:: KipperCat :: =^. .^=

:: Friday, May 30, 2003 ::

:: posted by JRH ::

Rachel Lucas is losing patience

And I don't blame her. A great rant about anti-gun idiocy.

:: -- JRH 5/30/2003 02:08:57 PM [+] ::
...

:: posted by JRH ::

Regarding tax cut fantasies

JaneGalt has a very good debunking of a Salon article criticizing the recent tax cut. She sums it up by saying:

"Pointless articles like this are not helpful. The only extent to which they work is the extent to whcih the readers don't notice the number flummery. If you can only make your point by deceiving your readers... well, maybe it's time to look for another point."

Exactly.

:: -- JRH 5/30/2003 01:05:07 PM [+] ::
...

:: Wednesday, May 28, 2003 ::

:: posted by JRH ::

The Divine Right of Capital

The Divine Right of Capital: Dethroning the Corporate Aristocracy, by Marjorie Kelly, editor and publisher of Business Ethics magazine was published in 2001. The premise is that while the American Revolution did away with the divine right of kings, the rise of corporations has resulted in the evolution of an economic aristocracy of the wealthy. The foundation of this aristocracy is the corporate mandate to maximize the return to stockholders.

Kelly uses extensive metaphor to compare corporate stockholders to 18th century French and English nobility who did no work but derived their income from their lands worked by serfs, and compares corporate employees to the peasants and serfs whose labor produced the income which flowed to the nobles.

The metaphor is strong, but the reasoning is flawed. The basis for the comparison of stockholders to nobility is that they (she says) have the right to extract wealth from the corporation in return for nothing.

Equity capital is provided by stockholders when a company goes public, and in occasional secondary offerings later. But in the life of most major companies today, issuance of common stock represents a distant, long-ago source of funds, and a minor one at that. What’s odd is that it entitles holders to extract most of the corporation’s wealth, forever.

Equity investors essentially install a pipeline, and dictate that the corporation’s sole purpose is to funnel wealth into it. The pipeline is never to be tampered with — and no one else is to be granted significant access (except executives, whose function is to keep it flowing).

The truth is, the commotion on Wall Street is not about funding corporations. It’s about extracting from them.

In other words, unless they by stock directly from the corporation, stockholders do not invest in corporations, they invest in the stock market and the corporation derives no benefit from the "investment". What's more, because the corporation must maximize the return to the stockholders, it does so at the expense of the employees who are directly involved in producing the wealth that is being distributed.

Unfortunately, she then refutes herself a few pages later by saying:

Stockholders are theoretically said to have a right to all of [the profits], and in an earlier age this was apparently true....But today stockholder get only a piece of earnings (about a third) in dividends. The rest is kept as retained earnings, to be used by the corporation.

There is the continual investment that the stockholder makes. The stockholder is not taking all of the value out that he/she is entitled to. Retained earnings not paid out to stockholders is reinvestment being made by the stockholders. By Kelly's own example, the average stockholder reinvests twice as much as is taken out. But this is only for companies paying dividends. For companies that pay no dividends, the stockholders take nothing out of the corporation as they receive none of the profits. Because of this 100% reinvestment, the value of the corporation grows and so does the value of each share.

Yet Kelly says:

Equity represents the actual capital stockholders contributed when they purchased new shares. And the retained earnings portion of profit is added to that equity each year. Thus by the magical closed loop of accounting, equity grows year after year, while stockholders never contribute another cent.

No, not another cent, just two-thirds of the reward they are entitled to (twice as much as they take out).

But why are stockholders entitled to all of the profits in the first place? Because they own the damn company! Yes. They really do.

If you own a company as a sole proprietor, you are entitled to 100% of the profits. If you take on an equal partner, you are each entitled to 50% of the profits because you each own 50% of the company. If you sell shares in the company, then each shareholder owns the percentage of the company represented by the shares of stock they own and they are entitled to an equivalent share of the profits. All of the shareholders (i.e. all of the owners) as a whole are entitled to all of the profits.

An owner of a business is entitled to the profits from that business for as long as he owns the business. If he sells the business, he is no longer entitled to the profits, the new owner is. Likewise, a stockholder is entitled a share (dividend) for s long as he owns the stock. If he sells his share to a new owner, the new owners has the same right to the profits as the original owner. And if he does not receive all that he is entitled to, then what he does not receive is a reinvestment. I don't know why that is so hard to understand.

Why are stockholders favored over employees? It goes to the issue of risk and reward which I discussed previously. Employees, since they receive a paycheck whether the company is profitable or not, trade their interest in future profit for a steady income. Stockholders take the risk that there will be no income unless the company is profitable and this risk commands a higher reward. Lets go back to retained earnings for a moment. In companies that do not pay dividends, and there are a lot of them, the stockholder receives nothing until he sells his stock to the highest bidder. If he has made a good investment, the earnings retained and not paid out in dividends will have increased the value of the corporation and thus the value of the stock. But if not, he will lose money. Is this gambling? Speculation? No more so than when a man builds better mousetrap and hopes to sell it. If people buy his mousetrap, he makes money, if not, he loses.

Another complaint Kelly has is the that employees are carried as an expense and this makes them a target of cuts when business is bad. I tend to agree with her to some extent here. Employees are more than an expense. Good employees are an asset and assets add value, they do not reduce it. Many companies recognize this and pay bonuses to employees when profits are good. Many new corporations, especially technology companies, pay employees in salary and stock options. Employees thus have a stake in the success of the company and are entitled to both share in the profits and reinvest in the corporation just like other stockholders. They are also entitled to sell their stock like any other stockholder and many do.

Of course, as we saw in the technology and dot-com bubbles, in companies that are not profitable, stock options may be the major component of employee compensation and employees get to assume the same risk as the stockholder. If the company does not succeed, they never get paid. And when they don't get paid, being a stockowner doesn't seem like such a good idea. The fact is, most employees don't want to assume risk, and wait for reward that may not come. they want a paycheck every two weeks. They want the check because the can't afford the risk. Investors assume the risk because they can afford to do so. And Marjorie Kelly doesn't like it.

Where does wealth come from? More precisely, where does the wealth of major public corporations come from? Who creates it?

To judge by the current arrangement in corporate America, one might suppose capital creates wealth — which is odd, because a pile of capital sitting there creates nothing. Yet capital-providers (stockholders) lay claim to most wealth that public corporations generate. They also claim the more fundamental right to have corporations managed on their behalf.

Wealth is created by the combination or labor and capital. Capital without labor creates nothing because there is nothing to work on it. Labor without capital created nothing because there is nothing to work with.

What do shareholders contribute, to justify the extraordinary allegiance they receive? They take risk, we're told. They put their money on the line, so corporations might grow and prosper.

Let’s test the truth of this with a little quiz:
Stockholders fund major public corporations — True or False?
False. Or, actually, a tiny bit true — but for the most part, massively false.

To the contrary, this is very true, as shown by her own example of retained earnings.

In fact, "investing" dollars don't go to AT&T but to other speculators. Equity "investments" reach a public corporation only when new common stock is sold — which for major corporations is a rare event. Among the Dow Jones Industrials, only a handful have sold any new common stock in 30 years. Many have sold none in 50 years.

Sorry, that does not follow. An owner of a business is entitled to the profits for as long as he owns the business. If he sells the business, he sells not just the present value of the assets, but the future value of the profitability of the business. To receive value now, future profitability is discounted and the new owner assumes who is buying the present value and future profits assumes the risk of failure.

An investor buys a share of a company. The investor becomes part owner. A part owner is entitled to a part of the profits. As an owner can sell a business, a part owner can sell his part. The new part owner is then entitled to the same part of the profits, including future profits. But by your own example, the stockholder rarely gets all that he is entitled to.

By her own description, stockholder are only paid 1/3 of the profits they are entitled to (as owners, they are entitled to 100%). So by your own description, stockholders are continually reinvesting in the corporation. Retained earnings are added to equity because that is what it is; it is an investment, just like the stockholder's initial investment.

The stock market works like a used car market, as accounting professor Ralph Estes observes in Tyranny of the Bottom Line. When you buy a 1989 Ford Escort, the money doesn’t go to Ford. It goes to the previous owner. Ford gets the buyer’s money only when it sells a new car.

Other than buying and selling, the stock market works nothing like a used car lot. This is a false analogy. When you buy a new car, you are not buying a share of Ford. When you buy a used car you are not buying a share of Ford. You are comparing apples and anthills---there is no analogy.

Similarly, companies get stockholders’ money only when they sell new common stock — which mature companies rarely do. According to figures from the Federal Reserve and the Securities and Exchange Commission, about 99 percent of the stock out there is "used stock." That is, 99 out of 100 "invested" dollars are trading in the purely speculative market, and never reach corporations.

Public corporations do have the ability to sell new stock. And they do need capital (funds beyond revenue) to operate — for inventory, expansion, and so forth. But they get very little of this capital from stockholders.

In 1993, for example, corporations needed $555 billion in capital. According to the Federal Reserve, sales of common stock contributed 4 percent of that. I used this fact in a pull-quote for a magazine article once, and the designer changed it to 40 percent, assuming it was a typo. It’s not. Of all capital public corporations needed in 1993, stockholders provided 4 percent.

Well, yes, critics will say — that’s recently. But stockholders did fund corporations in the past.

Again, only a tiny bit true. Take the steel industry. An accounting study by Eldon Hendriksen examined capital expenditures in that industry from 1900 to 1953, and found that issues of common stock provided only 5 percent of capital. That was over the entire first half of the 20th century, when industry was growing by leaps and bounds.

So, what do stockholders contribute, to justify the extraordinary allegiance they receive? Very little. And that’s my point.

Equity capital is provided by stockholders when a company goes public, and in occasional secondary offerings later. But in the life of most major companies today, issuance of common stock represents a distant, long-ago source of funds, and a minor one at that. What’s odd is that it entitles holders to extract most of the corporation’s wealth, forever.

Equity investors essentially install a pipeline, and dictate that the corporation’s sole purpose is to funnel wealth into it. The pipeline is never to be tampered with — and no one else is to be granted significant access (except executives, whose function is to keep it flowing).

The truth is, the commotion on Wall Street is not about funding corporations. It’s about extracting from them.

Once again, by her description, stockholders are only paid 1/3 of the profits they are entitled to (as owners, they are entitled to 100%). So by her own description, stockholders are continually reinvesting in the corporation. Retained earnings are added to equity because that is what it is--and investment, just like the stockholder's initial investment.

The productive risk in building businesses is borne by entrepreneurs and their initial venture investors, who do contribute real investing dollars, to create real wealth. Those who buy stock at sixth or seventh hand, or 1,000th hand, also take a risk — but it is a risk speculators take among themselves, trying to outwit one another like gamblers.

No, all stockholders assume risk for the corporation. As she has described, retained earnings are real investing dollars. Any stockholder that does not receive his full share of the profit is assuming the risk that the company will be unprofitable in the future and the investment as well as his interest in future profits for which he paid, will be lost.

It’s odd. And it’s connected to a second oddity — that we believe stockholders are the corporation. When we say "a corporation did well," we mean its shareholders did well. The company’s local community might be devastated by plant closings, its groundwater contaminated with pollutants. Employees might be shouldering a crushing workload, doing without raises for years on end. Still we will say, "the corporation did well."

One does not see rising employee income as a measure of corporate success. Indeed, gains to employees are losses to the corporation. And this betrays an unconscious bias: that employees are not really part of the corporation. They have no claim on wealth they create, no say in governance, and no vote for the board of directors. They’re not citizens of corporate society, but subjects.

Investors, on the other hand, may never set foot inside "their" companies, may not know where they’re located or what they produce. Yet corporations exist to enrich investors alone. In the corporate society, only those who own stock can vote — like America until the mid-1800s, when only those who owned land could vote. Employees are disenfranchised.

The employee does not put the value of his labor at risk. He exchanges it for immediate reward in the form of wages. Employees exchange risk for security. They do this because the do not want to take the chance that the company will not make money and their labor will be unrewarded. So they accept present value of the labor rather than wait for a share of the potentially greater value that results from the combination of labor and capital.

The employee can put his labor at risk. In some companies, employees accept lower wages but receive stock options. These options are not a gift, they are a recognition that the employee has assumed some risk in accepting a lower wage. This assumption of risk entitles the employee to a share of the future profitability of the company instead of just the present value of his labor.

Investors do not have to set foot inside a company to make their critical contribution: the assumption of risk. The initial investor takes the greatest risk, and generally, reaps the greatest reward when the stock price increases with the company's success. But as part of his investment, he is also entitled to a share of profits for as long as he owns the stock and the company is profitable. Later investors assume a lesser risk so they may not see as much growth in stock price. If the company pays dividends, they are entitled to those as a share of the profits. But if it does not pay dividends, they will have less reward. But again, for less risk.

We think of this as the natural law of the free market. It’s more accurately the result of the corporate governance structure, which violates free-market principles. In a free market, everyone scrambles to get what they can, and they keep what they earn. In the construct of the corporation, one group gets what another earns.

No, the investors earn their share of the profit by assuming risk. There are different levels of risk that can be assumed. Bondholders assume less risk and receive interest on the money they loan to the corporation. The interest reflects the risk they assume, but the loan is a liability and the bondholder is creditor who will be repaid before the stockholder's profit is calculated. Thus, the bondholder has a lower risk and a lower reward.

The employees assume little or no risk and accept payment for their labor. By assuming no risk, they are not entitled to a share of the profits, though they may be rewarded with bonuses.

The oddity of it all is veiled by the incantation of a single, magical word: "ownership." Because we say stockholders "own" corporations, they are permitted to contribute very little, and take quite a lot.

She really gets carried away with this idea that stockholders contribute little. Without stockholders, who would assume the risk? Employees don't want to do it because they can't afford to. They need the steady income. Only someone with sufficient cash reserves can afford the risk. And without someone to assume the risk and provide the capital, there would be no work for the employees.

What an extraordinary word. One is tempted to recall Lycophron’s comment, during an early Athenian slave uprising against the aristocracy. "The splendour of noble birth is imaginary," he said, "and its prerogatives are based upon a mere word."

But the risk assumed by the stockholder is real, not imaginary, and the reward for assuming that risk is well earned.

I could go on, but the rest of the book is more of the same. Kelly's style is pejorative argument. She assigns negative labels to that she wishes to demonize then uses the definitions of those labels to support her arguments. But she provides very little hard data to support her labeling. The term "stockholder" is used interchangeably with "monied class", but the majority of stockholders are not extraordinarily wealthy (you don't have to be rich to own stock, you just need to be willing to assume the risk). Kelly's appeal is to the emotion, not to the mind; she seeks visceral reaction, not reasoned thought. Two passages demonstrate this.

Shareholder primacy emerged from the ether in the mid nineteenth century when it was articulated by the courts. The basis for shareholder primacy is common law, judge-made law.

But common law is definitely not "judge-made law". Common law the "law of the commons", established through custom and practice and judicially recognized by the courts as legally binding. If shareholder primacy is based in common law, it is based in centuries of custom and practice and did not "emerge from the ether" at the whim of a judge. But Kelly wants us to believe that shareholder rights are something dreamed up by a judge to protect his rich friends. When common law is viewed correctly, it stands Kelly's theory on its head.

[Shareholder primacy] stems from the seafaring age, when persons jointly financed ships and sought to hold the operators accountable so money would not be wasted....One might add, parenthetically, that the custom of investor primacy once permitted piracy--as seafaring vessels were legally permitted to attack other ships and seize their cargo....One might suppose evenly modestly civilized thinking would have led us to carve out a "piracy exemption," saying corporations should maximize returns to shareholders, but they should avoid piracy. But we haven't gotten even that far yet.

Piracy was never legal, though some countries did not consider it to be illegal. It is one of the oldest crimes on the high seas. In times of war, private vessels are issued letters of marque which authorizes them to attack enemy merchant ships. These are privateers, not pirates. Congress is authorized to issue letters of marque in Article ! Section 8 of the US Constitution. But Kelly would have us believe that corporations loot and pillage on behalf of stockholders and since she has chosen metaphor as her vehicle, she created one. Here is an idea that emerged from the ether.

She has some ideas that might be worth considering if she did not illegitimize those ideas with her methodology. Her conclusions are as credible as the Salem witch trials and so are her ethics. From this, it is easy to see that Kelly is pursuing an agenda grounded not in ethics but in a socialist/communist ideology of class warfare. If one accepts her initial premise that stockholders only take profits from a corporation and put nothing into it, then the metaphor of a corporate aristocracy might appear to apply and the rest of her arguments are easier to follow (or swallow?) But if the premise is false (which she demonstrates by her own examples), then the rest of her arguments have no basis and the reader must constantly remind himself just what she is talking about. In the later chapters Kelly apparently assumes the reader has accepted the initial premise and provides no reinforcement. I suppose this is understandable--if you don't accept her metaphorical premise, further reading is a waste of time.

Reading this book was a challenge. I have read Nazi and KKK material regarding inferior races and the experience was like drinking Drano. Reading The Divine Right of Capital was not much different. Instead of an idea worth considering, she seeks to convey an ideology of class hatred under the guise of ethical conduct. Actually, Drano might be more palatable.

:: -- JRH 5/28/2003 09:33:11 PM [+] ::
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:: Thursday, May 22, 2003 ::

:: posted by JRH ::

Guns, guns, guns

The media is biased? I'm SHOCKED!

Did you know that guns cause terrorism?

Another one bites the dust

At least one judge gets it.

A new NRA T-Shirt? "The 2nd Amendment: The first Homeland Security Act."

And finally, an alternative to the 2nd Amendment:



The truth about Bowling for Columbine.

:: -- JRH 5/22/2003 09:47:50 AM [+] ::
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:: Wednesday, May 21, 2003 ::

:: posted by JRH ::

This quiz says I'm a...

What Is Your Animal Personality?
brought to you by Quizilla

:: -- JRH 5/21/2003 06:36:41 PM [+] ::
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:: Saturday, May 17, 2003 ::

:: posted by John ::

Capital & Labor: an Old Story Still Looking for Resolution

Since I am still new to supply side theory, I will opt to wrestle with nuts & bolts of work. It adds up to much the same, except many millions (here) are part of the labor portion.

As a disclaimer, I am not terribly upset per se with uneven distribution of wealth; if anything I would prefer that our government be a little less involved in re-distributing it through graduated income tax. But, that tale of pain and suffering is for another time. I will endeavor to concentrate on those aspects of “Risk & Reward” that trouble me.

Rather than wrestle with the position that labor is paid from capital, I would like to focus on a two-fold aspect of the employee/employer relationship. One, that the employee assumes no risk and the two, the inherent problem relating to the on- going struggle to determine what a “fair” wage is. Since I have only briefly been in a union (many, MANY years ago-and I did not really understand what I was doing at the time) I will expound on the second part first.

A “fair” wage is what you (the employee) think you are worth. If you are currently working, and being paid the wage is fair. If you are unhappy with the wage, then you owe it to yourself and your employer to seek another job that will pay you more. That said, my other insight is that since a paycheck comes out of the profitability of the employer, your employer is always going to try to keep your compensation as low as possible. This is neither cruel nor unusual; it is the “company” trying to maximize profitability. So, with this before us; allow me to take it down to the “trenches”. I work for a living; I have been in the same basic industry for the last quarter of a century in a line of work that is pretty much learned "on the job”. So, I have twenty-five years of experience, expertise and connections within my line of work that I bring with me everyday to the job. This experience, et.al. allows me to do my job faster, better and more efficiently than someone that is just entering the industry. From my conceited point of view, this makes my skill more valuable than someone that is just starting and I expect to be compensated accordingly. But, remember, my employer has a vested interest in keeping their cost as low as possible; so we negotiate. If I decide that I am being severely under-paid, then I will pick my stuff up and go else where.

It has been pointed out that the cost of an employee comes out of capital; again, I am not competent to contest that. I will point out that many industries require that there “be” employees; the enterprises are simply too large for one person or even a small group of entrepreneurs to engage in. So, like it or not, the employee is part of the process of making a capitalist endeavor generate capital growth, if in no other way, profit on the investment the person or persons made in order to establish the business. And it is here that life gets complicated. What is the “value” of an employee? They have to be paid something, slavery being dead in this country since the Emancipation Proclamation and subsequent amending of the Constitution following the Civil War (I DO sometimes wonder if all employers are aware of this… but like taxes that is an issue in its own right). In the early stages of the Industrial Revolution, the owners and operators of the fledgling factories and businesses paid as little as possible and worked their employees as long as possible. In mill and mining towns, the development of “factory” and/or “mine” towns was not an exercise in owner kindness, but rather a means by which the labor force could be maintained as close to the place of business as possible so that minimum time was lost between shifts. There were other side issues such as the rents and “credit” at the company store, but those issues are not central to this discussion. Labor unions grew out of the efforts of the employees to get a better wage and/or lower hours from their employers. In this country, the nineteenth and early Twentieth Centuries are very much defined by this struggle.

Ironically, one of the more successful businessmen of the early 20th Century, Henry Ford, not only avoided some of the worse confrontations with unions; he discovered that he possessed his own ready market in his employees. He voluntarily gave his employees an above average wage without then need of the unions striking for it; the reason was simple. By paying the employees more he was able to attract better help and keep his labor base stable. The real coup was the fact that by doing so, he also was developing his best customers; his employees had enough surplus cash to buy a Ford. Neat trick, I often wonder why more businesses have not noticed the advantages of this.

Which takes me, at least briefly, back to my other point. A good employee does have a very deeply vested interest in the profitability of the company he works for. After all, if the company goes under or becomes less profitable; the employee will join the ranks of the unemployed where compensation is at a MUCH lower level than working. A good employee looks for ways to make his situation more profitable, not for the sake of the company but for his own sake. In an “ideal” situation (kind of like economic theory), the employee realizes these aspects of being employed and works to the betterment of the business. Again, this is self-interest same as Henry Ford paying his employees a higher than industry standard wage. If you work to improve the enterprise, either cutting cost or improving profitability then you should be regarded as a valued employee and compensated in return.

Where all this fits into supply side economics, I will wait for another posting to discover. I just thought that the nuts and bolts side needed a little exposure (yes, I am one of the “nuts” that attaches to the bolt to try and keep the whole thing going!).


Update: Jim Hart comments :: 5/19/2003 11:02 PM ::

A few comments:

First, to the last. You say:

Where all this fits into supply side economics, I will wait for another posting to discover.

Don't get too hung up on supply side theory. Supply side theory is just a small part of the body of economic theory and not very much of what we have discussed here has much to do with supply side theory.

You say:

"A “fair” wage is what you (the employee) think you are worth. "

Well, no. A fair wage is a compromise between what you think you are worth and what your employer is willing or able to pay. A fair wage is the result of negotiaion between employee and employer. Without negotiation, there is no fairness (which is one reason why a government imposed minimum wage is not a fair wage, but that is another story).

You say:

a paycheck comes out of the profitability of the employer,

No, it doesn't. It comes out of the cash reserve of the employer. There are a great many unprofitable companies issuing paychecks. The long-term ability of the employer to replenish his cash reserve depends on his profitability, but that can be a very long term consideration.

You say:

your employer is always going to try to keep your compensation as low as possible.

A smart employer is going to try to keep compensation as low as necessary to keep the employee happy or at least willing to work efficiently and still remain in business.

You say:

Henry Ford, not only avoided some of the worse confrontations with unions; he discovered that he possessed his own ready market in his employees. He voluntarily gave his employees an above average wage without then need of the unions striking for it;

Excuse me? There is a bit more to the story.

In 1916, Henry Ford paid his workers higher wages to keep them from changing jobs, and probably to undermine the union attempts to organize. He avoided labor problems all right. Unions couldn't strike if they wanted to because there were no unions at Ford. Ford refused to recognize the United Automobile Workers Union for years and used armed guards and police to deal with union organizers and industrial unrest.

In nineteen-thirty-two, hungry, unemployed men marched near the Ford factory. Police, firefighters and Ford security guards tried to stop them with sticks, high-pressure water and guns. Four of the marchers died, and twenty were wounded. Ford dismissed all workers who attended funeral services for the dead.

In nineteen-thirty-seven, union organizers were passing out pamphlets to workers at the Ford factory. Company security guards struck. They were led by the chief of security, Harry Bennett. Harry Bennett knew nothing about cars. But he did know what Henry Ford wanted done, and he did it.

The Ford Motor Company did not agree to negotiate with the UAW union until nineteen-forty-one when Henry Ford finally accepted a government mandated agreement. If he had not, his company would have lost millions of dollars in wartime government business.

You say:

I often wonder why more businesses have not noticed the advantages of this.

They may have, but most companies don't have such a general use product as an automobile. How much air freight do you personally ship per year? How much more would you ship if you got a raise?

Early on, Henry Ford did pay his workers more than other manufacturers, but he also sold his cars for less. As a result, Ford sold more cars to more people, brought in more money (though with less profit per unit), and became very successful. But other companies soon started selling low priced cars as well and when Ford was forced to accept the union, Ford lost much of the early advantage that it had.

-JRH

:: -- John 5/17/2003 08:20:12 PM [+] ::
...

:: Friday, May 16, 2003 ::

:: posted by JRH ::

OK, so who is Kippercat?

Well, here he is:

:: -- JRH 5/16/2003 10:05:15 PM [+] ::
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:: Wednesday, May 14, 2003 ::

:: posted by John ::

The “Other” Voice… and, no, I am not a Cat Either

I am an American, as well. On one side of my family, we have been in Texas since before the Civil War; on the other we arrived just before the 1st World War. It would be accurate to say that my “roots” are very mixed; I was born in Texas as was my mother and her family for many generations. My father is from Ohio via Illinois & Indiana and his parentage goes directly into Russia, the Ukraine and Germany… and obscurity. I am married, no kids and serve time daily to earn a paycheck Monday – Friday. Politically, I am independent and at odds with both political parties now and for some time in the past. As best I can recall, the last major party candidate I voted for was Gerald Ford when he ran. Politically you can think of me as a mix of “reformed” anarchist (in its true rather than misused definition), conservative (think British Tory) and liberal (think German Social Democrat).

My self-definitions must encompass my lust for European History and political theory. Both passions have to considerable degree, shaped how I view my world and those I share it with. I have a passionate love of my country that in no way limits my ability to be critical of either its politicians or the electorate of which I am a part. In matters of foreign policy, I fall much more into the schools shaped by Machiavelli, Bismarck and Henry Kissinger.

In this day and time, it is probably also important to mention that I am a “self- confessed” tree-hugger. From time to time, I will no doubt pontificate on the subject. In my own defense, anything that I advocate I either do or would willingly embrace. I will endeavor to avoid preaching and only offer observations and/or changes that hurt neither the environment or the rest of us.

Economics, as a theory, I only know in derivative form via history and political science. I have not decided if I am a whole-hearted supply-side person or not; the “jury” is still out. I am comfortable with “capitalism” while having personal issues with my own employer… this too will no doubt crop up from time to time.

Feet of clay… I am, yet, not a Cat!

:: -- John 5/14/2003 09:45:57 PM [+] ::
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:: Tuesday, May 13, 2003 ::

:: posted by JRH ::

Libertarian?

Some have said my post on Liberty and Responsibility sounds distinctly libertarian. I don't know if I'm libertarian or not, but this post on Vinod's Blog makes a lot of sense to me.

Liberty without responsibility is license, even tending to licentiousness. A society is built on social contracts, not just individual ones.

:: -- JRH 5/13/2003 12:34:16 AM [+] ::
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:: Saturday, May 10, 2003 ::

:: posted by JRH ::

What Next? A Salt Weapon?

Jacob Sullum has a good column on some of the idiotic tactics used by the gun control lobby.

:: -- JRH 5/10/2003 10:56:11 PM [+] ::
...

:: posted by JRH ::

Confirmation Wars

You really should read this posting regarding the current confirmation filibuster in the Senate.

Update :: 5/13/2003 3:12 AM ::

Another view from Terry Eastland and an idea from Bill Frist in the Dallas Morning News.

:: -- JRH 5/10/2003 10:21:42 PM [+] ::
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:: posted by JRH ::

Where are the (hockey) stars?

In the Dallas Morning News (5/10/2003) hockey writer Tim Cowlishaw asks, "...where are stars?" He posits that the absence of star players in the Stanley Cup playoff games is a disaster for the NHL playoff ratings and goes on to say that the NHL needs to open up the offense to attract viewers.

Where are the stars? On ESPN and ABC, they think they are in the booth talking about anything but the game. It's like they are saying, "hockey is so hard to follow, the fans must tune in to hear us talk." No, not really. As a fan, I want to see the game on the ice, and I want to hear about the game that is on the ice, not the game that the broadcasters think should be on the ice or might have been on the ice, or whatever.

Cowlishaw does have a point about the game needing more scoring from the star players. As he said to me in an email:

They need more genuine scoring chances from great players (Modano, etc.) being allowed to skate and stickhandle. The only way to score goals today with goalies looking as if they weight 350 pounds is to throw it at the net and hope it hits off something. Ugly goals.

Anaheim's Jean-Sebastien Giguere is listed as 6'0" 185, Dallas' Marty Turco is listed as 5'11" 183, but in net they look more like Shaquiel O'Neal and Nick Van Exel. If Jiggy is wearing legal equipment, either Marty needs a new equipment contract or the rules do need to change. Actually, Marty's more athletic style may require lighter, smaller or less restrictive equipment than Jiggy's positional style, but even Patrick Roy and Ed Belfour don't wear pads quite like that.

More offense isn't the key to improving the sport, more excitement is. More real scoring chances would help but scoring alone won't do it. Seeing the puck stop in the net isn't very exciting if you don't know how it got there and after the puck stops, all goals look pretty much the same so 1 or 10, the excitement is the same. A 1-0 game can be a lot more exciting and interesting to watch than an 11-10 game and certainly more exciting than a 10-1 game. In the NHL all star game, you know they are going to score, the only question is how much. But it is only exciting if you can see it and know how it happens. In a low scoring game, excitement comes from the suspense of not knowing who is going to score first (if at all). It is a different kind of excitement, but no less thrilling to watch.

If the NHL wants to attract more TV viewers, it needs to present a product that is attractive to viewers. Hockey is not the easiest sport to watch on TV. The puck is small and travelling at high speed. And compared to other sports, so are the players. The result is action that is hard to follow.

I never watched hockey until 1998 when I was fortunate to see two games at the Corel Centre as a guest of Corel Corp. while on a business trip to Ottawa. The game is much more visible live than on TV because you can see the whole rink and once you understand the game (and there is nothing like watching your first game with a bunch of Canadians to help understand the game), you can "read" the ice and anticipate the puck. It make the action so much easier to follow.

Hockey on TV suffers from two things: Static, "traditional" camera placements, and broadcasters that often seem more interested in discussing NHL news around the league and their own careers than what is happening on the ice.

Camera placement in hockey mimic the placement in football and basketball. Both are slower sports. Football is not continuous action so there is more time for instant replay. Basketball, like hockey, is continuous action, but the ball is much bigger than the puck, doesn't move nearly as fast and is thus easier to follow. Some serious consideration needs to be given to creative camera placement. Overhead would be good. Modern technology allows split-screen broadcasts and a three screen arrangement of overhead view of the rink on one side with one camera following the puck and one focused on the goalie on the other might be something worth considering even though it would be most effective on large screen HDTV.

The broadcasters are another matter. Their role should be to tell the viewer what is happening on the ice. The NHL should hire Dallas Stars broadcasters Ralph Strangis and Darrel Reagh as consultants to develop and train all hockey broadcasters. The fact that Ralph and "Razor" simulcast TV and radio makes their games calls much more effective. They describe the action. The viewer knows what is going on and why. Technology could help here as well. I have found that the radio broadcast often runs 3-7 seconds ahead of the TV broadcast. As a result, I turn down the TV and listen to the radio. I get the same call, but since it comes ahead of the play, I know what is about to happen rather than what just happened. It makes a big difference. Perhaps the NHL should require 5 second video delay in all broadcasts. That alone would make the action easier to follow. And if the action is easier to follow, there will be more fans to follow it.

:: -- JRH 5/10/2003 03:37:05 PM [+] ::
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:: Wednesday, May 07, 2003 ::

:: posted by JRH ::

The iLoo?

Microsoft is developing a portable toilet with web access. The story also says MSFT is negotiating for the manufacture of toilet paper imprinted with web addresses the user may not have visited. Any guesses what addresses will be on the MS TP? Probably sites for Apple, IBM, Linux, Sun, and Corel. BIlly G. would enjoy wiping his butt with those.

OK, so Microsoft says it's a hoax even though MS reps in the UK also say it is real. Apparently they weren't supposed to say anything until Redmond was ready and until Redmond is ready to say so, the iLoo idea isn't real even if it is. Well, at least we know where Baghdad Bob is working now.

:: -- JRH 5/07/2003 01:16:25 PM [+] ::
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:: Monday, May 05, 2003 ::

:: posted by John ::

Where are We Going?
(and why in such a hurry?)

I commute. Two days a week, I drive the fifty-six miles (round trip) and the balance of the week I take the light rail and train. Driving takes me an average of fifty minutes; the light rail/train an average of two hours. So, why am I taking the train when driving is so clearly faster?

Time.

I don’t have a lot and more and more parts of my life seem to be asking for more and more time. My employer wants more, my wife deserves more and I want more for time with my friends and family. Where does it go? To work, work and back home. So, why do I sacrifice two hours in-transit vs. fifty minutes? Because its my time. While I am on the train and light rail, I don’t have to answer the phone, I don’t have to run an errand, I don’t have to be polite to a customer or co-worker. Mostly I read; a luxury that I treasure and now have time to indulge.

When I drive, I am in a nine year old, under-powered pick up truck. My truck and I are a lot alike, really. We both have a lot of miles on us, but we can still get from here to there; just don’t ask us to go to fast. Everyone around me is in a hurry. The speed limit is sixty for most of my route; I normally try to cruise at sixty-five. I might as well be parked. People not only pass me, and quite fast; they always give me “the look”. You know the one; it says “why are you so slow, and why are you in my way?”. It comes from housewives, business people, young, old and truly irrespective of ethnic persuasion, country of origin, or gender. I have been “flipped off” by folks in the latest, luxury model and the older more humble vehicles. And all the while, I cannot help but ask; where are they going in such a hurry? Work?

I don’t know about you, but for me it is just another four letter word; something I do that helps me afford the hobbies I like and keep food on the table and a roof over my head. Years ago, it was interesting and challenging; now it is just “work”. Based on the miniscule sampling of the populace I encounter everyday, I can’t help but feel that a lot of other folks feel the same way. So, where are they going in such a hurry and why are they so anxious to get there? My boss is reconciled to the foreknowledge that I will show up sometime between “early” and fifteen minutes late. He could discipline me, or even fire me; but since I bring many years of experience to the workplace he is tolerant of my less than perfect record on showing up on time. Do all these people that keep racing past me really feel the need to be at work so urgently that not only the speed limit is ignored, but so

It doesn’t go away on the weekend. Soccer practice, T-Ball, ballet, errands; you name it and a bunch of people are racing around trying to get it done. And, I wonder; how much time have you spent with your kids that did not involve running from one practice to game to mall? And, yes, they are still in back of me honking and making really creative gestures (well, not really creative--most pre-date my own now long ago childhood by many years… maybe enthusiastic would be a better description).

What would happen if we just slowed down… a little?

:: Comment by Jim Hart 5/7/2003 1:53 AM ::

What would happen if we just slowed down? That's simple: Someone else would get ahead!

People may not like to work (it's not supposed to be fun, that's why they call it work) but like you, they do it to get the things they need and want. And they are competing with each other for the jobs and for the things those jobs provide. Competing means getting ahead. I think it's called the Rat Race.

What you are actually suggesting is not that everyone just slow down, but that everyone voluntarily reduce their expectations, lower their goals, cut back on their desires, narrow their horizons--that everyone somehow just want or need less so that they would not need to do as much to get it. I don't think that's gonna happen on a broad scale. On an individual basis, it's another matter. People drop out of the race all the time. You see them standing on street corners with cardboard signs, but even a lot of them are just running the race at a different speed.

The best thing to do is run the race at the pace most comfortable for you and let others do the same. If you don't need to get out in front, get out of the way those that think they do. IOW, stay out of the fast lane, get off the freeway and take the side streets. Or ride the light rail and use the time for other things.

:: Update by John Hitz 5/7/2003 8:45 pM ::

Where Are We Going… Reprise

Competition is a good thing; it allows us to “measure” ourselves against others and is often the motivation that pushes beyond our normal expectations. Chasing around, flat out in a combined pursuit of work and a perceived quality of life is quite another. I have no issue with those that chose to rush; rather I use part of my time to reflect on what I see and they don’t. I see a relentless pursuit of things, without too much reflection involved. People buy cars that go over a hundred miles an hour, but cannot be (legally) driven faster the seventy-five anywhere in the United States. They buy boats that sit for months because there is never any time to put them in the water to enjoy them. They farm their kids out to learn teamwork in sports and group activities and then bemoan the fact that they never think for themselves. The cannot understand why their kids do so poorly in school, but are sure that there are enough television sets and/or video games in the house to keep them entertained.

No. I will not delay those that pass me for a moment. My reflections are mostly on what they have chosen to abandon in pursuit of their goals. I do my best to stay out of their way – we each make choices, and I am trying my best to make those choices consciously and of my own volition. Like most human endeavors, there is still a lot of room for improvement.

Finally, rather than say that I feel that those around me should lower their expectations; it would be more accurate to say I feel they should assess what their expectations are and if they are on the right road to get there. My impression is that most people are so busy racing from job to chore to obligation to bed to grave that they rarely slow down long enough to determine just where they are going much less why.

So, rest assured. I will slow no one up if I can help it. And I will be sincere in my hope that they know where they are going and will recognize it when they get there.

:: -- John 5/05/2003 09:12:30 PM [+] ::
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