Race relations

The recent controversy surrounded the owner of the LA Clippers and his racial remarks brought back memories from my youth and since I am about the same age as the man in question, I thought it might be informative. Growing up during the 40’s meant that we lived in segregated towns and black kids went to the black schools and we rarely had any contact with black kids. We didn’t go down town and neither did they. I went to a Catholic High School and kids came from all over town but there was only one black kid in my school of 400 students and he was brown and I never really thought about his color. I was more exposed to the black community than my friends because my dad was a milkman and I used to help him in the summer and his route was in the black part of town. In general conversation blacks were referred to as colored people or Negros but I did hear the fathers of my friends use the word “nigger”. My dad did not use that word so I didn’t and most of my friends did not use the word. I seriously doubt that someone never used that word. This segregation in a way led to the 60’s revolution. The children of that day, the baby boomers grew up with TV and movies and had access to the outside world that we lacked. For the most part we were unaware of how the blacks were treated in other parts of the country so when TV came in and we begin to see the world outside of our own neighborhood, it was a real eye opener. These baby boomers were taught by their parents to respect others and when they grew up and saw what they presumed their parents allowed they rebelled thinking their parents were hypocrites. They didn’t bother to find out why their parents were the way they were and just assumed the worst. As they rebelled against their parents this rebellion carried over to other areas and opened the door to the civil rights area. It was a rough time but the country came out of it a better place. Knowing how things were when I grew up, it is my guess that many people have used this kind of language and may feel the way this guy does but they haven’t had anyone record and publish their private conversations. If I were black and had grown up being treated as a second class citizen, I might well have had strong feelings toward my oppressors and may have expressed those feelings in private conversations. We have made progress in racial relations but it is slow and will be generational. As these old guys die out things will improve. I think it is difficult for them to change their feelings but as gift to the future I hope they refrain from expressing them in front of younger people, people who are in the process of forming their opinions on race.

FOIA

The Freedom of Information Act known as FOIA was enacted in 1966 and has been used many times to get information from government records but I never realized how powerful it was until this week. A private group seeking information about the Benghazi Embassy murders requested and received documents, one of which was an email from a White House official emphasizing that the riots were caused by a film. To underscore that these protest are rooted in an Internet film and not a broader failure of policy. What is startling about this is that congress requested this information but it was either not given or redacted from the documents. This tells me that FOIA has more power than congress.

Pot

There is a strange phenomenon going on in the world of smoking. There is ample evidence that smoking is bad for your health on several levels and there is some evidence that this is also the case with second hand smoke. Enter the controversy! Smoking E- cigarettes vs smoking pot. Pot has many of the same carcinogens found in tobacco and yet there is an effort to make pot more available to the public while there is a push to limit the use of E- cigarettes. A burning cigarette releases about 7,000 chemicals while only three have been found in E- cigs and these at the level of one- one-thousand of the amount found in tobacco. Pot has a similar number of chemicals and like cigarettes many are carcinogens. Based on the best evidence E-cigs are less likely to cause health problems than pot and that is even more evident in the second hand smoke, yet it seems that the health concerns are misplaced.

Affirmative action

The Supreme Court this week struck down the concept of affirmative action otherwise known as quotas. Some say this is much too soon that we still have a long way to go and others say the time has come to recognize the progress that has been made regarding race. The new suggestion is that it should be place not race. This means that if you are born and raised in certain areas you deserve special treatment when it comes to such things as getting into a university. I believe this is the reverse of what used to be called red lining. Back in the 50’s and 60’s mortgage lenders would draw a red line on a map indicating areas where people would not likely qualify for a loan. This practice was discouraged and many people got loans which they could not afford and subsequently lost their homes. If we go to this approach will many people who cannot compete in college get in only to fail? On a personal note, I was managing a plant in Alabama in 1970 and affirmative actions was coming into its own. I received a call from the home office in Minneapolis and was told to check the percentage of blacks in the community and make sure that percentage was represented in the plant. I did that and discovered that we had 16 black employees and needed to hire 11 more. I contacted a friend of my, a black dentist who lived in Huntsville and asked if he would recommend some black families in our area and he sent me a list. I contact those people and as openings occurred we brought in black employees. So far so good. This worked out well because we had a high rate of turnover and openings happened on a regular basis. The question is what would I have done, if we didn’t have a lot of turnover. What would you have done?

terror insurance

Recent coverage of floods around the country has raised the awareness regarding flood insurance. People now understand that their home owner’s policy does not cover flood and that they must purchase a special policy provided by the government and sold through private insurance companies. There is another potential hazard that most people are not aware of and there is currently no insurance available to cover this hazard. I live 10 miles from a nuclear power plant and if an accident occurred there and radiation escaped and contaminated my house the power companies have set up an emergency fund to cover my loss. They would cover all of my expenses associated with my having to relocate until such time as the radiation threat was removed. In the event that a terrorist would set off a dirty bomb in Minneapolis the prevailing north-westerly winds would bring radioactive dust particles to my house and I would have to vacate. Any direct damage caused by such a bomb would be covered but the radiation hazard is not covered. In other words I may have to live years away from my house but would be responsible for making the loan payments while I incurred rent expenses at some new location. I have contacted the state insurance department concerning this issue and have received no response. I have contacted several large insurance companies and they seem to be uninterested. It would have to be a government policy similar to flood insurance and neither the government nor the insurance companies seem to care. If such a terror attach ever occurs it will be after the fact when everyone wakes up and says we need some type of insurance to cover things like this.

Fair

Words have consequences and one word that always catches my attention is “fair”. This is a word that has been downgraded because it has taken on political meanings. It is a word that has no place in a free market society as it is better suited for a communist type government. Under the communist system the central government is responsible for planning. Imagine the formidable task this represents. A group of experts sits in a room and must decide in advance how many shoes the country needs this coming year. How may shirts, how many bushels of wheat, how many cars and so on. One way to simplify this impossible task is to bring in the concept of fairness. If we just have one type of shoe but different sizes and one kind of shirt but different sizes, one kind of breakfast cereal and on down the line the whole process is made easier. If this sounds a little weird just recall China shortly after the communist took control. Recall the pictures of the Chinese people all wearing those dirty gray colored shirts and pants and wearing the same kind of shoes. Since the enormity of this project is so great that no group of people could master it, these types of economies fail. The idea of fair does not work in our system and I offer an example. The average family income in America is $50,000. What could be more fair than every family earning $50,000. The free market here in the US could not operate under such restraints. A free market economy that follows the simple rules of supply and demand will operate almost on auto-pilot. It is an amazing thing to watch and see how millions of people making billions of decisions move the entire economy forward. The number one enemy of the free market is corruption and when steps are taken to minimize corruption the market does what it is supposed to do and that is provide opportunity for everyone. Corruption occurs with individuals, with businesses and with governments so what must be done to control it. Three things are needed. First and foremost is an informed consumer, second a critical and inquisitive press and finally elected officials who understand basic economics. In case there is some confusion as to what economics says about business, it is the following. The purpose of business is to provide goods and services and if done properly it will result in profit. Note, that unlike many people think, profit is not the purpose of business but the result of good business.

Weak or not

David Brooks a moderate conservative writer for the NY Times said in an interview that President Obama is viewed by some in the international community as weak. Other commentators have come to this conclusion and it is difficult to know what foreign leaders really think but you can see how they act. The Russian leader has made a move on Ukraine and China is threatening Japan and the Philippians. Sometimes how the President is perceived can influence the policy of countries around the world and I recall one situation with President Reagan that illustrates the point. Reagan fired the air traffic controllers because he felt they were breaking the law by threatening to strike. This was a very risky and bold move and many in hindsight think that it changed the way Gorbachev saw Reagan and put Reagan in a stronger negotiating position when he later sat down with a face to face with Gorbachev.

Green River

North Dakota has been in the news recently because of the Bakken Oil field where the estimated recoverable reserves are about 25 billion barrels. What is not reported is the Green River Formation that holds 1,500 billion barrels of recoverable oil. This is located in Colorado, Wyoming and Utah and is on government land. This is enough oil, based on current consumption to last 190 years. The Green River Formation—an assemblage of over 1,000 feet of sedimentary rocks that lie beneath parts of Colorado, Utah, and Wyoming—contains the world’s largest deposits of oil shale. USGS estimates that the Green River Formation contains about 3 trillion barrels of oil, and about half of this may be recoverable, depending on available technology and economic conditions. The North Dakota economy is booming with high paying good jobs and the state tax coffers are overflowing. This same thing could be happening in these other states if the government would open these areas to drilling. Our elected officials keep saying we need to grow the economy in order to provide more middle class high paying jobs and this presents a good opportunity.

Snowden

The recent news about the Pulitzer Prize going to papers who published the government activities revealed by Edward Snowden brought to mind the Pentagon Papers from the 70’s. For those too young to remember, Daniel Ellsberg , a government contract employee much like Snowden released information known as the Pentagon Papers that embarrassed the government. The government had kept a running account of the Viet Nam War which was much different than the information they were issuing to the public. Ellsberg felt it was his duty to reveal the truth and he did so. It was 1971 and the war was still in full swing so many thought it was treasonous but by that time the war had become very unpopular with the press and the public so not much was said about the treason part. During WW2 propaganda movies were produced and the government filled the press with inaccurate details of the war and if someone at that time had revealed the false information it would have been a different story. It is not the revelation of falsehoods that determine the degree of the problem but rather the kind of war that is involved. In WW 2 we welcomed propaganda and we needed it.

Keystone

In the great American tradition that a small vocal group can influence government we see the environmentalist doing their thing in regards to the Keystone Pipeline. Polls show that the American people favor the pipeline 64 to 29. In other polls environmental issues rank near the bottom of importance. Last year the senate voted 62 to 37 to approve the project. The government has agreed that it will not adversely affect the amount of CO2 in the air. A long-awaited State Department environmental report on the proposed Keystone XL oil pipeline indicates what the oil industry and its backers have been saying -- it won't have a big impact on carbon emissions that cause climate change. I believe the report should have gone further and explained the problems with not approving the pipeline. I say this because the oil is currently being used but it is shipped by rail to Alabama and then by truck to Louisiana. All this shipping is using up fuel and putting CO2 into the air. In addition shipping overland is more dangerous than piping. In addition the government is now requesting special shipping containers for this oil because it is more viscous than other oils and they deem this an additional hazard when in fact it is safer since it is much less volatile and would flow more slowly if a leak occurred Union groups are pushing for the approval since it will provide high paying jobs and a dozen democratic senators are asking for approval as it will improve the economy in their respective states. Since these environmental activist do not represent a large number of voters the question comes up as to why the administration wants to put this off until after the elections in November. Two theories have been put forth. One is that Warren Buffett has considerable financial interest in the railroads that haul the oil and the second is explained best by liberal billionaire Tom Steyer, a man who made his fortune by running one of those evil hedge funds, held a campaign rally in his home and it was attended by Senate Majority leader Harry Reed and Steyer said he would contribute 50 million of his own money and another 50 million from his friends to help defeat those are for the pipeline. He must be the liberal equivalent of the Koch brothers but Harry is not likely to mention that. If either of these theories have any merit it will just add to the mistrust that the people have toward government

Mama bear

Since the dawn of civilization up until the last 100 years, societies around the world have wasted half of their creativity by making women second class citizens. Since the start of the last century and more precisely the past 50 years this has changed, particularly in the United States. Today 60% of college students are women, more than half in Medical School, Law School and Graduate Schools are women. America, the greatest country in the history of the world is on the threshold of becoming even greater as these young women make their way into the world of business and government. They are filling the ranks of middle management and introducing innovative ideas on how to promote growth while putting the well-being of people at the forefront. There are only 23 female CEO’s in the top 500 companies but they are just getting started and the mama bear is coming, so you better get out of the way, because they will be changing the world.

Keystone

The State Department announced today another delay in the Keystone Pipeline. While these delays are going on the oil from tar sand fields of Western Canada is being shipped by rail to Mobile AL and then by truck to the Refinery in MS. This is not as cost efficient as a pipeline and it is less safe and more harmful to the environment. Are the environmentalist who oppose the pipeline aware of these shipments? The government announced new rules in February regarding the shipping of oil by rail and in particular shipping the heavy crude from Canada. Perhaps the environmental people have been working behind the scenes in efforts to curtail these shipments by influencing the EPA to issue these new regs.

Unions

There is a liberal web site called Media Matters and they are currently under petition to unionize their employees and they are resisting. I am reminded of my days working in at union plant in Ohio and in our plant we had a cafeteria. As a part of the contract negotiations the company agreed to turn over operation of the cafeteria to the union. They proceeded to hire employees to run the lunch room but they paid them only minimum wage and offered no benefits as they were all part time employees. The world view changes when the shoe is on the other foot.

Gore

One of the many things that citizens get upset about is corruption. The free market capitalist system has raised more people out of poverty than any government or any religion or any charity but the number one enemy of the free market is corruption. Most of the time people who are corrupting the game do not commit any crime but use money, power and influence to change outcomes. One recent case of note is former VP Al Gore. When Al was VP his estimated net worth was about 2 million. He took the money he got from the Noble Prize and using his influence convinced some friends to invest in green energy companies. Later his companies received money from President Obama’s green programs and within 14 years he turned his two million into 100 million.

Smoking gun

As the congress investigates the various so called scandals in the Obama administration the democrats complain that have investigated and found nothing. They say there is no White House involvement so the rest is just political. I have heard this argument before. It was in April of 1972 when a couple of guys broke into the Democratic Headquarters in the Watergate Hotel and it was not considered worthy for congress to investigate. In was only because two reporters continued to look into it that finally more than 2 years later the President resigned. During the first year of the investigation not much happened and the complaint from the Republicans was that this was all a political witch hunt and there was no there, there. Even after all the facts were made public President Nixon would not have been found guilty if it were not for the infamous tapes. Nixon in order to write his memoirs had installed a voice activated tape recorder in the oval office and these tapes revealed his part in the whole affair. It was the smoking gun. The same thing happened to President Clinton with the blue dress. It is difficult to tie the president to a crime without the smoking gun and presidents know this. It is what is meant by plausible deniability. People working directly for the president are expected to fall on the sword to protect him. It is akin to the blue wall in the police department. This is one of the reasons why presidents often seem to be in the dark on major issues.

Jobs

I start with the premise that most people would rather have employment than an unemployment check. If this is the case, what is needed to provide employment? The obvious answer is a growing economy. Jobs are created by business both small and large and by risk takers starting new businesses. To expand the economy we need lower taxes on business, fewer regulations on business and an optimistic attitude about the future. For the past few years we have been doing just the opposite. Taxes have been raised, regulations increase and polls show that people are pessimistic about the future. A good place to start is in the energy business where incentives to grow could be increased and regulations decreased. A poll came out yesterday about how the people of North Dakota feel about their future and they were filled with optimism. The primary reason for this is the boom in the oil and gas industry which provides good paying jobs, good profits and lots of tax revenue for the state. This could be happening all across the country.

Putin

There is a famous line that says, “Those who cannot remember the past are condemned to repeat it”. As Putin makes his move into Ukraine it is apropos that we review Europe between the great wars. Putin said he took over Crimea because there were Russians living there who wanted to rejoin the Mother Land. Now he is saying that Russians living in eastern Ukraine are being mistreated and is leaning toward going in to protect them. When Hitler came to power he took back land that Germany lost in the first war. He first took back an area known as Sarrland and then the Rhineland then Anschluss followed by Prussia. In these areas Hitler claimed that the Germans living there were being mistreated. Next he took Sudetenland and Austria saying the people there wanted to be part of Germany and each time Western Europe complained but nothing more. England sent Chamberlain to talk with Hitler and Hitler promised if he could have the rest of Czechoslovakia he would not take an any more territory and Chamberlain rushed back to England raising the document and declared peace in our time. Within months Hitler invaded Poland and the war began. Europe was exhausted after WW 1 and the people wanted nothing to do with war so they responded with words as Hitler expanded his empire. The same thing happened as Japan invaded Manchuria and then China. The League of Nations established to protect small countries from being invaded by more powerful countries did nothing. It behooves the world to pay attention to what Putin is up to.

Rich vs poor

Throughout history there have always been too few rich people and too many poor people and this has opened the door for unscrupulous individuals to use this discrepancy to their advantage, the latest example is Chavez in Venezuela. Typically a charismatic person comes in and promises the people he will take away the money from the rich and give it to the poor. He gains power and redistributes the wealth making sure to take a little extra for himself. Then he uses his power to grow into a dictator and in the end the poor people remain poor and often worse off than before. This type of political approach is called populism and people just keep falling for it because in most cases they are desperate. The Obama administration is using this approach by pitting the one percent against the 99 percent and it is working as it normally does. No one ever bothers to point out that there are not enough rich to make a difference. Even in America, the richest country in the history of the world, if we took all the income from the top one percent and gave it to the 99 percent we would each get $5,000. If we further refined the redistribution to giving money only to the lower half of the income spectrum, those who paid no income tax, they would still only get $10,000. It may make a good election year sound bite to say you are going to spread the wealth around but it is an old game that never really makes much difference to the poor. It has been tried many times and the poor always end about where they were.

NATO

The North American Treaty Alliance (NATO) is composed of 28 countries mostly European and they all rely heavily on the United States for their national defense. The burden of defending Nato’s 28 members falls increasingly on just one: the United States. Last year, America accounted for 72 per cent of Nato defence spending, up from 59 per cent in 1995. The total money spent on military around the world is about 1.55 trillion and the US spends 550 billion or about 44% of the total. The countries of Europe have the luxury of spending their money on government social programs as the US takes care of protecting them. Just one more example of American exceptionalism.