Thursday, February 25, 2010

Feeding the Beast--Our Addiction to Anger and Fear

If you ask most people what they want the most for themselves--and certainly for their children--the vast majority would say "happiness."  We want to be happy and we want our friends and family to go through life with every reason to wear a big smile.  If you Google "how to be happy" you will find 165 million distinctive links.

So why do so many people spend every waking moment watching, listening to, and reading things that tell us up front are specifically designed to make us angry or afraid?  This isn't the unpredictable bad stuff that just happens as part of the ups and downs of life.  This is going out of our way to to listen to people and read things that advertise their goal is to make us angry and miserable.

During a single 12-hour period last week, I received emails headlined "Do you want to get really mad?"--obviously a rhetorical question since the presumed answer was "of course I do"--another saying "We should all be afraid," and a third that was simply called "OUTRAGE."

Each email was sent by a seemingly normal, well-balanced friend who had included me on a list of 12 or more other recipients.  Two of the emails showed a long history of others who had received and forwarded them--more than 100 people in a matter of a few hours for each.  Instead of deleting these messages that promised to deliver misery and despair, my friends apparently couldn't wait to open them and send them on as quickly as possible to friends and family members who they presumed also wanted to get more angry and afraid.

If most people say their goal in life is to be happy, then why do they spend so much time and money convincing themselves and others how furious and fearful they should be?  Why do millions of us spend much of the day listening to ranting, raving, outraged people on the radio, come home and watch the angry Right wingers on Fox or the angry Left wingers on MSNBC and then read the steady stream of emails telling us how mad and scared to death we should be of our own government, Muslims, Arabs, Obama, Liberals, Congress, the media and everyone else in the world?

It gets even more bizarre. Our addiction to anger and fear has become so insatiable that there doesn't seem to be enough terrible and/or scary real news out there to meet our ever-growing need for outrage.  The truth has become irrelevant as we stretch to feed our addiction to the beast of anger, blame, and fear.

The vast majority of emails, blogs, and other angry stuff are full of lies and distortions. The business of providing raw material to the misery pushers has become so large and successful that a number of websites thrive doing nothing other than check the veracity of stories that are flying around the internet. Snopes.com, factcheck.org, and others get millions of hits from people who are suspicious about the truthfulness of the hateful emails they get.

But it gets even more bizarre.  When I fact check the angry lies and find out that President Obama did NOT really attend Occidental College under his real Kenyan name or that Michelle Obama did NOT run up a $450 room service bill for a snack at the Waldorf Astoria or that or that the calls for a 28th Amendment to the Constitution reigning in Congress are based on phony assertions, I assume that the friends who sent me and others the lie in the first place would appreciate knowing that they were spreading falsehoods. 

Guess what?  Every time I have informed them of the fact, they get angry at ME, accuse me of being a liberal, and never go back to their sources or the people they have misinformed to correct the mistake or apologize for spreading lies in the first place.  One friend said he always fact checks emails before he forwards them but the one full of lies that he sent me was "too good to check out."

Just to be clear, these emails and media reports are not honest mistakes or matters of opinion.  They are lies that were created (often with time-consuming care, elaborate layouts, and artwork) and disseminated by people who knew they were lies from the outset.  They were never designed to inform or enlighten.  On the contrary they were created for the specific purpose of creating anger and demonizing their targets.

New York Times columnist Thomas Friedman once said that "addicts never tell the truth to their pushers."  He was referring to the unwillingness or inability of the U.S. government to call the Saudis to task for their role in financing and promoting terrorism around the world.  Friedman explained that since we are addicted to Saudi oil, we can't or won't ever be truly honest with them for fear they might cut us off.

It would appear that millions of American have become truly addicted to anger and outrage.  Fox News and  talk radio figured it out first and years ago became the crack pipe of the angry Right.  They realized early on that there's no money in real journalism any more but they could get rich feeding our insatiable need for heroes and villains.  

The other cable channels were slower to catch on, but now MSNBC, CNN, CNBC and the rest all want to make Fox-sized money ($700 million in profits last year with $23 million going to Roger Ailes, the CEO) so they have abandoned journalistic standards as well.  Their idea of "balanced coverage" is getting the most extreme advocates of competing positions, putting them on stage together, and encouraging a food fight. 

When was the last time you saw a guest on a cable station advocate a nuanced, pluralistic position and acknowledge the partial truth of opinions of the other side?  My friends who used to appear frequently on these programs now say they can't get on the air unless they promise to be rabidly partisan.

So, to paraphrase Stan Laurel, "this is a fine mess you've gotten us into, Rush."  We all want happiness more than anything else and yet we have become hopelessly addicted to media and emails that promise to make us UN-happy.  How do we shed our demons and get back on track?

Here's a thought.  First, stop watching cable news and listening to talk radio.  I did that six months ago and haven't missed a thing.  I have not missed the people I used to disagree with all the time (not surprising) but I also haven't missed the people I used to agree with that are trying to make other people angry.  I have seen 132 episodes of NCIS, Law and Order, and CSI and know a lot more about sports and the weather than I used to.  I even read a book.

When you get emails that promise to make you angry or unhappy, either delete them or if you have to read them, fact check them and let the sender and other recipients know if they are based on lies.  If they are written anonymously, contain provocative pictures and inflammatory phrases, provide no contact information for the original author, and encourage you to forward it to the whole world if you agree but instruct you to delete it if you don't, it is almost guaranteed to be full of lies and distortions.  Dozens of examples are available upon request.

Finally, we need to stop looking for villains and start looking in the mirror.  What ever happened to the notion of shared sacrifice and shared responsibility?  What ever happened to John Kennedy's exhortation to ask what you can do for your country?  These are very hard and challenging times for most Americans.  The solutions do not lie in anger and demonizing the other.  They lie in our own hope, perspective, ingenuity, and ability to be part of the solution.

We may not come up with a lot of good answers right away.  But if we can stop feeding the beast and start to break our addiction to anger and fear and villains and hatespeech it would be a good start.

Monday, January 25, 2010

A Very Bad Week for America

America and democracy just had a very bad week.

The biggest headlines were garnered by the truly shocking victory of Republican Scott Brown in Massachusetts.  Brown won the Senate seat that had been held for decades by Teddy Kennedy and will represent the only state to vote for George McGovern.

That surprise was the result of democracy in action.  The people of Massachusetts have spoken and it is what it is.  The bad part is that somehow the will of the people doesn't matter any more in the Senate.  For the first time in my lifetime, it now takes 60 votes to pass anything.  Now that Brown has joined the 40 other GOP Senators from the Confederacy and the Wilderness states, they can essentially make sure that nothing happens in Congress this year even though they represent states that have just 20 percent of the population.

In short, the will of 80 percent of Americans can be thwarted by representatives of 20 percent due to a quirk in Senate rules.  I'm pretty sure that's not what the Founding Fathers--or anyone else--had in mind.  Not good for America.

Then the Bush-stacked Supreme Court checked in with a 5-4 ruling that gives corporations the right to spend an unlimited amount of money on political advertising.  During the health care reform debate we have already seen how little corporations care about the welfare of the people and how much they care about promoting their own profits.

More than $500 million has been spent on Congressional health care lobbying by the drug and health care companies.  That's about $1 million per member of Congress.  That's over and above the millions that the drug and health care companies recently contributed to the campaigns of Max Baucus and Charles Grassley, the ranking members of the Senate committee that gutted the final bill.

As a result, we will end up with either no health care reform at all or some watered-down version that will accomplish little.  This is occurring at a time when 50 million Americans are uninsured and more than half of all personal bankruptcies are due to a catastrophic illness.  No one who is not on Medicare is happy with their health care insurance which costs more and more each year and covers less and less.

The Constitution begins with the words "We the People"--not We the Corporations. It seems like a strained interpretation at best to grant profit-making companies unlimited access to mind-bending advertising in the name of free speech. At the end of the day, we will certainly end up with more lies, distortions, and half-truths designed to get Americans whipped up and angry over provisions that are probably in their best interest but which might cost companies profits. Not good for America.


Finally, it seems that pundits on both sides of the aisle have deemed Obama's presidency an abject failure and are counting the minutes for just three more short years before we can replace the bum.

I find all this fascinating and yet another step forward in the lies and distortions become fact mode of our media and the perpetually angry people who are...well, perpetually angry.

I mean we do have a president who has put in place economic policies that caused the stock market to rise more than 60 percent creating more than $5 trillion in net worth for average Americans. That 10 month rally began at a time when most experts were advising investors to put their money in safe t-bills at zero percent after their portfolios had already been destroyed.

He is also a president who has made it very hard for the terrorists around the world to raise money or recruit new suicide bombers since he has reached out to dialogue with our international friends and enemies instead of lecturing and threatening them. His earning the Nobel Peace prize was not all that popular on Fox News but it was a good sign that the rest of the world appreciates what he has been doing.

But the election in Massachusetts and the reaction of the media and markets is sending a message to our friends and enemies that the American people may not be firmly behind our president anymore. As a result, our creditors (the same friends and enemies around the world) have pulled back from our markets causing the biggest one week decline of the year in stock prices. Not good for America.

So we've had a rough week. That much I know for sure. As far as the deeper meaning of all these developments is concerned I don't really have a clue. As always, I'm pretty sure that most of the pundits have it wrong. I'm also completely certain that the anger that I see in emails, blogs, and the broadcast media will only rise since there seems to be so much money to be made from that approach.

As far as the long term impact is concerned, we'll all just have to stay tuned. But there IS one thing I know for sure.

None of it is good for America.

Wednesday, January 20, 2010

Windows and Mirrors

Any house that we would want to inhabit should have a good number of both windows and mirrors. The windows are needed so we can look through them and see what is going on outside the house.  The mirrors are needed inside so we can look back at ourselves critically with an eye toward self-improvement. 

The balance is important.  In a house with only mirrors and no windows, we might conclude that we are perfect just the way we are since we would have no external standards or basis for comparison.

I started thinking about this after having lunch with a friend of mine who is truly an expert on the situation in the Middle East. He works as a consultant to armies and governments here and around the world advising them on a broad range of strategic and security issues. When I'm with him I sometimes don't know if I should feel super safe or scared to death.

He was talking about Al Jazeera, the Arab owned and operated TV news station that is carried around the world but is the only news option in many Middle Eastern countries.   "Television news is supposed to be a window to the world," he said. "It is supposed to broaden your horizons. But the way Al Jazeera operates, it is really a mirror--not a window. Their viewers don't get to see what's outside. All they get is what's going on inside flashed right back at them and the call it news."

In many Arab countries, Al Jazeera is the only news source available. Most citizens there don't have the choices that we have in the Western World.

But despite our limitless choices, we live in a society where millions of us have voluntarilty wrapped ourselves in a windowless news and information cocoon where the only thoughts, information, and opinions we choose to hear are those that confirm the beliefs we already had to begin with.

There is actually a name for this phenomenon--or pathology. It is called Confirmation Bias. It is defined by multiple sources as "a tendancy of people to prefer information that confirms their prevailing beliefs or hypotheses regardless of whether or not it is true. It can lead to disastrous consequences--particularly in military or political situations."

When I was a television news reporter a few decades ago, it was harder to avoid the windows and surround yourself with mirrors. There were 3 national television networks and they all broadcast the news in a pretty straight-forward manner. I can remember being told that a really good reporter or journalist was one whose personal beliefs on a issue were impossible to determine.

I watched Cronkite, Huntley, and Brinkley for many years and they became my role models  To this day I have no idea what their personal politics were or how they voted. And I really didn't care. I was using them as a window--to inform me what was going on in the vast world outside. That was their job--not to tell me how I should feel or which candidate to support.

During my 10 years as a reporter, my editors repeatedly hammered home the need to be fair and objective and not let any personal feelings I might have get in the way of my reporting.  They were also obsessed with fact-checking and accuracy.  I never had to run a retraction because I never reported anything as fact that wasn't true.  If we couldn't prove it, we didn't report it. 

But times have changed and the architecture of our media houses has changed as well.  We now have a proliferation of 24-7 news, opinion, and reality shows (often undifferentiated) coming from dozens of television networks.  Most of the time there is just not that much compelling news going on, so virtually all television, radio, and internet news programming is geared to provide us with flash, controversy, and titilation. 

For decades we have been able to listen to sporting events broadcast by the home town announcers who want our team to win every bit as much as we do.  Our Confirmation Bias causes most of us to prefer listening to our sporting events that way.  But now we can get our news the same way--delivered by celebrities who are more concerned about being the first with exclusive details on the Balloon Boy than they are about determining if they are promoting a hoax.  They are pushers of of biased presentations designed not to inform us but to feed our addiction and make us feel smart about the beliefs we already have.
A person on the political Right can get all his television news from Fox and when he is in his car he can choose from literally dozens of perpetually angry people who creatively and loudly blame Liberals and Democrats for all of the real and imagined horrible crimes and disasters that afflict us daily. If this person is ever away from radio and television, he can go on line to hundreds of websites devoted to the same agenda while sorting through the dozens of forwarded emails he receives daily from his friends hammering home the same message.

It is possible, although slightly more difficult, for a person on the political Left to do the same. They can get all their news from MSNBC and listen to National Public Radio and Democracy Now in their cars but the choices are far more limited and lack the volume and their inability to match the visceral anger of the Right  Liberals also tend to forward fewer emails. 

But let's be honest.  Fox made $700 million last year--more than all the other cable channels combined.  Its CEO Roger Ailes made $23 million.  There are dozens of angry Right wing radio hosts for every angry Leftie and Rush and friends are making millions while their Liberal counterparts are on NPR and living on food stamps.   Fox is in a class by itself since it creates the news and promotes phenomena like the Tea Parties, sends its "reporters" to appear in them--often for a big fee, then reports on the very news they have helped create, and they make a fortune every step of the way.  There are living in the mirrored penthouse cocoon while the Left wing wannabes like MSNBC are in the mirrored housing projects. 

It's partly because they're better at it but mainly because their customer base is so much larger.  My friends on the Left who live in an information cocoon know they are doing so and they're comfortable with it because they believe they are smart and Right wingers are stupid.  My friends on the Right actually believe they are getting Fair and Balanced news and that Beck, Hannity, and Limbaugh are giving them a broad view of the world.

But the net effect is the same. Millions of people now go through life feeling well informed and very much on top of the major events in the world even though they spend all their time looking in the Confirmation Bias mirrors and they have no enthusiasm for windows at all.

Four years ago, the Vice-President Dick Cheney came here to Tucson to make a fund-raising speech. The local newspaper did a story on the accommodation requirements of the V.P. I was quite taken by the fact that Cheney's advance team told the hotel that only two things were absolutely required. The first was that there be decaf coffee, 4 cans of regular Sprite and a tub of ice in the room. The second was that all the TVs in the room be tuned to Fox News before Cheney arrived.

The Vice-President of the United States was so determined to be only exposed to the Fox version of events that he didn't want to run the risk of having the TV stop on CNN or MSNBC even for a second as he was searching for his TV mirror. So it had to be set up in advance.

I read that article shortly after President Bush stated in a interview--without embarrassment--that he never read the newspapers or watched or listened to radio or TV news. He said that his staff filled him in on all the news he needed to know. I was later able to better understand how Bush spent four days riding his bike and clearing brush in Crawford, Texas after Katrina--apparently oblivious to the tragedy that the rest of us were watching unfold on TV. Bush wasn't watching TV, and none of his staff had the guts to break the news to him.

Many of my liberal friends are different--but no better. They tend to be more aware of a broader range of opinions and points of view that are floating around. But they just assume that the positiions they agree with are so logical and superior that everyone will gravitate in that direction. They are dissmissive of views to the Right of them in a very condescending and annoying way.

At the end of the day, my Right wing friends would rather die than read the New York Times, watch MSNBC, or log on to the Huffington Post. My Left wing friends would never watch Fox News, read the editorial page of the Fox-owned Wall Street Journal, or boot up the Drudge Report. Not only would they never look out the window to see what's going on in those other places--they would look at me as though I was crazy for even suggesting it.

Two years ago, I wrote an article about the importance of pluralism--the ability to find the partial truth in the opinions of those with whom we disagree. Or at least to try. That was the reason that this committed Jew leapt at the chance to study Buddhism for several days with the Dalai Lama and his teachers. It was an amazing experience during which I looked through a window and learned from Buddhist wisdom in a way that I hope has made me a better Jew and human being. 

But unless we as a people start replacing some of the mirrors in our houses with windows, we are going to end up like the millions of people under repressive regimes who watch Confirmation Bias disguised as news all the time. The sad difference is that those people have no choice.  We do.

We chose to leave a house that had both windows and mirrors.  We chose to abandon a history of national dialogue and a level of civility based on windows and mirrors that served our democracy well for centuries.  Instead we have allowed modern technology and the profit-hungry media to brick over all the windows and have chosen to surround ourselves with mirrors.

And all we have to show for it is more and more anger, hatred, lies, and distortions. Instead of getting all our information and feedback from those mirrors, maybe we should spend more time looking long and hard into them and taking a good look of what living in our new house has done to us as a people.

Both the blessing and the curse of democracy is that we own the results of the choices we make.  We will get the kind of government and the level of civil discourse the we demand and deserve.  But we won't find it by only looking in the mirror.  We need to look out the window and find a higher standard for our national dialogue and our own behavior.

Friday, December 4, 2009

Lying is Fun-Payback is a Bitch

My Inbox is still empty as many of my angry friends try to figure out how to cope with the shocking and disturbing news of the day.

Friday morning the government announced that roughly as many jobs were created last month as were lost. That was a far better result than was anticipated. In addition the unemployment rate dropped instead of going up again as expected.

Many of these friends--who are united in their hatred of the President of the United States--are already reeling from the fact that the stock market has gone up for nine months in a row producing the sharpest rally in our lifetimes.  And now this!

Throughout it all, angry and ominous emails have been arriving almost daily warning that President Obama is ruining the economy and the country with his horrible Obamanomics and terrible policies. These screeds of course have ignored the fact that when Obama took office the economy had already been ruined by his predecessor's policies and that the world was already facing the very real threat of a complete meltdown of the financial system.

They also have repeatedly bemoaned the fact that under Obama our national deficit would grow to more than a trillion dollars a year and our biggest and most irresponsible banks and financial institutions would be bailed out to the tune of trillions more. These expressions of outrage--which continue unabated to this day--also ignore the fact that all of that had already happened during the Bush years as well.

They are like a person who's dying of cancer going to see an oncologist to seek treatment and then blaming the doctor for giving him the disease in the first place. It seems ridiculous but, as we have all learned too well, if you tell a lie often enough, it becomes the truth. Lenin said it first, Karl Rove refined it and took it to a new level, and bloggers, emails, and hate-radio and cable jocks have made it their mantra.

Despite this adoption of virtual reality as truth by so many friends, I have continued to cling to the old-fashioned notion that no matter how many people believe a verbal rant or a forwarded email full of falsehoods and distortions, a lie is still a lie. 

Like Bernie Madoff, Tiger Woods, and others, my friends are now finding that when you  build your life on a foundation of falsehoods, you need to tell more and bigger lies just to keep from having to admit you were wrong in the first place.  Eventually the liar has no choice but to admit that everything has been a fraud from the beginning. It can be dangerous. You can end up in jail for the rest of your life or lying in your driveway with a 3-iron lodged in your head.

This harsh reality is now confronting former CNN entertainer Lou Dobbs.  Dobbs decided a couple of years ago that he could develop a huge devoted following among American racists by spending all his time attacking illegal immigrants and essentially blaming all of our nation's real and perceived problems on them.

When that act got a little tired, Dobbs expanded his racist product line and became the poster boy for the Birther movement--those who didn't want to just come out and say that it drove them crazy that Americans wanted a black man as president so they continued to claim that Obama was really born in Kenya and wasn't an American at all.

Now Dobbs has been fired by CNN and wants to seek public office. Not surprisingly, he received moral and financial support from Americans for Legal Immigration (ALIPAC)--arguably our nation's most racist anti-immigrant group. But now, in his effort to become palatable to people outside America's most virulent hateful and lunatic fringe, Dobbs, who is now running for a Senate seat in New Jersey, says he might support just a smidgen of amnesty for some illegals.

Like all liars and those who count on the worst of us for their support, Dobbs has found that if you sleep with enough dogs, eventually you will come away with fleas. His most ardent racist supporters have now called Lou a traitor to the cause and have thrown him under the bus as well. So now Dobbs still has no support from the vast majority of Americans who stopped watching his racist rants years ago and got him fired from CNN and he also has lost his friends on the racist Right. What's a liar to do?

Most of us also get regular emails demonizing Nancy Pelosi from the same Obama haters.  We are repeatedly told that the Speaker is almost as evil as the president himself. They say she wants to tax us all into oblivion and take away our rights.


Of course these tomes ignore the fact that no one's taxes have been raised this year, no one's rights have been taken away, and now Pelosi is opposing the proposal of fellow Democrats who want a temporary War Tax be instituted so we can start paying for the wars we have been fighting in Iraq and Afghanistan for the last eight years.

I'm still waiting for the emails praising Ms. Pelosi for working to keep our taxes down but my Inbox remains sadly empty.

By the way, the Speaker's decision not to make Americans pay for our wars is wrong and immoral.  As a fiscal conservative, I am a strong believer that we should pay our bills and that we shouldn't make our children and creditors pick up the tab for money that is being spent on our behalf today.  It is also clear that our economy and job picture are still dismal and in the very early stages of recovery.  Huge problems and challenges remain.

But this piece is not about political ideology. It is about the dangers of making a strong case for a position based on lies and distortions. It is sad that so many Americans have resorted to this and it is more outrageous that the news media have been so complicit.  As a result of their lax and often non-existent Balloon Boy style fact-checking, they routinely give a platform to liars in the name of balanced reporting.

If you live long enough, your choices can come back to haunt you. I feel concern for my troubled friends and wonder how they're going to cope. Their choices are limited.  They can kick the can further down the road with more lies and distortions or they can man-up, admit they were wrong all along, and change their ways.  Keep checking your Inbox and your favorite cable channel.  Their answers will show up soon enough.

Life is tough enough for those us who try to tell the truth. I can only imagine how much harder it is for those who don't. I'm trying to feel sorry for them. It's not working yet but I'll keep you posted.

Monday, November 23, 2009

Feeding the Beast--Our Insatiable Need For Villains

The truth?  Jack Nicholson was right.  We can't handle the truth.  Either that or we just prefer not to hear it..

The truth is that America is still suffering from what is likely to be a very long hangover after a decade of binge spending.  Led by George W. "Keep Shopping" Bush and his friends in Congress, we spent most of the last decade digging ourselves into a deep and wide economic hole.

No one behaved like a grown up.  We elected and supported representatives who ran our government into debt while we ran ourselves into debt with the help of our financial institutions who loaned too much money to people who couldn't pay it back.  When all the bills came due at once, no one had any money to pay them.  So the government is printing money and the ultimate bills will be paid by our creditors, our kids, and people who own dollars that will buy less and less over time.

If this wers a movie, we would come away from this humbling experience chastened, embarrassed, wiser and determined to get it right the next time.

But in real life it's apparently much easier to just get angry at everyone except ourselves and look for villains to blame.  We are told that we didn't do anything wrong.  We're the victims here of the bad guys who brought us down and continue to screw us at every turn.  Nothing is our fault--it's all about those horrible folks who did us in. 

At first the villain was simply called Wall Street Greed but that was too general to be truly satisfying.  During the last few months that problem was solved by simply blaming everything on Goldman Sachs and the people who run the company.  The depth of our addiction to bad guys became clear when even the New York Times piled on last week with an editorial saying that Goldman--only Goldman--should be ashamed of itself.

The international crisis was created by Merrill, Lehman, Bear Stearns, AIG, Fannie Mae, Freddie Mac and the other Goldman competitors who leveraged up themselves and the system to levels that caused a true meltdown when their bets went wrong.

To blame Goldman--which was not the major player when it came to creating the toxic assets and which did not leverage itself up on one bet like the others did--would be like blaming a manufacturer of automatic weapons for what happened at Fort Hood.

The system didn't get brought down by bad mortgages.  It was brought down by major investment firms (not Goldman) who decided to leverage up 30 and 40 to 1 in a single asset class. As result, instead of just taking a hit on a bad bet--which happens all the time--they were wiped out and the international financial system was put at serious risk.

The government (not the taxpayers because we haven't paid a dime yet) bailed out AIG to the tune of $170 billion and counting. Goldman received $12 billion or almost exactly 7 percent of that money. And yet, they are the only name ever singled out as the bad guys who ought to be ashamed of themselves for having the nerve to benefit so dramatically from the recovery in the markets because they're better than everyone else.

What about the companies and people that got the other 93 percent? Do you ever hear any of them singled out for special demonization the way that Goldman has been?  Is there any indication that anyone at Goldman committed a crime or did anything illegal? Has anyone been charged?

Goldman did what investment firms are supposed to do.  They invested legally and wisely in a way designed to make themselves and their shareholders wealthy at the expense of others who were less insightful.  Until a year ago, that's what American success was all about.  A "good" accountant is one who figures out a way to help his clients pay as little tax as is legally possible.  A "good" lawyer is one who can get you off no matter how guilty you might be.  A successful person or company is one that makes an enormous amount of money.  Someone must have changed the rules without telling the rest of us.

For many angry Americans, the Big Three--Obama, Pelosi, and Reid--have been the ultimate villains since their first day in office.  It's ironic that there are two major seemingly contradictory complaints about Obama.  One is that he is doing too much and he's ruining the country.  The other is that he hasn't done anything at all and he's ruining the country.  But when you're dealing with demonization, facts become an irrelevant nuisance. The important thing is to get really angry and encourage others to do the same.

So at the very time when we face serious problems and desperately  need intelligent and nuanced discussion of complex issues, we are getting the exact opposite.  At the time when we most need to become reacquainted with true patriotism involving shared sacrifice, we are being told that we are not the cause of any of our problems so there is no need for us to be part of the solution. 

Instead we are told to get really angry and focus on the villains who got us into this mess with their greed, avarice, and evil motives.  It certainly won't help solve any of our problems but it is not nearly as painful as looking the real nature of our challenges and the key to surmounting them squarely in the eyes.

For most of us, those eyes stare right back at us when we look into the mirror.

Monday, November 16, 2009

The Outsourcing of Patriotism

Each of us interfaces with major news events in our own way. We take reported facts and run them through the personal opinions and filters that we use to shape our view of the world.

So when Major Nidal Malik Hasan opened fire and gunned down dozens of his fellow servicemen at Fort Hood, it was predictable that some would conclude that you just can't trust Muslims while others saw it as yet another sign of the ancillary tragedies of war. Some came away concerned that there would be an outsized backlash against Arab and Islamic Americans while others called for just that. Was Hasan a lone wolf acting on his own or part of an international terrorist plot?  Inquiring minds want to know.

Not really.

We claim to demand answers to these questions but, in truth, we don't care so much.  The questions are rhetorical. Politicians and ideologues take snippets of information and use them to support conclusions and positions reached long before anyone heard of Major Hasan.

That's because at no time in U.S. history have so few of us had any personal or finacial skin in the game of defending our country.  Most of the victims at Fort Hood, like most casualties of our current disastrous wars, were from small rural towns that most of us don't even know exist. Only 2 of the 13 who were killed hailed from metropolitan areas.

The rest were from West Jordan UT, Bolinbrook IL, Mountain City TN, Havre de Grace, MD, Kiel WI, Woodbridge VA, Willistron ND, Plymouth IN, Racine WI, Tillman OK, and Cameron TX.

The vast majority of Americans live in cities with populations of more than 100,000 but 85 percent of those killed at Fort Hood and most American victims of the war did not.  I've been checking the hometowns of our war victims for years and they are always disproportionately rural.  Try it yourself.  You'll be shocked.

The sad truth is that we have outsourced virtually every aspect of our military effort to paid government contractors and young rural men and women who are attracted to the economic package of six-figure enlistment bonuses, death benefits, and educational opportunities available in the military.  Adding to the irony is that Major Hasan himself apparently enlisted for financial reasons--not because he longed to serve America.  He just wanted a free trip to medical school and was willing to do his time in the service to pay for it--until he wasn't.

Being patriotic used to involve actions and not just words. Patriots were those who enlisted in the military--not those who bought an "I Support the Troops" decal at a gas station. Patriots were those who gladly paid higher taxes to support the war effort--not those who demanded tax cuts and held tea parties to complain that they had to pay any taxes at all.

The sadder truth is that most of us have substituted words, blast emails, blogs, and rants we hear and see in the media for truth and actions. The politicians and angry screamers on cable TV and the radio argue incessantly about what we should do in Afghanistan and Iraq but the fact is that most of us really don't care. Very few people could find Afghanistan or Iraq on a map or know a single soldier who has ever served there.

Each TV and radio station has dozens of hosts and guests who argue constantly over what military course President Obama should take but most of those same stations have no reporters on the ground actually gathering facts and covering the wars in which our country is engaged.

Most of us don't complain about the lack of coverage because we just don't care. Most of us lose more sleep over the ups and downs of our favorite football team than we do worrying about the fate of Americans (no one we know) serving in the Middle East.

Shortly after 9/11 most Americans wanted to know what we could personally do to help fight the new terrorist threat.  President George W. Bush told real patriots to "keep shopping" and pay less in taxes--not more--even as the U.S. was about to embark upon a dangerous ordeal that would cost tens of thousand Americans their lives and health and would run up a tab of more than a trillion dollars.

That became the model for the new patriotism. Don't enlist, don't encourage your children and grandchildren to serve their country, and don't even think about making financial sacrifices to help pay the bills. Just keep shopping, vote Republican, and question the courage and patriotism of those who raise questions.

Don't worry about sending your kids to fight. We'll just keep raising the bribes we pay to poor rural kids who want and need the money enough to risk their lives and then once we get them in we'll send them back for four and five tours. Those soldiers who survive may be physically or mentally crippled for life but your kids and finances will be fine.

Since Obama was elected, it is no longer required to even pretend to care. The "I Support the Troops" decals are hard to find now. We have become sadly complacent and comfortable in our new role as armchair patriots.  We're too busy getting angry, demanding new entitlements, and feeling screwed by our government as we pay the lowest tax rates in our lifetime.

Now, just a couple of weeks after the horrific murders at Fort Hood, not even the news media pretends to care so much.  After an initial flurry of reports and commentary, there are hardly any news stories about the massacre. Much more airtime is being given to Sarah Palin's book tour than to the wars, Major Hasan, or his victims.  The compelling and important story of the Ballon Boy got at least double the coverage.

That's the real story from Fort Hood. It's not just about a Muslim officer who maimed and murdered dozens of his fellow American soldiers. It's about the consequences of the outsourcing of patriotism in our country and the sad fact that most of us don't even care enough to be ashamed.

Tuesday, November 10, 2009

The Market's Not That Complicated

The markets continue to frustrate most investors as trends that have been in place for much of the year remain operative long after most of the experts believed they had already gone way too far.

Most pundits have been advising caution for months as world stock markets continue to march higher. They have been declaring buy-and-hold strategies to be long dead in this new age of high-speed trading strategies and risk management.

The new way of thinking is perhaps best showcased on CNBC’s Fast Money—a daily one-hour program where the underlying assumption is that intelligent trading and investment strategies change every minute and the only way to make money in this complex world is to shorten one’s time horizon accordingly.

I couldn’t disagree more.

There are new developments on a daily basis that do affect the prospects for specific industries and companies and one does need to pay attention to the news. But the trends that have been driving the markets this year are macro and secular and should be with us for a long time to come.

Here are the four themes that have driven and continue to frame my investment approach:

1. The U.S. and other countries that were devastated by the financial meltdown last year have responded by printing mountains of paper money that is backed by no tax revenues or assets in an effort to stimulate their economies and avoid what would have been a systemic collapse.

As a result, it is taking more and more of those pieces of paper to buy real stuff—hard assets like gold, copper, energy, and other basic materials. The pundits keep talking about the falling value of the dollar but it goes beyond that. We are in the early stages of a period where the currencies of many countries should be viewed with suspicion as the weak economy and low tax rates continue to reduce tax revenues as the printing presses around the world continue to crank out more and more pieces of paper money.

This is not a trend that is likely to change in the foreseeable future.


2. The U.S. has developed a culture of entitlement and our demographics make us far less attractive to investors than many other markets.

I am part of the problem. I’m a baby boomer who will be a productive, tax-paying worker for several more years but for most of the rest of my life—which will hopefully be several decades—I will become an expensive national liability consuming social security, Medicare, and other entitlement dollars.

I am not alone. It seems that countries like Brazil, India, Taiwan, China, Korea, Australia and other nations where the average age and national and personal debt levels are much lower are better positioned for growth going forward.

Fortunately, it has never been easier for investors to buy into specific geographies and industry sectors as part of a portfolio strategy than it is today.


3. There is an apparent disconnect between the U.S. economy and the stock market. The market has advanced for eight straight months and hundreds of companies are reporting excellent earnings even as unemployment has risen into double digits and many people remain deeply in debt.

There are actually two trends at work here, neither of which is likely to change in the near term.

First, most companies have eliminated lots of jobs and have cut other costs dramatically. They are more focused than ever on getting more work and productivity out of the employees that remain. From an investment perspective, this trend has helped the business of technology companies and others who provide products and services that enhance productivity and make operations more efficient.

The second trend relates to the weakness of the dollar. Those U.S. companies that do most of their payroll and manufacturing spending in dollars but derive most of their revenues from overseas are doing very well in this environment and are likely to continue to benefit going forward.

4. Interest rates on U.S. Treasuries and government guaranteed deposits have been kept artificially low by federal authorities who are trying to keep the cost of funds to the banks at rock-bottom levels and create the illusion that there is still solid demand for our nation’s debt.

I believe this has created a ticking time bomb for conservative investors who remain heavily invested in cash equivalents and government bonds. At some point, inflation and higher interest rates will have to kick in and when that happens, investors who have sought safety will find that they had the same number of dollars as they did before but those dollars may buy far less goods and services than they used to.


We continue to monitor the economy and the markets carefully and I will keep you posted regarding the situation going forward.