Politics, culture, business, and technology

I also blog at ChicagoBoyz.

Selected Posts:
Dancing for the Boa Constrictor
Koestler on Nuance
A Look into the Abyss
Hospital Automation
Made in America
Politicians Behaving Badly
Critics and Doers
Foundations of Bigotry?
Bonhoeffer and Iraq
Misvaluing Manufacturing
Journalism's Nuremberg?
No Steak for You!
An Academic Bubble?
Repent Now
Enemies of Civilization
Molly & the Media
Misquantifying Terrorism
Education or Indoctrination?
Dark Satanic Mills
Political Violence Superheated 'steem
PC and Pearl Harbor
Veterans' Day Musings
Arming Airline Pilots
Pups for Peace
Baghdad on the Rhine

Book Reviews:
Forging a Rebel
The Logic of Failure
The Innovator's Solution
They Made America

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a schoolyard blog
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lead and gold
damian penny
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Sunday, July 31, 2005  

Business 2.0 has an article in the July issue under the title The CEO's Secret Handbook. Once you get past the over-dramatic title, there are some sound thoughts in the piece.

Bill Swanson, who became CEO of Raytheon in 2003, had for a long time been writing down his thoughts on the art of management. He turned his note collection into a presentation and then to a 76-page booklet--Swanson's Unwritten Rules of Management--that he handed out to Raytheon's 300 top managers. Finally, a private printing was done for distribution to executives outside the company. Jack Welch and Warren Buffett, along with several others, have praised the work.

Here are 4 of the "rules" that I think are particularly good.

Look for what is missing. Many know how to improve what's there; few can see what isn't there.

This is one of my favorites. It hit me in the middle of the night. It isn't an obvious lesson; it only came to me later in my career. When people look at a design or a problem, they're good at refining the details -- it's human nature to focus on what's in a presentation. But sometimes what isn't there is even more important. This idea becomes especially critical as you take on more responsibility, because it speaks to the importance of strategic thinking.

A person who is nice to you but rude to the waiter -- or to others -- is not a nice person. (This rule never fails.)

Watch out for those with situational value systems -- people who turn the charm on and off depending on the status of the person with whom they're interacting. Those people may be good actors, but they don't become good leaders. There's a consistency in leadership that's greater than mere situational awareness. I was reminded of this recently while dining at a high-end restaurant with several other CEOs. One guy's meal didn't come out right, and he decided to take the waiter down a peg or two. The poor server didn't prepare the food -- he simply carried it from the kitchen! I looked across the table and thought, "What the hell is this guy trying to prove?" He was trying to show who was in charge, but really he was just being an ass.

When facing issues or problems that are becoming drawn out, "short them to ground."

This metaphor comes out of my engineering training. "Shorting issues to ground" means finding the quickest path from problem to solution. If you sense that your organization is spending more time on the bureaucracy of problem-solving than on actually solving problems, it's time to simplify the process. This came up when my division was developing the Patriot air defense system in the 1980s. We were having problems with the radar, and there were lots of meetings and reports but no solutions. I shorted the issue to ground by going down to the shop floor and talking to the people who had soldering irons and circuit boards in their hands. In the end we were able to eliminate weeks from the product's test cycle.

You remember 1/3 of what you read, 1/2 of what people tell you, but 100 percent of what you feel.

If a parent tells a young child not to touch a lightbulb, the child generally won't remember. But after the first time he touches a lightbulb, he'll never forget that it's hot. A leader needs to communicate in a way that makes people feel what they need to do. I was reminded of this a couple of years ago during a visit to Nellis Air Force Base. I introduced myself to a pilot, and he looked me in the eye and said, "If it wasn't for what you all do, I wouldn't be here today." A missile had been launched at his F-15, but we make a decoy, which he deployed. The decoy didn't come home -- but he did, to his family. I use that feeling to remind everyone that people's lives depend on the reliability of our products.

12:04 PM

Saturday, July 30, 2005  

A videogame developer decided to outsource the artwork for one of its games to Rumania. The game involved some kind of battles between humans and lions, among other things.

When the art came back, the lions were so beautiful that players could not bring themselves to shoot them. The artists had to be instructed to do it again and produce some lions that looked meaner and less elegant this time.

(I saw this item somewhere yesterday, I believe in a print publication--now I can't find it. If it turns up again, I'll add a link or reference.)

UPDATE: Found it...it's in the "Fortune Small Business" section of the August 8 issue of Fortune. As near as I can tell, it's not on-line.

Some other interesting stuff in the section, which is a special report on the issues involved in offshoring. In 2004, average programmer salaries in India rose 11%, vs 2% in the U.S. in the same year. And "office rents in Bangalore now rival those in mny midsized American cities." Things are getting expensive enough in India that one American entrepreneur (who is himself of Indian extraction) decided to develop a new product (software plus hardware) in Fremont, California rather than in India as he had done for some earlier products...the total cost was $500,000, whereas he estimates that it would have cost him $1.5 million to do it in Bangalore. Factors involved in the cost comparison included additional management and travel costs if the work had been done in India; also higher staff attrition rates in India (apparently there is a lot of job-hopping going on right now as people chase opportunity.) Of course, a larger project would allow the management overhead to be amortized over a larger base; also a substantial and well-managed local operation should in principle be able to cut down on the attrition...still, it's an intersting example.

9:15 AM

Friday, July 29, 2005  

The Blog Mela is up. It's a collection of posts from the Indian blogosphere, and this edition is truly a thing of beauty.

8:11 PM

WHAT IF....?

Here's another good discussion on education. Jenny D wants to know: If you ran a school...and had as much money as you needed...what would you do to improve things?

8:05 PM


A major movie about 9/11 is being planned, and the director is...Oliver Stone. Recently, Stone had this to say:

There was an over-reaction after 9/11. Bush was given enormous powers and misused them. He created a war in Iraq that has further helped bust the economy, and has led to civil war there.

He was the wrong leader at the wrong time. I always felt that. I wish I was wrong,

To which Roger Simon, who is himself in the movie business, responds:

This is, of course, BS. Stone doesn't wish he was (or were) wrong. He wishes he was right. He wants the country to have made the wrong step in his view so that he can remain what he thinks is cutting edge. Oliver Stone NOT in opposition to a president is not Oliver Stone. He is just some guy who recently made a bunch of movies that tanked - in other words, anonymous. Never mind all those millions of real live Iraqis waving their purple fingers in support of democracy. We won't talk about them - and certainly Oliver won't.

When Roger slams somebody, he does a good job of it.

11:45 AM

Thursday, July 28, 2005  

Betsy has some thoughts, which have spawned a very lively discussion.

3:26 PM

Saturday, July 23, 2005  

People who talk frequently are more likely to be judged by others as influential and important--they're considered leaders.

The above conclusion was drawn from research by business professors Jeffrey Pfeffer and Robert Sutton, as quoted in the book Why Great Leaders Don't Take "Yes" for an Answer, by Michael Roberto of Harvard Business School. Roberto expands on the results:

At first glance, that finding may not alarm you. Leaders do need the ability to articulate their ideas in a concise and persuasive way in public settings. However, Pferrer and Sutton have also discovered that "smart-talk" tends to be overly negative and complex. When people strive to impress others in meetings, they tend to explain how and why a proposal will not work rather than describing why it might succeed. (Based on their research) Pfeffer and Sutton argue that an individual is more likely to bolster others' perceptions of his intelligence by offering critiques rather than positive pronouncements about proposals and ideas under consideration. They find that many organizations encourage "the tendency to tear an idea down without offering anything to put in its place." Smart talk becomes an impediment to open, constructive dialogue and an obstacle that prevents firms from moving from analysis to action.

Pfeffer & Sutton observe that the smart-talk tendency is encouraged by many MBA programs, where critiques are encouraged and where there is no need to actually implement one's thoughts and analyses. But the smart-talk phenomenon appears in non-business environments as well as business ones. The researchers cite a study by Teresa Amabile, who found that book reviewers offering negative opinions tended to be perceived as more intelligent than those offering positive evaluations.

I think the phenomenon they describe is a real and serious one, and is something to which leaders in all types of organizations should be alert.

See my story about how one very fine executive tried to deal with an incident of "smart talk," here.

12:20 PM


Only two weeks after the terror attacks against his city, London Lord Mayor Ken Livingstone speaks out--to denounce Israel and to offer sentiments of understanding toward Palestinian terrorists:

Given that the Palestinians don't have jet fighters, they only have their bodies to use as weapons. In that unfair balance, that's what people use. When talking about the imbalance of forces, I will gladly welcome leading members of the Israeli government if they come here even though they have done horrendous things which border on crimes against humanity in a way they have indiscriminately slaughtered men, women and children in the West Bank and Gaza for decades.

Of course, Israel has not used its jet fighters and other advanced weapons on an "indiscriminate" basis--there have been no bombing raids against schools and shopping malls, whereas there have been plenty of terrorist attacks against such facilities. But that doesn't stop Livingstone--who has been dubbed "red Ken" for his leftist political views--from continuing with his moral equivalence:

I think the Israeli hardliners around Likud and Hamas are two sides of the same coin, they need each other to drum up support.

(See Melanie Phillipsfor more of Livingstone's nonsense, and for an incisive fisking thereof.)

Livingstone's remarks shouldn't be surprising to anyone who follows politics in depth. For two decades, many "progressives" have painted terrorists as positive, even romantic figures--as long as the victims of the terrorists have been limited to members of groups demonized by these "progressives" (mainly Israelis and American military personnel). The only surprise is that Livingstone dares to continue with this thread so very soon after the London attacks.

There's an old science fiction story about a group of robots that were built for warfare. They were programmed to "kill the men in yellow uniforms"--but they generalized the command to "kill the men" and eventually wiped out the human race.

Just like the killer instinct of the robots would not be limited to only the designated enemies, the taste for blood developed by terrorists will not be sated by the blood only of Israelis and of American soldiers--regardless of the intentions of the Western enablers of those terrorists.

Victor Davis Hanson writes:

First the terrorists of the Middle East went after the Israelis. From 1967 we witnessed 40 years of bombers, child murdering, airline hijacking, suicide murdering, and gratuitous shooting. We in the West usually cried crocodile tears, and then came up with all sorts of reasons to allow such Middle Eastern killers a pass.

Yasser Arafat, replete with holster and rants at the U.N., had become a “moderate” and was thus free to steal millions of his good-behavior money. If Hamas got European cash, it would become reasonable, ostracize its “military wing,” and cease its lynching and vigilantism.

When some tried to explain that Wars 1-3 (1947, 1956, 1967) had nothing to do with the West Bank, such bothersome details fell on deaf ears.

When it was pointed out that Germans were not blowing up Poles to get back lost parts of East Prussia nor were Tibetans sending suicide bombers into Chinese cities to recover their country, such analogies were caricatured.

Read the whole thing: And Then They Came After Us

11:49 AM

Thursday, July 21, 2005  

A few days ago, I wrote about The Dallas Morning News, which has decided to call terrorists by their name, rather than using euphemisms like "militant" or "fighter." Unfortunately, that attitude seems to represent a distinct minority among the mainstream media.

Here, for example, is a memo on terminology distributed by the Canadian Broadcasting Company to its employees. Extract:

Terrorism generally implies attacks against unarmed civilians for political, religious or some other ideological reason. But it's a highly controversial term that can leave journalists taking sides in a conflict.

By restricting ourselves to neutral language, we aren't faced with the problem of calling one incident a "terrorist act" (e.g., the destruction of the World Trade Center) while classifying another as, say, a mere "bombing" (e.g., the destruction of a crowded shopping mall in the Middle East).

Here's an idea: Why not refer to both of the above acts as "terrorist acts?" Isn't that what most normal people would call them? Yeah, even if the crowded shopping mall is in Israel (or Iraq).

Read the whole depressing thing. I wonder how today's CBC would have reported WWII. Would they have refused to call Nazi Germany "the enemy" on the grounds that "enemy" is a controversial and judgmental term?

Click here for yet another example of media moral equivalency. In this one, a news service seems to think that gun battles involving Hamas are the equivalent of loud but peaceful protest demonstrations in Israel.

UPDATE: Read what Roger Simon has to say about the state of the mainstream media.

2:19 PM

Tuesday, July 19, 2005  

Chicago Girl Ginny has a very interesting essay about...well, I'm not sure I can describe what it is about in a way that does it justice. Just read it.

7:21 PM


...and actual customer loyalty. Rob has some thoughts, and a good discussion in the comments.

2:55 PM


The Cotillion Ball is a collection of posts by women who blog...mostly from a rightish or libertarian perspective. Unlike most web carnivals, it has multiple hosts (hostesses in this case)...you can start with Girl on the Right and follow the links to the other three, and thence to the posts themselves.

And Carnival of the Capitalists is up as well.

UPDATE: See also Carnival of the Liberated, which features Afghan and Iraqi bloggers.

6:38 AM

Sunday, July 17, 2005  

Betsy Newmark, a blogger to whom I often link, is on the cover of the Washington Post magazine section today, along with liberal blogger Barbara O'Brien. Writer David Von Drehle thought it would be interesting to bring both women to Washington, take them around to see the sights, and listen to them talk about things. They didn't agree about much: About the only point of agreement was that it is good for high school students to be involved in debate teams.

Definitely worth reading.

Not only is Betsy a notable blogger in her own right: she has a blogging family. Her husband Craig, an economist, publishes Newmark's Door, while daughter Katie runs A Constrained Vision--both very worthwhile blogs.

9:09 AM

Saturday, July 16, 2005  

Like many denizens of the blogosphere, I have serious concerns about the recent Supreme Court decision on eminent domain. I see several malign consequences flowing from the expansion of eminent domain powers beyond a very narrow scope. First, there is the injustice done to the individuals whose property is seized. Second, there is the misdirection of economic resources, as economic decision-making about the use of property is taken out of the hands of the marketplace and given to state and local governments who will often use this power--however good their intentions--in a manner which proves to be destructive (read about the example of Pittsburgh, here). And finally, there is a probable increase in corrupt behaviour on the part both of government officials and of the businesspeople who will become increasingly dependent on the decisions of these officials.

The coverage of this issue by the mainstream media has not, for the most part, been very astute. The Washington Post, in referring to the New London case (the specific case on which the Supreme Court was asked to rule) said:

The trouble is that there is no good way to distinguish New London’s use of eminent domain from assertions of the power that local governments depend on all the time for worthy projects. Railroads, stadiums, inner-city redevelopment plans and land reform efforts all have involved taking land from one owner for the apparently private use of another.

Is the Post really unable to understand the relevant differences between a railroad, a stadium, and a shopping center? Railroads, like highways and power lines, require long, narrow, and continuously-connected strips of land. Moreover, they are--again, like highways and power lines--vital infrastructure. Take away the railroads of America, and Washington Post editorial writers will soon, like everybody else, get very hungry. Stadiums and shopping centers are something else entirely.

The New York Times, in its editorial on the court decision, said:

The Supreme Court's ruling yesterday that the economically troubled city of New London, Conn, can use its power of eminent domain to spur development was a welcome vindication of cities' ability to act in the public interest.

Ah, "public interest," that favorite phrase of liberals. Isn't it interesting, though, how the "public interest," as determined by local politicians, tends to match up with the interests of those who are already wealthy and powerful rather than the interests of those who are not? Liberals seem to have an extraordinarily difficult time grasping this reality. And, even when the motivations of the local politicians are pure, there is little evidence that they have any real talent for "economic development." These projects tend toward the grandiose and flashy, rather than toward the practical, and often do more harm than good (see Pittsburgh example above.)

Among the responses to the Court decision, one is particularly noteworthy--that of the House Democratic Minority Leader, Nancy Pelosi. After the decision, there were discusions about passing a federal law to ban eminent domain takings on federal property for private benefit and to ban federal money for state and local takings for private benefit. Responding to this proposal, Pelosi said:

Again, without focusing on the actual decision, just to say that when you withhold funds from enforcing a decision of the Supreme Court you are, in fact, nullifying a decision of the Supreme Court. This is in violation of the respect for separation of church -- powers in our Constitution, church and state as well.

Of course, nobody was talking about withholding funds from enforcement. There is no separation of powers issue here. Congress has a perfect right to make rules about the use of eminent domain on federal property, and it has a perfect right to withhold money for projects involving what it feels to be inappropriate use of eminent domain.

Asked what she thought about the merits of the decision, Pelosi said:

It is a decision of the Supreme Court. If Congress wants to change it, it will require legislation of a level of a constitutional amendment. So this is almost as if God has spoken. It's an elementary discussion now. They have made the decision.

Betsy Newmark, a history and civics teacher, responds to Pelosi's comments:

Where to start?

The Supreme Court in the majority decision even encouraged states to pass laws that protected private property from such takings. The federal government has the right to pass such laws. It would not be nullifying the decision. It is not that the Court said that takings for private benefit were a Constitutional right; it was just that the 5th Amendment didn't forbid it. There is a big difference. Think about another example. There is no federal shield law for journalists. That is why the Supreme Court didn't hear the case of Judith Miller and Matthew Cooper. If the Congress now decided to pass a federal shield law, would Nancy Pelosi then say that that was an inappropriate flouting of a Supreme Court decision? Of course not.


Also, the federal government has all sorts of mandates that they attach to federal grants. Think equal employment provisions and environmental regulations. They can even require states to raise their drinking age for minors to get federal transportation money. So, there is nothing strange about them tacking on yet another requirement for federal grants for federal community development block grants to keep that money from being used in any local project that involves taking private property to benefit a private entity. I guess the mandates that expand federal power are correct in her eyes, just not the ones that limit it.

Pelosi seems to have little understanding of how government in this country is actually supposed to work. Perhaps she should spend some time in Raleigh, North Carolina, attending Ms Newmark's 8th grade history and civics class.

Annika also has thoughts on Pelosi's response to the eminent domain decision. In the comments at Annika's site, one person said: "Until seeing Pelosi, I thought California could never elect a politician with a lower IQ than Boxer." My first thought was that he had made a typo; that he really mean to say "a politician with a lower IQ than a boxer," referring to the breed of dog. (With apologies to all boxers and their human friends.)

(I should also mention a contrary point of view on the Supreme Court eminent domain decision: John Hinderaker, of the PowerLine blog, argues in The Daily Standard that the decision "wasn't so bad after all"--that it merely maintained the legal status quo on this issue, which John evidently feels is by and large a reasonable one. Read what he has to say: Agree or disagree, it's a much more reasoned analysis than anything you're likely to read in the editorial pages of the Washington Post or The New York Times, and certainly much more reasoned than anything you're likely to hear from the likes of Nancy Pelosi.)

9:28 AM


From The Dallas Morning News:

No longer will we refer to suicide bombers or anyone else in Iraq who targets and kills children and other innocent civilians as “insurgents.”

The notion that these murderers in any way are nobly rising up against a sitting government in a principled fight for freedom has become, on its face, absurd. If they ever held a moral high ground, they sacrificed it weeks ago, when they turned their focus from U.S. troops to Iraqi men, women and now children going about their daily lives.

They drove that point home with chilling clarity Wednesday in a poor Shiite neighborhood. As children crowded around U.S. soldiers handing out candy and toys in a gesture of good will, a bomb-laden SUV rolled up and exploded.

These children were not collateral damage. They were targets.

The SUV driver was no insurgent. He was a terrorist.

People who set off bombs on London trains are not insurgents. We would never think of calling them anything other than what they are – terrorists.

Train bombers in Madrid? Terrorists.

Chechen rebels who take over a Russian school and execute children? Terrorists.

Teenagers who strap bombs to their chests and detonate them in an Israeli cafe? Terrorists.

IRA killers? Basque separatist killers? Hotel bombers in Bali? Terrorists all.

Words have meanings. Whether too timid, sensitive or “open-minded,” we’ve resisted drawing a direct line between homicidal bombers everywhere else in the world and the ones who blow up Iraqi civilians or behead aid workers.

No more. To call them “insurgents” insults every legitimate insurgency in modern history. They are terrorists.

(via LGF)

9:06 AM

Friday, July 15, 2005  

How much competition is too much?

I asked myself that question some years ago when I was appointed director of curriculum and instruction for a Midwestern city school district. Making the rounds of the district’s 12 schools I found competition everywhere.

..and didn't approve of it, evidently:

When I counted up the number of competitive activities in classrooms -- more than 200 in one school year -- I knew it was time to put on the brakes. It wasn’t easy, but with the school board’s support and principals’ cooperation, we reclaimed the instructional program. Competitive activities were still allowed, but they were held after school for students who wanted to sign up.

Summary and discussion at Joanne's; article here.

12:53 PM

Wednesday, July 13, 2005  

Sarah Boxer, who writes for The New York Times, doesn't much like the website We're Not Afraid, to which I referred in the post below. Among her comments:

The site displays a range of defiant postures. Some people hold up their middle fingers, presumably for the terrorists to see. Some people posted pictures of American soldiers, presumably for Londoners and Americans to see.

But more and more, there's a brutish flaunting of wealth and leisure.

Look at some of the pictures on the site, and see if one of the main things you get from it is "a brutish flaunting of wealth and leisure." I certainly don't.

And, unbelievably, Boxer also says:

We're Not Afraid, set up to show solidarity with London, seems to be turning into a place where the haves of the world can show that they're not afraid of the have-nots.

Who, other than Boxer, thinks that the message "we are not afraid" is directed at have-nots? To most of us, it would seem clear that it is directed at terrorists.

It seems to me that anyone who would respond to We're Not Afraid as Boxer did must have a very strange worldview indeed--but not an uncommon one, I suspect, among those who write and edit The New York Times.

UPDATE: I thought I remembered the name "Sarah Boxer" from somewhere...check this out.

12:59 PM


...on the terrorist attacks in London.

Muslims in Bahrain speak out against terrorism


A message to the terrorists from people around the world

(Just click on one of the "galleries"--the individual images are clickable/expandable)

7:58 AM

Monday, July 11, 2005  

Two days after the terrorist bombings in London, Tony Blair gave an interview to the BBC. It was reported in an AP article which included the following words:

"I think this type of terrorism has very deep roots," Blair said. "As well as dealing with the consequences of this - trying to protect ourselves as much as any civil society can - you have to try to pull it up by its roots."

That meant boosting understanding between people of different religions, helping people in the Middle East see a path to democracy and easing the conflict between Israel and the Palestinians, he said.

In Israel, the idea that the bombings were in some way caused by the Israeli-Palestinian conflict was not well-received.

It turns out, though, that Tony Blair never said it. British readers of the website Honest Reporting revealed that AP had reported Blair's words in a misleading fashion. What Blair actually said is that 'some of the critical issues in the Middle East' need to be 'dealt with and sorted out'. AP editorialized Blair's vague statement to mean the Israeli-Palestinian conflict.

After being called on their mistake, AP issued a correction:

In a July 9 story about Prime Minister Tony Blair's comments on overcoming global terrorism, The Associated Press erroneously reported that he spoke of easing the conflict between Israel and the Palestinians. Blair did not specifically mention the Israeli-Palestinian conflict in his interview with the British Broadcasting Corp.

And Honest Reporting says: Kudos to media monitors for eliciting the correction, but two questions remain: At what point in the editorial chain did AP filter Blair's words, artificially introducing Israel as one of Blair's 'root sources' of Islamist terror? And what is being done at AP ? the world's largest wire agency ? to rectify this apparent anti-Israel bias, and the misrepresentation of UK policy?

Maybe one would be better off reading the Weekly World News instead of AP stories. At least you get bat-boy!

(via Meryl Yourish)

3:59 PM

Sunday, July 10, 2005  

BusinessWeek (4/18) has an interesting article about GM and specifically about Bob Lutz's efforts to improve the design of GM cars. The article talks about some traditional GM practices which have had malign effects:

The Chevy Malibu typifies the problem. When the car was developed, GM had strict rules on how much it was willing to spend for the big steel stamping dies that press the doors and body panels. Since engineers and accountants wanted the car to be easy and cheap to build -- and GM prioritized roominess over style -- the Malibu ended up being a slab-sided box.

I find it kind of unbelievable that GM had "strict rules" on how much could be spent on the stamping dies. Obviously, the cost of the dies has to be reasonable in the context of the financials of the overall model. But tradeoffs should be possible. Maybe for a particular model, it would make sense to spend more for the dies and less for something else. Or maybe the cost of the dies could be justified by better styling, resulting in a higher average price and margin. What matters is the total rate of return on the model, including all positive and negative cash flows over time. Product line executives should be empowered to make whatever tradeoffs they think best in optimizing model revenue and profitability, and then held accountable for actual results. The idea that all these things can be predefined in a giant procedures manual is silly--indeed, it's like something one would expect to see in an American public school system or in the darker corners of a Federal bureaucracy.

Lutz and his associates seem to be working hard to take some of the rigidity out of the system; however, I'm not sure that they've yet drawn the necessary conclusions about the decentralization of power and responsibility. Indeed, in times of great stress, a normal human reaction is to centralize and overcontrol. I hope GM can avoid this temptation.

(see also Smart!)

9:40 AM


Cemex is a large Mexican cement company, which also has operations in many other countries, including the U.S. The company has set up a program called Construmex, targetted at Mexicans who are working in the U.S. and who want to build a house back in Mexico...for parents, for spouses and children still living in Mexico, and/or for their own eventual return to that country. The program allows them to purchase cement and other building materials without incurring the often-high fees charged by money transfer services. It also provides design and building advice.

A BusinessWeek article (7/18) tells the story of Ignacio Moreno (not his real name) and his family. Moreno works as a bakery employee in Chicago and contributes $380/month to his Construmex account.

Back in Mexico City, Moreno's mother, Alfreda Rosales, 55, stands proudly at her son's construction site. The former laundress shares a cramped room with her daughter and grandson as they await the completion of the 1,400-square-foot home. "Ignacio has always been a hard-working boy," she says, wiping away a tear. In a few years, Moreno plans to live in the new house with his family and mamá. Now he's thinking bigger -- a bakery of his own back home, a project he has already discussed with Construmex.

Seems to me that this is a program that is good for lots of people. It's good for Cemex shareholders (of whom I am one). It's good for the individuals involved. It's good for the Mexican economy. Some might argue that it's not good for the U.S. economy, because the funds transferred might otherwise stay in the U.S. and be spent with American businesses; however, I think that's a shortsighted view. A lot of the money would be transferred anyhow, but often used less effectively. And an economically-viable Mexico is certainly a vital interest of the U.S.

The Construmex program is still small: only 4500 participants so far--but it would seem to have a lot of potential. Cemex is a company which has shown a quirky kind of creativity in the past: In 1998, it introduced the improbable idea of bags of cement as wedding presents--an idea that has apparently been quite successful in Mexico. (According to the book Blue Ocean Strategy, as reviewed in BusinessWeek (4/4).

As always, nothing on this weblog should be considered as investment advice.

(see also Dumb!)

9:20 AM


A reporter for Britain's Television Four went undercover in some of the country's toughest schools. What she found wasn't pretty:

What struck me very early on was that poor, even outrageous indiscipline - children leaping across tables or wandering around brandishing fire extinguishers - had become acceptable. At one school, I was calmly advised by a female colleague to lock the classroom door while I was teaching, to "protect" myself and my class from the marauding groups in the corridors. The look of surprise on my face did not seem to register with her.

But when the school inspectors came around, they saw a very different picture: When Ofsted inspectors arrived the week after for a two-day visit, however, the school was suddenly transformed. I got through a whole lesson without incident, the corridors were mayhem-free, the atmosphere calmer.

How was this miraculous transformation achieved? It turns out that 20 of the most troublesome pupils had been sent on a "day trip." Also, managers and experienced teachers from other schools were brought in to teach classes that Her Majesty's Inspectors would be watching. Staff at 3 other schools told the reporter that "hiding" problem pupils during the inspections was a common practice.

This kind of manipulation seems highly comparable, on a moral level, to the fudging of financial results by certain corporate executives. In both cases, the objective is to hide what is really going on from stakeholders who have a right to know. Maybe the legal penalties should be equally draconian.

But the fakery, as bad as it is, isn't the worst of it. If administrators know how to make a school civilized for a day, why don't they use this knowledge to do it all the time, so that something can actually get learned? If there are 20 students who are making the school intolerable for everyone else, why not throw them out?

"Progressives" have created a climate in which this is impossible, claiming that to do so would be to write off those 20 children as hopeless. But in reality, if high standards of acceptable behavior were to be maintained, most of the troublemakers would straighten up and fly right. Out of the 20 "incorrigibles," I would bet that only 5 or so would wind up needing to be permanantly expelled.

But rather than face up to what needs to be done, administrators and their "progressive" allies would rather see a whole school in chaos and an environment in which no one learns anything, with terrible consequences for their entire lives. And, ironically, there is no benefit to the troublemakers, either. The only people who benefit are the "progressives," who can feel very good about themselves regardless of the destruction that they wreak.

(via Melanie Phillips)

See also: Penny in the Fusebox

8:54 AM

Thursday, July 07, 2005  

London was hit by a coordinated series of bomb blasts that have killed at least 40 people and injured 300.

Blogger Charmaine Yoest is in the U.K. to blog the G-8 summit. Her husband Jack passes along the following e-mail from Charmaine at the Edinburgh airport:

"Airport is packed with air passengers unable to leave – all flights are shut down. Uniformed men with machine guns grimly moving about. Stranded travelers with baggage starring up at television monitors, horrified at pictures from London. Alarms and sirens constantly going off echoing thru the Edinburgh airport. There is no panic, but there is shock – the same shock we saw in the faces of resident New Yorkers on 9.11 all over again. There is no word if more bombings are expected."

Wireless is down. Charmaine’s site is down. Charmaine is taking pictures; we may try to get something posted on our other site: www.Yoest.org

Charmaine and the media entourage were scheduled to fly to London today and out from London either tonight or tomorrow morning. There is no word when air travel will resume in the UK.
(via PowerLine)

The terrorist organization that claims responsibility for the bombings says "now Britain is burning with fear and terror, from north to south, east to west."

John Hinderocker of PowerLine responds: I suspect that at the moment there is not much fear and terror, but lots of rage and anger.

And Mindles H Dreck has some words for the people of the U.K. (Follow the link and see under what other historical circumstances this quote was used.)

UPDATE: Extensive and continuing coverage at The Command Post.

6:48 AM

Wednesday, July 06, 2005  

Here's an e-mail from a Kurdish man working as an interpreter with U.S. forces, sent to a friend who is an American soldier. This man has been the recipient of multiple death threats from the terrorists. Excerpt:

I can't have my normal life in Iraq again, but I will never stop fighting. And I will never allow these people to come to take over the government and allow them to kill my family and my tribe again. But in the other face to this situation, I'm happy because now I think I paid back the debts to Coalition Forces, and I have revenged my Kurdish people and I enjoined the forming of democracy in this country. And if I stay alive, I will tell my children that I was with great people, fighting side by side to stop the terrorists. And I will tell them the nice and sad stories about that.

Read the whole thing.

And here's an item about hundreds of Iraqis demonstrating against terrorism in Mosul. Participating in a demonstration like this in Iraq is not like participating in a typical campus demonstration in the U.S.--it requires considerable commitment and courage.

As Mudville Gazette points out, the mainstream media rarely manages to cover stories like this, but they always manage to cover things like the 200 people who demonstrated against President Bush during his visit to Copenhagen (a city of 1.7 million).

Does this kind of coverage pattern reflect partisan politican bias? Outright distaste for anything that might put the U.S. in a positive light? A journalistic preference for covering bad news? Or just a general laziness and incompetence reflected in an inability to develop new kinds of news sources rather than just doing the same old things?

Probably some of each, would be my guess.

3:48 PM


Unbelievable..the Checkpoint Charlie memorial in Berlin has been destroyed. Although the immediate villain in this matter is the bank that owns the property, the leftist city government of Berlin had a lot to do with the destruction: Protestors accused the authorities, many of them Social Democrats and former Communists, of not wanting to acknowledge the crimes of the former East German regime.

8:48 AM

Monday, July 04, 2005  

Roger remembers his visit to Ellis Island.

That omniverous reader Sheila has an extensive set of 4th-related posts up.

Everyone has heard Samuel Johnson's aphorism, "Patriotism is the last refuge of a scoundrel." However, I suspect that very few are familiar with some of the other things that he said about patriotism. For example:

Some claim a place in the list of patriots, by an acrimonious and unremitting opposition to the court. This mark is by no means infallible. Patriotism is not necessarily included in rebellion. A man may hate his king, yet not love his country.

(There is some evidence that the "scoundrel" to whom Johnson referred was none other than Edmund Burke. Wow!)

9:25 AM

Sunday, July 03, 2005  

An old issue of BusinessWeek (12/6/04) provides some interesting data on the effects of mergers on customer service. Surveys were conducted to measure customer perceptions of 28 companies that were involved in major mergers between 1997 and 2002. On the average, customers were significantly less satisfied even two years after deals closed than they were before the mergers.

For example, the Qwest acquisition of US West resulted in a 12.5% fall in the customer satisfaction index (compared with a 1.4% fall for the industry as a whole.) The First Union acquisition of Core States resulted in a 8.1% fall (compared with a 2.8% fall for the industry). Lots of other examples are given.

The study does show some cases where customer satisfaction improved after a merger: for example, Nestle's deal with Ralston Purina took satisfaction up by 3.7% (vs +1.2% for the industry). But these cases are a lot rarer than the other kind.

In statistical studies like this, of course, it's notoriously difficult to untangle cause and effect. It's possible that lots of other things were going on at the same time, in addition to the mergers, that had an impact on customer service. Still, these results should be carefully considered by anyone planning a merger or acquisition.

And these customer satifaction issues are not without real cost. Another study estimates that about one quarter of people with $1 million or more in investable assets get so upset that they take money out of their accounts soon after their bank mergers. I'm sure that banking isn't the only industry in which this kind of thing happens.

Obviously, there are things that can be done to reduce the likelihood of customer pain in the wake of a merger. However, it's all too easy to kid oneself that the situation is better in hand than it actually is. There are a lot of moving parts in organizations, and they aren't always visible until one get enmeshed in the details. Remember, four of the most dangerous words in the English language are "It's different this time."

In the pro-forma P&L statements that are used to assess the potential imact of mergers, there should be a line for the negative impact of customer defections. Maybe in certain cases that line should be zero, or even positive, but experience as described in this study seems to suggest that those cases are relatively rare--and, hence, such assumptions need to be justified and challenged. More often, there will indeed be a negative item for defections, partially offsetting (or maybe even wholly offsetting) any apparent synergies claimed for the merger.

None of which is to say that there aren't worthwhile mergers...but there are way too many of the other kind.

See also my post Synergy, or Just Syn? and also Diseconomies of Scale and Mergers, Acquistions, Princesses, and Toads.

11:33 AM

Saturday, July 02, 2005  

Referring to allegations that Iran's new President-elect was among those who held 52 American hostages in Teheran, NBC's Brian Williams said:

"What would it all matter if proven true? Someone brought up today: The first several U.S. presidents were certainly revolutionaries... and might have been called "terrorists" at the time by the British Crown, after all..."

Say Anything explains to Mr Williams a few of the differences between the Founding Fathers and the Iranian terrorists.

And David Roeder, who was one of the Americans held hostage, remembers his captors well:

Roeder also was riveted by memories of the interrogation where his son, Jim, who has a form of cerebral palsy, was threatened. Ahmadinejad "was not the interrogator or the interpreter, but he was there, and he was clearly in charge," Roeder said.

The threat to his family was detailed, he said. His captors knew the address of the home in Alexandria, Va., where his wife and two children were living. They also knew the number of the bus his son rode to special education class and the location of the school.

Yep, sounds just like something George Washington would do.

Williams seems to think that if two groups are both engaged in a form of "revolution" or "resistance" that makes them equivalent, regardless of the objectives of said resistance or of the methods used. There was a violent and short-lived "resistance" movement known as the Werewolves among young Nazis after the Allied victory in World War II. Would Williams argue that the fact they were engaging in an attempted "revolution" makes them equivalent to the Founding Fathers or the French Resistance?

Williams' comments have been criticized on blogs and elsewhere, and he has attempted to defend himself, as follows:

Today, apparently, on some radio talk shows and blogs, my friends in the media have accused me of labeling George Washington a terrorist. They apparently missed my point: That the BRITISH CROWN might have viewed American revolutionaries that way.

My question — and specifically the line, "what would it all matter..." was meant to address the popular support within Iran for those who acted against the U.S. and are now in positions of power.

It won't wash. Williams didn't call George Washington a "terrorist," but his comment--especially the phrase "what would it matter" clearly tends to set up a specious moral equivalence.

8:45 AM


In Berlin, there is a Checkpoint Charlie Monument dedicated to those killed by the East German Communist regime.

On July 5, the leftist city government of Berlin plans to destroy this monument.

A protest demonstration is scheduled tomorrow, Sunday, July 3. David's Medienkritik has been following this story.

8:36 AM

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