Thursday, September 07, 2006

Today is David Packard's birthday, he was born in 1912.

He and his business partner Hewitt were the ultimate entrepreneurs, taking Hewitt-Packard from garage to Fortune 500. The key to their growth, most agree, was the HP Way of treating employees.

They were criticized for the HP Way in the beginning. This is from a very interesting article about them in the newsletter of their Alma Mater, Stanford:

“Somehow, we got into a discussion of the responsibility of management,” Packard later told Peninsula journalist and historian Ward Winslow, ’52. “Holden made the point that management’s responsibility is to the shareholders -- that’s the end of it. And I objected. I said, ‘I think you’re absolutely wrong. Management has a responsibility to its employees, it has a responsibility to its customers, it has a responsibility to the community at large.’ And they almost laughed me out of the room.”

http://www.stanfordalumni.org/news/magazine/1998/julaug/articles/founding_fathers/founding_fathers.html

I wonder what David Packard would think of HP today.

Scott Shires, owner of the Campaign Compliance Center www.campaigncompliancecenter.com spoke to our South Denver Optimist Club yesterday.

Shires told us that 10 wealthy individuals are controlling the political process in Colorado. Today most votes are cast through absentee ballots, so this fall the elections will be decided by October 15. No wonder the grassroots is dieing! Grass roots get out the vote efforts on election day are now nearly useless.

Scott suggests changes to restore the power of the common person: 1) return to voting on one day (Scott suggests April 16, when the sting of paying taxes is fresh) and 2)return to all money going through candidate committees with full disclosure, eliminate the friends of the rich, the special committees that allow then to spend as they please, the "Small" donar committees, the issue committees that push through the pet projects of the powerful, and the 527 committees.

I wonder if it is time for a constitutional convention in Colorado?

This article appeared in this morning's paper. What do you think? Is there a growing problem with the difference in pay between the rich and the poor in this country? This is probably the most important economic question we face in America today. What is the truth?

The Populist Myths on Income Inequality
By DAVID BROOKS
The New York Times, September 7, 2006

There are two schools of thought on income inequality. Members of the first school — populist politicians and a few economists — say the key issue is economic power.

The haves exercise more power over the have-nots. As a result, corporate profits soar, while wages stagnate. Money-drenched politicians push through shareholder-friendly trade deals that outsource American jobs while job insecurity skyrockets. C.E.O.’s get absurd salaries while the 99 percent of earners enjoy few benefits from productivity gains. Unions are weakened while manufacturing wages tumble and the middle class suffers.

In short, populists argue, the market is broken. The rules are rigged. The reigning ideology in Washington must be upended. Unions must be revived. Globalization needs to be reorganized.

The problem with this narrative is that it doesn’t really fit the facts. First, workers over all are not getting a smaller slice of the pie. Wages and benefits have made up roughly the same share of G.D.P. for 50 years. Second, offshore outsourcing is not decimating employment. According to the Bureau of Labor Statistics, outsourcing is responsible for 1.9 percent of layoffs, and the efficiencies it produces create more jobs at better wages than the ones destroyed.

Third, jobs are not more insecure. Workers are just as likely to hold a job for 20 years as they were in 1969. Fourth, workers are not stuck in dead-end jobs. Social mobility is roughly where it was a generation ago.

Fifth, declining unionization has not been the driving force behind inequality. David Card of the University of California, Berkeley, has estimated that de-unionization explains between 10 and 20 percent of the rise in inequality, and that effect was probably strongest decades ago. These days the working class is not falling behind the middle or upper-middle class. Instead, the big rise in inequality is within the office parks, among people who were never unionized. Middle managers are falling behind top executives.

The populists, who usually live in university towns, paint a portrait of unrelieved misery that badly distorts reality. It’s true that middle-class wages are lagging, but as Stephen Rose points out in The American Prospect, over the past 25 years the share of working-age adults in households making over $100,000 has risen by 13 percent while the share of households making less than $75,000 has dropped by 14 percent — after adjusting for inflation. The median household income of people in their prime working years (25-59) is $63,000. More than half of Americans have no credit card debt, and half of those who do owe less than $2,200.

Workers continue to see their wages rise as they age. The typical male worker with some college but no degree has seen his income rise from $34,000 in 2000 to about $40,000 today.

Members of the second and much more persuasive school of thought on inequality say the key issue is skills. Lawrence Katz, formerly of the Clinton administration, now of Harvard, puts it this way: Across many nations, the market increasingly rewards people with high social and customer-service skills.

A contractor who can work with customers, design kitchens and organize jobs may earn five times as much as one of his workers who has identical cabinetry skills. An office worker who is creative, charismatic and really good in fast-changing interactive settings now gets paid much more than a disciplined middle manager who excels at routine tasks.

Katz describes a polarized economy. Wages are rising in the bottom quartile for workers who provide personal services. The middle is lagging. The real rewards are going to the top 10 percent, especially to those relative few who have the skills to transform organizations from the top.

In other words, the market isn’t broken; the meritocracy is working almost too well. It’s rewarding people based on individual talents. Higher education pays off because it provides technical knowledge and because it screens out people who are not organized, self-motivated and socially adept. But even among people with identical education levels, inequality is widening as the economy favors certain abilities.

In short, government policy is not driving inequality and wage stagnation. But government hasn’t done much to effectively address the problem either, even though per-capita education spending has more than quadrupled since 1950. What’s needed is not a populist revolt, which would make everything worse, but a second generation of human capital policies, designed for people as they actually are, to help them get the intangible skills the economy rewards.

What would a set of second-generation human capital policies look like? I’ll come back to that in a few days.

Wednesday, September 06, 2006

Free online chat with successful entrepreneur.

WHO: Warren Brown, owner of CakeLove Bakery and Love Café, in Washington, D.C.,will host the September Web chat on “Entrepreneurship: The Essentials for Starting a Small Business,” and share his phenomenal story of leaving the law profession to open a thriving bakery. Join him for an online dialogue about his journey from lawyer to entrepreneur, and about his small business expertise.

Brown is winner of the SBA’s 2006 Small Business Person of the Year for the Washington, D.C. area, and is host of the Food Network’s Sugar Rush. In 2000, Brown left his career practicing law and founded CakeLove.

WHAT: The SBA’s live Web chat series provides business owners the
opportunity to have conversations about relevant business issues with industry leaders and successful entrepreneurs. Participants have direct, real-time access to the Web chats via questions they submit online in advance and during the session, with instant answers.

WHEN: Thursday, September 14, 2006, from 1 p.m. to 2 p.m., EDT. Brown will answer questions for one hour.

HOW: Participants can join the live Web chat by going online to www.sba.gov, and clicking “Your Small Business Voice Online Chat.” Web chat participants may post questions for Brown before the September 14th chat by visiting http://app1.sba.gov/livemeeting/liveCakeLove/intro.cfm and posting their questions online.

To review archives of past Web chats, visit online at
http://www.sba.gov/chats/.
Educational Entrepreneurship: Realities, Challenges, Possibilities
Edited by Frederick M. Hess
Harvard Education Press, 2006, $29.95

From AEI review: Though today’s entrepreneurs are gradually remaking the structure of K-12 education, most accounts of their work either celebrate successes or bemoan their excesses. Seldom do observers stop to examine the challenges and opportunities in store. This timely volume addresses a number of central questions: What is educational entrepreneurship and what does it look like? Who are the educational entrepreneurs and what motivates them? What tools do entrepreneurs need to be successful? What policies or practices enable or impede entrepreneurship? What would it mean to open up the education sector to more entrepreneurial activity?
http://www.aei.org/publications/filter.all,pubID.24862/pub_detail.asp
My talk with the Parker Kiwanis went OK. They are going to consider using the Franklin Circle format once a month for their meetings, and a teacher in the group is interested in starting a Franklin Circle for teachers.

I found this article about Wikis online this morning. Makes me wonder if a should start a Wiki for Franklin Circles. Or maybe a wiki for self-directed learners, link to meetup.com, other ways that adults gather to learn from each other; include service clubs that are using the Franklin Circle format.

Here's the article:

Forbes Online
Entrepreneurs, Start Your Wikis
Tom Taulli 08.31.06, 6:00 AM ET


In five years, Wikipedia has bloomed into the largest online encyclopedia. Its simple but powerful concept--allow everyone to write and edit the content (under the auspices of some devoted administrators)--has compelled more than 48,000 current contributors to bang out 3.8 million articles in 100 languages. By its own estimates, the site now captures roughly 4% of the daily traffic on the Internet.

But there's more to Wikipedia than skipping a trip to the library. The site's underlying group-think principal can be applied to manage and build businesses more effectively.

Don't feel like shelling out thousands of dollars for complex project-management software from Microsoft? You can set up an easy-to-use "wiki" for far less. Want to boost your page rank on big search engines like Google and Yahoo!? A wiki works well. And unlike blogs and discussion boards, which unfold in relentlessly chronological order, wikis group related information into defined buckets that can be searched and edited quickly and easily. (Hence the term wiki--coined a decade ago by programmer Howard Cunningham--which means "hurry quick" in Hawaiian).

Some wiki programs, like WetPaint.com, are gratis; others are not. The free, open source versions are a bit trickier to use and still lack common editing capabilities. More robust commercial versions--such as Jot.com, MindTouch and Near-Time--range from $5 to $70 a month. All you need is a browser and an Internet connection.

http://www.forbes.com/2006/08/30/wikipedia-google-ebay-cx_tt_0830straightup_print.html

Tuesday, September 05, 2006

I've been up early, thinking about the talk I'm giving tonight to the Parker Kiwanis club.

It's important for me to do a good job tonight. The Rocky Mountain Kiwanis have listed me as a potential speaker for their clubs, thanks to my friend Joe Sabah. This is the listing for me:

“Learn to Win!” John Wren - Since 1996, John Wren has been sharing Ben Franklin's powerful education technique, what may have been Ben's best invention! To invite John (and Ben) to your next meeting, contact them at 303-861-1447 - JohnSWren@aol.com

You can see the complete lising of Kiwanis speakers at http://www.rmdkiwanis.com/Speakersbureau.pdf

Seems to me service clubs such as Kiwanis, Rotary, Lions, and Optimists have a big, big potential to transform themselves into adult self directed learning groups.

I joined the South Denver Optimists Club a couple of years ago. They have elected me President for the year starting the first of next month (October) and we are going to test using the Franklin Circle format for our meetings. (see http://www.wikihow.com/Start-a-Franklin-Circle-Adult-Self-Directed-Learning-Group for information about how you could start a Franklin Circle, or email me at JohnSWren@aol.com if you'd like to join us at the South Metro Optimists or if you'd like to join the group of small business owners and entrepreneurs I'm now forming.)

Monday, September 04, 2006

This article appeared in today's New York Times. After reading it, I set up an article, "How to Start a Franklin Circle." Please take a look and edit/add to it, OK?

http://www.wikihow.com/Start-a-Franklin-Circle-Adult-Self-Directed-Learning-Group

I'm going to use a print out of this as the hand out at the talk I'm giving tomorrow evening (Tuesday, 9/5, 7pm) at the Parker Kiwanis Club. If you'd like to attend, call Gay at (303)748-1144 for more info about the club.

Here's the NYT article:

Every day, millions of people find answers on Wikipedia to questions both trivial and serious. Jack Herrick found his business model there.

In 2004, Mr. Herrick acquired the how-to guide eHow.com, which featured articles written by paid freelance writers. Although the business made a profit, he realized that the revenue brought in by selling advertising would not support the extensive site he had in mind. “If the page were about how to get a mortgage, it would work,” he said. “But the idea was to be the how-to guide to everything.”

So in January 2005 he started wikiHow, a how-to guide built on the same open-source software as Wikipedia, which lets anyone write and edit entries in a collaborative system. To his surprise he found that many of the entries generated by Internet users — free — were more informative than those written by freelancers.

“Wikipedia proved you could get there with another method,” Mr. Herrick said. Several months ago he sold eHow to focus on the new site, which now has 10,000 entries in English, Spanish and German.

http://www.nytimes.com/2006/09/04/technology/04wiki.html?th&emc=th

Sunday, September 03, 2006

What can you and I do today to promote representative democracy and its' central truths, that all human beings are endowed with inalienable rights and that representative democracy is the most just and effective form of government, the system of representative democracy that David Brooks says is the only solution to nuclear annihilation? Here is his column from today's New York Times. How can we respond to this call to action? John





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September 3, 2006
Op-Ed Columnist
The Jagged World
By DAVID BROOKS

I don’t know about you, but while the events of the past five years haven’t really changed the patterns of my everyday life, they’ve certainly transformed the way I see the world.

I used to see the world as a landscape of rolling hills. There were different nations, tribes and societies, but the slopes connecting those groups were gradual and hospitable. It seemed relatively easy to travel from society to society, to understand and commune with one another.

Globalization seemed to be driving events, the integration of markets, communications and people. It seemed to be creating, with fits and starts, globalized individuals, who had one foot in a particular culture and another foot in a shared flow of movies, music, products and ideas.

I spent much of the 1990’s (that most deceptive decade) abroad — in Europe, the former Soviet Union and the Middle East. People everywhere seemed to want the same things: to live in normal societies, to be free, to give their children better lives.

Now it seems that was an oversimplified view of human nature. It’s true people everywhere want to satisfy their desires, but they also require moral systems that will restrain and give shape to their desires. It’s true people everywhere love their children, but they also require respect and recognition and they will sacrifice their own lives, and even their children’s lives, in wars for status. It’s true people everywhere hate oppression, but they also require identity, and human beings build identities by collectively hating groups that represent what they are not.

All these other parts of human nature impel people to become tribal. People form groups to realize their need for status, moral order and identity. The differences between these groups can be vast and irreconcilable.

Now my mental image of the landscape of humanity is not made up of rolling hills. It’s filled with chasms, crevices, jagged cliffs and dark forests. The wildernesses between groups seem stark and perilous.

People who live in societies where authority is united — as under Islam — are really different from people who live in societies where authority is divided. People in honor societies — where someone will kill his sister because she has become polluted by rape — are different from people in societies where people are judged by individual intentions. People who live in societies where the past dominates the present are different from people who live in societies where the future dominates the present.

Samuel Huntington once looked at the vast differences between groups and theorized that humanity is riven into different civilizations. That’s close but not quite right. Today’s divisions aren’t permanent. Instead, groups are constantly being formed and revised in a process of Schumpeterian creative destruction.

Yesterday’s high-tech entrepreneurs look like pikers compared to the social entrepreneurs of today. Islamist entrepreneurs have quickly built the world’s most vibrant and destructive movement by combining old teachings, invented traditions, imagined purities and new technologies. The five most important people in the Arab world, according to a recent survey, are the leaders of Hezbollah, Iran, Hamas, Al Qaeda and the Muslim Brotherhood. Microsoft’s market conquest is nothing compared to that.

Other and more benign groups are being created as well: Pentecostal sects, MoveOn.org, Hugo Chávez populists and whatever groups are invisibly forming among left-behind peasants in India and China.

The chief driver of events right now is not only globalization — the integration of economies and peoples. It’s also the contest among cultures over the power of consecration — the power to define what is right and wrong. Rising hegemons like Iran (and the U.S.) see themselves not only as nations but also as moral movements.

Since 9/11, the U.S. has had little success in influencing distant groups. Americans blew the postwar administration of Iraq because they assumed they were liberating a nation sort of like their own. And yet I can’t seem to renounce my own group, which is America. It would feel like cultural suicide to repress the central truths of my society, that all human beings are endowed with inalienable rights and democracy is the most just and effective form of government.

The hard lesson of the last five years — that we live in a jagged world filled with starkly different and contesting groups — makes democracy promotion more difficult but more necessary. Only democratic habits will prevent the inevitable clash of the tribes from turning into a war of nuclear annihilation.