On #religiousfreedom and #gaymarriage

For my slightly right of center friends who are still sucking down Pepto Bismol after today’s Supreme Court ruling:

You are conflating “right to religious principles” with wanting the rest of the world to be submissive to your religious narrative. Today’s decision doesn’t tell religious people how to relate to their “god.” What it does is say how the State should relate to those who choose to be a part of an institution, marriage, created by the State; an institution for which a citizen needs a license issued by the State before they can partake in it. Gay marriage doesn’t stop people from sending telepathic messages to Shango, Thor, Jah, Jehovah, or Odin….

It’s ironic that some churchgoers are more concerned about a section of the populace that want to enjoy increased inclusion in American society at no cost to the majority versus a small but dangerous portion of the populace that walks into churches and kill people because they believe that a certain race shouldn’t be a part of American society….

….the irony ….

Posted in civil rights | Tagged , | 1 Comment

Of ‪#‎WhiteSupremacy‬ and Domestic ‪#‎Terrorism‬

I believe that apartheid South Africa and al-Qaeda have provided white supremacists a blue print for not only gaining control of substantial portions of American territory but for governing it. The splinter cell model used by Islamic terrorists is flexible enough to disrupt transportation and communications hubs in the U.S.

Terrorists do not fit a physical description, much to the chagrin of most Americans who choose to remain naive about domestic terrorism. Timothy McVeigh, Terry Nicols, and now Dylann Roof have squashed the theory that terrorists are all a bunch of rag-heads.

Let’s face it. A fraction of the estimated 300,000 white supremacists in the U.S. as cited in the article below could, if properly armed and supplied, wreak havoc in cities like Atlanta, Baltimore, Jacksonville, and Miami. I get nervous sitting in traffic on I-75/85 for this reason. A few armed asswipes with automatic weapons could take out hundreds of drivers. Supremacists could easily put a hit on a black church in West End Atlanta and escape unscathed even with a police precinct in the neighborhood. I believe we take our safety for granted.

I lived in Maryland during the DC sniper attacks. To this day if I’m sitting at a light and I see any type of flash, I get jumpy. I still recall walking in a zig-zag from my car to the courthouse in Rockville hoping that my pattern would throw off a sniper; hoping I’d get home to my toddler son. A couple years later, the violent gang, MS-13, would leave its impact along the I-270 corridor, raising concerns for law enforcement and the public at large.

Terrorism is real. Combine its threat with a changing economy that is leaving more people disenfranchised and I believe you create something similar to an emergence of Hitler’s brown shirts. White men, especially lesser educated and unskilled, may allow themselves to fall victim to the hate-filled narrative that their circumstances are the fault of black and brown peoples. Today’s technology allows the hate to spread faster. Just imagine if Hitler had the internet to spread “Mein Kampf”?

Yes, we can all act like the line from Don Henley’s “All She Wants to do is Dance” and keep our heads stuck in the sand or we can start taking the initiative to seriously address hate in the United States. Ignoring it or being emotionally reactive with calls for prayer time won’t cut it. Many of these white supremacists are carrying bibles and singing “We Shall Overcome” as well. It’s just that their lyrics are a tad different….

Posted in American society | Tagged , | 3 Comments

My last comment on #RachelDolezal

Rachel Dolezal’s “misappropriation” of black identity raises this question: What does it mean to be “black”? That Ms. Dolezal was able to “pass” as black, both culturally and physically should have members of society asking how substantive it is to base cultural, social, and political identity on physical appearance and word phrases. In a society where identity politics is so rampant, Ms. Dolezal’s outing should be no surprise.

For example, could she have gotten away with saying she was West Indian? Physically, yes, but she would have failed almost every other test because being West Indian goes way beyond how you get your hair “did” and using a few cultural phrases.

If black or African Americans want to maintain a bottleneck on who gets to be called “black”, then a redefinition or refinement of the membership criteria for who can claim being a part of the African Diaspora in America is in order. As long as membership is this permeable, then “blacks” in America should get used to seeing more Rachel Dolezals….

Posted in American society, black American | Tagged | 2 Comments

Waiting to hear Hillary Clinton’s plan on how to rescue the middle class

From press accounts it seems we won’t hear much substance on economic issues from Hillary Clinton during tomorrow’s campaign rally in New York City.  The framework appears built on creating opportunities for the middle class according to articles in The New York Times and The Wall Street Journal.

While I expect to hear some populist buzzwords thrown around, I don’t expect Mrs. Clinton to harp on the banks or large businesses. Banks still lend financial capital and corporations, large and small, still deploy capital.  Without capital moving to areas of opportunity, there will be no incentives to hire a labor force capable of managing that capital.

Nor do I expect Mrs. Clinton to ask the middle class to be accountable for their share of the blame for the economic morass some find themselves in.  This includes failure to stay ahead of where labor and financial markets were heading; decisions to borrow and spend on non-income generating assets; and a failure to stay politically engaged beyond the usual two-year election cycle.

The middle class expects to be coddled and Mrs. Clinton may give them a little of that tomorrow as she swears that she is the candidate that can best “fight for them.”

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Jeb Bush should try viewing Putin as a corporate raider

Jeb Bush has been sharing his thoughts with German leadership and the European press about Vladimir Putin and his aggressive moves on the Crimean peninsular. The New York Times reports Mr. Bush referring to the Russian president as a “bully” and Mr. Bush as saying that Mr. Putin’s moves should be dealt with “resolutely.”  Mr. Bush believes that Russia will do what it pleases if left unchecked and Russia’s leadership, not its people should bear the brunt of the penalties issued by the West.  Mr. Bush went on to define the appropriate response to Mr. Putin as one that should show the Russian president what the consequences of his aggressive actions would be versus a response that was warlike or “bellicose.”

It may be a bit too late to show Mr. Putin the consequences of his prior bad acts.   According to a report in The Economist, Mr. Putin has gotten most of what he wanted and has given concessions to the West over the past year.  Mr. Putin has formally annexed Crimea, introduced instability into Ukraine making the nation toxic enough for the United States to avoid, he has avoided serious economic sanctions, and his popularity has increased.

Heck, even some U.S. congressmen have expressed admiration for his boldness versus the passivity of President Barack Obama.

Mr. Bush’s views are vague which should come as no surprise given that the U.S. is under 17 months out from the presidential elections.  What is also not surprising is that Mr. Bush’s views on Russia in general and Mr. Putin in particular are in line with other GOP hopefuls with the exception of probably U.S. Senator Rand Paul who has shown an aversion to anymore military adventures.  Rather, I think Mr. Bush and his GOP posse should start treating Mr. Putin’s moves the way a corporation that loses a bidding war to acquire a company treat the new competition.

Let’s face it, that’s what Mr. Putin’s takeover of Crimea is.  Mr. Putin calculated the rents he and his large state bureaucracy could receive from Crimea, including the claims to revenues stemming from the peninsular’s bank assets.  Consider this quote from another piece in The Economist:

“In an era when most wealth comes in the form of financial securities rather than physical resources, wars of conquest would seem to be a losing proposition. Why take over territory, when its value pales in comparison to that of a few credit default swaps? The Russian treatment of Ukrainian banks in Crimea suggests an answer: the conquest of physical territory can be leveraged to acquire financial assets, such as claims to revenue from car leases.”

That Mr. Putin was able to conclude that the discount rate applied to the future rents stemming from the invasion would not be increased by a high risk premium showed his prowess in assessing America’s lack of clout with Europe and the distraction in the Middle East.  It’s simply too late for Mr Obama or the next president to jack up the risk premium on Crimea. As discussed earlier, Mr. Putin already has what he wants.

If Mr. Bush became president, he would be stuck making the same half-assed moves as the current president.  He could try to make Mr. Putin’s newly obtained assets toxic by trying to disrupt Russia’s energy markets, but the big buffer would be America’s European allies who are more dependent on Russia’s oil exports than the U.S.  Expending the political capital necessary to get Americans to go along with any moves against Russia would require that Mr. Bush persuade the public that what Russia does in Crimea directly threatens U.S. citizens, an argument neither he, Mr. Obama, or any declared or undeclared candidates have yet to make.

 

 

 

 

Posted in Barack Obama, Crimea, Economy, Elections 2012, foreign policy, Political Economy, Ukraine, Vladimir Putin | Tagged , , , , | Leave a comment

Of ISIS, Vietnam, Iraq, and jingoism

Retired Army General Anthony Zinni, appearing moments ago on the PBS NewsHour responded to Barack Obama‘s decision to send an additional 450 military advisers to Iraq, raising the issue that ISIS poses a minimal threat to the U.S., a threat that is likely a lot less than Mexican drug lords on the U.S. border.

This move is similar to the decisions of presidents Dwight Eisenhower and John Kennedy to increase the number of advisers in Vietnam, according to Professor Andrew Bacevich, a retired Army colonel and professor at Brown University. “We know how to do this. We did it in World War II” was the rally cry for sending advisers to Vietnam and this gung-ho narrative is being echoed by supporters of Mr Obama’s decision.

Unfortunately, according to the Professor, after eight years in Iraq, the U.S. has not demonstrated that it can “do this” because if it were successful, the U.S. would not be having this discussion in the first place.

Fortunately for Mr. Obama, this decision to send more advisers comes in the middle of his second term versus the end of his first term and prior to a general election. Like Johnson he would have found himself being shown the door by his fellow Democrats. Instead, they, especially his supporters in the electorate, turn a blind eye preferring to keep the demigod on a shaky pedestal versus urging reason in order to properly ground his foot stool…..

Posted in Barack Obama, Iraq | Tagged , , , | 1 Comment

If Elizabeth Warren wants to promote labor, she should protect entrepreneurs

For the past three or four months there has been a lot of jawboning over the Trans Pacific Partnership (TPP) trade agreement.  The Administration touts the agreement as necessary to the United State’s ability to compete in an emerging Asia-Pacific market.  According to the Administration:

“President Obama’s trade agenda is dedicated to expanding economic opportunity for American workers, farmers, ranchers, and businesses. That’s why we are negotiating the Trans-Pacific Partnership, a 21st century trade agreement that will boost U.S. economic growth, support American jobs, and grow Made-in-America exports to some of the most dynamic and fastest growing countries in the world.”

The Obama administration believes the TPP will aid American business sales of product in the Asia-Pacific region by reducing tariffs on both sides of the Pacific Rim, in some cases to zero.  Think of a tariff as a tax schedule on products entering a country.  These taxes can make selling products overseas a bit onerous because the taxes will increase the price of the goods faced by the overseas end-user.

The Administration also hopes to increase transparency of laws and regulations in the Asia-Pacific market which, they believe, will facilitate entry into these markets by small and medium-sized enterprises (SME).  The Administration argues that small businesses account for two-thirds of new jobs created in the private sector and that easing entry into new markets will serve to maintain SME contribution to the American economy’s growth.

Regarding labor, the Administration’s focus appears to be on how labor is treated overseas versus ensuring against job losses here in the United States.  Critics, such as Senator Elizabeth Warren, Democrat of Massachusetts, argues that the President’s trade agenda does little to protect U.S. workers.   As an example, Senator Warren, in an opinion piece for The Washington Post, observed that under proposed provisions of the TPP, a Vietnamese company could challenge American labor law in an investor-state dispute settlement court, basically a panel of international arbitrators.  But if an American labor union wanted to challenge wage practices in Vietnam, it would have to go through Vietnamese courts, thus tilting the advantage to multinational corporations.

Mrs. Warren continues to place too much emphasis on labor as some protected class and not enough on the true economic engine, the entrepreneur.  Labor is an activity, a resource that is applied to capital to generate returns and income.  Demand for labor is driven not just by derived demand by consumers for goods and services but by what capital has determined to be the necessary skills and knowledge possessed by labor to deliver those goods and services.  Demand for labor is driven by the value labor brings to the capital the entrepreneur deploys.  Until Mrs. Warren and other progressives start understanding this, their arguments about the plight of the “labor class” will be invalid.

Where Mrs. Warren’s emphasis should be is on the benefits TPP would bring to the very entrepreneurs that will do the hiring of the labor Mrs. Warren wants to protect.  Employer firms with less than 500 employees employed 48.5% of workers on private sector payrolls in 2011, according to data cited by the Small Business and Enterprise Council.  You can’t talk about labor without talking about increasing access to markets by entrepreneurs.

What is missing so far from the TPP conversation is a substantive discussion on capital access and formation.  I don’t see this discussion on the part of the Administration and it is definitely missing from Mrs. Warren’s rhetoric.

Posted in Economy, entrepreneur, Political Economy | Tagged , , , , | Leave a comment

Is capital abandoning the entrepreneur as well?

Where small firms have suffered low rates of business formation, lukewarm employment growth, and near stagnant growth in employee wages, is there public policy that can reignite entrepreneurship?

Politicians on the left and right have been touting the virtues of small businesses as “job creators for the past four election cycles during which time the United States has been trying to dig itself out of the 2007 recession.  According to the Small Business and Enterprise Council, 99.9% of all U.S. businesses had fewer than 500 employees and firms with less than 20 workers made up 98% of all U.S. businesses.  In 2008, small businesses accounted for 46% of America’s gross domestic product, down from 48% in 2002.

And out of the 100 friends you may have, roughly 18% of them are likely employed by a firm that employs less than 20 people.  Out of those same 100 friends, 35 of them probably work for a firm hiring fewer than 100 employees.

But small businesses have been on the decline, not living up to the narrative politicians and policymakers have painted around them.  According to a report by Goldman Sachs, during the period 2007 to 2012, 600,000 small businesses and 6 million jobs associated with them have disappeared.  In addition, job growth, usually attributed to small businesses, has been sourced by big companies, along with increased revenues and wage growth.  While job growth averaged 42,000 a month between 2010 and 2012 for companies with more than 500 employees, small firms saw employee losses of 700 per month during the same time period.  Income growth has been near stagnant for small companies as well.

So what’s to blame for this change in small business fortune?  Goldman Sachs argues that part of the fault lies in new bank regulation.  New bank regulations have made business credit scarce and more expensive.  Banks find it less cost effective to finance smaller businesses and small businesses don’t have ready access to the less expensive public capital markets as their large business competitors do.

This reality check on capital availability for the entrepreneur has me asking if capital is abandoning the entrepreneur?  If banks are tightening lending to small businesses and the decline in small businesses is occuring at he same as the decline in lending, are there then any alternative capital markets that small businesses can turn to?

According to a report from Oliver Wyman, a consulting firm, government can use public policy tools to create an environment that offers alternative capital market mechanisms for flowing capital to small businesses.  For example, with the decline in the number of initial public offerings entered into by small and medium business enterprises, government sponsored clearinghouses can provide investors transparency regarding equity and debt issued by small business enterprises and tax incentives for investors holding publicly-traded shares in small business.  Government can also provide education to small business enterprises on the environment for issuing debt or equity.

Other benefits that government could provide include reducing capital gains taxes for investors who hold debt or equity issued by a small business enterprise and reducing the costs of regulatory compliance faced by small business enterprises that seek the efficiencies provided in capital markets that financial markets don’t provide.

Encouraging greater access to capital markets by small businesses provides benefits to businesses and investors.  The capital markets are more efficient than banks.  Capital markets distribute risks more efficiently and promote economic stability that results from immediate feedback that the markets provide to investors and businesses alike. By encouraging the use of capital markets, especially by reducing the costs to access the markets, government can make it easier for a business to access additional pools of funding.

Posted in business, capital, economics, Economy, entrepreneur, entrepreneurship | Tagged , , , , , | 1 Comment

America has a disease #BaltimoreRiots

America has a disease. Part of the illness lies in the hypocrisy and ineptness of its leadership. The disconnect between political and religious leadership with the masses is as palpable as rotting meat. These so-called “leaders” don’t have the gravitas to quell a disturbance. Those who are tonight speaking the “language of the unheard” aren’t listening to the mayor, their community leaders, and sure as hell wouldn’t listen to Barack Obama if he took a drive up I-95 to give a speech.

Why is leadership out-of-touch? Simple. Leadership is insular. It has rarely anything in common with the masses with the exception of skin tone and maybe, maybe, sharing a pew during a Sunday-go-to-meeting. Listening to the rhetoric of so-called “black” leadership I could draw no further conclusion that all I am hearing is empty, hollow, hotep slogans and assorted political bullshit. Leadership should be able to anticipate and relate. Leadership in‪ Baltimore‬ has failed.

No, rioting as I said earlier is ineffective. It’s not the language the media and the social elite are prepared to process and respond to. It should, however, put citizens on alert; that an incident of ineptness and injustice as projected by the death of Freddie Gray while in police custody is a scab that when pulled off will reveal a lot of pain, pain that America, hiding behind its hype and faded glory, is too afraid to address.

Unfortunately for the masses of the unheard, they adore and vote for an inept leadership that not only has failed at building communities, but have failed at showing people the path to empowerment and personal liberty. When you give the masses just enough in terms of housing, food, and education and deprive them of the tools for leadership and independence, this will be the reaction when the institutions controlled by inept and adored leadership fails.

America is due for a reckoning. Unfortunately an embedded leadership won’t provide the masses the tools to achieve that reckoning and the masses are too enamored with its well-dressed, over educated yet highly inept leadership to demand more….

Posted in Baltimore, black American, riots | Tagged | Leave a comment

Of ‪#‎Gentrification‬, ‪#‎capital‬, and moral arguments

Culture by definition is not expected to be static and when its eradication is sped up when capital seeks to occupy a vacuum. Culture, the skills, arts, etc., of a given people at a given time are, in my opinion, contingent on a particular eco-system and eco-systems are subject to change. Some change slower than others but none are guaranteed to last indefinitely.

This reality is overlooked by “black” Americans who are taken aback by the changes in their neighborhoods driven by an influx of capital with the purpose of making their neighborhoods more affluent or upscale with the endgame of selling renovated property for a capital gain.

I am extra mindful of this today given that 50 yards from my window here in the West End of Atlanta, an annual street festival is taking place to showcase, I suppose, the upside of an otherwise stagnant neighborhood. You see more whites in the neighborhood during this event than any other time of the year. Were it not for the white flight of the 1950s and 1960s the West End, which was once its own town, would still be majority white. But white flight like the capital held by whites ebbs and flows like a tide and the tide of investment is pounding the beachhead of this southwest Atlanta neighborhood.

With foreclosed properties and average household incomes around $23,000 to $25,000 a year, the West End is a target rich environment of distressed properties. Capital abhors a vacuum and as events like the street festival brings its annual scouts to the area, capital should attach itself to the profitable opportunities it finds.

The push back against gentrification usually poses arguments that mix morality and community economics. “If rents get too high, where will the people go?” “The neighborhood has been ‘black’ for decades and we’ll lose our culture if this continues.” “The white man likes our culture but doesn’t like us so he’s pushing us out.”

The arguments are heartfelt, coming from a morality honed from the brutality of slavery, the violence and humiliation of Jim Crow, and the systemic discrimination so engrained in the economy that at times it is analyzed and accepted so dispassionately by those whose histories have nothing in common with blacks. In the end, however, given the current decisionmaking process that accompanies capitalism, its impact on eco-systems, and no guarantee of a static culture, the arguments, no matter how morally driven, make no difference. Neighborhoods will change.

The question is, if one wants to maintain a neighborhood’s culture; that certain feel, look, and rhythm, what changes in the mindset of its inhabitants are necessary?

First, property owners will have to address the differences in investment approaches in their own ranks. Some property owners welcome the potential change. They want new capital and the benefits that come with it: new consumer and job opportunities. Other property owners are willing to sacrifice increases in commercial activity in exchange for maintaining the community’s “blackness” which usually means keeping blacks in the majority of the community’s populace.

Yes, affinity brings comfort but that affinity could devolve into familiarity breeding contempt if opportunity and capital do not flow into a community. “We look alike but we poor together” just doesn’t fly.

Community leadership should focus on aggragating investment capital from within the commmunity in order to spend that capital on one or two projects that provide labor with job opportunities while generating returns to investors. Opportunities and income should be recycled in the community first increasing the level of affluence in the community. Leakage of income, output, and opportunity should be minimized.

In addition, community leadership should be more aggressive in incubating business startups. Work needs to be done to encourage a diversification of businesses while mentoring startups around the pitfalls that all too often lead to their early exit.

In short it will take action. Moral arguments made to government officials provide no long term solutions. Continued investments and strategic partnerships hold the key to tweaking gentrification where affluence can be generated within a community for the people already there…..

….. but you have to want it…..

Posted in Atlanta politics, black American, capital, Economy | Tagged , | Leave a comment