Making Government Cool

Barack Obama apparently wants to make working for the government cool.  Having worked in that sector several times (mostly on the legislative side) I think that is great.  I was never, however, aware that working for the government wasn't cool...but then,  I am definitely not the arbiter of what is cool.

I have a few thoughts about what government has become, though.

Here in Seattle we have just emerged from two weeks of snow and ice.  The City refused to use any de-icing mechanisms on the roads because, apparently, they were worried about salt going into Puget Sound (which, by the way, is a salt water body).  Of course, what they did instead was use sand.  Tons and tons of sand, which the impacts of the increased sediment load into Puget Sound has a far greater probability of impacting species such as salmon, than the diluted salt.  

So, because the roads became essentially impassible for two weeks there were enormous transportation impacts.  Our city, like every other city in the US, is rushing to find money for trolleys, yet the one trolley line we have now, covering about a mile through the north end of downtown to South Lake Union, never ran.  Too much snow on the tracks.  We have become a city that wants people to get out of their cars, yet, few if any buses were able to operate.  Deliveries from UPS to FedEx were not able to be made.  When people started complaining, Jan Drago, a City Councilwoman was quoted in the newspaper as saying she didn't have any problems getting around in her 4 wheel drive SUV.

And of course, garbage was never picked up.  So today in the newspaper, the director of the public utility was quoted as saying garbage pick up will resume on normal schedules on Monday, and oh, by the way, we won't be charged for extra garbage!  What!

Between the "I get around in my SUV so why are people complaining?" and the arrogance of "people won't be charged for extra garbage," I think, at least in this city, our government has forgotten who they work for.  

Council woman Drago should have gotten out of her SUV (which by the way, she consistently votes for reducing parking spaces in high density housing, for spending money on trolleys and other transit methods, so what is she doing owning an SUV much less driving around in it?) and found out how 9/10ths of the city was dealing with the mess.  The head of the public utility should have been apologizing and saying something like: "we understand people will have more garbage than normal and we look forward to making sure every thing is picked up and restored back to normal.  In fact, because we missed pick-ups we are giving every one a credit on their next bills."

A neighbor recently told me about an encounter he had with the building department.  His house apparently is out of compliance with the code because a prior owner built a bedroom in what was the garage without a permit.  As he struggled to get the permits to bring everything back into code, a planner looked at him and said: "gotcha'."

Maybe this is a Seattle thing.  But I have experience the same arrogance with state employees, and don't even get me started on some encounters I have had with the feds.   Of course there are great civil servants.  People who want to do a good job for us.  Empirically, though, I think they are an anomaly, not the standard.  It should, of course, be the other way around.

So, Mr. President elect, if you're going to make working for the government cool, please remember it starts at the top.  Each and every federal bureaucrat or appointed official must be reminded, daily, that they work for the citizens, not the other way around.  It's not about gotcha's or control or power.  It's about service.  

Place, Identity, and Work

In Sunday's Washington Post there was a fabulous article about Chesapeake Bay and the slow erosion of the oyster and fishing communities.  

The loss of oyster and fishing jobs on Chesapeake Bay is less about losing a way of life and more about how our culture has evolved from valuing working with our hands, being based in place to a service culture, where placed based work has become irrelevant.  

And in my opinion that is not good.  It is yet again another sign that our economy is not healthy.

One of the consequences that we are seeing in transforming our economy from place based work to service work is the over development of areas like Chesapeake Bay, or Puget Sound, or the Oregon Coast, or Bozeman, Montana, where homes displace fishing, cattle ranching, oystering, yes, even logging.  Our natural resources in some sense become destroyed because of people building where they think they  can appreciate the natural resources.

Perhaps part of this new new economy should address these issues.  Instead of helping people become more mobile, maybe we need to figure out how to help people stay.

Unintended Consequences

Before an initiative was filed to stop it, the City of Seattle was going to join the ranks of many European cities and begin taxing folks for paper or plastic bags at stores.  Now in August, the City Council has put the issue before the voters.

I have almost always taken my bags to the grocery store.  Back in the day, a local grocery store chain, QFC (now owned by Krogers) used to donate 5¢ to the Washington State Nature Conservancy chapter for each bag you re-used.   Currently, Whole Foods gives you a 2¢ credit for every bag you bring in.  

But Seattle wanted to tax you (although they didn't want to call it a tax) 20¢ for each new bag you used.  Some portion of that tax would be retained by the grocer, but the bulk of it would go to the City.

Aside from the issues of people who don't have enough money, forgetting their re-useable bag, or not having enough disposable income for a re-useable bag, much less initiating a tax during a recession (which never seems to get through to Seattlites for some reason) there are several unintended consequences of this tax which concern me.

Obviously there are some good intentions with this tax.  The idea is that plastic and paper bags are filling up our land disposals.  Of course, so are millions of other things, including the paper and plastic bags from other stores not included in the tax.  The tax targets only grocery stores.  And the City is giving out free re-useable bags, which will mitigate, hopefully, the financial impacts on people.  But the idea that we don't have to use so much paper or plastic is good.

However, here are my concerns:

First, the re-useable bags are probably made in China or some other country.  They are made of plastic, and usually contain advertising all over them, which in not so subtle ways encouraging people to consume.  It's the consumption that is the issue, not the miniscule amount of bags which are used.  And the "carbon footprint" of using a plastic bag, or several plastic bags from overseas vastly outsizes the carbon footprint of paper bags manufactured from recycled pulp here in the US.

Second, paper bags are one of the last timber products still made here in this country.  Pulp mills pay good wages.  Many pulp mills are still relatively local.  Heck many pulp mills are still union.

Third, using plastic re-useable bags (which don't appear to be high quality enough to last years and years, but oh, that's the point, right?) encourages more frequent trips to the market.  That is, unless you have a huge collection of re-useable bags.  More frequent trips translates into more fuel, more consumption...In fact, it's a red flag that the local grocery store association supports this tax (they do get a portion of it, and they also know (this from a daughter and granddaughter of a grocer) that more trips to stores = more income for the grocer)

I think the most important unintended consequence are the jobs.  From the haulers of recycled pulp, to mill workers, to cargo truckers, to warehousemen, stockers in the grocery store, there is a whole vertical chain of people who rely on bags for employment.  Over the past few decades we have become rather cavalier about the elimination of jobs in the natural resource and related industries.  Whole communities have been turned into ghost towns while urbanites casually say things like oh, they can be trained to do something else.  Unfortunately the something else usually looks a lot like making mochas in a drive through.  

In environmental economics it is popular to assert that taxing makes people change behaviors.  And more than likely if the City wins in the election next August (which I predict they will by portraying the folks behind the initiative as bad and evil folks from the chemical industry promoting plastic bags), folks in Seattle will reduce their use of paper and plastic bags.  Meanwhile blinders will be on as another industry falls further into decline, more people lose jobs, and other ghost towns are created.

An alternative, I always believe, is to create incentives.  Bring in credits for using re-useable bags.  Educate people about consumption issues, shopping for more and less trips (buy for the week rather than 7 different trips to the grocery store).  Instead of punishing, how about rewarding?  And how about showing communities outside of Seattle, places that depend upon a pulp mill, a warehouse, a trucking outfit, that we understand their issues, too.

Heaven and Earth

Forty years ago today, Apollo 8 orbited the Moon and beamed to millions on Earth this miraculous shot, one of the first times we had seen our own planet.  The crew of Apollo 8 then read from the Book of Genesis, ending with wishing those of us down on the "good earth" a Merry Christmas.

And here we are, all too familiar with shots of our planet.  Yet every time I see this photo I gasp.  What an amazing miracle we live upon.

Have a wonderful holiday.  

Free Markets?

Sorry no picture with this post.  I spent the better part of today navigating Seattle's snow, slush, and ice, but mostly avoiding people who haven't a clue how to drive when they are scared.  Clearly, most of Seattle has never rented a car in Italy!

But sitting in my SUV washing my own mouth out with soap gave me lots of time to think about free markets.  Finally yesterday's Wall Street Journal arrived this morning.  In it was an editorial about how regulation is stifling innovation and hence capital infusions in Silicon Valley.  My first thought was this op-ed piece must be a joke, then I realized that I have been hearing the "free markets" drum beat for awhile.  

I keep waiting for someone like Paul Krugman to finally blow a gasket and give a succinct lecture on how not only are there no "true" free markets in complex economies, but in fact, those who promote free markets are often the worst abusers of regulation and incentives.  

Someone who has latched onto the idea of free markets is environmentalist Robert Kennedy Jr.  A few years ago he did some interesting writing about how free markets might actually cause companies to clean-up their toxic wastes.  You see, dumping chemicals into a river is considered an externality in economic terms, in other words, it is not figured into the costs of production because our markets, our economy doesn't or hasn't required it to be considered a cost to the business.  Because we do regulate, usually the externality cost is picked up and paid for by, yep, you guessed it, us, the taxpayer.  So, Kennedy thought, what if we actually had free markets where we the taxpayer didn't pick up the cost, but rather leveled the playing field by saying to every company they had to pay the full price of production and we the consumer would pay the full price of the product?

Let's think about this.  In Washington State every few years one of the largest employers, Boeing, lights a fire under our governor or state legislature, saying they will take their production overseas or to some southern state.  In order to stay, they need more tax breaks.  Washington does not have an income tax, so we rely on a sales tax and business and occupation tax.  Indeed, Boeing pays far less tax than a small family run business.  Same thing for the other powerhouse, Microsoft.  Obviously the benefits to the state are keeping people employed, and those employees spend money which the state collects sales tax.  I would guess that the amount of sales tax isn't equal to what those two companies garner in tax breaks.  

Our former Chairman of the Federal Reserve, Alan Greenspan, was a free marketer.  In fact, many free marketers really do believe in the economic theory that people will act in their own economic self interest.  But in October this year, Greenspan finally admitted  that people (more particularly companies) don't always act in what he thought would be their own economic self interest.  The variable that he didn't take into account was the short term self interest rather than the long term well being of companies or even individuals.  

All this is to say think twice when you start hearing the drum beat of free markets need to remain free.  First all, there is no such thing as a free market.  And second, the grey area of semi-regulation either not enforced or non-existent, clearly has failed us.  Often companies use the existence of regulations to nudge or shove competitors out of business (think large timber companies during the Pacific Northwest spotted owl issues), or use the lack of enforcement to continue their short term gluttony (think mortgage brokers selling the now infamous sub-prime mortgages).  Whenever someone talks about the need to keep markets free just think about these past 12 months.  

Quite frankly, my guess is the economy will be a lot healthier if we all admit that there are no free markets and we finally figure out ways to regulate and monitor that enhance creativity in capital and innovation but don't subject the world to these now all too familiar booms and busts.  It seems to me that the Lords of Wall Street can channel their innovation to figuring out how to have a sustainably growing economy rather than how to make a cool million selling toxic securities even they would be better off...maybe proving to Alan Greenspan that people can act in their own economic self interest as well as everyone else's.

Do We Merely Tinker?

In 2006, Muhammed Yunnus received the Nobel Peace Prize for establishing the Grameen Bank in Bangladesh.  What?  A Nobel Peace Prize for establishing a bank?  Well his idea was unique at the time.  Yunnus is an economist, and he conceived of the idea now called microlending, where the loan committee is actually a group of peers, who decide whether a small loan for a business idea such as hiring fellow villagers to create beaded jewelry or buying a few goats to make milk, are valid ideas.  Then a small loan is made, for beading materials or a goat.  The loan committee monitors the progress.  And the original idea was that no one else borrowed until the first loan was paid off.   It was the tribe taking care of it's members.

Microlending became a huge success.  Foundations in the United States, Ford, the Rockefellers, MacArthur all took notice and started funding microlending projects all over the world.  

One of the people who introduced Yunnus to the foundation world was Jacqueline Novogratz who I knew when I worked in New York.  She is, in my opinion, a brilliant and energetic woman who took a MBA from Stanford and decided business principles could be applied to reducing poverty.  After stints at Rockefeller and other foundations, Jacqueline began Acumen, which was one of the first social entrepreneur investment organizations.  She now receives money from Google, and other high-flying Silicon Valley corporations.  She has been profiled in Business Week, Fortune, and The New York Times.   Sigh, I knew her when...

Several weeks ago I lunched with a friend who told me about another friend who recently retired.  This person was thinking about moving to Africa to become involved in microlending projects.  And I remember thinking to myself at the time: why not stay here and do it.

There are some incredibly bright people doing amazing things to help people gain a toe hold for a better way of life.  The ideas skirt the traditional economic models we have all become reliant upon and addicted to in this country, or in many parts of the world for that matter.  Yet, as we watch not just company after company die by the side of the road but our whole infrastructure crumble, perhaps it is time to examine other ways to make this engine run.  There are options.

Which isn't to say microlending  or even the work that Acumen does would solve anything.  But they are creative ideas that have enormous success.  Surely there must be other ideas.  

While I have not said this as eloquently, today the Archbishop of Canterbury wrote an op-ed opining that caring more about economic ideology and less about the people who have been impacted by adhering to the economic ideology is wrong.  

As we begin to look under the hood, I would hope we listen to the Archbishop and don't continue to throw money and time at institutions because we somehow believe this is a small fix.  We need to think about more than tinkering with engine.  And fortunately for us, there are people who have been fixing economies all over the world who are probably ready to help us here.

Come again in about two hours

I had to be out and about this morning, but I have some thoughts that I will get posted in about two or three hours.

So, come again later in the day!

Reconstruction

Ok, remember at the top of this blog I said it would be non-linear?  You may need a road map to follow me on this one, because we might go down a few side paths, hit a dead-end or two, and I haven't a clue where we will end up.  It's all about the journey, right?

Today's news brings sadness.  Vi Hilbert, a tribal elder for the Upper Skagit Salish died.  I had a chance to meet her once, at a reception, and thoroughly enjoyed her grace and sense of "been there done that" calm that she had.  The fact that there is someone considered "tribal elder" is something, I think, we need to start thinking about as we consider how we got into this economic, and hence social mess, and how we're going to find ways to get out of it.

There is a bit of chatter among the opinion forming class that what is really wrong with this country is a crisis of confidence.   That even if the next administration and Congress dumps billions and billions of dollars into infrastructure and so-called green jobs programs, the economy won't change because we are not feeling confident.  

I have rarely subscribed to the idea that economic decisions are based on feeling confident on a social level.  But in this case, I think the pundits are correct.  And while I completely agree that one of the reasons we don't feel confident is our money, our savings, have evaporated, I also think it's because we have lost our bearings.  We got lost in a wilderness of taking care only of ourselves and not our community.

Indeed, at the risk of sounding a bit like a primitivist, I think we need to get back to behaving a bit like a tribe, where we assume care, as a group, for everyone.  Our quality of lives rise and fall with each other's sense of well being.  I am in no way advocating socialism, but I am sensing that we have forgotten our tribal elders, that we don't seek their knowledge and wisdom, and that we have failed to insure that each of us is ok.

I have a friend, Dave, who is retired.  He and his wife, Mary Lu, are retired school teachers.  Their children were their students.  And now their children are their cats.  He has a small craftsman business building fly rods.  Gorgeous fly rods.  Mary Lu, an artist in her own right, helps.  They make enough money, between their retirement and the rod business, to keep their home in Virginia and have two small homes in Montana.  And Dave is constantly telling me about neighbors and friends he has helped.  A little money there, a rod to a returning vet here...he is the tribal elder making sure everyone in his tribe is ok.   I keep telling Dave that he is my hero.  

And that is our job, now, is to reconstruct our tribe to finding ways of caring.  To instill those values so that when the next temptation of a boom comes along (pssst, lady, do you know your house is worth a million bucks?  Why don't you take some money out, spend it, live well.  I have a mortgage just for you...) we all stop, evaluate, and realize our lives are far better off as they are now.  

As we reconstruct out society perhaps we should consult the Vi Hiberts of our tribe.  And we also might want to think about the great joy we get in making sure everyone is doing well.

Bailouts, Stimulus, and Survival

The news this morning is again grim.  The Seattle Times after borrowing extensively against real estate holdings, asking staff for early buy-outs, is now telling the remaining employees that they have to take unpaid furloughs.  

President Bush ordered an emergency bail-out of General Motors and Chrysler.

And I don't know about your email inbox, but mine is flooded with even more and more retailer discounts as they see their inventory sit on shelves a mere 5 days before Christmas.

First let me admit several things:  I have never owned an American made car.  I probably should have after my Fiat caught on fire on Christmas Eve while idling in front of a department store that no longer exists in downtown Seattle while my mother did some last minute emergency run, but I went from my beloved loud and cool sports car to a Volvo box, and from there it's been foreign all the way.  Now however, I can say that almost 100% of my Honda Pilot was made or at least assembled domestically, so that counts as American, right?  I also don't subscribe to the Seattle Times or any other local paper, although I am a devoted scanner on-line.   And, I have barely shopped for Christmas, like everyone else, believing the true discounts will happen this week.  So, on my shoulders rests the economic meltdown.

I also need to admit I have been agnostic about the so-called Detroit bail-out.  That is, until I thought about all the 61 year old administrative assistants who are the sole providers of their families, who have been working at GM for 30 plus years and couldn't get another job.  Or the 29 year old receptionist at an auto parts manufacturer, with a high school education and one kid, living in a double-wide...well you get the picture.  It isn't their fault that GM and Chrysler is suffering from years of mis-management, hubris, and top heavy executives who listened to the Greek chorus of underlings telling them everything was just dandy.

There is now a small cheering section for a bail out of the media, primarily print media.  The reasoning goes that without journalists, how will the public know what is going on.  And like the domestic automotive industry, there is logic to a bail out of the 4th Estate.  While I am not a big fan of either of the local papers here in Seattle, they have periodically done a good job of muck racking.  Recently the Post Intelligencer exposed an amazing amount of fraud and corruption in the local port administration.  

But, if we keep printing and throwing money at industries that have been told for years and years that they need to change in order to survive in a capitalistic economy, and they didn't, at what point do we all admit that either our form of capitalism doesn't work, or that the arrogant folks captaining the ships need to sink?   There is a huge risk that the monies spent on the auto bail-out, like the monies spent on the financial bail-out, are only giving life support for a few more months.  Then what?

Perhaps it is just me, but I am beginning to sense that there is something really wrong with the whole system.  That we really need to deeply examine what our economy is based upon, what it is we want our lives to be like, and how we can get there.  We may need to pull back from the global economy (sorry, China, but maybe we need less stuff), figure out how to survive for awhile while we dig deep not only into the infrastructure of our country but the infrastructure of our society.  

In the meantime, hit a sale this week.  Those poor retailers may be knocking on Congress's door in a few weeks asking for a bail-out, too.

God Bless America

In 2003, comedian Chris Rock came out with a movie Head of State where under slapstick circumstances, he ends up running for president against a heavily favored establishment candidate.  Rock's opponent parodied the politician's standard lines, exaggerating them just slightly enough to make the real versions seem, well, silly.  So the line that stuck with me was when the opponent "signed off" every speech by saying: God Bless America and no one else.  

For the past few days there has been an uproar over President-elect Barack Obama's choice to give the invocation at his inauguration.  Obama's choice, Pastor Rick Warren, is by self-description, an evangelical minister of the Saddleback mega-church in Southern California.  The uproar mostly comes from the "left" who are upset that Obama chose not only someone who is emphatically and vocally against gay marriage, but also is a conservative evangelical on many culturally divisive issues such as abortion, women's roles in society, the place for religion in politics.  

Rick Warren came to the national stage because of his writings, mostly which fall into what I call the health and wealth side of religion.  In other words, if you just believe, all good things will come to you, including your health and monetary rewards.  I apologize for being extremely simplistic.  Because of the size of his congregation, he also commands respect from politicians who believe there is a link between voters and evangelical church membership.

The controversy over Warren is primarily focused over his support of Proposition 8 in California, which put into the California State Constitution a ban on gay marriage, essentially overruling the recent California Supreme Court decision last fall that determined gays in California had a right to marry.  Gays, who 99.9% supported Obama, feel the choice of Warren to even participate in the inauguration is an insult to them.

While I am sympathetic to this side of the issue, I think there is an even larger discussion as seen by the line from Head of State.  While I have not researched this, my guess is that there has been some sort of invocation given at almost every inauguration since George Washington (note to self: that would be an interesting thing to find out).  And it should be no secret to anyone who voted for Barack Obama that he very publicly professes his deep belief in Christianity which he expresses through attending church.  While there is a whole continuum of social beliefs expressed in the vast number of Christian religions in this country (I come from the liberal wing of the Episcopal church which itself is having an uproar), from what I have read about Barack Obama, it seems his religion is much more in line with African-American traditions, which are somewhat socially conservative.  It would be surprising, therefore, if Barack Obama gave up on the idea of an invocation at all.

So Obama, it seems from his public statements on the Warren brouhaha, views this moment as a teaching experience.  Something to the effect that as folks who believe in a new way, in hope, in politics of change, you all had better realize this will include people with radically different views than your own ideology.  Or as he said in 2004 at the Democratic Convention: We are all one country under God.  

And therein is my issue.  Just down the street from me is the greasy spoon fish and chips place that I dearly love and try to avoid.  For the past two years on it's reader board as been this message: God bless the world.  For once, I would love to hear our leaders, both political and spiritual, bless all of us.  To understand that all of us, no matter what our values, ideology, beliefs, and especially what country we reside in, are children of God.  

So, Pastor Warren, congratulations on this acknowledgment on this choice.  President-elect Barack Obama has given you an honor and placed his faith in your ability to see past your own values to acknowledge and lead all of us in prayer for a better world.  And President-elect Obama has also placed faith in us, that we can see beyond Pastor Warren's views to see that he, too, is a child of God and the world.

Learning from Bernard Madoff

Ok, so first this is a cool piece of technology.  If you click onto the title of this blog (Learning from Bernard Madoff) it will link you to a New York Times article about this issue.  Pretty darn cool.

Yesterday I heard a discussion of L'Affair d' Madoff on NPR.  The interviewer was talking with a due diligence officer for some Swiss bank that was curious about investing in Madoff's funds.  

For those who have been truly snowed in, a brief update on the news of the past week.  Bernard Madoff ran an investment firm in New York City (in fact his office was in what New Yorkers refer to as the Lipstick Building, which I used to walk by on my way to work, named because, yes, it looks like a tube of lipstick).  Madoff was famous among the truly rich for bringing in a fairly consistent 10% return on investments, year in and year out.  This is a better rate than the Yale and Harvard Endowments, which are legendary in their investment prowess.  As it turns out, Madoff was running an amazingly lengthy Ponzi scheme.  You know, a Ponzi scheme is where the last in with their money pay the first who want out.  Generally Ponzi schemes can not be sustained for very long, but it appears that Madoff was able to do it for at least two decades and as far as the federal investigators can tell, over 50 billion has vanished.  Yes, I said 50 billion.  So, this due diligence officer was talking about his 2 hour meeting with Madoff in 2000.  And how he went back and told the bank not to invest several billion with Madoff.  He said: I told the bank there were too many warning flags.  

Of course, as it is with these things, now everyone is saying they saw the warning signs.  

However, the Securities and Exchange Commission (SEC) who were notified of the warning signs did some sort of investigation but apparently found nothing.  

There are many lessons in this unfolding story about the failure of regulators, both governmental and the national associations for brokers, dealers, and financial advisors, which license stockbrokers and financial advisors.  As we have witnessed in the past 12 months, clearly those regulatory systems are either non-existent or completely broken.  

But to me the more interesting story is what we can learn about our culture.  Just as with the mortgage/lending/credit debacle, the fact there were warning signs and those who continued to invest ignored them, is something as a society we may want to address.

As I said, Madoff's investment returns exceeded even the large endowments at Harvard and Yale, that hover, I think, around a modest 5% or less.  Now, when you're investing 100s of billions of dollars, 5% is a lot of money.

But here we have people, and let's be frank here, people and companies that invested with Madoff were wealthy, who wanted more than 3 or 5 percent on their returns.  They wanted 10%.  And many people, instead of diversifying their investments, essentially handed Madoff their whole savings accounts.  These people were sophisticated.  Many had financial advisors, accountants, managers (famous Hollywood directors and sports figures).  In today's paper it turns out New York real estate barons also invested heavily with Madoff.

I think what this scandal as well as the mortgage/credit/banking debacle says to me is that we also need to look at ourselves in the mirror.  Why is it we ignore all the signs and proceed to want to make even one more dollar?  Who and what are we putting in jeopardy by our own, well, greed?  From the news accounts it sounds like people were bragging to their friends on Palm Beach, Florida golf courses that they were making these astronomical returns, as if they were better than all the other folks who were sitting on CDs bringing in 3% at best.  It reminds me of the testimony in Martha Stewart's case (the line I am convinced that led to the jury to convict her) when she was telling a friend about the advice she received from her stockbroker to sell before the information became public.  It's nice that we have someone who takes care of our money like that, she said as she was sipping wine at a swanky Mexican resort.  

Being honest, we all aspire to make that extra buck.  And there is nothing wrong with that.  But in another sense, by ignoring the signs that said this high return was an anomaly, the investors are enabling Madoff's theft.  I am not trying to blame the victim, but it's how Ponzi schemes work: they play off of people's greed.

I think it's time to learn from Bernie Madoff.  If the sign says: Warning, slick road ahead, we as a society need to take another route.

Transitioning to...

Today, President-elect Barack Obama announced the final two appointments for his environmental team (last week he announced the Head of the Environmental Protection Agency, the Chair of the President's Council on Environmental Quality, and the creation of a so-called Energy Czar, previously he announced the appointment of the Secretary of Commerce who oversees National Marine Fisheries Service).   Of course, I would think  Transportation and Labor are also environmental appointments, but we'll get into that issue below! You can read an article about the two most recent nominees here. 

Aside from the flaw in all of our thinking that somehow environmental appointments are separate from the economy or national security, as with all of his appointments so far, Obama has nominated good people.  Many in the environmental community will criticize Senator Salazar for the Department of Interior, but I think his background as both an attorney general (for Colorado) and head of the Colorado Department of Natural Resources will serve us well.  The Department of Interior is a complicated agency, filled with competing and cross purposes, and it has become mired down in bureaucratic infighting as well as glad-handing any Tom, Dick, and Harry who has been lobbying the powers-that-be for turning away from wildlife conservation, prying water way from agriculture interests to the ever thirsty urbanites, increasing private National Park concessions, the corruption in awarding status to Native Peoples (think casinos), and of course the press darling, oil and gas leases.  Salazar will have his hands full just trying to get agencies like the Bureau of Land Management and the National Parks reading the same book, much less the same pages.  And each agency within the Department of Interior has powerful and entrenched lobbying interests, from World Wildlife Fund to the makers of snowmobiles.  

Then there is former Iowa Governor Tom Vislack for Department of Agriculture.  There was a "darling" movement afoot to get Michael Pollan nominated.  If you haven't read him, his book on finding wilderness in your own backyard was his best work (Second Nature: A Gardener's Education), but recently he has been ensconced in Berkeley along with Alice Waters, writing about local local local food.  Mid-west farmers are cheering for Vislack because of the ethanol issues, but again, Agriculture is an agency with complex mandates that often conflict with each other.  Briefly, before I get to the forestry matters, there is an issue that I want to beef (pun intended) about.   Why is it we segregate the environment from national security and the economy?  The Department of Agriculture deals with food safety.  Yes, the USDA are the folks who make sure there is no e.coli in your beef, your spinach, and that food which is labeled organic is organic.  

As we can guess, the standards have eroded, not just over the past eight years, but over many years of deregulation and anemic funding.  To me, food security is as vital a national security issue as homeland security (and can we please get rid of that WW II Germanic term?).  In a simple civics sort of way, the role of government is to protect people, and protecting us from, well, to be blunt, the greed that makes slaughterhouses, feedlot owners, yes, even organic producers take short cuts that lead to outbreaks of mad cow, e.coli or whatever else, is just as important as protecting us from international terrorists.  

Vislack also has his hands full but aside from the ethanol issue, I think he will be a measured, disciplined, and enthusiastic head of Agriculture.

Now, the Department of Agriculture is also the agency that runs our national forests.  I was always amazed at how many of my forest policy students thought the US Forest Service was under the Department of Interior.  Nope.  We will not know who the Undersecretary for the US Forest Service much less the Supervisor of the Forest Service will be for a little while.  But I think these will be significant appointments not only for how the federal forest are managed, but for leadership on rural economic issues.

And here is my tie-in with the economy, which I will write about again in the near future.  Our management of natural resources during the past twenty years has been frightening.  We have exported our need for timber to Canada, New Zealand, Chile, Russia...importing not raw logs, but finished product.  Logging, milling, delivery jobs were all once middle class jobs, providing generations of families a quality of life they can only vaguely remember, now.  I am not advocating that we return to the bad old days of acres and acres of clear-cuts, but I am beginning to believe that we need to regenerate our timber industry in this country.  We need to encourage sustainable logging, milling a quality product, and delivering those goods to markets that are relatively close.  Years ago I did a significant amount of research on locating residential development around working forests, where essentially the community becomes part of the decision making process in the management of the forest.  From those ideas sprung what is now called Community Forestry, which is an rather amorphous idea but worth percolating up into the national dialogue and away from the special interests that seem to want to de-rail it.  Interestingly, in my recreational reading of John Wesley Powell he advocated similar ideas.  

Returning to some sort of timber industry in this country would do the following: conserve rural communities, preserve privately held forests, increase well paying jobs, allow this country to actually manufacture products, and in our national forests help restore forest ecologies that have been abused by an unhealthy fire suppression policy.  While I strongly advocate what is called a "restoration economy" (paying people to restore our forests) there simply is not enough jobs or money in that work.  The same is true for non-timber forest products (think mushrooms and greens) even though for a short period of time wild mushrooms were enjoying amazing prices.  But to amp up mills will also create manufacturing jobs (to re-tool the mills), white collar supervisory positions, and of course all the supporting economies in the towns.  We actually have the technologies to make the mills "green," and the forestry science to protect ecosystems.

As I said I will write a lot more about this in future days and weeks.

In the meantime, I wish our President-elect would view his appointments more holistically.  It's all about the environment, national security, and the economy.  I think he does understand that, but his role as our leader is to help all of us grasp this idea, that it is all linked.  To pull us out of this recession is going to take all of us giving up particular fights that we are seeking to have, whether it is to prevent any logging on national forests or keeping food costs down or bail outs to Detroit car manufacturers.  We are in a time of transition...