Chimerica

Niall Furgusen has a good piece in today’s Washington Post regarding the history making week we just experienced. Deferring the dark economic realities exposed and just considering the election, one might rejoice at the rude and bright jolt of reality crashing the scene and causing quite the ruckus. As one of the talking heads aptly noted, "We’re not talking about lip stick anymore."

Indeed. Nausea and disgust pushed me away from the keyboard (prolificity has yet to recover) as I saw so many know nothings fall hard for the amazingly cynical and (when understood) outrageously insulting nomination of Sarah "Twiddledwat" Palin for Vice-President. Only minutes into her RNC speech many (we now know) experienced the same revulsion I felt as she lied and contemptuously mocked what can now be seen as beyond her grasp in life. Obama has already “been there and done that” in a dozen realities Sarah Palin will never see or consider let alone comprehend. The news sites now have ample information about a creature more befitting a freak show than elected office.

The week dramatically amplified public awareness that neither Twiddledwat nor McCain have the slightest education in modern economics. McCain could not have gone farther with the pooch with his Monday “The economy is strong” declaration as Wall Street made world history. McCain continued to dig with gaffe after slip after mistake, from the senseless "shame and blame" damnation of SEC Chairman Christopher Cox (like it’s this guy’s fault?) to the embarrassing shift from a 30-year assault on regulation to declaring "I am a regulator" (oh, the humanity!) to ludicrous statements calling for the de-regulation of health care (great timing, John).

Fueled by public consternation with the Carter Administration, Reagan successfully shifted the Washington culture to one consistent with the conservative idea that "government is bad" and a burden to its people. We needed to "get the government off the backs of the American people." Reagan broke unions, gutted regulation, trashed funding for the arts, education, and other public service institutions. The mentally ill were tossed into the streets and then (predictably) prisons. Care to calculate the return to the taxpayer on that investment? Government = Bad. Corporations = Good. Oh yes, and deficits don’t matter.

Whoops. Now, instead of adults that operate responsibly given freedom, our corporations occur as four-year-olds with their hands stuck in cookie jars crying for mommy government. Should they be allowed to enjoy windfall profits and amass personal fortunes with the accumulated tab left for the taxpayer? What is the political shelf life of that scenario, now brought to light with a $700 BILLION figure on the front page of almost every paper in the country? It is too early today to witness the impending resentment, and $700B is just a start.

Meanwhile, how does a self-respecting Republican look in the mirror now that Iraq and Afghanistan have bitch slapped the world conquering neo-cons bloody and stupid and now that they’re down, undergraduate economics has kicked them in the nuts to where they sound like kids in grammar school? How is GM faring against Toyota? United States bravado is dead.

The existing paradigm of the corporation has become obsolete. Sooner or later (given this past week, sooner, I think) meaningful numbers of citizens will start to understand some of this, but a full blown perspective requires one to go global and consider Chimerica, a name coined by Ferguson and Moritz Schularick in their 2007 paper that distinguishes the combined economies of the United States and east Asia, most notably China (of course) but also India and some others. Calling America "West Chimerica" and China "East Chimerica" yields a rich discussion of the global economy and the major forces at play regarding recent developments.

The paper is written at the academic level and includes a little math (McCain wouldn’t understand it), but in a sentence it notes the combination of the cheap East Chimerican labor market with the insatiable (and borrowing into oblivion) West Chimerican consumers. The West continues to borrow and buy. The East doesn’t have to borrow to buy, and they’re buying us.

Truth and Illusion II

Tucson, Arizona. The TREO clothmeisters sent out an email blast Wednesday pontificating their satisfaction with the results they've produced over the past several years. Let's consider some of the semantics.

TREO assisted in the attraction and/or expansion of 11 companies

Did they now, or did they happen to sit in on a meeting with a company already moving here when PICOR real estate showed them some commercial site options? Also, who was attracted that actually located here and when? Who expanded, and are we really to believe that the expansions were due to TREO? What did TREO actually DO that altered what would have happened otherwise? Ever expand your business? TREO generated the increase in sales, not satisfied customers or your marketing efforts.

representing 1,739 total new jobs supported, $88,196,901 in new capital investment and $241,813,414 in total economic impact. What jobs where at what wages since when? Solid information is not provided, and should one require such detail, the house of cards falls flat, especially the interpretation regarding capital projects, and most of all the total economic impact, where they use a ridiculously flattering multiplier (like three).

Here's the one I like: For every $1 invested in TREO, $76 is returned to the community in new wealth. This is the assertion that could make certain people retch. The number is so over the top ludicrous it is embarrassing. Seventy-six to one. Think about that.

I have no training in public relations, but even I seem to recall that when one wishes to put out material to tell the world how wonderful one is, protocol calls for the use of a third party, someone who appears to be as objective and trustworthy as possible. Naturally the individual just says whatever the prepared statement tells him to say, but at least the message is coming from someone else.

"TREO has consistently delivered on its promise to the Tucson region," said Joe Snell, president and CEO. "TREO has a razor-sharp focus on its mission of developing higher-wage, primary jobs within a coordinated, regional approach. Our return on investment by public and private partners is significant."

Significant? 76 to 1 is significant? It defies comprehension until one realizes that it simply follows a calculation, not real dollars in a real economy. The more accurate picture shows them sitting in meetings. They rush to meetings where Business A explores a deal with Businesses B and C. They smile and nod and shake hands. They declare themselves Major Players in town. Sometimes something happens, and other times it does not. They keep track. When something happens they take credit for the result. Businesses A, B, and C tolerate them for PR reasons.

Other significant highlights:

Development of the Blueprint Mobilization Plan. Good. We need to DEVELOP a PLAN to mobilize the PLAN we had a consultant make two years ago.

Endorsement of 50+ community partners in advancing strategies. Isn't a strategy a PLAN? Now we have people to endorse the advancement of a PLAN.

Development of a Community Report Card More numbers like the above that don't include specific measurable results with names, companies, dates, times, and places. If they get lucky, perhaps a business has figures solid enough to share, but this is rarely the case.

Development of marketing strategies and programs. A PLAN for promoting the PLAN.

Coordinated International business development strategy. Instead of developing, perhaps they only coordinated (sat in the meeting) the development of the PLAN. Oh, wait. They coordinated the plan to develop the plan.

Launch of Targeted Industry Planning Councils.

Perhaps the email's timing had something to do with the Marana council vote 5-2 Tuesday night to keep its $50,000 and zero its support for TREO. Sometimes the astute reader can see the truth seeping from the text. Directly from the article:

The council also noted that Marana isn't home to any of the 26 businesses in which TREO credits itself with having a role in the relocation to or expansion within Southern Arizona.

Like the kid pointing to the naked emperor, councilwoman Roxanne Ziegler was easy to understand. No plans. No strategies. No fancy language. Sometimes reality feels like a breath of fresh air, "I asked staff what TREO has done for us for the last three years, and they handed me a blank piece of paper."

Truth and Illusion

Martha: Truth and Illusion, George. Don't you know the difference?
George: No, but we must carry on as if we did.
Who's Afraid of Virginia Woolf?

As already written, my hair started to bristle when Sarah Palin got about five minutes into her RNC speech and started mocking Barack Obama with deliberate distortions and in some cases outright lies. She dutifully delivered the fabrications of the speech writers seemingly without a care in the world for their validity. We now know the GOP deliberately compressed the speeches in succession to prevent media commentary between them. Now why wouldn't they want to give anyone the opportunity to comment while the masses were still tuned in?

I found Karl Rove's transformation of what constitutes presidential readiness particularly telling. Starting with his remarks on VA Governor Tim Kaine as a possible Obama VP: He's been a governor for three years. He was Mayor of the 105th largest city in America. With all due respect to Richmond, Virginia it's smaller than Chula Vista, California, Aurora, Colorado, Mesa or Gilbert, Arizona, North Las Vegas or Henderson, Nevada. It's not a big town. So if you were to pick Governor Kaine it would be an intensely political choice where he said, "You know what, I'm really not first and foremost concerned with whether he's really ready to be president of the United States."

Got that? Rove argued that Kaine was completely unprepared to become president after three years as governor (VA - pop. 7.7 M), didn't note his years as Lt. Gov but did recall his having been mayor of a "small town" (pop. 200,000). Within weeks we have Rove on Sarah Palin: She's a populist. She's an economic and a social conservative. She's a reformer. She's a a former Mayor. She was the Mayor I think of the second largest city in Alaska before she ran for Governor.

Of course it doesn't particularly matter whether Wasilla (pop. 9,000) is the second largest city in Alaska (of course not). Do you think Rove thinks it is? Uh-huh. McCain repeatedly declares he can work "both sides of the aisle" and falsely asserts Obama has not. Think McCain is just mistaken? Why intentionally lie? Because it works. Some insightful Republicans, in particular those involved with GOP approved faith based initiatives, clap a little uneasily at the McCain and Palin bombasts of a "community organizer" and what Obama did (he worked with many churches). They see their nominees eviscerating efforts little different from their own. But, of course, they don't say anything.

While grabbing a quick bite yesterday I ran into someone from the Tucson economic development days. I recognized him at once but was unsure if he remembered me. After a moment he approached, "We have something in common."

I replied, "So you know about all of that?"
He smiled, "Oh, yeah. I've read about it, heard about it."

The man appeared most eager to speak, so I offered him a seat, and off he went about his disgust with TREO, noting the various lies and distortions. He said, "Whenever I meet with those guys, I feel like I've been slimed and want to take a shower."

Unlike students at a university, TREO not only grades itself but writes the report card. It gets to retroactively make up the whole thing, circles and arrows, multipliers, lists, anything goes that is not immediately recognizable as false (i.e. built the world's largest indoor ski resort at 4th Ave and 9th Street). Since Tucsonans are the poorest of any city in Arizona with a per capita income below $20K, it's safe to say this measure won't be graded. Causing nothing, the Cloth cannot project performance. They must wait to see what happens in order to take credit for it using the most legitimizing voice they can find, a high level cosmopolitan executive entirely too busy with a real job to raise questions or disrupt their petty politicking for handouts at the local trough.

In what I found ironic, the man looked directly at me and asked, "Why doesn't anyone come forward?"
I looked at him for a moment and remarked, "Well, I've been doing my small part."
I paused, "Why don't you say something?"
"I don't want to lose my job."

Knowing his position, I seriously doubt he has cause for fear, but justified or not, the fear stops him dead in his tracks, just as it stops the rest of the herd. We see everyone charging in a certain direction and question our own judgment. We doubt our own perception and understanding. In chapter 1968 of Something Else, a seven-year-old boy finds his way out of a maze designed to trap sheep. As if grasping reality were not difficult enough, we are designed to seek the approval of those around us. Should the herd have a different view, cowardice and self-doubt suggest we muzzle our own instincts. In the maze, the boy did not have to convince others. A deeper than average insight wonders if he would have thought to turn left when surrounded by others pushing forward. Like it or not on Earth we're stuck in the maze together, and the herd is anything but wise. All that is necessary for evil to triumph is for decent people to do nothing.

Citizen Scratches TREO

Tucson, Arizona. Tucson Citizen reporter Carli Brosseau has an article today discussing TREO's theft of funding allotted to the Microbusiness Advancement Center, small potatoes compared to TREO's slaughter and destruction of the non-profit Southern Arizona Institute of Advanced Training (SAIAT), a theft of hundreds of thousands of dollars in both city and county agency funding. The first comment at the online version of the story provides a link to Something Else, the full story of SAIAT's destruction at the hands of TREO CEO Joe Snell. Snell signed a contract with SAIAT board members (no disclosure to SAIAT). By "sheer coincidence" the next month Solutus tried to fire the SAIAT director and take his place.

The press knows all about SAIAT's demise, but the Cloth effectively muddied the red water by having Southern Arizona Leadership Council (SALC) indoctrinated former state representative Carol Somers (my successor) steer the bullets in my direction with remarks critical of the chairs on the deck after the torpedoes struck the hull. Chapters 10-14 of Something Else capture the bloody mess. The whole fiasco is receding from my consciousness as we speak, my departure from Tucson now within months, but it is nice to see the awareness slowly spread. Today's piece calling on TREO to explain its usurpation of funding allotted to another agency, yet keeping the money for itself and not returning it, says enough. They're thieves.

To the City Council, I would argue that the contract should specify that TREO return to the city all funding it chooses to withhold from other agencies. We wouldn't want to create the impression that the city is condoning fraud. TREO is dishonest and dishonorable, even bragging about the money they stole as representative of "improved financial performance" in their annual report. Yes, it is as disgusting as it looks and sounds. All involved have cause for shame. One can honestly adjust funding. This was stealing, lying about stealing, and malice.

SAIAT Letter to TREO: Please leave our funding unchanged
Snell Lying to the County that SAIAT approved TREO's taking its funding
Undisclosed TREO/Solutus Contract asking SAIAT Board Members to compete with SAIAT
The same board members, the next month, try to fire the SAIAT Director.
SAIAT Attorney noting Unlawful Conflict of Interest

You know what a hosser is? That's a pig that don't fly straight.
Tony Montoya, Scarface