Inflexibility - How Will We Survive?

How many times have you tried to accomplish something at work and run smack into a solid wall of institutional inertia?

I have experienced instances where it took over a month to get a one-page letter to customers approved by 7 different departments. Being somewhat of an efficiency expert, this was particularly disturbing, so I wondered if there wasn't a better way. It seems as though the larger a company gets, the harder it is to get it to respond to change, but that is not so surprising when psychologists tell us that over 80% of the population prefers to stay comfortably within their status quo. Please, no change for me, is the mantra of these 80%ers. So it falls to those of us in the remaining 20% to convince the other 80% that change will only hurt a little while, just like the doctor tells you when he gives you a shot. You would think that with change being such a constant in life, that more people would be able to embrace change and learn how to adapt quickly. Sadly, that is definitely not the case in the American corporation or government, for that matter.

California's politicians have allowed the state to run into a financial brick wall that is $21.3 billion-high. They have squabbled constantly for years having only been able to approve a state budget on time once in 10 years. They know California's tax system is irretrievably broken and does not provide enough cash flow during the summer and fall to pay for all the state's operating expenses; so every year they borrow and borrow big. Until this year, there were always large financial institutions to help California borrow the money buy guaranteeing the loans, but now only the federal government remains in position to do so. I don't know how taxpayers in Kansas or Ohio are going to feel about spending money to support California...

California, much like the federal government, suffers from the fact that its government is held hostage by two political parties in polar opposition, both of which want to spend as much money as possible to keep their contributors and constituents happy. Unfortunately, this means all Californians have to pay to keep this system going. As long as neither political party in California is willing to step up and say enough is enough, we have to cut spending and streamline government operations, California will not recover.

We cannot even cut the salaries of these elected officials during this crisis because they enacted a law that prevented any pay cuts from happening during the middle of an elected term. Even while the governor puts all state workers on mandatory furloughs and has cut numerous positions, the elected officials do not have to share the pain.

The media has uncovered many examples of appointed officials milking the system to pay for commuting expenses between Southern California and Sacramento, just because they did not want to live in Sacramento. Most corporate employees do not get that luxury, so why should political appointees be able to feed at the public trough at the taxpayers' expense? If someones accept a position in government, why can't they find a place to live where they are going to be working or find a way to telecommute, so we don't have to pay for their commute? I wouldn't expect you to pay for my commute to work, so why do we have pay theirs?

To me, this all falls under the heading of arrogance, an arrogance that is virulent amongst many of those who have chosen to run for elected office or have chosen to run corporations. There are exceptions, but there are also too many examples of individuals who decided to put their interests ahead of the common good. We must improve our vigilance and we must decide that we have had enough of self-serving leaders.

We need more leaders willing to share the benefits of prosperity a lot more equally with those who have helped create the properity. Hard-working employees create value by being efficient and providing good customer service, so they do contribute to profitability. Why not share more of the profits with them instead of concentrating so much of them in the corporate leadership?

We have a long way to dig ourselves out the financial hole we have slipped into, so why don't we start by agreeing to share the wealth at least a little more equitably from now on. This means more people on the payroll and more people contributing to strengthening America. We also need to realize each of us has to be more responsible in our spending and saving, so that as we progress we do not create another potential disaster.

Life... Part Deux

I sit here typing this blog with heavy heart; I have one less great friend in this world. A life full of laughter, love, and music has been extinguished. My friend Jon joined all the great artists that went before him, passing away at 2:25 p.m. on Tuesday after an excrutiating battle with cancer.
His wife, sons and extended family are devastated; he was only 46 years old.

His many friends will also miss this unique man, who always tried to make everyone's life better by sharing his personal brand of humor and love of life. He expressed his love for life in many ways and left us an incredible standard of a life well-lived. He had no enemies and left no debts; he cared for those in need and worked hard to know he'd always done the best job he could.

He was a tough competitor who loved to play golf, so we spent many an afternoon in Mission Hills playing his favorite El Cariso course. He loved his brand new swimming pool and watching his kids play in it. He loved having people over to barbeque, even when it was 110 degrees and the power failed. It didn't stop him, he set up a generator and brought a truckful of ice, so the party continued unabated.

I hope each of you reading this have at least one friend in your life like Jon. If you do, then treasure them, because we are all only here for so long.

Friends like Jon are the family you get to choose.

Life...

I sit here reading about the death of Wayman Tisdale at 44 years of age from cancer. I remember when he was a star at Oklahoma and in the NBA, where he was just somebody else to cheer against since I am a diehard Laker fan. Overall, he seemed like a very nice person, and he actually went on to become a noted jazz musician after his basketball career ended. I even liked his music, so I am saddened and very surprised by his passing. I don't know what it is about turning 50 that suddenly loosens the floodgates of people passing away, because we've had more deaths and serious illnesses in our friends and families this year than pretty well all of my previous 49 years combined.

Now my best friend, Jon, lies dying in his bed from bone cancer that has spread throughout most of his body, even after losing a leg and half his pelvis. Last night, my son went to visit Jon after not seeing him for about two months, he was shocked. "Uncle" Jon has been a big part of his life and he knew it was most likely the last time he would see Jon alive.

Because we are such good friends, this week I got to share the "privilege" of telling him he had lost the battle with cancer and probably had no more than a month to live. I cannot begin to tell you how hard that was; I wouldn't wish that duty on anyone. I was touched by his bravery in the face of such pain and how much he cared for his wife and young children, but most of what I felt was heartbreak.

We have written many songs together over the 23 years that I've known Jon, but they are few compared to the hundreds of songs Jon has written. I have made him a promise to make sure his music lives on, so my sons and I are going to record a benefit album of covers of Jon's songs. We are hoping to complete it before Jon passes away, but now it is a race against time, which always seems to be a losing race these days.

More and more I am reminded that every day is a gift and we should try to make every day special for those we hold most dear. Apply Love Liberally!

Why This Economic Stimulus is Different

Well, there has already been a lot written about the Democratic economic stimulus plans, but as my wife reminded me yesterday, this time it's different.

Why is it different? Because unlike many other stimulus packages of years gone by this one actually puts more money in your pocket or presents some opportunities to some money in your pocket, if you are one of the lucky few that still have a job and can spend money. Never mind it was your money in the first place before you paid it to the government in taxes and it would have made so much more sense to not take it from you in the first place, but a large part of this package is coming back to you.

As my previous posts stated, there are some who hold the American people as being one of the causes of the financial system collapse because the American people spent every penny they had. I would say there are some Americans guilty of that, spending more than they should have on discretionary items they really did not need; but, there are so many others that were forced to spend everything they made and then borrow more just to keep from sinking. So, if you are one of those people who spent everything they had on stuff you did not need, this is your chance to learn from your mistake and actually save some of the money the government means to give you. If you were one of those people who did their best and still had to spend everything you made, then hopefully these government funds will give you a little breathing room and a little bit of money to save. The government will be grateful for the additional tax revenue from taxes on the miniscule interest we receive on our savings instruments.

Yes, the tax system will be the subject of tomorrow's post...

How We Choose Our Leaders

It seems as though many of the corporate and government leaders currently in power all come from the same places, highly regarded public and private universities, the land of the "best and brightest". I am sure these people are all getting great educations at these institutions and are building great network of other best and brightest; but, somehow those educations do not seem to be fully translating into ethical leaders.

Is there something wrong with this picture or have we as a people given too much credit to these universities as being the only source for good leaders? I would have to say it has almost become a form of discrimination in that someone who was not able to attend these universities would not be considered for many positions of corporate leadership. We currently have too many examples of this phenomenon to disregard the danger.

I, myself, get much more attention from recruiters for having attended Northwestern University for one year 33 years ago, than for a B.S. Accounting degree I recently completed. They say, "Oh, the company will like that you went there." This is even though I am applying for an accounting or finance position and I studied Engineering while I was at Northwestern. I loved being at Northwestern; it is a great school with great people, so don't think I didn't value my time there. It is just that it really has no bearing on the 20-year career I have been able to carve out in accounting and finance since I was last in Evanston, IL.

The whole purpose here is to get some of you thinking about how this prejudice may not be such a good thing for America right now. Some of our greatest citizens and leaders did not come from these backgrounds, yet now it seems as though many are shut out of any leadership opportunity simply because of where they went to school.

Food for thought....

Just so everyone knows, I will be updating this blog every day now, just because I feel like. It may not always be financial postings, but hopefully it will always be interesting.

I am currently working on starting a public charter school, so you will be seeing a link to our Non-Profit Organization site soon, just in case you want to donate to the cause. More on that subject tomorrow too.

Forbes put out a list today saying that The American Consumer was one of the 25 people who caused the failure of the financial system. Their main bone of contention was that the average consumer spent all of their income and did not save any money; running up mortgage debt, credit card debt, etc.

I also read and saw an interesting statistic, which stated the last time America had true economic growth where both wealth created and average employee compensation rose at approximately the same rate was in 1976, the end of the post-World War II expansion. It is interesting to note we are now in a period where we have the highest concentration of wealth in the last two centuries, is it possible that has something to do with average employee compensation having actually gone down for the last decade.

I watched my income grow over the last 10 years, but somehow it never seemed to keep pace with how much it cost to live in Southern California. Those of you who know us well, know we do not live an extravagant lifestyle and spend money pretty frugally. If we cannot keep up, I cannot imagine how anyone whose after-tax incomes have not risen in 10 years could keep up.

So maybe it is not entirely the average consumer's fault, since you actually have to have money left over each month to actually be able to save any money. Maybe it is the fault of those who have been dubbed the "best and brightest", the corporate leaders from America's "top" universities and business schools, many of whom are now begging at the Treasury window for funds from the public to save their precious corporations. Just look at the other 24 people on the Forbes list to see glaring examples of these so-called "best and brightest".

More on the "best and brightest" tomorrow...