The Silent War

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The Book of the Week is “The Silent War, Inside the Global Business Battles Shaping America’s Future” by Ira Magaziner and Mark Patinkin, published in 1989. When Magaziner worked for Boston Consulting Group, he would conduct extensive research on industries, markets, businesses and people in order to generate reports that would presumably help his clients (consisting of big-name companies). He argued that America was economically falling behind the rest of the world because it was resisting global trade and because its federal government wasn’t financially assisting business and industry.

One time, in the mid-1970’s, Magaziner’s report’s conclusions contradicted those of his client, a big steel mill company. He asked where the executives got their information. Each one’s source material, “… was all the same– all based on one original study done a few years earlier by some professors.” The executives’ groupthink and herd mentality in relying on old, faulty data led to financial trouble for their industry.

In another case, in the late 1970’s, when General Electric partnered with Samsung to make microwave ovens, they struggled to arrive at the most profitable arrangement for both of them. One major cultural difference was that the South Koreans (unlike the Americans) worked sixty to eighty hour weeks because they believed in making sacrifices for future generations. Incidentally, they sent their children to universities in the United States to be educated, and taught them the value of hard work.

Obviously, Americans too, wanted better for their children, but their labor unions and a different mentality prevailed in their workforce. South Korea eventually became an economic powerhouse, not just with the help of American financial aid, but also through maximizing its exporting of goods.

In the 1960’s and thereafter, Singapore’s leader, Lee Kuan Yew, tried a few different territory-wide economic initiatives that failed. One included legislating a 10% wage increase for all workers. Foreign companies, with all the then-availability of sweatshop labor, simply moved their factories to Thailand and Malaysia, where workers were paid less so that goods could be produced more cheaply.

One successful economic program Yew executed was to train his citizens’ factory workers in connection with an Apple-Computer partnership in the 1980’s. The workers made the sacrifices to attend night-school (tuition-free) after a long day’s work two to three times a week, for two to three years. The benefit for the partnership was that the workers’ experience allowed them to submit innovative ideas to improve manufacturing efficiency. Again, in the United States at that time, labor unions discouraged new ideas lest workers automate themselves out of jobs. Which happened to them, anyway. But the non-unionized Singaporean workplace was such that workers weren’t laid off– they were retrained for higher-level positions.

Yet another reason the United States began to economically trail the rest of the world in the latter half of the twentieth century, was that its securities markets accelerated impatience in America’s corporate psyche. American industry became unwilling to finance and do the hard work of, continuing research and development and take a loss in bad times to keep pace technologically with Asian competitors. It wanted to prop up stock prices instead and make its executives rich quick. Still does.

One company that bucked the trend was Corning. In late 1983, (finally, after sixteen years of losses!) it had the cutting-edge technology in fiber-optics for telecommunications, ready to deliver finished products to its first big customer, MCI, to turn a profit. Corning did it on its own– receiving scant financial help from the United States government.

Times have changed little since the 1980’s, when photovoltaic scientist Paul Maycock remarked, “I hated the whole concept of buying oil from the Persian Gulf and spending $50 billion a year defending that part of the world.” He wasted a lot of time and effort on environmentally-friendly business initiatives. Sadly, those were incompatible with the United States’ strategic interests. The start of the Reagan Era saw the Department of Energy nix further funding for solar-technology research. The solar panels (installed during the Carter administration) on the White House roof were removed.

Further, since in the 1990’s (after the book’s writing) there has arisen an orgy of patent litigation in software and computer hardware. Technologically inexperienced patent clerks and court personnel have made legal decisions that have been economically damaging to the country. Additionally, the American government has a history of eagerly funding innovations that have military applications while denying funding for innovations that have commercial applications.

And yet, astute perpetrators of American foreign policy have damaged other nations’ economies not only by waging war, but also through dispensing bad advice on “shock capitalism” and other subtle (“classified”) methods of indirectly causing mass destruction. So the United States remains the economically dominant nation in the world, despite suffering its share of financial crashes and certain sectors’ damaging policies that weaken it economically as a whole; sectors such as healthcare and education.

Anyway, read the book to learn: of additional business cases that related to the aforesaid themes, and the four major reasons the Japanese technology sector achieved great success in the past.

Pity the Billionaire

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“It is as though the frightening news of recent years has driven them into a defensiveness so extreme that they feel they must either deify the system that failed or lose it altogether.”

No, not the Republican Party in connection with Donald Trump.

The Republican Party in connection with Republican voters’ gullibility in believing the Right’s propaganda machine that rationalized away Wall Street’s unmitigated hubris and unconscionable greed amid the subprime mortgage crisis of 2008-2009. As is well known, the rich were made richer and poor, poorer in the second half of the single-digit 2000’s. The GOP’s clever aftermath-messaging led to big wins for them in the 2010 midterm elections.

The Book of the Week is “Pity the Billionaire, The Hard-Times Swindle and the Unlikely Comeback of the Right” by Thomas Frank, published in 2012. This short volume described how the political group called the Tea Party (“TP”), a subset of the GOP, whipped an alarmingly high number of Republican voters into a hysterical rage against the Obama administration’s handling of bailouts of financial institutions and foreclosed-upon ex-homeowners.

It appeared to be counterintuitive, that the TP raged against bailouts for bankers, brokers and lenders. After all, taxpayers were forced to reward these greedy perpetrators of the economic disaster. Through flawed reasoning, though, the TP propagandized that capitalism should be free of any and all economic intervention from the government, whether in the form of regulation or assistance. They pretended to be an enemy of big business, screaming “Socialism!!!” at the government’s every move. They did this because the resulting continued excessive deregulation would make Republicans wealthier and more powerful, and each trait would feed on the other ad infinitum. As ought to be well known– politics cannot be divorced from economics.

The TP was really pushing for 100% pure, capitalistic Libertarianism. Under the “you have two cows” scenario (look this up on the Web): you can do with the cows whatever you wish, whenever, wherever. Also, remove: ALL regulation from all aspects of American life, taxation and social safety nets. And to make the situation truly American, throw firearms into the mix and see what happens. Absent rule-of-law, sanity and civility, the resulting ruthlessness would evolve into (judging from the federal-level administrations’ gyrations of the most recent thirty years) a dictatorial kleptocracy (sort of like Zaire (aka Congo) in the 1980’s), and then anarchy, not unlike… Somalia (?)

Fortunately, a sufficient number of Americans– despite most politicians’ cronyism with big-money donors– clung to the country’s democratic underpinnings (reasonable regulation, taxation with representation, and social safety nets) to weather the storm. The author harshly criticized Obama and his Democratic party for not punishing the morally bankrupt financiers and enforcing the law in helping the bankrupted borrowers. It is possible the president felt it was worth selling his soul to those big-money donors; he wouldn’t have been reelected otherwise and wouldn’t have been able to accomplish more of his agenda. His Democratic party, too, was too nice to get down in the gutter and use the GOP’s sleazy propaganda techniques.

Anyway, read the book to learn of how the pronouncements of the TP and Glen Beck and the contents of Ayn Rand’s novel Atlas Shrugged influenced numerous voters in 2010, and other reasons the nation’s political history unfolded the way it did in the early 2000’s.

Open Skies – BONUS POST

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The Bonus Book of the Week is “Open Skies, My Life as Afghanistan’s First Female Pilot” by Niloofar Rahmani with Adam Sikes, published in 2021.

Born in December 1991 in Afghanistan, the author deserves major bragging rights. For, she possessed the courage to serve as a liberated female role model (given her culture) by risking her own life and her family members’ lives in serving her beloved homeland. She joined the air force in December 2010. According to the book (which appeared to be credible although it lacked Notes, Sources, References, or Bibliography and an index) this was at a time when the Americans and NATO were running the show.

The Taliban and other devout Muslims were less than thrilled that she was the first Afghan female ever to learn to fly a fixed-wing aircraft. Pursuant to the Koran, a female’s priorities were: submissive girlhood, wifehood, motherhood, and womanhood (and usually, the first three were forced on females simultaneously), and taking care of a household; only then, might she work outside the home if her oldest living male relative allowed her to.

The author spent her early childhood in a refugee camp in Pakistan. Anomalously, but fortunately for her, both of her parents believed in educating her and her siblings (mostly sisters), and encouraging them to pursue the career of their choice. The family eventually moved to Kabul. Unsurprisingly, the author’s career choice provoked angry reactions from the male-dominated air force and males in her country. The most fanatical ones began to smear, spy on, and threaten her and her family.

Nevertheless, the author’s parents martyred themselves in so many ways for their children’s futures. Her father continued to encourage the author to keep flying, even when her family was under siege and suffering many hardships due to her focusing on her dream job.

A barbaric incident that occurred in March 2015 was just one indicator that in Afghanistan, the tide was turning toward the dark side yet again: a huge flash-mob of outraged, radical Muslim men tortured and killed a devout Muslim woman wrongly accused of burning the Koran.

The victim was set upon because a mullah (a credible, influential religious leader) was her accuser. Just a few of the vicious untruths spread about her were that she was a prostitute, a blasphemer of Islam, and was an agitator sent by the Americans (perceived as the evil occupiers). The author herself was subjected to roughly equivalent, ugly utterances.

Read the book to learn how the author cheated death in this wordy, redundant yet suspenseful volume.

Car Wars – BONUS POST

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The Bonus Book of the Week is “Car Wars, The Rise, the Fall, and the Resurgence of the Electric Car” by John J. Fialka, published in 2015. This volume provided a brief history of how manufacturing and sales of renewable-energy vehicles has been evolving in the last few decades. Clearly, the author wrote about relevant subjects from documents, and people to which he had easy access.

The (lazy?) author dismissed the electric cars of the late 1800’s in two sentences, saying they were obsolesced by 1920 via an innovation by engineer Charles Kettering; an electric ignition system replaced a burdensome hand crank in gas-powered cars, especially in the Cadillac of 1912, and then just like that, everyone started buying gas-powered cars. A propaganda war, profiteering and politics likely played a role in that major development in standard-setting in transportation, but the reader wouldn’t learn that from this book.

Anyway, in the 1980’s, previously competing automakers were initially compelled to form alliances to comply with car-emissions limits and meet deadlines set by U.S. laws, especially in the state of California. They shared info on electric vehicle (EV) technology. Over the years, when the deadlines were relaxed by pro-business politicians, the automakers parted ways, and independently pursued only the specific projects they felt would be profitable. Environment be damned.

In 1990, near the campus of the California Institute of Technology, when drivers tested the plug-in recharging feature of the General Motors Impact in their personal garages, their neighbors’ garage doors and TV sets went crazy, because the recharger was actually a huge radio transmitter.

In October 1995, Japan’s Toyota beat American carmakers to the punch when it showed off its hybrid Prius, that got 70 miles per gallon of gas. Of course Japan, of all the industrialized countries in the world, is significantly more motivated to seek efficient, renewable energy sources for its transportation modes– for the sake of its economic survival.

In the late 1990’s in a few select places in California and Arizona, super-rich males leased the first few models of EVs, because the cars had the attractive features of fast acceleration and high velocity; high gas mileage was a secondary benefit.

Meanwhile, in the single-digit 2000’s, a group named the California Fuel Cell Partnership was formed. It consisted of Geoffrey Ballard, Daimler, and Ford, who were working on a competing vehicle that uses fuel cells– whose mechanical components chemically alter water molecules. The selling points for those cars, once the technology’s commercial application is perfected, include: zero-emissions and the ability to fill up the car at existing gas stations. However, oil companies would supply hydrogen tanks.

Read the book to learn some of the politics, economics, entrepreneurs and technologies involved in developing cars that ran on renewable-energy sources, up until the book’s writing.