Nicholas de Wolff

Happy Presidents’ Day

Fragile China – Treat With Care

How many of you were aware that China and the US almost went to war recently (according to Chinese mainland media and other sources)? Did you know that China had rebuffed Obama’s request for Secretary Gates to come visit his military counterparts in China (to discuss North Korea situation), refusing to allow the US to meet with military leaders in Beijing; that the US parked several fleets around the nation as a show of indignant force; and that people in China were being prepared by their leaders to rise up and fight “the evil Americans”? I have friends in China who had their bags packed, ready to flee. Yet we heard precious little about this over here.

We are also hearing precious little about China’s enormous investment in the African continent, helping almost every nation therein build up their infrastructure, and investing heavily in natural resources. Just as many see the US as having helped to rebuild Europe in the post-war years, China is building a reputation through the African nations as the benevolent partner…

How are US corporations and administrations responding to the inescapable growth of this Asian culture? We cannot seek to slow down or arrest the development of this economic and cultural force. Attempts to crush evolutionary movement tend to hurt the instigator (see RIAA attempts to stop digital file downloads, as a smaller scale example).

China is bigger than most people seem to consciously calculate, and their business and social culture is very different to the aggressive, fast-moving instant gratification, individualistic culture manifest in US business and society. Are we SO arrogant to think WE can change THEM?..

I wonder how long it will take us to learn how to interface truly effectively with Chinese leaders (government and business), and whether that learning curve will prove simply too long to save us from painful decline as a leading global influencer of policy…when our Secretary of Defense is told to go fly a kite by a foreign nation, you know that more than icebergs are shifting…

Proud Men Dressed in a Little Brief Authority

Extant the fact that free market capitalism is perhaps the wrong term to use here, this is still another mesmerizing animation from the RSA folks!

Then again, there are several other flawed arguments in the animation above (capital does not equal paper money; Marxism is not the answer to 21st Century realization of long-brewing economic imbalances; you cannot collect $200 unless you actually pass GO)

Investment advisor, Peter Schiff has become famous in the past few years for his 2006-07 predictions, in the face of much scorn and derision at the time:

Of course, retroactive editing is a marvelous thing for one’s reputation, but the argument holds: our nature as modern consumers prevents us from being able to invent new models for social and business welfare. Are “Capitalist” and “Marxist” the only two options? We scoff at the idea that we might be wrong while the opportunity still remains to learn and course correct. We paint our situations, our challenges, and our solutions with bold strokes, but always tend to use the same colors…

Shakespeare’s Isabella put it well, when she said:

“…man, proud man,
Dress’d in a little brief authority,
Most ignorant of what he’s most assur’d—
His glassy essence—like an angry ape
Plays such fantastic tricks before high heaven
As makes the angels weep; who, with our spleens,
Would all themselves laugh mortal”.

William Shakespeare – Measure For Measure Act 2, scene 2

Will more stimulus be our salvation or our death knell? Are we in a recession, or entering a Depression? I’m no economist, but I do know that tens of thousands of Californians who would love nothing more than to be gainfully employed just fell of the unemployment benefit rolls, with no job in sight…

One Cycle at a Time…

Last week’s LA Street Summit was both inspiring and frustrating.

It was great to see over 500 people in attendance at this free one-day workshop and networking session – nearly double the number from last year. It was wonderful to observe several corporate leaders and sponsors making their presence known, and it was great to see so many people committed to the idea of livable urban centers, in a community that has long enslaved itself to the automotive culture. The workshops I attended were informative and energetic, and I look forward to this event expanding its reach, if only to “keep the dream alive”.

My frustration stems from an observation that our communities are long on energy and “foot soldier commitment”, but short on policy-making leadership. The difference -at least with respect to the issue of implementing complete streets and sustainability initiatives – between Southern California and New York (from whence guest speaker Janette Sadik-Khan hails) is largely in how government and businesses function, relative to their populace.

Mayor Bloomberg runs the City of New York, and – but for the possibility of bureaucratic opposition from his own lieutenants (and the inevitability of fiscal cuts), he is largely able to manifest his vision of a more sustainable urban metropolis. This is in no small part due to the intelligence, passion, charm, and drive of his Transportation Commissioner, Ms. Sadik-Khan. What she has accomplished, over the course of the past 3 years, is a success story likely to propel her into President Obama’s cabinet, or at least in to the history books, as an example of policy-making leadership, urban vision, and community spirit.  It is also due to the fact that businesses in Manhattan welcome the idea (albeit sometimes begrudgingly) of making more navigable and accessible the 60% of the city’s real estate that comprises the streets and open spaces. If people can get around more easily, they’ll hang around for longer, they’ll wander around more agreeably and, as statistics are already showing, retail sales will go up, rentals will rise, and home sales will skyrocket. No need to even mention the more obvious social, environmental, and medical benefits.

Meanwhile, back in SoCal, or LA County to be specific (since the OC has made quite a good start, I must admit), policy-making leadership and visionary municipal governance are apparently as welcome in the council chambers of Burbank, Beverly Hills, and Los Angeles (among others) as Universal Health Care Legislation is at a Tea Party Rally. The various municipal councils seem utterly incapable of committing to any endeavor that does not have granular buy-in from 95% of their constituency. They (council members) argue that their role is to represent the people, but I offer the counter-argument that sometimes we, the people, are not in the best position to make and manifest policy. Democracy gives us the right to elect those whose beliefs most closely resemble our own, and to neglect those who do not aspire, or have failed, to deliver on promises which we hold dear. Great change rarely is manifest by a committee, and meanwhile, our streets become gridlocked, our air thickens with smog, our children grow obese, and we increasingly sequester ourselves in our hermetically sealed homes, with our 3 cars sitting in the driveway, and the light from 5 TVs permeating each household.

Yet, we are still far enough from the point of despair suggested by some of my above comments that we – business leaders, political activists, residents, taxpayers, et al – have a great chance to do our part, if we are not doing it already.

If you own a business, have you ensured that it welcomes and supports your employee and customer/client efforts to walk/bike/bus/metro to and from your location? We should focus a little less on building massive parking lots above and beneath our offices, and behind our stores and restaurants. If city ordinances demand it, we must campaign for alternatives. Instead of 3 parking spaces per 1,000 square feet, why not 2 spaces and 12 bicycle stands? Better yet, why not measure and manage community parking spaces from a truly communal perspective. Perhaps metrics should be managed on a neighborhood basis, and not “per-business”…

If you work with, in, on, or within spitting distance of municipal government (especially if you are an engineer), rediscover the joy of innovation! Stop MANAGING the problem of urban sprawl, gridlock, and parking, and start SOLVING it. Putting a lid on a boiling pot of water, does not cool the water, it merely delays, and eventually renders explosive, the challenge.

If you live, work, or play in an urban locale, make 2010 the year when you will (a) ask your employer about alternative transportation options, or offer your employees incentives to explore said alternatives; (b) explore your city’s rail, bus, and pedestrian networks (make it a family adventure!); and (c) challenge your municipal leadership to demonstrate the type of vision and commitment that was so warmly shown at last weekend’s Street Summit.

It needn’t happen overnight. Baby steps. One step at a time. One cycle at a time…but let’s keep moving:

(Links courtesy of lastreetsummit.org):

VIDEO:

• LA StreetSummit 2010: Building Momentum for Change (Streetsfilms)
• NYC DOT Commissioner Janette Sadik-Khan Q&A in LA (Streetfilms Shortie)
• StreetVids: See You Tomorrow at the Street Summit (L.A. Streetsblog)

AUDIO:

• Go Play in the Street: New York’s Transportation Commissioner Wants to Re-work Los Angeles (KPCC)
• Streetscast: Full Audio of Janette Sadik-Kahn’s Speech Last Night (L.A. Streetsblog)
• Streetscast: StreetSummit Speakers Inspire, Educate and Rally Livable Streets Advocates (L.A. Streetsblog)

ARTICLES:

• A New Route to a Better L.A. (Huffington Post)
• Sadik-Khan Packs the House, Then Brings It Down (L.A. Streetsblog)
• NYC Commissioner Says L.A. Should Quickly Move on Transportation Pilot Programs (LAist)
• Streeeeeet-Summiiiiiiiiiit(Urban Adonia)
• Carless Streets and Creative Thinking: What LA Can Learn from NYC (Curbed LA)
• Why StreetSummit was just the 2nd most inspiring thing I saw this weekend (BikingInLA)
• L.A. Street Summit, The Time Is Now, Let’s Kick Some Ass (Gary Rides Bikes)
• Janette Sadik-Khan on Changing the Transportation Game (Urbanophile)

Plus ça Change…

Our resident political opinionator, Jeremy McGuire offers the following book review:

In the middle of a recession there are invariably questions about how we got into it and what we can do to get out of it.  Politically, it quickly devolves into a conflict between the market driven laissez faire economists and the interventionist Keynesian ones.  Television and radio infotainers yammer on, using their own peculiar jargon that leaves the rest of us – who are not economists – as much in the dark as we were before.

I wanted to know more, so I picked up Liaquat Ahamed’s detailed history of how the world stumbled into the Great Depression, “Lords of Finance.”  Ahamed is a twenty-year veteran of investment banking and some paragraphs have to be read over a few times, but generally it’s written for the layman.  It comes in at 508 pages, without notes, but it reads like a well-crafted novel.

The main characters – the “Lords” themselves – are Montague Norman of the Bank of England, Hjalmar Schacht of the Reischsbank in Germany, Benjamin Strong of  the N.Y. Federal Reserve Bank, and Emile Moreau of the Banque de France. all of whom were well intentioned but ultimately flawed men who were not immune from the kind of gross miscalculations and unwarranted fears that led to the financial disaster of the Great Depression.  While a great deal of information may be gleaned from their stories that is applicable to the present one must be cautious: 2010 is not 1929.

Some of the miscalculations early twentieth century central bankers made were over the conduct and financing of World War I.  No one in financial circles believed the war would outlast the various governments’ ability to pay for it. They were all on the Gold Standard, you see, and the financial resources of each country were tied to their reserves of gold.  It was hard to imagine Germany, France and Britain would be so foolish as to burden their countries with massive debt just to keep a war going.

These top-hatted and stiff-collared expert prognosticators, mired as they were in centuries-old financial traditions based on the availability of precious metals, completely overlooked the proclivity of wars (particularly wars between monarchies, empires and single-party republics) to be self-sustaining and self-fulfilling.  If wartime governments run out of money, they borrow it, mostly from foreign banks incurring massive debt.  If they don’t have enough currency, they print it, all to keep the war going toward ultimate victory, at which time all debts will be easily repaid.  Or so they thought.

The incipient catastrophes that resulted from financing the First World War in so unsustainable a fashion were exacerbated by the enmeshment of world financial interests.  In the introduction, Ahmed explains, “Because financial institutions were so interconnected, borrowing large amounts of money from one another even in the nineteenth century, difficulties in one area would transmit themselves throughout the entire system.”

Ahamed stops way short, however, of ascribing this financial entanglement to any conspiracy of central banking institutions.  In retrospect it may read like a Dan Brown novel, but conspiracies require agreement, and the central bankers in the 1920’s could agree on almost nothing.  Scrambling to force some post-war order on the economies of their respective countries, they formed alliances, made enemies, forced concessions, engaged in blackmail and all manner of intrigues eventually stumbling into Great Depression through incompetence, a too rigid loyalty to ideological principles, and misguided policy.

The biggest blunder on the road to the Great Depression was the New York Fed’s decision to lower interest rates.  It may have helped Germany’s cash-flow, but it caused massive speculation on Wall Street, as investors borrowed more and more money to purchase stocks, further inflating the bubble that burst on October 29, 1929 – “Black Tuesday.”

Ahamed writes, “Their goal is a strong economy and stable prices. This is, however, the very environment that breeds the sort of over-optimism and speculation that eventually ends up destabilizing the economy.  In the United States during the second half of the 1920s, the destabilizing force was to be the stock market.” (p.280)

We are put in mind of the economic situation in America before the current recession: Overspeculation, easy credit, artificially inflated prices, and a protracted military campaign resulting in massive “bad debt,”* much of which is held by foreign banks, principally China.

In the Depression, as well as today, the main conflict on the road to recovery was,

“Between those who believed that governments could be trusted with discretionary power to manage the economy and those who insisted that government was fallible and therefore had to be circumscribed with strict rules.” (p.230)

Traditionalists said Government should keep its hands off the economy and allow the “invisible hand” of the market to determine its course as proposed by eighteenth century economist Adam Smith.  Others, principally twentieth century economist Maynard Keynes, said the government must have control over the economy to keep market pressure from destabilizing it.

“The real issue for the [Federal Reserve] governors was that many of the banks closing their doors…had sustained such large losses on their loans that they were … insolvent, [the governors] made it a principle to let them go under.  They failed to recognize that by doing so they were undermining public confidence in banks as a repository of savings and were causing the U.S. credit system to freeze up.” (p. 391)

What government aid did come was too late.  By that time, Ahamed writes, “Banks, shaken by the previous two years, instead of lending out the money, used the capital so injected to build up their own reserves.”

Ahamed seems to say that when a crisis looms, the injection of funds to shore up failing banks should come sooner rather than later and in sufficient quantity to capitalize the banks and allow them to begin lending.  When Adam Smith’s “invisible hand” goes arthritic, Maynard Keynes is there to take over the heavy lifting.

Amid the chorus of our own contemporary “know-nothings” who spout partisan absurdities about the government not getting involved in economic policy, or how deficit spending to get the economy out of crises is tantamount to cultural Armegeddon, Ahamed’s analysis is a voice of reason. “The Great Depression was caused by a failure of intellectual will, a lack of understanding about how the economy operated.  No one struggled harder … than Maynard Keynes.  He believed that … economists are the “trustees, not of civilization but of the possibility of civilization.” (p. 504)

That’s something even an artist like me can understand.

(*Bad debt is, according to Robert Kiyosaki, debt that does not put money in your pocket).

Jeremy Mcguire is an author/illustrator, humorist and social commentator. His weekly articles appear in a variety of publications, and are archived on the blog, Baloney & Blarney.

Liberal/Conservative

Following hot on the heels of the recent Massachusetts special election, well-known Chicago author and political humorist Jeremy McGuire has contributed the following:

Open Letter to Both my Liberal and Conservative Friends.

Chill.

To my Conservative friends, You may be feeling right plucky over Scott Brown’s victory in the Massachusetts special election to fill Edward Kennedy’s Senate seat. Don’t. In the long run, it changes nothing. The conservative function is and always has been one of restraint, of keeping the status quo, of caution. You are what Joseph Campbell calls “the holdfasts.” That said, you must understand that you have chosen to be on the wrong side of history most of the time. You will not win. I know this because you never have. It is not your destiny. There are few progressive social leaps that we as a species have made that were not initially opposed by conservatives, but embraced and defended by them within one or two generations. The arc of history leans toward change, toward progress, toward tolerance, and understanding, decidedly away from the status quo.

It was the influential clergyman and educator Endicott Peabody who said “Things in life will not always run smoothly. Sometimes we will be rising toward the heights – then all will seem to reverse itself and start downward. The great fact to remember is that the trend of civilization itself is forever upward, that a line drawn through the middle of the peaks and the valleys of the centuries always has an upward trend.”

The most obvious examples of your being left behind by history are the abolition of slavery, votes for women, and the dissolution of Jim Crow and the passage of the Civil Rights act of 1964.

What was acceptable, and even embraced a little more than a hundred years ago, colonialism and wars of conquest, are now no longer acceptable. Oh, and there was this little thing called the War for American Independence from England. Yep. Conservatives opposed that one, too. They were called Tories then. Yet now conservatives celebrate Washington, Jefferson, Adams and Franklin as if they were kindred spirits, when in actuality, they would have had them hanged. (Note: All of these gentlemen considered themselves Liberals. Maddening, ain’t it?)

Now, I’m not being critical, those are just the facts, a pattern that is readily discernible to anyone who can step back far enough from the immediate issues and events to see it.
Oh, you may gain ascendancy for short periods, and by that I mean 20 or thirty years, particularly if the people are persuaded that there is much to be afraid of, but it is never lasting. Fear is so fleeting that it cannot sustain your power. Do not allow those ephemeral victories to lull you into a sense of entitlement. You saw what that got you in the last election, right?

So, let’s just accept the fact that you have chosen a role in politics that will never be ultimately victorious. Look around at the social issues that are most prominent now. I mean universal health care, full civil rights for all gays, equality of pay and the like. You won’t win those either. The world moves forward; it does not stay still nor does it move backward. Frustrating? You betcha. But there it is.

So, should you just fold your tent and go hide in the woods somewhere? Absolutely not! Remember, your position is the “hold-back” one. What are you holding back? Why, the Liberals, of course.

Okay, my Liberal friends, now it’s your turn.

Do not gloat. Were it not for the Conservatives, you would run hell-bent-for-leather toward the edge of any number of cliffs, secure in the belief that you could fly! We have seen time and again the good-hearted but wrong-headed policies that have had unintended consequences.
Step back and consider what the term liberal means. Webster says it means “tolerant, open-minded and generous.” That’s as good a definition as I can find. That means you must be tolerant of opposing opinions. You have not often been so. I speak, of course of the late “Political Correctness” which was the very opposite of what a liberal stands for.

In the Seventies, many radical groups began calling themselves liberals. They were not, but true Liberals did not call them on it and so the terms “radical” and “liberal” got confused, by everybody, not just the right.

The most egregious example is the matter of the state’s attitude toward religion. We do not and never have wanted the state to mandate any one religion and so we erect an “impenetrable wall” between the state and religion. However, that was never meant to imply intolerance toward all religion, which in its finest moments enlightens and ennobles us, transporting us from the mundane and profane world into the realms of the sublime (I said in its finest moments!).

The first part of the First Amendment reads, “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof.” What does that mean? It means I have the right to pray and display religious items wherever I want. Anywhere. Any time. The Government can’t say squat. Get real. Nowhere does it say that religious expression can be or should be banned. It states exactly the opposite. A Supreme Court ruling that prohibited schools from mandating the prayer of one religion over all others was intended to foster tolerance but has had the exact opposite effect.

If you are indeed liberal, you should not object to nativity scenes on public land; public land belongs to all of the public, even the religious.

However, Conservatives, don’t start preening! Those who wish to express their freedom of religion on public land should note that Wiccans have an equal right to put up display celebrating the Winter Solstice! Are you ready for that?

Okay, that’s an extreme example of unintended consequences. There are others. In any case, you Liberals should be grateful for the Conservatives. If it is true that they have pretty consistently grown to embrace programs they initially opposed, it is also true that without their opposition, you would accomplish very little of any import. Creativity requires obstacles to get over, under, around and through. Without those obstacles, your ideas would never be shaped, sharpened and honed. Conservatives force you to prove your points and in so doing help you make your points.

Lets face it. Both Liberals and Conservatives have been in the past rather intolerant and disrespectful of each others positions. That cannot last. It is an untenable stance and the Republic suffers from it. Both Liberals and Conservatives need to embrace their root principles and expel those who use those terms to practice intolerance, bullheadedness, and downright hatred. Hatefulness, intolerance and disrespect have never accomplished anything except reinforcing those negative qualities to no purpose. A destructive cycle. Don’t allow extremists to assume the names of Conservative or Liberal.

To my Conservative and Liberal friends: Get rid of your nut-jobs.

Jeremy Mcguire is an author/illustrator, humorist and social commentator. His weekly articles appear in a variety of publications, and are archived on the blog, Baloney & Blarney.