Terrible Washington Post Column

In a piece entitled Obama's New Tack: Blaming Bush the writer Scott Wilson passes along the GOP talking point that Obama's statement of the obvious - that he inherited a fiscal disaster - somehow violates his pledge to move beyond recriminations.

Let's leave aside that a key Republican talking point is to try preposterously to pin our financial problems on Obama rather than Bush, and Obama is merely responding to that. In other words, that he's merely responding to lies. The more pertinent point that the column totally misses is that Obama is merely stating a fact when he says he inherited this disaster. To say that Bernie Madoff swindled people out of their money and caused many to have personal financial disasters is also a fact and not the type of recrimination that Obama pledged to avoid.

Obama pledged to move beyond recriminations based on political philosophy - matters of *opinion*. We should not be recriminating the other side merely for disagreeing with us. That was the point. Not to stop pointing out facts, misdeeds, mismanagement and crimes. That Wilson completely misses this distinction is incompetent at best and corrupt at worst. Or maybe it's the other way around.

Most Lopsided Debate Ever

(Hat tip: Andrew Sullivan)

Best Award Speech Ever

Too bad this would never happen at the Oscars.

One Benefit of the Financial Crisis

A couple years ago, at the height of the market, some new companies entered into my industry (the fantasy sports industry). They were funded by investment (I think venture capital money), and they spent a whole bunch of it hiring people and marketing themselves. They made a nice splash at the conventions because they'd sponsor events and they'd spend money on advertising with other companies. Sure, they had a business plan of sorts, but not a realistic one given the amount of people they hired and the amount of money they were burning through.

Having seen a number of these outfits come and go, it occurred to me that in a good economy, one where there's plenty of extra money lying around, all it really all it takes is someone who is good at pitching investors to create these pseudo businesses. They raise money, throw it around, act like big shots, spend their way into a modicum of market share, then, if the economy's still good, ask for more money; if it isn't, they fold.

One beneficial side effect of a bad market is the elimination of these kinds of entities. It might seem like an industry is losing jobs or productivity, but it's not. I wonder how much of the loss in GDP in a recession is really just the elimination of this kind of bogus activity.

Why the Bailout Doesn't Matter

I was getting worked up earlier about the idea that we're bailing out these incompetent scumbag bankers, auto company managers and delinquent home owners, but now I realize that it's much ado about nothing.

No money is coming out of my pocket presently, and the inflation created by the bailouts is not going to be a problem any time soon. So the real issue is that we, the taxpayers, are going to owe all of this on the back end. Just as Wall Street had its pyramid scheme which wound up with homeowners and banks holding the bag while the execs drained out all the money, we're just adding another layer to the pyramid with the taxpayers taking over for the banks. No problem, when we're asked to pay, we'll just do what the banks did - throw up our hands and say we're unable. At that point, there won't be anyone left to borrow from, and so the government and the world order will simply collapse. Which is what would probably happen now if we didn't give our money to the banks.

So we're buying a little extra time, pretending we can actually guarantee all that debt. Might as well enjoy it while it lasts. Because after the collapse - who the hell knows?

Talk Radio Viruses

I just caught most of Right America: Feeling Wronged, and what struck me most was that the people were repeating talking points they had obviously heard somewhere - most likely on the radio. But not just repeating, but doing so with genuine emotion attached, and believing what they were saying as if it were the most obvious truth.

And it got me thinking that Rush Limbaugh, Sean Hannity and the rest were able to infiltrate these people's beliefs by mimicking their thought patterns, speaking to their common fears and grievances, articulating actual feelings they have, then once hooked, steering them to a particular narrative, e.g., Obama's a socialist.

It's like a virus that tricks your immune system by mimicking it. Limbaugh will mimic the listeners' thought patterns, and once their attention and trust is hijacked use whatever normal skeptical and critical faculties they have against those speaking the truth. So if you say to one of his believers - actually, Obama's a capitalist and his tax plan just differs in terms of what bracket pays what, their skepticism, i.e., their immune system against falsehood, will immediately kick in and dismiss it. Instead of the healthy skepticism fighting bullshit, it's been subverted to fight the truth.

I don't know the long-term consequences of having 10s of millions of people with inverted critical faculties - in the near term it was Bush/Cheney/Rumsfeld/Alberto Gonzalez, etc. - but I doubt they're good.

Kellogg Drops Michael Phelps

Kellogg, the maker of Pop Tarts, Frosted Flakes and a hundred other high-fructose corn-syrup snacks and pseudo foods marketed to children amidst an epidemic of childhood obesity and diabetes and out of control national health care costs, is dropping Phelps? If the executives at Kellog were as good at their jobs as Phelps is at his, every child in America would be obese, and not just the one third that's the case today.

Saving the Newspaper Business

In the New York Times Opinion section today, there's an article discussing the possibility of micropayments as a source of revenue for newspapers.

Essentially, you'd pay a penny for an article or a nickel for an hour of access to a web site, or something like that, and over time that $30 per month you'd spend would fund that paper's journalistic endeavors. But who's got an extra $30 or $50 or $100 a month to pay for that stuff these days? Not enough people to support all but niche subscription sites.

The key to making the micropayment work is to get the payment from the ISP, not the user. Think about it: Cable companies pay millions of dollars to their content providers like ESPN or the Discovery Channel so that they have those channels to to offer subscribers. Why would we be paying both our ISP AND for the content we can get by getting online?

Since our shortsighted and stupid ISPs would never do this (remember, these were the greedy morons who wanted to charge extra for optimal web surfing speeds), what needs to happen is this:

Google realizes that its quest to organize all the world's information is compromised by a lack of quality investigative reporting and journalism. It also realizes that the current ISPs are greedy and shortsighted. So it commissions (with the blessing of the Obama administration) a nationwide network of high speed wireless service *for free*. At this point, everyone paying $30-$60 per month for high speed access now has extra money to be charged a micropayment calculated by Google.

If you scroll down in the Times article above, you'll see that the primary objection to micropayments is that the user will have to go through the trouble to decide whether a given article or link is worth two cents. That wouldn't be an issue if Google added it up for you and sent you the bill - likely $20-$25 per month, less than you're currently paying for access. Google would also sell far more ads and would be hugely profitable. (In the interest of avoiding a Google monopoly, perhaps another company (Microsoft or someone else could offer wireless access in many areas as well).

Problem solved - Newpapers get their revenue, users still pay the same or less for high speed access, and Google/Microsoft/Yahoo get their cut for administrating it and also by selling ads.

The big loses are the telecom companies, no longer charging us for use of their "pipes".

But they had it coming.

Can the Problem of Executive Pay Be Reduced to a Logical Fallacy?

It's well known that executive pay has gone up dramatically relative to the wages of ordinary workers the last 20-30 years, but that in and of itself doesn't mean our current system is wrong. It might be politically problematic, and it might seem unfair, but that's a separate question from whether those executives, particularly the CEOs, deserve their comparatively enormous salaries based on value and merit.

It seems the most basic argument in favor of CEOs receiving outsized paychecks is the "but for" one. But for my being here, the company wouldn't have made x billion dollars in profits. If the last CEO were here, it would have made y billion. So I should get a significant share in x-y billion dollars.

First off, it's hard to know for sure what the former CEO would have done, or more pertinently, an average CEO. But assuming the current CEO were correct, and the company made $8 billion instead of $4 billion that year, shouldn't he be entitled to a bonus of some percentage of the $4 billion extra, say 5 percent? If that were the case, he'd be making an extra $200 million.

Assuming for a moment that the company's profits were sustainable, and the CEO's efforts helped foster long-term growth and not merely growth on paper to boost the annual numbers, I'd still argue that the CEO likely does not deserve such a large cut even if the average CEO would have only produced $4 billion in profits.

That's because the CEO is merely a "but for" cause of the company's enhanced earnings, and not by any means the sole or even primary cause. The company was obviously poised to post phenomenal earnings given proper leadership, and the CEO provided that leadership. But had the company not been amenable to such improved growth, the CEO wouldn't have been able to make the difference.

To use a sports analogy - some teams will win a title only if you hire a great coach. And some won't no matter who is coaching. That a great coach takes a capable team to the title doesn't mean the coach is solely responsible. He is a but for cause. Accordingly, while the coach deserves credit and higher pay than a mediocre one, the team he inherited must also be taken into account.

The idea that a particular executive is worth whatever they have to pay him because without him the company would be doing far worse is a false one. The executive would also be doing far worse without a company amenable to such tremendous growth.

I'm Getting Fucked

There's been a lot of talk about bailing out homeowners so they can stay in their homes and bailing out the auto industry so they can keep people employed and bailing out Wall Street so it won't collapse the economy. (Turns out some of that bailout money is going toward bonuses). But what about the renter who in the face of a huge housing bubble acted responsibly and didn't buy something he could only afford if prices went up indefinitely, and instead put his money into the stock market? Not only did I miss out on the housing bubble, but I'm also missing out on the bailout. In the meantime, I lost 60 percent of my net worth when the burst housing bubble killed the stock market! Where's my bailout? Oh, bailing me out isn't important because I was responsible and will still buy goods and keep the economy going even if I don't see a dime of it.

This really is socialism when car companies produce shitty cars that are bad for the environment, and we bail them out. When bankers take irresponsible risks and we bail them out. But citizens who paid their taxes and their bills and acted conservatively with their money - we're getting fucked. It's a transfer from the responsible to the greedy and the needy without our consent.

Get Michael Pollan a Cabinet Post

Of all the problems facing us today, the destruction of our food supply by corporations and government lobbyists is probably the easiest to fix and one that might have the broadest consequences. As Michael Pollan has written about in his book In Defense of Food, the modern food industry has run roughshod over our eating traditions, and the results have been catastrophic. We're so worried about making health care universal and/or affordable, but we would need only a fraction of it if we just ate properly. But we don't eat properly because our food system is designed for quantity, addiction and profit rather than quality, health and taste. Pollan refers to numerous studies done on the Western diet's affect on people from native populations who had almost zero incidence of heart disease, cancer and diabetes before adopting it. They found that as soon as people adopted our eating habits, they got our diseases.

What's worse, our medical industry works hand in hand with the food industry, creating treatment for symptoms, but rarely addressing the underlying problem. So people take statins for the heart disease they have because they eat processed grains that flood them with too many Omega-6 fatty acids and inflame their systems. Instead of getting off the fake food and eating more organic fruits, vegetables and grass-fed meat, people continue with the Western diet and pay into the health care system. The medical profession has a vested interest in keeping us coming back for more treatment, and the drug companies lavish our doctors with unethical perks to persuade them to prescribe their products.

The good news is that it's an fairly easy solution - educate people to eat properly (not as per the AMA's faulty recommendations - they were part of the war on fats, and actually encouraged transfat consumption over natural products like butter), and watch the need for and cost of health care diminish to a fraction of what it is currently. The main obstacle to educating people on their health is that there's tremendous profit in having us eat processed foods. After all, you can patent the formula to Coca Cola, but you can't patent organic peaches. And growing organic takes more effort, and is harder to do on a large scale. But it's important not only because pesticides are harmful, but also because anything that artificially kills pests and diseases breeds produce that didn't have to develop the defenses itself. And many of the antioxidants that product against cancer and lower the risk of heart disease develop in plants to defend against bacteria themselves.

So there is an enormous vested interest in keeping us buying food from a box and also in using harmful chemicals that deprive us of essential nutrients. To that end, there are companies who commission studies designed to show that pesticides aren't harmful, and who hire lobbyists who make sure the laws on what can be sprayed on food and what can be run off into the environment are lax.

But if the population became truly educated about what they ate, they could vote with their dollars at farmer's markets and collectives - they could grow extra food in their back yards, they could swear off the fast food, and the food from a box. Moreover, they could make it known to their representatives that they want the food (and drug) companies to be held to high standards, and bloggers could call out the worst offenders and disseminate information to the public at large.

But just as President-elect Obama encouraged people to get involved in his campaign by creating a movement for change and setting up the infrastructure, he could also speed up this process of education about health vastly by enlisting his support, encouragement and network. With two foreign wars, a massive financial crises and huge entitlement liabilities, this might seem like a low priority, but it's not. It would solve the health care problem within a couple years by cutting the cost enormously. It would also have an enormously beneficial effect on the work force - people would be energetic healthy and productive - and it would be hugely beneficial to the environment. And there would not need to be a major outlay of cash.

Now that we're only beginning to understand fully the ways in which Wall Street and other corporate interests gambled with our pensions and retirement accounts to rack up huge profits before needing a bailout, it's important to go further and realize that the food and drug industry are doing the same in matters of nutrition and health.

So get Michael Pollan a cabinet post - (or at least a meeting) with our new president.

Obama's Strategy on FISA

Was debating with a friend about Obama's support of FISA - I think no big deal, he thinks it undermines Obama's credibility entirely.

But then I started thinking about why Obama would support FISA since he had to know it would get MoveOn and their ilk up in arms. And then it dawned on me that's precisely WHY he did it. What better way to appeal to the center and center-right than to say: "The far right AND far left are both angry with me." In other words, it's not about FISA or telecom immunity at all. It's about sacrificing a relatively small issue to generate the backlash from the left he needs. It's like microfracture surgery - the doctor scrapes the bone to cause bleeding and create scar tissue to cushion the joint. He's scraping the left just enough to cushion his reception with a significant portion of the electorate outside his base.

It's not his centrist stance on FISA that will win him votes. It's that he doesn't look quite so beholden to the left.

I think that's a good rebuttal to all the pundits who try to argue that supporting the FISA compromise and tacking to the center substantively won't help. No it won't, but their overheated criticism surely will!

When given the choice between believing that Obama is tone deaf and doesn't realize what's obvious to the left-wing pundits, or believing that this black man with a Muslim name who is the frontrunner for president of the United States is playing the game at a more subtle level than they can even fathom, I'll go with the latter. These people are like financial pundits slagging Warren Buffett's stock picks. If Obama weren't the smartest guy in the game, we wouldn't even know who he was.

Send In The Lorax

Because the California Bar Exam is only weeks away, I don't have time to do a proper post.  But I did want to take a minute to note the disgusting irony of the Bush administration declaring polar bears a threatened species as a result of global warming, and only a month later issuing what are in essence grants of immunity to oil companies searching for oil and gas off northwestern Alaska. 

In addition to the obvious link between oil/gas and global warming, the regulations provide five years of legal protections for the named companies if Pacific walruses or the 'threatened' polar bears are harmed by the companies drilling or pipeline activities.  

Guess declaring a species to be threatened doesn't imply we want the threats to cease. 

Victims Forever

There are a lot of reports of Clinton supporters pledging to support John McCain this fall. This is ironic for a few reasons.

First, they know that McCain would almost certainly appoint a pro life justice to the Supreme Court in the next four years, likely overturning Roe v. Wade, something that's supposedly dear to Clinton and certainly most feminists.

Second, Obama's policies are almost identical to Clinton's substantively, and McCain's are virtually opposite. This shows that the decision to abandon Obama is largely emotional - and is most likely driven by a feeling that somehow Hillary was wronged, or cheated out of the election. This idea of Hillary's victimhood first at the hands of an unfaithful husband and then by a right-wing attack machine and finally a sexist press and an unfair primary process, the latter ideas stoked by Clinton herself, has driven some supporters to reject Obama - even though he hasn't done anything sexist and certainly won fair and square despite long odds.

But the final and most striking irony is that because of this, some Clinton supporters are pledging to vote for McCain who abandoned his first wife (who had been disfigured in a car accident) for a younger, healthier woman! I mean of all the people to support - these lost Clinton supporters are choosing someone who actually ditched and cheated on his wife to punish Obama, who is by all accounts faithful to his!

Think about that for a moment - all those people who identify with Hillary as a victim are voting for a victimizer to spite a man whose campaign for the most part took the high road. It's almost as if they resent Obama's lack of identification with black victimhood more than McCain's willingness to overturn Roe v. Wade and his abandoning his wife because she was no longer attractive.

But I suppose that's what the mentality of victimhood is - not merely someone who's been wronged, but one who ensures that the wrong repeats itself and perpetuates one's identity as a victim. And come to think of it, Obama's more of a threat to their identity than McCain is. Obama is a counterexample to them - he shows there's another way to proceed. McCain is the other side of the same coin - he commits the outrages that they feed on. So if McCain gets elected, they can continue to whine and complain. If Obama gets elected, and asks blacks to rise above victimhood, those women are going to have to go along, too - or look feeble and pathetic by contrast. What a nightmare - to have to take responsibility for your own lives!

Clinton Should Not Get Help for Her Campaign Debt

The NYTimes reported today that Clinton has a debt of about $21 million and talks about her options for retiring it, one of which was raising more money from her supporters, another of which was having Obama's supporters help raise money. Both options strike me as ridiculous.

First off, the Clintons' net worth was more than $100 million before the campaign started. Why should people struggling to make ends meet give them a dime? (I'd presume most people who aren't struggling gave the $2300 maximum). The Clintons can retire the debt personally and still have $75 million or so in the bank, with plenty more to come now that Bill's free to continue speaking and having other undisclosed business dealings.

The idea of Obama supporters giving Clinton money is laughable. Clinton was throwing good money at bad long after her only hope for winning was an Obama meltdown. While people have given her credit for "grit" and "determination," in most other endeavors this would just be considered poor judgment - racking up debt in pursuit of a lost cause. And that's fine if she's going to take responsibility for that poor judgment and pay for it out of pocket. But to ask people for money in a bad economy to free her from its consequences is bad form.

The one option not discussed that I'd find reasonable is not to pay Mark Penn the millions he's owed, and when he sues her, to countersue for malpractice - after all, not only did he run a terrible campaign, he was on the Columbian government's payroll, lobbying for a trade deal that Clinton was criticizing. That's a conflict of interest that might void the obligation.

Rehabilitation for Hillary Clinton

This post by "Sean" on FiveThirtyEight.com pretty much articulated my feelings toward Hillary Clinton to a tee.

He wrote this before she made her speech, which ever-so-slightly exceeded my expectations of what she would actually do, but surely fell short of what Sean would deem necessary for her rehabilitation. I tend to agree with him.

The argument is that Clinton poisoned Obama's image in the minds of her supporters by acting like his campaign was dirty, sexist and disrespectful. So even though she's ostensibly thrown her support behind Obama and asked her faithful to do the same, she's done so without healing the perceived wounds. In other words, her supporters still believe that she (and by extension they) were somehow wronged by the process. In that case, they might feel that Hillary has to do this because she's being bullied by Howard Dean, Nancy Pelosi et. al., but that they have still been wronged.

Therefore Sean's argument was for Clinton to heal those wounds by acknowledging that the outrage and emotion she stirred up in her followers were based on lies. And that she wasn't robbed, nor were FLA and MICH and that Obama's not by any means an elitist or a Muslim or a sexist. And that her campaign was the one fighting dirty, while his largely took the high road.

If she were to come clean about that, Sean argues, then maybe, possibly, he could see her in a different light.

But she didn't. And so now it's left to Obama himself to reach out to her supporters, and that's going to be far more difficult because she didn't come completely clean.

The more I think about it - it seems that this really isn't over, and she might, over the next six months, subtly undermine him with an eye on 2012. I hope I'm wrong - and that this wasn't a calculated half measure - but instead the best that she could do given who she is.

Get Lost Carl Icahn

I don't know a whole lot about the business of large company mergers and proxy fights, but it strikes me that Icahn should mind his own business and leave Yahoo and its board alone. Who is Icahn - some entitled billionaire who feels the need to buy a large stake and force yahoo to sell Microsoft? Apart from Yahoo shareholders, who stand to see their stock get a bump in the short term, who does that really benefit? Do we need more consolidation of the search business at the top? Are consumers really that ill-served by Google's dominance of the search market? How so?

My only experience with Yahoo is in our business dealings with them at RotoWire, and they're one of the best, easiest and least pretentious big companies we deal with. It would be a shame if they were sold to a company widely reviled as a bully that puts out a mediocre product.

Short-term shareholder value shouldn't be the be-all, end-all of business. I own Yahoo shares, and I don't care about the short-term profit I'd get if Icahn's plan were to go through. I'd rather see the company stay independent.

Perhaps I'm naive here, but hearing Icahn rip Yahoo's management and try to force them to accept Microsoft's since withdrawn takeover bid rubs me the wrong way. What does he even care? The guy is a billionaire already - what good does this do? As usual in mergers, people will lose jobs, and sometimes that's necessary in situations where the underlying business makes no sense, or the merger is highly beneficial to both companies. In this case, Yahoo doesn't want to merge, unless they're blown away by the offer, so why force it?

Getting Views on YouTube

I recently uploaded a six-minute excerpt from my feature length documentary, and I figured by sending it out to all of my friends and business colleagues, as well as posting it on the RotoWire blogs I'd get enough traffic for the clip to go viral. I was wrong - at least for now, and the clip is stuck at about 885 views with more trickling in slowly each day. This was a far cry from the 200,000 I had hoped to get in order to attract the attention of potential distributors.

So I did some looking around the web to find good sites to send the clip to, better search tags to add to it and whatever else I hadn't thought of. And I found this site, Tech Crunch, which no doubt offers sound advice if boosting your views is your main objective.

Suggestions on Tech Crunch include: logging in under many different YouTube usernames and generating fake commentary about your own clip, logging onto message boards with several different usernames and getting into heated discussions about your own clip, etc.

And I thought this was funny because I was feeling guilty at clicking on the video from different browsers and thereby generating multiple page views myself. My naive idea had been that my clip and documentary were actually good, and so once I sent it out to a few hundred people, naturally they would forward it along, and it would blow up. But Tech Crunch pointed out that:

There are tens of thousands of videos uploaded to YouTube each day (I’ve heard estimates between 10-65,000 videos per day). I don’t care how “viral” you think your video is; no one is going to find it and no one is going to watch it.

And so you have to game the system to get your video to the top of YouTube or onto key lists where it will be recognized. Which I thought about doing for about 10 seconds and then rejected. It's fake! It's cheating. It's fundamentally not merit based.

But what if through cheating you're able to get something you genuinely believe is good and worked very hard on for years into public view. Surely, the end justifies the means?

It's a fair argument, but I just can't get behind it. Pretending people like your clip is bad for the system, and while plenty of other people do it, it's fundamentally because they lack faith in their creative ability and their ability to adapt and market in an honest way. I'd be thrilled for instance if some big-time blogger picked it up and it spread that way. The key is that people send it along because they genuinely enjoy it.

Sundays Are for Football

Excerpt from the 68-minute feature length documentary on the Hollyweird Fantasy Football League.

Letter to the NY Times re: Clinton's Kennedy Gaffe

While friends of mine worried that this unstable person would destroy the democratic party in her own pursuit of power, I reassured them that like Eight Belles at the Kentucky Derby, she would push it too far, and her campaign would have to be euthanized on the track. I didn't foresee this specific gaffe - only that as her hopes dimmed, the inner sociopath would emerge, and that all but her most committed supporters, people who were dug in beyond all reason would jump ship. The folks at Slate.com compared her to Reese Witherspoon's Tracy Flick in "Election," but I always felt the far more apt analogy was to Gollum in "The Lord of the Rings." "The ring is mine!" she seemed to say with every outrageous tactic and divisive maneuvering.

It seemed so strange that the NY Times and other mainstream media didn't see what was so apparent to so many. Perhaps Frank Rich saw it, and Andrew Sullivan at the Atlantic, but so many others kept saying: "We have two great candidates" no matter what kind of campaign she ran, no matter what kind of vitriol her petty and vindictive advisors and increasingly unhinged husband shouted. The Times endorsed this person, and didn't retract it in the face of so much evidence. And now, it's plain as day, thankfully, but this was there all along.

Whether people out of political correctness due to the historic nature of her campaign didn't want to point out that the empress had no clothes, or whether people were really that cynical about politics to be duped into believing that just about anything goes, it's hard to say. But, and I've made this point many times - just because she's a woman does mean she's not a sociopath, and her supporters do a disservice to the many genuinely wonderful female candidates who will surely come after her by sticking with her this doggedly. Clinton and her supporters are making it more difficult for female candidates to get their due by allowing identity politics to cloud their character judgment. As Martin Luther King dreamt, people will one day be judged by the content of their character, not the color of their skin, and I believe the same thing can be said about the configuration of their chromosomes.

Surely we only want a quality African American candidate like Obama, and just are surely we want a decent female candidate, not just the first available one.

May Clinton's campaign rest in peace, and may we look forward to a female president whose ambition is balanced by decency and integrity.