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Friday, December 30, 2011

I don’t need an alarm clock, I have a dog.

Dogs can tell time. They know when it is 5 PM, dinner time. If I get involved in something and lose track of the time, they will remind me it is 5 o’clock. If I don’t get up at 7:30 AM, they will wake me. They know when it is 7:30, and time for me to get out of bed. A large dog can wake you with a single bark, two feet from your ear. I have no idea how a dog senses time. Somehow they just learn.

Most of my dogs have been “rescue” dogs, what used to be call strays. I am careful about putting a collar on a stray dog or letting it into the fenced backyard. Sometimes these dogs have gone feral, living out of trash cans and fighting for their lives. They can be very dangerous. Without exception, they just want to belong, be part of the pack. It is my job to teach them the rules of belonging to the pack.

Cesar Millan, the dog whisperer, is one of my idols. I’ve read most of his books and faithfully watch his TV series. He talks of the importance of being the alpha dog. I’m not buying it. The dogs will work out the alpha thing among themselves. I’m a god. I’m the food god, the bath god, the medicine god. I go far beyond being an alpha dog. I open canned dog food. Doors don’t stop me.

I agree with Cesar about it being an attitude, you have to be in charge, no questions allowed. Never, ever, hit a dog. This reduces you to their level, just another animal. Train your dog by being the food god, rewarding good behavior with your favor. It always works.

I may be a god but the alpha female will still bark in my ear at 7:30 in the morning. Maybe she is telling me that my god illusion is just that, an illusion.

Thursday, December 29, 2011

Happy 2012 New Year to all

As we celebrate the start of a New Year (an entirely arbitrary calendar notation), I avoid the predictions, they are almost always wrong. I’ll stay with the scheduled events.

At the top of the list is the end of the world, the 2012 Mayan calendar ending on December 23th, two days after the 2012 winter solstice. Y2K was something of a bust; no airplanes falling from the sky, commerce did not end (That had to wait for the subprime crisis), and the electric grid did not collapse. This new event has the planet becoming a smoldering cinder just in time to save us from global warming. The good news, it doesn’t happen till December, we still get most of the year to mess up something. 

Next on the list (for Americans) is “the most important election of my life” which will take place in early November. This is the tenth “most important election of my life” and I’m starting to become suspicious of the claim. A cynic might think this just a standard line from politicians, claiming that political organizations would use emotional manipulation in place of discussion based on merit and policy. But I believe, I truly believe, a politician would never lie to us.

I’ll skip the Nostradamus Prophecies, and the start of World War III, we get these scheduled for every year, nothing new here.

Moving down the list, the discovery of the Higgs Boson, the God particle, I’ve been waiting on this for years. Is it a coincident that we discover the Higgs Boson and then the world ends?

Last on my list, The Rapture, this is the spiritually pure being directly rescued into Heaven. I’m counting on this one. I’ve bought gold. Since very few of the rich are spiritually pure, few (maybe none) will be rescued, and the rich place great value in gold, my gold holdings will skyrocket.

Remember to store plenty of food, water, canned goods, gold and Duct tape.

Happy New Year.

Wednesday, December 28, 2011

I could have been a stock trader. Part 3 (The Science of Economics)

Economic professionals claim they practice the science of economics, they are closer to being alchemist, claiming they can change lead into gold. In days of old, the aristocracy would take the last piece of food from the serfs to cover the alchemist cost. Today the aristocracy will raise taxes or prices.

Economist can be placed in two groups. One group believes capitalism is efficient and self regulating, the other group has noticed that it isn’t.

The efficient market group will not even acknowledge that we have experienced a series of boom and bust cycles. If you have a house, a 401k or you are just trying to balance the check book, this view may seem ridiculous and you may think me reporting a fairy tale. There are highly educated PhDs and politicians that hold this view as an infallible truth. They are recommending and implementing policy based on this fantasy.

The second group has noted that capitalism occasionally produces undesirable results. They have no idea why this happens, but they have at least studied real world data. Being realist they have little input to governance.

Abraham Lincoln clarified our constitution with the statement “of the people, by the people, for the people”. Many successful governments have not been of the people or by the people, but no government has lasted that was not for the people. Capitalism can create a society that is for the people. For the people requires an honest game, a level playing field, equal economic opportunity, an inclusive open to all financial system. This requires governance that dampens the destructive parts of capitalism, protects private property, and enforces law with equality.

The problems with our American government and the American financial system are easily identified. We have become a 1960s style banana republic. How to fix a system dominated by people that do not wish to fix the system is a much harder problem.

I have a few ideas.

Tuesday, December 27, 2011

I could have been a stock trader. Part 2 (Adam Smith was right)

I read a lot. The most common genre I choose is Science Fiction. I must admit that I am something of a book harlot. I’ll take a turn with any subject. I have read many economics books, the best is “Wealth of Nations”, by Adam Smith, published 1776. It is such a good book I have read it three times, first in my early twenties, again in my middle 40s, the last reading about a year back. The book runs over 1,200 pages and the language a challenge. It is incredibly boring, the concepts that I find fundamental and amazing are sprinkled among endless pages of observational data. Do not substitute a modern, updated version. I have tried a few and there is a high correlation to the editor’s political views. These are simply not the same book.

Many economic professionals and politicians refer to Adam Smith’s invisible hand, saying the market is controlled by an invisible hand which unerringly guides it to the best answer, self correcting and mystically efficient. It quickly becomes apparent they have not read his work. The precise quote is “led by an invisible hand”, page 574, second paragraph. I could include the entire paragraph showing that the modern spin is far from the original intent (Google adam smith invisible hand). Adam Smith wrote of cause and effect, interpretation of observable data. Modern economist and politicians espousing the invisible hand should title their work “Harry Potter and the magic invisible hand”. Adam Smith did not believe in magic.

Monday, December 26, 2011

I could have been a stock trader. Part 1 (You can retire rich)

I wanted to be a stock trader, for twenty years I would buy and sell stock after my day job, sometimes on my lunch hour. I am a retail trader, an individual that trades from their personal account. I dreamed of starting my day by sitting in my night clothes, lap top in hand, trading equities. With retirement I was finally able to realize my dream. I traded stocks, options, commodities, derivatives, going long or short. This was not new to me, I had been trading part time since the late 1970s, and I had a strategy, discipline, linked spread sheets for analysis. I made more money than I lost.

I quit trading after 18 months. Trading is mind numbingly boring. I still invest but I no longer follow the market all day, day after day. I had spent my career interacting with people, working on teams, managing departments. Trading is sterile, lone ranger stuff, me and my computer. Eventually, watching numbers change on a screen is not exciting, not entertaining, not even mildly interesting.

I have all the basic tools needed to select an investment based on economic fundamentals. As a manager I had learned to read financial statements, profit/loss, balance sheets, cash flows, I would often volunteer to help the company’s auditors count inventory and comb through documentation. I am comfortable reading a company’s annual report. I am willing to do my homework. I fantasized about being a stock trader. I do not have the personality to be stock trader. One more dream destroyed by reality.

I listen to politicians extolling the virtues of every American accepting responsibility for their personal financial future, investing in funds, 401Ks, and stock trading their way to millions, finally retiring to a mansion on the beach. I now realize that this is a fantasy, a dreamed of paradise never to be. Few will succeed, many will fail. We are not a nation of stock traders. We are a nation of doers.  We do not like to work in isolation. We like to work in groups.
The joy of making a killing in the market cannot compare to the joy of actually building a well crafted product.

Our system gives outsized rewards to financial practitioners, who create nothing, while demonizing a teacher that creates prized students. We have breathe-taking financial inequality that is not based on merit or social contribution. There will always be some inequality in an open competitive system, by definition some will succeed and some will fail. Our financial system is out of control, the results are bad for both America and Americans.

Thursday, December 22, 2011

Confessions of a Grinch

Christmas day is rapidly approaching and I am in full Grinch mode. Christmas being a dysfunctional inter-generational wealth transfer based on a false premise. Nice update of the bah, humbug Mr. Scrooge story. It is really just a front, I actually rather enjoy the holidays. I do have a major personality disorder that becomes obvious this time of year. I hate to shop. I hate shopping malls. I really, really hate driving this time of year. I haven’t mastered online shopping and have no emotional mechanism for selecting gifts. I do not know what a perfect gift is. My family has learned to forgive me these handicaps, and generally allows for my dysfunctional behavior. Some (but not all) of the women find my confusion and bewilderment humorous. Fortunately, my wife saves me from the most embarrassing blow back of not be capable of shopping. She goes shopping, buying gifts for grandchildren and relatives then signs my name. Without this forward guard I would most likely be forced to leave the country in shame and disgrace.

My wife goes shopping, sometimes partnering with her sisters, with a gusto I can only wonder at. What can possibly drive this behavior? Sitting home watching the football game gives me time to ponder on the mystery, it takes 3 hours to play a 60 minute game, lots of spare time to do something else. I believe that shopping for women is an ancient, deeply rooted, behavioral trait based on our need to successfully hunt. Some say, “Women just like to spend money”, this is like saying hunters just like to shoot bullets. It is not about the money, it is the thrill of the hunt. Stalking the prey (the perfect gift), finding a bargain (Minimum resource usage), and the joy of a kill (Making even the checkout line emotionally satisfying), all followed by a tribal ritual of comparing hunting skills. Then the wrapping of the prey into packages for distribution at the winter solstice, that midwinter day marking the survival of another brutal winter with hope for the spring, a time to enjoy the larder set aside.

Of course, given my total befuddlement with the concept, I could be entirely wrong. Half time is over and I have to return my attention to the football game.

Merry Christmas to all.

Saturday, December 17, 2011

A Free Market Solution for Social Security

We need a Republican free market capitalist solution for our fiscal problems with Social Security. The same approach used to save American financial corporations from 2008 through 2011 is a perfect model. The Bush administration wanted to allow the financial corporations to earn their way out of trouble. The FED loaned them about $7 trillion dollars at a low interest rate, then borrowed the money back at a high interest rate. The participant corporations are currently pulling down about $270 to $300 million a year. These are just the numbers we know about today, the sums increase with each memo leak and each news cycle.  The exact numbers are not important. It is the concept. Government guaranteed profit, pure Republican free market stuff.

The Social Security short fall is less than half this guaranteed profit, so about a $3.5 trillion loan will more than balance the books.

Making this even more of a shining-city-on-the-hill model of free market capitalism, something to make the entire free world stand in awe and astonishment. We could randomly select about a half dozen social security recipients to split up a $100 million in bonuses. Give them titles such as CEO, COO, CFO, OMG, LOL, etc, and we get the added social benefit of having new job creators.

Being a partisan Republican free market capitalist solution, the Democrats will have some complaint, maybe asking that the CEOs forfeit their $13,200 annual social security benefit. This is an obvious tax increase on job creators and class warfare. Stand your ground Republicans, the Democrats will crater, as always.

Wednesday, December 14, 2011

The toilet paper mystery

In my twenties I was called out by a young lady friend.  The toilet paper had run out. I replaced the roll. She later told me that I had placed the roll on backwards. I don’t remember which way I installed the toilet paper and our ships parted ways before she could explain the correct orientation of a toilet paper roll.

Since then I have had innumerable hours to observe and contemplate this mystery. Should the toilet paper dispense from the front or the back? The mystery deepens when I have occasion to observe the professional toilet paper dispensers in public rest areas. These are large rolls that rotate clockwise or counter clockwise inside large metal housings. The housing has a lock. I can understand optimization of toilet paper usage in areas utilized by hundreds of people, the dollar savings would flush straight to the bottom line. But, a lock? Toilet paper theft is a threat to corporations? Does the roll unwind clockwise or counter clockwise, is the answer opposite south of the equator?

Why is the professional industrial grade toilet paper housing locked? The additional cost and maintenance would reduce shareholder value and stock price. Is there something else inside the metal housing? I see many people carrying reading materials into these stalls, hidden from public view, are the metal containers being used for valuable secrets, perhaps used by professional spies to hide something in plain sight?

After decades of research and deep thought I have not been able to crack this one.  Do you know?

Sunday, December 11, 2011

What Newt taught me

We usually spend Saturday evenings at home. My wife and I go out for any early dinner and then back to the house. She calls it a date, I call it $40.00. We partied hard into our middle 40s, then just started staying home. We both read a lot, but last night decided to live wild and watched the Republican debate. I wish that I had finished my latest book instead, but, we all make mistakes. I hope you don’t hold this against me. I wish to be judged on the person I am today, not the person I could have been yesterday.

Newt Gingrich was in full professorial mode. Pedantic and authoritarian, the sum of all mankind’s knowledge, I took some classes under professors like Newt. I don’t remember much of whatever subject they were teaching, however there are two important lessons that this type of professor taught me.

1.        1) If you want a passing grade, don’t ask questions.
2.        2) Any time you think “What a load of bull”, say brilliant.

These lessons proved important and useful over my entire career. They are perfect for dealing with a fact challenged boss, and coworkers with a bloated sense of self importance. The second lesson was crucial as I climbed my way into senior management.

I left the Democratic Party to become a “Reagan Democrat”, quit the Republican party during Bush 2 (I feel that Bush Sr. was a very good president), didn’t last very long with the Tea Party and haven’t been able to figure out where the Houston OWS folks are meeting. Guess this makes me one of the “all important independents”. I don’t know where the “independents” are meeting either.

Friday, December 9, 2011

Winter Hammock almost ready.

My hammock is lake side with Elm and Ash trees, Cedar and the occasional birch, mixes of Saint Augustine and Bermuda grass with clumps of Johnson grass and weeds I can’t name which run down to the clay and gravel beach. Squirrels are taunting my dogs, the squirrels have learned that two or three can lure the dogs into the trees, the remaining dozen or so squirrels then clean out the dog bowl. Do the squirrels take turns, all getting an equal share of dog food? I’m going spend the next several weeks observing the action, and then I’ll get back to you.

Placing of the hammock requires care. Before hanging the bag I walk the selected area, imagining the view. Do I want the lake to dominate? Perhaps the forest? Maybe my neighbor’s backyard? She has a really nice backyard, with a nonfunctional old style Texas wind mill. She is a bird affectionado, and the yard contains bird feeders, bird bath, nesting boxes and hummingbird stations. The dogs are on constant patrol for cats (and squirrels), making the entire setup very avian friendly. I decide on tying off hooks in different locations, this will allow for an easy, quick change of view. For now, with book in hand, the background is the lake and shore line.

In a hammock you are exposed to the environment top, bottom, right and left. Today’s high was in the middle 50s, cooler than usual for Lake Conroe Texas. A sleeping bag solves this minor inconvenience.

With sunset the temperature drops like the breath of winter blowing off an ice field. I go inside and light the fireplace logs, then go online and start shopping for a thicker sleeping bag.

Thursday, December 8, 2011

Boiling Frogs 2

My first ever post was about the boiling frog myth. Since then I have learned to write shorter post. For a much longer and more detailed discussion about boiling frogs reference my post of December 2.

The myth is that a frog will allow itself to be boiled alive when heat is slowly applied. We are all frogs being slowly boiled alive. What is boiling us? Select something that frightens you.

Government debt, check.
Socialization of medicine, check.
Illegal Islamic Mexican terrorist drug lords, check.
Spotted owls, check.
Global warming, check.
Have a little fun and make your own list.

This myth is a general purpose tool of politics. It can be used to gather monetary contributions, prove the politician’s deep concern for you personally, show their political opponents are willing pawns of the devil, in the hands of a skilled politician this is a powerful metaphor.

The myth is factually false. A frog will not be boiled voluntarily and neither will people. Our dysfunctional political system is incapable of even obvious corrections. It is only capable of increasing the heat, boiling the water.

Our electoral choices are between dumb and dumber, the least bad, who will cause the smallest damage. The last time I remember the selections being this bad was Hubert Humphery and Richard Nixon. The election of Richard Nixon was a turning point for our society. We have been in a downward spiral ever since 1970.

Choosing between bad and worse never ends well, we need to change the system so we can chose between good and better.

The change will be a long, slow process. More of the 99% become more dissatisfied each day, thinking about what was lost from yesterday and what could be tomorrow. The start of change begins with thinking.

Wednesday, December 7, 2011

Advice for today’s generation.

The Greatest Generation (They won WW2, defeated communism, and took only 20 years to create the American century) taught me to be responsible, hard working, financially responsible, and learn a trade. Get married, start a family, buy a house, live in the house for 30 years paying off the mortgage. Take pride in your workmanship, live with honor, and be honest. Retirement will be my golden years.

There must have been some secret Mom forgot to tell me, I followed all these guidelines and retirement is bronze plated scrap iron.

Now it is my turn to give advice to the younger generation. Be responsible, learn a trade, become proficient at contract review, a master of financial engineering, knowledgeable of tax law, most importantly become a medical expert. Being a medical expert is critical, you can get everything right and one medical disaster will put you before the bankruptcy judge. You must be able to perform a kidney transplant at home with kitchen utensils.

Become an expert marksman and martial arts sensei. Right now millions of Islamic terrorist are swimming the Atlantic Ocean with AK-47s clenched in their teeth. They’ll be coming ashore at Miami Beach any day. Wild eyed bearded men shouting “Death to America”. Take personal responsibility and be afraid, be very afraid.

The future is now your responsibility. A hand full of people in my generation sold everything to China, took the money and slipped out of the country.

Best of luck kids.

Tuesday, December 6, 2011

Lies, damn lies and then there is statistics

There are lies, damn lies and then, there are statistics. If I had received $100,000 every time I heard this, I’d be rich today. As a retired professional statistical analysis, having worked for large capitalist corporations, I took this fiction as a personal affront. It is time to set the story straight.
To prove the validly of statistical prediction, I under took a rigorous, scientifically sound analysis of flipping coins. To insure a valid study, a large number of trials needed to be studied (The Law of Large Numbers*). Using a team of trained professionals to supervise the volunteers, we flipped 10 billion coins. To avoid any possible selection bias*, a random assortment of coins were employed and no single coin was used more than once. To avoid physical bias* half of the volunteers were left handed and half right handed. The person selecting the coin was blind folded and the person flipping the coin was also blind folded (Double Blind Test **). The result of the flip was recorded by robotic vision recognition hardware (no human participate was allowed to observe the coin to remove possible Human bias*), and then all results were electronically transmitted to a secret CIA data base.
The results were mathematically computed using software designed by MIT professors and double checked by professors from The University of Heidelberg. All supervised by the Lucasian Chair of Mathematics at Cambridge University.
The results are indisputable. 50% heads with 50% tails, the average coin toss will land on its edge and balance there. I can safely predict that any future coin toss will land on edge, and balance there, being half head and half tail.
This Schrodinger coin toss state, where the coin is simultaneously head and tail, exist as long as you do not look at the coin. Proving that statistical claims are true, providing that you do not look.
This hard science approach validates those statistics you will hear on cable news shows. I don’t wish to hear anymore foolishness about statistics being falsely used to prove some unsupportable ideological claim.

* Terms of art for people who like to Google stuff.
** OK, this isn’t really a double blind test, but, if this was an op-ed in the Wall Street Journal it would fly.

Sunday, December 4, 2011

From a hammock on a Caribbean beach

The hammock is the most comfortable way to read a book. It is more comfortable than any mattress or lazy boy chair. This week’s hammock is 40 feet from the Caribbean Sea, about 200 feet in front of the edge of a tropical rain forest and shaded by palm trees. Colorful tropical birds, and sea birds floating on the wind currents hunting their daily meal or just loafing about. Half Moon bay in Akumal is calm today, the surf gentle on the white sands of the beach. The tourist season starts soon and locals are busy painting the buildings, cleaning the beach, bringing in supplies and completing last minute repairs.
I watch a couple with snorkel gear wade into the water then slip into the waves, heading out to the reef less than a hundred feet from shore. It occurs to me that I don’t know what day it is, and then decide it doesn’t matter. I am here, it is now. I go back to reading my book.
At night the stars are visible in vast numbers, there is no light pollution and the sky is crystal clear. In a hammock you don’t have to look up, you just lay there. Orion dominates the night sky, the star Betelgeuse is bright, red, pulsing, it is easy to image it shedding vast amounts of its outer surface, solar flares that stream across the sky, pulsing in size. The occasional meteorite flashes across the sky, the surf creates a white noise that gently puts me to sleep.
Predawn light wakes me up. I make a cup of coffee and wait for dawn. Just before the sun rises over Half Moon bay the lower sky goes to a deep violet blue, a transient event lasting only minutes, fading to a normal sky blue as the sun rises.
It is a start of another day, whatever day it is.

Saturday, December 3, 2011

Fixing the Government with Business Practices

A generation ago America was the leader in most measures of societal success. Today we rate low on education, wealth distribution, private property rights, democratic governance, social mobility, we even lag in patent applications and patents granted. We are hard pressed to find any positive criteria in which America still leads.

I often hear that we need to use business models to fix our government. This makes a great bumper sticker and government by bumper sticker is certainly a good idea. Let’s step through some business approaches for solving government problems.

The tool kit used to fix problems has been sharpened over centuries of continuing effort. Among the better tools used are failure analysis, root cause, “best practice”, statistical six sigma, and LEAN. This just touches some of the tools available. All of these approaches simply ask why in an overly complicated manner.

Let’s start with failure analysis as used by modern business. Start by finding someone to blame, preferentially someone without the power to argue, this is good CYA and well done enhances your career. Next you advocate for a promotion and pay raise so you have the authority to fix the problem. If you are really good now you can start to fix the problem, if you are not that good, hire someone who is as a subordinate.

Now for a working example using the 5 whys and root cause. The plane crashed. Why? Pilot error. If the pilot is dead you’re home free. Explain that with more engineers and a higher position you can build a safer plane that reduces pilot error. After your promotion and a short hiring frenzy, you ask why did the plane crash? The wing fell off. Why did the wing fall off? The spar separated. Why did the spar separate? A bolt failed in stress. Why did the bolt fail in stress? The bolt was counterfeit and did not meet the required physical properties. Why was a counterfeit bolt used? We have no method to validate purchased components. At this point another sacrificial lamb becomes available. You get the procurement manager dismissed and take over his department to ensure engineering quality compliance. Continue to ask why, and continue to take all opportunities that present themselves. Eventually you find the root cause and develop a process that ensures parts and assembly that is 99.999999% accurate. This is called a six nines program, never offer 100%, which would be an unacceptable career risk. Politicians are certainly expert at blaming innocent victims, which covers the first step. Our system of government is incapable of the “drilling down” to the root cause, the answers would be too uncomfortable and possibly too dull for good cable television. Ok, root cause analysis is out.

Next we will look at best practices. Why is America falling behind relative to our peer nations? First we blame someone, the politicians are professionals at this and I will not attempt to complete with them. Pick your personal favorite from the offerings available and we will move on.

Since this is a business exercise, turn the question around and ask why are other nations doing better? Now we can use “best practices” to find a solution. Politicians talk of “American Exceptionalism”, since we are the “best practice” this problem solving tool is unavailable. Any politician making a statement such as “France has a better (insert favorite social problem here) we need to study their methods” would be shredded by Fox news and tossed out of office the next election cycle. Too bad, “best practices” is a very successful tool used in all the leading companies. One of the methods for emulating the competitor’s advantage is to hire the manager of that business segment that is beating your butt. I was at a small company that developed a more efficient manufacturing method for drill bits. A competitor hired my entire department. We came with the “best practice” and ideas to improve it. Unfortunately, I cannot imagine American politicians hiring a Swedish bureaucrat. OK, “best practices” is out.

Let’s next turn to Six Sigma and LEAN. Six Sigma is a statistical approach and works best with large numbers, our government certainly has large numbers. LEAN is used locally to reduce waste and improve delivery of the department’s service. This could be used for a driver’s license bureau.

For Six Sigma you need a trained cadre of “black belts” and “green belts” to identify the process’s economic outputs and then remove any causes of defects and variability. This has great promise for governmental application since it starts by creating a new bureaucracy, there could even be a Presidential secretary of Six Sigma, sitting right next to the white house military Chief of Staff. Six Sigma only identifies problems, fixing problems falls on LEAN. Since Six Sigma points the finger with mathematical precision this will fit very well for politicians, maybe this is a successful business practice that can be used in government.

With Six Sigma entire departments can be wiped out as economic externalities. Since the Department of Education provides no economic profit it is wasted resources. The entire government can be disbanded with this logic. This looks promising.

If there is some government function you wish to retain then LEAN will be required to correct any identified process defects. LEAN is a quality management tool and has a long history, starting with Henry Ford, moving to Japan and Toyota and returning to America and then on to Europe. This is a highly refine and successful tool. I have personally used LEAN to accomplish phenomenal results, 1,000% increase in output with zero defects, all without increasing employee head count. You can look up the LEAN tools, such as the 6 s program and kanban, however the basis of LEAN success is called WIIFM (what’s in it for me). No one knows how to do a specific task better than the person doing that task. In economics this is called the “agent problem”. After an inefficacy or quality problem has been identified by six sigma, the LEAN professional assembles a team of the people responsible for the specific task. In manufacturing I would include the purchasing agent that buys the raw stock, the machinist that forms the finished product, the quality inspector that checks the product and the engineer that designed the product. I consulted for a short period with a company where senior management was using six sigma and lean to reduce headcount. I did one six sigma and two lean projects then recommended another consultant to replace me. The company continued to lose market share and money. WIIFM, the agent problem, doomed the company. Once the employees figured out that a successful project would mean losing their job, there were no more successful projects. In this case “what’s in it for me” is getting fired.

I have attended one online meeting with a national politician singing the praises of six sigma and LEAN to manage government. I was not part of the discussion and only listened. This politician’s objective is to reduce headcount, failure is inevitable.

We have examined failure analysis, “best practices”, and six sigma with LEAN for usage by our government. None will work. The basic problem is that the political system does not wish to be fixed. The political participants are very comfortable with the current process. Under the current system “what’s in it for me” for the politician are power, money and fame. What needs to be fixed?

It is possible to use these techniques in government. Singapore is a good example of a government using best practices, China uses root cause, Germany has competent leadership. You have to go where the data leads you, American politicians have this backwards, they start with the answer they wish, and then find data to fit.

How do we fix the American political system? Replace the clown parade with some competent and realistic leaders.

Friday, December 2, 2011

Boiling Frogs

The myth about boiling frogs seems to be widely accepted. I was told this myth at age 13. A frog will allow itself to be boiled alive if the heat is slowly applied. I remember being first amazed, and then obsessed with the story. In 1960 frogs where common and easy for a teenage boy to catch. With my best friend, Tommy, we set out to test the story. The first problem is that a frog will not voluntarily stay confined in a pot at any temperature, we had to construct a terrarium with mostly water, provide a food source and wait for the frogs to settle down to a easy life in  captivity.
Frogs do try to escape as the water is heated, even when heated very slowly. I have always liked animals of all kinds so the frogs were released after they displayed obvious distress and the story disproved. I filed this story with all the other stories adults tell children. Santa Claus, not true, Easter bunny, not true, tooth fairy, not true, boiling frogs, not true, the list just grew longer with each passing year and I was starting my journey to full skepticism.
I was told the story several times over many years by people who should have know better. By college I had most of the story correct. Wikipedia, as usual, has the complete frog story well documented, http://en.wikipedia.org/wiki/Boiling_frog Wikipedia was not available during my long undergraduate years and an engineering professor completed the frog story for me. I did have a literature professor who appeared to believe this myth, and when questioned, she related that it is a useful metaphor.
How can a metaphor that is factually wrong be useful? Why do so many adults believe this myth when a teenage boy will question the myth? There is at least one potential candidate for the American Presidency that thinks this myth true, or at least, a useful metaphor. There are well educated editorial writers that relate the story in major newspapers and on political cable television programs.
The story goes like this. We are slowly losing our greatness, our morality, our superiority, our laws and culture. Politicians and political commentators have been using this story line forever. We find the same speeches from the Roman Empire to present day. Charlemagne’s writing is the same as Newt Gingrich’s.  My question is not about a factually incorrect metaphor. It is the lack of originality.
Human nature, those psychological characteristics and behavioral traits that set us apart from all other animals, is unchanged over the 8,000 years of written languages. I would guess that it has not changed since we were hunter gatherers more than 10,000 years pass. Our human nature distilled out of evolutionary forces over millions of years. Human nature then created our various religions, myths and cultures, our cultures then created our politics.
Modern American politicians differ none from the Roman patrician, current Wall Street bankers have no more greed than the Savings and Loan greed of the 1970’s. The self serving rationalities, the misdirection and misinformation, the hidden agendas are modern translations of Niccolo Machiavelli.
That there is large and wide spread dissatisfaction in the American population, which is growing, is evident in first the Tea Party movement and now the Occupy Wall Street movement. The larger political structure successfully compromised and then incorporated the Tea Party, now the establishment is trying to marginalize and delegitimize the OWS. Failing this the next step will be to assimilate the movement. Another pattern unchanged since Rome ruled.
There has been progress. Roman dissidents could be slaughter in mass by the Emperor. America today could not even arrest large numbers of dissidents without considerable political blow back.
What is desired is a fair system, currently the playing field is heavily tilted, the dice loaded, the card deck stacked. Corporations have greater rights than I have, insiders can legally conduct business I would be arrested for. Public money is gambled for private gain, a “too large to fail” institution gets all the profit if it wins the bet, I get all the loss when it losses the bet.
The game has never been fair, utopian dreams can never be completed and certainly not implemented. What I see in the drift of history is that a more even playing field creates a stronger society. The clearest example is when governments moved from the feudal monarchies to representative government with capitalism. In feudalism the King owned everything and would take the last food from a serf child, the child would likely die and there is no more income for the King. With political representation and capitalism the King could not take the last bit of food. The King could now tax some of the freeman’s property, generating more income for the government and a continuing government income. Both the elite and the general masses were healthier and wealthier. The King had more money for war and a source of healthier soldiers. Those governments that became more equalitarian fielded larger, better equipped and motivated armies. The old system lost on the field of battle.
A frog will not be boiled voluntarily and neither will people. The current American political parties have become dysfunctional, incapable of even obvious corrections. All they seem cable of is increasing the heat, boiling the water.  If OWS does get neutralized another populist movement will start, and another, and another.
We will never have a completely fair system, but we can certainly do better than this.