Misplaced Priorities?

Once or twice per month I visit San Francisco. The ride, depending on traffic, takes anywhere from 45 minutes to 1 hour and 15 minutes. The distance from my home is 35 miles.

San Francisco is one of the most beautiful cities in the entire world. San Francisco joins Rio de Janeiro, Hong Kong, Sidney, and Paris as my favorite destinations.

The architecture, natural beauty, and ambiance make these cities special. Visitors never get enough; they are always eager to return. This affinity often helps us overlook any undesirable characteristics.

The Negatives

Beside the ever-increasing traffic, visitors cannot ignore the many tent cities under bridges, in alleyways or in nearby parks. Most people occupying these tents are those who can no longer afford to live in the City. A few are folks struggling with a variety of additions and mental health issues. A recent survey reports that there has been an increase in homelessness on the West Coast by 1% as a result of surge in housing costs.

A two bedroom apartment in San Francisco costs $ 3,500 and up per month. If you earn $ 20 per hour, your rent will eat up your entire paycheck, and when you factor in deductions, it will not be enough.  It is fair to say that to be able to live in San Francisco you will have to earn $ 100,000 or more per year.  Rent would eat up about 42% of the paycheck leaving about $ 58,000 to cover taxes, utilities, food, clothing, transportation, and health insurance. It is a well-known fact that the cost of living in the City is sky high.

Section 8 and BMR housing are in short supply. The little that becomes available is gobbled up in matter of hours.

The City has become the residence of choice for wealthy people and highly paid young professionals. The middle class has gradually moved to the suburbs, save those folks lucky to have purchased their residence prior to the real estate price boom, or fortunate to occupy residences benefitted from rent control regulations.

Those who cater to the upper crust of earners either spend many hours commuting to and from the suburbs or choose to sleep in their cars or in tents. Lack of toilets force people to urinate or defecate in narrow out-of-sight places.  Lack of access to showers forces some folks to go without for weeks or months. Cold winter nights expose many to freezing and other hardships. Several with addictions or mental issues panhandle to supplement any handouts they receive from welfare agencies.

The homeless population has been estimated at 8,000 to 18,000. Included but not always counted are minor children. A recent survey of the greater Bay Area indicates that 1 out of 5 children go to sleep every night hungry. This is a disgrace of gargantuan proportions. The City has launched a program to track homelessness of young adults.

San Francisco is a progressive city. It has been that way for many decades. Residents are generous and give freely to help the unfortunate. It has designated itself as a sanctuary city, open to anyone seeking asylum.

Scratching the bonhomie surface, however, reveals shocking anomalies. Below the beautiful exterior, many people live a very precarious life. Hidden from view, many people hurt.

If you listen to elected officials, you get the idea that all is being done to remedy the situation within budget limitations. However, I find this claim a laughable excuse when I look at four espoused priorities that seem to take precedence:

·      Climate change – an important issue for sure, but not one I would put ahead of helping poor people who are sleeping under bridges, especially during cold months.

·      Legal Defense Fund for Illegal Aliens – an issue at odds with our federal immigration laws. Use of limited resources that could be used to build more public toilets and showers.

·      Lawsuits of the Federal Government – political stunts to misdirect people’s attention from ordinary living problems. Politicians are using the legal system to win over what they might have lost at the ballot box.

·      Tuition for Illegal Aliens – spending limited resources to fund tuition of illegal aliens is laudable but it should not be at the expense of poor American citizens.

These initiatives are important to people and worthwhile preserving. My question is a simple one. Are they more important than the needs of the homeless? Of hungry children? I would suggest a loud No.

Life in the Fast Lane

San Francisco is not alone. The same issues can be found in many large cities … New York, Chicago, Los Angeles, Baltimore, Philadelphia, Washington, D.C., and other major cities.  Affordable housing is a scarce commodity.

Most large cities are run primarily by progressive administrations. Every four years politicians promise the sun and the moon, but deliver a sliver of what they promise. With more promises, they get reelected over again. If they fail to deliver, politicians will use worn-out excuses to blame Washington and/or heartless conservatives.

As you scan the landscape, you can find that some cities do a better job than others, and that we have much to learn from one another. The problem is the NIH (not invented here) syndrome that affects most of us. You know … we are different, we tried that and did not work, we are not as wealthy, and so on.

America is the richest nation in the world. We have spent trillions of dollars to eradicate poverty since the 1960’s. Yet we have as many, if not more, poor people than we did way back then. What happened to all that money? As it cascaded down, many seem to have taken their cut … states, cities, agencies, non-profits, and unscrupulous politicians. Some middlemen and women got very rich with the people’s money. Graft, corruption, sloppy management ate up most of the money. So much for trickle-down well-intentioned government programs!

Doing the same thing over and over expecting a different result is folly, the distinguished Albert Einstein warned us. Yet that is exactly what we continue to do with the people’s money.

Lessons from Puerto Rico

Puerto Rico was recently devastated by a hurricane. Roads were washed away. Power lines destroyed. Houses were blown away by fierce winds. Many trees were uprooted. The island is far from the mainland. Logistics became very complicated.

FEMA was not able to feed 3 million Puerto Ricans marooned in their island after the devastating hurricane.  Although “emergency” is in the name, many policies within FEMA are not adequate for problems of this magnitude.

Federal procurement policies required multiple bids. Multiple bids take several days. People were hungry, and they needed to be fed NOW. Bureaucratic red tape is not user-friendly, by definition.

Here comes a Spaniard from Washington, D.C., a well-known chef to the rescue. Within hours he started to feed people. In a few days, he was producing 3 million meals per day. The chef’s name is Jose’ Andres. He organized ChefsForPuertoRico. Jose’ taught us that if and when we unleash human ingenuity and freedom, there is nothing we cannot do.

Unencumbered by red tape, he single-handedly marshaled the energy of many to help solve the problem. It was done on a pro-bono basis, on humanitarian grounds. We all owe Jose’ a word of thanks! He has shown the way to respond to a crisis.

Lessons from Silicon Valley

The high tech industry is setting the pace to combat the affordable housing problem. Google is building about 10,000 housing units next to its Mountain View campus. It is also building a “village” in San Jose’, close to the transportation hub. Twenty-nine thousand housing units will be built to house staff additions. Google will employ 25,000 more employees.

Facebook is also leading the charge. The company is building about 10,000 units adjacent to its Menlo Park campus. It has also made generous contributions to local initiatives addressing the housing shortage.

Stanford University is doing its part. They are building additional affordable housing for faculty and students. The university has led the charge in housing for decades, realizing that without affordable housing its success in attracting first class faculty and middle class students would have suffered.

Silicon Valley is known for its creativity. You can see it in action the way larger employers are mitigating the traffic congestion, for example. Highway 101 is crisscrossed several times per day by large, luxurious busses shuttling employees back and forth from the City. Employees rather than being stuck in crawling traffic can sit back comfortably and start their work routine. Companies benefit from greater productivity. A win-win exchange!

Time to Outsource

There are other Jose’ Andres in Silicon Valley. Let’s give them the latitude to harness all available resources to solve the homeless problem in our cities sooner rather than later.  Surely they can do much better than our inept politicians and bureaucrats.

John Lennon’s song rings true … I might be a dreamer, but I am not the only one.

What do you think?

Much Needed Change ...

It is salutary for organizations to undergo periodic renewal and reset. Pruning away obsolete concepts, shedding contradictory values, and eliminating improper activities help the organizational tree grow healthier and stronger. Organizations that resist change are doomed to live a mediocre existence, and eventually join other relics in the dustpan of time.

The Vietnam War unleashed pent-up demand for reforming our social, economic, and political system. Since then we have made inroads in our search for a more equitable society and a more transparent political modus operandi. But change has been too slow and the job is far from complete. Much remains to be done. And for many, progress, in addition to being too slow, has been uneven.

Organizations, similarly to humans, evolve. Attitudes change and laws are amended to reflect contemporary realities. What worked before may not be appropriate today. Folks have no stomach for repression, unfairness, cruelty, and dogma. They clamor for real change, and they demand it immediately. Reforming the entire system, however, can be a daunting effort.

For the past 50 years, the country has slowly shifted away from the founding vision of “to each according to his/her capabilities” toward a more egalitarian vision of “to each according to his/her needs.” Some argue that nirvana is not in either, but it might be in melding the two. Rather than attacking each other’s vision, we might be better served to examine the benefits of each and construct a new paradigm that benefits all.

The Founding Model

Based on the free enterprise model, America was built on the strength of the rugged individualist. This terrain was perfect for the capitalist model to flourish. Along with its many benefits came major abuses.  Profits became the end rather than the means to success. People soon became suspicious of the capitalists’ motives and offended by what they saw as excesses.

The emphasis prior to 1960 was on integration. Newcomers were encouraged to assimilate, to learn English, and to be self-reliant. They were promised the American Dream. You work hard and you have a chance to advance. There would be minimal economic and social barriers to advancement. It was all based on merit.  Sure, pockets of little Italy, little Poland, little whatever existed, but patriotism was extolled. Racial discrimination however was swept under the rug.

Experience in other countries has shown that it does not have to be that way. In the face of the total collapse of the Marxist/Leninist model, folks realized that there might be a middle ground where the two opposing visions could merge and give rise to a more equitable and compassionate model. Scandinavia was the laboratory where these two competing models have come together to provide a more balanced approach. Is this reconciliation perfect? Possibly not, but it has moved the yardstick forward.

Emphasis has lately shifted to differentiation. Fissures in the meritocratic model exposed racism, xenophobia, sexism, homophobia and religious intolerance. Whites have been accused of privilege over other races. Women have bumped into artificial ceilings. Unregulated immigration has given rise to a large pool of residents with nowhere to go for refuge except their ethnic barrios. While many espoused the benefits of diversity, in practice, diversity might have hurt those who have not learned to speak English or assimilated. Diversity seems to have morphed into separation.

Changing the System

Changing a large system before we fully understand it is a folly. Yet many so-called proponents have suggested just that; moved by impatience perhaps or urged by political opportunism. Large systems change when they are ready to change.

Examples abound that illustrate this point. The civil rights movement continues its battle 50 years after Doctor King’s death. Its job is not yet complete. Women have been clamoring for equal pay for equal work for decades, yet the issue is not fully resolved. Harassment based on gender is not new. As the gap between rich and poor grows so has anger toward what people perceive an unjust and unfair system.

Change management theory teaches us that there are three main strategies for change; each has its pluses and minuses. Some people advocate the incremental, go-slow method. Contemporarily people clamor for transformational change.  The problem for many is that both methods are way too slow. So what’s left might be a third way … revolutionary, albeit peaceful, change. The downside with the latter is that revolutionary change is hard to control.

Oscillation versus Advancement

In my view (I could be in the small minority), our political system, as it has existed for much of our history, is responsible for slowing the change process.  Every eight years or so the other party takes control. The incoming party shaves off any gains made by the previous party that do not conform to its ideology. Advancement of the agenda is immediately followed by reversal. This periodic oscillation reduces the forward movement made by the prior administration.

We have witnessed this phenomenon this year. The incoming administration has erased or diminished any advancement by the prior administration in climate change, education, foreign policy, regulations, healthcare, immigration, and so on.   The only period in our history where substantial change took roots was during the 1930-1940’s. The party in power was able to maintain control of Congress and the White House for twenty years, thus enabling the nation to digest and institutionalize significant changes.

Lessons from China

Revolutions are chaotic and messy. They unnerve people, and often lead to instability and unintended consequences. Once they reach the tipping point, revolutions are hard to stop. They breed another form of intolerance … against those who think or behave differently. Although peaceful in name, impatience often leads to autocratic and violent acts.

The Cultural Revolution in China divided families, elders from the younger, and led to many despicable acts. Old men and women were sent to re-education camps. Professionals were demoted and relegated to menial jobs. Perceived bourgeoisie was punished with exile or jail. The dogma of the little red book became the ruler of the proper way to interpret events or make decisions. Another form of PC? Symbols were erased. So-called privileges negated.

Resistance as a form of opposition can be a zero-sum game. Relativism takes over … the ends justify the means. Experience has shown that revolutions breed counter-revolutions, and the winners over time might become the losers. What goes around comes around …?

Fast Forward

In the past few weeks we have witnessed the dam bursting, triggering an avalanche of accusations, mea culpas, and sordid details. Luminaries, movie moguls, politicians, company executives, union executives, actors, famous sports figures, TV personalities, and religious persons have been accused of sexual harassment and assault. Members of the Congress have been on the receiving end of 260 accusations, silenced by more than $ 17 million dollars of the people’s money.

In short time, hypocrisy by the political and economic elite has been exposed and pilloried. Some folks suggest that it is only the tip of the iceberg; that major revelations will come out regarding similar abuses in our campuses and other institutions.  Others suggest that the opening of floodgates will usher much needed transparency.

For many women, on the receiving end, it is a time for catharsis and cleansing. Purging the system of unwanted sexual advances is long overdue, many say.  Women have suffered in silence for violation of their person and dignity.

Suspected perpetrators have been shamed and ridiculed.  A few have taken responsibility for their boorish behavior while others retreat to the familiar Sargeant Schultz defense of “I know nothing.” Looking for redemption for their inexcusable behavior, a few elites have sought the refuge of four-star “treatment” or “rehab” centers or taken a long sabbatical searching for redemption.

Dante, the author of the Divine Comedy, had a special place in hell for hypocrites.  They were condemned to walk around carrying heavy capes made out of solid (heavy) gold. The cape was a metaphor for cover-up and phoniness. This metaphor is most appropriate today.

Much hypocrisy and “I am holier than thou” pronouncements by our politicians, religious leaders, and other officials have shielded offenders from prosecution, shaming, and ostracism for years. It is their silence and cover-up that must be rejected. They were complicit in hiding unspeakable acts of abusive and perhaps criminal behavior. 

We are all guilty of this in the end.  Finger pointing is a diversionary tactic. We cannot escape to the sidelines … time to man-up? We must admit that we knew that it was happening and that we chose to look sideways. You can say that Pontius Pilate behavior in most of us is alive and well.

It is time for immediate change … we have run out of excuses.

Where Next?

We need to expose all our blemishes and defects if we are to construct a more perfect union. Reformation brings many benefits, addresses many inequities, and heals our wounds. But it is a painful process.

There are many overarching goals that can bring us together as a nation. We need to shift our focus to things that matter, where common ground and common purpose can meet.

We need better paying jobs. We need more equitable taxation. We need a better health system. We need to improve our infrastructure. We need to rationalize our immigration system. We need better ways to protect our democracy and way of life.

We need, we need, we need…

There is much that can bring us together! Instead, divisive parochial interests entrap us. We use identity slices of race, age, religion, national origin, gender, or sexual preference to expose differences.

Let’s remember that we are all Americans, and travel on the same boat.

Why People Hate The Rich ... My View

A little background

I was brought up in a middle class family of modest means in a small hilltop town in Sicily. My father had a sixth grade education. His dad emigrated to the U.S. when he was 6 years old. He never saw him again. At age 13 he started his first business to support his mom and younger brother. He just worked, dreamed, and tried numerous ways to improve his station. An avid reader, he was current on many subjects and he was fascinated by the intricacies of real estate law.

My mother came from a better economic station. Her dad passed away three months before her marriage to my dad. Her father put aside the local tradition of not sending female children to school by insisting that she and her older sisters learn how to write and read. As a result, a novelty for their time, my mother and her older sisters were permitted to go to school through the third grade. She was a worker bee. I don’t remember ever hearing her complain or resent our humble circumstances. She was deeply in love with my dad, and my dad with her.

When they both passed away, they had been happily married for 66 years. A novelty, I might add, by today’s standards.

Growing up, I never heard my dad complain about his dad who pretty much abandoned his family, although he would occasionally send them money. He did occasionally lament that he did not have the opportunity to continue his formal studies. He wanted to become a real estate lawyer, a profession he highly admired.

Thanks to his photographic memory, he managed to learn every detail of real estate law, and he spent his final active days working as an assistant to a real estate lawyer (notaio). Notaios in Italy must be degreed lawyers, and go through a three-year specialization course. Notaios are the highest paid profession in Italy earning on average 5 million dollars per year. The number of notaios in Italy is a closed number, therefore positions are often passed from one generation to another, and one has to wait for a notaio to die to aspire to replace him/her.

This lawyer for whom my dad worked told me once that my dad knew more about the law that he did, and that he soon learned to seek his advice during complex real estate deals. It was his way to let me know how smart and hard working my dad was.

Growing up in Sicily right after the war was hard. The country had lost the war and its infrastructure was devastated. The currency was worthless. People had to resort to barter. Most goods were hard to find, and very expensive to purchase. My dad was able to navigate through this period by finding local needs and filling them. He imported and exported goods, he co-founded a power company, and he co-founded a mill to provide flour to the local town.

Dad was strict and demanding. He would not accept excuses or tolerate mediocrity. He rejoiced in others’ success bringing them up to my younger brothers and me as examples of what hard work or an advanced education can do for you. He admired anyone who was able to rise above everybody else through sheer determination and smarts. My two brothers and I have pretty much inherited the same philosophy.

How do people become rich?

The easiest way to become wealthy is to inherit it.  You don’t have to do anything else, just be in the family's line of succession. In the U.S. we have many famous extra-rich people who got their wealth this way: Kennedy, Rockefeller, Mellon, Walton, Koch, Mars, Lauder, Du Pont, Goldman, Hunt, and Gallo to name a few. If you are not wealthy by inheritance, you can become rich by marrying someone who is already rich. These super-wealthy folks often avoid inheritance taxes by setting up perpetual trusts benefitting their progeny thus escaping inheritance taxation.

A more difficult way to get rich is to make it. You start a business, the business thrives, and you get rich. The majority of rich people in America become rich this way. Small businesses and family farms, by and large, comprise this group. You don’t need to be born into family wealth or have advanced education to join this group … just the willingness to take risks, access to start up capital, and a positive market response.

An harder way to get rich is for folks to become a star. They earn it.  They include corporate executives, litigators, medical doctors, movie and television stars, athletes, and Wall Street traders. These individuals earn millions every year. Retired U.S. presidents and first ladies occupy this space as well. It has been said that this group is  the crème de la crème; they are the statistical outliers. As wage earners they are affected by the income tax top rate. Other rich folks pay a much lower rate because dividends and interest are taxed at a much lower rate.

Another way to get rich is to steal. This wealth is ill-gotten, meaning as a result of nefarious and illegal means. It is a small percentage but it shows that greed and malfeasance are at play.  MSNBC devotes several hours per week featuring greedy characters that run amok of the law and wind up in jail after ripping off naïve investors. I submit that this is the smallest group but one that evokes strong reaction by the public. One of the bad habits of this group is that they often engage in lavish life styles that bring unwanted notoriety to them.

The last group falls in the category luck. It is not a big group, but it is larger than the previous group. These folks happen to be at the right place at the right time.  They joined a company whose shares took off on Wall Street. They bought shares in an emerging company in its formative years and suddenly gained popularity and growth. They bougth real estate and the market prices boomed. It was not their genius or their greed that brought financial success, just pure luck.

O.K. why the hate?

Some folks resent that so few have so much. It is unfair! After all we are all created equal as humans. They do not seem to differentiate between different types. They assume that all the rich have gotten rich as a result of unscrupulous behavior at the expense of the poor. They discount or ignore that some people might have had a better idea or that the person worked harder and sacrificed much, or that he was more competent. No! It was all ill-gotten and should be taken away.

Many are motivated by envy. They aspire to become wealthy but wealth has eluded them, therefore they resent that someone else, perhaps not as smart, or as well educated managed to do so. Some intellectual elite fall in this group. They feel entitled to wealth based on their superior education, and have a hard time accepting that Joe Bloe with a high school diploma or less should rise above their financial station. Minorities might bring up white privilege, and forget the fact that skin color, gender, sexual preference, and religion do not count that much. In the five categories discussed earlier, you will find folks from every walk of life. Money has one color, and it is green.

A small number hates the rich out of sheer ignorance. They don’t know the facts but eagerly accept the notion that if you got rich you did so at someone else’s expense. This notion has history behind. It is a fact that during the industrial revolution and for part of the post industrial revolution, it was common for ‘barons” to exploit their workers. That is how some fortunes were built during the 1800’s and 1900’s.  Labor laws enacted since have outlawed many such practices and provided remedies to workers, including collective bargaining.

Folks resent the lavish lifestyle that the rich and famous engage in. The mass media bombards the public with anecdotes of excess and sheer extravaganza. Much damage was done to Romney during the 2012 Presidential Elections when news leaked out that he was building an elevator for his cars in his La Jolla estate. The public finds excesses gross and unworthy of admiration given that there are people around the world who are poor and disadvantaged. Some folks will often quote the Scriptures to confirm that the rich have few, if any, redeeming qualities.

When you combine the five categories, you have a strong cocktail of hate hurled at the rich, typically the top 5% of the population. It does to take long for the posse to form and for mob rule to take over. Sock it to the rich ... Increase their tax rate, impose a heavy death tax, it is only fair that they pay more, and so on. The bandwagon gets many converts ... wealth redistribution after all benefits the other 95%. Never mind that the top 20% pay 80% of the income tax collected by the IRS. 

Summary

Money, it has been said, is the source of all evil. I disagree! Most money is put to good use. America has many foundations started by super-wealthy folks to provide resources for many projects helping those in need domestically and abroad. Many super-rich (top 1/10 of 1%) are donating 75 to 90 percent of their wealth to charities. Investments create jobs, and employ people. 

An interesting factoid of yesteryear: the top 10 rich U.S. Senators got rich by inheritance while the top 10 rich Representatives made theirs. Those who inherited their wealth advocate laws that shift payments from one group to another. Those who made their wealth advocate the opposite intent on sheltering their wealth from the greedy hands of government.

A miniscule number of the rich have gotten there by devious or illegal means. Not every rich person suffers from greed, just a few. 

Rejoice in others’ good fortune. Let it be a source of inspiration if you are so motivated to want to join their ranks.

I am not aware of anyone aspiring to be poor. I know many who aspire to become rich the old fashion way: earn it or get lucky.