The Loyalty Problem

I think this country, perhaps the world, has become so dysfunctional because we forgot how complex the concept of loyalty can be. It seems a simple and unambiguous word. “Loyalty” is basically defined as: “the quality of giving or showing firm and constant support or allegiance.” In these last years I believe we have paradoxically become more loyal, but with too little thought or consideration of the recipient of our fealty, whether this be a person, institution, or idea.

Today’s more intense loyalty has come at the expense of judgment. Loyalty was never a substantive virtue alongside wisdom, courage, justice, and temperance. Loyalty requires prudence and vigilance in our assessment of the object of this support.

Blind and unconditional loyalty is unhealthy to relationships, families, leaders, institutions or causes because it removes judgement. Circumstance must guide decisions to be loyal. This is not easy work, it takes understanding, deliberation, evaluation, and study; it requires nuance. We must ask “what is the effect of my loyalty to this or that?” Remember, it is not true that good leaders foster intense loyalty, they inspire and promote principled behaviour. It is the bad leader who stresses loyalty above all else.

Context must be used in the calculus of “where does my loyalty lie?”  This isn’t hypocritical, it is moral, and it requires inner conviction. By way of example, on a small issue or minor piece of legislation a congressman or congresswoman might vote with his or her party; however, he or she should not thoughtlessly have allegiance to party for a destructive major legislative initiative or for entering a badly thought out foreign intervention. A worker might let a minor misbehaviour go but not a systemic fraud. Loyalty without context is idolatry. Loyalty without context has given us tyranny over the ages.

Bad leaders and corrupt institutions enforce loyalty over morality. Sadly, loyalty has become binary in our country today. James Carville, the acidic pundit, has said you can’t be loyal to us without “stickin’” it to them. In current times when a politician, educator or your neighbour tries to be non-binary, they are trashed as traitor by their side and unprotected and exploited by the opposite side.

We have been on this slippery slope for a decade or more, so this conduct has become normative. Partisanship is not the problem; it is the symptom of loyalty gone awry. We need to get our loyalties back to a healthy state. We all need to speak up, teach our children, talk with friends of different persuasions, and call out loyalty tests as malign. Whistleblowers need protection not disparagement.

Re-examining our concept of loyalty will go a long way in bringing back a more civil society.

 

"The Apprentice" 2.0

 

Donald Trump is a narcissist and emotionally unhinged, but in my opinion, he is very much a calculating individual. I think the President is confident he will lose the election and is now auditioning for his next act – producing a pilot if you will. The debate was his demo reel.

Think about it. If he were truly seeking re-election, even he would make a bit more effort to woo the undecided. But in the last month or two, Trump has done the exact opposite. He hosts super-spreader rallies, fails to condemn the violence of far right groups, mocks the CDC, the FBI and the FDA, continues with the unsupported claims of election fraud – the list goes on. He has turned up the rhetoric exponentially pandering to the base, not even disavowing Proud Boys while on stage. Watching the debate, he is cunning. This is not political Tourette’s Syndrome; this is a man honing his act, trying to make his future audience love him.

I think Trump’s calculation is that he can land on his feet and create a more virulent “Apprentice” vehicle, married to the “Bannon-sphere,” well to the right of Fox. Sadly, there is an audience: the 30-35% of ardent MAGA worshipers.  Trump’s only real commercial success was that of entertainer and promoter, bringing in almost $500 million with “The Apprentice” and it’s merchandising. He desperately needs a second act because he is deeply indebted. I’m sure the new gig will be a blockbuster for him; and continue to sow discord well after his term ends. I do not think he is ideological. His first and foremost concern is his self-interest. He does not have a “True North.” Trump is counting on a reincarnation to bail him out. That’s his game plan; country be damned. Let’s see what happens. 

I wonder what the name of the new show will be. I have a suggestion: “A ME RICA”.

Biden's Bridge

 Joe Biden, born November 20, 1942, is less than seven years older than me. Yet he seems of a different generation. Pondering this a bit more, I realize that Biden is not technically part of the Baby Boomers (1946 – 1965), as am I.

Biden is in the tail end of the Silent Generation, a small cohort within the birth years of 1928 – 1945. Parents of the Silent Generation were in the Greatest Generation (1901 – 1927); these mothers and fathers had lived the Great Depression and the World Wars. Biden exhibits an echo of his parent’s generational attitudes. He was of the time before meritocracy fully took hold of us, leaders were more humble stewards of position and power; perhaps feeling less entitled and less confident.

Our last four presidents, Clinton (born 1946), G.W. Bush (1946), Obama (1961) and Trump (1946) have been Boomers, governing for almost three decades (1993 – 2020). Of late, much of the progress and achievements of these Boomer governments have lost their lustre. More than a touch of hubris has been exposed.  The last of these, Trump, was a gargoyle of Boomer privilege, laying waste to his inheritance and making a mockery of merit.

Biden somehow comes across as “older”, with more grounded experience than I think I have. But this doesn’t really make much sense. Only 8% of living Americans are older than me; Biden’s percentage is 5%, so not a big difference. There must be something else at play. It is also no coincidence that the runner up for the nomination is also a Silent Generation member, Bernie Sanders, born in 1941. Please know that I’m not wishing to give the Silent Generation sainthood; they had their sins: segregation, misogyny – and let us not forget Vietnam. No rose coloured glasses are being worn.

But here is my point. Many studies have found that crowds have a certain uncanny wisdom, and we may be seeing this play out in the current election cycle – I hope so. Perhaps Biden is the bridge connecting the past Silent Generation’s humility and art of compromise with the hopes and dreams of the younger voting cohorts of late Boomers, Generation X, Millennials and Generation Z. Maybe this election is about slowly moving us sixty and seventy year olds out of the picture, and out of power. 

I’m hopeful that Biden and Harris put together an idealistic yet grounded group of smart younger people to find fresh solutions to climate, China, race, gender, and income disparity. I’m happy to put the last years of my life into their hands as they create a better future.

But first, let’s defeat Donald Trump on November 3.

High Crimes...

Within the impeachment debate, a Trump refrain has been “where was the crime?” After all, what damage was really done? Volodymyr Zelansky got his White House visit and Ukraine got its aid and javelin rockets. Clearly, this is a Hoax, a Sham, a Witch Hunt!

But what if the President and his agents were not so inept? I’m a fan of the alternate history genre (think “Fatherland,” by Robert Harris), so let me spin an alternate outcome here.

Suppose the plan to damage Biden was more clandestine; professionally planned and executed, the call was never made or successfully buried, and Trump had more loyal forces installed in the State Department and in the ambassadorial ranks. What if the whistle blower never materialized? What if Trump didn’t make the stupid decision to resurrect the debunked 2016 Ukrainian election interference plot and add it to the soup. Or what if the quid-pro-quo was delivered quietly and without a trail by a trusted confidant.

Could we have then seen a credible new Ukrainian president, who had run on an anti-corruption platform, hold a convincing news conference on CNN, strategically timed before the Iowa caucus. Zelansky soberly announces as part of his broad corruption investigation, a serious inquiry into Hunter Biden, Burisma Holdings, and by association, former Vice-President Joe Biden. No one ever discovers any fingerprints of the Trump administration’s shakedown of Ukraine.

Biden, already stumbling in Iowa, comes in a distant fifth place, with no clear winner. Leading up to Super Tuesday, Russia and fringe-right groups spin a brilliant digital campaign that keeps the Burisma issue alive. Warren and Sanders join in the questioning in order to bolster their chances; and the Trump administration’s blunders and missteps move to page two.

The Democratic Convention opens in Milwaukee on July 13th with no presumptive nominee, chaos ensues; however, Biden is finally confirmed on the third round of balloting. Very little time is spent on Republican policy failures in the first term.

On January 20, 2021 Donald Trump strides to the podium for his second inaugural address. In the campaign, Biden continued to be dogged by Ukraine and a proposed Senate investigation that never actually took place. He won the popular vote but lost in the electoral college.

It turns out that Trump was very much like Ray Winkler in Woody Allen’s hit “Small Time Crooks.” But what if he were a bit cleverer and more sinister? Trump could also have been the Keyser Soze character in Bryan Singer’s “The Usual Suspects.”

High crimes and misdemeanors are still high crimes and misdeneanors regardless of the outcome. They should not be judged by the success or failure of the illicit act. An alternate history in this recent incident with the Ukraine could have been quite grave to our democracy and our nation - and we might never have discovered it.

This is precisely why impeachment was the appropriate course of action.

Poor President Trump

Since Donald Trump announced his candidacy and through becoming the 45th president of the United States I have had one overriding question. Is this a man “with a lot to lose” or one “with nothing to lose?” What follows is pure supposition, perhaps my intuition kicking in from being around characters like President Trump over my many years in real estate, and the automobile dealership business. Many of these folks were very much like Trump: loud, aggressive, sure of themselves, vain, narcissistic, misogynistic and tribal. And let us not forget egotistical!

To further explain I need to regress a bit, so bear with me. Financial wealth is defined as your net worth; your assets (what you have) minus your liabilities (what you owe). In life, we see only a person’s assets (what they have); liabilities are usually pretty invisible. By way of example, two persons might each have a net worth of $10 million. “Person One” might have a $10 million home with no mortgage; “Person Two” might have a $100 million home with a $90 million mortgage. “Person Two” will look much, much wealthier to the outside world than “Person One.”

My hunch is that President Trump is more like “Person Two.” If I’m right, it could explain lots of behavior – especially because President Trump’s outsized ego makes the average captain of industry’s ego look puny. I’m guessing that the Trump family is in the top one-tenth of one percent; but not close to inclusion in the top one-thousandth of one percent (in the US, roughly 1,600 households).

Trump has spent his life trying to be a member of this club, and has done a magnificent job of pretending he has succeeded. I’m sure his biggest fear is being found out. He probably has taken many outsized, dangerous gambles (with some failing disastrously) to secure a seat in this oh so exclusive cohort. And with each failure, his liabilities have increased. If this is true, it explains a lot:

·        Not releasing tax returns was not because he didn’t want people to see how rich he was; rather the opposite. It would expose his lessened status so he fought this to the bitter end.

·        His business interests are non-public and tribal; with governance and accounting managed by seemingly unqualified people and outside firms (think Madoff).

·       A string of bankruptcies ruining thousands of lives.

·      Aggressively litigious behavior with hyper reactions to threats on privacy or reputation; heavy use of non-disclosure and confidentiality agreements.

·        Associations with Russian and other opaque characters. He could not use traditional banking or public credit markets – these institutions would not lend to him. These shadowy types were willing to provide financing to Trump and his enterprises in return for laundering funds, industry access and since Trump’s political ascension, governmental contact and influence.

·        Naked use of government associations to further Trump family interests. This is truly a low point in peddling influence for personal enrichment in the highest office.

·        Support of controversial single-interest policies. These policy lobbies were a source of campaign funding and political cover during the election and then bled into the administration’s cabinet picks and policies. If Bloomberg, Buffet, Gates or one of the Koch brothers ran for the highest office, would they be going hat in hand this way?

Over the years, some Trump-like people turned out to be very, very wealthy – truly rich and truly lucky. Others seemed so for some period, but ultimately their penury came to light. Robert Maxwell’s story in the 1990’s is a good example.

Maxwell, a media magnate and British member of parliament, led a flamboyant lifestyle, buzzing around in his helicopter and sailing in his luxury yacht, the Lady Ghislaine. He was notably litigious and often embroiled in controversy. In 1989, he had to sell successful businesses, including Pergamon Press, to cover some debts; and in 1991 his body was discovered floating in the Atlantic Ocean, he supposedly had fallen overboard from his yacht. After his mysterious death, huge financial discrepancies were uncovered, including his fraudulent misappropriation of hundreds of millions of Pounds from the Mirror Group’s Pension Fund. All of Maxwell’s companies were later declared insolvent.

So, back to the answer to my query. I think President Trump, like Maxwell, is a person “with nothing to lose.” He has and still is betting it all to show the world he is a member in good standing in the club he so covets. Combine this overriding passion with his lack of moral compass and the rest of us “with a lot to lose” have much to worry about. I think this passion, this fear of losing, drives this man more than anything else. This makes him perhaps the most dangerous man on earth.

Our Emperor

Our emperor may have no clothes, or more aptly, no cash.

Time to Go

I’ve decided to clear some chips in the equity markets, and bring my stock holding to below fifty percent of my asset allocation. Shiller’s cyclically adjusted price to earnings ratio (CAPE) is flirting with 30; similar to levels before the 1929 crash and the 2000 Internet Bubble. I’m most likely early in reducing my exposure. But we will see a big adjustment at some point; at least 25%, probably 40%, maybe more. Federal debt is by most measures 100% of GDP, corporate earnings have been flat or down if one accounts for the massive buyback programs underway. Demography is another downward drag.

Populism is approaching “full bloom” worldwide; it has its name, in fact, because during certain periods the crazy policies it expounds are “popular.” These governments could last five years, perhaps a decade if one looks at history. But history also tells us that the longer they last, the more pain and tears there will be.

Sadder still is what this is doing to society, by that I mean “all of us.” The populists’ playbook is pretty well set: define a majority group of “us” who are the good stock, blame those not it this group for the current troubles, propose some simple solutions to the problems, denigrate expertise of any stripe, discredit the press and the courts; and finally, declare victory.

We have populists in Asia, Europe and America. Turkey’s Erdogan seems to have won yesterday’s referendum to greatly expand his powers. I have heard Erdogan compare democracy to a tram: “You can leave it once you reach your stop.”

There doesn’t seem to be a credible rebuttal to this bout of populism; again, history tells us that these movements run their destructive course until conditions deteriorate enough to uncover the fraud and fallacy of the philosophy and the policies. Hopefully this happens before too many bad things happen; and that our institutions remain solid enough to manage the rebuilding process.

As someone once said: "Cash pays nothing but it's looking pretty good." So, I’ve reached my stop – selling will begin tomorrow. This is painful – 23.8% capital gains taxes are nothing to which to trifle; as much as an 8% drain on total sale proceeds for me.

But these times will pass, I’m hopeful for my kids and grand kids. And at some point, stocks will go on sale again, like in 2008 and 2009.

   

Stay Calm, "But Don't" Carry On

These first days of the Trump administration have been amateur hour for sure. But Democrats are making a mistake by mimicking some of Trump’s theatrics and demeanor in their responses. We are in serious need to have at least some adults in the room. Thus, my advice in these first 100-days is for the Democrats to look to a “twist” of a timeworn British saying: “Stay Calm, But Don’t Carry On.” We have plenty of children acting out, we desperately need some cool and grownup behavior.

Democrats and others who did not vote for Trump are not primarily to blame for the election result. The Republican primary process and the weaknesses of alternative potential nominees delivered us President Trump. The establishment’s lack of understanding of the seething frustration of many, many citizens delivered us Trump.

Trump will hurt us all, but he is first and foremost a Republican problem. Establishment conservatives and their surrogates have made a Faustian bargain in their effort to control the White House. They now have as their leader a hedonistic, anti-trade, ethnic nationalist, and Peron-like corporatist. Not exactly bedrock conservative ideals.

Democrats through their hyperbolic responses over these last few days provide cover for the Republican moderates. In effect, the Democrats are saying what the Republicans would eventually be required to say. Democrats should stop carrying on and start looking and acting like a more grown up and responsible opposition. No one will listen to their criticism except fellow Trump haters. If McCain, Graham, Collins and Ryan and others have to say it; eventually it might sink in.  

Trump’s cabinet nominees are going to be appointed eventually. Democrats should have presented polite, critical counterpoint at the hearings; setting up the record for later use. Instead, they behaved badly and ineffectually with a boycott of Mnuchin’s and Price’s confirmations for Treasury and HHS respectively. It was a useless and distracting tantrum; not showing an alternative demeanor to the Republican’s chronic obstructionism while they were in the minority. It only fueled the invincibility of the Trumpians. The same will follow on the nomination of Neil Gorsuch for the Supreme Court. Is he perfect; surely no, but generally continues the status quo of Antonin Scalia. Sure, it was unconscionable for the Republican’s to block Obama’s constitutional prerogative of appointment for almost a year; but will it do any lasting good to behave uncivilly? Extreme obstructionism will not work.

For Democrats, this should be a time for proportionality and reality in their response to Trump. If things go as they seem, Congressional Republican leadership will eventually abandon their Faustian devil. If Democrats smartly do not take the bait, it is the Republicans that will eventually rein in all the destructive policies and tendencies of the Donald.

Public demonstrations and the press can provide the emotional energy; the Democratic leadership must be calm, smart, grown up and strategic.

But Democrats also desperately need a fresh, new voice – think of the early Barack Obama. Trump’s message is fear, isolation and bravado. Democrats need to harness hope, access and confidence with a new communicator in this digital age.

 It’s the long game Democrats should be thinking about, not the pettiness of the day. We potentially have four years “to carry on”, but if the conservatives and the country have their fill, perhaps Article 2, Section 4 of the Constitution will come to the rescue before then.

Fear and Uncertainty

The circus of the Republican National Convention is now over; not a picture perfect example for the man that purports to know how to manage things and that says confidently “I’m, like, a really smart person.”

It is perplexing that America is in pretty good shape relative to the rest of the world; yet there is so much angst. Many explanations are out there: globalization, income inequality, lack of mobility, family breakdown, terrorism, moral relativism; the list goes on. This blog is not meant to get into this very important “why.” Rather it is to look to the future with a large degree of fear and uncertainty.

I have written in an earlier blog about “Dangerous Times.” All over the world, inexperienced populists with illiberal inclinations have been elected as “saviors” against some villainous “other.” But in the United States, we seem have taken things one step further. I am distressed for our future.

So using more of Mr. Trump’s words: “Let me dumb this down for you so much that it no longer makes sense.”  Two big perils have been occupying my mind.

First, there is possibility that for the first time since 1825, no candidate will receive the now needed 270 electoral votes to become president. Both Hillary and Donald are not well liked. Pew’s latest poll has only 43% of Democrats “very or fairly happy” with their candidate; the Republican number is lower at 40%. The majority of Republicans, 50%, are voting for Trump “as a vote against” Clinton; the Democratic number “as a vote against” Trump is 55%. The last time these numbers were in this range was in 1992; think Ross Perot getting 19% of the popular vote.

The Libertarian Party is fielding credible candidates in Gary Johnson and Bill Weld. With the Green Party, these alternates are already polling as high as 15%. If Johnson manages to get into the televised debates, this number may go up further. Remember that Ralph Nader most likely lost the election for Gore in 2000 with just 3% of the popular vote.

If we have no winner in the electoral college; the House votes among the top three candidates; each state getting one vote. But since many sparsely populated states in the West are conservative and Republican, it is likely that a close election would go to Trump. This might happen even if Hillary Clinton got the highest popular vote by some nontrivial margin. How would this play out with a disgruntled Democratic plurality? What would our streets look like on Inauguration Day 2017? We might look back to the turmoil of Bush-Gore “hanging chads” with nostalgia.

Second, Trump may win and what kind of government transition might we see. In “the Donald” we have a toxic mix of ego and amateur. Trump has never held a public office, has never been a serious student of public governance, has shown an astounding ignorance of public policy detail, jokes about his lack of knowledge of foreign affairs and has probably insulted more heads of state than Boris Johnson. Many experienced public figures have already rebuffed his advances; just look at how far down the roster he had to go to field a vice-presidential running mate. Many of the brightest will not participate in his administration.

Brexit has given us a taste of unintended consequences; and its current honeymoon period is a calm before the storm. The “Economist” has published a slightly tongue in cheek fictional account of Trump’s “First Hundred Days." 

Here is a link to this piece: http://www.economist.com/node/21701933

I urge you to take the time and read it.

As with the United Kingdom, we have enough problems without self-inflicted wounds. I hope America can come to its senses and pick the less damaging, less risky candidate, Hillary Clinton. But I am saddened that this is the dearth of our choice. For me, Hillary is at worst lacking authenticity and a deeply ingrained moral compass; and at best, fails by not being able to exhibit them to the voters.

Fear and uncertainty lie ahead of us, which in and of itself will make things worse.

Dangerous Times

My life straddles the Atlantic, one foot in America and the other in Britain and Europe. Because of this, I get to see politics unfold at close range in each spot. Although on the surface there seems to be no theme; actually I think there is a disturbing one.

In a recent piece in the New York Times, David Brooks talked of a widespread “anxiety of impotence.” A large majority of people feel they are powerless. As Brooks writes: “The Republican establishment thinks the grass roots have the power but the grass roots think the reverse…The unions think the corporations have the power but the corporations think the start-ups do. Regulators think Wall Street has the power but Wall Street thinks the regulators do.”

This feeling of helplessness is creating dangerous political trends among the opposition parties, and those former opposition parties that have now come to power. In America, the opposition Republican Party is splintering into the “Trump/Cruz” crazies and the increasingly defensive traditionalists. It is hard to see a reconciliation happening in the next few months. Similarly in the United Kingdom where the Labor Party is in opposition, the far left “Corbynistas,” lead by Jeremy Corbyn; is alienating the party’s more mainstream New Labor “Blairites.” Even parties in power are having insurrections. Bernie Sanders is sniping from the far left in the Democratic Party in the United States; Nigel Farage’s far right UKIP haranguing the Conservatives in Britain.

 This “anxiety of impotence” creates a desire for a “savior,” and there are many firebrands lining up for the job. Their strategies have one common thread; create a villain. For Trump it is the incompetence of the political elite, or alternately Muslims. For Cruz it’s Washington insiders. Bernie blames Wall Street; Corbyn, capitalism. The targets around the world include many minorities: Blacks, gays, apostates, crusaders, the “West”, or the “one percent.” Any “other” that taps into the underlying alienation will do. Institutions are also in the frame: the EU, the UN, or the Supreme Court.

Saviors promise quick solutions to simple problems. Unfortunately our current challenges are not simple problems caused by some bogyman; they are a function of displacement by technology, globalization and poor education. Quick fixes are therefore an illusion, albeit alluring to a disgruntled populace.     

Europe may give us some insight as to what might be heading our way in America and Britain: Hungary’s Victor Orban, Turkey’s Recep Tayyip Erdoğan; Russia’s Vladimir Putin and most recently Poland’s Jarosław Kaczyński. These leaders are elected saviors – all very popular and each has told their people who is the bogyman and that the solutions are simple. These regimes have given rise to a new term: “illiberal democracy,” coined by Fareed Zakaria in 1997.

Princeton’s Jan-Werner Mueller insightfully challenges this label in a recent blog on “Project Syndicate.” There is no place for the word “democracy” in the description of these governments. A more descriptive phase would be “illiberal authoritarian.” In every case, under the cover of some vague populist rhetoric, national courts have been packed or muted, the media muzzled and minority opposition squashed.   

In early 1918, Mussolini called for the emergence of a man "ruthless and energetic enough to make a clean sweep" to revive the Italian nation. Fascism was born and plagued the world until after World War II.  I am very worried that our “anxiety of impotence” might usher in some form of populist neo-Fascism for much of the world. This will not solve our problems, merely complicate them. And in the process cause untold misery on many a minority - careful, you might be one of them. 

What If Bukharin Won and Had "Big Data"?

I have been fascinated by economic systems since my college days. At that time, the late sixties, the West was in a very similar funk about itself as it is now. There was a fascination with hybrid economic systems blending laissez faire capitalism with central planning; individual freedom balanced against collective welfare.  Yugoslavia was the “darling” to be studied at this time; its ten year GDP growth (1961 – 1970) was estimated at 5.5% per annum. The “USSR” (Union of Soviet Socialist Republics) was also in the frame of study.

But why the title: “What if Bukharin Won and had “Big Data”? This requires a bit of historical background. As the Russian Revolution was winding down in 1922 after five years of bloodshed and deprivation, Lenin was trying to patch together the communist utopia. Pragmatically, he relaxed the nationalization of production that had occurred in War Communism and introduced a somewhat mixed market system dubbed the NEP (“New Economic Policy”). Reluctantly, Nikolai Bukharin, a rather brilliant theoretician, economist and party luminary, came around to this thinking and became its chief exponent. By 1925, the Russian economy was turning a corner, industrial and agricultural production were back to pre World War I levels – life was improving, albeit from a terrible starting point. However, with Lenin’s death in 1925 a power struggle interfered with governance. Trotsky, Zinoviev and Kamenev wanted to scrap NEP’s decentralization and liberalization with a totally centralized system; Bukharin dug in on the merits of the NEP. Stalin, the savviest and most ruthless of the Central Committee sided with Bukharin in order to defeat Trotsky; afterward abandoning the NEP for centralization.  Eventually through Stalin’s manipulation, Bukharin was discredited, declared disloyal and executed in March 1938 – tossed upon the scrapheap of history.

Beginning in 1928, the economy was re-nationalized. In this year, the first Five Year Plan covering 1929 – 1933 was introduced; there were a total of thirteen Five Year Plans, the last issued in 1990 for the period 1991 – 1995. Alas, the last was never implemented, the USSR was dissolved and Gorbachev resigned as its leader on December 25, 1991. It had lasted as a political entity only 69 years (actually five days short of 69).

I wonder about an alternate history. What if Stalin had been bested by Bukharin and his more right leaning Central Committee members? What if the NEP was renewed every five years and decentralization remained in place? Another query comes to mind. What if computing power was what it is now, or even that of 1980? The Soviets did understand the early power of this; they nationalized the Odhner Factory, an early manufacturer of tabulation equipment quite early on, and they were a large customer of the newly formed IBM in the 1930s.

Computation power has been expanding and its cost dropping relentlessly. MIPS/$ (“Million Instructions per Second”/US Dollar) have been increasing at annual rates from 20% to 52% since 1978. Data storage and retrieval are ubiquitous; if not at times dangerous and invasive. Bukharin couldn’t dream of this power in the planning and implementation of NEP.

This train of thought logically leads one to contemplate The Peoples Republic of China (“PRC”). PRC just might be a reincarnation of this alternate history. Mao and his Cultural Revolution kept China mired in its peasant past until his death in 1976.  Deng Xiaoping reversed course out of adversity, much like Lenin in 1922; he posited that “socialist” and “market” were not mutually exclusive – at a point where IT, computers and peripherals were exploding onto the world scene. There have been many challenges to this mixed market tack, especially after Tiananmen Square in 1989; but the “decentralists” have remained in power.

Now fast forward to Xi Jinping. The PRC was born in 1949 as Chiang Kai-Shek retreated to Taiwan. If Soviet history is to be repeated; will The Peoples Republic of China also disintegrate in 69 or 70 years – that would be around 2020? The recent wobbles with the currency devaluation and stock market free fall has dented the omnipotent image of China’s ruling elite. Xi also is a new breed; replacing the “socialist construction” with what one might call a new “Chinese nationalism,” and is consolidating presidential power at an unprecedented rate. No one still believes the GDP growth rates that are officially published; actual rates might be as low as three percent. How will the world’s second largest economy handle the transition from the factory of the world to a domestic products and services consumer?  What will follow? In the end, will a mixed market strategy and “Big Data” save the regime and let it live past the USSR’s inevitable “sell by date”?

Nils Bohr, Physics Nobel Laureate, perhaps said it best: “prediction is very difficult, especially if it's about the future.”  That said, who in 1986 would have predicted that the Soviet Union would be no longer five years hence. My sense is that China will overcome the current turbulence, in no small part because it kept away from total centralization and because of the miracle of computation power.

Still, now that I’m retired and 45 plus years from those college days, I realize I’m (and we) are not as smart and clever as I (we) thought we were. It isn’t easy to plan anything, so a national economy is a bit of a stretch. In my college years I was very much in tune with Bukharin. Today I am more free market, which is inherently more decentralized and flexible. And I’m less enamored with computational power as strictly a force for good. There are dangers lurking everywhere, but I am keeping more of a wary eye on solutions involving central planning and on big data solutions than I am on markets and individual freedom.

In spite of it all, Nikolai Bukharin remains a individual to be admired.

Am I Charlie?

The event in Paris at Charlie Hebdo was a very tragic and horrific affair. “Je suis Charlie” quickly became the meme. There was no justification for this brutality, period; full stop.  But I also think the story, its lessons and consequences, are not as simple and straightforward as the media and most politicians have presented.  

The 2.5+ million people in the streets of Paris and perhaps another 1.5+ million in other French cities were a spontaneous outpouring of solidarity. But why were these citizens on the street, did they really consider what got them out? I believe if questioned and after some reflection the majority would say they were not there mainly in support of free speech; rather they were there to decry and denounce terrorism. Terrorism’s evil cannot be debated; however, the question of free speech should be, it is more nuanced.

Free speech in most advanced societies is not without strings attached; nowhere is it permitted  to write, say, print, post or draw anything you want – it is tethered to civil or criminal regulation. Defamation, the action of damaging good reputation, has a long history of statute. The crime of “libel,” (written defamation); and “slander,” (oral defamation) are upheld in courts every day.

Blasphemy, loosely speaking, defamation of someone’s god, is more troublesome. France abolished the offence of blasphemy in 1791. But this is far from universal in the world at large. A Pew Research analysis finds that as of 2012, nearly a quarter of the world’s countries and territories (22%) had anti-blasphemy laws or policies, and one-in-ten (11%) had laws or policies penalizing apostasy. The legal punishments for such transgressions vary from fines to death. In Europe, Germany, Poland, Ireland, Italy and Greece still prohibit some forms of blasphemy and are enshrined in their laws.

Hate speech regulation further limits free speech. Laws in many countries stop child pornography and hate speech against GLBT communities. Holocaust denial and other genocide denials are considered hate speech in Germany and most other EU states.

Sorry to belabor the point, but speech is abridged in many ways; and free speech is a very fluid concept.

David Brooks, columnist for the NY Times, published a thoughtful piece on January 8 titled “I am not Charlie Hebdo” and took a bit of heat for it.
http://www.nytimes.com/2015/01/09/opinion/david-brooks-i-am-not-charlie-hebdo.html 

Still, he got to the heart of the matter. We do need to be vigilant to protect our rights to free speech from infringement by the state; but we also need to nurture societal filters for respect and understanding of others and their beliefs.

Throughout history cartoonists and satirists have exposed “emperors with no clothes” to the long term health of us all; but there have also been fowl mouthed blowhards with no respect for anyone’s feelings – journalists with not much talent, just a bad case of coprolalia.  Modern times and the atomizing of media are giving these types a megaphone that was not available to them before the Internet.

I think of a civic minded and pious Muslim; these cartoons must have been an ugly affront to him – I imagine his conflicted thoughts about the tragedy. Think of other speech disrespectful to the beliefs of other religious people – Christian, Jew, and Buddhist. I am not religious, but I’m not so prideful to think I know what really is in the great unknown.

I’m still not sure where I come down on all this.  Inayat Bunglawala former spokesman for the Muslim Council of Britain, backed its demand for a “religious-hatred” law designed to shield Muslims from offensive speech or even sharp theological debate. Now, he says, his views have changed completely: the cost of seeing and hearing things you don’t like is more than outweighed by the benefit of being able to say anything you want. For me, I’m not sure I’m ready to endorse “being able to say anything you want.” Therefore, my heart is murmuring “Je ne suis pas Charlie,” even if I’m not saying it out loud. I reject terror, but I do not embrace unbridled and unthinking free speech.

But there is hope. On our walk this morning in Hyde Park and Kensington Gardens, we bumped into the end of the “Gaza Winter Walk,” the seventh such five mile walk in support of Gaza’s children, held in London and other cities. We passed a returning family; husband, wife and a small and pretty little girl. She was holding her pale blue foam hand pointy finger (think football game souvenir) with “Allahu Akbar” printed on it. Our meeting took place right at the Peter Pan Statue, an iconic sculpture of Sir George Frampton, installed here in 1912.

Pointing her foam finger at the bronze, she sweetly said to her parents that “she liked Wendy the best.” Someday maybe all of us will see the wonder in cultures and beliefs that are not our own, with less hatred and violence the result.

Bully in Chief

In conversations lately, many friends and acquaintances have voiced “disappointment” in President Obama. Most voted for him twice, so these thoughts aren't from some Tea Party fringe. A recurring theme is that Obama doesn't exhibit enough “strong will” and “single-minded purpose.” This crops up in some discussions of domestic policy, but much more often the topic is foreign policy. My friends, and many international ones, point to “red lines” crossed and ignored, disrespect from other heads-of-state and a general dissipation of American power.

I can’t agree with most of this. America and the world should not push Obama to take “macho lessons” from Putin or Abu Bakr al-Baghdadi. For that matter, also not from McCain or other of our own government types that present things in oh so clear “black and white.”

Two points form the basis of my thoughts on this matter.

First, we shouldn't be surprised (nor should Obama) that we have bad actors and awful conflicts being inflicted on our world. In 3,400 years of documented history, most of the time humans have been at war, not peace – its how we have settled things since we started walking upright. It is hard to pin down with any accuracy, but some historians write that of those 3,400 years, perhaps 200 – 300 could be considered globally peaceful – ten percent.

Second, at present the United States military is without equal. We seem to forget that in the spring of 2003 we demonstrated this to the world. In six weeks America, with little real help, defeated the 375,000 troops of Saddam Hussein with a loss of 138 American lives. I am in no way defending this disastrous foreign policy or diminishing the sacrifices made, but merely pointing out how easily the third most highly regarded military machine at that time was crushed by ours. The United States spends over $600 billion on defense, 36% of the world’s total, and more than the next 15 top spenders combined.

I think Obama’s slow, non-confrontational and stoic approach will prove to be less dangerous, less deadly and more effective than if we had a Putin-like pugilist in the White House. The world doesn’t need a yet another trigger happy demagogic bully. But we cannot look like we have no policy or a policy of weakness. We must communicate and telegraph to the world and to the bullies what we plan to do and how we will react. This Obama has done poorly.

His communication must become simple, direct, unambiguous and totally lacking “footnotes.”

President Obama should tell America and the world:

·         Humans are a warring bunch, so we shouldn't be surprised and should prepare to have conflicts that destroy life and infrastructure. Innocent people will be hurt the world over, even in America. Saying otherwise is a cruel fiction.

·         America remains the most dominant military the world has ever experienced, stronger than any other by a large measure.

·         The pure military threat is the least of our concern. We can be late to the game, very late, and still have an assured victory if the political world stage is properly set and nations agree to the course of action.

·         America has a responsibility to the rest of the world because of our wealth and strength. This includes when we are directly threatened, but also if others are threatened. We have a big stake in not letting any part of the world sink into chaos because left unchecked it will destabilize and spread. At its heart this is a moral position that Americans can respect and the world can admire. Isolation is a naive mirage in the world we now live in.

·         America will support an economic or military response to aggression only in coordination with and the approval of the United Nations, not unilaterally. Two exceptions will apply: first, to an attack on America or Americans; second, in response to a lawful invitation from an allied country for help that is urgent to their survival.

·         America will demand little, but will be firm that our approval and participation requires directly affected nation neighbors to the conflict to have “skin in the game” in proportion to the threat against them. We will never again be seen as a solitary mercenary force fighting someone else’s battles.

·         If America responds, we will be all in. This means that our decision will not be limited, sequential, stepped or measured; we will specifically announce that our response will be what is appropriate and proportional to the size and capability of our forces, agreed among the UN nations participating. It is self defeating to limit our action to air support or other limited tactics; we must, up front, fully commit to the endeavor – or not commit at all. Mixed messages are always taken as a sign of weakness by a bully

·         America will make solving the Israeli and Palestinian crisis within three years a top priority and no longer allow either party’s brinkmanship of the process. Until this is believed by the Arab world, America realizes that our standing and influence in this region of high conflict is diminished.

Even our military says the “military” part is easy if the mission is clearly stated and the commitment is “all in.” Obama, and many presidents before him, have not taken this message fully to heart. It will take some time for the world to know that we have “put money where our mouth is.” This will be tough for awhile; America will be tested and pulled into some conflicts where a bully has over played his hand. But at some point, future bullies will understand consequences and therefore be smart enough not to overplay.

And America will wake up to a new found respect and stature in the world; and American’s will feel better about themselves, their leadership and their military.

Case in point to my argument about going slow is the current campaign in Syria and Iraq against IS. The effort underway is now supported by Jordan, Kuwait, Lebanon, Qatar, Saudi Arabia and the United Arab Emirates. This would not have been the case if we acted more unilaterally nine months ago against Assad.

We and the world do not need more bluster; we need a calm and steely strong reserve and clearly communicated, simple foreign policy principles. And if the UN and EU finally realize that they cannot just wait for America to run out of patience; then they too will perhaps face their responsibilities more forthrightly.

The military dimension is not the critical item here; it is the hearts and minds aspects of the world community. Luckily, our military might allows the international organizations to muddle along a bit as they create a consensus for appropriate action.

I like that Obama isn't a hot headed, testosterone fueled leader. We have enough of those, and our country is powerful enough not to need one.  We need more Gary Cooper, less James Cagney.

The "No-Pledge" Pledge

Some pundits are now saying that there is some hope for compromise on the budget, tax reform and reduced spending before the end of this year. The Tax Armageddon of the combined expirations of the Bush and payroll tax cuts on December 31, 2012 might prompt our government to some last minute action. This “solution” will be less than “strategic” to say the least – just crisis management like the debt ceiling debacle of last summer.

I submit that a major contributor to this chaos is the Americans for Tax Reform (“ATR”) and it’s President, Grover Norquist.   Norquist and ATR are the developers of the “No-Tax Pledge,” or in their parlance, the taxpayer protection pledge. The organization’s description starts as follows: “Americans for Tax Reform opposes all tax increases as a matter of principle.”

Of course, Norquist takes this to the absurd. To cite just two examples: ATR opposes closing any loopholes for any reason, or for even ending ineffective and market distorting Ethanol subsidies, arguing these would both be tax increases. I will not get into the flawed logic of ATR’s “starve the beast” philosophy here; however, suffice it to say that our recent history has shown that tax cuts are generally accompanied by increases in government spending, not decreases.

41 Senators, 236 House Members and 1,263 state legislators have signed the “Pledge,” scared to death of Norquist’s wrath and threats of electoral retaliation.

America needs an anti-Norquist with matching political cunning. The pledge we should ask candidates to sign is a “No Pledge” Pledge. Other than the Pledge of Allegiance, all others should be out. We need people of honor and integrity in government, individuals who we trust to have wisdom to balance principle with compromise. Many veteran legislators in Washington possess these sensibilities, but are punished for showing them by the ATR.

Norquist’s influence needs to be neutered and exposed for what it is – horribly crippling demagoguery over public policy and the implementation of true tax reform. Maybe I will be scolded by some for making analogy to the terrible images of McCarthyism; but similar fears are engendered in the hearts of politicians today. It’s time to stand up against ATR and to just say no to the “No-Tax Pledge”.

I believe money would pour into an organization supporting and backing the idea of a “NO PLEGDE” PLEDGE. I am not promulgating the idea big government or limited government, higher taxes or lower taxes; rather for supporting a democracy that actually works as intended.

To whom should we write our checks?

Refrigeration - Urban Style

This is a simple tale about a refrigerator replacement in the Big Apple.

We purchased our apartment on the Upper Eastside of Manhattan in 1998; the former owner was an interior designer and did things up in the grand style of one of the Louis’, probably the “Top Louis” to steal a line from Woody Allen. Everything was built-in to look good, but not actually function all that well. After all, this was an interior designer, not an architect or engineer.

About one year ago, our built-in refrigerator started to act up. A repairman tried to resuscitate, but alas it was not to be; it died. Thus started our quest; the dilemma was that to replace this 41” wide built-in was more than the price of an average used car sold in 2011. But to buy a more reasonably priced standalone model would require a cabinet maker to remodel the built-in, custom made cupboards. The net price of this alternative would be another used car. We decided to go with the built-in replacement, a Sub-Zero (the Bentley of cooling solutions) was the only model with the dimensions we needed.

Our apartment is on the 8^th floor of a pre-war building; moving things in and out is problematic. A gentleman from the appliance store came to do measurements. The old fridge is 84” high and couldn’t fit in the freight elevator, nor could the new one. The old would need to be disassembled to get out, the new disassembled and re-assembled to get in; of course these services are all “extra” and would extend the installation over a three day period. There was, for instance, a $200 charge for the 14 steps leading from the street to the freight elevator.

Two workers arrived to pull the old unit out and then left; he said a crew would be here to deal with the broken fridge and move in the new one. These men showed up about an hour later; no ladder and a few tools. They borrowed our ladder and proceeded to try to take the compressor/condenser off the top of the unit; many perplexed looks. After about a half hour of this, one of them punctured a Freon line, the gas escaped and refrigerant oil spewed over our floor, cabinets; literally everything was covered with a greasy slime. They started halfheartedly to wipe and smear the stuff around with paper towel (our paper towel) so we told them just to leave it. Dragging the unit out our back door, they damaged our molding and wall corner bead in several places. It squeezed into the elevator and it was gone. We quickly cleaned things up as best we could while they were gone. Not quite the BP Gulf spill, but you get the picture.

The new base of the Sub Zero appeared from out of the elevator. Surprise; it would not fit through our back door in spite of their earlier measurements, so we needed to go to plan “B.” The freight elevator opens to the 8^th floor hallway as well as our service staircase. This meant dragging the unit over our marble foyer and through the kitchen door. This door wouldn’t open wide enough; after the workers were about to give up, I removed the floor stopper which provided an extra inch and a half of clearance. The new Sub-Zero was placed in the middle of the kitchen; the crew left – no apology, no goodbye.

The following morning a certified technician from Sub-Zero arrived to sew together the two pieces; it came to life about an hour later. Of course, this worker couldn’t complete the installation; we would need to wait for the arrival of the original two workers.

An hour or two later, they showed up, hooked up the water line, removed the protective packaging; and positioned and leveled our new refrigerator. The man, Rigo, and his assistant, were at least a bit pleasant; they dragged out the cardboard and other packing materials on their way out.

The Sub-Zero looks monstrous; it’s stainless steel finish clashing with other parts of the kitchen. It looks like more renovation will follow. What’s not to love about New York?

Friendship & Surprise

Surprise and friendship are two words that do not come together that often; but they did for me earlier this month here in London. It seems appropriate to write about on this last day of 2011.

My beautiful wife Judith turned sixty-five on 26 December. In July I started to plan a surprise birthday party for her in spite of her specifically mentioning that she didn’t want one. Of course I didn’t listen. A great time was had sneaking around: arranging a date among a far flung group of friends, picking venues, planning menus and wines, party favors, developing a little slide show of Judith’s past, and lots of other small details.

Judith is a very perceptive and curious person; she notices things, so it was hard to keep this secret. A few times I was a whisker from being found out, a mouse click from being caught.

For the night of the party I had dreamed up a ruse supported by a few co-conspirators to get Judith to the party; to be held in the Mall Room at the Royal Automobile Club on Saturday, December 3.

About a week before, friend Phillip helped by inviting Judith and me to a fictitious art showing at the Club. With another friend’s support, I arranged to be called out on the day of the party to a last minute business meeting. This gave me a chance to finish setting up and to greet guests that had been instructed to arrive at six o’clock.

My wife is a fastidiously punctual person; and Philip had asked us to arrive at six thirty for the hoax art show. Carole, a longtime friend, was staying with us; we had coordinated her trip, unbeknownst to Judith, to coincide with the celebration. So as the final step, Carole was charged with the herculean task of slowing Judith down, which she did courageously and much to Judith’s mounting frustration. In spite of Carole’s valiant efforts, they still arrived to the club five minutes early; I met them at the door. After a few more vaudevillian near-encounters with a guest or two near the cloakroom; I escorted Judith and Carole upstairs to the Mall Room.  

Judith was completely taken aback upon entering the room to a thunderous yell of “SURPRISE!” She relates that time switched to slow motion, trying to figure out why Paul, from the States, was standing next to Philip; and other incongruities: Eileen was just in London, less than a month ago, what was she doing here, François and Regine should be in Mexico; Lilla, Portugal. Her right hand came up to her chest, she only could say “oh my God.”

Eventually things sunk in, and Judith was greeted by about twenty wonderful friends from around the globe. This was a priceless moment for me.

The room was conducive to conversation; friends met other of our friends for the first time; all fell into an easy exchange. Connections continued among the canapés, toasts and champagne, impromptu speeches, graceful service, nice food and good wine. Looking around it was a varied group: ages from mid-thirties to mid-seventies; different nationalities and native tongues, varied economic circumstances and political stripes. Sadly a few friends couldn’t make it because of last minute colds or other emergencies; and sadder still, our dear and departed friend Himanshu could only watch from the heavens.

Although spilled out from some cosmic puzzle box, people fit together perfectly.

The power of friendships has already been constrained in literature by too many metaphors, written by many so much more polished; I won’t try to add anything here. But I know all came together to honor Judith, and I remain awed by the richness of that blissful evening. It ranks among the top days of my life.

There was a second luncheon party the following day. It was more relaxed, conversations picked up from where they had left off the evening before. There was more champagne, wine and food (and as François jokingly pointed out, a bit too much crème brûlée).

As the year ends I have a lot to be thankful for, not least of which is friendship; and perhaps, surprise yet to come.

How Bad Is It?

How bad is it? The simple answer: "pretty bad!"

Since the early eighties and extending almost 20 years our economy and equity markets experienced a golden period; then things started to go a little sour. We had the dotcom bust in 2001 and the financial meltdown of 2008. Equity values have not really risen at all this past decade. My explanation for our current problems is that this seemingly outsized growth beginning in 1980 was a bit of a mirage; and can be pretty much explained by us citizens and our government just borrowing our way to today. Consider the following.

Our Federal Debt and the sovereign debt of other countries (think “PIGS”) has gotten the most attention, but it doesn’t illuminate the full state of affairs; it’s better to focus on all four debt components: that of governments, households, banks and corporations; in aggregate, the Total Debt.

For the longest time, America’s Total Debt was about 150% (1.5 times) the nation’s GDP. An exception was the Great Depression, when it increased to 300% (3.0 times), however this rapidly returned to normal. Around 1980 this long term trend of 150%, stable since the 1940s, began to climb. In 2011, we are now over Depression Era levels; estimates are as high as 360% (3.6 times GDP). The government, financial and non-financial companies, and households have a Total Debt of about $57 trillion (it looks worse when you actually include the zeros: $57,000,000,000,000). If we had maintained the 150% norm during this period, we would have a Total Debt of only $24 trillion. So an extra $33 trillion in consumption and investment (GDP) over the last thirty years was “put on the card” so to speak. This isn’t a trivial amount; it’s about 10% of total GDP for the period.

Some might say this is because a greater percentage of households now own their home, rather than renting. The fact is home ownership has hardly moved; in 1980 it was 65%, now it is 67%. Home equity historically had been above 50% in the United States, as of 2011 it is 38%. Housing is a big part of the problem, far from the fulfillment of the American Dream.

We most likely will not grow out of our debt problem as easily or as quickly as we did in the Thirties.

In the ten years from 1933 to 1942 our nominal GDP bounced by 187% ($56.4B to $161.9B). Unfortunately consensus estimates of our future growth are much more anemic, 2.5% annually on the high end (the economy thus taking almost 30 years to double).

Another negative staring at us is our demographics. As the Baby Boomers started reaching working age in the early Sixties there were relatively fewer children because of lower fertility and also fewer elderly as extended longevity hadn’t kicked in with full force. Academics call this phenomenon a “demographic dividend.”The number of Americans too young or old to work, compared to the number of working age adults (the “dependency ratio”) started to erode in 2010, going from 50% (5 dependents for every 10 working adults), to a forecasted 65% in 2050 (6.5 dependents for every 10 working adults). The tsunami of retiring Boomers is just beginning and it will be another unfunded and growing tug on productivity for the country.

The linked power of high economic growth and the demographic dividend are not present for us in this latest crisis. We are going to have to pay down a big chunk of this debt along with greater interest payments, analysts antiseptically call this an extended period of “deleveraging.”

And this rather gloomy scenario assumes we start accepting the truth about our current situation and get public policy and individual responsibility mostly right; which at this moment seems a bit farfetched. American politicians are bickering with themselves to distraction; the Euro Zone is balancing on the brink of collapse. China faces wrenching shifts away from its very successful export led growth and is also burdened with the worst dependency ratio trend in the world (rising from 38% today to 64% by 2050). It’s hard to see much to smile about. 

Michael Lewis’ new book, “Boomerang: The Meltdown Tour” has a wonderful quote that captures the moment: “leverage buys you a glimpse of prosperity you haven’t really earned.” We are in some big trouble. Interest payments and debt reduction will be a real and yet necessary drag on all our lives for perhaps decades. I think it would be foolish to plan for something else; better to dampen expectations and modify behavior now, perhaps to be pleasantly surprised later.

After all, there’s always an “upside case” that might be realized.

Weapons of Mass Distribution

We arrived in Budapest yesterday for a ten day stay.

We were having a late afternoon drink in the lobby of our hotel, the Four Seasons Gresham Palace when a group of motorcyclists arrived to check in. The group later met in the lobby bar, about a dozen. Overhearing language and accent, they were from the Middle East.

All were decked out “head to toe” in the latest Harley Davidson gear; leathers, tee shirts, headbands, knapsacks, boots and hats; in fact any bit of clothing a logo could be plastered upon. I imagine tens of thousands of dollars worth. Their “biker girls” were donning their hijabs, these without logo, but clearly Hermes. All were drinking Coke Light with lemon and discussing the ride. These were wealthy folk; I overheard one man on his mobile ordering up the washing of the hogs (actually, maybe not this exact term). Later in the evening we saw them loading onto a small luxury coach, off to dinner somewhere.

Our concierge friend told us they were in fact wealthy Saudis, completing a European road trip – they had arrived from Vienna; Budapest was their last stop. They were returning to Jeddah in the morning by private jet; bikes and gear by cargo plane.

Why I write and what struck me was the universality of some American brands like Harley Davidson and Coke; and France’s Hermes. Seemingly out of context, but not. In spite any hatred brewing in the Near East about the West; the world still aspires to the attributes these Western products exude: freedom, refreshment, luxury, possibilities. We may not live up to this in our foreign policies; the products do. They are more potent than our military will ever be in reshaping the world; truly weapons of mass distribution.

The Ebb and Flow of Tolerance

Our recent trip to Spain’s Andalucía region, with its rich history, prompted thoughts on the ebb and flow of tolerance, and its fleeting presence.

My first insight is that “tolerance” is a much used word; therefore, some of its meaning has blurred over time. For instance, most of us do not understand that you cannot exhibit tolerance without having power over those to whom you extend it. Tolerance is voluntary action by someone who could control things otherwise. By way of example, if the table next to me in a restaurant where I’m not known nor have any influence is loud and annoying, I put up with it; I don’t tolerate it. On the other hand, if it were my restaurant and I had plenty of customers, yet I allowed it to continue, I would be tolerant of the behavior. Tolerance has a conscious forbearance of behavior (read custom or belief) even though one looks upon it with disapproval; and might see it as inferior, harmful or distasteful. You endure it even though you have the power to disallow it.

My second insight is that this virtue is not innate to a culture. For almost 800 years, Islamist Moors controlled most of Spain, from 711 to 1492 and the fall of Granada. This was a period of tolerance; Jews and Christians were allowed to practice their faiths without being tortured or expelled. I’m not trying to make this an idyllic setting, there was ingrained prejudice, and ghettos were numerous. Society wasn’t a serene meritocracy; but those in power had forbearance to those without. And this society flourished intellectually and commercially.

When the Catholic monarchs finally defeated the Moors, the Spanish Inquisition happily started. Moslems and Jews were forced to convert; or be killed or expelled. Even among those that converted, many were tried as heretics. Recent texts downplay the number of sinners burnt at the stake, and the brutal torture techniques; still large populations of non-Catholics fled the area: Jews, Muslims and Protestants alike. This intolerance wasn’t a short term event; it wasn’t officially abolished until 1834 under Isabella II. The region suffered; the Enlightenment was slow to take hold here.

Today we constantly see the West lecturing the Moslem world to become more secular and tolerant. What a difference 500 or so years make. When the magnificent mosque in Córdoba was being constructed, most people in Western Europe were huddled in caves; enough time turns everything on its head.

Absolute values are easy to explain and indoctrinate; just black and white to defend – simple belief. Relative values have a much tougher road; all that gray tone – lacking the fire and brimstone. America has lots of power in the world, so we must have forbearance; tolerance. I fear we are losing some of this. Others without power just have to “put up with it;” but not happily and not without a growing bitterness.

We need to pay more attention to history.