Lewis Carroll – BONUS POST

The Bonus Book of the Week is “Lewis Carroll, A Biography” by Morton N. Cohen, published in 1995.

Born into a family whose children eventually numbered eleven, in January 1832 in Cheshire (England), Carroll was given the name Charles Lutwidge Dodge. His father was curate of the local parish.

The headmaster of “Rugby”– the boarding school Carroll attended (which gave rise to the eponymous sports game), couldn’t “… rid the school of drunkenness. The boys were served beer with their meals– water was unsafe– and from beer to strong libations is not a long leap.” Rugby was considered England’s best public school (in America this means an elitist private school) at the time.

Carroll endured the usual abusive hierarchy (frat boy behavior) that occurred at such a place for nearly four years. Later, he was accepted to Christ Church, at Oxford University. Students from wealthy families brought their hunting dogs to school, and continued their shooting and riding, as they had at home. Academics were way overrated.

Carroll, however, majored in and got high grades in mathematics. After graduating, he became a math tutor and lecturer. But he got upset when he saw freshmen who were ignorant of material he thought they should have already learned.

In an attempt to cover up this embarrassing truth, in April 1864, the school administration proposed lowering its standards, and finally succeeded in doing so in February 1865. In protest, Carroll resigned as Mathematics Examiner.

On another topic, of course, Carroll became best known for Alice’s Adventures in Wonderland. It started in July 1862, as an extemporaneous story he made up about Alice Liddell, one of the middle daughters (about twenty years his junior) in a large family full of them. He became quite close with the girls socially, accompanying them on walks, picnics, boating outings, in playing croquet, etc.

Nearly a year later, he rode a train alone with the girls– who were without their usual adult supervision. Shortly thereafter, their mother forbid Carroll to see them. Wild rumors swirled around the mysterious incident; the page on which Carroll wrote about this in his diary was removed– lost to history– by his niece.

As an amateur photographer, Carroll had been taking photos of his aforementioned unnaturally close friends, as well as daughters of other families in his community. In spring 1867, he began taking photos of girls in the nude.

Read the book to learn of all of the details about the above, other highlights of his life, and how the “Alice” stories evolved into an enduring piece of work.

ENDNOTE: Curiously, the author of Peter Pan, J.M. Barrie, befriended a family of sons. He took an especial liking to a middle son, Peter, about which he made up stories at the dawn of the twentieth century. Both Alice and Peter Pan have been enjoyed in various incarnations internationally for decades and decades. Parallels can be drawn between their authors. The stories must therefore delve into the deepest, truest universal aspects of human nature. That must be why they are still classics.

BONUS POST

I am pleased to announce that my book: “The Education and Deconstruction of Mr. Bloomberg, How the Mayor’s Education and Real Estate Development Policies Affected New Yorkers 2002-2009 Inclusive” is available through the following online channels:

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Highly Confident

The Book of the Week is “Highly Confident, The Crime and Punishment of Michael Milken” by Jesse Kornbluth, published in 1992. This volume described a situation that lends itself to the hypothetical board game “Survival Roulette: Wall Street Edition” (See “Blind Ambition” post).

There have been countless ultimate winners of this game through the decades: all the people never caught for securities-industry crimes. A million lawbreakers a day go unpunished. That doesn’t mean the crimes didn’t happen.

However, the most famous hypothetical losers of the game in this book were Ivan Boesky (an independent bond trader in New York) and Michael Milken (bond-trading executive at Drexel Burnham Lambert in Los Angeles). Other losers could include Dennis Kozlowski, Bernie Ebbers, Kenneth Lay, Steve Jobs and Richard Scrushy.

The board spaces could include Go To Jail (of course), and describe the financial crimes of: insider trading, Free Parking (or “stock parking”), disclosure failures, material misstatements, accounting irregularities, re-pricing stock options, and fraudulent conveyance, but also specific actions of conscience-salving philanthropy in which Milken engaged– such as throwing money at cancer research, and volunteering to teach math to nine and ten year-olds.

In August 1986, the U.S. Attorney’s Office of the Southern District of New York began an investigation into Securities and Exchange Commission (SEC) violations in the bond industry. By October 1986, the head federal prosecutor there, Rudolph Giuliani, was taping phone calls between Boesky and Milken. This, because Boesky had immediately accepted a plea deal to turn state’s evidence in exchange for a slap-on-the-wrist, country-club jail sentence. Boesky was one of the game’s lesser losers, to be sure. He was the king of lying, cheating and stealing.

Milken was a creative workaholic math genius whose meteoric career-rise allowed him to head an entire bond-research department in his mid-twenties. But he had zero ability for honest introspection.

Milken was a master at controlling his environment and other people, but he deceived himself about his “breaking the rules of the game” in his industry. He thought he was helping people all the time, but didn’t see how others were indirectly hurt by his actions. This kind of hubris syndrome is not uncommon in alpha males.

In 1978, Milken initiated the push to have Drexel underwrite junk-bond deals that financed hostile corporate takeovers. This wasn’t illegal in itself, but Boesky persistently badgered Milken until, by the early 1980’s, the latter was eventually manipulated into breaking the law.

Milken had a history of selfless philanthropy, yet his business actions gave rise to obscenely high fees made by his employer, an obscenely high income for himself, and crushing debt load for his clients. This led to extremely adverse financial and social consequences for thousands upon thousands of laid-off American employees of merged companies, subjected to disrupted lives and untold stresses.

The mood of the securities industry could be described thusly: “… with the election of Ronald Reagan… All that mattered was an ability to make money — without concern for risk, without regard for regulation.”

The investigation and resulting plea deals had the law enforcement agencies patting themselves on the back for convincing the perpetrators (other than Milken and Boesky) to implicate others, but the immunity deals the perpetrators got were a joke, considering that they themselves had serious credibility problems, and serious violations. It was a kangaroo court.

Nonetheless, the following parties launched investigations: Drexel and its attorneys, Milken and his attorneys, the U.S. Attorney’s Office, and the SEC. Those last two, of course, engaged in fierce rivalry. By September 1991, there was an orgy of litigation against Milken. The roll call involved fifty-eight lawyers (!)

Around the same time, Wedtech was another 1980’s scandal borne of out-of-control greed. In that case, a personal injury attorney generated billing documents that purported to show charges for legal services, that were actually for lobbying. Wedtech’s executives bribed politicians for the purpose of influence peddling, and swindled shareholders. This kind of crime is not uncommon.

Along these lines, if, for instance, a real-estate mogul declared business bankruptcy repeatedly throughout his business career, why did investors trust him with their money again and again and again and again and again?? Perhaps there was influence peddling. The politicians were his puppets who eventually passed legislation favorable to them all. It was worth it to them to risk losing all their chump-change investment to get access to future (much more) profitable contacts and politicians who did their will.

Anyway, Milken hired a team of lawyers who were the cream of the crop of Northeastern elitists. Yet, unfortunately for him, the media and law enforcement made him the poster-boy / scapegoat for the greed of the 1980’s.

Ben Stein, a wannabe Hollywood writer, was, according to the author, an individual who fueled public outrage against Milken. He was unwisely hired to write articles for Barron’s (a major Wall Street publication) after Milken was indicted. The nature of his utterances in print were “Shocking, unsubstantiated, never-proven assertions made with absolute certainty.” Stein claimed his taking of the drug Halcion caused him to produce such libelous garbage.

Strangely enough, insider trading wasn’t what Milken was jailed for, but rather, a minor disclosure failure. The judge in his case was ridiculously misguided, considering that the court calculated the dollar value of damages Milken caused was a mere $318,000. But the court saw that the revenues generated by him and his firm were in the hundreds of millions of dollars. So the court fined him $600,000,000.

Read the book to learn of Milken’s prison sentence and numerous other details of the whole tabloid-crazy affair.

Ibn Saud

The Book of the Week is “Ibn Saud, The Desert Warrior Who Created the Kingdom of Saudi Arabia” by Michael Darlow and Barbara Bray, originally published in 2010. This wordy and redundant biography described the life of a pivotal figure in the history of the Middle East in the twentieth century and his legacy in the twenty-first century.

Abd al-Aziz ibn Saud (hereinafter referred to as “Saud”) was born circa 1881. He was the oldest surviving son of his forever growing family. The culture of his Islamic, nomadic tribe involved a Robin-Hood like practice called “ghazzu.” Only at a time when a tribe was literally starving, would it rustle camels and/or livestock for itself, from a tribe that was better off, inasmuch as it needed to survive. The raid was not for the purpose of conquest.

A boy would become a man by aiding his fellow men in such a raid. Due to a forced evacuation by a militant attack by the Rashid family in the Middle Eastern desert in 1891, Saud left his family when he was about ten. He assisted with a ghazzu with the Al Murra– one of the poorer Bedouin tribes. They were Muslim, but not as fanatically religious as the Wahhabis in Riyadh, where Saud’s family lived.

Saud’s family was allowed to reside in Kuwait until his father could regain his sheikdom from the Rashid family. In the 1890’s, the whole region was being fought over by the Ottoman Empire, Germany, France, Russia and Great Britain for purposes of international commerce, rail transportation and shipping.

In 1899, Saud took a bride in his second arranged marriage, and his first son was born the following year. He was to have: more than one hundred wives, almost one hundred children, plus numerous concubines in his lifetime, but only three wives at any given time, pursuant to the Quran. At that time in Saud’s culture, divorce was cheap and fast.

Saud led men into the vendetta-laden battle between his family and the Rashid. Allying with other tribes in the area, they fought on camels with swords, rocks and fire. Saud achieved victory in January 1902.

Two months later, his messengers arrived to tell government leaders in London, India, Istanbul and Moscow. Saud’s father’s army retook the territory over the next two years, but the Ottoman empire had the resources to re-conquer the Saud family’s small military and tentative claim on land the Saud family had previously owned. So the two parties signed a treaty conditionally acknowledging the land’s owner.

Until WW I, Saud allied with the Wahhabi tribe, Ottomans and British, but would not help them during the war. To Saud, the Rashid remained an enemy, and Sharif Husayn– British diplomat and leader of a rival tribe– became a new one. All still had territorial claims to the Arabian peninsula.

In 1922, the presence of oil was suspected in the disputed territories. However, the oil drilling equipment at the time was too primitive to the find the oil.

In the mid-1920’s, Saud was allied with the Wahhabi-related Ikhwan tribe, which were fanatically religious and violent with their livestock-grabbing, looting, plundering, destroying Shia artifacts and killing enemy males of all ages– forcing them to flee the Arabia/Iraq border. Saud had to tell the Ikhwan to cool it. Even so, Saud didn’t compensate the enemy for his allies’ war crimes. He kept all the territory he got, and acquired more.

Into the early twentieth century, the Arab tribes thought of the desert as an ocean, around which they could wander because no nation had a sovereign claim on it. Since Najdis (residents of Najd) and Iraqi Bedouins (both allies of Saud) were having border skirmishes against the British, the British thought they had a right to build forts to clarify their claimed territories to corral the local nomadic tribes. Of course the British, having a more advanced military and weaponry, plus the world’s best navy, had the upper hand on the ocean too.

In 1928, one oil company each from America, Britain, Netherlands and France agreed to divvy up any oil that was discovered in the Middle East.

After various battles, finally, in September 1932, Saud named his territory the kingdom of Saudi Arabia, governed exclusively by a literal interpretation of the Quran. In other words, It was a theocratic, not a constitutional, monarchy. For the rest of Saud’s life, excessive amounts of money were spent on keeping Saudi Arabia’s citizens (Saud’s royal family and others, plus millions of charity seekers–to whom hospitality was an obligation according to the Quran) loyal to King Saud.

Read the book to learn what transpired:

  • when a significant amount of oil was finally discovered in Saudi Arabia;
  • what Saud did just before and during WWII;
  • that led the Americans to become besties with Saudi Arabia for decades– which was related to how Saud reacted to the debate over the territory of Palestine and how Saudi Arabia ran into financial trouble in the latter half of the twentieth century; and
  • when Saud died– how his successors led the country in the next half century.

King of the Club

The Book of the Week is “King of the Club” by Charles Gasparino, published in 2007.

The subject of this book “… was suffering from the downside of loyalty; he spent so much time surrounding himself with people he could trust that he forgot he also needed smart people who could get a job done in times of crisis, and he was now facing… the greatest crisis of his career.”

Sounds familiar. It was actually “Richard Grasso and the Survival of the New York Stock Exchange.” When he was fifteen years old, Grasso began trading stocks in an account held in his mother’s name, getting stock tips from his drug-store-owner-employer.

The author was rather vague about Grasso’s two years of military service which allegedly began in the mid 1960’s, spent: “…in Fort Meade, Maryland, though he did make periodic trips to Vietnam.” Apparently, Grasso’s eyesight was good enough to get him drafted by the U.S. Army, but not good enough to get him hired by the New York City Police Department, his first-choice employer after the military.

Grasso therefore began work as a back-office Wall-Street clerk at the New York Stock Exchange (NYSE) in early 1968. The author failed to mention whether Grasso was told to put his stocks in a blind trust, or whether his new employer had a “don’t ask, don’t tell” policy.

Grasso meteorically moved up through the ranks. He was innovative in executing new marketing initiatives for the exchange. He also poached companies that were listed on either the American Stock Exchange or the NASDAQ– that provided fierce competition to the NYSE. All three were stock markets of corporate entities that wanted to sell their shares far and wide. But the companies could be listed in only one place. Grasso convinced them that the NYSE was the best place to list.

By 1980, Grasso controlled NYSE listings, its trading floor and almost all its trading operations. In the mid-1980’s, the chair of NASDAQ, Bernie Madoff, claimed his market’s trading was more fair for investors because it executed trades electronically, thus multiple players were interacting continuously while setting impartial prices. The argument went that electronic trading made the market more “efficient”– as no buyers or sellers had significantly better pricing information than others on which to trade, theoretically.

In 1990, Grasso stepped up to the second-most powerful position at the NYSE. He was in charge of the exchange listees and, at the same time, in charge of regulating them. He did the legwork of bringing new business to the exchange. His boss, the chairman, did the public relations work of delivering speeches globally and persuading the federal government to keep conditions favorable for the exchange.

Several of the NYSE’s board of directors were Wall Street executives who passively continued to keep the status quo– lavishly rewarding Grasso monetarily for his undivided attention to lavishly lining their pockets year after year when times were good.

There was honor among thieves, as Grasso’s henchmen turned a blind eye to the various forms of illegal activity that allowed them to make obscene amounts of money on the trading floor. Until there wasn’t honor among thieves– as conditions changed.

From a not-for-profit-organization-legal-standpoint, most of the parties and individuals involved were engaging in various highly unethical activities, at best; conflicts of interest abounded as participants in the exchange network cooperated in a way that maximized profits for everyone until, as usual, some individuals got too greedy.

Being head of the New York Stock Exchange is not unlike leading the U.S. government. The marriage of politics and commerce is always fraught with conflicts of interest. Some are avoidable. It’s a shame that politics in particular tends to attract dishonest attention whores with hubris syndrome whose ethics are in the basement. Of course, they usually use the “everybody does it” excuse and change the subject if they can.

But there ought to be equal justice under the law for any of the accused– after an investigation of where the evidence leads— with NO jumping to conclusions, assumptions or biases prior to a thorough review of all evidence, if any. Along these lines, one would do well to ignore the superlative-laden, repetitive, sensationalist drivel emanating from the teleprompter box, um, er– idiot box.

Anyway, starting in the late 1990’s, unbridled greed led to a bunch of scandals. There was Long Term Capital Management, Enron, WorldCom, the dot-com crash, various major SEC violations committed by big-name brokerages; not to mention 9/11’s impact on the financial markets. All on Grasso’s watch. Yet, his pay kept soaring, anyway. It wasn’t pay-for-performance anymore.

Finally, Grasso got the same treatment, figuratively speaking, as other major historical figures. One week he was flying high and the next, kicked to the curb. Grasso was suffering from a bad case of hubris syndrome. In early September 2003, herd mentality / groupthink seized the board; jealousy (possibly subconscious) of his pay package reached critical mass.

Read the book to learn of the usual occurrences in such a situation (investigation, litigation, political machination and myth propagation) that led to the changing of more things, and more of same.

Undercover

The Book of the Week is “Undercover, The Secret Lives of a Federal Agent” by Donald Goddard, published in 1988. This was the biography of a New York City undercover drug agent allegedly named Michael Levine.

Born in December 1939 in the Bronx (in New York City) among blacks and Latinos, Levine’s childhood was fraught with fighting and underage drinking. At eighteen years old, he applied to join the Air Force but pursuant to his aptitude test results, was assigned to the Air Police. He, helped only by a German shepherd, ended up guarding American nuclear weaponry in a rural area near the Canadian border. He enjoyed the work, but after a year, got into a fight sparked by racial tension.

In the next several years, he found that intelligence work was his calling. That was the way to put his acting talent and street-Spanish language skills to use for good, to combat evil. He did time at the IRS Intelligence Division, and then the Alcohol, Tobacco and Firearms (ATF) agency, part of the Treasury Department of the federal government.

Sometimes as many as four other government entities (FBI, CIA, IRS, NYPD) were supposed to cooperate to surveil a mafia don in the neighborhood of Little Italy in Manhattan (New York City). The undercover work became a joke because the don knew he was being tailed, and the don’s driver told the spies where he would be going. Working morning, noon and night, Levine frequently got his man, arresting all walks of life of the criminal underworld– possessors of unlicensed guns, drugs, stolen driver’s licenses and credit cards– taking on five or six cases at a time.

From the ATF, Levine was promoted to customs inspector, under the auspices of the State Department, where he got more power than ever. He was able to execute searches without a warrant, and operate internationally. In 1973, he survived the consolidation of entities of law enforcement of cocaine, heroin, hash, marijuana, etc.– into one Drug Enforcement Administration.

Levine’s favorite place to work was on the street. He wasn’t meant to be a paper-pushing bureaucrat in an office. One kind of case he worked might involve a “buy-bust” on the Lower East Side (of Manhattan) in which the informer was an “orange-haired Cuban bisexual who lived with the female Jewish butcher” that resulted in the arrest of three Mexicans who possessed a full kilo of heroin.

Levine acquired more than two decades of experience masquerading as an insider in the New York City drug scene. He witnessed all aspects of it, handling thousands of cases, working harder, and more hours than most other law enforcement personnel. He testified in court as an expert witness countless times. Therefore, he felt he knew the least bad solution to the ever-increasing societal problems stemming from the abuse of drugs.

Levine said the drug users were the problem– they were the ones generating demand for the product. If they disappeared, so would the problems because the sellers would go out of business. He pointed out that the “… dealers weigh the risks against the money they make. They don’t respond to fear of the law.” The users would.

Levine recommended that there be strong deterrents: hard prison time for illegal-drug possession and illegal-drug intoxication of the slightest amounts.

At first glance, that recommendation seems logical. Of course, Levine’s career would get a gigantic boost in the event of such a trend. For, Levine described his undercover work thusly: “We’re paid to lock people up, that’s all. What happens to ’em after that has got nothing to do with us. It’s up to them, their attorneys, our attorneys, public opinion, politics, the media… Juries convict people, not agents… But that’s not to say you won’t face real dilemmas about guilt and justice.”

HOWEVER, considering the consequences, one begins to think, “Oh, that’ll end well.” Harsher punishments would create as many problems as they would solve. The trouble was that many of the users were also dealers. So if the users/dealers were the sole source of income for their families, and the users got locked up for a long time, what happened to their families?

The jails would become overcrowded, and there would have to be a massive hiring effort to build more prisons, and catch, process, judge, guard and legally represent the additional soon-to-be prisoners, not to mention the legal can of worms that drug-testing would open up.

Not only that, such a major change in the legal system would highlight the two-tier justice system in this country. Poor people of all ethnicities possessing drugs would be imprisoned. As always, the troubles of those people (most of whom began their lives in unlucky situations) would be compounded. Just ask any public defender– whose caseload would increase, but his or her budget wouldn’t.

This, while the rich people (such as those in the Hamptons– the summer-vacation region on Long Island in New York State), would skate. Those inheritors of wealth and privilege could afford to hire high-priced attorneys. They would squelch the bad publicity that would result from their indiscretions by paying people to shut up and go away with non-disclosure agreements. Their families might have been just as dysfunctional as those of the poor, but the public would never hear about any of that.

As is well known, addicts hurt themselves and their families, but are usually not a danger to society at large, unless they get behind the wheel of a car, or operate heavy machinery. Or get into a gunfight over a drug deal gone bad. However, as an aside– there ought to be NO inherent unfairness in imposing very harsh penalties on possessors of firearms that were acquired ILLEGALLY. Applying the “broken windows theory” of crime to such possessors would likely prevent countless violent crimes.

For, the kinds of people who get hold of guns when they shouldn’t, are the kinds who use them in not-so-nice ways. So it would seem that they would be much more dangerous to society at large, than addicts.

In recent decades, there has been a media trend to report on human interest stories of mass-shooting victims so as to not glorify the shooters. But the news cycle on them ends, and celebrity non-stories, hysterically reported, grab the headlines again.

There’s no follow-up– NO reporting of punishment, if any, for the shooters subsequent to their pleas or trials, if they weren’t killed at the scene of the crime. Perhaps if the media showed (with harsher, new laws) the serious punishments resulting from the shooters’ actions again and again, there would be less tolerance in society for illegal firearms. This might be a start.

Anyway, read the book to learn the details of Levine’s life.

How the Post Office Created America / Superpower

The First Book of the Week is “How the Post Office Created America” by Winifred Gallagher, published in 2016. This was a detailed account of the history of the delivery of written communications in what is now the United States.

In the 1630’s, a Boston-area tavern doubled as the first post office. Local politicians and rich businessmen collected their Transatlantic written correspondence there; the latter paid for the privilege. The service was “… primarily designed to advance an imperialistic power’s interests, serve a narrow elite, and produce some revenue for the [British] Crown.”

It was in the interest of Great Britain to improve the roads to distribute the mail in the thirteen colonies (which later became the United States), as she was competing with France to rule the colonies.

Postal carriers had to deal with unforgiving land, mountains, rivers and hostile Native Americans in making their appointed rounds. A month might elapse, what with uncertain weather, before mail went from Boston, MA to Richmond, VA. The literate read letters aloud to update their fellow community members of goings-on in places far away.

Ben Franklin was a prominent figure in the mid- to late 1700’s due to his numerous, various contributions to humanity. Between and among the colonies– Canada and Britain– in the mid-1750’s, he served as one of two Postmasters General.

The colonists were demographically and geographically fragmented even after they became Americans. There were Puritans in Massachusetts, Dutch traders in New York, elitist slave owners in the South, and pioneers in the Midwest. But they all agreed that there should be a nationwide free exchange of ideas.

Read the book to learn how mail delivery quickened with more advanced forms of transportation and mail-sorting, what the “Pony Express” really was, and the controversies over: a) postage rates for different regions; b) which entity should authorize mail delivery– the federal or state governments, or private companies; c) whether the Post Office should stray from its core business of delivering only written communications, including newspapers and magazines (rather than electronic, or packages), and more.

In the United States, delivery of written communications evolved into a public-private partnership, as has the distribution of electric power. The two have become interconnected because communications have increasingly required electric power. Government regulates the two because they are the trappings of an industrialized society and massive disruption of them might cause significant economic and social (not to mention political) harm to the nation.

Some Americans are pushing to significantly reduce pollution by sourcing electric power from wind and sun. That activity, which is growing in popularity, was described in the Second Book of the Week– “Superpower, One Man’s Quest to Transform American Energy” by Russell Gold, published in 2019. This was the career biography of Michael Skelly, renewable-energy entrepreneur.

As is well known, what to do about environmental pollution has been a political football for the last few decades. In the late 1970’s, when Minnesota farmers used weaponry and sabotage to protest the building of power towers on their land, a Minnesota state trooper commented, “Whenever there is progress, there is change and change does not benefit everyone. Change is hard for some people to accept.”

In the Obama administration years, the U.S. Energy Department funded a study conducted by the National Renewable Energy Laboratory outside Denver.

Researchers used a supercomputer to analyze hypothetical scenarios in 2026 in which wind and solar power would account for thirty percent of the power generation of the Eastern Interconnection (infrastructure that would transmit energy across states and provinces between eastern New Mexico and Quebec, Canada); electric power would go back and forth, depending on need. The results were promising. Once infrastructure was in place, costs wouldn’t be significantly higher than fossil fuels or nuclear energy.

For, wind and sun are free of charge. Fossil fuels’ prices fluctuate. True, wind and sun aren’t available 24/7, but a giant network spanning thousands of miles would allow energy to be transferred across time zones wherever needed, when wind and sun aren’t available.

Skelly was a doer. He didn’t waste time in “Twitter feuds or policy battles.” In the early 1990’s, after acquiring life experience in the Peace Corps and Harvard business school, he supervised the construction of an unprecedented tourist attraction in Costa Rica: an open-air gondola / tram from which travelers could view flora and fauna from the rain-forest-canopy.

Then Skelly got into wind farms. Building them involves an extremely expensive, years-long series of steps to get cooperation from numerous stakeholders such as investors and local: residents, governments and utilities, not to mention the federal government. The company building the turbines sees nary a penny of revenue until it sells the energy. It must get a slew of regulatory approvals, and fend off angry opposition and lawsuits.

Interesting factoid: by 2007, Texas had surpassed California in renewable energy generation.

Bankruptcy is always hanging over the head of the project initiator. In 2005, Skelly and his fellow executives were able to sell to Goldman Sachs a 90% interest in their company. Getting the investment bank involved enabled them to purchase a few billion dollars’ worth of turbines from Europe. Goldman got a major tax break for building the wind energy project.

Skelly was a conscientious individual. Federal law required a different, later venture of his– Clean Line– to have one public meeting with the locals. Clean Line had fourteen meetings. Skelly spent eight years involved with another project, Plains and Eastern. “It would be a $9.5 billion private investment, generating thousands of manufacturing and construction jobs and using enough steel for four aircraft carriers.”

Read the book to learn all the details of Skelly’s trials and tribulations in supervising renewable-energy projects.

Financier

The Book of the Week is “Financier, The Biography of Andre Meyer, a Story of Money, Power, and the Reshaping of American Business” by Cary Reich, published in 1983.

In the 1950’s and 1960’s, Meyer was a pioneer of the mergers and acquisitions craze in corporate America. He was the head honcho at the investment banking firm of Lazard Freres.

The firm exploited the trend, switching from supplying venture capital to advising its clients which were institutional, to form conglomerates, because it was thought that bigger was better. Other firms spent big bucks on research analysts, whose pronouncements were sometimes wrong. Lazard specialized in numerous, diverse, creatively structured deals.

Beginning in August 1951, for instance, for the purpose of minimizing the tax on the purchase and sale of an eight hundred thousand acre cattle ranch in Texas, over what turned out to be the course of a decade– Lazard split up the real property into sixteen different parcels, each owned by a different corporate entity. This way, the eventual 80% profit on the approximately $18 million investment was classified as capital gains (taxed at 25%) rather than real-estate income (taxed at 90% in those days; that’s not a typo).

The absolutely most valuable investment in the 1950’s and 1960’s was real estate because inflation was only 1%, and real estate ventures were easy to form. This was shown by Bill Zeckendorf, who (after obtaining loans with usurious terms on various occasions from Lazard), in August 1968, with assets of $1.8 million and debt of $79 million, rose from the ashes of bankruptcy to form General Property Corporation, and continued doing real estate business.

In early 1977, Meyer “… was convinced that the world was heading for economic apocalypse, that capitalism was dying, that government deficits and inflation were out of hand, and that nothing was a safe investment any longer… Should you buy gold? Stocks? Art? Bonds? And he didn’t want to buy anything.”

A man with his life experience should have known better. As is well known, the economy recovered within a decade. Granted, it got worse before it got better, and of course, shortly after that, there occurred a stock market crash and recession. But one need only wait ten years or less to see major changes in the nation’s economics (and politics for that matter; not that there aren’t lingering scars).

Excuse the cliche, but this too, shall pass.

Read the book to learn about Meyer’s major deals, the corporate culture of Lazard Freres, and how its reputation was hurt when it became too creative with its complicated stock swaps in its underwriting activities.

George F. Kennan

The Book of the Week is “George F. Kennan, An American Life” by John Lewis Gaddis, published in 2011. This is the biography of an emotionally troubled American diplomat, an expert in Russian– the language and mentality– who became known for his historical writings on the Cold War power struggles between the United States and the Soviet Union; the struggles arose from the the two rivals’ weaponry and opposing ideologies.

Born in February 1904 in Milwaukee, Kennan was raised by his three older sisters and other relatives after his mother died in spring 1904. His father was 52 years old.

In 1910, Milwaukee elected a Socialist mayor. The city was a melting pot of Western, Eastern and Northern European immigrants. Kennan graduated from a military school, then from Princeton University. The Foreign Service had recently become a civil service job, comprised of Northeastern elitists.

After passing its two exams, starting in 1927, Kennan was posted to Geneva, then Hamburg, then on to Estonia to learn Russian. He met his 21-year old wife in Norway. They eventually had four children. After stints in Riga in Latvia, and Prague, he spent most of the rest of his career in Berlin, Moscow, Washington, D.C. and New Jersey.

In 1944, as WWII was winding down, Kennan tried to convince President Franklin Roosevelt to sternly warn the USSR not to expand geographically. Roosevelt, in a tough position, argued that the Allies couldn’t win the war without the USSR’s military assistance, so he had to tread lightly with Stalin; Harry Truman, too. The president had to deal with one issue at a time. Those men in Los Alamos couldn’t say how soon the atomic bomb would be ready. That was the kicker.

Stalin tried a divide and conquer strategy– to drive a wedge between the United Kingdom and the United States so they would fight. Nevertheless, after the war, they became best friends.

For the second time, and it wouldn’t be the last, Kennan submitted a letter of resignation, as he perceived that his counsel and advice were being ignored. Nevertheless, he was convinced to stay on at the Foreign Service. He read the classic novels and plays of Tolstoy, Chekhov and others to understand the Soviets’ behavior.

In February 1946, Kennan sent a telegram which later became famous, urging the United States to take a hard line with the Soviets. But it was already too late. Six months later, he “…saw how Soviet ambitions, American complacency, and British weakness might combine to upset the balance of power in Europe.”

According to the author, Kennan’s input for the Marshall Plan– whose purpose was to financially aid the then-needy, war-ravaged European nations (with the true goal of warding off a Communist takeover)– was to suggest to offer such aid to the Soviets knowing Stalin would reject it. Stalin also told the Soviet satellites to reject the aid. The Americans then knew which countries needed help (in countering Communism).

In summer 1947, Kennan recommended that the sixteen countries split up the aid themselves rather than let the United States decide, so that way, the USSR couldn’t claim the United States was acting imperialistically. The recipients could spend the funds on food, arms– whatever they wanted.

Around that time, the US established the CIA. Kennan agreed that the organization should conduct covert operations to keep up with the KGB. He later regretted agreeing on that issue.

The US couldn’t afford to politically, militarily and financially help all nations vulnerable to Soviet domination, but Kennan advised President Truman on which regions were most at risk, and where America’s resources should be deployed. He told him to cease assisting Chinese Nationalist Party leader Chiang Kai Shek because Stalin had already staked out strategic military locations within striking distance of China, and China posed a minor threat to the US, having a shaky economy anyway.

In short, Kennan believed in particularism– a practice of selectivity in taking action against the Soviets. The newly formed United Nations believed in universalism– all nations should share and share alike, regardless of cultures and ideologies.

In early 1948, the Soviets took over the Czechoslovakian government. In the spring, in a lesser wrong, America meddled in Italy’s election– threatening to cut off Marshall Plan aid to the government if people voted for the Communist party instead of the Social Democrats. Additionally, Italian Americans wrote lots of letters to the Vatican, which told Italian voters for whom not to vote.

In January 1957, pursuant to the Suez Canal Crisis, President Eisenhower signed legislation based on the doctrine that the United States would financially and militarily assist any Middle Eastern nations vulnerable to Communist influence.

In 1978, Kennan became a professor emeritus at the Institute for Advanced Study in Princeton, NJ. Due to his prolific writing and prominence, he got special treatment– continued to be treated like a full-time professor. Private donors such as the Rockefeller family, the Ford Foundation, the Carnegie Corporation and Warren Buffett funded his continued tenure.

Read the book to learn why Kennan was expelled from the US embassy in Moscow, of a proposal that would result in German reunification in the 1950’s, of one step Eisenhower took in deciding the Soviet question, of Kennan’s activities after his Foreign Service career, of America’s relationship with Yugoslavia’s leader Josip Broz Tito, and much more.

American Governor

The Book of the Week is “American Governor, Chris Christie’s Bridge to Redemption” by Matt Katz, published in 2016. Christie was a two-term New Jersey governor known for skillful fund-raising, telling cute stories, and verbally attacking the media, hecklers and political opponents.

In September 1962 in Newark, New Jersey, Christie was born to be a politician. He was elected to leadership roles beginning in high school. He argued for civil rights as a student-officeholder in college. But his stands on most major issues prompted him to become a Republican.

Christie entered politics after practicing law as a commercial litigator with the help of his law partner’s contacts. He started to work in politics in the early 1990’s. After 9/11, he was appointed by George W. Bush to the patronage position of U.S. Attorney (chief prosecutor) for the state of New Jersey. He lacked the criminal-law experience for it, but learned on the job.

He drained the swamp of dirty New Jersey politicians of both parties. At the same time, he was collecting goodwill by doling out multi-million dollar legal contracts to big-money political donors.

After his election to the New Jersey governorship in 2009, out of necessity, Christie was forced to work with a Democrat-controlled legislature. Otherwise, he would have gotten nothing done.

To his credit, Christie “… was a big guy who knew how to get people to sit down and shut up and compromise– just what Washington needed.” He was so good at fundraising because his staffers identified community influencers at the most local levels, and invited them to town hall meetings.

However, “The reformers, led by [Newark mayor Cory] Booker and Christie, were shockingly naive about how closing schools with little public input would upend the daily lives of Newarkers.” Christie argued or voted in favor of a series of anti-liberal policies which hurt the poor in housing, wages, heating and cooling of homes, and food stamps.

Additionally, due to the purported reason of a fiscal crisis, he “… froze almost all construction funding for the state’s poorest school districts.” (It would have killed him to raise taxes; then he wouldn’t get reelected.) This led to the cancellation of the building of a new school in the neighborhood of Lanning Square in the city of Camden. Instead of a new school, Christie’s crony would get the opportunity to construct a building for his medical school on the site, plus five privately funded schools in Camden.

Christie gave tax breaks of tens of or millions of dollars to a diverse bunch of businesses to get them to stay in his state so that they “created jobs” (and bragging rights for politicians). Over the years, those tax breaks resulted in: the creation of tens of jobs, a net dollar value of hundreds of thousands in benefits’ going to the state, and incalculable billions of dollars in lost tax revenue; showing yet again that cronyism thrived in Christie’s New Jersey.

And now, as an aside, an interesting factoid: “Christie had met Bill and Hillary Clinton in January 2005 at Donald Trump’s wedding.” And another: In January 2014, he signed the Dream Act, which (conditionally) allows children of illegal immigrants to qualify for (greatly discounted) in-state college tuition.

However, the major incident for which former Governor Christie will be remembered is “Bridgegate.” His political enemies turned out to be sufficiently aggressive to turn it into a humungous scandal.

Deliberately-created traffic congestion by a handful of people in Christie’s organization caused hours-long delays in September 2013 for five days in a row during the morning rush hour on the George Washington Bridge (GWB)– that links New Jersey and New York City. This was done for the purpose of petty, political retaliation against the mayor of a New Jersey suburb in GWB territory. That mayor had declined to endorse Christie for gubernatorial reelection.

It is a shame that Christie’s political record of unethical behavior in so many areas that ended his political career negated the one good thing he did that had long-term positive results– eliminated a significant amount of corruption in New Jersey.

The same seems to be happening with New York City mayor Bill de Blasio: the one good thing he did was institute free pre-kindergarten across the city. There is ample evidence that this is a game-changer– it helps “even the playing field” for kids of all economic and social levels. The earlier the intervention in the lives of at-risk kids, the better. Preschool is not too soon.

Research has shown that the kids who have home environments with severe deprivations, are significantly less likely become career criminals when, in very early childhood, they are provided with a safe place that provides resources to assist them in learning, and learning how to interact with other children.

However, de Blasio’s alleged wrongs in recent years in fund-raising activities and housing, both steeped in patronage (like Chris Christie’s administration) — just to name two of many issues– have earned him numerous political enemies.

Anyway, read the book to learn more about the above GWB scandal, and Christie’s fights with New Jersey’s civil service unions – especially the teachers’; how he sold out environmentally; why his approval rating soared immediately following Hurricane Sandy; his actions on a range of other issues such as drugs, abortion and gun control, and much more.