Telling It Like It Is

THE ENTERPRISE-Special Independence Day Edition

THE ENTERPRISE--Independence Day special

Normally on a National Holiday weekend like Independence Day, I write an uplifting edition of THE ENTERPRISE.  But this is not a normal year.  As oil prices skyrocket, the dollar plummets, the stock market sinks and our national pride sinks with it, we, as Americans are faced with looking in a mirror at what we have become.  A nation of non-doers, a nation of nay-sayers, a nation of wimps and wusses, and all the other derogatory terms I can imagine--and I am ashamed.

YOU RECOGNIZE THE CHARACTER
Movies are not real life, but their stories and characters often portray real life with startling clarity. We have all seen the movies where the smooth, slippery "climber" finds a way to blame others, distance himself from awkward situations and generally "talk his way out of everything bad."  In the movies, such people eventually (usually) are exposed at the end.  I wonder what real life will be like. 
—A black father--keep him out of pictures. 
—A white grandmother who uses racial epithets, "throw her under the bus." 
—A role model and inspirational pastor whose radical behavior frightens many and astounds others--denounce him. 
—A financier who helps buy a house he can't afford, and later is tried and convicted for misdeeds--denounce him too--sadly, as not the man I knew. 
—Positions that sound so noble and lofty--like using public finance and debating face to face in town halls suddenly become undesirable in a flood of money and a "front runner" spot against a competent, knowledgeable old pro. 
I could go on.  It is truly frightening that those who are mesmerized by his rhetoric do not see the shifting, shading, and slippery candidate. 

THE ANSWER SEEMS TO BE: "CHANGE THE SUBJECT AND ATTACK THE OPPONENT"
Here is where his backers denounce his opponent.  But I say to you--WAIT A MINUTE--we aren't talking about the old war hero.  We are talking about the smooth "wunderkind." 

I don't know what prepares a man for being President of the United States.  Perhaps being shot down and persevering through an unimaginable 5+ years of torture in a POW camp doesn't.  But it does show COURAGE.  Perhaps refusing early release, to insist that he not go until his cohorts go doesn't, but it does show CHARACTER.  Perhaps being a member of Congress, a leader in his party in spite of some contrarian views, and a bi-partisan legislator able to broker deals that involve both parties doesn't either.  But it does show COMPETENCE.   Those three characteristics: Courage, Character and Competence have always been the marks of a leader to me. 

And finally, perhaps being attacked by a retired general who was valedictorian at West Point, a Rhodes scholar, and a wounded VietNam vet himself doesn' t either.   But remaining composed and reserved in the face of such an attack belies the old war hero's reputed fiery temper.  But that also doesn't necessarily qualify him either--at least not by itself.

THE TELLING QUESTIONS ARE THESE TWO:
A first term Senator from Chicago, with some typically shady Chicago ties to crooks, influence peddlers and radicals doesn't prepare anyone either.  Being a community organizer, politically astute and very intelligent might qualify someone. Being incredibly glib and articulate, and able to mesmerize huge audiences is certainly a valuable talent for a leader.  But that alone doesn't qualify him either.  The glibness and wonderful way with words is useless when tough decisions--the kind with no right answer--only less wrongs a facing him.  We wonder how he will handle those.   

THAT MAKES ME ASK: WILL HE "THROW AMERICA UNDER THE BUS" WHEN IT BECOMES TOO HOT IN THE TOUGHEST JOB IN THE LAND?  I don't know.  Do you?

AND WHICH OF THESE CANDIDATES WOULD YOU RATHER HAVE "AT YOUR BACK IN A FOXHOLE", OR IN FRONT OF YOU "FACING A HOSTILE ENEMY?"  I know.  Do you?

THESE ARE ISSUES THAT TROUBLE ME GREATLY ON THIS INDEPENDENCE DAY WEEKEND

ANOTHER ISSUE IS OUR APPARENT "KATRINA-LIKE VICTIM" BEHAVIOR IN THE FACE OF HIGH GAS PRICES
Europe has long paid far more than we are now paying for gas.  We have lived the charmed life--and now it is over.  Either we take charge of our own destiny or we look for someone to blame—Big Oil, the current President and VP, OPEC, rogue states like Iran and Venezuela.  But whoever we choose to "throw under the bus," the problem is still ours, and or leaders are either lying, paralyzed into inactivity by partisan politics or lack the common-sense that God gave them and that our forefathers put to such good use.

IF WE CAN PUT A MAN ON THE MOON, WE CAN DO THIS--AND WE MUST!
Few things are more important to America's future than its energy supply.  Nearly everything else depends on energy to operate.  Being (largely) energy independent could very well be a global competitive advantage in the next 2-3 decades, and is certainly a National Security imperative probably long before that.  Can't anyone in the seats of power in our government see this? 

Are they all so preoccupied with equivocating, slipping and sliding into reelection that they are afraid to take a stand and do something so important and so bold?

VICTOR DAVIS HANSON CALLS US OUT—WITH FRIGHTENING CLARITY
Victor Davis Hanson is a learned student of our social behavior. The next few paragraphs are the conclusion of his Op Ed I read in today's Columbs Dispatch.  He is commenting on our "do nothing Congress" and our national malaise of doing nothing because everything we consider, offends someone, some zealous special interest group or some outspoken "talking head."  What a shame--no what a disaster for the United States of America.  Consider his words carefully on this Independence Day weekend.

--taken from Victor Davis Hanson's Op Ed  "A timid nation loses ground, and it's us"

   

The causes of this paralysis are clear. Action entails risks and consequences. Mere thinking doesn't. In our litigious society, as soon as someone finally does something, someone else can become wealthy by finding some fault in it. Meanwhile, a less fussy, more confident world abroad drills, and builds nuclear plants, refineries, dams and canals to feed and fuel millions who want what we take for granted.
    In our present comfort, Americans don't seem to understand nature. We believe that our climate-controlled homes, comfortable offices and easy air and car travel are just like grass or trees; apparently they should sprout up on their own for our benefit.
    Americans also harp about the faults of prior generations. We would never make their blunders -- even as we don't seem to mind using the power plants, bridges and buildings that they handed down to us.
    Finally, high technology and the good life have turned us into utopians, fussy perfectionists who demand heaven on Earth. Anytime a sound proposal seems short of perfect, we consider it not good, rather than good enough.
    Hamlet asked, "To be, or not to be: that is the question." In our growing shortages of infrastructure, food, fuel and water, we've already answered that: "Not to be!"

REPEATING LAST WEEK'S CONCLUSION: 

THERE ARE JUST THREE ENERGY "ANSWERS:"  USE LESS; FIND MORE; FIND DIFFERENT KINDS—CONCURRENTLY
Three approaches are mandatory.  No one of them is sufficient to all the needs.  Why can't our governmental leaders see this?  Or can they, but it doesn't serve their political agendas to admit and act on it?  CONSERVATION (Near term greatest effect); EXPLORATION/DRILLING/EXPANSION (Mid-term large effect); and INNOVATION/ALTERNATIVE SOURCES (Longer term solution is a combination of parts of these three.)
* Most immediate impact items.

NOW: Conservation (largest short term effect, also helps mid, & long term)
    --*Fuel efficient vehicles, homes, offices, factories, stores and cities, (street lights on highways where not needed, flood lights on signs, etc) etc.—NOW
    --*Reduce usage on transportation, unnecessary lighting (Christmas lights), excessive cooling & heating, etc. —NOW  and Future
    --*Use more fuel efficient products and practices (high mileage cars, programmable thermostats, CFLs, etc) —NOW and Future--more of them...
    --*Timers to turn off lights in unoccupied offices, public places, and ultimately in homes (provide tax incentives to install them)
    --When stores, offices, plants, etc. close for the day, mandate that the lights be turned off within 1-2 hours. 
    (Companies can Install motion sensors to reactive lights for safety, if people are still moving about.)
    (Lights can be turned back o--and off-for cleaning crews, but they don't need to keep burning electricity for an entire evening)

SOON: Exploration/Expansion of Oil  (short & mid-long term)
    --*ANWR Drilling (mid-term, starting immediately)
    --*Offshore Drilling & Usage of Current Lease Rights elsewhere (short term--starting immediately)
    --Shale oil Development (mid-long term)
    --Refinery Construction & Expansion of Existing Capacity (short and mid-term)
    --*Standardization:  Reduce to two Octane levels--87 & 91, and one formulation nationally--no state variations.
    --Simplify processing & help relieve refinery capacity issues--without any refitting of gas station pumps, transport, storage, etc. 
    (Anyone who wants higher octane for higher performance vehicles can buy cans of octane-booster additives.)

NEXT: Innovation & Action (mid-to-long term)
    --Nuclear proven alternative source, with least risks)  Federally mandated storage sites to be built NOW in 3 US states/areas: 
    West: Nevada: South: Texas: North:  Wyoming/Montana/Dakotas based on geographical and geological analysis.
    --Solar (largest source, usable in certain environments, with simpler--mirror based--plants)
    --Hydroelectric and Tidal (using gravity)
    --Geothermal (selectively usable at premium installation cost)
    --Wind (Selectively usable for certain locations)
    --Renewable (Cellulosic ethanol, re-growable raw material, etc.)
    --Clean Coal (Only when the best alternative for a location, cost, speed, etc.)
    --Assign Federal funding for mandated bike paths to be added parallel to any highway on which construction/repair work is being done, and connected to form a pedestrian, cyclist pathway to all major office and shopping centers from major residential and transportation centers.

What follows is part of an email I received from a correspondent.  I have modified it to shorten it, and changed a little wording.  I am putting it here because it so dramatically illustrates the foolishness that pervades American policy.  Read it and weep.  I did.  Then send it to your Congressman, your Senators, and anyone else you know in a position of influence.  It is all we can do.

Hoping that America's Independence is not lost in the coming decade, I remain your humble scribe,
John
---------------------------------------
Special Section on ANWR
DRILLING ANWR PER SE, ISN'T THE ISSUE--BUT IT REVEALS A LOT ABOUT THE DECEPTION GOING ON--AND IT IS SYMBOLIC OF THE RESISTANCE TO 'DOING ANYTHING!"

Drilling in ANWR won't solve America's energy dependence on OPEC and radical leaders like Chavez (Venezuela) or Ahmadinejad (Iran).  But it might very well dampen the impact of speculators, driving the price of oil up unrealistically.   Plus, the more foreign oil we buy, the more money we send them to use for their radical intentions--against the USA.  If you know all about ANWR, stop reading and delete this.  But if you don't, read the words and look at the pictures.

FIRST… do you know what ANWR is?
ANWR = Arctic National Wildlife Refuge.
 
Now, some pictorial comparisons and information about ANWR and oil drilling.
 

 

And some perspective…

 

NOTE WHERE THE PROPOSED DEVELOPMENT AREA IS…
(it's in the 'ANWR Coastal Plain')

THIS IS WHAT THE DEMOCRATS, LIBERALS AND 'GREENS' SHOW YOU WHEN THEY TALK ABOUT ANWR
…and they are right… these ARE photographs of parts of ANWR

ISN'T ANWR BEAUTIFUL?
WHY SHOULD WE DRILL HERE (AND DESTROY) THIS BEAUTIFUL PLACE
WELL… THAT'S NOT EXACTLY THE TRUTH ABOUT WHERE THE DRILLING WILL BE.

Do you remember the map?  The map showed that the proposed drilling area is in the ANWR Coastal Plain
Do those photographs look like a coastal plain to you?

WHAT'S WRONG WITH THIS PICTURE?
???????
THE ANSWER IS SIMPLE…

THAT IS NOT WHERE ANYONE WANTS TO DRILL!

THIS IS WHAT THE PROPOSED EXPLORATION AREA ACTUALLY LOOKS LIKE

IN THE WINTER

 

 IN THE SUMMER

AS YOU CAN SEE, THE AREA WHERE WE ARE TALKING ABOUT DRILLING IS VERY TINY PART OF WHAT IS A BARREN WASTELAND.

OH… AND THE CONCERN ABOUT THE EFFECT ON THE LOCAL WILDLIFE…

 HERE IS A PHOTO (SHOT DURING THE SUMMER) OF THE 'DEPLETED WILDLIFE' SITUATION CREATED BY DRILLING AROUND PRUDHOE BAY*…

DO YOU THINK THAT THE CARIBOU REALLY OBJECT TO THE DRILLING?
*NOTE: The Prudhoe bay area accounts for 17% of U.S. domestic oil production

NOW, WHY ARE THE POLITICIANS WHO ARE BLOCKING THE DRILLING, DISTORTING THE TRUTH ABOUT ANWR?

MOST LIKELY TO FURTHER THEIR OWN AGENDAS, OR TO RESPOND TO EXTREME SPECIAL INTERESTS—VOCAL ENVIRONMENTALISTS

(Maybe they'd like to go LIVE in ANWR if it's so wonderful.)

INSTEAD OF SOLVING AMERICA'S PROBLEMS, OUR OBSTRUCTIONIST LEADERS ARE MAKING THEM WORSE. 

NOW THAT YOU KNOW,
WHAT ARE YOU GOING TO DO ABOUT IT?

ASK YOUR POLITICIANS IF THEY FAVOR DRILLING IN ANWR AND LISTEN FOR ANY LIES, THE DISTORTIONS AND/OR EXCUSES?  WATCH THEM SQUIRM OUT OF PAST ENERGY POLICY POSITIONS, TOO.  

AND IF, (OR WHEN), THEY GIVE THE WRONG ANSWER, VOTE THEM OUT OF OFFICE OR DON'T VOTE THEM BACK INTO OFFICE. 

YOU CAN HELP BY SENDING THIS TO EVERYONE YOU KNOW…
SO THAT THEY WILL SEE THE TRUTH AND THE DISTORTIONS

AND TOGETHER, WE CAN MAKE INDEPENDENCE DAY STAND FOR ANOTHER KIND OF INDEPENDENCE—FROM ENEMIES OF THE USA FOR OUR ENERGY NEEDS.

THE ENTERPRISE--Summer variety

THE ENTERPRISE

PUBLICITY FOR THE COMPLEXITY CRISIS
My interview with Nan Russell on "Work Matters" is currently being aired.  You can listen to it here: http://www.webtalkradio.net/content/view/58/30/
Click on "Play Now" for this current week's program.  You can use the "Podcast" button to access and download the audio file. (You will need Version 7 or higher of Internet Explorer for the Podcast download to work.)

CORRECTION: ADVANCE NOTICE TO READERS OF THE ENTERPRISE: Missed one of the Entries!  SKUs!
I am building a subscription-based database of "Complexity Factor" (CF) calculations for companies that choose to participate.  I will be offering special advance deals to my regular contacts—to submit data from their companies--either owned or operated--and then share in the results.  Company-specific information will be kept absolutely confidential, and only merged with other data to yield benchmarkable averages and ranges of "CF" data to see where they stand.  If you or some of your contacts, clients or companies want to get in early, here is the information that will be requested:
Annual Sales Revenue (for the past year, specify the currency)
SKUs (Finished Goods Stock-Keeping-Units or their equivalent in non-product industries.)
No. of Customers (any active, with business transacted in the past year)
No. of Suppliers (all, not just inventory items)
No. of Employees (include temps and contract employees and part timers as Full Time Equivalents)
No. of Markets (served markets like OEM, consumer, contract, etc. not geographical)
No. of Legal Entities (especially those that exist in foreign countries)
No. of Locations (with meaningful facilities--which requires your interpretation)
Once I am ready, I will devote an entire issue of THE ENTERPRISE to the start-up. I have more than a dozen entries already, so if you are working for, or involved with a company that wants to participate, EMAIL me the data noted above.  it will be kept confidential and only disclosed after aggregation with  many companies data.

Also attached is the "lost attachment" from last week.

Download tell_me_today.doc

ENERGY ANSWERS:  USE LESS; FIND MORE; FIND DIFFERENT KINDS—CONCURRENTLY
If the political demagoguery would stop, even a moderately intelligent elected official (there are some of those, I think) should see the obvious.  Three approaches are required.  No one of them is sufficient to all the needs.  Why can't our governmental leaders see this?  Or can they, but it doesn't serve their political agendas to admit and act on it.

Exploration/Expansion of Oil  (short & mid-term)
    ANWR Drilling (mid-term)
    Offshore Drilling & Usage of Current Lease Rights (short term)
    Shale oil Development (mid-term)
    Refinery Construction & Expansion of Existing Capacity (short and mid-term)

Conservation (short, mid, & long term)
    Fuel efficient vehicles, homes, offices, factories, stores and cities, (street lights on highways where not needed, flood lights on signs, etc) etc.—NOW
    Reduce usage on transportation, unnecessary lighting (Christmas lights), excessive cooling & heating, etc. —NOW  and Future
    Use more fuel efficient products and practices (high mileage cars, programmable thermostats, CFLs, etc) —NOW and Future--more of them...
    Timers to turn off lights in unoccupied offices, public places, and ultimately in homes (provide tax incentives to install them)

Innovation (mid-long term)
    Nuclear (most certain, proven alternative source, with least risks)
    Solar (largest source, usable in certain environments, with simpler--mirror based--plants)
    Hydroelectric and Tidal (using gravity)
    Geothermal (selectively usable at premium installation cost)
    Wind (Selectively usable for certain locations)
    Renewable (Cellulosic ethanol, re-growable raw material, etc.)
    Clean Coal (Only when the best alternative for a location, cost, speed, etc.)

----------

BULLISH PREDICTIONS (although John Mauldin is usually more "bullish" than average, or at least more cautious.)----------

    "We appear to be entering a period of serious stagflation with sharply rising expected and actual inflation combined with large downside risks to growth and employment."

    "I would argue that what we are seeing is an acceleration of expected consumer price inflation in the context of a sharp expansion in global liquidity. It is hardly surprising that the prices of those commodities, such as oil, for which the short-run price elasticities of supply and demand are low move upwards strongly when there is a rise in expected general inflation. The oil market is a very convenient vehicle to speculate on expectations of higher levels of general price inflation. Hence my view is that the 40% jump in oil prices that has occurred over the past few months - roughly the period during which financial conditions have been loosened sharply - is a reflection of the expectation of either an acceleration of global inflation, or a depreciation of the US dollar, or some combination of the two."

    —Malcolm D Knight, General Manager, Bank for International Settlements

    The quote at the beginning of this letter is from the managing director of the Bank of International Settlements, or the central banker to the central bankers of the world. (Thanks to Simon Hunt for the quote.)

    Stagflation is a strong word to use, but Knight is surveying a world that is increasingly looking like it is in trouble. A Morgan Stanley study suggests that 50 countries around the globe have inflation running at 10% or more, and that this represents over 3 billion people.

    Almost all of those countries have negative real interest rates, or interest rates that are below inflation (as here in the US). Central bankers around the world are slowly raising rates and tapping on the brakes, but they are going to be under increasing pressure to do so. Thus, Knight suggests that global growth is due to slow down even as inflation is rising.

    —John Mauldin, Investor's Insight

AN OBAMA PRESIDENCY AND A DEMOCRATIC CONGRESS WOULD LIKELY EXACERBATE THESE ISSUES

Increase taxes don't help in tough economic times—they hurt. History has proven that government intervention (meddling) in free enterprise and trade don't help—it hurts.  Bush's policies and behavior didn't help these issues—he hurt them—as did his GOP allies in Congress.  Is John McCain the next version of Bush?  I don't think so.  This is an argument I have regularly with those who do think so.   McCain was almost the "anti-Bush" and that's why he is not so favored by traditional, further right conservatives.  In 2000 he was definitively the Anti-Bush, until he was done in by campaign dirty tricks and unfounded rumors in South Carolina.  He is a rebel.  McCain is a change agent—whether you like his  positions or not.  After the mainstream media gets done deifying and crowning Obama, it would be wise to look more closely at him, his policies and what he has done for his entire life.  It's easy to be someone you're not in a short political campaign.  Looking at the candidate's entire life, experiences, behaviors and positions is a much better picture of what he will be like in office.

Bottom line:  You can become arrogant and elitist even if you come from modest beginnings.  Examples:Entertainers (like Rosie O'Donnell to name just one).  many professional athletes, (and Michele Obama, too).

This year should be an unusual one, with the "Obamacons" (former Neocons/GOPers now for Obama) and the Blue Dog Democrats (these used to be called moderates and might have been either Republicans or Democrats) voting their principles instead of aligning with the liberal left.  Perhaps these two groups more accurately represent Americans than either party's extreme wings.  One time, a long time ago, I said I'd even vote for a McCain-Lieberman ticket.  Now I'm betting on Bobby Jindal of Louisiana as a strong VP candidate for McCain.  Obama's pick is more of a question, but I'd lean toward Bill Richardson of McCain's home state.  Both guys have "chops" that the candidates need.  Jindal is young, non-Caucasian, a strong speaker and a conservative. Richardson is an older,  seasoned government-veteran, with a broad range of experience (incl. foreign policy), and should appeal to Hispanics too.  Anybody got better choices?

ANSWERING AN OFT ASKED QUESTION ABOUT COMPLEXITY

I am often asked if getting rid of and managing complexity is the "whole answer."  Absolutely not.  Getting right of complexity is the first part of the solution.  Removing the excess, and redirecting the resources--talent/people and money that were being wasted on complexity into "true innovation" is the second part of the answer.  Growth—sustainable and profitable growth—is necessary for companies to survive and prosper.  Proliferation (and the attendant complexity it adds) is the wrong way to get that growth.  Innovation in either incremental (bagged lettuce) or "leap" (FedEX, Swiffer) is the key to long term success.  There's no faking innovation.  Creativity is not innovation.  It's just one of the steps in innovation.  I'll write more on this topic as the summer progresses.  Until then, get out there and look for unmet needs, under-served requirements.  Those are the ones that pay off. And, managing complexity wisely can create value through managed variety.  After all, the purpose of a business is to create and keep a customer, and to consistently deliver the best value to that customer.  Complexity is just a big pothole in the road to doing that/

Best, John

THE ENTERPRISE--PRIORITIES

THE ENTERPRISE

ADVANCE NOTICE TO READERS OF THE ENTERPRISE:
I am in the early stages of building a subscription-based database of "Complexity Factor" (CF) calculations for companies that choose to participate.  I will be offering special advance deals to my regular contacts to submit data from their companies--either owned or operated--and then share in the results.  Company-specific information will be kept absolutely confidential, and only merged with other data to yield benchmarkable averages and ranges of "CF" data to see where they stand.  If you or some of your contacts, clients or companies want to get in early, here is the information that will be requested:
Annual Sales Revenue (for the past year, specify the currency)
No. of Customers (any active, with business transacted in the past year)
No. of Suppliers (all, not just inventory items)
No. of Employees (include temps and contract employees and part timers as Full Time Equivalents)
No. of Markets (served markets like OEM, consumer, contract, etc. not geographical)
No. of Legal Entities (especially those that exist in foreign countries)
No. of Locations (with meaningful facilities--which requires your interpretation)
Once I am ready, I will devote an entire issue of THE ENTERPRISE to the start-up.  STAY TUNED.

PRIORITIES--THE LEADER'S TOUGHEST TASK
In these days of more complex global business environments, and more pressure packed schedules, the two toughest things a leader must do are set priorities and decide what NOT to do.  Many executives don't even realize that before they make a single commitment, their calendar is as much as 30-40% full of set events, prescheduled meetings and "must-attend" functions.  I have recommended that executives take a full year's calendar and put in all those "known" time commitments.  Then, if they are bold enough to plan vacations ahead of time, drop those in.  When they do, they see that they're starting the year with much less discretionary time than they think.  The bigger and more widespread the company, the worse the problem.  And yet, if the leaders don't set priorities, the minutiae fills up their schedules, and the people who rely on them to make the tough decisions, are left fending for themselves.  This is why complexity is such a punishing problem. It consumes that precious time voraciously.  Then, if the priorities go untended, so do the problems and the opportunities.

GOVERNMENT OFFICIALS SET PRIORITIES?  ARE YOU KIDDING ME?
What are the largest issues facing our country today?
--Iraq & Iran, Militant Islam, the "Axis of Evil" and our National Defense, re: Terrorism
--Energy--or the lack thereof--conservation, exploration and alternative energy sources.
--The Economy, near recession, inflation, housing and financial crises, jobs.
--Entitlements that cannot be funded--Medicare and Social Security
--The Health Care system and an aging population
--Illegal Immigration and the INS System, port security failings
--Financials, Taxes, the Tax system, the "sub-prime debacle," the Budget Deficit and balance of trade.
--Educational system failings, retraining the unemployed, drop outs, etc.
--Our failing infrastructure--roads, airlines, an obsolete Air Traffic Control System, etc.
--Our "broken system of government" crippled by gridlock, partisan sniping, special interests, lobbyists and earmarking (waste).
--Food and water problems--national and global
There are more, but I'll stop with those.  NOW, what in the hell are the priorities of our Congressional leaders?  Certainly not fixing the most serious problems we face today. They are wasting precious time and effort playing "gotcha games," questioning former Press Secretary McClellan about the Valerie Plame (non-legal) case?  They are worried about steroids in baseball and Arlen Spector (R., PA) is wasting his time and our money investigating the New England Patriots video-cheating contention?  John Murtha, laying military demagogue while piling up record earmarks for his district in PA--and bragging about it.  People like Chris Dodd taking favorable loans from Countrywide? ARE YOU KIDDING ME.  These people don't deserve to be re-elected--but many of them will be. GET USED TO IT.  Incumbents who remain "crime and scandal-free" have a huge reelection rate.

DO SOMETHING DIFFERENT
Maybe Congress needs to quit blaming everything bad that happens on George Bush, since it seems they have some problems of its own.  And as far as Barack Obama's wife being "off limits," why is she appearing on THE VIEW if she wants to stay out of the limelight?     Or does she just want to stay out of any negative limelight. And John McCain needs to "tune up" some of his advisors, and a new (shorter) podium to travel with him, so he doesn't look hidden behind it.  McCain also needs more twenty-somethings who are Web 2.0/Social Network/Blog/etc. conversant to start spreading his word.  Obama's lead in that media is HUGE! And why is anyone surprised that he'd flip-flop on taking "public money" for the campaign when he is swimming in money and can probably outspend McCain 2:1 between now and Nov.  Obama and Tiger Woods have more than a few things in common. Even when they aren't at their best, they still look good--and usually win (even when I am pulling for the older, underdog).  The good thing about McCain's and Obama's relatively frequent policy position changes is that as conditions change, so should the plans to deal with them. 

FACTOID (Read, unverified)
Every $1 in oil price adds 1% to the cost of goods from China. Put that in your pricing pipe and smoke it.  And one of the largest shortages today:  ocean freight containers in the USA to send stuff (lumber, pulp, grain, etc.) to Asia--YES--THAT'S RIGHT--to Asia.  New production locations for the next few years: the Southern USA where hard working, non-Union labor can use modern technology to take back some US jobs.

I DON'T LIKE EITHER OF THE CANDIDATES HEALTH CARE PLANS VERY MUCH
(Of course I'm on Medicare plus a supplemental paln--but even those will cost me more in the future.)
Obama's is a tax & spend plan.  It needs some work.  McCain's is so "free-market-based" that only knowledgeable people can understand how it works, and some of them can't see why it's that much better than what we have.  He needs to tweak it somehow.  (If I knew how, I'd say-- but I don't.)  McCain's best plans are those where you can choose simpler Tax plans--and maybe a simpler Health Care plan?  I'll say it again: I like Obama's inspiring rhetoric (if only he would govern like he talks), and God knows we need change,  but I want McCain's courageous, experienced leadership in the White House when the chips are down.

WHAT 47 MILLION UNINSURED?   
Then there's the headline issue: But who are the 47 million uninsured? The answers may surprise you.
--70% of the uninsured are in families with at least one full-time worker.
--10% have at least one part-time worker. The rest are retired or unemployed.
--8.4 million are eligible for government programs but don’t know they are, don’t know how to sign up or don’t have access to the documents that are required.
--10.2 million are noncitizens. About 80% of them are legal residents, but many have low-income jobs and can’t afford or don’t have access to insurance.
--9.2 million have household incomes of $75,000 or higher. Some are healthy and don’t want coverage. Others can’t get it because of preexisting conditions.
--7.5 million are aged 19-24 and either have no access to health care, lack money to pay for it or don’t think they need it because they are in good health.

Thus, it isn't quite the kind of debacle that the 47 MILLION UNINSURED media splash makes it out to be.  A lot of them don't want insurance--therein the rub about mandated insurance during the Democratic primary arguments between Hillary and Barack.  Some don't deserve insurance, but without it, they'll be subsidized by those who do have insurance.  Whatever plan is devised by whoever the next President and Congress are, it's clear that the plan will be heavily influenced by the Democratic power in Congress.  I hope they do something intelligent.

LAST BUT NOT LEAST--SOMETHING PERSONAL TO READ AND HEED:
This was written by the pastor (an Irishman by birth) of a Catholic parish in MS that got wiped out by Hurricane Katrina.  It's simply wonderful.

 

AND THAT, MY FRIENDS AND READERS, SAYS IT ALL.

Best,
John

THE ENTERPRISE--DENIAL

THE ENTERPRISE--DENIAL

SCENARIOS FOR MANAGEMENT

One of the most challenging jobs of management, and especially of senior management led by the CEO is to decide what to do in the face of a constantly changing tableau of the competitive environment.  Developing "scenarios" that might unfold is a management technique that can be very useful.  While there are sophisticated scenario analysis methods, some simpler ones work well in a macro sense.  To do this, it is necessary to carefully construct the current environment in a coldly accurate assessment.  A common flaw in such decision processes is denial.  Denial is insidious.  It undermines the validity of assessments, plans and strategies because it is sets a flawed baseline.  The challenge, then, for successful managers and executives is to overcome the natural human tendency toward denial or harsh realities by forcing a clear understanding of what's happening, and what's likely to happen in the world in which they compete.

COMPLEXITY DEPENDS ON DENIAL TO EXIST

I don't intend this issue of THE ENTERPRISE to be all about complexity.  I do want to point out that complexity comes about with the best of intentions--the quest for growth at faster than the underlying markets.  It grows unchecked because accounting systems fail to capture it in a way that makes it evident as to cause and effect.  Finally, when the bottom line results are disappointing because complexity has eroded them, denial sets in, followed shortly thereafter by excuses and blame games.  Government is no different.  Denial is convenient.  It is cooperative because it is malleable, and can be shaped to fit almost any situation.  Take the current political candidates.  Both are practicing denial is one form or another.  Obama's denial is that his plans are affordable, and that his history of being shaped by Chicago politics and his church are not relevant.  Both assumptions are wrong.  McCain's denial is in the flawed plans he still espouses as he tries to embrace the more conservative wing of his party—his health care plans are simply inadequate to the current needs.  His straddle position on areas like immigration is a form of denial.  When I lived out in OK, an old saying was "Cowboy who straddle fence, get sore crotch."  Both of these men must be chafing a bit by now.

SO WHAT NOW?  INFLATION, $150/BBL OIL, SLOW GROWTH, COSTLY ENTITLEMENTS PLUS AN EXPENSIVE WAR, ETC.  LEAD TO WHAT?

"We learn from history that we do not learn from history." (Georg Friedrich Wilhelm Hegel, a German philosopher)  Here is the scenario.  The US is engaged in a costly, unpopular and unsuccessful war; the Middle East is racked with turmoil; the US dollar is in free fall; commodity prices are surging; oil prices have increased dramatically; food prices are also soaring; and massive climate shocks have hit the USA.   A Republican President is battling historically low approval ratings.  Dick Cheney is close to the seat of power.  The country seems to be adrift.   THE TIME WAS THE FIRST HALF OF THE 1970s.THAT'S RIGHT--THE EARLY 1970s, WHICH SAW STAGFLATION, SLOW GROWTH, A STOCK MARKET GOING MOSTLY NOWHERE.

The Club of Rome published its Limits to Growth predicting that the world economy would overshoot the Earth's natural resources and collapse.  (Thomas Malthus had predicted this same collapse in the late-18th century, too.)  Unfortunately, each time history repeats itself; the "cure" gets tougher.  China is poisoning its environment and draining its aquifers to grow crops for its huge population.  Global warming--and natural weather-related disasters--whether a long-term catastrophe or a short-term cycle, is damaging crop production causing food shortages.  North Koreans are starving.  Europe is quickly becoming a Muslim outpost.  Israelis must deny Palestinians any democratic equality because the Palestinians outnumber the Israelis and would quickly dominate a democratic state if combined. 

Russians are literally dying out, with a birth rate so low that it will not be able to manage its vast geography in a generation, although it is feeling its "power" grow near term as the other European powers weaken and fade.  Iran is squandering its oil while investing in nuclear plants for power--or for weapons?  Vietnam takes work from China, but struggles with inflation in the 15-25% range, and devalued currency.  The USA, thanks to partisan politics is grid-locked into a leaderless mass of sheep, all trying to graze off the same pasture--the wealth producers--in order to feed and care for the indigents, who neither want to work, nor care where their support comes from.  The corporate world staggers through this turmoil, struggling to merge into success, but finding that putting together two or more inept companies yields just a larger inept company.

GOD KNOWS WE NEED CHANGE--BUT WHAT KIND OF CHANGE          

The Democratic candidate, Barack Obama eloquently cries out for change.  But his past, and his party show no ability to craft successful change.  Their plan is to take from those who create wealth (tax increases), and spend (or waste) the money on programs where they see the "needs."  Karl Marx, author of The Communist Manifesto, defined this method: "From each according to his ability, to each according to his needs!"  This is not the kind of change we need in the USA.  John McCain also wants change.  His idea of change is fiscal responsibility.  If he were elected President, he could wield the veto pen to stop spending that was not supported by revenues (an idea that seems to have escaped George W. Bush).  It seems what we need is Obama's inspiring style with McCain's down-to-earth experience and spending control.

In foreign policy the two differ widely--McCain pressing on to (we hope) victory in Iraq ("Victory" means sufficient stability, supported by the Iraqi people, government, and police, to allow a withdrawal of the substantial majority of US troops.  Neither candidate imagines total withdrawal.  Obama's plan is to start withdrawing immediately, regardless of the consequences.  Of course the fact that he has neither been to Iraq in recent years, nor talked to any military officials involved with the actual situation there casts doubt on how he arrived at his "plan."    The simple use of the word appeasement in a Bush speech touched off a defensive flinch by Obama--in the category of "if the shoe fits..." Finally,  IF the Democrats achieve a "veto-proof" majority in Congress (a real possibility), then even a McCain presidency could do little to stop the tax and spend methodology the Democrats have relied on for so long.  It only took Jimmy Carter one term as President to create chaos of high inflation, high unemployment and high interest rates--all at once. 

BUSINESS PLANS MUST CONTEMPLATE THESE SCENARIOS

The only thing a prudent businessperson can do is find ways to "diversify" from what could be a "toxic" business environment in the USA.  This is not without problems, and other places have different challenges.  Headquarters will move to friendlier, far away places like Dubai.  Investments will move to either developing countries in SE Asia (where the rule of law and high inflation present a different set of challenges) or to more business-friendly places in other parts of the world (Ireland? India? Where else?)  Production in the US may see a temporary resurgence if a protectionist administration controls the US government.  The weakness of the dollar and inflationary pressures in Less Developed Countries are already starting to make the USA one of the places to consider for production.  China's rapid growth and development combined with intrinsic high inflation (there and in other Asian countries) will make certain kinds of US production competitive again.  Examples are where technology and capital equipment supplants much of the labor, or where the size or nature of the product makes it impractical to import (HVAC equipment is one example.)  In other cases, the US has lost certain industries for a long, long time (consumer electronics, for one example).

THE ULTIMATE ISSUES:  ENERGY AND WATER--MOSTLY ENERGY

Since the Earth is 70% water, there should be plenty of water.  The problem is that most of it is salt water. But salt water can be desalinated with enough energy. There's the rub. "ENOUGH" ENERGY--and at what price?  Energy from oil will be insufficient unless a much more realistic stance is taken on exploration, drilling and other oil-based sources (oil shale), and conservation that has just begun in the US gains momentum.  Strangely, the most obvious solution is being almost entirely ignored (or submerged by special interest protests) in the USA.  Nuclear power.  It is less costly, cleaner, and sustainable for a long time.  The fears triggered by Chernobyl (a plant designed and run by irresponsible fools) and Three Mile Island are irrational, illogical and untenable.  The debate about what to do with nuclear waste is similarly foolish.  At some point, sensible adults have to take control of decisions.  It seems we are more willing to deal with the solid and gaseous emissions of coal-burning plants that the minute risk that cleaner nuclear plants will solve many of our energy problems.  Oh my, the critics cry, wringing their hands. 

What will we do with that dangerous nuclear waste?  Perhaps use a more sophisticated form of what we do with our excessive waste of garbage.  Dig a hole and bury it--but deeper and with better containment than just "dirt."  Millions of acres of the Western US, especially in Nevada are empty, barren and virtually uninhabitable by humans.  What better place to dispose of (meaning: store ad infinitum) nuclear waste.  Yet special interests block such efforts.  France uses predominantly nuclear power (75%).  China has a couple of dozen reactors under construction.  We have become a country so preoccupied with the bleeding hearts and extreme special interests, political correctness militia that we are endangering all of the people because of our sensitivity to this impractical and zealous minority.  But wait—that's Harry Reid's state, and of all the misguided people in positions of power, he must rank in the top 2-3.  So stop everything and suffer.

The Western deserts of the US (and other deserts in Africa, Australia, and China) offer natural environment for solar power generation.  The false solution of "electric cars" seems to overlook that the electricity to recharge them has to be generated from some kind of fuel.    Offshore drilling is acceptable in most parts of the world, but somehow the US is "holier than thou."    When will the "inmates who hold the institution hostage" release their grip?  Will it be soon enough?  I fear not.  Businesses must find their own alternative energy sources, and not rely on government to solve this problem.  If that means moving to where the energy can be generated (solar, wind, hydro-electric, tidal, geothermal?)  If we can land people on the moon and robots on Mars, we might, just might be able to figure this out if a minority of Americans would stop being obstinate and DO SOMETHING.  (Check how the votes on off-shore drilling go:   Democrats unanimously against it; Republicans unanimously for it.)  The accusation:  the GOP just wants to enrich big oil.  WHAT CRAP!

IT'S ODD HOW THE PEOPLE WE CHOOSE TO SERVE US, ACTUALLY WORK AGAINST US (AND FOR PERSONAL POWER OR GAIN)

ANOTHER BUSINESS PERSON'S TAKE ON THINGS

Personal Observation on America’s Problems

By Doug Allston, President, Advantage Consulting, Inc.

I got a really great email the other day titled Non-Partisan Sentiment. I don’t even remember who sent it to me.  I did a little research and found that Charley Reese wrote the original text.   I have been following the oil issue very closely and wondering why we can’t get out of our own way.  We can’t drill for oil off most of our coastlines.  We can’t drill for oil in Alaska.  The Senate Appropriations Committee just killed the shale oil drilling bill.  The US is literally the only country in the world with energy resources that has been systematically closing access to those resources.  The Senate’s action made the following make a lot of sense. 

“Politicians are the only people in the world who create problems and then campaign against them.  Have you ever wondered why, if both the Democrats and the Republicans are against deficits, we have deficits?  Have you ever wondered why, if all the politicians are against inflation and high taxes, we have inflation and high taxes?  You and I don't propose a federal budget. The president does.  You and I don't have the Constitutional authority to vote on appropriations. The House of Representatives does.  You and I don't write the tax code, Congress does. You and I don't set fiscal policy, Congress does.  You and I don't control monetary policy, The Federal Reserve Bank does.

One hundred senators, 435 congressmen, one president and nine Supreme Court justices - 545 human beings out of the 300 million - are directly, legally, morally and individually responsible for the domestic problems that plague this country.  Those 545 human beings spend much of their energy convincing you that what they did is not their fault. They cooperate in this common regardless of party.

What separates a politician from a normal human being is an excessive amount of gall.  No normal human being would have the gall of a Speaker, who stood up and criticized the President for creating deficits. The President can only propose a budget.  He cannot force the Congress to accept it.  The Constitution, which is the supreme law of the land, gives sole responsibility to the House of Representatives for originating and approving appropriations and taxes.  Who is the speaker of the House? She is the leader of the majority party. She and fellow House members, not the president, can approve any budget they want. If the president vetoes it, they can pass it over his veto if they agree to.  It seems inconceivable to me that a nation of 300 million cannot replace 545 people who stand convicted -- by present facts - of incompetence and irresponsibility.

I can't think of a single domestic problem that is not traceable directly to those 545 people.  When you fully grasp the plain truth that 545 people exercise the power of the federal government, then it must follow that what exists is what they want to exist.  If the tax code is unfair, it's because they want it unfair. If the budget is in the red, it's because they want it in the red. If the Marines are in IRAQ, it's because they want them in IRAQ.  If they do not receive social security but are on an elite retirement plan not available to the people, it's because they want it that way. There are no insoluble government problems. Do not let these 545 people shift the blame to bureaucrats, whom they hire and whose jobs they can abolish; to lobbyists, whose gifts and advice they can reject; to regulators, to whom they give the power to regulate and from whom they can take this power.  Above all, do not let them con you into the belief that there exist disembodied mystical forces like 'the economy’, 'inflation' or 'politics' that prevent them from doing what they take an oath to do.

Those 545 people are responsible. They have the power. They should be held accountable by the people who are their bosses - provided the voters have the gumption to manage their own employees.  These 545 people have created many of the problems this country faces.  However, it is also true that we, the citizens of this country, reelect approximately 90% of the 545 every election.  Therefore, we bear a great deal of the responsibility for the mess we have created.“

Maybe it is time we take a little advice that is over 2,000 years old.  "The budget should be balanced, the Treasury should be refilled, public debt should be reduced, the arrogance of officialdom should be tempered and controlled, and the assistance to foreign lands should be curtailed lest Rome become bankrupt. People must again learn to work, instead of living on public assistance." —Marcus Tullius Cicero

Or as Pogo once observed, "We Have Met The Enemy and He Is Us" – Walt Kelly 1970.

LET'S GO BACK THE BUSINESS PRINCIPLES--SCENARIOS

Any business that hopes to compete during the next 5-10 years has to make a plan that assumes energy will be scarce, expensive and available in limited supplies as determined by people who neither understand, nor care about the wealth and health of our country or its businesses.  Since businesses are social institutions created by people to improve how wealth-creating activities can be best organize, that means we are facing perhaps a decade of ANTI-BUSINESS policies from our government.  Assume that inflation will be a problem.  Assume that government intervention of all types will be a problem.   Assume that the ability to accurately forecast dynamic global geopolitical outcomes will be poor.  Stay nimble. Stay smart.  Have Plan B & C ready if Plan A gets derailed.  Use every bit of information and intellect at your disposal to make the best and most flexible possible decisions.

FOREWARNED IS FOREARMED

With thse as the dominant guideposts, astute business people will develop alternative plans.  The smartest and most competitive ones will find new ways to achieve their goals, in spite of oppressive government, and restrictive, expensive, and scarce availability of basic needs.  They will make the best possible use of every alternative at their disposal. Innovation is a combination of creativity and ingenuity—of imagination and technology applied through the efforts of smart, talented and determined people.  Innovation doesn't just address new products.  (One example: In the 1970's when corrugated cardboard was on shortage-based allocation, we found and entirely an new way to replace "6 and 12 pack master shipping cartons"--using corrugated trays and strapping.  This protected the individual boxed product, allowed labels and address marking, stacking, palletizing, etc. and used about 40% less corrugated--and the cost was about the same.)

Watch as the campaigns and elections move closer to conclusion.  If I am wrong (which happens from time to time), it will be easier to adapt to that eventuality than the one these scenarios seem to indicate. 

Now you know.   Plan now.  Start setting actions in motion.  To wait—will be too late.  Don't wait for $50/bbl oil or $2/gal. gasoline--you might be waiting a very long time.

Best, John

PS:  Did you ever hear of a Post Turtle?

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THE POST TURTLE          

While suturing a cut on the hand of a 75-year old Texas rancher whose hand was caught in a gate while working cattle, the doctor struck up a conversation with the old man.  Eventually the topic got around to Obama and his bid to be our President.

            The old rancher said, “Well, ya know, Obama is a post turtle.”

            Not being familiar with the term, the doctor asked him what a ‘post turtle' was.

            The old rancher said, “When you're driving down a country road and you come across a fence post with a turtle balanced on top, that's a post turtle.”

            The old rancher saw a puzzled look on the doctor's face, so he continued to explain.

            “You know he didn't get up there by himself, he doesn't belong up there, he doesn't know what to do while he is up there, and you just wonder what kind of dumb asses put him up there to begin with.”

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"There will come a time when you believe everything is finished. That will be the beginning."  —Louis L'Amour

THE ENTERPRISE—"BEWITCHED, BOTHERED AND BEWILDERED"

THE ENTERPRISE—"BEWITCHED, BOTHERED AND BEWILDERED"

"BEWITCHED, BOTHERED AND BEWILDERED"
This was the name of a decades old popular song.  It pretty well sums up how most rational thinkers feel about the probably Democratic candidate for President, Barack Obama.  This week's lengthy edition of THE ENTERPRISE will present the views of several intelligent, thoughtful people who share this viewpoint.

PLEASE PASS THIS ON... to everyone you correspond with via email...
Amidst all the media exuberance over Barack Obama "winning" the Democratic nomination for President, there are some aspects of Obama that have been overlooked and/or given far too little attention by the mainstream media.  

My content this week consists mostly of 4 articles, three of them by distinguished men of Obama's own race--part of the 10% or so that aren't entranced by him. 
If you will read these and pass this email on (like a chain letter), we can probably raise awareness of how the man and the image just don't match.

A recent WSJ article by Juan Williams, yet another person of Obama's own (minority) race stated a few important points too.  In summary they pointed out that Obama's words and behaviors don't match.  First Rev. Wright was his spiritual mentor--but then, he as like an uncle to him, a member of an angry older generation.  In 20 years of attending his church Obama never heard any of this kind of rhetoric.  WHAT?  Why go to church if you don't hear anything?  What gives here?

And Obama's bi-partisan conciliatory campaign rhetoric flies completely in the face of a voting record in his short time as a US Senator that is the MOST LIBERAL in the Senate--to the left of John Kerry, Ted Kennedy, et. al.  And surely the fact that Tony Rezko, a Chicago "businessman" paid twice market value for the lot next to the house Obama's wanted to buy, had nothing to do with Obama's ability to pay below market value for the house.  Of course not.

Kimberly Strassel writing for the WSJ's Potomac Watch says it well:  "We've learned that the Obama campaign's main message still has no clothes.  The senator has had nearly a year-and-a-half to explain how his new brand of politics and bipartisanship would work; the optimists among us are still waiting."

BUT THESE FACTS DON'T MATTER UNLESS OR UNTIL SOMEONE CAN BREAK OBAMA'S MAGIC SPELL ON THE YOUTH WHO ADMIRE THIS NEW POLITICAL "ROCK STAR" CANDIDATE & HIS ELITIST WIFE.

READ ON...
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Not So Fast, Barack
 
By INVESTOR'S BUSINESS DAILY | Posted Tuesday, June 03, 2008 4:20 PM PT
 
Decision '08: Barack Obama is changing churches in hopes of changing the subject long enough to slip into the White House. But it won't change what he believes. Who'll pin him down?

A careful reading of the transcript of Obama's press conference over the weekend reveals that he neither denounced his church nor permanently quit it. He twice left open the door to rejoining Trinity United Church of Christ after the election.  He said he and his wife merely decided "it was going to be very difficult to continue our membership there so long as I was running for president."
 
Typical of the coverage of this candidate, nobody in the press followed up with tough questions. Nobody bothered to parse his words.  They just lobbed more softballs. "Do you feel like your faith and your church come under fire, more rapid fire, than other candidates in this presidential election?" asked one reporter. "How do you feel about that?"
 
We already know how Obama feels. He's frosted that this paper and others outside the mainstream liberal media exposed his militantly Afro-centric, anti-American church and preacher.  "I didn't anticipate my fairly conventional Christian faith being subjected to such challenge," he said, with a straight face. So now he hopes quitting the church will put the controversy behind him.  "We don't want to have to answer for everything that's stated in a church," Obama complained. "We also don't want a church subjected to the scrutiny that a presidential campaign legitimately undergoes."
 
In other words, don't ask any more questions. The media seem content to honor his wishes, repeating the professional malpractice they committed in 1992 with another of their favorites, Bill Clinton.  But there's nothing "conventional" about Obama's church. It adheres to a radical doctrine that marries black nationalism with Christianity and believes white America is the centrum of evil in the world. It not only deserves further scrutiny, it screams for it.
 
Voters deserve to see specifically where there is and isn't alignment between a church doctrine that preaches hatred of America and a candidate who wants to "change" America.  Black militant James Cone is the father of this doctrine, known as "black liberation theology." Obama's preacher and mentor, the Rev. Jeremiah Wright, has said, "I do not in any way disagree with James Cone," now a professor in New York.  Obama's church uses Cone's 1969 book, "Black Theology and Black Power," as a second Bible. Wright keeps asking his critics if they've ever read Cone's books. The real question is whether Obama has ever read them.

Nobody has asked him. 
Or whether he's taught Sunday school classes on Cone's theology. Never asked, never answered.  Cone believes Jesus Christ was black, that blacks are the true chosen people and that Africa is the Promised Land. Does Obama share these unconventional views?  Cone also believes that the white man is the "devil" and the white church in America the "anti-Christ." Does Obama hold these views, as well?  Both Wright and Cone have argued for reparations for blacks. Where does Obama stand on this issue? We don't know. He's not talking.
 
Obama, a lawyer, is very clever about crafting his denials. He claims he never heard Wright's splenetic sermons while sitting in "the pews."  What about in the church's two overflow rooms in the bowels of the building, where latecomers sit on folding chairs and watch a TV broadcast of the service? Did he ever hear his sermons via streaming Internet broadcasts or via the DVDs sold at the church gift shop? We don't know.

Nobody has asked him. 
Cone's protege is Dwight Hopkins, who teaches black theology classes at Obama's church that include harangues against "U.S. capitalism's oppressive character." Did Obama ever hear Hopkins speak? Did he ever take a class taught by him?  What about all the kooky conspiracy theories Obama's preachers and "fellow Trinitarians" believe? Does Obama, too, buy that the U.S. government cooked up AIDS and crack to destroy blacks?  These are just a few of the questions left unasked by the media and unanswered by the presumptive Democratic nominee for president.
 
The media failed to adequately vet Bill Clinton, and look what the electorate got. History is repeating itself now with Obama, and the country could end up with something far worse.

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Beyond The Rhetoric And Resignations
 
By THOMAS SOWELL | Posted Tuesday, June 03, 2008 4:30 PM PT
 
It is amazing how seriously the media are taking Sen. Barack Obama's latest statement about the latest racist rant from the pulpit of the church he has attended for 20 years.  But neither that statement nor the apology for his rant by Father Michael Pfleger really matters, one way or the other. Nor does Sen. Obama's belated resignation from that church.
 
For any politician, what matters is not his election-year rhetoric, or an election-year resignation from a church, but the track record of that politician in the years before the election.  Yet so many people are so fascinated by Obama's rhetorical skills that they don't care about his voting record in the U.S. Senate, in the Illinois state Senate, the causes that he has chosen to promote over the years, or the candidate's personal character and values, as revealed by his actions and associations.
 
Despite clever spin from Obama's supporters about avoiding "guilt by association," much more is involved than casual association with people like Jeremiah Wright and Father Pfleger.  In addition to giving $20,000 of his own money to Jeremiah Wright, as a state senator, Obama directed $225,000 of the Illinois taxpayers' money for programs run by Father Pfleger. In the U.S. Senate, Obama earmarked $100,000 in federal tax money for Father Pfleger's work.  Giving someone more than 300 grand is not just some tenuous, coincidental association.
 
Are Barack Obama's views shown by what he says during an election year or by what he has been doing for decades before?  The complete contrast between Obama's election-year image as a healer of divisions and his whole career of promoting far-left grievance politics, in association with America-haters like Jeremiah Wright and Bill Ayers, are brushed aside by his supporters, who talk about getting back to "the real issues."  There is nothing more real than a man's character and values. The track record of what he has actually done is far more real than anything he says, however elegantly he says it.
 
There is no office where the character and values of the person in that office matter more than the office of president of the United States. He holds the destiny of 300 million Americans in his hands and the fate of generations yet unborn.  That was never more true than today, with Iran moving ever closer to a nuclear bomb, while the United Nations wrings its hands and Congress fritters away its time on things from steroids in sports to earmarks for pet projects back home.
 
Does anyone seriously consider what it would mean for Iran to have nuclear weapons? They already are supplying terrorists with the means of killing people in other countries, including killing American troops in Iraq.  Sen. Obama has been downplaying the Iran threat, saying that they are just "a small country," not like the Soviet Union. The people who flew planes into the World Trade Center were an even smaller group than the Iranian government.
 
Half a dozen terrorists like that with nuclear weapons would be a bigger danger than the Soviet Union ever was, because the Soviet leaders were not suicide bombers. They could be deterred by the threat of what we would do to Moscow if they attacked New York. You cannot deter suicidal fanatics. They are not going to stop unless they get stopped. Rhetoric is not going to do it.
 
Not only Sen. Obama, but too many other Americans, seem to have no concept of the seething hatred that can lead people to destroy their own lives in order to lash out at others. But terrorists have been doing this repeatedly, not only in Iraq and in Israel, but in other countries around the world — including the United States on 9/11.  Have we already forgotten how the Palestinians were cheering in the streets over the news of the attack on the World Trade Center? How videotapes of sadistic beheadings of innocent people by terrorists have found an eager audience in the Middle East?
 
Are we going to leave our children hostages to hate-filled sadists with nuclear weapons? Are we to rely on Barack Obama's rhetoric to protect them?
 Sen. Obama's foreign policy seems to be somewhere between Rodney King's "Can't we just get along?" and Alfred E. Neuman's "What, me worry?"

FROM THE CANDIDATE WHO REFUSES TO GO TO IRAQ--WHY?  MIGHT HE LEARN THE TRUTH INSTEAD OF HIS PROCLAMATIONS?

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A Black Columnist on Obama
 
Ken Blackwell - Columnist for the New York Sun

It's an amazing time to be alive in America . We're in a year of firsts in this presidential election: the first viable woman candidate; the first viable African-American candidate; and, a candidate who is the first front-running freedom fighter over 70. The next president of America will be a first.

We won't truly be in an election of firsts, however, until we judge every candidate by where they stand. We won't arrive where we should be until we no longer talk about skin color or gender. Now that Barack Obama steps to the front of the Democratic field, we need to stop talking about his race, and start talking about his policies and his politics.

The reality is this: Though the Democrats will not have a nominee until August, unless Hillary Clinton drops out, Mr. Obama is now the front-runner, and its time America takes a closer and deeper look at him. Some pundits are calling him the next John F. Kennedy. He's not. He's the next George McGovern. And it's time people learned the facts.

Because the truth is that Mr. Obama is the single most liberal senator in the entire U.S. Senate. He is more liberal than Ted Kennedy, Bernie Sanders, or Mrs. Clinton.  Never in my life have I seen a presidential front-runner whose rhetoric is so far removed from his record. Walter Mondale promised to raise our taxes, and he lost. George McGovern promised military weakness, and he lost. Michael Dukakis promised a liberal domestic agenda, and he lost.

Yet Mr. Obama is promising all those things, and he's not behind in the polls. Why? Because the press has dealt with him as if he were in a beauty pageant.  Mr. Obama talks about getting past party, getting past red and blue, to lead the United States of America . But let's look at the more defined strokes of who he is underneath this superficial 'beauty.'

Start with national security, since the president's most important duties are as commander-in-chief. Over the summer, Mr. Obama talked about invading Pakistan, a nation armed with nuclear weapons; meeting without preconditions with Mahmoud Ahmadinejad, who vows to destroy Israel and create another Holocaust; and Kim Jong II, who is murdering and starving his people, but emphasized that the nuclear option was off the table against terrorists - something no president has ever taken off the table since we created nuclear weapons in the 1940s. Even Democrats who have worked in national security condemned all of those remarks. Mr. Obama is a foreign-policy novice who would put our national security at risk.

Next, consider economic policy. For all its faults, our health care system is the strongest in the world. And free trade agreements, created by Bill Clinton as well as President Bush, have made more goods more affordable so that even people of modest means can live a life that no one imagined a generation ago. Yet Mr. Obama promises to raise taxes on 'the rich.' How to fix Social Security? Raise taxes. How to fix Medicare? Raise taxes. Prescription drugs? Raise taxes. Free college? Raise taxes. Socialize medicine? Raise taxes. His solution to everything is to have government take it over. Big Brother on steroids, funded by your paycheck.

Finally, look at the social issues. Mr. Obama had the audacity to open a stadium rally by saying, 'All praise and glory to God!' but says that Christian leaders speaking for life and marriage have 'hijacked' - hijacked - Christianity. He is pro-partial birth abortion, and promises to appoint Supreme Court justices who will rule any restriction on it unconstitutional. He espouses the abortion views of Margaret Sanger, one of the early advocates of racial cleansing. His spiritual leaders endorse homosexual marriage, and he is moving in that direction. In Illinois , he refused to vote against an existing statewide ban on all handguns in the state. These are radical left, Hollywood , and San Francisco values, not Middle America values.

The real Mr. Obama is an easy target for the general election. Mrs. Clinton is a far tougher opponent. But Mr. Obama could win if people don't start looking behind his veneer and flowery speeches. His vision of 'bringing America together' means saying that those who disagree with his agenda for America are hijackers or warmongers. Uniting the country means adopting his liberal agenda and abandoning any conflicting beliefs.  

But right now everyone is talking about how eloquent of a speaker he is and - yes - they're talking about his race. Those should never be the factors on which we base our choice for president. Mr. Obama's radical agenda sets him far outside the American mainstream, to the left of Mrs. Clinton.

It's time to talk about the real Barack Obama. In an election of firsts, let's first make sure we elect the person who is qualified to be our president in a nuclear age during a global civilization war.

                            Ken Blackwell was Secretary of State of OHIO and a gubernatorial candidate in 2006.
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Only One Choice In Face Of Nuclear Terror

By THOMAS SOWELL | Posted Thursday, June 05, 2008 4:30 PM PT

Now that the two parties have finally selected their presidential candidates, it is time for a sober — if not grim — assessment of where we are.  Not since 1972 have we been presented with two such painfully inadequate candidates. When election day came that year, I could not bring myself to vote for either George McGovern or Richard Nixon. I stayed home.

This year, none of us has that luxury. While all sorts of gushing is going on in the media, and posturing is going on in politics, the biggest national sponsor of terrorism in the world — Iran — is moving step by step toward building a nuclear bomb. The point when they get that bomb will be the point of no return. Iran's nuclear bomb will be the terrorists' nuclear bomb — and they can make 9/11 look like child's play.

All the options that are on the table right now will be swept off the table forever. Our choices will be to give in to whatever the terrorists demand — however outrageous those demands might be — or to risk seeing American cities start disappearing in radioactive mushroom clouds.  All the things we are preoccupied with today, from the price of gasoline to health care to global warming, will suddenly no longer matter.

Just as the Nazis did not find it enough to simply kill people in their concentration camps, but had to humiliate and dehumanize them first, so we can expect terrorists with nuclear weapons to both humiliate us and force us to humiliate ourselves, before they finally start killing us.  They have already telegraphed their punches with their sadistic beheadings of innocent civilians, and with the popularity of videotapes of those beheadings in the Middle East.

Danger Ahead
They have already telegraphed their intention to dictate to us with such things as Osama bin Laden's threats to target those places in America that did not vote the way he prescribed in the 2004 elections. He could not back up those threats then, but he may be able to in a very few years.  The terrorists have given us as clear a picture of what they are all about as Adolf Hitler and the Nazis did during the 1930s — and our "leaders" and intelligentsia have ignored the warning signs as resolutely as the "leaders" and intelligentsia of the 1930s downplayed the dangers of Hitler.  We are much like people drifting down the Niagara River, oblivious to the waterfalls up ahead. Once we go over those falls, we cannot come back up again.

What does this have to do with today's presidential candidates? It has everything to do with them.  One of these candidates will determine what we are going to do to stop Iran from going nuclear — or whether we are going to do anything other than talk, as Western leaders talked in the 1930s.

There is one big difference between now and the 1930s. Although the West's lack of military preparedness and its political irresolution led to three solid years of devastating losses to Nazi Germany and imperial Japan, nevertheless when all the West's industrial and military forces were finally mobilized, the democracies were able to turn the tide and win decisively.

But you cannot lose a nuclear war for three years and then come back. You cannot even sustain the will to resist for three years when you are first broken down morally by threats and then devastated by nuclear bombs.

Can't Wait
Our one window of opportunity to prevent this will occur within the term of whoever becomes president of the United States in 2009.  At a time like this, we don't have the luxury of waiting for our ideal candidate or of indulging our emotions by voting for a third party candidate to show our displeasure — at the cost of putting someone in the White House who isn't up to the job.

Sen. John McCain has been criticized in this column many times. But, when all is said and done, he has not spent decades aiding and abetting people who hate America.  On the contrary, he has paid a huge price for resisting our enemies, even when they held him prisoner and tortured him. The choice between him and Barack Obama should be a no-brainer.

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DID ANY OF THIS HIT HOME?
If you are a fan of Obama's, all of this probably was dismissed as "partisan" and somehow wrong.  But these are not all "partisan rants."  They are reasoned analysis.  Think hard about who you want as the leader of the USA--your future and that of your children and grandchildren depend on this decision.

I hope some of It opened your eyes to the truth about the man whose soaring rhetoric somehow isn't matched by his  earthly actions.  The question is, do we want a President who will tell us what we want to hear in soaring rhetoric and then do something different--either naive, misguided or with a definite approach that he learned during the past 20 years of his life in a militant black church and as part of a city's corrupt political system?   I don't. 

WANT ANOTHER SCARY THOUGHT?
According to The Book of Revelations the antichrist will be a man, in his 40s, of Muslim descent, who will deceive the nations with persuasive language, and have a massive Christlike appeal.  The prophecy says that people will flock to him and he will promise false hope and world peace, and when he is in power, will destroy everything.   (Have you read any of the fictional "LEFT BEHIND" series of novels based on the book of Revelations?)

Does this sound scarily familiar?  Form your own opinions--logical, factual or spiritual--or ignore it at your own risk

SURE, THE ELECTION IS STILL 5 MONTHS AWAY--BUT THE FACTS--& CANDIDATES--AREN'T LIKELY TO CHANGE
Whether you like John McCain or not, he is a man of proven courage, of character, and one who does what he thinks is best for America -- and takes on all comers face to face --he doesn't equivocate and dissemble.  Perhaps this turns off some people, but I'd rather have a brave man of known strengths (and weaknesses) as my President, instead of one who says one thing, but for his entire life, has done something diametrically different.   Leopards don't change their spots, whatever color they are.

Best, John

"I wake up every morning determined both to change the world and have one hell of a good time.  It makes planning the day a little difficult."  --E. B. White

THE ENTERPRISE--Let's think together

THE ENTERPRISE

QUICK HITS
Sears/K-mart is coming apart, just like predicted in THE ENTERPRISE on two prior occasions.  (WSJ May 30, 2008 said:  "With another dismal quarter in the books, Sears Holdings Crop. is starting to look like it's being pulled toward the abyss.")Sales dropped 5.8%, management is decimated by firings and quits, and Eddie Lampert's heavy hand in decisions. (Although he has no retail experience in any form.) The stock is dropping.  Watch for store closings and real estate sales to prop up liquidity and results.  As the big 4Q retail period comes, watch for Sears/K-mart to start slow paying.  Caution!!

Durable goods orders slipped by less than expected.  GDP growth in 1Q was not negative, although it was a small positive number.  There is talk that a "recession" is not in the cards, but a long, flat and sluggish period with stagflation will be just as painful. 

Alcatel-Lucent merger is not performing--also predicted here.  Recent efforts are to talk up its prospects with shareholders, but only results will really convince them.  The past quarters have been a series of missed earning predictions and the integration is turning out to be more difficult than expected (by whom--a French company and an American company merging, with a female American CEO?)  CEO Patricia Russo says she is staying, but then why did the board approve a resolution linking her departure package to the company's performance?

Southwest proves again that smart airlines can succeed.  It has been very successful at hedging oil-related fuel costs, and has 70% of this year's fuel needs hedged to $65/bbl. oil.  Other airlines hedged 30% or less, even though a 2004 business case study from Oklahoma State explains Southwest's hedging strategy.  One key component:  decisions are made by a 3-person team, not a bureaucratic committee.  Even the best hedging will eventually run out in time, Southwest proves again that a smart airline that eliminates complexity and takes care of basics, can be successful at making money and offering good customer service.

Dell seems to be gaining traction, after sticking to its business model too long.  Thus: PPx@≠FF.  If you don't know what that means, read THE COMPLEXITY CRISIS.  This is a powerful way to describe a typical business failing in a simple equation.

With that one, I believe it's time to "plan ahead," or as the Boy Scout motto says, "Be Prepared."  How?  Let's think about things together!

WHAT'S LIKELY TO HAPPEN?
Sometimes, when you don't know what is likely to happen, it is useful to speculate, or to develop hypothetical scenarios.  Even if these aren't correct, they expose many of the variables that will influence what might happen, and stimulate thought about how to react to what might happen.  Rather than report on current events, let's consider the potential consequences.

IF OIL STAYS AT OVER $100 AND HEADS UP STILL FURTHER IN COST
Gas prices will rise further from current $4/gal. levels, putting still more strain on American consumers, especially the lower and middle classes.  Large, gas guzzling vehicles will become less and less popular.  The large SUVs and high performance cars will become the province of the wealthy.  Gas usage will likely drop off a bit.  Costs for freight and all forms of transportation will continue to go up, not the least of which is air travel.  Since transportation costs are embedded in virtually every product, those costs will also rise. Prices will be increased to compensate, fueling inflation.  (For those who don't recall the definition of inflation:  it is when more money must be exchanged for no more, or less value of goods and services)

If oil prices remain elevated for a long time, and no major new sources of supply are added to the current ones, another massive development will necessarily result.  Alternative energy sources that were once non-cost competitive, will become attractive.  That doesn't mean the stupid corn-based ethanol, whose existence relies on equally foolish subsidies to placate the 20+/- farming state and their Congressmen and Senators.  Solar energy, nuclear energy, wind, hydro-electric, geothermal and tidal energy all move closer to economic attractiveness.  Not all of them conserve gasoline, but in the total energy equation, any cost effective energy source influences the total mix.  Example: what good does it do to develop electric  or even hybrid cars, if the means of generating electricity to charge them is as polluting and hydrocarbon fuel intensive as the gasoline driven cars they replace?

IF FOOD INFLATION CONTINUES
Using corn for ethanol has added to an already serious global food problem.  It isn't that the earth can't produce enough food.  It's a matter of where, how much of what can be produced compared to where, how much of what is being consumed.  Corn ethanol is just another flaw in the system—as is global trade policy.  Some nations starve, others have plenty, and still others pay farmers to NOT produce food (guess who?).  As food prices are driven up by rising energy costs and by supply-demand driven increases in basic foodstuff, consumers get pinched again.  Even after trading down to a less costly mix of "groceries" consumers must eat.  Thus "inflation" will take another bite out of consumer spending, just like it did with gasoline.

IF PRICE INCREASES FROM CHINA CONTINUE
Costs of a vast array of products sold all over the world, but especially in the US, will climb.  These costs are already climbing due to China's decision to no longer rebate the VAT (Value Added Taxes) on exports, and due to China allowing its currency, the Renminbii to float further against the dollar (reducing buying power of US dollars still more).  China is reeling from and array of problems: recent natural disasters (earthquake), internal rebellion (Tibet), massive spending on the upcoming Olympics, rampant pollution of air and water, and recently, government mandated closing of low-tech businesses in areas where skilled labor is scarce, so that labor can be diverted to higher value goods.  Many factories were told that wages must be increased 17-19%, rendering them non-competitive.  This trend can only grow, forcing importers to find new low cost sources elsewhere. (Vietnam, Indonesia, the Caribbean, and even the USA?)

IF THE ECONOMY STAYS SLOW, SLUGGISH
Consumer spending drives about 70% of the US economy.  When consumers must pay much higher prices for gas, food, and Chinese manufactured imported goods, there will simply be less spending on other goods.  Total spending will still consume nearly the same amount of dollars, but the mix will be dramatically different.  That difference will ripple through industry after industry.  Those who are unprepared for it will be devastated.  Those who are prepared will still suffer, but may be able to find other solutions to the problem.  Forewarned is forearmed.  The financial crisis is still not over.  Credit remains very tight or simply not available.  Excess inventory of unsold homes will probably take 3-5 years to work off.  Housing is a large employer and a large consumer (direct or indirect) of US manufactured products, so when that industry drops to half its prior level of volume, so does everything else (except perhaps maintenance and low cost improvements on existing homes).

IF NOTHING MUCH HAPPENS DURING BUSH'S LAST 7 MONTHS
The last 1/2 year of the Bush Presidency will be memorable for what it cannot do.  Congress and stop or stall most of the Presidential initiatives.  The President's stature in the US and abroad are at an all time low.  In spite of the apparent progress in Iraq, 2/3 of Americans neither approve of the President or of the direction of the country.  The problem is that Congress is no better off.  Since taking control 17 mo. ago, the Democratic controlled Congress has proven its inability to fix much.  What it has done is prove its ability to spend money, waste money, and make much ado about little accomplished.  The recent $307 Billion Farm bill is typical.  It is stuffed with patronage project, wasteful spending and totally outdated subsidies. 

IF THE DEMOCRATS RETAIN CONTROL OF THE SENATE & WIN THE WHITE HOUSE
Democrats clearly cannot run their own primaries (FL, MI) and have made virtually not progress while in control of both houses of Congress.  What they have done is prepare to raise taxes and spend more of taxpayers' money on their pet programs--usually to give money to the underachievers in our society.
Decades ago, Jimmy Carter proved the error of a similar set of policies, which came on the heels of a similar set of acrimonious Democratic party primary battles.  In the very early 1980's Carter's legacy was double digit inflation and double digit interest rated, leading to a decade when the stock market went absolutely nowhere.

DEPRESSED YET?
If this sounds like a grim set of circumstances, it might be. A wise man once said, "Those who do not learn from history's mistakes are destined to repeat them."  These are a truly daunting set of circumstances we face.  But that said, we know that the USA can be a magnificently innovative country, in which immense things can be achieved.  This can only happen if the American people pull together and have a leader who can unify them—but in doing the right things.  Barack Obama is a truly inspiring speaker unless you listen closely to what he is saying.  Then the convenient contradictions, wrong-headed naivete, and the flaws in the most liberal voting record in the Senate betray both his stated intent and his misguided inexperience.

Most of the readers of THE ENTERPRISE are older.  To those of you who are in your twenties—try to talk some sense into your peer  group.  To those who have children who will vote for the first or second time, have a family meeting and explain how a free enterprise system creates wealth, enables the best people to get ahead, and still helps the needy, not with wasteful handouts, but with reasoned assistance. To those who are normally Democrats, think about what you are seeing and hearing, and think hard about the core beliefs of American Democrats you historically admired.  (John F. Kennedy, although from MA was far, far from as left leaning as Obama.) 

Ironically, the future of the current generation of twenty-somethings depends on them being willing and able to become disenchanted with the muse of Obama's speechifying, and to listen and understand the wisdom of the "old soldier", John McCain's long experience and patriot's zeal.  The pictures I see of Obama's rallies call to mind pictures from the past of huge crowds.  Study the pictures  and think about history. 

Who can change the future?  You can.   It takes one person at a time, making a difference. Will you?

Best, John
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THE ENTERPRISE—A TARGET RICH ENVIRONMENT

THE ENTERPRISE—A TARGET RICH ENVIRONMENT
 
A THOUGHT FOR MEMORIAL DAY
We truly take a lot for granted. Forget the football "heroes" & movie "stars".  Only two defining forces have ever offered to die for you: Jesus Christ & the American Soldier.  One died for your soul; the other for your freedom.
 
AN FYI FROM MY BOOK PUBLICITY WORK
I’ve been doing a lot of book publicity latel—podcasts, articles, radio interviews, and now a webinars—part of a series, The Ultimate Recession Planning Toolkit: Prepare Your Business to Thrive in Lean Times.   Here are excerpts from the notice—FYI:  Simplify Your Organization: How Reducing Complexity Prepares Your Business for Anything
In this webinar, John will outline how the key to preparing your organization for an uncertain economy lies in clearing out your business's clutter. Soundview Executive Book Summaries chose John’s latest book, The Complexity Crisis, as one of 2008’s Best Business Books.  Don't miss this extraordinary experience to bolster your company's planning with John's experience and examples!   The link for the webinar is: https://www1.gotomeeting.com/register/540787735

RECENT EXAMPLE OF CRIPPLING COMPLEXITY:  IRRESPONSIBLY COMPLEX PACKAGED INVESTMENT VEHICLES THAT CAUSED MUCH OF THE FINANCIAL CRISIS
Most of my past complexity examples have focused on products, and secondarily services, which are rich with examples of rampant complexity.  The one that may be having more near term influence than any of these is the complex, convoluted and flawed investment vehicles known as “derivatives” or “swaps.”  Other aggregations of investments bundled mortgages into complex groupings to achieve better than deserved ratings from financial rating agencies.  Complexity strikes in many forms.  Bottom line (like the well-known Enron business model):  if you don’t/can’t understand it, be suspicious of it.
 
YOU HAVE SEVEN YEARS TO LEARN MANDARIN
Geoff Colvin, arguably the brightest columnist in FORTUNE magazine, points out that China’s maturation as an economy puts it in line to catch the USA as the world leader in 7 years or so.  If this happens, it will end the 125-year USA reign.  The USA took over the top spot in 1890 from whom?  The Chinese, of course, and it’s not an issue of if, but when, we see the return of the former champion.  By the way, the Chinese were also world leaders and innovators centuries earlier.  For a fascinating read, check out this book: 1421: THE YEAR CHINA DISCOVERED AMERICA.  It drags a bit as the professor/author tries too hard to convince us of his case—but it will open your eyes and blow your mind.
 
BARNES & NOBLE + BORDERS—WON’T FIX A DYSFUNCTIONAL INDUSTRY
Publishing is part of the most dysfunctional industry I know.  This year, if trends hold up, could see 200,000 new books being published.  A tiny majority of them ever sell more than 1000 copies, or ever make it into one of the big bookstores.  Most are self-published, with help from the many companies who do this via on-line connections.  The problem these days is not getting a book published (although main-stream publishers are still selective).  It is getting it publicized and sold.
 
As the two large bookstore chains think about becoming one, I have to ask:  will this really fix anything?  Go into a bookstore.  It’s fun.  Try finding a specific book.  That’s not so much fun.  If you wonder how they cope with the enormous variety, the answer is, “not very well.  Of the books you see in a Barnes & Noble or Borders, 40% will be returned to the publisher unsold!  That’s right—4 out of 10.  Or they will, instead of being shipped around the country, be re-priced way down, as closeouts.  What a crazy business model.  Are digital books finally coming of age?  I have not yet tried them…but it’s time to take a look.
 
NEWSPAPERS DECLINING TOO
Circulation of most major newspapers is declining 3-4% per year (exceptions Wall Street Journal & USA Today) and with that goes advertising revenue, dropping at a 12-22% rate.  These papers have historically been the employers of the reporters who were the source of most investigative and analytical reporting.  The result of the decline is fewer and fewer reporters, doing less and less original reporting—that’s not good either.  Part of the slack has been taken up by the blogosphere—but its reliability is highly variable.  Lately, so has the reliability of some reporters from the best known papers.
 
JOE LIEBERMAN HAS IT RIGHT
Go see his excellent article in the Wall Street Journal.  He says it better than all the talking heads.  http://online.wsj.com/article/SB121132806884008847.html
Of course Joe Biden disagrees, so in the sense of fairness, here is the URL for his rebuttal. http://online.wsj.com/article/SB121150000249615875.html
 
BMW & MERCEDES PLANNING TO SHARE SOURCES?
I guess it’s a sign of the times.  Now that Mercedes is once again separate from Chrysler, it finds itself in the “smaller” size range along with BMW.  Both have high standards for components.  Both share a Germanic heritage.  So why not share some “under the skin” components and component suppliers.  It simply makes economic sense.
 
AIRLINE SERVICE & COST GRIPES
Latest scoop.  United and US Air are talking merger.  The lowest and next to lowest ranked carriers in service could be getting together.  Isn’t that exciting?  Now you can pay to have your baggage lost.
 
MACY’S NATIONAL PROGRAM—GO LOCAL
Think global, act local is the old saying.  Macy’s will be trying to do that, but how is a question mark.  It will simply fragment its focus and add immense complexity to do what?  The reason is a futile attempt to repair the damage done to legendary store chain brands like Marshall Field in Chicago.  Will this bring back MFCo shoppers to Macy’s?  I don’t think so.
 
BARACK OBAMA: BE CAREFUL—“YOU WILL BE JUDGED BY THE COMPANY YOU KEEP”
Years ago, my mother always told me to be careful because “I would be judged by the company I kept.”  I thought she was right then, and I think she’s still right. What does that tell you about Barack Obama & Rev. Wright, et. al.  No amount of excuses erases two decades of keeping company with Wright, Rezko (sure he just wanted to overpay for a vacant lot) and lots of others.
 
DID YOU BURN DINNER?—IN YOUR SUV?
Corn ethanol, the fiasco continues.  Food prices are up for a lot of reasons, not the least of which is that you are burning “corn products” in your SUVs.  Production of the 7.6 billion gallons of ethanol projected for use this year does several things: 1) Costs as much energy to make as it saves in gasoline; 2) Raises food costs, taking agriculturally productive land out of the food production business; 3) Barely makes a dent in the US huge gas consumption; 4) Requires a land area equal to the size of Maryland, Connecticut, New Jersey and Washington, DC.  Hmmm… Sounds pretty stupid in that context, doesn’t it?
FORECASTS THAT WE’LL RUN OUT OF “FUEL” MAY BE OVERSTATED

A hundred years ago, experts forecast that we'd all be knee deep in horse manure because of all the horse drawn carriages.  Things have a funny way of changing over time.  With oil way over $100/bbl. all the competitive comparisons change, and the motivation for new kinds of energy and new exploration also changes.  Solar, wind, hydroelectric, tidal, geothermal and nuclear all come into play in different roles.

Energy and water will be two of the huge issues in the next 20-30 years...but someone will find a way to solve both (after all, the planet is about 80% water--so desalination is one answer).  Nuclear is a proven alternative if the fear-mongers would stand down, and the amount of solar energy striking the earth is immense.  Somehow, we’ll find a way—but it WILL COST MORE!
 
OK, that’s a huge range of topics.  I only hope this edition of THE ENTERPRISE gets out this weekend.  I am in the midst of converting computers, email systems and more, and you know what complexity and change can conspire to do.
 
Best, John
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PS:  From The Moscow Times: Security services in Russia no longer have to encourage people to inform on their neighbors.  Why?  Because now the Russians gleefully inform on themselves via social networking sites such as FaceBook, Odnoklassniki.ru, etc.  Rumors in the Russian blogosphere are that the sites are being watched (and controlled/) by intelligence agencies.  Watch what you post.  You never know who’s watching you.

THE ENTERPRISE--LEARNINGS

THE ENTERPRISE--LEARNINGS

"IT AIN'T WHAT YOU DON'T KNOW THAT GETS YOU, IT'S WHAT YOU THINK YOU KNOW THAT AIN'T SO" --Will Rogers
I agreed to take one side of an on-line "debate" about the usefulness of social networking sites for businesses.  It appears to have struck a nerve, almost like the political arguments do.  Some folks are very upset, and come back with emotional responses.   Others agreed with me (I listed Ten Reasons I don't use Social Networking sites).  Still others (thank goodness) came back with reasoned and rational replies which educated me about how some of these sites can be used for business advantage--an area about which I intend to learn more. 

The primary two things I learned were: 
1) Some social networking sites can be effective business tools, IF you learn to use them, and IF you take the time to understand what they are good for--and what they don't do well (which I had not done enough of :-[ ).   That's an important learning.  There are good sites, and not so good ones; useful sites and those that are just mostly for fun--or trouble.  It's wise to learn which is which, before getting too deeply involved in any of them.

2) The other thing I learned is that when you take a strong position on a topic (any topic), somebody won't like it, and some of them are so upset, they will call you names.  I guess I already knew that, I just hadn't done it in on-line forums.  Another useful learning.  Don't pay too much attention to the name callers, since their insults didn't do much except make them feel good (I guess).  Pay attention to the ones with good input, success stories, and also, failures.  If you never fail, you don't learn as much as you might.

WHEN CUSTOMER SERVICE IS A DISSERVICE
Network Solutions, the company that sells on-line domain name registrations is also my web hosting company.  For the second time in a year, someone either hacked my site or tried to infect it with some kind of "malware."  Some PC-based site visitors received a warning message, but no real harm was done.  The harm done was the reminder that Network Solutions has some security issues and an incredibly frustrating customer service system--which makes it very hard to get service at all.  Yahoo! was my prior champ as being almost completely "un-contactable."  Now Network Solutions is vying for the title.  Stay tuned for the outcome.  The back & forth is still ongoing.

SAY SO LONG TO APPLIANCES AT GE
GE is an industrial products, entertainment and financial services company.  Appliances didn't fit, but were a carryover from its heritage.  It's now surprise that Jeff Immelt is cashing in that business (low margins, cyclical anyway), to put that money to better use somewhere else.

THE ECONOMY--IN RECESSION?  OR "A LONG FLAT SPELL?"
It's interesting how all the people who predicted a recession are now waffling about whether that's what we have going on right now.  Growth doesn't appear to have gone negative (a recession is defined as 2 successive quarters of negative GDP growth).  First, recessions can only be "called" after the fact.  That makes it of questionable value to hang the name on a flat or down economic period.  We are in a flat spell.  It's going to last quite a while.  Housing and the financial crises led the way.  Housing may be near the bottom, but the inventory overhang of unsold houses will take a long time to work off.  A couple of years is what many experts are betting. 

The government is throwing money, credit and low interest rates at the financial crisis.  it seems to be helping a little, as long as you don't have to borrow money.  Lenders are so tight these days, that getting a loan is nearly impossible--and if one is available--the interest rates will be sky high, and terms squeaky tight.  During a time like this, prudent people get very frugal.   Few people/companies cut back as fast as they should.  It's a time when the penalty for reining in spending too slowly is severe.  Sell hard.  Spend sparingly.  Look for creative ways to grow, and by all means, blow away any unnecessary complexity.

OBAMA ANGRY?  "IF THE SHOE FITS...
I have no idea whether George Bush was talking about Obama or Jimmy Carter or who in his "appeasers" remarks.  I do know one thing.  When the shoe fits,,,the wearer gets mad...which was Obama's reaction.  I hope Obama isn't as much of an appeaser as he's seemed, since he's the likely nominee and the favorite to be the next President.  Appeasers make a lousy commander-in chief.

MCCAIN LAYS IT OUT--RISKY BUT GUTSY
John McCain was here in Columbus and I should have been there live, but didn't make it.  He did a gutsy thing.  He laid out his vision for America circa 2013.  But wait, isn't that what a leader is supposed to do?  Share his vision with the people?  He may not be as enchanting as Obama, but he sure is not the third term of Bush either.  His vision made sense, given the situations and issues the next president will inherit.

DEMOCRATS CAN'T EVEN RUN THEIR OWN PRIMARY--LET ALONE A COUNTRY
Somebody asked me the other day, "How can the Democrats run a country when they can't even manage the primary process in their own party?"  I don't know, but I have this sinking feeling we'll find out soon....and it won't be pretty, I'm afraid.

REPUBLICANS ARE IN HUGE DISFAVOR AND DISARRAY
The Republican party has been badly wounded by the misadventures of the Bush administration.  Democrats are winning elections in the South.  But wait, when I was younger, the South was full of Democrats--except their ideas and beliefs were more like Northern Republicans.  Maybe the issue is the party affiliation and name, and not the beliefs.  Hmmm.  That bears more thought.

WHAT'S NEW?  NOT THIS RETAIL NEWS.
Wal*Mart's doing better.  Sears/Kmart is doing worse.  Seems like the more things change, the more they stay the same.  Target's doing OK too.  So is Lowe's.  Home Depot is improving, but far from fixed (at least based on the buzz I heard last time I was in Atlanta).  You don't need me--or economists--to tell you this. Just go shopping.  Get out there.

LEARNING
The conclusion of the learning story I opened with and the one I closed with is that the way to learn is to--get out there and see, hear and study things for yourself.  One of my favorite activities was taking my staff VPs shopping to see how our products looked at retail.  It was a real eye-opener.  The same goes for getting elbow to elbow with employees, and face to face with customers and suppliers.  Want to learn something?  Get out there and look, and ask questions--and then listen up to the answers--even from the ones who call you names.

Best, John

THE ENTERPRISE--Why is it so obvious to some and not to others?

THE ENTERPRISE--Why is it so obvious to some and not to others?

GIVE THE UAW (& GM) A GUN AND THEY WILL SHOOT EACH OTHER (OR THEIR OWN FEET)
The Chevy Malibu and Buick Enclave are two of the most praised vehicles of this year.  Handsome, functional, good quality at decent prices.  Both are (or were) made by GM--until the fools in the UAW shut down both GM and suppliers' plants.  I don't know all of the details, or even whether it is the UAWs fault or GM's fault.  But, 43 years of marriage has taught me one thing:  it takes two to have a fight.  That means they are both to blame. After Bob Lutz heroic efforts to get GM to design and build great cars, these idiots screw it up.  Neither Lou Dobbs' rants nor the Democratic hopefuls can overcome that kind of stupidity costing American workers jobs.

DEMOCRAT CONTROL OF THE NLRB = DEVASTATION TO AMERICAN WORKERS
Worse yet, a big part of the coming Democratic influence will be to take away to right to a secret ballot in a Union election, which opens the door to decades old tactics--coercion, intimidation, etc.  This effort started 12 years ago, and fell short then.   Now the Congressional Democrats--in spots bought and paid for by organized labor--are taking another run at going back to days of "mob rule" of union elections.  If they can pass the law they want, the simple act of signing union "interest" cards, under intense pressure, scrutiny, coercion and threats (the company can't threaten, but Union organizers can),  will designate a union to take over and represent workers in a non-union plant.  No secret ballot election.   No election at all.  That's the surest way to send those jobs down the street (to a more efficient, more cost competitive non-union plant ... or more likely across border ... or across the ocean.  And the fools don't see it (I meant the politicians).  The unions know exactly what they are doing.  The workers fear for their future, and pay in the process.  2 hours of each employees pay goes to pad the comfy lifestyle of the union bosses, and support for their political "servants."  Prediction:  if that happens, a massive job loss disaster will follow in a few years, followed by more cries for protectionism and all the rest.   Watch and weep--or vote and stop it.

JACK WELCH WOULDN'T BE SO "GOLDEN" THESE DAYS
With the accounting regulations in effect post-Enron, the old days of manipulating earnings quarter to quarter to always match the estimates given Wall Street are long gone.  Jack Welch wouldn't have looked so invincible in this environment.  He'd have ranted and raved and fired people but he couldn't have hoarded the money and manipulated the transactions like he did during his "flawless" run of always making GE's earning estimates.  Jack shot off his mouth this time, too.  He realized that he should have shut up as soon as he blurted out his ill-advised statements.  Now he need to keep his opinions to himself--and if he's as smart as I think he is, he will.

SOCIAL NETWORKING SITES ARE VIRAL ... OR CANCEROUS
I got a couple more of these messages this past week. It looked like emails from people I knew, asking me to sign up on yet another site.  Except if you looked close