Category Archives: American Innovation

Business exists for the Sustenance of Mankind

For those that continue to harp that businesses do not exist for the purpose of creating jobs, let me set the record straight. Business has the responsibility of 100% effective and sustainable employment. In this “modern” era, mankind has fallen susceptible to the idea that business is an organism coexisting in time with men, finding arms lengths symbiosis whereby each feeds off the other but neither have a responsibility further than from what can be gained.

This odd paradigm that business does not have the purpose of creating jobs is an erroneous fiction of our time. While it may be quite true when viewed from the perspective of an individual business including the sole purpose of its owners and managers to make profit, the idea that the purpose of business does not include providing employment is one that has mutated in the evolution of the era of individualism.

Before our time, in the era of Kings, men held other misconceptions such as the purpose of land. It was widely held that land should not provide each serf his own castle but instead should connect all in servitude to the king (similarly to connecting all mankind as a series of batteries connected by wires to provide the electrical power for the nation of computers as seen in the movie “The Matrix”). Kings would grant temporary sharing of power to corporations to reward those who would risk life to advance the kingdom.

Yet in their quest for more, Kings allowed this power sharing to gain a foothold and their power spread too thin amongst the businesses. In this devolvement of power, the era of kings diminished and the era of fiat money derived from gold renting rose. With it, a new paradigm of business came to being. Businessmen gathered the trappings of power; money, ideas, inventions, innovations, labor, these were those that provided aggressive men the means to acquire kingdoms unto themselves. Yet in the beginning, these new mini-kingdoms existed within the realms of the nation-state, still subject to the whims of the king.

Ultimately, as businessmen acquired a majority of power, they demanded and received their due. A new paradigm arrived whereby these captains of industry exchanged seats with the rulers and the rulers bowed to them, becoming puppets to their whims instead. Now the new kings of business shared their power with the people to hold them in abeyance. But as the masses rose in opposition to workplace excesses, power once again shifted and all prospered in a moment of whimsical balance created only by the transfer of time and power toward its ultimate destiny.

We now have a period of imbalance that will only worsen over time. Businesses will continue to garner power from the transition toward the corporate state. And with the power shift, the middle class will suffer even more from this unnatural imbalance. Mankind is meant to be communal. Not that all should be equal or share equally but that all should contribute to the common good. Systems that provide that opportunity include businesses. Business owners are cogs in the wheel of life and have the responsibility to employ all in the community for the common good.

Yet individual businesses should not have to employ any more than that which is needed by increased innovation and productivity. Therefore, if excess unemployment exists, an artificial constraint, unnatural, ungodly, and unsustainable exists; one that is only imposed on man by those that would seek to enrich their own mini-kingdoms. And now that the era of kings is dead, those mini-kingdoms hide out in the marshes of government bureaucracy. Therefore, the bindings of government that have created it must be loosened, and a new paradigm of mutuality between government and business must be created with the outcome of full employment.

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Filed under American Innovation, Bureaucracy, Full Employment, Job Voucher Plan, Jobs, Multinational Corporations, social trajectory

The Thriving Path

America is crawling away from the fires of our crisis of 2008. Yet, even in what seems like a slow reversal, we are not assured of recovery or even survival. Our choices to revive our economy thus far have left millions suffering in their wake and millions more treading water. We must therefore commit to using this economic lull to assess our best path forward if we hope not merely to survive but to thrive, as we know America can, on the other side of the crisis.

The thriving path forward will require America’s factions to commit fairly soon to pull together as one nation to solve our serious problems. Yet, our government and businesses seem almost paralyzed to act, as if in fear of hastening doomsayers’ disastrous predictions, as if these doomsayers’ have overpowering incantations to hold us in stalemate. And for most Americans, our nation’s problems seem overwhelming in size and complexity. For every answer that seems right to us, we hear just as many adamant opposing views.

Can it truly be that the problems facing America are too great to correct, greater than all the incredible odds that we have overcome to date? As we hear the beat of the doomsayers’ drums proclaiming the fast approaching end of America, are we to fall prey in a frenzied fire dance of fear that their learned visions of our dire future are somehow more likely than the thriving path? If their learned visions were so clairvoyant, why did so few attempt to stop America from falling? If their proposed solutions are so right for America, then why are we so entangled by the snares of their proposed paths?

Let me be clear. We Americans know that most of the solutions touted by our leaders today serve only to fix one set of problems while exacerbating or creating others. Our nation’s problems are indeed severe and we are right to devote single-minded attention toward answers for America’s future. Yet the current batch of solutions seems weak because they are weak. The strong ones are waiting on the determination of the American people to draw them out of our government in compromise if we are to right America’s course.

I am here to shout that America’s problems are by no means unfixable. If we dissect this conglomeration of issues into defined, finite ones, examining causes as well as interconnections with other problems, the answers will become clear. But once optimal answers are understood, Americans must have the will to follow through.

The will to follow the thriving path necessarily means holding our leaders accountable to place America’s future before their own. If we can agree on just these few guiding principles moving forward, America will endure our current crisis and will continue forward on the thriving path toward our destiny as the shining city on a hill.

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Filed under American Governance, American Innovation, American Politics, Bureaucracy, Economic Crisis

Has America Become a Headless Zombie?

I guess I am becoming more convinced that both the conservative and liberal movements in America are bankrupt. Americans pick our teams and cheer them on like we are high school rivals. Yet have the Republicans really helped most Americans succeed or is Middle America being left behind? And have the Democrats uplifted the down trodden or even helped to save a smidgeon of their hard earned equity in America’s future?

We know America has been sliding for the past forty years. In all that time, which movement created a true vision of America leading the world toward a brighter future? Which drew all Americans together toward a common goal? We heard the catch phrases for the past twenty election cycles, but who backed up their words with unifying actions? Which movement rallied us to any cause? If we are to be honest, which was the last to truly inspire America?

Which movement stood up for Middle America? Which protected our economy from elitist gutting? Which has made any real attempt to create a fair process of keeping Americans in their homes and in their jobs? Which saw the demise of our factories and jobs while the decay was occurring, and made it a priority to return America to prominence before we fell into crisis?

Which even attempts to project a comprehensive understanding of the dilemma that America faces? Which is really going to take on the Chinese now that we have let our economic horse out of the barn? Which has made any effort to protect our country from the coming dollar plunder? Which has earnestly attempted to help America become less energy dependent? Which has prioritized balancing internal defense, border defense, homeland defense, and national defense while preserving American’s freedom, including our economic freedom?

Which movement has led the way toward a productive and competitive America? Which stood for savings, responsible government, reinvestment, retooling, and modern education? Which has since prioritized our government spending and created a sane way toward fiscal responsibility? Which is talking honestly to the American people of the shared sacrifice it will take for America to recover?

America has become a headless zombie. Our best and brightest entered the international financial lobotomy track. They proceeded to take our future overseas and our headless public servants aided their robbery. Which stood up to the corporate and banking mobs who stole from us before our very eyes? Which held international banks to the fire afterward and required that they share in America’s sacrifice? Which is calling for our businesses to show social responsibility? Which truly took on the Fed for its reckless behavior?

If Americans are to be honest, we would have to answer neither movement to the questions above. None of us feel very good about our home teams. And the other team doesn’t look very promising either. If this were a real game, we would all be hoping that the half time show would cheer our woes. But it is not a game.

Loyalty is earned and I just don’t feel a loyalty to either movement. When America’s leadership reattaches its brain and heart, perhaps America’s zombie attack will be over. We might even see a movement emerge to form a new party from which the American people can rally around. That party might possess the vision to lead once again.

Will leadership have to bubble up from the next generation when America hits rock bottom? It appears to this humble servant that headless zombies are entrenched in both parties and that transformational leadership does not exist within their current ranks. The next four years are guaranteed to bring adversity. We can perhaps only hope that amongst the ranks of Presidential and Congressional hopefuls our coming adversity will force true transformational leadership to rise up to meet it.

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Filed under American Governance, American Innovation, American Politics, Economic Crisis, U.S. Energy Policy, World Sustainability

On My Birthday, I Agreed that America is Nowhere near Middle Aged, So She Should Stop Her Midlife Crisis

I celebrated my 51st birthday yesterday surrounded by my 5 kids. They took me out deep sea fishing (caught a 5 foot black tip shark) and made me sweat with a tennis pro before going to the spa, having a terrific dinner out and finishing with a night of gift giving. It was such a great day that I almost forgot I was 51.

When I turned 50, I made believe that it was just one step away from my 40s. At 50, I tried to deny that my vigorous youth was slipping away or that my powerful purchasing parity had peaked its prosperity. I was not ready to accept that from this point on, I would slide ever so slowly down into a slumbering non-existence.

But now at 51, I am squarely surrounded by 50 and 52. I must acquiesce to the fact that my more virile years may be behind me. I must settle down from my midlife crisis, finish my mourning for my hegemonic mid years and begin to accept that where I am at 51 is a new beginning to finding peace, productivity, and prosperity in my last quarter century.

America is but 235 years old, hardly in my position. America is not a nation heading for its golden years as many would have you believe. Why is she acting like me, pouting about her aging features? Why is she accepting her fate as it is being told by those who have hijacked our future? Are we really in our midlife crisis or have we been hypnotized by those who would have us believe we must willingly hand it over to those fledgling industrialists to the East? Who reading this post truly believes that the Chinese are better able to lead the world into the 21st century than America?

If so, state your case. As for me, even if I have but a quarter century left to give to my country, I intend to make it a virile thrust for America. Remember folks, in 235 years, America could only stack a baby born in 1776 on top of a baby born in 1856 on top of a baby born in 1936, just three short lifetimes. America cannot possibly be in our golden years when only three consecutive people have lived their lifes as Americans. So snap out of it. Shake off the psychological bindings that international globalizationists would like you to bound with for their hegemonic slaughter and get back out there and fight for America now!

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Filed under American Governance, American Innovation, China, Innovation, Jobs

President Obama’s Jobs Bill Joins the Republicans’ Job Plans on the Dusty Shelves of Uninspired Visions

While some of the ideas in the President’s bill have merit, he knows that his big government approach will not have support from Republicans and will die on the cutting floor of the political process. Neither the Republican’s ideas for job creation by tax and regulation derivatives nor President Obama’s big government jobs bill deals with the underlying consumer demand, business and consumer credit restrictions, and housing and consumer debt issues that have stymied our nation’s demand for jobs. Without removing these major obstacles or creating an environment to sustain demand for a new products or services, any proposed solution will be a temporary band-aid that increases the debt and that delays providing real, implementable, and effective solutions.

I am therefore beseeching both parties on behalf of the American people to put us first. Meet in the middle with win-win proposals that will solve our nation’s jobs dilemma. Go back to the drawing board, be inventive and be bold. Thus far, our government has fallen far short of our needs, but we will count on you to try again and to succeed. A review of the President’s jobs bill follows.

The president’s bill adds $452 billion in new stimulus costs that have minimal permanent job increases and that creates new agencies such as the American Infrastructure Financing Authority and the Public Safety Broadband Corporation to administer new programs that will add “government” jobs through a larger government approach.

His plan will save some government jobs that might have otherwise been pared down to match the realities of permanently lower state and local budgets as a result of popping of real estate prices and subsequent taxes. It will also move construction work forward in time to add jobs near term at the expense of longer term jobs and will fund some jobs that otherwise would not occur by increasing government spending.

The employer/employee sections of the bill will provide temporary stimulus across the private sector to workers and owners. It will also incentivize bringing private industry investment forward to 2012. In addition, it incentivizes shifting employment from civilians to returning vets. However, because of the temporary nature of the stimulus, the provisions have little impact on new jobs.

The teacher and first responder stimulus does keep workers in place for those municipalities that would lay off these workers as part of paring down their oversized governments. However, the effect of these provisions is to delay needed cuts in local government budgets that grew too large as they took advantage of windfall property taxes from the housing bubble that increased their budgets beyond historical norms to increase their employee base. By covering teacher and first responder pay, the plan enables other areas of local governments to continue on when they should otherwise be cut.

The school construction stimulus has the combined effect of advancing the President’s agenda of redistributing wealth to the disadvantaged and to improving learning conditions of schools while at the same time providing short term stimulus to the building construction industry by increasing federal government debt.

The infrastructure construction stimulus has the combined effect of improving deteriorating infrastructure and providing short term stimulus to the infrastructure construction industry while advancing the President’s agenda of shifting government contracts to disadvantaged businesses that hire a greater percentage from lower socioeconomic classes, job retraining for those with less skills, and support for state and local budgets by transferring their costs to the Federal budget.

The Infrastructure bank provisions allows for infrastructure construction to be done on credit over time as opposed to being paid by ongoing budgets. The effect will be to increase short term employment but also to increase the federal debt by bringing forward billions of dollars in construction. The provisions also advance the President’s redistribution agenda by providing $15 billion to purchase excess housing and make it available for low income housing rentals.

The public safety broadband network is an admission that the billions invested thus far in our nation’s public safety networks for interoperability have not been successful and must be given a broad stroke of expensive and inefficient transfer of resources to a new federal agency. It also advances the slippery slope of selling off government assets to pay for our debt.

The extension of unemployment benefits extends a disincentive to remain unemployed without giving the unemployed real opportunities to find employment. The other provisions of the return to work sections have merit but are not bold enough to have a substantial impact and, as a result are a costly option for minimally improving employment.

The anti-discrimination section adds ineffective regulation to already bulging base of regulations.

Details of bill:

Employees and Businesses

Sec. 101. Temporary Payroll Tax Cut for Employers, Employees, and the Self-Employed – increases consumption across the board for calendar year 2012 but savings may be hoarded because of economy concerns.

Sec. 102. Temporary Tax Credit for Increased Payroll – provides a one year tax credit to employers. Not sufficiently long to make long term hiring decisions but could help increase temporary employment.

Sec. 111. Extension of Temporary 100 Percent Bonus Depreciation for Certain Business Assets – could accelerate certain business asset purchases into 2012.

Sec. 112. Surety Bonds – Increases size of projects available to small businesses at reduced bond costs that has the effect of shifting workers from larger companies to smaller ones – little effect on increasing employment.

Sec. 113. Delay in Application of Withholding on Government Contractors – Delays collection of government funds that ultimately must be paid – little effect on increasing employment.

Sec. 201. Returning Heroes and Wounded Warriors Work Opportunity Tax Credits – Incentivizes hiring of veterans over civilians which may be necessary as we bring home soldiers. On the margin, may influence hiring but should have little effect on increasing employment.

Sec. 202 -215 – Teacher and first responder stabilization and First Responder Stabilization – $35 billion – The goal is to stabilize employment but will have little effect on increased employment.

Sec. 221 – 231 Modernizing Schools – $25 billion – Repairs schools, allocates a significant portion to schools with a high percentage of students below the poverty level – The redistribution program funds repair of educational facilities – As the funds are supplemental to other programs, it should increase construction jobs

Sec. 241. Immediate Transportation Infrastructure Investments – $27 billion – for highway projects, $2 billion – for airports, $1 billion – air traffic control – transfers construction jobs from later years to 2012, $4 trillion for high speed rail, $2 trillion for Amtrak, $3 trillion for general grants – allocates a third of the funds to disadvantaged businesses. Adds expenses without fitting into a national improvement plan.

Sec 242-259 – American Infrastructure Financing Authority – Establishes an infrastructure bank that funds the development of new infrastructure estimated to cost $225 billion a year for the next 50 years. – The bank allows state and local governments to build infrastructure on credit that is paid over time. Substantially increases national debt to narrowly fund employment in a specific industry.

Sec. 261 – Project Rebuild – $15 trillion – Allocated for local governments to purchase and maintain excess housing for low income individuals to rent.

Sec 271-278 – Auctions of Spectrum and Spectrum Management – Auctions private use of government spectrum for additional government revenues. Advances the slippery slope of selling off government assets.

Sec 281 – 299 Public Safety Broadband Network – Creates a national public safety broadband network that is managed by a new authority, the Public Safety Broadband Corporation to develop a federally mandated interoperability among safety workers. Provides funding to pay for inefficiencies of transferring to this network. Some initial jobs will be developed to create the infrastructure and systems. The cost and inefficiencies of transferring billions of dollars of existing infrastructure is not appropriately discussed.

Sec. 311-316 – Extension of Emergency Unemployment Compensation Program and other unemployment programs– extends unemployment benefits another year and provides other unemployment assistance

Sec 321-331 Reemployment NOW Program – Provides supplemental funds to subsidize employment – Could provide temporary job growth.

Sec 341 -346 – Short-Time Compensation Program provides unemployment for workers that get less hours in lieu of being completely laid off – Provides some flexibility and reduces full effects of unemployment.

Sec 351 – Long-Term Unemployed Hiring Preferences – Provides tax credit to hire long term unemployed, incentivizes shifting hiring from short term unemployed to long term unemployed.

Sec 361 – 368 – Pathways Back to Work – Provides $5 billion for employing and training disadvantaged youth and low income individuals.

Section 371-378 – Prohibition of Discrimination in Employment on the Basis of an Individual’s Status as Unemployed –creates new regulations prohibiting not hiring because of a person’s unemployed status

Sec 401-451 – Reduces tax deductions for higher income individuals and repeals other deductions and subsidies plus an increased target of the joint committee to pay for the bill’s costs.

SEC. 4. Buy American – Use of American iron, steel, and manufactured goods – Must use American goods unless the cost will increase by more than 25 % or not enough goods eg. Steel, exists in America. This is a capitulating and insufficient clause to deal with the deeper issues of non competitive costs and insufficient supply.

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America is Beautiful

America! America
is truly graced,
a nation steeped in religion
believing God’s love is reflected in her people.

With a history of goodness and flaws
tended to by the desires of her citizens for perfection in law
providing a humble dwelling of freedom’s respite for every soul.

Militarily mighty yet struggling to prove her force
is held well beneath its conquering strike.
Her soldiers committed to each other and love of country,
no such nation has commanded such before
yet enabled a compassioned respect for civilization.
Such is humble nobleness defined.

The days beyond us are marked for America’s rise.
Although each bend exposes a torrent
not unlike rapids we have faced.
Unwavering we have stood down troubled waters
And will with fortitude calm them until
what many say our divine calling is met.

The imaginings of our founders to tame our wild horizons
are still impassioned in the veins of Americans.
We claim this history as we expand the visions of science unknown,
and offer our uncovered understandings to the world’s village.

We will continually fall from grace for selfish gain
but it is our better nature to raise our banner of the free
in which we ask the world for hope.
America, God shed his grace on thee
and crown thy good with brotherhood.

We once again embark upon the calling of America’s gentlest
to take upon themselves the nobility of leadership
for America and the world
from sea to shining sea!

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Ironically, Trickle Down Economics Trickled Down America’s Future

America is a land of irony. We are filled with capitalists whose intent is to accumulate all the wealth the world has to offer, and at the same time, we also have an altruistic nature that tears at our capitalistic infrastructure. We defend our great society and fund outreach to other nations through our tax dollars. We support our dreams of a united earth through a funding of the United Nations and fund our version of world peace through 1,000 military bases dispersed throughout the world. To grow our middle class, for the past thirty years we have supplied enrichment to our upper class to have it trickle down.

Supply side economics is an irony of political invention as well. Its invention of thought intended to provide extra capital to America’s private sector, the sector that creates taxpaying, productive jobs that extends America’s know how, innovation, skills, and gross domestic product. In our world’s current economic system, when a venture is started, some seed capital that has been accumulated by the world’s elite is then combined with borrowed money created from thin air by banks through the venture’s promise to repay. This devised modern structure of government and banking thus provides the investment needed to fund the venture’s infrastructure and start up expenses, including the financial support for job creation.

The wealthier of our country are those that have traditionally been able to accumulate more money than they need to fund their daily expenses, and thus they have provided the seed capital for ventures through their investments. Instead of the entrepreneurs that risk all to build real wealth and create the jobs, Supply Side economics instead provides tax incentives to the wealthy, ironically giving credit to the capital providers for producing America’s jobs. However, capitalism knows no patriotic allegiance. Investment capital will flow to the highest risk adjusted returns regardless of national borders.

After America’s obsessive military buildup made international investments safer, international business became safer investments in the sixties. Opportunities grew wildly after China opened its borders to investment in 1978, creating a gold rush that attracted loose investment capital from the entire world, building tens of thousands of factories that enriched international investors dearly.

So when Reagan Supply Sider legislators passed tax breaks to the “rich”, their trickledown theory wasn’t wrong, it was just decades late in adjusting to the realities of risk adjusted investment opportunity. Ironically, instead of trickle down, America’s tax policy resulted in pouring out, not a trickle but a fire hose gushing toward foreign shores. Trillions of dollars, created by burdening our middle class with excessive debt, left our economy and were converted into factories and other infrastructure such as roadways, bridges, and cargo ships to enhance China’s economy and to increase their employment base.

It appeared at least temporarily that America profited from our supply side doctrine. An entire industry was born to find ways to collect the extra capital and distribute it to the East. America surely got interim jobs in the financial sector to support this fire hose of foreign directed money flow. Yet, decreasing taxes for the “rich” created much fewer permanent jobs in America than it could have, passing the greater load of jobs to the East. It provided America interim financial and deal flow processing while accomplishing the opposite effect than was hoped for to America’s real economic future.

Ironically, Trickle Down Economics Trickled Down America’s Future…page 2 of 2….Worse, when those permanent jobs left our shores, so did decades of investment in our schools and education that every American has paid for through our contract with America. Each of us has voted to contribute thousands of dollars to our school systems to educate our youth. We do not publicly fund our educational system out of altruism. Americans understand that in educating our youth, they will learn the lessons provided by educated Americans before them. They will carry forward the knowledge that grows in our businesses to learn new theories and methods and to discover new scientific breakthroughs that will extend American technical capabilities. We invest in our children to grow our country’s GDP and to support both those that have come before in their turn at retirement and those that will come after who will raise their families in freedom and who will extend our great country’s experiment in democracy.

Ironically, beyond those trade secrets and innovations that are deemed highly responsible for national security, America does not have a policy about those innovations created in America that have been funded by at least 12 years of public schooling if not more through Pell grants, student loans, state school subsidies and other methods. America has an equity stake in every innovation created by Americans and yet we let them go as freely as we let our commodities be dug up from our patch of earth and be sold out from under us through private, foreign country based businesses operating mines on our public lands today.

However, the greatest irony is yet to come. In letting our capital be funneled to China, in letting our jobs transfer to her, in freely handing over our trade secrets, our innovations, and our scientific breakthroughs, we have transferred decades of core skill and national wealth building capability that will now build in China and not in America. The tax base that would have supported our great society social needs will now support those of China. The extra funds that could have supported our government’s international outreach will now support hers. Our altruistic capability will diminish purely from our trickle down tax policies.

And the great investments that our capitalists hope will provide gold rush returns from the trillions of dollars of investment extracted from the debts of all Americans, turns out they may be the greatest Ponzi of the 20th century. Those trillions of dollars now rest on China’s soil as hard assets. They cannot be dug up from the earth and planted back in America. The financial returns that investors hope for count on China remaining strong to honor her commitments. If China defaults, no one will travel to China and take a piece of the infrastructure back home. There is no international bankruptcy court that can enforce repossessment or repayment.

China’s ability to produce repayments of direct foreign investments depends on America’s ability to stay solvent and to continue buying Chinese goods, yet our solvency rests close to the precipice. If our current economic crisis is thrust off the cliff by short sided, self seeking politicians, America’s default will lead to China’s default and all the profits that our investors dreamed of receiving will disappear in the crash. The underlying assets and intellectual capital that transferred to China in the 20th century gold rush will remain there for China’s eventual rapid recovery while the trickle down and fire hosed out financial capital that left America’s shores will have ironically vanished with our gold strike dreams.

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The Right Alternative Energy Policy is Critical to America’s Survival, the Wrong Policy Could Hasten Her Fall

A buddy of mine built his Taekwondo studio several miles from the nearest city sewer system. However, city policy required him to connect to the sewer rather than to use a much less costly septic system. The additional cost imposed by the city to run several miles of pipe that would be large enough to handle the sewage of the population that would eventually make its way out toward his studio made building at that location cost prohibitive given their regulations.

This example demonstrates two things; one the cost of regulation sometimes means the loss of otherwise viable businesses. Second, the way America goes about infrastructure development can impact how we view the competitiveness of businesses. In the taekwondo example, this man belongs to an association of over 1,300 studios and has the most profitable of all the studios in the country, yet the irresponsibly misplaced infrastructure policy of the city made it appear otherwise.

When I left the energy industry back in the ’90s, the cost of electricity made from wind was about 160 percent of the cost of that made from natural gas. Therefore, based on economic proformas, no business would logically invest in wind power. But what made wind energy more expensive? For one, the cost of placing electric lines out to wind projects to connect them to the grid made them less economical. Certainly, if there were much larger wind farms using the same electric grid, the cost of connecting would have been much less and the viability of wind much greater.

Another issue with looking at alternative energy purely from an MBA’s spread sheet is that it does not care about the nation state, only the industrial state (our burgeoning multinational corporations). When two thirds of the cost of an oil fired power plant’s electrical energy is sent to Saudi Arabia, the transfer of wealth from America to the Saudis is not reflected in the calculations. The above the line profit benefit may be greater to the company with oil fired power, but that may not translate to the economic benefit to our nation state, America. Without understanding that the two motives are different, the United States will continue to be dictated to by nonaligned motives of our MNCs to the detriment of our future viability as a nation state.

Additionally, by not looking at the potential lifecycle cost of oil as it relates to the exponentially growing demand for oil and the parabolic reduction in supply of this dwindling resource, we are potentially creating a nationally damaging bias toward hydrocarbonically created electricity. Hydrocarbon fuels are facing an exponentially increasing price that is not reflected in current utility business models that base decisions on relatively short time frames. At some point, the exponentially growing price of hydrocarbons will make the less steeply growing price of a more highly capitalized alternative energy plant competitive even from an MBA perspective.

This potential presents several issues. First, if America is caught off guard by quickly rising foreign fuel prices having failed to invest in alternative energy technology and having failed to build the capacity to react quickly with new sources of energy, the cost to America of much higher energy prices over a long ramp up time will be much greater than the additional cost of investing now to create a technological base for alternative energy.

However, the way we go about investing in alternative energy is just as important as the fact that we should be investing now. A recent post discussed that China was building a wind energy farm in Texas. How is America building technological expertise when we export technology development to China? How is America reinvesting maximum dollars back into American resources by investing in China’s wind energy company? This is one simple example of how a national strategy of alternative energy development can have a horribly ironic and ineffective implementation when the overall goals of our national strategy are not carried out through all aspects of development.

If we are to achieve a sustainable America into the 21st century, America must vigorously pursue an energy policy designed to enhance our nation’s core skill in producing alternative energy. It must think in terms of the nation state and not our highly political and well lobbied industrial states. It must pursue scale of grandeur that creates economies of scale instead of continuing to compare projects on a flawed vision of limited size. America will soon face a future of capacity limited by our failure to plan for diminished hydrocarbons and our short sided vision, resulting strategies, and flawed implementation driven by highly manipulative industrial states that our courts have given citizenship status could be our down fall if we do not recognize it in time to react.

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The Rise of the Industrial State – The Fall of the Nation State

Up until modern times, individual greed suited the village, the city-state, the feudal system, the nation. Each nation provided for the betterment of its people, through internal and international trade, war, and mercantilism. The greatest of history’s ancient capitalists were the nation builders who attempted domination of their known worlds through conquest. All failed prior to the industrial age because the energy required to capitalize the value of their worldwide sphere of influence was greater than could be compiled by the organization of vast armies. Worldwide domination could not be accomplished by 1,000,000 or so manpower.

The captains of industry that emerged from the industrial era did what no other capitalist had done since the dawn of time. They controlled not only the energies of man, both bodily and intellectually, but enslaved energy from the bowels of the earth to multiply man’s productivity a thousand fold. Through industry, they could grow industrial empires to eventually harness not only the energies of their nations but of the entire world.

Early in the industrial revolution, this power was contained within the geographies of the nation states. Prior to WWI, colonization fed raw materials from other nations through machinery contained within industrialized nations. Wealth was dispersed to machinery workers and taxed for the benefit of the nations to support their under classes. While the enslaved hydrocarbonic energy of industry had the power to grow exponentially to dominate the world, its time had not yet come. First, hydrocarbons had to be tested by the unbridled desires for nation building that had dominated the centuries before.

Captains of statism still controlled the lives of mankind. These leaders of nations did not yet understand the ultimate power of industry. They thought it could be transformed to once and for all dominate the path to world economic power that had been unsuccessfully attempted by all the previous conquerors in history. This newfound harnessed energy that multiplied man’s output could perhaps be used to capitalize the world’s value through worldwide domination using energy to multiply the power of assembled armies to more than 1,000,000,000 or so hydrocarbon energy enhanced manpower of warfare. Theirs was the grotesque hydrocarbon experiment that had to be played out in the early 20th century.

Great energy driven wars were wrought to subdue the world’s geography. In the end of two great wars, 80 million people had been killed and twice as many maimed in the attempt to control the world’s economies through hydrocarbonized warfare. The captains of statism had assembled great armies accompanied by war machines that directed hydrocarbonic killing contraptions of historic proportions. Modern warfare had ironically made massive armies obsolete, and had castrated the world conquest dreams of most of the statist capitalists.

Yet one nation state above all others, the United States, capitalized energy driven warfare for the benefits of its citizens, dominating the transitional era from that of the nation state to that of the industrial state. Through its obsessive militarized harnessing of the power of hydrocarbonic war, America subdued all other nations within its desired sphere of influence. The demolishment of human capital by the end of WWII and America’s monopoly of the military complex gave way to the transition of the rise of industrial states.

The error of the America’s strategy was that industrial capitalism could not be bound by the geographies of state. Although isolated pockets of multinational corporatism had existed prior to WWII, especially in the oil industry, from the 1960s to the present, multinational corporations expanded exponentially. As they did, corporate taxes that nation states had previously counted on to sustain the needs of their under classes, could not be as easily derived as MNCs, these growing industrial states, expanded across geographic borders.

Commerce is driven by profit motive. Profits had served capitalistic nation states well for centuries because growing wealth of industry could be harnessed through taxation to serve the needs of a nation’s people. However, as industrial states began to cross geographical borders, the ability of nation states to feed off their profits was diminished. And as world-wide military subjugation of “rogue” nation states continued, and threats to world commerce was subdued, ironically industrial states began to value the protection of nation states less.

By the 1960s, all that was to be done to mop up the world’s major commercial threats was to subdue the soviets across the world chess board while isolating other non-capitalist nations from participation in growing capitalist trade. While this decade’s long tactic was completed, great expanses of geography were tamed for commerce. Trade grew exponentially between participating industrial nation states, supported by their satellite commodity colonies and post colonial commodity hegemonies.

The 1960s and’70s saw exponential growth of both the size and number of multinational corporations. The largest multinational corporation in 1970 was GM with revenues of 24 billion. Yet it was the opening of China in 1978 that provided the fuel for worldwide domination of the industrial states. By 1990, GM still dominated, now with revenues of 126 billion. By 2000, six of the top 10 world corporations were banks. By 2007, Wal-Mart was the world’s dominant leader with $348 billion in sales.

Certainly, even in 2011, with its ability to obtain through taxation $2.6 trillion dollars in revenue, the United States is still a much greater economic power in terms of consumption than Walmart is in terms of productive value. Yet with deficits over a trillion dollars compared to Walmart’s profits of $13 billion, America’s ability to sustain itself grows ever more fragile.

The United States’ deficits are predicted to remain above a trillion dollars for the remainder of the century as multinational corporations grow in their ability to exploit the geographical limits of its taxing reach. The United States has exercised only limited power to corral any employment benefits from the expansive growth of multinational corporations, leaving its citizens enduring unemployment and underemployment approaching 20 percent. And the United States is not alone. With cross border monetary resources at their disposal, multinational corporations are able to thwart efforts to align their profit motives with taxation and employment motives of industrialized nations throughout the world.

The transition of power from nation states to industrial states is nearing a maturing phase in which the state authority will reach maximum impotence. America’s strategy of dominating hydrocarbonic warfare has already reached the peak of its impact and is waning. In this maturing environment, China may be the one country that has envisioned a strategy that can harness multinational corporate energy within its borders. As a result, it may ride the rising tide of multinational corporate waves to the domination of all other nation states. China’s power to sustain itself during the peak world domination phase of the multinational corporation, however, has yet to be tested.

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American Slavery Forebode the Loss of Our National Sovereignty

America’s historical bias for property rights of individuals and corporations was influenced by centuries of institutional support for slavery from multiple factions. This bias has led to the gutting of our industrial base that now promises to lower the living standard of every American and, more importantly, threatens to destroy our national sovereignty.

Our 370 year struggle against slavery demonstrates the severity of misjudgment that America’s courts and legislatures have been capable of, and the extremes to which government and business leadership has denied universal freedoms in the pursuit of profits. The denial of individual freedoms over the course of American slavery is now being paralleled by the denial of individual economic freedoms resulting from corporate globalization profiteering and forebodes a loss of national sovereignty that could result from the pursuit of profiteering in the coming manipulations of carbon cap and trade.

America’s struggle against slavery pitted the property rights of individuals pursuing financial gain with the universal rights of freedom for all Americans. From the 1500s, when European governments and businesses conspired to enslave Africans as property to be transferred across international boundaries for financial gain until modern times, our courts, legislatures, and businesses have been forced by the American people to slowly progress toward a greater acknowledgement of the equality of mankind.

In a continuation of the history of slavery, seventeenth century EurAmerican governments and businesses were lured by greed to pursue international slave trade. By 1641, in the midst of multinational corporations establishing charter colonies to exploit the Americas, the Massachusetts legislature enacted the first colonial law establishing slaves as property, and Virginia courts followed suit two years later by declaring children of slaves to also be property.

By 1730, England aggressively entered the slave trade selling to thriving slave traders in New York, Massachusetts and South Carolina. Yet the corrupted idea that humans should be property of other humans was not universally accepted by all colonies. As early as 1676, enlightened Quakers prohibited slavery in western New Jersey. With their influence, in 1780, the Commonwealth of Pennsylvania compromised a gradual taking of “private property” from slave owners with their understanding that all men of differing complexions have the mercy of universal civilization under the hand of the almighty, by passing the Gradual Emancipation Act which gave freedom to all Pennsylvania slaves over a seven year period. Knowing that their ability to cash in from the sale of slaves was about to end, slave owners starting crossing the border to sell their “property” in slave states. In 1788, the Pennsylvania Quakers once again stood forward in history to stop cross border selling of “slave property” by forbidding removal of blacks from the state.

The 1791 invention of the cotton gin made slavery a much greater financial temptation and aligned state governments and businesses according to slavery’s financial benefits, with states taking sides up until the Supreme Court declared in the 1857 Dred Scott decision that even free blacks could never be citizens of the United States.

Dred Scott led to the American Civil War, where 600,000 Americans gave their lives to resolve the issue as to whether America would ever consider people property again. When the war ended, Congress passed the Thirteenth Amendment to the Constitution abolishing slavery in 1865 and the landmark Fourteenth Amendment that defined American citizenship, including former slaves and free blacks as citizens in 1868.

After the milestone of the civil war, African Americans would then endure another 100 years of deep-rooted bigotry until additional legal and legislative milestones of the 1950’s and 1960s prepared America for forty years of healing leading to the election of President Barack Obama in 2008. America demonstrated through the election of President Obama that over a period of centuries, with the participation of millions of citizens in protests and debates, organized societies and civil disobedience, sit-ins and marches, black churches and underground railroads, publications and uprisings, political activism and yes, civil war, we could affect a positive change from our courts, legislatures, and businesses toward the concept of universal individual freedoms over the rights of individuals and corporations to claim property rights for profiteering.

As the milestones for individual freedoms were accomplished in the 1960s, a paralleling long struggle for national sovereignty began. The eventual need for this movement was set in motion in 1861 by the invention of oil refining which provided the basis for the industrial revolution. Through hydrocarbon driven machinery, EurAmerica replaced the enslavement of mankind with the subjugation of energy. A gallon of gasoline that could do the work of 500 men became the new slave of the industrialized world. Certainly, western countries continued to subjugate millions in emerging countries, first through colonization and then after WWII, when Europe was forced to decolonize, through financial hegemony of IMF and World Bank loans, subjugating emerging countries to low wages and sub-value payments for commodity exports. However, hydrocarbons enslaved much more motive force than human slavery ever could.

It was in this environment, accelerating from 1978 until the world’s Great Recession of 2008, that wealthy individual and American multinational corporations claimed property rights of trillions of dollars of American financial capital and many trillions of dollars more of intellectual capital, that has yet to even be realized, and transferred them across international borders in the pursuit of personal and institutional gain. In the process, millions of American jobs were lost and American industry was gutted. Over 40,000 factories have been transferred to China in the past decade alone.

However, unlike the millions of Americans that organized in so many ways to fight for the abolishment of slavery, during the last thirty years of transferring American property across international borders for personal gain, America has stood by while our national sovereignty has been weakened. For the mere exchange of “glass trinkets”, our multinational corporations have transferred to other nations countless innovations and trade secrets that have in the process given away a decade’s long, perhaps centuries long, stream of jobs and an exponential advancement of innovation to other nations. While the proverbial horses by now have trotted far out into the foreign fields, it is still not too late to close the barn door and to begin rebuilding an American future of protected ingenuity.

The institution of slavery destroyed the lives and individual freedoms of millions of African Americans and its vestiges continue to impact suffering in the African American community. In the three centuries preceding the 1978 Great Gold Rush to China, it also forebode the economic suffering that would eventually harm all of America, affecting the African American community worst.

Slavery shaped America’s concepts of property rights, what is the property of the individual versus what is to be protected by the state. In that struggle, the ideas born by persons employed in corporations became the property of corporations to be transferred freely to other nations, with the exception of ideas that clearly pertained to national security. However, that view of property rights lobbied by America’s businesses, has allowed the historic gutting of America that has collectively created a national security risk now threatening the economic sovereignty if America.

Even as American businesses participated in the simultaneous building of China’s future industrial infrastructure while gutting America’s future, China pursued the development of hegemonic hydrocarbon contracts for her needed growth. She is developing military strength to prepare for harboring of petrol shipping lanes and implementing strategies to wrest control of diminishing oil reserves from western empires. It now appears that Americans may live through violent shifts of world economies as the East gathers control of the West’s petrol-power.

In the last three great wars in which America has participated, the deciding factor was not the size of America’s military at the start of war, but rather the capacity of America’s overwhelming industrial base that quickly transformed to support the endurance of our freshly formed military. The United States now has the greatest military footprint ever assembled but Japan showed the world that our existing strength was vulnerable to first strikes. Our ability to turn our nation’s industrial strength toward military response was our greatest threat to would be rivals. Thirty years and tens of thousands of factory transfers later, our concept of property rights has allowed America’s responsive industrial strength to wither, jeopardizing our entire nation’s freedom.

Through the morass of 300 years of biased property rights legal precedence, America asked our courts and Congress to ensure that the historic temptation of businesses to transfer massive values of property to China and other developing nations would not interfere with the rights of all Americans to the fruits of American ingenuity, innovation and prosperity, paid for with the blood of our forefathers in the wars and struggles for human freedom and universal rights. We came up short.

America has but a limited view of sovereign protections regarding property rights. We are now debating the premise of saving the planet by trading to other nations our rights to consume hydrocarbons through a carbon cap and trade program. Make no mistake, oil is the modern slave of all mankind and will be consumed until it is fully depleted by one country or another without regard for our planet. Cap and trade will allow those who have polluted in the past to claim property rights to future pollution and transfer those property rights to other nations. In so doing, cap and trade will take remaining economic sovereignty away from the people of the United States and give it to a few businesses to trade our ability to enslave remaining decades of hydrocarbons to other nations in exchange for a few more glass trinkets.

As America enters into our coming economic crisis, remember we can strengthen our barn and rebuild. We can protect against further gutting of business through comprehensive property rights reform. We certainly can protect America’s sovereignty by protecting our abilities to responsibly consume hydrocarbons. The struggle against slavery shows that what is entailed in reversing America’s plight is epic. However, our coming economic struggle will be cause for such epic proportions.

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Filed under American Governance, American Innovation, American Politics, Multinational Corporations