Don’t Forget The Last 8 Years, America

Today for the first time since April 14th 2008, John McCain has taken the lead in the average of the past week of National Polls in the U.S. Presidential Election according to RealClearPolitics.

This fact concerns me greatly due to the many domestic and foreign policy similarities John McCain has with the current U.S. President George Bush. John McCain is in the same political party as the President and voted with the President’s position 95% of the time in 2007.

During George Bush’s eight year administration we saw:

1. U.S. Debt Go Up: The U.S. National Debt increase from $5.7 trillion to $9.6 trillion (from 58% to 66% of the annual GDP).
2. U.S. Annual Deficit Go Up: A change in the U.S. annual federal deficit from a $125 billion surplus in 1999 and a $236 billion surplus in 2000 to a $412 billion deficit in 2004, a $318 billion deficit in 2005, a $248 billion deficit in 2006, and a $162 billion deficit in 2007.
3. Hurricane Katrina: 1,836 Americans die due to Hurricane Katrina, many of whom died to FEMA mismanagement before and after the storm under Mike Brown formerly the Judges and Stewards Commissioner for the International Arabian Horse Administration, from which he also was forced to resign.
4. A War on False Pretense: The invasion of Iraq based on incorrect intelligence that Iraq had weapons of mass destruction including yellowcake uranium that was known to be suspect at the time and sought out and used by Vice President Dick Cheney and Donald Rumsfeld to sell the war to the media, American people, and global community, which Colin Powell indicated later was “deliberately misleading.”
5. U.S. Deaths from War: 4,155 Americans die in combat in Iraq.
6. U.S. Wounded from War: Over 30,000 Americans wounded in combat in Iraq
7. Iraqi Deaths from War: At least 600,000 and as many as 1,200,000 excess deaths of Iraqi civilians since the July 2003 invasion (Source 1, Source 2, Source 3)
8. Revealing a CIA Agent’s Identity: The purposelful revealing of CIA Agent Valerie Plame’s indentity to the press by Dick Cheney’s Chief of Staff Scooter Libby, and the subsequent Presidential commuting of Libby’s prison sentence to a fine.
9. Suspension of Habeas Corpus: The unconstitutional suspension of the rights of Habeas Corpus including prisoners seeking relief from detention without trial.
10. Breaking of the Geneva Convention: The breaking of the laws of the the Geneva Convention, which was ratified as U.S. law, and the U.S. War Crimes Act of 1996 regarding torture in Iraqi prisons and the detainment of enemy combatants at Guantanamo.
11. Greenhouse Emissions Increase: The Kyoto Protocol, to which the U.S. is a signatory, never submitted for ratification, in part leading to higher carbon dioxide PPM to continue to increase, leading to faster increase in global temperatures, which is leading to sea levels rising and more frequent droughts and hurricanes
12. Osama Never Found: Osama Bin Laden never to be found, who is the founder and leader of Al Qaeda and the major architect of the September 11 attacks in New York, Washington, and Pennsylvania which caused the deaths of 2,974 people, 2,646 of whom were Americans.
13. Energy Prices Increasing: Gas prices increasing from a low of $1.04 in December 2002 to a high of $4.05 in June 2008 (from $1.45 at the beginning of the term in January 2001 to $3.66 as of September 1, 2008).
14. Rumsfeld’s Resignation: The hiring Secretary of Defense Donald Rumsfeld in the first Bush Administration, who responded to a question from a soldier about not having the right equipment and armor by saying, “You go to war with the army you have, not the army you want.”
15. Torture by U.S. Soldiers: The torture at Abu Ghraib prison, which included sodomy with a baton, urinating on a detainee’s leg, smearing feces on a detainee, forced masturbation, applying electric shocks to detainees, and jumping on a gunshot wounded leg.
16. The Decline of Veteran Care: The decline of Veteran Care at Walter Reed Army Medical Center.
17. Withdrawal of Miers Nomination: The nomination of Harriet Miers to the Supreme Court, who had never before been a judge and had very little experience with Constitutional Law at the time of nomination.
18. Resignation of Gonzalez: The appointment of Alberto Gonzalez as U.S. Attorney-General, forced to resign in 2007 after politically motivated firings of U.S. Attorneys, who in 2002 wrote an opinion that the Geneva Conventions prescriptions on torture did not apply to Taliban and Al Qaeda prisoners and in 2005 lobbied for the continuation of an illegal NSA wiretapping program targeting U.S. citizens without proper warrants.
19. U.S. Inflation Increase: The annual U.S. Inflation Rate go from 3.37% in January 2001 to 4.43% so far in 2008.
20. Unemployment Increase: The U.S. Unemployment Rate go from 4.2% in January 2001 to 6.1% today.

I’ll be posting more about my current views on the policies and the candidates leading up to the election.

Where I Am Coming From

For the sake of sharing where I am coming from, I am registered as an Independent and am a businessperson and entrepreneur from North Carolina. My father was an Episcopalian priest and my mother was a social worker. I am a fiscal conservative who believes in efficient government and cares about equality of opportunity and helping others. Please feel free to comment. Facts and discussion of policy and issues is very welcomed.

Sustainable Capitalism and The Role of Aid vs. Trade in Prosperity Creation

I picked up a glossy investment prospectus from a firm called Legatum Group at up at the Fortune Brainstorm Tech conference today. A statement inside caught my eye. It stated:

“While aid can play an important role in alleviating immediate needs, its impact is naturally limited since it is neither sustainable nor scalable.” Seperately, it states, “Quite distinct from the limited scope of charitable initiatives, businesses are both self-sustaining and scalable. Legatum directs its attention towards promoting entrepreneurship and business for all its social benefits within developing communities.”

I wanted to to take a chance to think more about the nuance of the right type of aid vs. the right type of trade and investment.

I feel presently that the answer to reducing poverty and increasing access to opportunity and prospectity in developing nations is three fold. The answer is A) for-profit private capital investment into sustainable companies that are socially responsible (or at least not socially irresponsible) AND B) direct “aid with standards” to community-based non-profit organizations run by local social entrepreneurs that are efficiently serving the needs of their communities AND C) efficiently run transparent government that creates and protects a system of law and property rights.

The question that should be asked cannot be as black and white of aid vs. trade. It’s not aid OR trade. It’s accountable aid AND sustainable trade AND efficient goverment. It’s a public/private/community partnership that does not succeed without participation from each sector. The questions that we as a society should be asking is how to make direct aid measurable and accountable AND how to make trade and investment sustainable AND how to make government efficient and transparent.

These methods of human and capital investment are on the spectrum of socially responsible venture philanthropy that builds human capital, infrastructure, and standards of living through education, medicine, nutrition, and technology that enables us to do more with less resources. At the end of the day–all private sector and public sector investment should come back to efficiently serving the needs and desires of the local population in a sustainable manner.

What the answer to prosperity creation seems not to be is the traditional bi-lateral government to government aid (read: loans that local populations will have to pay back to buy our stuff from our companies) nor traditional private capital investment in companies that are not socially responsible and end up hurting local environments. This of course is the very common and very key “aid vs. trade” question that so many like Sachs, Easterly, Collier, Stiglitz, Pralahad, and Gates have debated.

So what is the import of this debate and why is a tech CEO talking about it? The great war of ideas of the 19th and 20th Century between pure communism (total state control of the economic sector) and pure capitalism (total market control of of the economic sector) is giving way to an “end of history” state that could be simply called “Sustainable Capitalism.”

Sustainable Capitalism could be defined as a state in which competitive market economies that are based on environmental sustainability, democracy, transparency, communication technology, an educated populace, and a government with a limited but very important role in setting the rule of law, thrive while efficient social entrepreneurs with services that produce a public good are invested in with capital with measured returns and public servants integrate the same communication and ERP systems of the best-run companies in the world.

In this new Zakarian model of economic system, companies that destroy the environment, provide a negative net benefit through off-balance sheet externalities, or exploit their populations are video blogged and written about and pressured through market forces to reform or wither. This is perhaps somewhat idealist today–but it is the path I believe we are on. The fact that all companies must be sustainable soon enough for the system to scale and prosperity to be possible for all humans is clear. This trend will accelerate as we enter into the coming age of ubiquitous broadband and improved technology of the citizen blogger and as resources become less available. Governments, non-profits, and businesses will have a much higher level of accountability. This assumes of course people have incentives to work toward shared prosperity that can continue beyond the short-term, and I think that is a fair assumption and a vision shared by the global connected youth of today that I know.

What’s the common denominator for human invesment in either the public or private sector? Return on invested capital, as long as the definition of return is broadened to include social returns and the definition of cost is broadened to include environmental degradation. This is the Net Domestic Product (NDP) approach versus the Gross Domestic Product (GDP) approach.

So am I criticizing the Legatum brochure statement? No, not really–I just hope they share the belief–and I am sure they do–that prosperity in the developing world and continued sustainable improvement can only be possible if we find methods to enable entrepreneurs, social entrepreneurs, and public service entrepreneurs to transparently, efficiently, and sustainably make investments that maximize individual utility, return on investment, and the public good.

The effort toward sustainable capitalism and efficient government requires an improved ability to communicate, collaborate, and measure results. There’s a digital generation of entrepreneurs and social entrepreneurs that gets this who will be the global leaders sooner than you might imagine.

Building Bridges Across the Atlantic

What’s up, what’s up. It’s Sunday at 3:34am but I feel like I’m still on EST. I’m over in Berlin this weekend doing some analysis of the usage of email marketing in German small businesses and attending a pretty cool conference put together by the a group called the British Council.

They’re calling it Transatlantic Network 2020. They’re basically bringing together 100 people from N. America and Europe for each of the next 12 years until 2020 to build relationships among future world leaders from the NATO countries between 23 and 36 years old. 2008 is the first year of the program.

The attendees are off the heazy. The 15 or so U.S./Canandian participants got together tonight at 6 in the hotel bar and then we headed off for dinner at a biergarten and had the traditional bratwurst, sauerkraut, and potatoes.

I met some mad smart people tonight–including social activist Jeff Johnson from BET, Washington Post “How the World Sees America” blogger Amar Bakshi, NASA public affairs specialist Stephanie Schierholz, Bethan Jenkins, a 26 year old Welsh Parliament member, and David Kirby from America’s Future Foundation and KSG at Harvard where’d I’d love to be at in a few years.

It’s wonderful to have a dinner in which we can get wide-ranging perspectives on topics like ice cap melting, microfinance, U.S. space program research, asteroid path projections, bilateral aid inefficiency, fuel cell physics, U.S. rural poverty, nationalism vs. internationalism, global health, genocide, the role of colonialism and Nation-State border creation in global poverty, Barack Obama’s triangulation of internationalism, government efficiency, and social liberalism, and the degenerative devolution of hip hop since Dr. Dre’s Chronic album in 1992.

I can’t wait until the outlook and ideas of the participants from Germany, Greece, Ireland, Italy, France, Scotland, Portugal, Poland, Spain, Romania, The Netherlands, N. Ireland, England, and Turkey are added tomorrow.

The other cool thing that keeps happening is that I keep running into iContact customers wherever I go. I ran into three our four while speaking at Metro State College in Denver on Thursday and here at the conference David Kirby from America’s Future Foundation uses iContact to send newsletters to the supporters of his non-profit. Word is spreading.

We just got back from a dance club called Tresor in a former communist-era power plant in East Berlin that seemed to just be getting started at 3am when we left. Man it’s harder to dance to techno than hip-hop, especially with the unvarying/long beats of underground Berlin trance.

Tomorrow afternoon we’ll be meeting the European participants and doing a guided walking tour of the city. The main conference runs from Mon-Wed.

If you are interested in being considered for the Dublin Transatlantic 2020 Conference in September check out their site and contact Jacqui Allan.

From their site:

ABOUT THE PROGRAM
Transatlantic Network 2020 (TN2020) seeks to create sustainable, multilateral networks that span the Atlantic by engaging future leaders from North America, the UK, and the rest of Europe to collaboratively address global issues. Building on the history and shared values of the transatlantic relationship, the program aims to foster long-term relationships among future leaders and to incite grassroots action on important global issues. It is designed to run until 2020.

WHY FOCUS ON THE TRANSATLANTIC RELATIONSHIP?

North America and Europe share a common set of interests – in the advancement of fundamental rights and liberties, education, science and technology. Reports indicate that North America and Europe need to strengthen the transatlantic relationship and work together more closely to best tackle global issues like climate change, immigration, and security. TN2020 will foster collaboration between the next generation of North American and European leader

HOW WILL THE PROGRAM WORK?

TN2020 will feature initiatives that give a voice to the next generation of leaders on both sides of the Atlantic, encouraging them to work together to explore common solutions to current and future global issues.

How selfish soever man may be supposed…

I just sent this to a couple of my friends and wanting to blog it as well. I just watched the video of the much-talked about Gates speech on Creative Capitalism on Friday at Davos. For me, it was one of the most inspiring and influential speeches I have ever heard. Though Gates is not the best speaker in the world, his message is right on. The WSJ article on the speech is here and the video of the speech is here.

I especially enjoyed the Adam Smith quote Gates references:

“How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortunes of others, and render their happiness necessary to him, though he derives nothing from it, except the pleasure of seeing it.”

Here’s an excerpt from the speech transcript:

In many crucial areas, the world is getting better.

These improvements have been triggered by advances in science, technology, and medicine. They have brought us to a high point in human welfare. We’re really just at the becoming of this technology-driven revolution in what people can do for one another. In the coming decades, we’ll have astonishing new abilities: better software, better diagnosis for illness, better cures, better education, better opportunities and more brilliant minds coming up with ideas that solve tough problems.

This is how I see the world, and it should make one thing clear: I am an optimist.

But I am an impatient optimist. The world is getting better, but it’s not getting better fast enough, and it’s not getting better for everyone.

The great advances in the world have often aggravated the inequities in the world. The least needy see the most improvement, and the most needy get the least — in particular the billion people who live on less than a dollar a day.

There are roughly a billion people in the world who don’t get enough food, who don’t have clean drinking water, who don’t have electricity, the things that we take for granted.

Diseases like malaria that kill over a million people a year get far less attention than drugs to help with baldness.

So, the bottom billion misses the benefits of the global economy, and yet they’ll suffer from the negative effects of economic growth they missed out on. Climate change will have the biggest effect on people who have done the least to cause it.

Why do people benefit in inverse proportion to their need? Well, market incentives make that happen.

In a system of capitalism, as people’s wealth rises, the financial incentive to serve them rises. As their wealth falls, the financial incentive to serve them falls, until it becomes zero. We have to find a way to make the aspects of capitalism that serve wealthier people serve poorer people as well.

The genius of capitalism lies in its ability to make self-interest serve the wider interest. The potential of a big financial return for innovation unleashes a broad set of talented people in pursuit of many different discoveries. This system, driven by self-interest, is responsible for the incredible innovations that have improved so many lives.

But to harness this power so it benefits everyone, we need to refine the system.

As I see it, there are two great forces of human nature: self-interest, and caring for others. Capitalism harnesses self-interest in a helpful and sustainable way, but only on behalf of those who can pay. Government aid and philanthropy channel our caring for those who can’t pay. But to provide rapid improvement for the poor we need a system that draws in innovators and businesses in a far better way than we do today.

Such a system would have a twin mission: making profits and also improving lives of those who don’t fully benefit from today’s market forces. For sustainability we need to use profit incentives wherever we can. At the same time, profits are not always possible when business tries to serve the very poor. In such cases there needs to be another incentive, and that incentive is recognition. Recognition enhances a company’s reputation and appeals to customers; above all, it attracts good people to an organization. As such, recognition triggers a market-based reward for good behavior. In markets where profits are not possible, recognition is a proxy; where profits are possible, recognition is an added incentive.

This week’s Economist had a section on corporate responsibility, and it put the problem very nicely. It said it’s the interaction between a company’s principles and its commercial competence that shape the kind of business it will be.

The challenge here is to design a system where market incentives, including profits and recognition, drive those principles to do more for the poor.

I like to call this idea creative capitalism, an approach where governments, businesses, and nonprofits work together to stretch the reach of market forces so that more people can make a profit, or gain recognition, doing work that eases the world’s inequities.

Some people might object to this kind of market-based social change, arguing that if we combine sentiment with self-interest, we will not expand the reach of the market, but reduce it. Yet Adam Smith, the very father of capitalism and the author of “Wealth of Nations,” who believed strongly in the value of self-interest for society, opened his first book with the following lines:

“How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortunes of others, and render their happiness necessary to him, though he derives nothing from it, except the pleasure of seeing it.”