How To Have Economic Prosperity: Advice From Venture Capitalist

Nick Hanauer, wealthy venture capitalist, has been advising the country for the past few years how to become more prosperous: put more money in the hands of consumers. He recently repeated his advice at a Senate hearing. Here is his testimony. It is worth reading the entire presentation.

In some respects, Hanauer's explanation isn't much different from Henry Ford's insight when he paid his factory workers higher than the going wage. If his workers couldn't afford to buy his product, Ford realized, then his own enterprise wouldn't prosper. The super wealthy keep forgetting that insight.

Hanauer gets it right

"When someone like me calls himself a job creator, it sounds like we are describing how the economy works. What we are actually doing is making a claim on status, power and privileges.The extraordinary differential between the 15-20% tax rate on capital gains, dividends, and carried interest for capitalists, and the 39% top marginal rate on work for ordinary Americans is just one of those privileges.
We’ve had it backward for the last 30 years. Rich businesspeople like me don’t create jobs. Rather, jobs are a consequence of an ecosystemic feedback loop animated by middle- class consumers, and when they thrive, businesses grow and hire, and owners profit in a virtuous cycle of increasing returns that benefits everyone."

On Knowledge

People who think they know everything are a great annoyance to those of us who do.

— Isaac Asimov

D-Day

Just a reminder that sixty-nine years ago today, Allied troops stormed ashore on the landing beaches of Normandy, establishing a beachhead in France. Less than a year later, Germany surrendered. The United States was at war with Germany about three and a half years from declaration of war to surrender.

Al Gore And The Internet

In the 1980's I was in the computer industry, owning a small information technology company with a very small Defense contract. We communicated with other contractors and research centers using e-mail, long before the internet. We communicated over a network developed for Defense, known as Arpanet.

I became aware that a technically savvy member of Congress, one of the so-called "Atari Democrats," was pressing to open up this network for public, even commercial use. This was opposed by most Arpanet users in the research business. But the Atari Democrat in question kept pressing. That person was Al Gore. He eventually got his way.

I just came across an article here that gives a more complete story of Al Gore's role.

No, Al Gore didn't discover Global Warming, either. Scientists did that. Al Gore just let the rest of us know about it and described what needs to be done.

That's what leaders do.

Man With A Beard And Glasses

Have you heard the one about the stranger who came to the Town of Oriental looking for advice? He was looking for a particular sage experienced in boating. He came to the Bean to inquire of the regulars. "Joe?" The regular asked, just to pin the questioner down. "No problem. He's the old guy with glasses and a beard."

The stranger soon found out the description matches half the male population of Oriental.

Now suppose you are looking for an economist. Here's the account of that search.

Will D. Campbell (Alias Rev. Will B. Dunn) 1925-2013

Today's News and Observer announces the death Monday of the Reverend Will D. Campbell. The article provides a lot of background concerning Will Campbell's ground breaking work in Civil Rights that preceded the formal Civil Rights movement.

When I knew him, Will was Director of Religious Life at the University of Mississippi from about 1954 until the University encouraged him to leave in 1956. University authorities claimed that he wasn't fired, he just left to follow other paths. Right.

 The word avuncular was invented to describe Will Campbell. His head was egg-shaped, topped by a prematurely bald, avuncular dome. He smoked a  curved-stem avuncular pipe. In a discussion group, he stimulated discussions with avuncular questions.

Though he had been a preacher since he was ordained at the age of 17, he was never the flamboyant kind. It was only a year or two after he was ordained that Will answered his country's call and went off to World War II. It was his return from that war that transformed him and led him to what was to become his life's work. When the troop train reached the Mason-Dixon line, the soldiers, who had mingled freely in the railroad cars until then, were rearranged into segregated cars. "That's not right," Will recognized immediately.

Will used the GI Bill to go to college, eventually completing his BD at Yale. As Director of Religious Life at the University of Mississippi, he encouraged students to rethink the social arrangements referred to at the time as "the Southern Way of Life."

He was a dangerous man. Controversy dogged his heels.

In 1956, there was the Kershaw incident involving the Reverend Al Kershaw, a television quiz program, jazz music and the NAACP. That's a story for a later post.

There was another incident involving a student delegate from Ole Miss to the national Y convention.

The most famous incident involved a ping pong game in the Y building on campus.

I will share all of these stories at some point.

After leaving Ole Miss, Will worked for the National Council of Churches Department of Racial and Cultural relations. He appeared in Little Rock during integration of Central High, working behind the scenes to convince ministers to do the right thing. His success was limited.

He became an itinerant preacher and writer. He called himself a "bootleg preacher."

Will believed that, at least in the South, no people had more interests in common than the downtrodden African Americans and poor white rednecks.

In 1957, Will made a furtive visit back to Oxford, Mississippi. Will wasn't furtive about it, but the campus authorities placed furtive measures in place to make sure he didn't make his way back to the campus. A few of us met with Will at a local eatery. By then, we knew of his association with the Southern Christian Leadership Council. Someone asked him about Martin Luther King. "The man's a saint," Will replied.

My favorite book by Will Campbell is Providence, an account of what in Holmes County we always called Providence Plantation. He calls it Providence Farm, a not quite successful interracial collective farm eventually run out of (as in expelled from) Holmes County by the good, hard-working white folks around Tchula.

Will wasn't nationally famous. Might not have thought he did much good. But he did what he could among the people he knew best, with the tools at his command.

I think it's hard to ask for more than that.

Oriental Town Board Meeting June 4, 2013

Interesting meeting at Town Hall tonight. Much talk about the water board. If there is such a thing.

I have written about what it needs to do. Just search for "water board." Check it out.

WSJ Logic On Bicycles

Yesterday, I expressed puzzlement at the Wall Street Journal's rant about New York City's new program to make it easier for visitors to rent bicycles. "The logic escapes me," I wrote. It seems such a good idea to have more bicycles and fewer automobiles. I have long thought that driving a car to get where you want to go provides only the illusion of freedom, not the real thing.

Travel in Europe, where you can get to where you want to go using high quality, readily available and frequent public transportation, frees commuters and tourists alike from a lot of aggravation. Not to mention expense. It also frees young people not old enough to drive as well as their parents from needing or providing family taxi service. This seems a good thing. Before I was old enough to drive, I was able to get around perfectly well on my bicycle. In those days, the mid to late 40's, my family had only one car.

Paul Krugman has cleared up my confusion. The Wall Street Journal, he explains, isn't defending the rights of those who want to drive themselves from place to place, but to prevent annoyance to those who are routinely driven from place to place. It's a class thing. It's about wealth, power and deference.

Bicyclists don't respect their betters.

Now I understand.