This study shows a drifting towards isolationism. Americans pay dearly for the government intervention in free trade matters. The trade barriers erected by Congress cost Americans an estimated 70 billion dollars a year by raising prices and reducing competition. Daniella Markheim, of the Heritage Foundation, said that hiding from or ignoring the debate on globalization will not promote a free trade agenda. Rather, this approach leaves the voice of protectionism as the only voice being heard on trade issues.
The Institute for International Economics has calculated that moving from today's trade environment to one characterized by perfectly free trade would generate an additional 500 billion dollars in annual income. Also, the University of Michigan concludes that if we would reduce the trade barriers on agriculture, manufacturing, and service activities by just one third we would increase our annual income by another 500 billion dollars. So, the message is clear. Congress needs to support trade agreements, ratify the agreements already in place with a number of countries, stop protectionism legislation, and eliminate all international trade barriers. - By: GN Member John Ridings Lee
April 26th, 2010 - 1:29pm
Filed under Quilliam
Quilliam's counter-extremism work has been the subject of the latest edition of CBS '60 Minutes', one of the US's most prominent and influential current affairs TV programmes. the Qulliam Foundation is a partner of Gen Next.
The programme's lead 14 minute segment, entitled 'Jihadists and The Narrative', focuses on Quilliam director Maajid Nawaz's involvement in a hard-line Islamist group and on his subsequent decision to reject Islamism - while remaining Muslim - and to co-found Quilliam to directly challenge extremism in all its forms.
First aired on Sunday evening in America, the programme also covers Quilliam's ground-breaking work in Pakistan, its regular events in British universities and its wider efforts to puncture Islamist narratives.
Maajid Nawaz says:
'Today, as this programme shows, I believe that Muslim-led organisations need to do more to actively undermine the ideas and aims of the terrorism-sympathising groups that fester in our midst - condemning terrorist violence is not enough. And in this battle of ideas, governments cannot shy away from taking sides. Such past blunders has resulted in our present malaise.
'For how much longer we try to tackle terrorism, while not uprooting the narrative and ideology behind Islamist violence? This programme helps explain the challenges that we all face.'
The programme can be watched online here.
Quilliam's annual progress report can be downloaded here.
1. Quilliam is Britain's first counter-extremism think tank. It is an independent organization and believes in political representation as citizens through Parliament, not separatist community groupings.
April 15th, 2010 - 12:03pm
Filed under Economy
Oil drilling, conservation measure not enough to address America's energy security challenge
Two policy announcements last week revealed the Obama administration's core strategy in addressing the nation's growing dependence on oil. On Wednesday, President Barack Obama announced that his administration would allow new oil exploration along the Atlantic Coast and in the eastern Gulf of Mexico. The following day, the administration announced new mandatory fuel efficiency standards of 35.5 mpg average within six years, up nearly 10 mpg from now.
By simultaneously promoting supply-side solutions (drill baby, drill) and demand-side solutions like increased efficiency, Mr. Obama is throwing bones to the two camps that for decades have dominated the nation's energy debate. This may be smart politics, but when it comes to effectiveness - though there is nothing wrong fundamentally with either efficiency or drilling - both policies will do very little to address America's energy security challenge, as they fail to address the root of the problem: oil's virtual monopoly over transportation fuel (only 2 percent of U.S. oil demand is due to electricity generation).
Last year, the U.S. Energy Information Administration (EIA) estimated that opening the Outer Continental Shelf to exploration would affect oil prices by 11 cents per barrel by 2020, which would translate to less than a penny per gallon. On the flip side, going on an efficiency diet would not even offset the growth in demand due to natural growth.
Furthermore, consider OPEC's response. The history of the past 30 years shows that when non-OPEC producers increase their production, OPEC responds with production cuts, essentially keeping the same amount of oil in the market. Conversely, when we use less due to higher gasoline taxes, stricter fuel efficiency standards or simply in response to a hike in gasoline prices, as was the case in 2008, OPEC, again, cuts its production. In other words: when we drill more, OPEC drills less; when we use less, OPEC drills less.
While both drilling and efficiency promise little relief, with growing instability in the Middle East and millions of Chinese and Indians moving from bicycles to cars, it is almost a given that we will face further painful oil crises as the decade progresses. Contrary to popular belief, our oil dependence problem is not a function of the amount of oil we consume or import (we don't care how many bananas we consume or how many computers we import) but about the fact that oil is a strategic commodity second to none. More than 95 percent of transportation energy is petroleum based. Therefore, solutions that perpetuate the petroleum standard rather than producing new vehicles in a way that enables fuel competition are vastly insufficient.
A transformational approach is needed. Until the 19th Century, salt had a position similar to that of oil today because it was the only means of preserving food. Salt-rich countries had inordinate power on the world stage. Wars were fought over salt. Today, salt is still a useful commodity for a range of purposes. We import much of our salt, but canning, electricity and refrigeration decisively ended its monopoly over food preservation, diminishing its strategic importance.
To truly address our oil dependence problem, we must do to oil what humanity did to salt: turn it into just another commodity. The cheapest and easiest technology to strip oil of its strategic status is the flex fuel vehicle. This technology, which costs less than an extra $100 per new vehicle, enables cars to run on any blend of gasoline and alcohol fuels like ethanol or methanol. Such fuels can be made cheaply from a variety of non-petroleum energy sources ranging from coal to natural gas to biomass.
In the future, technologies to produce alcohol fuels from carbon dioxide may offer an elegant way to achieve energy independence while reducing greenhouse gas emissions. If every car sold around the world was flex fueled, gasoline would have to compete at the pump against a variety of alternative fuels, and the oil barons in the Middle East would be challenged by fuels made elsewhere, including in poor countries in Africa, Latin America and South Asia.
President Obama has expressed several times his support for flex fuel vehicles. So did Secretary of Energy Steven Chu. A bipartisan bill, the Open Fuel Standard Act, which requires that 50 percent of new cars be flex fuel by 2012, was introduced before both the House and the Senate. Now that Mr. Obama has satisfied the wishes of both drillers and dieters, its time for him to focus on the third leg of the stool and ask Congress to enable Americans what they need and deserve most - fuel choice at the pump.
Gal Luft is executive director of the Institute for the Analysis of Global Security. He is co-author of "Turning Oil into Salt: Energy Independence through Fuel Choice." His e-mail is email@example.com. - Baltimore Sun
March 23rd, 2010 - 1:13pm
Filed under Economy
Two weeks ago I interviewed Doug Akin of Mr. Youth, but after my recent interview with Roman Tsunder (1010 Youth Nominee) I believe that the title of Mr. Youth is truly his. Roman is the Founder and President of Access 360 Media, a next generation of Out-of-Home Media platform, delivering digital content and advertising programming to engaged audiences through both digital and non-traditional media. However, in addition to his work with Access 360 Media, Roman spearheads the Alliance for Youth Movements (AYM) and the PTTOW! Summit. AYM is a non-profit organization dedicated to identifying, connecting, and supporting digital activists from around the world and PTTOW! is an invite only, intimate, Allen & Co type gathering focused on the young adult market (p14-34) bringing together select CEO's, CMO's, Heads of Product and Industry Icons. Emigrating from Russia to the United States when he was 5 years old, Roman understands and believes in the power of role models and mentors in youth activism and his ongoing mission is a clear depiction of that.
In this episode of mobileYouth TV, I talk with Roman on how brands can successfully incorporate social causes into their marketing initiatives.View video.
Source - Mobileyouth.org
March 10th, 2010 - 4:04pm
Filed under International Security
I'm at the Alliance for Youth Movements (AYM) summit in London, at the Intercontinental Hotel. The two-day summit, which ends tomorrow, is an impressive gathering of youth activists from more than 18 countries, NGOs and tech giants, here to learn more about using online tools to promote their extraordinary range of social movements and promote non-violent change. You can read more about the AYM here.
At the opening reception last night, hosted at Google's headquarters, I met a smart bunch of people from organizations such as Blue State Digital (which ran Obama's online campaign), Howcast, Middle East peace activists One Voice, and the East London-based Young Foundation.
But the highlight is an A-list bunch of conference speakers at the conference today and tomorrow -- including Jack Dorsey of Twitter, Sir Martin Sorrell of WPP, Scott Heiferman of MeetUp, as well as top people from Google, YouTube and the World Bank. Other keynote speakers include Jeremy Gilley, the former actor who founded Peace One Day, and Joe Rospars, who was the new-media director for Obama for America.
There's strong representation here from Washington DC. This morning, Jared Cohen, of the US State Department, moderated a session titled Seizing the Moment: Responding to Crises and Mobilizing Around Key Events. That had speakers from Mobile Accord, Ushahidi, Mazahery Law, AccessNow and the Censorship Research Center. I'm now sitting in a session called Turning Video into Tangible Action, featuring experts such as Ramya Raghaven of YouTube, Levi Felix of Causecast, and Chris Sarette, Invisible Children.
There's much discussion of how to produce a viral video to spread the word about an urgent crisis -- a panelist who's involved in the Robin Hood Tax campaign (to promote a redistributive 0.05% tax on final transactions) is currently explaining how getting the help of director Richard Curtis helped the campaign soar.
Now a human-rights activist from Israeli NGO B'Tselem is explaining how they gave 250 cameras to Palestinians in the West Bank to document the reality of local life. Not to activists, but to ordinary families, such as a 16-year-old in Hebron whose one-minute video about her frustrations became national news and influenced official policy on law-enforcement in Hebron. It wasn't about using new media -- it was about using traditional tools to provoke established media to notice a story that had been under the radar.
It's an inspiring event, geared towards helping activists share top-level information and making connections that lead to significant change. You can sense the scale of their practical ambition from the title of some of the sessions: one is called Tech Solutions to Repressive Regimes; another is titled Effective Strategies for Mobile Content to Increase Empowerment. - Wired Magazine
March 9th, 2010 - 4:46pm
Filed under Economy
The Obama administration picked 15 states and the District of Columbia as finalists in a heated competition for extra federal education funds to shake up underperforming schools.
The states that made the cut in the $4.35 billion Race to the Top competition were Colorado, Delaware, Florida, Georgia, Illinois, Kentucky, Louisiana, Massachusetts, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina and Tennessee.
President Barack Obama visits Martin Luther King Charter School in New Orleans in October. The Race to the Top program encourages such schools.
Under the program, states stand to garner hundreds of millions of dollars each, depending on their size, at a time when many local education budgets face deep funding shortfalls.
The sheer number of finalists surprised outside observers, who had predicted the administration would impose more stringent standards. The list included a number of states whose applications were considered weak.
A total of 40 states and the District of Columbia submitted applications in January for the first round of funding, with a second round set for summer.
The administration defended the selection of the 16 finalists, saying that all states whose applications cleared a pre-set score automatically advanced to the next round.
The Education Department promises to be tougher in winnowing the list down to the winners, which will be announced next month, and are expected to include fewer than a half-dozen states.
"Most of them will go home losers," said Education Secretary Arne Duncan. "We anticipate very few winners in round one."
The size of the finalist list drew fire from some quarters. "I was hoping the administration would send a clear message that you had to be absolutely great to even be in the competition," said Andrew Smarick, a former George W. Bush administration official who has supported the program. "This is a huge disappointment."
President Barack Obama has used the lure of federal grants as a way to get states and school districts to improve local education standards, even if they receive no money in the end. The idea behind the program is to reward states that show a willingness to overhaul failing schools through measures such as tough testing standards, data collection and teacher training. The administration intends to apply this competitive approach to an increasingly large share of its education budget.
The Education Department turned to a panel of outside judges to pick the finalists according to 19 criteria, including a state's track record, openness to charter schools and use of testing systems to judge teacher performance. The finalists' scores weren't made public.
Independent evaluators have given especially high marks to three states on the list-Florida, Tennessee and Louisiana-for their accountability standards and for implementing systems to track student performance. All three have also pushed to expand the growth of charter schools, which are publicly funded but independently run.
Observers who have dug through the applications were taken aback by other picks. Few gave New York much chance after state lawmakers failed in January to lift a cap on charter schools and allow for the use of student test scores in teacher evaluations.
New York caps charter schools in the state at 200, a limit it is expected to hit this year. The failed legislation would have doubled the maximum allowable, while killing a current law that bars tying teacher evaluations to student test scores.
Not allowing student test scores to be tied to teacher evaluations "seemed like a clear no-no under the rules" of the competition, said Joe Williams, executive director of Democrats for Education Reform, a group that favors charter schools and stronger teacher evaluation systems. He said the state legislature now had a short window to enact legislation that would correct New York's shortcomings.
Joel Klein, chancellor of the New York City school system, the largest in the country, failed to win the legislative changes he sought in January, but cheered the announcement nonetheless. "We're within striking distance,'' he said. He wants the legislature to immediately move to lift the charter cap and change state laws regarding teacher evaluations, firings and seniority. "That's the way to win this,'' he said. "We know that these things are hurting us.''
California, which faces a $20 billion state budget crisis, failed to make the finalist list. The state had hoped to qualify for as much as $700 million at a time when many local school districts are slashing their budgets. California had also tried hard to qualify by doing things such as ramming a bill through the legislature over union objections that allowed teachers' pay to be linked to students' test scores.
Los Angeles Unified School District Superintendent Ramon C. Cortines said Thursday he was "disappointed to learn that California is not among the Race to the Top finalists for the first round of funding." He added that "I look forward to working with the state and federal education authorities on future rounds of funding. I also hope that the Obama administration recognizes that [the Los Angeles school district] is paving its own path to success in the midst of our challenges."
Mr. Duncan and his team say they have aimed to keep the selection process as free of politics as possible. Congress, the states and the White House weren't told who made the cut until Thursday morning. Mr. Duncan said the finalists were picked solely based on the judges' scoring of their applications, and that he had no hand in the decision.
Mr. Duncan has won bipartisan support for Race to the Top, but that could change as lawmakers and governors realize only a small minority of states may emerge as winners.
The list of winners so far could stir unease for other reasons. Only five of the 16 finalists were states that went for Republican Sen. John McCain in the last presidential election. And only one of them, Colorado, was west of the Mississippi-a fact that Mr. Duncan said was "purely a coincidence." - WSJ
March 9th, 2010 - 9:28am
Filed under Economy
By Tom Hamburger
The U.S. Chamber of Commerce is building a large-scale grass-roots political operation that has begun to rival those of the major political parties, funded by record-setting amounts of money raised from corporations and wealthy individuals.
The chamber has signed up some 6 million individuals who are not chamber members and has begun asking them to help with lobbying and, soon, with get-out-the-vote efforts in upcoming congressional campaigns.
The chamber's expansion into grass-roots organizing -- coupled with a large and growing fundraising apparatus that got a lift from Supreme Court rulings -- is part of a trend in which the traditional parties are losing ground to well-financed and increasingly assertive outside groups. The chamber is certainly better positioned than ever to be a major force on the issues and elections it focuses on each year, analysts think.
The new grass-roots program, the brainchild of chamber political director Bill Miller ( Member of Gen Next), is concentrating on 22 states. Among them are Colorado, where incumbent Democratic Sen. Michael Bennet is vulnerable; Arkansas, where Democratic Sen. Blanche Lincoln faces an uphill reelection battle; and Ohio, where the chamber sees opportunities in numerous House races and an open Senate seat.
The network, called Friends of the U.S. Chamber, has been used to generate more than a million letters and e-mails to members of Congress, 700,000 of them in opposition to the Democratic healthcare plan. That is an increase from 40,000 congressional contacts generated in 2008.
What makes the initiative possible is a swelling tide of money. The chamber spent more than $144 million on lobbying and grass-roots organizing last year, a 60% increase over 2008, and well beyond the spending of individual labor unions or the Democratic or Republican national committees.
The chamber is expected to substantially exceed that spending level in 2010.
The chamber's expanding influence is worrisome to top officials in the White House -- including Chief of Staff Rahm Emanuel, who has expressed concern about the chamber in the past, and senior advisor Valerie Jarrett, who tried to build direct contacts with company executives last fall when the chamber was fighting the administration's legislation to regulate carbon emissions.
Several companies, including Pacific Gas & Electric and Apple, left the chamber over its stance on climate policies, but since then many more firms have joined and made substantial contributions, chamber President Tom Donohue said.
Two major factors are driving the chamber's growing success in fundraising.
First, President Obama and Democratic majorities in both houses of Congress have alarmed a widening circle of business leaders with their calls for greater government involvement in healthcare, tighter federal regulation of the financial industry and legislation to help unions organize workers, among other issues.
Second, the recent Supreme Court ruling that corporations have a free-speech right to spend money to help elect or defeat candidates not only struck down a century of laws limiting such spending, but it also made many business executives feel more comfortable about using corporate money for political purposes.
Industries that are the most directly affected by Washington policies and regulations -- pharmaceuticals, for example -- have always spent lavishly on lobbying and politics. But many others have held back, deterred by concern over violating the complex laws on campaign spending and by a general sense that putting money into politics might open companies to criticism.
The Supreme Court decision appears to have allayed those concerns, according to corporate lawyers and others involved in the process.
"In the past a lot of companies and wealthy individuals stood on the sidelines," said Robert Kelner, who heads the Election and Political Law Practice Group at Covington & Burling, one of Washington's most influential corporate law firms.
"In just the last election, we had the spectacle of John McCain threatening to prosecute his own supporters if they spent their money on outside groups that ran advertising in the presidential race.
"That cloud has been lifted," he said.
Using trade associations such as the chamber as the vehicle for spending corporate money on politics has an extra appeal: These groups can take large contributions from companies and wealthy individuals in ways that will probably avoid public disclosure requirements.
The chamber has developed that into something of a specialty: Under a system pioneered by Donohue, corporations have contributed money to the chamber, which then produced issue ads targeting individual candidates without revealing the names of the businesses underwriting the ads.
At the chamber, officials contend that rising donations are less the result of the recent Supreme Court ruling than they are of a 5-4 decision in 2007 in which the court ruled it was unconstitutional to ban issue-related advertising close to an election.
As a result of that ruling, the chamber was able to spend $1 million on so-called issue ads in the final days of the Massachusetts Senate race in January to help elect Scott Brown, the state's first Republican senator in decades.
As ominous music played in the background of one of the ads, a moderator intoned: "Washington politicians continue to fail us. More spending and fewer jobs. Scott Brown . . . supports measures that hold spending and cut taxes. . . . Call Scott Brown. Thank him."
Powerful as the effect of such advertising could be, the chamber and its allies expect the next big expansion of influence will come in street-level organizing and voter turnout operations.
Miller, a former chief of staff to a GOP lawmaker and co-owner of a restaurant in Washington's tony Georgetown section, built up the chamber's grass-roots organization in 2008 and expanded it in 2009 with the help of consulting firms.
Studying magazine subscriptions, voter registration and consumer buying habits, the consultants built a list of potential allies in 122 key congressional districts.
Individuals were invited to join the Friends of the U.S. Chamber initiative and were promised updates and special insights on Washington. They were then "activated," asked to write letters or call Congress on a particular issue or get involved in events in the districts.
Miller said the so-called activation rate was "roughly equivalent" to the rate claimed by Organizing for America, the network known as Obama for America during the presidential campaign, which has twice as many members.
The chamber has also given its staff, especially senior leaders, incentives to push fundraising. They are now working, in effect, on a commission system: the more money they bring in, the more they are compensated.
Officially, the chamber is a bipartisan nonprofit organization, but over the last decade it has tilted decidedly toward the Republicans. During 2008, 86% of the spending by the chamber's political action committee went to Republicans. Far more was spent on issue ads, most supporting GOP candidates.
The chamber says it represents 3 million companies that pay dues to the national chamber or a local affiliate, though internal documents suggest the organization's treasury is filled in substantial part by contributions from a couple dozen major corporations most affected by Washington policymakers.
Tax records from 2008 show that 19 companies or individuals paid between $1 million and $15.3 million, providing a third of the chamber's total revenue that year. Because the chamber is a nonprofit, it must disclose donations, but not necessarily the identity of the donors.
The chamber insists that those donors remain anonymous.
Some labor-backed organizations, such as Working America, which has 3 million nonunion members nationwide, have also declined to release details of its donors, which suggests a rocky road for legislation to require more transparency.
Kim Geiger of the Washington bureau contributed to this report.
Copyright © 2010, The Los Angeles Times
February 23rd, 2010 - 5:14pm
Filed under International Security
Silicon Valley and the State Department are getting along quite well under the Obama Administration. Last year, a tech delegation traveled with the State Department to Iraq and Mexico City to see how technology can help aid the countries. As a result of those trips, the Iraqi government set up a YouTube channel and digitized the contents of its looted national museum, while Mexico set up an SMS hotline for reporting crimes anonymously. In January, Sec. Hillary Clinton held a dinner in Washington D.C. for tech innovators and luminaries to discuss how to harness the power of technology tools to promote diplomacy around the globe, what Secretary Clinton calls "21st Century Statecraft."
Today, a group of leaders in the tech sector is joining the State Department on a trip to Russia to discuss how communications technologies and social media can be used to strengthen and broaden the ties between the United States and Russia. The State Department has recruited some big names to join the trip, including actor and social media lover Ashton Kutcher, eBay CEO John Donahoe, Twitter co-founder and Square founder Jack Dorsey, and Cisco CTO Padmasree Warrior. We hear one of Kutcher's responsibilities will be to Tweet about the trip. Topics which will be explored include how to foster entrepreneurship and how to use the Web to combat child trafficking and corruption, and use it to improve training, distance learning for remote populations, e-government initiatives, and cultural exchanges.
The delegation is led by Jared Cohen, a State Department policy staffer, Howard Solomon of the National Security Council and White House Chief Technology Officer Aneesh Chopra. The full list of tech leaders on the trip include John Donahoe, Jack Dorsey, Padmasree Warrior, Shervin Pishevar, executive chairman and founder of Social Gaming Network; Jason Liebman, CEO and cofounder of Howcast; Esther Dyson, prolific investor and leader; Mitchell Baker, Chair of the Mozilla Foundation; and Ellis Rubinstein, president and CEO of New York Academy of Sciences.
Kutcher, along with his actress wife, Demi Moore, are the founders of the Demi and Ashton Foundation, which works on anti-trafficking issues. Kutcher also founded production company Katalyst and has been active in promoting and furthering social media initiatives.
"They are taking off their commercial hat, putting on their expert hats and becoming part-time diplomats," Cohen tells TechCrunch. "The State Department is a connector here. Statecraft is as much about building connections as doing negotiations."
The delegation is tentatively scheduled to meet with the Russian Ministers of Communications, Health and Education; with advisors to President Medvedev; with leaders of Russian technology and telecommunications companies; with cultural and educational leaders; and with civil society organizations concerned with health, child welfare anti-trafficking, and anti-corruption efforts. - Tech Crunch
February 23rd, 2010 - 5:10pm
Filed under Economy
Silicon Valley is playing a much larger role in international diplomacy in the Obama administration than in the Bush administration. That's in large part thanks to Jared Cohen, who has played a role in both.
Cohen joined Condoleezza Rice's State Department policy planning staff as its youngest member in 2006. A Stanford University graduate who won a Rhodes Scholarship and earned a master's degree in international relations at Oxford, Cohen advised the State Department on youth and education, particularly in the Muslim world. He gained notice for his book: "Children of Jihad: A Young American's Travels Among the Youth of the Middle East," which was based on his travels there. He advised Rice on how to reach young people in the Middle East who were increasingly using social media tools.
Now Cohen is on Secretary of State Hillary Clinton's team and helped with her speech on Internet freedom. I spoke with him while he was waiting at the airport to board a flight for Moscow. He's part of an effort that Secretary Clinton calls "21st Century Statecraft." In January, Clinton held a dinner in Washington to explore how to use technology to promote diplomacy.
"Statecraft as much about building connections as it is about negotiating," Cohen said.
That's what Cohen will be doing for the next five days. He has teamed with Howard Solomon of the National Security Council and White House Chief Technology Officer Aneesh Chopra to lead an all-star U.S. delegation to Russia to see how technology can mutually benefit both countries.
The State Department has always sent business delegations to other countries. But sending technology delegations is something new. Last year, a tech delegation traveled to Iraq and Mexico. After the Iraq trip, the government there set up a YouTube channel and tech companies helped set up a website to catalog arts and artifacts in the national museum that was looted after the U.S. invasion. After the Mexico trip, the country set up an SMS hotline to report crimes anonymously.
Cohen's contention: The U.S. can open doors to other countries and cultures through its technology sector that produces many of the tools that young people around the world use to connect with one another.
Among the luminaries headed to Russia with Cohen are actor Ashton Kutcher; EBay CEO John Donahoe; Shervin Pishevar, executive chairman and founder of Social Gaming Network; Twitter co-founder and Square founder Jack Dorsey; Mozilla Foundation chair Mitchell Baker; and Cisco System CTO Padmasree Warrior. They will meet with Russian ministers of health and education, advisors to President Dimitry Medvedev, leaders of technology companies and more. They will tackle issues such as encouraging entrepreneurship and e-government initiatives and combating child trafficking and corruption.
The participants were chosen because they represent a microcosm of the technology industry and they make efforts to do social good. Kutcher, and his actress wife Demi Moore, for example, have a foundation that works on trafficking issues. Kutcher is also active in social media.
"They are taking off their CEO and commercial hats and putting on their expert hats," Cohen said. - L.A. Times, Jessica Guynn
February 18th, 2010 - 11:57am
Filed under Economy
President Obama has requested another round of stimulus spending with expanded unemployment benefits and additional money for infrastructure projects to jump-start economic growth and reduce unemployment. Although this stimulus package is meeting with more opposition than the first, our elected officials do not seem to have learned anything from other countries who have unsuccessfully tried similar stimulus policies in the past. Take Japan for example.
Following strong economic growth and low interest rates in the 1980's, an asset bubble developed in the Japanese economy consisting of inflated real estate and securities prices. Recognizing that this bubble was unsustainable, the Japanese central bank raised interest rates in 1989, leading to a massive sell-off in securities and a dramatic decline in real estate values. In short, the bubble burst.
The government responded with several rounds of stimulus which consisted of massive infrastructure spending. All over Japan, roads were paved, dams were built and bridges were erected to connect numerous land masses all in an effort to stimulate the economy. In the process, Japan accumulated trillions in national debt which now totals 180% of it's nearly $6 trillion dollar economy. So large is Japan's debt that it now ranks number one of the developed countries in terms of leverage.
So how well did this entire stimulus program work? Well, economists generally refer to this period in Japan's history as the "lost decade" because the policies failed. Miserably.
Between 1989 and 2003, the Nikkei Index fell by 80% and real estate declined by 50%. Homeless camps sprung up on the banks of many rivers as people abandoned their homes due to foreclosure activity of the banks. The suicide rate skyrocketed when unemployment doubled. Even today, exports still continue their downward spiral, prompting fears of a second wave of recession for the Japanese economy.
The Heritage Foundation says that no nation is sorrier than Japan for endorsing John Maynard Keynes brand of economics and for squandering vast sums of national wealth in a vain attempt to stimulate their economy.
It now appears that these policy mistakes cost Japan the chance to lead the world in economic growth. Indeed, The Japan That Can Say "No" learned the hard way that fiscal stimulus programs financed by debt won't stop bankruptcies, declining real estate values, foreclosures, job losses or a falling stock market.
Richard Koo, the chief economist at Nomura Research Institute calls our current recession "a balance sheet recession." In the United States, the housing and credit bubble created several trillion in assets. It also created several trillion in debt. When the bubble burst, the value of the assets declined as housing prices plummeted and mortgage backed securities became worthless. Unfortunately, the debt remains.
The only solution now is for banks to remove these assets from their balance sheet by taking the write-offs. Likewise, individuals and business have no choice but to pay down their debt. This reduction in debt takes huge sums of money out of the economy. Koo maintains that Federal Reserve Chairman Ben Bernanke and popular left-of-center economist Paul Krugman, who often writes for The New York Times, do not understand this yet as demonstrated by their vain attempts to prop this bubble up even more through massive government stimulus plans financed by equally massive increases to the national debt.
When one compares one financial indicator: The Nikkei 225 Index to the Standard and Poor's 500 Index, there is a frightening similarity. If the United States stays on its current course, we are likely to suffer the same fate as Japan, and perhaps even more so, because while the savings rate cushion in Japan was 17%, the United States savings rate is considerably lower.
Furthermore, Japan had very little population growth during this period while the United States continues to grow from substantial immigration, both legal and illegal. Where most of the bad debts in Japan have been written off and removed from balance sheets, most banks in the U.S. have not written off their bad debts and we continue to prop up vast sums now owned or backed by Freddie Mac and Fannie Mae.
American businesses are truly beginning to see the same level of declines that the Japanese experience. Brian Dunn, the President of Best Buy, recently commented: "In 42 years, we have never seen such difficult times for the American consumer." If the United States does not curtail its current government spending frenzy and stabilize our sovereign debt level, we are destined to suffer a period of low economic growth, historically high unemployment, stagnating living standards, all while the world around us resumes prosperous growth.
In short, we, too, will experience our own "lost decade." - John Ridings Lee
February 11th, 2010 - 1:44pm
Filed under International Security
By Ken Stier
During the Cold War, Soviet bloc dissidents had to rely on primitive printing technologies to reproduce samizdat literature in tiny quantities. Today's dissidents living under authoritarian regimes around the world can disseminate their message world wide with the click of a mouse, through blog postings and viral videos. And, as Secretary of State Hillary Clinton announced in a recent speech, the United States plans to champion their cause by enabling unprecedented freedom of speech on the Internet, in defiance of all political censorship.
"While it is clear that the spread of [new communication] technologies is transforming our world, it is still unclear how that transformation will affect the human rights and human welfare of the world's population," noted Clinton. That's because "on their own, new technologies do not take sides in the struggle for freedom and progress, but the United States does; we stand for a single Internet where all of humanity has equal access to knowledge and ideas." (Read about internet searches in China.)
In the U.S., the notion of unfettered access to communications is so uncontroversial as to seem almost trite, but it is a revolutionary demand in countries such as Iran and China where it threatens the regimes' hold on power. That's the reason that one third of the world that has any access to internet sees a version censored by their governments. Declaring a kind of soft war on this new information curtain being drawn across the "new iconic infrastructure of our age", the U.S. is now committing itself to actively undermining censorship. In China, that means going up against some 50,000 government employees and the '50 Cent Party' - the many thousands of youths alleged to be paid 50 cents for each pro-government comment they post on-line.
The State Department is already working to enhance digital communications capabilities in some 40 countries, but not all of those efforts are aimed at subverting dictatorships. Some further development ends, such as mobile banking systems the U.S. has helped deploy in Afghanistan, and for demobilized militia members in the Congo. Others address urgent social problems. In Mexico, local mobile phone carriers are working with a U.S.-sponsored technical team to enable citizens to text information about crimes to police - the anonymity of the source would help protect informants from retribution. And in Pakistan, the U.S. helped establish the nation's first ever text-messaging system, allowing real-time information exchanges all across the country, according to Mobile Accord's James Eberhard, who has also been instrumental raising donations for Haiti through text messages. (See the top 10 banned books.)
The State Department's more sensitive efforts are those that seek to empower grassroots organizations, such as the $5 million Civil Society Initiative 2.0, officially launched in Morocco last November to work with local NGOs in North Africa and the Middle East. An even broader effort, the Alliance of Youth Movements, mentors activists from around the globe using annual summits and a bulging library of how-to videos such as How to Create a Grassroots Movement for Change. "Mostly these are one or two people doing amazing things on their own, who often did not appreciate the full significance of what they were doing, so we brought them all together," says Jason Liebman, co-founder of the AYM and Howcast, which produces the videos. "For most of them this was a first time on an airplane." (Read "A Coming Chill Over Internet Freedom?")
Having seen the potential of new communications platforms and social media to spread information and organize action, the State Department has assembled a team of tech-savvy twenty- and thirty-somethings to train activists, nurture networks and even innovate new technologies. To do this, it plans to sponsor competitions and partner with universities and companies, which Clinton called upon to "be part of our national brand" campaigning against Internet censorship.
Clinton recently hosted a dinner where her senior staff met with CEOs of leading technology companies, as part of an effort to shake up her own organization. That means ditching its 20th century habits for a culture of innovation, explains Andrew Rasiej, of the Personal Democracy Forum, who has periodically offered Clinton advice on IT issues. "Whereas the Internet may have been looked at as ancillary to her campaign when she was running for president, it is no longer, it is now integral to her vision for a successful tenure as Secretary of State," he added.
Internationally, the new emphasis on enabling the skirting of Internet censorship amounts to a shift from traditional public diplomacy to a kind of Internet democracy activism. Where the former relied on tools such as Voice of America radio broadcasts to all corners of the globe, the latter emphasizes the U.S. promoting indigenous voice in countries that curb free speech, says NYU telecommunications professor Clay Shirky, adding that enabling citizens to express themselves "is way more threatening than Voice of America-style broadcasts, and autocratic governments will react to that."
Thus far, authoritarian governments have largely managed to control the Internet in their countries, argues Hal Roberts, a researcher with Harvard's Berkman Center for Internet and Society. "Actually I think the story of the first 15 years of the widespread use of the Internet is that it is deeply embedded with local mechanisms of control and that governments can control the Internet pretty well," he says. That's only likely to change if the U.S. is willing to match the new inspirational rhetoric about Internet freedom with actions that could be deemed hostile by the regimes concerned. Time Magazine.
January 29th, 2010 - 10:38am
Filed under Economy
For decades, financial planners helped baby boomers build their nest eggs. Now, as those same folks age, advisers are increasingly preoccupied with plotting how to distribute that wealth in retirement.
That's a whole new ball game. "Managing distribution is much harder than managing accumulation," says Todd Rustman, GN Member and founder of Newport Beach Calif.-based GR Capital Management. For one thing, he says, there are more variables, primarily the addition of mortality to infamous unknowables such as market conditions.
"Longevity risk is the new buzzword," says Rustman, referring to the problem of clients outliving their money.
As more Americans head into their sunset years, Rustman believes the job skills for managing wealth need to adjust significantly. "What I've seen in 16 years in this business is that a lot of advisers take all the [retiree's] money, assume a 3% or 4% return rate, and invest it all that way."
But 2008 showed how badly that calculation can fail. To mitigate that potential, Rustman divides a retiree's money into five-year buckets, and invests each bucket as a separate nest egg based on analytics that factor in longevity, gains and average inflation. "We end up with very little risk for the next five or 10 years, and more exposure to equities over the long term," he says.
To demonstrate, he cites the example of a 63-year-old client with a wife and two grown children. "He was an executive who is now worth about $7 million," says Rustman. "He's not living high on the hog, but he also has a pension of about $6,000 a month. He's super-healthy and a non-smoker." Actuarial tables say that, on average, he'll live another 17.5 years, and his wife two years longer. Of course, no one is average. They could both live to be 100.
So first, Rustman set aside about $1.5 million of the estate plus a paid-for home, which are earmarked as an inheritance for the children. Then he took the remaining money and divided it into five five-year buckets. Bucket One would contain 27% of the remaining nest egg and assumes just a 2% rate of return because 95% of the money is in fixed-income investments like laddered CDs. "We're planning to deplete that bucket entirely," says Rustman.
The next bucket holds another 26% of the total nest egg and is marked for a 4% return, with a bit more risk exposure. It now becomes the new Bucket One after five years, converting to the safer fixed-income funds. But over the first five years when it was Bucket Two it has presumably increased in value, so distributions will be notched up to counter inflation.
The third, fourth and fifth buckets have consecutively less in total funds and larger allocations of equities; each is expected to grow at faster rates as the time horizon expands. The total equity exposure comes to about half the portfolio, but it's mostly loaded onto the back end, years away from now.
"The $1.5 million inheritance for his kids gives him a huge cushion," says Rustman. "So even if I'm wrong on a lot of things, he has a lot of cash to chew through." - WSJ
January 25th, 2010 - 2:02pm
Filed under Miscellaneous
We Have We Need is a place where relief organizations can quickly post their most urgent needs and have them matched by generous donors during a time of crisis. This site was built by a group of geeky do-gooders, also Members of Gen Next, who saw this as an opportunity to use technology to help bring people and donations together in the aftermath of a devastating earthquake in Haiti. More.
January 20th, 2010 - 11:34am
Filed under International Security
Secretary Hillary Rodham Clinton will deliver a major policy address on Internet freedom on Thursday, January 21 at 9:30 a.m. at the Newseum in Washington, D.C. Secretary Clinton's policy address will lay out the Administration's strategy for protecting freedom in the networked age of the 21st century. The speech will underscore the importance of technology as a tool to connect populations around the world to information, to each other and entities, and to actual resources be they financial, judicial, health, or educational. Four fellows representing Alliance of Youth Movements will be featured prominently in Thursday's program. The Alliance of Youth Movements (AYM) is a nonprofit organization that empowers leaders to affect nonviolent change in the world by creating and promoting the use of 21st century tools to safeguard human rights, promote good governance and foster unprecedented civic empowerment.
AYM Fellows on Thursday's panel include::
- Oscar Morales, A Million Voices Against the Farc (Colombia)
- Shubham Kanodie, In Memory of Those Who Died in the November 26th-27th Mumbai Massacre (India)
- Natalia Morari, ThinkMoldova
- Ceren Kenar, Young Civilians (Turkey)
David Nassar, Executive Director of AYM will also be participating in a panel discussion following the Secretary's remarks moderated by Anne Marie Slaughter, the Director of Policy Planning at the State Department.
AYM is the world's leading network of online and mobile social movements for change. The organization has hosted two successful which brought together some of the worlds most innovate social entrepreneurs with some of the world's most exciting technology companies. AYM supporters include Causecast.org, Facebook, Gen Next, Google, Hi5, Howcast Media, MTV, MySpace, Pepsi, Univision Interactive Media, Inc., WordPress.com and YouTube.
"Online technology has unprecedented potential to help us work together to address some of the world's most urgent problems," said Megan J. Smith, vice president of new business development and general manager of Google.org. "We are proud to support the Alliance of Youth Movements and share its vision to empower citizens and communities to influence positive change through the use of today's technology."
"Today we have the power to communicate and connect in real-time through online tools like Twitter," said Jack Dorsey, chairman and co-founder of Twitter. "Traditional social movements can now take advantage of these revolutionary technologies to spread their messages more rapidly and effectively," continued Dorsey.
January 11th, 2010 - 4:13pm
Filed under International Security
Domestic unrest and unexpected problems in Tehran's nuclear programs have made Iranian leadership susceptible to new U.S. imposed sanctions. These sanctions would suspend financial transactions with front companies for the Islamic Revolutionary Guard, the military force believed to run the nuclear weapons effort. "For now, the Iranians don't have a credible breakdown option, and we don't think they will have one for at least 18 months, maybe two or three years." Although sanctions have failed to detour Iranian nuclear efforts in the past, the Obama administration hopes that this extended time frame will allow the sanctions to have an effect and convince Iranians that their nuclear programs are not worth the price tag. - NY Times
January 11th, 2010 - 4:12pm
Filed under Economy
A war was declared on the wannabe rich when the Obama administration announced that people earning over $200,000 a year will pay higher income taxes. Professionals and small-business owners are among the hardest hit. The new law has only furthered the recession causing small business owners to retrench rather than expand by hiring new employees. Business owners fear that the proposed new income, payroll and health-care tax rates along with increased state and local taxes will put up to 70 percent of their income in the government's hands. "[If we] continue to punish and demonize [the productive class], the country will grind to a halt - as we are seeing now." - Real Clear Politics
January 11th, 2010 - 4:11pm
Filed under Economy
More Americans are fleeing California as the public sector unions diminish willingness to fulfill promises to taxpayers. As unions take control of the Democratic majorities in the state legislature, the "net internal migration" fluctuates.The union's ability to produce effective campaigns that have a track record of making or breaking political careers has caused politicians to submit to the will of the public sectors in order to receive a higher compensation. "For the first time in history most union members work for the government... [and] depend on the government for their livelihood." This change has devastated American taxpayers as the increase in union member voters results in more dollars for campaigns to elect politicians who will support higher taxes to compensate for the upward arc of government spending on workers. According to a City Journal writer, the reciprocity existing between compliant politicians and influential public sector unions has left California with higher taxes, poor services and a disappearing middle class. - The Foundry