Who built it?

This morning I saw a post from a High School friend on Facebook commenting on the following blog post by John Green (of “The Fault in Our Stars” et. al. fame):  http://fishingboatproceeds.tumblr.com/post/30565841330/i-didnt-build-that

In an election year that is charged with hyperbole, this is a current end to a back and forth debate of “who built that?”  It is most prominently/contemporaneously a counterpoint to a punch-line of the just completed Republican National Convention, where many a placard stated “We built that”; a clear indication that it is those entrepreneurs that invest or develop businesses that are the engines for prosperity and job growth in the American economic system.  This article (the blog post above) cites the opposite thesis, in that, it is not “you who built it” but the system and workers that work for you that built it, or at the very least made it possible.  I have posted elsewhere some notes on economics, but I think I need to wade in on this banter between two poles that seem unwilling to see the common ground between them.

As I cited in my comment reply to my friend, this is not an “either/or” proposition, but one that needs to be recognized as a “both/and” proposition.  We need individuals that are risk takers, investors, entrepreneurs, business owners, capital investors, and industrious to help drive the economy.  We also need to have stable markets, consistent and just courts and laws, effectual government, protective regulations, and investment of all forms of infrastructure to enable our economy to flourish.  Using an eastern metaphor, you cant have your ying without your yang.  We need the creative chaos of individual actors in free markets to be tempered by the needs of society, and we need the rules of society to support, not hinder, the individual to be willing and able to succeed.  At their core, both poles in our political discourse are missing the critical fact that they need each other; neither theory works without the other.

For my part, I am tired of the rhetoric that our discourse has put forth, especially in light of the facts on the ground evidenced by the actions seen in history.  As one of my most favorite historic figures Abe Lincoln said, “Your actions speak so loud, I can hardly hear what you say.”  Republicans touting themselves as budget hawks and fiscal conservatives turned a surplus government budget to a deficit, and that was before emergency spending after September 11^th.  Democrats, wanting us all to believe that tomorrow can take care of itself, continue to enact stop gap budget measures to shore up what is rapidly becoming an untenable safety net and enacting new entitlements by framing them as a “right” we all ought to have, that we can’t get close to affording (I will not delve deep here, but global evidence cannot even get close to supporting a right to healthcare, it is a privilege and based significantly upon the culture and prosperity of it and the actors within it).  Both parties have and continue to fail to level with themselves, never mind the American people, that neither side is right about substantial economic policy on their own. 

The reality is that we have so mortgaged our future, that we have to start looking at the next page of the American experience, one that isn’t as rosy as they want to paint; but also isn’t one we can’t overcome.  Our hope isn’t in post-WW II euphoric unleashing of the arsenal of democracy, but instead in the power to put on the yoke of the burdens we have wrought through overreach in some cases, and simple necessity of history on the other, and plow a new field going forward.  This involves a step into the place my grandparents experienced in the 1940s, that after a massive contraction in their lives, they opted to accept rationing, and sacrificed being able to drive to a station and get gas on demand, to be able to afford to pay to save the world from tyranny.  Since that time, we have gone from being savers to being debtors.  We shouldn’t see our future as a downgrade, but an in-grade.  By each individual and all of us collectively reassessing how we engage in our economic lives, we can not merely pay for the errors of almost 50 years of borrowing tomorrow, but again become the vehicle of growth in the world for the next 50 years or longer.  This is not a cut and save or a spend and borrow scheme I am talking about; both are colossal failures on their own.  But, we need to invest and capitalize.  Many eons ago I learned that probably the most important reason that the Roman Republic/Empire became what it was, was because of its infrastructure and its granting of citizenship to the people they conquered.  It was an investment in infrastructure by the government as a collective good and the capitalizing on the ingenuity and drive of new vigorous races and people that enabled the phenomenal growth and prosperity of Rome to last well over 500 years.  This is the strategy we need to employ, it’s a “both/and” way forward, one that is in the center if we are only willing to gain the humility to see it; “we both built it together”.

CBA letter to the NHL

The following is a letter I sent off to the NHL last week in regards to the ongoing contract negotiations between it and the Players Association (NHLPA).  As a general fan of the game, I really dread the possibility of another work-stoppage.  Take a read:

August 16, 2012

National Hockey League

1185 Avenue of the Americas

New York, NY 10036

Dear Commissioner Bettman,

I write to you today to express my great concern about the trajectory of the current Collective Bargaining Agreement (CBA) negotiations.  While I self admit that I am not fully knowledgeable about the details of the negotiations, and I rely substantially on media reports which cannot hope to fully describe the facts (and in some cases may distort them), I am greatly saddened to learn that there is a strong potential that another bad day for the game of ice hockey may be on its way.

Let me succinct, having any kind of work stoppage is a bad day for the sport of ice hockey and is a bad thing for everyone, owners, players, and especially the consumer who pays in to make the sport a success.

The National Hockey League (NHL), like any other sports franchise, is a business fundamentally, and ought to be.  Ultimately, it is an entertainment business that engages its customers in spending their income on something that is not required to sustain life, but hopefully enlivens it.  To work, there have to be consumers who are willing to pay for not only the expenses, but also enough to prolong and make an investment in the industry worthwhile.  So in essence, I do not argue the economic facts that the owners need to make a profit, the players need to make a requisite amount for their services, and the consumer has to be able to be willing to pay the ticket/concessions/merchandise costs to make it all work.  A work stoppage, as you have now seen twice, is a serious downer for any and all of this to work.

I am fundamentally a fan of the sport of hockey; the NHL surely, but more centrally the sport of hockey.  The NHL as the flagship form of the sport is critical to the image of what the sport is in the wider marketplace of sports generally.  I concur with your numerous reiterations that hockey has never been faster, more talented, and simply better than it has ever been thanks to the level of competition and what is put on the ice in the NHL as a product.  I, for one, have been glad to see the rise in market share the NHL has gotten relative to Basketball (NBA), Baseball (MLB), and Football (NFL) in the US.  Hockey is really on the verge of not being the perennial “next rung” sport in the US market, but instead be on par, or even perhaps surpass some of them in terms of viewer-ship, following, and overall profitability.  There is, however, the specter in the closet that the NHL cannot be counted on to get past itself to rise to a true contender for prominence, and another work stoppage would backslide all of the gains you have made; I say again it would be a sad day for hockey.

As I said, I am a fan of the sport, and I play the sport.  The groundswell of support that ice hockey is getting in areas across the USA at all levels is there because of the absolute interest that the sport has garnered at the professional level.  Looking purely at the NCAA college hockey scene, there is excitement at all levels, programs are growing, and more schools are seeing that hockey is a great addition to their portfolio (especially as women’s hockey has really flourished in the US).  If the NHL doesn’t have games, I can promise you I will get my hockey fix, and it very well be a switch that is made that may have repercussions of frequency for when the NHL is back playing.  I am sure I am not the only fan that is out there that is gravely concerned that the modus operandi for CBA negotiation cycles is that there is going to be a work stoppage in the NHL henceforward.  That kind of thinking makes any potential work stoppage a bad day for hockey.

Lastly, because of the international nature of ice hockey, I would hate to see the best league for hockey move from a North American center of gravity to Europe.  The KHL has continued to prove it is highly competitive and is starting to draw serious prospects that are delaying coming to the NHL., if not altogether choosing to stay in Russia.  What has been the hallmark of the level of play in the NHL, which the best players in the world come to North America to play, will be seriously damaged, if not destroyed if there is yet another work stoppage.  Again, a bad day for hockey.

Mr. Fehr has offered that the NHLPA is willing to work on some sort of interim level or agreement into the beginning of next season, it would seem that the owner’s side has been a hold up for any hope that an interim accommodation could be made.  Again, I am without the benefit of the full facts, but I implore you to not allow the season to start late or a single game be cancelled as a part of the present negotiation effort.  As I opened, this is a business decision on a fundamental level, and I don’t want the business of hockey to suffer because of intractability on any side.  The best answer, the non-damaging answer, is that you and others work through the challenges and come to an agreement for a long period of time.  If that is not possible, get into place an interim agreement that allows hockey to be played while the parties hammer out that long-term deal.  I am all for tragedy on the stage and accepting of the agony of the defeat of my favorite hockey club on the ice, but I am forcefully against a tragedy that can occur because those in board rooms and in front offices won’t see the forest for the trees, inclusive of their own best interest in starting and playing this next season on-time and without a break in work.

Thanks for your reading the above and willingness to see this through to a good and fruitful end and simply not have a bad day in hockey.

Yours,

Erik C. Backus, P.E., LEED AP

Hockey Fan

Reply to Pat - Trust in Politics

As per usual, my posts are prompted by friends and great thinking.  Today my fraternity brother, Pat Aurience posted to his blog something that is really good, take a read at: 

http://paurience.blogspot.com/2012/06/why-i-am-incompatible-with.html

Here is my reply and response:

Pat,

Great post, and I am similarly concerned.  It does come down to trust, but my question lies in why is it we don’t trust?  Now in asking this I am not asking why we don’t trust our current leadership, because you laid that out quite well.  My question is how is it that a government, or as Alexis Tocqueville stated, the American Experiment, has devolved so far that we feel that a government founded under a preamble that starts, “We the people, …” cannot be trusted?

I see two fundamental possible answers:  1) that there is something wrong with the people or 2) there is something wrong with the government.  And/or there is the possibility it is both.  I also think we have a bit of a complex regarding our founding generation and the perfection or lack thereof they wrought in the founding of our republic.

On the people side of the equation you have tragic voter apathy, civic institutional membership apathy, and you have complacency in our way of life.  I saw a recent poster that showed that the last national election had a 38% participation rate as compared with the Iraqis at 95%.  If having 62% of Americans sit out from the election process in a democratic based society doesn’t spell disaster for making the political process responsible, I am not sure what does.  My hometown Boy Scout troop recently posted to Facebook the fact that it may fold next March because there is no one who will step up to be Scoutmaster.  I serve as the President of my Lutheran congregation, and it continues to be challenging to fill the council seats, never mind actually having committees to do the ministry of the church.  I also am a participant in many regional and local government efforts (through my work) and when you look at who all is partaking, its mostly technocrats, professionals and those that at the table as part of their job/local politician's office; citizens represent less than a handful.  A recent politician said corporations are people; he was only partially right and only if I take his message out of its context.  Institutions, no matter what they are only as good as the people that take part in them and work for them.  In a representative society, we have no choice but to partake, as our lack thereof allows for others to make choices for us.  The less and less we engage, the more and more it becomes a smaller group telling the larger group how life is going to be.  So apathy, both at the polls and in the hard work of meeting and grappling with issues with our neighbors (broadly and locally defined) is a vicious spinning whirlpool that only continues to go downward until something breaks the cycle.

Now why the apathy?  I contend that Americans default to a role of being lazy, complacent, and unwilling to have to face up to responsibility.  Your notion that we ought to be responsible for ourselves is not misplaced, but we like the fact we don’t have to be.  Just think about the last time you were in a car accident.  We like the good life, and we get disturbed when we are inconvenienced by the fact that we live a privileged life that the vast majority of the globe could only wish to have.  We have building codes that require public water fountains that provide free water to anyone who walks in.  I can promise you that in Africa, Asia, South America, and even parts of Europe such a provision would be seen as an absolute luxury.  How can American’s say that healthcare is a “right”, when children can’t get malaria pills in Africa, young women can’t even find a doctor to give birth in Central Asia, and there isn’t even a hospital on most of the south pacific islands in nations like Micronesia?  Perhaps our first place status in obesity is the icing on the proverbial cake in this regard.  My point is we, as a people, take everything for granted and, as I see each successive generation post the Depression/WWII generation come to the fore, I see one that feels more entitled and yet less willing to earn those entitlements.  I can speak from my own experience in this regard, being a part of the 1% that has chosen to defend the rest, even I feel a sense of entitlement that I may or may not deserve.  We have a lack of housewives/husbands, engineers, doctors, technologists, laborers in the political process because everything is seen as “their job/problem” and not ours.  Our problem is the great run of the Pax Americana is going to close unless that changes drastically.

So that is the people side.  How about the institution; the government?  I have written elsewhere on this, but there are several things that are broken that we need to relook.  I would contend that the direct elections of Senators is one.  While repealing the amendment that allowed for this would be less “democratic,” it would reassert a balance that has been lost with regards to: a) separation of powers between the states and the federal government, b) the ability for lobbying in Washington (albeit in the states it may still yet occur) to drive the agenda of the body because Senators are not beholden to running for elections publically but with the state legislators (albeit they are politicians too, but I will get to this), and c) keep them from getting as radicalized and give better geographic influence instead, thus weakening power of political party in this body.  Another issue is the problem that on a per-capita basis, each of our representatives in congress have way too many of us to represent.  The result has been ever growing distance between the voter/opinion holder and that of the one that is supposed to speak for us.  While it may become unwieldy (which may end up requiring a two tier body), I would suggest that we cap the number of people any one representative can represent at a specific number.  Having 435 people represent a nation of over 300 million can’t even get close to addressing in a real way the various concerns and enable the brokering that is required to effectively govern.  I firmly believe the closer the politician is to the people, the less radical, the more responsible to them, they become.  I would also assert that with a representative body that is larger, the media would have a harder time keeping up, thus, perhaps, making their influence on the process decrease.  There are also legislative things that can be done (relook how we budget things (somewhat ridiculous to run all of the things that government ought to be doing on one year increments) for instance) but I think we need to also look long and hard at where we came from and where we are going to in our government and our society.  The constitution has proven a reliable and malleable document for us for over 200 years.  The question is, isn’t it high time we review and rethink it given our separation from the milieu where it was formed?  It became clear that the articles of confederation were not working well, so a group came together to write the document we have today, and that was within a decade.  How much longer should we rely on a document that was lucky to survive its first 25 years?  I am not one for throwing the baby out with the bath water in this regard, but if some trusted men and women came together, statesmen of good repute from all walks of life (just imagine if Bill Gates, Colin Powell, Oprah, Bill Bradley, and others got together and put in 6 months of effort) redrafted the document, what it might look like.  In my final analysis on the two sides of a need to regain trust, I think that without fixing both sides, ourselves as people and our form of government, a “more perfect union” is still in the works.

My final theme is our god complex, as a people, about the founding generation.  It is often hard to separate fact from fiction with this group; who can’t remember the cherry tree story for Washington.  But the more you study and know this generation and each generation subsequent, the more you realize that there has never been a “golden age” of good governance in America.  Our government, from the get-go was filled with flawed squabbling people.  Whether it was the prima-donna Thomas Jefferson or the unscrupulous Aaron Burr, or it was the headstrong and unabashed Alexander Hamilton or the overly analytic John Adams, or even the head in the sand Washington, the founders couldn’t be trusted, ask George Mason.  I contend that America still hasn’t a clue as to what it wants to be.  The tension of rights and organization, the tension of states versus the federal, the tension between legislatures, the courts, and the executive, all remain unsolved and a work in progress.  Lincoln was right, our founders “brought forth on this continent a new nation, conceived in liberty, and dedicated to the proposition that all men are created equal.”  And we also are “testing whether that nation, or any nation, so conceived and so dedicated, can long endure.”  Our role, our job, I suppose, again using his words, is to ensure “that government of the people, by the people, for the people, shall not perish from the earth.”  To sum up from Tocqueville, “Let it not be said that the time for the experiment is already past; for the old age of nations is not like the old age of men, and every fresh generation is a new people ready for the care of the legislator.”  We need to get on with the business, because no one is going to do it for us, and no one can build the trust until we do.

Yours,

Erik

Free Market Economics, History, Thoughts

Of late, I have been following, as most American’s have, the reports, commentary and opinions in the political sphere regarding the economy.  The strongest, or more accurately, most clarion voices in this discussion have been those on the political right calling for “free markets” while those on the left focusing on protecting the poor, the elderly, the vulnerable desiring “fair share” economics (at least, at this moment, this is the core of what I am hearing; thus, putting a label on it is very hard at this point, making it muddled, and thus less clarion).  This has gotten me thinking, more about the former position than the latter, and its place in history.

What this got me thinking about is when in history have we seen a pure free market economy in action?  I will not sidetrack into what a “free market” economy is except to say that it, in its purest sense, is one based on individual sovereign right to act/own things, in which the exchange of goods and services are evaluated, developed and done based on individual perceptions between the parties involved without any outside influence or stricture.  So when did this occur in history?  When was the golden era of free market economics that we can look back on with longing eyes?

I would posit that perhaps one such era was circa 600 AD in Northern and Central Europe.  I use this point, given that by this time, the last vestiges of Roman governance were void and the collection of tribes and government control of commerce was nearly non-existent.  Coinage, the medium of trade in the Empire, was still around.  However, there was no central system to provide controls on the use of coinage or even determine its value.  It was also an era well before the Carolingian dynasty started by Charlemagne, lulled Europe into feudalism and the manor system of much study in our high school history classrooms.  It was a period when what you could get for something was what you got.  It was a time when the rules were what you made, and your power to enforce them was based on your ability to garner support, by charisma, the sword, or whatever means you might have.  Save for familial relationships, you were unbound to stake claim to what was yours (or you supposed it to be) or to stake out to a new place so long as you had the means to carry you.  There wasn’t taxes in the sense we know them, however if you sought security or other things from someone to protect you from the bands of thugs that abounded, you would pay a portion of your bounty to one who could prevent their stealing.  Matters of justice and equity were resolved in the most basic of manners, retribution or revenge, until the rounds of which lead to exhaustion of family lines or physical separation and/or settlement between the mutual parties.  I could dive into a satirical painting at this point, but I am trying to be quite serious.  In the utter chaos of the loss of Roman administration and before secular or religious administration could take hold, this period was one where there was the true unfettered interference of government, government of any type.  A “free market” economy?

In putting this example forward, and admittedly it is an extreme case and somewhat still flawed, I am trying to provide the purest example of what the logical conclusion of a fully free market economy would be.  I would not say, in any way, that I think this is the best system or that it worked well.  Nevertheless, it was an economy, for its time, which was without stricture of false markets created by floors or ceilings imposed by governments, without tariffs protecting the weak from the strong, and it was fully functional for a period of years.  I for one would not want to go back to that kind of system, nor do I think those that purport to support “free markets” want that kind of system in reality, but it is the consequence that their rhetoric is calling for.

I could cite other more modern examples (perhaps an ironic but good one might be Afghanistan from 1991 to 2001, or numerous African cases), but I think the point is made that no one, if you think about the inevitable conclusion, wants pure free market economics.  Businesses want to have predictability and stability in financial markets and laws that give them a shield of corporate protection.  People want to have a reasonable expectation of stability and support to ensure contracts are honored and equity is established between parties, never mind wanting safety for themselves, their progeny, their liberties, and their property.  Thus, enter governments, that have existed since time immemorial that regulate the transactions of groups and individuals to provide this level of protection and stability, especially after having gone through the dark ages of chaos that nearly every society has encountered at one point or another in its history.  So order, order established by some form of government, is good for the development of an economy, one has to submit.  Thus, fully free markets are not what are desired, but disciplined markets with relatively free actors are desired.  The degree of discipline in the market and the relative freedom of the actors is still left for conjecture as to the right mix, fully submitting that fully controlled economic systems are just as inadequate as full free market economics (e.g. Soviet market control, state controlled feudalism, etc.).

I will be the first to admit that I do not empirically know what the right balance is.  One cannot discount the individual actor and their rational or illogical/poor choices (the Austrian school) nor can one deny that there are trends that ring true about supply, demand, price controls and tariffs (Keynesian economics).  I submit that both sides have Pollyanna visions of their positions.  The right, that everyone will act in a way as to not damage others and everyone will be able to have equal opportunity; the left, that the government will not quash the individual actor and that people will be equally industrious in their pursuits.  My thesis was what was a “free market” economy that I can draw from history, and what does it mean.  I have not even entered into a religious or moral argument as a part of this effort.  Regardless, however, I do not look with longing eyes on the closest to pure examples that I can think of for “free markets”, so I am not sure that a golden era exists for them.  While I could do a similar analysis for controlled economics, and find it equally undesirable, it really is already in evidence given our very near-term, bipolar, communism – democracy struggle of the latter half of the 20^th century.  I cannot speak for the left of the political spectrum, but I do not hear rhetoric for state controlled economics like the rhetoric I do for “free markets”.  I would beg those that are supporting “free markets” to be careful that they do not destroy the centrist disciplined economy with relatively free actors that truly uplifts all.

Clean Energy discussion from back in 2010

The following is a reply I made on 9JUN2010 to a post made on facebook back on 2JUN2010 related to the realities of "Clean Coal" as it was used in the lexicon of the time, by a collegue of mine, Colin Bennett of the George Mason University Sustainability Office.  While a tad old, I thought I needed to get it into my blog posts for some wider readership than a reply to a facebook post gives.

"Colin,

Thanks for the open letter and I greatly appreciate your perspective and taking on this issue. I too agree we need to call things as they really are, and “----- coal” is simply not clean from a purely objective, bottom line point of view.I do have two comments on this however:

1) One of the tragedies of environmental and energy sustainability is the hyper-sensitivity of the general public to the drawbacks to nuclear energy. When you say “nuclear” two things come to mind: a) a mushroom cloud or b) the fallout of Chernobyl. We have to recognize that so long as we require energy to live our lives (and turning back the clock on technology and a way of life without it is highly unlikely) we have to have an energy source to power them. There is no energy source, NONE, that does not have a draw back in some way that has potential to hurt the environment. Nuclear is no exception, and I am not going to try to convince you otherwise. But I will state that most people discount it so rapidly because of the over-hyped, over-scared, over-stigmatized campaign that was waged for the entirety of the Cold War period. The immediacy of the end of the world as a result of nuclear war, and radiation, was pressed upon insidiously through all forms of media and was amazing pervasive. The parsing of the difference between a rocket with a nuclear warhead and the image of the cooling tower as being distinct and starkly unrelated was never emphasized in this context. Consequently, pressing now, like many nations have, for energy independence through the use of nuclear energy is not just smirked at in some circles, but seen as antithetical to being environmentally friendly. I bring this up in relation to “----- coal” because, I think all of us who are fighting for the world to reduce GHG emissions, need to remember this past history and not over stigmatize something to the point that we have done with nuclear energy. I say this because of point #2.

2) With regards to fossil fuels, specifically, when we look at defining the broader “sustainable energy future” we must recognize that there are two ways to define “sustainable” that may or may not be congruent.

The first, which I think we both subscribe to, is based upon a world-wide view of ecology, resources, and sociology that desires us to overall reduce our net consumption of the earth and, if possible, enable it to be in balance such that the current net ecological trends can be reversed or at least stabilized for the future, infinatum.

The second, which we have to acknowledge, is that a society uses such resources at its disposal such that they are renewed or enable continued growth in such a way as to not further curtail consumption or enable us to continue in the social norms we have for the foreseeable future and doing so without harm to others or the planet, as much as is possible, at the same time.

While we would all like to see the end of fossil fuel emissions as a way to stop the vast majority of GHG emissions, I will tell you that no matter what happens in the future, burning things to get energy from them will remain fundamental in societies as the grow, especially in the developing world, for the decades, if not centuries, to come. This is mainly because much of the global south finds itself either in a position where it is prohibitive to develop non GHG power generation schemes (capital outlays and credit extensions are out of reach for massive solar, wind, or hydro projects) or they are banned from them (fear of any kind of nuclear proliferation is at the cornerstone of this). As a result of this, many of these nation states will continue to try to use definition #2 of sustainability, if they are even that egalitarian. So finding ways to better burn things (e.g. "cleaner"), such as dirty coal, is not an unworthy investment of time, material and human energy; and, honesty, should be encouraged. We just have long way to go to the point where fossil fuels are going to be dinosaurs again. One of our keys to making sustainability work is making an economic model that turns environmental stewardship into a net profit maker, not a “cost of business”, and, while it isn’t a final or “best” solution, developing and looking to use “----- coal” technology, until we can realize an economy that does not ignore the maxims of the first definition of sustainability, we have to press some measures that are interim and at least making a step in the right direction.

Thanks again for your heartfelt and on target plea. And I thank you for the chance to comment on it to ensure that the “green dialogue” is indeed a dialogue that all can get into."

Thoughts on Death – A New Beginning

So, as noted on my Facebook post last night, I learned of the passing of my old college roommate and friend Jeffrey Soderberg yesterday morning.  I will not repeat all of that post here, except to say this is a man that was full of life; life in abundance, and I am glad to have known him.

This morning however, I have been mulling over the meaning of death for me both emotionally and spiritually and I feel the need to script it out to have a way to share some of this inward dialogue outwardly, especially for those that know me and wonder what goes on in that calcium chamber between my ears.

Let me begin with my first dramatic encounter with death.  When I was young, my parents, before I was aware, had adopted from my Aunt Carla and Uncle Bob in Bridgeport a male pet dog named Brandy.  From my own experience, I can say every boy ought to grow up with a dog (not trying to be gender exclusive, I just cannot speak to the other side).  Being the older brother, Brandy was often my playmate and run-around mate, at least as early as I remember, until my little brother was able to be a running buddy as well (Donald, born 3 years and 6 hours apart, thus sharing the same birthday, talk about superior family planning).  Well, after a time, this not so young dog ended up having some health issues, to the point that he burst a blood vessel in his ear.  My parents, after having paid for one surgery on the ear to correct the problem, were not in a position financially to do a second (Dad being a full time Industrial Arts teacher and summer/spare time contractor, and Mom being a stay at home mother, who worked for the teachers union part-time once we both were in school).  Thus, they opted to put Brandy down.  Timing, however, could not have been worse, as it was the day or two before my (our) Birthday; what a present.  Needless to say, I was a wreck, I remember bellowing and crying for a long while.  I was angry with my parents, blamed God for this, and thought that if I had only been able to be there I could have worked a miracle (being the son of a modern day carpenter, albeit not Jewish, did occasionally give me illusions of grandeur).

Once I had this torrent of emotion subside, I do not recall how I came around.  I do recall the sullen celebration of my (our) Birthday that year and I do remember that not too long after this (a year or so, if I recall correctly), my Great-Grandmother Backus passed on, causing much family in-fighting, which seems how the Backus’ best celebrate the passing of the family matriarch.  But I do know that this is the last time that I became emotionally wrought with the pain of loss to the point of having tears flow in rivers.  Something in me changed, and I think it really had to do with my outlook on death, that it wasn’t the end, and I needed to get on past my selfishness regarding holding onto a tangible notion of life.  Many of my spiritual and emotional growth points, I owe to maxims taught to me by my mother.  For those that don’t know her, she is an intelligent woman, with a large heart, one that sometimes gets her in trouble.  However, she also is a woman of faith, in its core a simple faith, informed well by being a Lutheran Christian, but really more universal than that.  She will tell you plainly, “God is love;” not even contextualizing that this comes as a direct quotation from John’s letters.  In this case, she really believes that everyone goes to heaven, and from there, they that pass, are active in our lives speaking to us and guiding us.  Again, this is not a nuanced or systematic statement of believe, but more of a heartfelt purposely naive maxim of truth for her, and one she passed to me (I will refrain here from going further in my current reflections on this, but see more on this at the end of this post).  But this leads me to the next death experience that has gotten me where I am.

Some years later, when I was in High School, another family death occurred that called us to Long Island, NY for a gathering of the Seaberg clan, my mother’s side of the family.  My Uncle Alan Seaberg had passed on at an age much younger than most would call standard, and being a contemporary (10 or so years older, but no more I think) of my parents, it was oft said that he had gone too early.  This is memorable to me for a lot of reasons.

Alan was a very wealthy self-made man.  His wife, my Aunt Martha, and he had built up the family business from what had been a small immigrant machinery company, to a firm that was building machines and components to feed the growing factories in Japan, China, and throughout the world.  Alan was actually my Mom’s first cousin, being the son of her father’s brother.  Both my Mom and he were first generation Americans, being that my grandparents and siblings all had emigrated from Sweden in the 1920s to the 1940s, seeking a better life for them and their eventual children.  My mother says that my grandfather Carl and his brother Victor worked to help build Holland Tunnel in NY, and were men of their hands.  Victor, Alan’s father, was a machinist, and it is for that reason that the Seaberg Precision Corp, machine company was to be, what it became.  All this history being good, it only begins to describe my Uncle.

Alan, even though he was a multi-millionaire (in a time before billionaires), didn’t carry himself as being one so much as I could tell.  Sure he had a big house in Middle Island, Long Island, NY, with an awesome pool, an old horse farm barn and track, a private pond on his property and lots of toys (adult (e.g a gun or two) and otherwise) to play with.  Nevertheless, he never held himself better than others, nor did he take care to pinch pennies, especially with family.  He had talented kids; one is now a professional musician and, another, an artist.  Moreover, he was a great cheerleader for whatever it was we were passionate about (I even recall him giving my Dad some sage advice about getting out there and expanding his business).  Therefore, when he passed in his late 40s, I can recall the outpouring of love to the family and for him that was shown.  But I also recall, that I never cried.

When he passed, albeit early by many measures, I reflected that his temporal work was done.  I am convinced that Alan was taken from us in bodily form, only because his earthly work was complete.  Not that his efforts were complete in the sense of being done and ready to ship out to the next customer, but that he, like my friend Jeff, had touched so many lives in such a way as to never truly die, instead God has called them home to do other work and to empower other actions.  I can tell you for my own part there is a specific portion of me that continues to emulate and follow in his footsteps.  As I indicated, he was a generous man, especially with family (trust me, his lobster barbeques are still recalled with much admiration).  To this end, while not being of his means, I give as generously as I can, to my church, and especially within the family.  Luckily, my wife is very much of the same mind, and we have had the privilege of being able to host her brothers here at our home in the DC area for large stretches of time, which I continue to see as a greater gift to us, than to them, in many ways.  This gets me to my next confrontations with death.

As can be told by the time spent on them, these two passings probably had the most impact on my life.  But I have had others that have taught me lessons that really extend beyond these primary experiences.  One was the passing of my grandmother Harriet Hall (formerly Backus).  Born in the Depression era, having lost her first husband, my natural grandfather (when my Dad was a pre-teen), she raised two boys, became a known local English and French teacher (so much so that my HS Junior year English teacher came to her funeral and recalled to me how much she had learned and tried to pass on from her) and Librarian, and eventually remarried a gentle, honest man, Stuart Hall.  Having survived both of her husbands, she eventually suffered a stroke that slowly sapped the life out of her.  My father, being the primary actor in her later years, carried the immense stress of not just dealing with her various legal and financial matters but coalescing things to the point of a decision that her time was done.  As she passed and understood all that was going on (her mind was keen, even if weakened by the strokes), it was in her rest that we saw again that gleam that was a hard fought life.  So I learned in this that life isn’t simply breathing, and having a heart pumping physiologically, it is a spark, an essence, a soul that carries us forward; one that we should be very careful about trapping in the confines of the corporeal for our own selfish reasons.

Another, nugget came from the death of a student at Clarkson University in my senior year.  This student, Remmi, had succumbed to alcohol poisoning and passed on at a very young age.  I had only known him in passing, but knew of him in the sense that he was active in the social scene that was in Potsdam, NY.  While there are several facets I can discuss about this situation that can lead to a stigmatized conversation, I believe the lesson that I learned here, is that death can spur action and cement convictions.  For me this incident, this loss of life, was one that fits into the “could have been prevented” column.  However, in the larger sense, while perhaps true, his death has had life now as we contend with the issues that surrounded his passing and determine a path forward to address those issues in our society.  Again, for me, God has a reason for how things happen; this isn’t pure pessimism that we can’t control our own destiny, but it does say that we are given the tools, abilities, and concepts to grapple with this world, and that, in death, we continue to be an active part of that grappling.

Finally, I cannot forget to cite my near death experiences and their effect on how I see the end of corporeal life.  As can be seen from the outset, I am a soldier, and I identify with that profession as much as I do of being an engineer.  Having had two combat tours to Iraq, I have had my brushes with my own mortality.  Sometimes (like the first instance) someone had to tell me we were shot at, and then deal with the possibility, other times (like when Paul Drezen pulled me to the ground during one artillery attack) it was utterly clear.  During the first year of the war, while phone privileges were limited, I made a point of calling Jackie, my wife, before I would “drive across town” (a.k.a. convoy across Baghdad and its environs) to let her know I was alive, and try to call her as soon as I got back (having done several dozen such missions, this wasn’t always possible).  My combat experience has taught me several things about death in this light.

First, we should not try to go out and get ourselves killed, but the randomness of violence in war, makes this possibility very real.  Thus, I am not about to hide on the FOB (Forward Operating Base, as those on my second tour can attest) because we cannot possibly win the war from the FOB (we have to engage with the population and grapple with the enemy), but I am also not going to just jump at the chance to run out and commit suicide.  While I know there is a providential nature to death, and life goes on well beyond the grave, we have a responsibility to do the work we are called to do, through the hazards taking the precautions that are reasonable to the task.

Second, we should assure that we have a plan so that the temporal nature of things does not become the burden for those around us in our passing.  The Army has taught me to have a battle book for the spouse when I leave, and we do that.  She has all of the key info, so if the worst happens, she knows how to contend with the legal, financial, and other aspects, and there is plenty there to do what needs to be done (and even if she can’t, there is a tool that can help another do it with/for her).

Lastly, we need to get our priorities straight in life.  Once you have had these kinds of experiences, certain things in life change.  Somehow, the excitement over inconsequential minutia fades into nothing, and the desire to spend time with loved ones and engage in passions that you have become more critical.  Answering one last email becomes so less important than being there for your wife’s surgery from beginning to end.  Stress and how you deal with it changes, and I know that your reliance on others, and especially something greater than yourself, becomes critically important.  This all enables you to see death in a very different light.

Closing out, I want to get back to the maxims that my Mom spoke, less in wisdom and more in blind faith, as a child.  “Everyone goes to heaven.”  Again, this is simple and profound.  As I have grown and experienced, the more and more I get back to this myself.  Years of study of church theology, especially Lutheran and Catholic fathers, as well as the Bible, reveals a dividing line between the damned and the saved, but this line is as fuzzy as it is defined.  The truth that all are saved who believe in Christ Jesus, and his is the only road, is not to be denied by me, as this is my belief.  Nevertheless, what is Christ Jesus and further what “belief in” means, these are ageless questions.  A fellow soldier once described God as if he were a full sized statue in a rotunda.  From each angle, you get a different view, yet not complete and yet still the same God.  Therefore, for Christians, God looks like a Jewish carpenter from Nazareth, for Muslims he is Allah, for Buddhists he is enlightenment, yet the same statue.  I am not one to say relativism is right, and I am not trying to contend that there are not real differences between faiths, but there are kernels of universal faith that exist throughout (e.g. as St. Paul says, “[t]hat piece of Christ that passes all understanding …”), and thus, “everyone goes to heaven” isn’t entirely without theological basis.  Another: “God is love.”  Not being a Christian Scientist, but having two adoptive grandparents who were, I am highly appreciative of Mary Baker Eddy’s exploration of the love chapter in Corinthians.  She takes the word “Love” in this chapter, and replaces it with “Faith”, and then “Hope” and then, finally “God” (e.g. God is patient, God is kind, …).  While on a whole of scripture perspective this beautiful rendition of this favorite chapter cannot be taken literally in every aspect (e.g. “God does not anger, …” would be refuted in the Old Testament through such examples of his anger with Moses or with Abraham), it does reveal something about the divine.  It says that you can bank on “God is love,” as being your cornerstone.  He is one with creation, and therefore creation is love.  He is one with our hearts, thus we are loved.  He is the great parent, and he loves us in the same way.  And if you take that beyond the temporal example, we recognize that a God that loves, loves us so much that we can die and yet live.  When someone dies, it is my love for him or her that continues forever to speak to me.  So in reflection, part of me continues to believe that death is not the end, mainly because how can my love ever end?

As Jeff is the latest person to be called home that I know, I again am not saddened as much as resolute.  I know he has done his work, it is not how I would have thought his life would have ended, but I know it was not without meaning.  I am not sure what I will take away from this experience, but I am convinced it is not the end, but another beginning, one that will not end, at least in the way we can comprehend.

Thoughts on Economic Growth

I meant to post this earlier this week, but didn’t get to it until today.  Earlier this week, James Stewart, a fellow member of Omega Lambda Tau Social Society (a co-ed Greek organization that I helped found at Clarkson University) shot out a note about Warren buffets recent opinion piece on “Coddling the Rich”.  James is an unabashed conservative thinker, especially in regards to economics, and after my response to his tweet, he threw out the following:

“As a thought exercise, what policies would lead to a larger middle class while not increasing the number of poor or rich?”

My response follows, addressed to him directly, but I think worth sticking up here as a post.

Stew,

Thanks for the spelling help.  Good question and one I wish we would focus on.  Here are my suggestions, which are not all complete, but some are stabs that can help or concepts to start with that can be fleshed out:

1)      Lower the Corporate Income Tax rate to circa 15% or so, or at least drop it to a point that it makes it competitive with other major industrialized countries.  Rational:  We need to encourage business growth, within corporations not sidelining monies to offshore or other non-US locals, to keep investments domestic.  When tied with my other ideas, the concept is to not pay out dividends, but grow business and markets with the goal of increasing exports in the long term.

2)      Segment and split capital gains taxes.  For instance, I would increase capital gains taxes on payout of dividends, but drop or moderate them on the gains made on the trading of securities.  Likewise, I would lower the rate on real estate transactions, so that is becomes attractive to invest again in real estate.  Right now we are painting capital gains with a wide brush, and this needs to be looked at carefully.  The goals we need to have are to allow business to grow, but not pay out huge dividends to those that hold the securities and, rather, encourage them to reinvest in either that company or other emerging companies (thus expanding capital venture options).  Likewise, we need to jump start our real estate market by making it attractive to make gains that derive from that market.

3)      Alter the progressive tax code to add at least two more tiers at 500K and 1M, and cap the amount that can be offset by donations (and this shouldn’t be minute, but also not too large an amount (a.k.a. circa $250-500K)).  Individuals holding wealth does not breed more wealth, it stuffs it under the mattress.  The goal ought to be to discourage holding sizable personal income, but instead invest that money in businesses (see above) and look to derive gains from sources that spawn more wealth.  I support progressive personal income taxation, as there is a distinct opportunity benefit derived in this economy/this system from one being able to incorporate and “make it” based on your own merits with relatively limited interference/control by the government in your endeavor, and those that benefit the most have gained a disproportionate amount of that benefit.  This is antithetical in some circles, but I would also indicate that if we allow individual incomes (please make note I am not talking about corporations) to climb and concentrate in a few hands, in a near-fixed wealth environment/resource constrained world, then there will be less that have the means to buy the products and services that are produced, thus decaying the ability to generate wealth through the creation of said goods and services.  In other words, having a group to sell your goods to that has the means to buy them, enriches the seller, and, if reinvested, creates more buyers to sell to and further enrich.  This is not socialistic, it is precisely why and how Henry Ford was successful.  He made a car that his line worker could afford and paid wages to them that enabled them to pay for the cars made, building a working class, enriching Ford Motors, and, honestly, having a drastic effect on the macro-economy as a result.

4)      Preserve the home mortgage interest deduction for your primary residence and up to one other property.  The value of this deduction, however, would have to modulated and caped at the median rate of the cost of homes in the geographic area you live in.  Ergo, if you have a house at medium value for the area you live in, you get the full deduction for the interest payed.  If however, your home is 25% above that median value, then your deduction is on the interest paid is reduced by 25% (so a house at double the value of the median price in that market would not get a deduction on the interest paid).  Simply this allows a double investment in real estate, to help spur that market, but controls the market from over building, especially at the high-end, by keeping housing values somewhat homogenous as the value of the benefit decreases.  This helps grow the middle by encouraging home ownership, but also not outpacing the growth in housing values with income.  The measure of assessed value would need to be looked at, but given that almost all jurisdictions do some sort of assessment, it could be the full value assessment of your local municipality as the basis.  Lastly, this helps elsewhere, by allowing a second deduction, to enable rental properties to be available and attractive, thus giving a stepping stone and method to buy-in.

5)      Remove targeted tax breaks unless they support investment in infrastructure or commercial competitiveness that is already in evidence and creates domestic jobs.  I support an infrastructure bank concept (e.g. tax outgoing transfers of capital from the country to enable the building of revenue to put into infrastructure here at home) and short term, up to a threshold, assistant breaks in federal taxation for specific technological or market innovations that employ people here at home.  Infrastructure is a sunk cost to doing all of our business and also enables the commerce to flow, thus we need to invest and reinvest, constantly, in improving and rebuilding the fundamental pathways to do this (e.g. ports, rail, roads, electrical systems, networks, water, energy flows, damns).  Ideally, spend on infrastructure so that it is truly sustainable, not just environmentally, but socially, economically, and from a protective perspective.  Critical to this would be to convert our oil based transit systems to some other domestically available fuel (gas and electric) by developing programs and incentives to build natural gas stations to enable natural gas cars to take off, for instance (e.g. the Pickens Plan).  We need to kill things like long term oil tax breaks, or farm subsidies like we have today, that result either in gluts in markets (depressing prices and reducing jobs), or that are not in our best interest, long term, to invest in (e.g. oil infrastructure).

6)      Address long-term entitlements, specifically Social Security.  There needs to be several things put in place:  a) Means testing that says if you are able to support yourself over a certain floor you will have scaled back benefits to a certain ceiling.  The floor should be set at a level that accommodates a median income level within the geographical area of the person in question as compare to an active worker, and the ceiling would have to be at some percentage (say 25%) above that level.  The essence of this is that we should not be paying out social security to those that are socially secure.  b) recalibrate the full benefit age (for the old age portion of the benefit) for anyone that was born after 1975 to be 5 years earlier than the life expectancy for them at their 40^th birthday, and partial benefits at 3 years prior to that.  I have mentioned this before elsewhere, but the point is social security was not intended to be your retirement income, and at the time of its original passing life expectancies were much lower than today.  The goal ought to be to allow for a reasonable time for folks to terminate work and enjoy the end of their life, and have social security in doing so, but allowing folks to get 10 or more years of benefits is well beyond the original scope, or what we ought or can afford.  c) remove the cap on payments into Social Security over so much in income (I am not certain as to what the exact number is, but I think its circa $120K).  This program is to ensure that we don’t have to pay for other social welfare programs for the elderly/disabled when they are unable to earn anything on their own to support themselves.  Thus what is happening is that essentially everyone in society is hedging against having to derive other methods of taking care of the elderly and disabled by ensuring they have enough minimal income in order to support themselves.  Paying in dollar for dollar, accordingly should apply for all income levels and ranges, and not be regressive in requiring the income earned below a level to be taxed fully and above the cap not at all.  This will help with the long-term solvency.

7)      I would delve into the medical realm, but I don’t have concrete solutions to these problems, but they are problems that need to be addressed.  The problem is we have a belief socially that healthcare ought not be about the ability to pay for it, but available when we need it as a response to fundamental human needs.  But we also believe that healthcare is a service that is provided in an economic market that shouldn’t be exempted from supply and demand factors merely because of our compassion (however, we don’t want to acknowledge the cost, either, of the clean-up of bodies from streets from those unable to get healthcare).  I don’t see healthcare as a right, personally, but many do.  Much of this is from seeing how the other half of the world operates.  Until we can deal with the fact that we can’t afford to keep everyone alive forever, and get past saving life vice saving the quality of a life, we won’t solve this easily.  But, this needs some answers, and I am not sure repealing the Healthcare Law helps, nor keeping it as it is.  One last point, and I mean this sincerely on this issue and that of Social Security.  Our generation needs to get on board with the idea that neither Social Security or Medicare may be around when we need them (mainly because the supposed fixes have already been mortgaged).  Thus we need to understand that while we are going to pay a boat load for these programs, what the programs really end up being is a way for us to facilitate paying for our parents to grow old and pass-on, which we would otherwise have to pay out of our pockets, anyhow.

8)      Rethink the wisdom of defined contribution programs for American retirements.  The going trend, for many years, has been to go from defined benefit (traditional pensions) to defined contribution (401k and 403b) programs for retirements.  The challenge with this, long term, centers on the question of, is it wise to have the vast majority of Americans retirement security based on the whims of the market (bond, stock, or otherwise)?  The discussion on social security above, presumes that, like today, the majority of Americans have some sort of nest egg available to draw on when they retire beyond Social Security.  Given that the stock market is speculative, the bond market depends on the faith and credit of the institution that is borrowing, and that commodities (especially futures) can be highly erratic, putting more and more individual investors into a market they poorly understand, as a way to secure their future, creates an unwieldy situation where there aren’t strong enough economic poles that can steer the private economy away from a titanic crash.  I would submit, that there ought to be a look at creating a mix of social security, defined benefit programs and defined contributions, such that the capital markets have better direction in making investments rather than simple speculation as to the potential value increase in this or that security (or bond, or what-have-you).  It gets back to ensuring that we have some market control mechanisms, where fundamental business value trumps market value in decision making.  I believe that the old pension fund managers did well in this, as they had to get constant returns rather than speculative returns over time, and hence, defined benefit plans, while somewhat over generous in some cases, brought market stability, ergo enabled middle class growth through companies that had fundamental value rather than market value, per se.

9)      Fix immigration policy and re-look minimum wage laws.  I personally believe we ought to liberalize our immigration laws in the sense that if you are here illegally, you have no protection in the form of a minimum wage.  Honestly, we need folks that are cheap labor to compete with China, India, and so forth.  The artificial floor of the minimum wage is great, but only in so much as it is applicable to those that are citizens.  And lets be honest, are we saying that citizens really are going to want to compete with those that are willing to work for less the minimum wage (why pick fruit in California when you can supervise a crew doing it)?  Part of building a middle class up and growing it appropriately, is to spur economic activity at income levels below the minimum wage, so as to have ways to get more in the market to buy goods and services.  In the initial plug, this will add more to the “poor” side.  But as labor costs drop, companies can sell products cheaper (and overseas more readily), they can invest in increasing the worker base to get more produced, and workers are able to have a path upward to climb into the middle class as more cheap labor enters the market place below them.  There needs to be some careful analysis done in order to control the cost of:  a) housing folks so they don’t become a burden elsewhere; b) providing worker protections to not burden them health wise and from a moral obligation to not subjugate them to hazardous working conditions; c) the cost of potential criminality and, d) how to address the transition from illegal to legal, with some corresponding penalties that actually are not merely punitive, but enable the borders to be secured to better control the flow.

10)  Step back from national standards in education, and develop a Science, Technology, Engineering and Mathematics (STEM) educated pool.  Simply put, we need Clarkson grads and the like to get us going.  When we continue to churn out more English Lit and General Business Admin grads than Engineers and the like, we are going to loose our edge.  I suggest we create a program that gives States a pool of funds to get folks educated in STEM areas and provide start-up grants for entrepreneurs that come out of these pools to continue our innovation edge.  National testing and other prescriptive solutions in education hurt us, we need to be performance and outcomes based, and create incentives to not choose the easy History major over the harder Chemical Engineering degree.

11)  Repeal the 17^th Amendment.  By having state legislatures select Senators, it will modulate the federal government’s power to send unfunded and other mandates to the States, as well as provide stability to the federal legislature with regards to influences and lobbying (it would be at the state level, and actually make it more responsive to regional issues).  While seemingly un-democratic, this would actually take some of the power in Washington and deliver it to the States.  As it worked before, since Senators were sent by the legislators, they were not responsive, as much, to national lobbying efforts, because they were not beholden to popular support for their candidacy, thus didn’t need to spend as much to campaign (rather they had to curry favor with their state party reps in order to get sent to Washington).  As it is right now, the Federal Government runs roughshod on the States, and is only bound by the letter of the law, not the influence of vote.  States can then also have the power to better deal with local economic issues and be responsive to those needs with help from Washington instead of inapplicable mandates that cost States jobs.

12)  Pass a Line Item veto amendment to empower the President.  Likewise, repeal the current budget law and replace it with a budget law that budgets portions of the government for more than one year, while others are approved annually.  This way, budgets passed with deals for 10 years from now have to meet line item scrutiny and have to be lived with over several administrations.  It also forces us to live by our choices in the long and short term.  I really think that part of the government’s problem in its economic effect is that it is always planned a year out and everything is revisable.  This breeds instability, and consequently, minimizes investment in future efforts.

Again, these are ideas, and not necessarily fully fleshed out.  I think that each has merit, but each has consequences.  I tend towards Keynesian economic principles, but in the classical sense, not as described today (e.g. giving a tax break can spur economic activity, much as JFK did in the 60’s).  I also recognize what corporations and the private economy is critical to this, but I also think that government has a role to keep it within some bounds.  I think you can see here some ideas from both sides.

Yours,

Erik