31 March 2009


I’ve just returned from several days out west, based in Las Vegas. It has been 35 to 40 years since I last visited, and needless to say things have changed radically. A few of the old establishments are still around, although updated, and the amount of new construction is just mindboggling. One thing that hasn’t changed is casinos filled with smoke and smokers. In the past this seemed normal as smoking was pervasive, but now it is something of an oddity, and truly awful for a non-, or ex-smoker to endure. Things have changed on the slots as well; they now use tickets instead of coins and currency, which kind of takes away the jingling sound that used to greet the occasional winner. I am one of the few visitors to Las Vegas who spent nothing gambling, having learned a hard lesson about that many years ago, and finding nothing appealing about the present setup.

There is now a monorail paralleling the strip but it is poorly conceived, running along the back end of hotels. To get to it you have to walk through casinos, then up and down stairs or broken escalators, so that you might as well have hiked to your next destination. The stops are all casinos from the north end of the strip to the south, and in the course of the ride you must endure some thoroughly inane commentary along the way. Then wherever you are, you have to walk through a casino to get back to the strip.

The biggest change from my standpoint is the way shows are presented. In the old days it was like a nightclub where you could sit with a drink and watch the show. Not any more. The shows are ridiculously overpriced and presented in theaters. In one instance where I had the misfortune to see the Bette Midler show, it was held in a theater with over 4,000 seats. It was sheer torture to sit through, between her occasionally singing loudly but not well, while otherwise engaging in a foul rant and badmouthing people like Rush Limbaugh and Sarah Palin, which is kind of like giving the finger to more or less half the country. To add insult to injury they insisted on confiscating all cameras, while pointlessly ignoring cell phones, which can also take pictures, and were integrated into a kind of audience participation segment, with a sissy wave moving the lighted phones back and forth. In this and all other shows the loudspeakers blast at an intolerable level, and projection screens are seriously overused in what is supposed to be a live show.

Then there are the people. As far as I could tell I was the only one wearing a jacket, and the audience was dressed in a variety of ways, like the pedestrians on the strip and in the casinos, ranging from awful to horrible. Women were dressed in flip-flops and men also dressed as though they were at a Caribbean resort, when the temperature was actually quite chilly, often walking along the street with a drink in hand and a cigarette dangling from their lips. There is something totally incongruous when you have the pretense of an upscale, elegantly appointed hotel, like the Venetian or Bellagio, and a parade of slobs constantly passing through. And that is just the white trash. There was also a large number of minorities everywhere, which helps explain how this western state could have flipped Democratic. To paraphrase the queen, for the first time in my life I’m not proud of my country. If you don’t gamble, Las Vegas is no place for anyone with any intelligence or sophistication. I hate to say it but things were a lot better when the mob was in charge.

One night we decided to check out Fremont Street in downtown Las Vegas, which is famous for its light displays and overhead projection screens. However, the moment we got there all the lights were turned off for some idiotic “earth hour,” so we had to wait around in the darkness surrounded by a milling crowd of lowlifes. People in that part of the country would do well to worry more about water supply than CO2. When we visited Hoover Dam the water level was down more than 40 feet, and this is the source much of the southwest depends on for water. That also includes southern California, agriculture in particular, where about half of our produce comes from nationally. While spending all this stimulus money on ephemeral projects, it would be worthwhile to find a way to get water from the north where the Red River is overflowing, to the south where it is needed.

After days of visiting shows, hotels, and nearby attractions we headed on a couple of long range trips to national parks in Utah, including Zion, and Bryce where we stayed overnight, and where it was actually snowing. Then we headed in the opposite direction in both temperature and distance to Death Valley in California. For that sort of thing Las Vegas is an ideal jumping off point for side trips. But personally I prefer natural monuments to man’s monumental excess.

21 March 2009


The outrage over the AIG executive bonuses is really over the top, amounting to mere millions while the government is spending trillions of dollars haphazardly. It is not that these bonuses are defensible, but rather that far more in questionable bonuses have been paid at other firms, and the percolating opposition may spill over to all bonuses generally. This would be disastrous, insofar as employees from secretaries to CEOs depend on receiving them as part of their compensation. In financial firms bonuses are a given, and are designed to reward and encourage good performance. Certainly some companies have paid out excessive sums at the top, but that is a problem for the owners of the company, i.e.the stockholders, whose money is being spent in this fashion, not the government. This is also another ominous indication of what happens when government takes ownership of private institutions and begins to micromanage them. However posturing politicians in the congress and administration are in no position to pass judgement in this or any other similar situation because they share a complementary feature that pervades all forms of organization.

The primary truth of every organization is that the people in charge run it in their own interests. This is as true for corporations as it is for nonprofits, "community" groups, political parties, churches, schools, universities, socialist regimes, unions, government agencies, associations, and every other form of human organization. Once the cornerstone of bureaucracy is laid, structural differentiation begins to take place, as people assume functionally specific roles. This means that someone must be in charge and manage different layers and the overall direction of things. In the process human nature kicks in and those in charge make certain that the activities of the organization complement their own interests. This does not mean there is an inherent conflict here, and the consequences can be beneficial. Nevertheless there is a certainty that those in charge will be sure that their own needs, comfort, and prerogatives are met and born by the organization to the extent possible. Supervision, no matter what the structure, is at best tenuous, as no one outside can manage the day to day operations of a hierarchy. The perquisites of office are widely accepted as legitimate for the roles in question and from this a sense of entitlement often follows, and as a result personal interest becomes fused with organizational purpose. Thus, organization inevitably results in oligarchy as those in charge enjoy not only the greatest benefits, but have the ability to strongly influence, if not control, their distribution. The power to make such decisions and implement them comes with oligarchy. Consider virtually any organization and you will find the trappings of office accentuated at the top.

Under normal circumstances no one questions the legitimacy of these arrangements as long as things function more or less as expected. It is when systems break down that a crisis ensues, and that is essentially what we are facing now in the global financial industry. Prior to this time an executive could walk off with tens, if not hundreds of millions of dollars with the expectation of little more than envy. Thus for example, a Michael EIsner could earn more money in one year than Walt Disney earned in his entire life while founding and establishing his corporation. Now that the disconnect between performance and reward is evident, more and more anger has been directed at financial organizations and other corporations. The reaction to AIG is simply the explosion of pent-up frustration. However, keep in mind that no matter what succeeds AIG, sooner or later the inevitability of oligarchy will establish itself.

17 March 2009


This will probably annoy ideological purists but a couple of steps Obama has taken on some relatively minor issues are correct, in my view. The first was rescinding the nutty Bush policy of refusing to fund birth control around the world. In poor countries population growth is a serious problem insofar as there is no economy to sustain it. This can only lead to continued poverty and a future in which our own children are overwhelmed. Unfortunately birth control is so effective in the developed world that it is leading to population declines. Birth control is essential for poor countries to make progress. The second smart step is for the federal government to stop harassing medical marijuana in California. This never made any sense and is a waste of resources. Finally, lifting the Bush ban on stem cell research funding seems sensible to me. It is a stretch to equate an embryo, which is a potential life, to an actual human being. Furthermore the disposition of embryos properly remains with the parents, not the government. Anything else is an unwarranted interference in family life.

14 March 2009


A myth has grown based on the last election that the Left was somehow way ahead on the Internet, new media, etc. This is simply not true. In fact the Right was there first, long before the Left had an inkling about electronic technology. Conservative sites were established early on. In fact in 1996 Libertarian candidate Harry Brown actually won the Presidential poll of Internet users at the time.

What did happen was the Democrats were better organized, had far greater enthusiasm, and got more than two-thirds of the youth vote, for whom casting the ballot was almost a moral imperative after being brainwashed all their lives about “racism.” As a result it appeared as though new technology was at the core when in fact it was simply a case of those most likely to use it, i.e. younger voters, leaning one way. This was compounded by the entire celebrity-entertainment-popular culture, whom younger people are dumb enough to follow, leaning one way. In this light Obama’s Internet announcements were more gimmick than substance and didn’t move any votes.

Nevertheless the idea is out that the Right has to “catch up” to where it always has been. There is certainly no paucity of conservative sites, blogs, Twitter users, and organizations. In fact there are arguably too many chiefs and not enough Indians as new organizations are constantly popping up to “renew” “restore,” or otherwise transform the Republicans. However, the problem is far deeper. The brand has been decimated and may be beyond saving. Perhaps a new conservative party is the answer. After all there has been no real decline in the number of people who identify themselves as “conservative,” who are still more than double the number of self-identified “liberals,” and exceed even independents. “Republican” identity, on the other hand, has collapsed, with most of the loss going to independents. There is a real question as to whether the party label can be salvaged, barring catastrophic overreach by Obama and the Democrats, which is quite possible, but even then a lot of people returning to the Republican fold will only do so while holding their noses.

12 March 2009


New York City has got to be the only place that can get away with claiming your property value has increased, you can’t appeal and therefore your taxes must rise even while real estate is actually going down the toilet. Fat chance of getting a decrease when actual values register.

Meanwhile years ago at some point I put a wrought-iron fence around a tree in front of my house. Now the city is actually cutting cement, servicing tree wells, and providing free iron fences along the block. With such screwed up priorities no wonder the city is in the hole.

09 March 2009


The best CEO in America is Rex Tillerson of Exxon-Mobil. He is a straight shooter who has stuck to his guns on what his company should be doing, notwithstanding pressure to take on projects that have nothing to do with the petroleum industry. The company’s objective, stated simply and forthrightly, is to increase shareholder value. This they have done consistently year in and year out. Tillerson did not make the mistake others did in jumping after alternative energy that is not economically viable. He was not swayed by $140 a barrel oil, realizing that it would be a temporary phenomenon, and has kept the company steadily growing based upon conservative assumptions. As a result earnings continue to grow and the stock is holding up.

The worst CEO is Jeffery Imelt of General Electric. This is a company whose stock has collapsed ten times over to single digits under his leadership. He has allowed MSNBC to become a left-wing propaganda institution, while consistently last in the ratings. He made an idiotic attempt to sell off GE’s lighting and appliance divisions; fortunately there were no buyers. After all what is General Electric without them? Actually it is a poor excuse for an industrial concern; half of its profit comes from its financial operations, which have dragged the stock into a hole, Imelt has also been the first one in line for government handouts, particularly for “green” initiatives. It takes a considerable amount of ineptitude to drive a great, iconic corporation to its current miserable state, but Imelt has managed to do that during his tenure as CEO.

06 March 2009


Yesterday the “International Criminal Court” issued an arrest warrant for Omar al-Bashir, the President of Sudan on charges of war crimes in the Darfur region. Mr. Bashir may richly deserve condemnation for his evil deeds in office, however he is a head of state and as such should not be subject to a supranational entity in the absence of any consensus. Abuse of power is not the question, but rather whether this should be a political decision of the powers that be and that actually have the power to enforce the decree, (i.e. the Security council),or a legal statement by an unelected judiciary accountable to no one.

The United States, for good reason is not a party to the International Criminal Court. Ominously Barack Obama is considering joining. This would result in American officials and military personnel being charged with “crimes against humanity” by radical left-wing groups, possibly with the support of sympathetic governments. As a result American citizens could be seized in foreign countries and be tried on bogus charges by a tribunal over which we have no control. The proper response to such an act of war should be to send in the troops, not hand them over. Americans must rise up against this denigration of our sovereignty and let Obama know we strongly oppose any such capitulation.

04 March 2009


People like luxury, especially if someone else is paying for it. To a remarkable extent that has generally been the case for the well-to-do. whether corporate CEO’s or officers of virtually any organization. Dinner in fancy restaurants is great as long as one isn’t paying for it personally; the same for first class travel, nice hotel suites, etc. But the same people have always been remarkably stingy when it comes to spending their own money. An airline official was once asked what question they get the most from CEOs. The answer was how to get a first class seat without paying for it. Better to spend their money on luxury items, but then there never were enough of them to support famous brands, so luxury sales always depended on wanna-bes seduced by the allure of a “brand.” That has now ended as prudence takes hold. High-end, upscale stores and brands are doing poorly in this economy. In fact the only retailer currently doing well is WalMart, and a few other downscale enterprises.


Stocks have fallen to ridiculous levels. Blue chip companies are trading in single digits and averages are reflecting a total lack of confidence in the administration’s plans. The half of the country owning stock and largely supporting the other half is bearing the brunt of the economic downturn. Trillions of dollars in savings and investments have disappeared. Major companies are cutting back dividends to conserve cash and there is no end in sight. The formerly “wealthy” have sustained most of the losses, while the superwealthy who went for Obama have more than enough to get by. Those at or near retirement are in the worst situation as the value of retirement funds has plummeted which means that many more will not be retiring as planned.

On top of this the same people will be taxed more, leaving even less for investment to drive future expansion. A dozen years of growth has been wiped out. Or has it? Are we to believe that all of these industrial enterprises are intrinsically worth no more than they were a dozen years ago? That this much wealth has simply vanished? The productive capacities of most companies remain intact. In truth the market is undervalued for the long term and now is just about the worst time to sell.

The market is where it is because Democrats are more interested in taking advantage of the financial crisis to enact a radical policy agenda (in health care, environment, and energy) rather than in solving it. Nothing whatsoever is being done to shore up the confidence of the market, whether by design or stupidity. It is true that the market may not always reflect intrinsic value, but it does reflect sentiment as to where things are headed, and right now it doesn’t look good.

02 March 2009


As if the destruction of the energy industry were not enough we are about to see the destruction of the American pharmaceutical industry by allowing cheaper imports from abroad, faster generic approval, and more FDA roadblocks to new drugs. While to some this may seem good, what incentive remains for anyone to develop new drugs and devices? A new drug can cost over a billion dollars to develop, with at best only a 10% chance of success. If there is even less chance to recoup the investment why should anyone bother to develop new products or continue to manufacture drugs in this country. Thus we will see the decimation of another industry at which we do well. As a result in the long run everyone’s health will suffer. With more bureaucratic blocks, many will die as needed drugs cannot get to market. This leaves pharmaceutical companies with little option other than gearing up or acquiring low margin generic production, or purchasing distressed biotech firms. When people’s lives are at stake the only criteria that should matter is whether a drug is harmful or not, not the preferences of bureaucrats.  

As stated earlier, in order to accommodate a fluid minority without coverage the health care of everyone else is going to be diminished. Tom Daschle says health care reform “will not be pain free,” and that." "Seniors should be more accepting of the conditions that come with age instead of treating them." That obviously means a coming wave of rationing and denial of service as bureaucrats decide on the efficacy of treatments. What is to prevent them from deciding someone is too old to bother with and should just go off and die? The American pre-eminence on the cutting edge of new technology and treatment that has given us the best care in the world will end as innovation ceases.