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The Super-richThere has always been a gap between rich and poor. But in the last few decades what it means to be rich has changed dramatically. The greatest income gap is not between the rich 1% and the remaining 99%. Even within the top 1%, the ordinarily wealthy are left behind by the rapidly expanding fortunes of the new global super-rich. The wealthiest 0.1 % are rapidly outpacing the rest.
The Economist's "Special Report on the World Economy" describes a dramatic concentration of incomes that has occurred over the past 30 years. The pattern of inequality is especially glaring in the US, in terms of both absolute inequality and recent trends.
The report lays out some of the relevant statistics about the US: The share of national income going to the wealthiest 1% of Americans has doubled since 1980, from 10% to 20%. The share going to the highest one hundredth of one percent -? only 16,000 families -? has quadrupled during the same time from just over 1% to nearly 5%.
The gap continues to grow because the capitalist system favors wealth. If you have a few billions, your investments yield billions and tax shelters minimize your taxes.
Plutocrats are in a league of their own, making their own rules. Consider the Koch brothers' and the Las Vegas magnate Sheldon Adelson's few hundred million investments in the super-pacs that backed Romney against Obama. For them that was chump-change. If they lost it completely (which they did) it was likely written off against their tax obligations.
In her new book, "Plutocrats - The Rise of the New Global Super-Rich", Chrystia Freeland, an acclaimed business journalist who has spent 20 years reporting on the new transglobal elite, cracks open this tight-knit world of the new global super-rich. She shows how the world's one thousand billionaires control the economic and political institutions of their nation.
Some of this growing inequality comes from the upward redistributive effect of government policy. The Economist notes that when taxes and entitlements in the US are all taken into account, "the government lavishes more dollars overall on the top fifth than the bottom fifth."
Crony capitalism has deep political roots. In 2010, there were 11,140 lobbyists in Washington for 432 congressmen, or 25.8 lobbyists per congressman. They have been allowed to tilt rules in their favor and the Wealthy are the biggest winners from changes to America's tax code. We Americans are ashamed of the political bribery in our country, but seem to be powerless to do anything about it. More in future e news.
Self-driving CarsGoogle's driver-less cars are already street-legal in three states, California, Florida, and Nevada. According to Ford, the self-driving car will be available within five years.
According to a recent report by KPMG and the Center for Automotive Research, autonomous cars will be in showrooms as early as 2019.
Essentially, smart cars will communicate with other vehicles on the road so they don't crash into each other. They'll also have the ability to sense and respond to the surrounding infrastructure: stop signs, street lights, guardrails, and other basic transportation signals. Eventually they'll be able to drive better and more safely than people - no drinking, no distractions, better reflexes, and better awareness of other vehicles (via networking).
In Google's ongoing Driverless Car project, the Google fleet has driven accident-free for over 300,000 miles making it clear that the concept is completely viable. Each Google Driverless car is equipped with GPS, radar, video cameras, laser radar, and a lot of real-time computing power. Basic navigation relies on maps and GPS, with live sensor input to react to real-time changes. The entire setup costs about $150,000, which is obviously well beyond the reach of 99% of drivers; but clearly this cost will scale down quickly.
Another technology that figures prominently in the future of autonomous vehicles is communication systems which will make it possible to route traffic dynamically to maximize flow and minimize travel times, with increased road capacity. No more traffic lights, traffic jams and road rage!
Consider this list of benefits:
Antifragile: Things That Gain from DisorderA new wave of statisticians is changing the way the world is viewed.
Have you seen the 2003 movie, "Moneyball"? It demonstrates that the way big teams evaluate players rarely reflects ability. Statistics counts.
Nate Silver's statistics accurately predicted the results of the recent US elections, making traditional pundits and polls look foolish. His recent book, "The Signal and the Noise" is already Amazon's Book of the Year.
In the UK, Ben Goldacre's books Bad Science (2008) and the more recent "Bad Pharma" exposed poor experiments and the greed of the pharmaceutical industry.
Nassim Nicholas Taleb is among the best of these new statisticians. His books "Fooled by Randomness" (2001) and "The Black Swan" (2007) were among the first to show how poorly data is used to more accurately predict events. His new book is, "Antifragile: Things That Gain from Disorder".
What Taleb calls "antifragile" is the category of things that not only gain from chaos and stress, but need it to survive and flourish. Just as human bones get stronger when subjected to stress and tension, and rumors or riots intensify when someone tries to repress them, many things in life benefit from stress, disorder, volatility, and turmoil.
Antifragile is beyond resilient; the resilient merely resists shocks and stays the same, the anti-fragile actually become stronger.
Antifragile gains from randomness and uncertainty, and more important, adapts through errors. It's better to be stupid and anti-fragile than smart and fragile. Anything that gains from random events is anti-fragile.
The tragedy of modernity is that those that are protected the most are often hurt the most. Just like not exercising causes muscles to weaken, complex systems are weakened when deprived of stressors. Just like kids who are spoiled by over-protective parents, societies are spoiled by governments trying to relieve stress. It actually weakens the system.
Taleb's message is iconoclastic and revolutionary. He asks these provocative and insightful questions:
Mentor PowerThere are few things in the business world that are as effective and worthwhile as a good personal mentoring relationship.
Mentors made a tremendous difference for me, personally, during the startup phases of Action Instruments, the company I founded.
When the company was just a few months old, I went to the local US Small Business Administration (SBA) office for free advice through their Service Corps of Retired Executives (SCORE) program. I knew very little about finance and banking, and checked those off as areas where I needed help.
I soon received a call from a retired senior vice president at a major bank, who prepared me for my first banking "relationship." Through his mentoring, I signed up for a line of credit. Eventually we got major financing at terms that saved my company big bucks over the next several years.
The other mentor who made a big difference I also met through the SBA program. He had retired as Director of Planning at a billion-dollar research organization and he took me under his wing. He kept insisting that we should develop long-term plans covering 2, 3 and 5 years. As the company grew, this planning process became an invaluable tool and the regular planning discipline helped make us successful.
How does one develop good mentors? You've got to be bold and have a good personal approach. I remember calling Bill Hewlett, the co-founder of Hewlett Packard. It wasn't easy to get through, but my persistence and sincerity paid off. I told him that I was an engineer like him, starting my own company and asked if I could meet with him at his convenience. He invited me to his office in Palo Alto, California. His friendliness and open responses to my rookie questions served as "guru" advice which served me well.
When we were done, I said, "Your help is worth a million dollars to me. How can I ever repay you?" His candid response has remained with me for the rest of my life, "You can indeed pay, simply by giving advice to any engineer who asks for it sincerely, as you did." I have tried to live up to that promise ever since.
An effective mentoring relationship develops over time. A good mentor provides expert knowledge, support, empathy, respect and, most important, the wisdom of experience.
Mentoring is an essential leadership skill. It is the best thing anyone can do for an improved outlook on life. It's good for business, and good for the spirit.
Jim Pinto eMail Seasons GreetingsMy poem "My email Christmas" was first written on Christmas Eve, 1975. It has been published and sent via email countless times - some people email it back to me, not realizing that I wrote it.
Let me give you my 2012 updated version:
'Twas the night before Christmas and all through the house
But why does my email go click-click and beep-beep?
'Cause elsewhere in the world it's tomorrow already
And my flood of email comes in strong, fast and steady
By snail-mail with postage and hard-copy Christmas-cards
While others send few cards with stamps and lick-lick
I send thousands of email cards with a click
My one little mouse-click sends eNews round the world
For my cyberspace friends I just copy and paste
My cute email greetings just in time with no waste
My "Feliz Navidad" Spanish greetings extends
And my English buddies get a "Chin-chin old chap!"
"Put a shrimp on the barbie!" is my Down-under rap
Don't just have a virtual Christmas - go touch!
I wish you all a good time and good cheer
To all Season's Greetings! And a Happy New Year!
"Just as surely as every action creates and equal and opposite reaction in the laws of physics, major economic disruptions (industrialization, railroads, steel and autos) created their own nemesis
"I feel justified in predicting that the emergence of huge economies in China and India will redistribute the wealth of many peoples and nations, creating a notable backlash from some quarters. Since man never seems to learn from past mistakes, I predict that violence and possibly war may result, just as before.
"Where will the resistance most likely originate? The resulting wealthy will be happy with their new affluence and will not view it as ill- gotten gains. Thousands of their employees may judge differently as one might expect. It is mans' nature to feel mistreated even if his financial circumstances have doubled when all those about him have quadrupled their wealth.
"Relative wealth and the resulting social positioning has proven to be much more motivating than wealth itself. Dissatisfaction and a sense of unfairness can become a potent social driving force.
"The liberal faction of society is traditionally more responsive to these issues than the conservative element of society. Those in the liberal element that are most passionate and dedicated to the cause will most probably lead the charge for change. I feel justified in using the term 'firebrand liberals' as defining those most likely to be at the forefront of the resistance movement.
"It seems everyone has his own individual view of fair. But when everyone is equal (theoretical Communism) it is literally impossible to get traction for the underdog when everyone is the underdog."
"Are colleges bloated and inefficient? Sure. Do many of them promise a great future just for securing a degree? Sure. But in the end a free market economy runs on supply and demand, and the universities are simply responding to the demand.
"Attending a top university in person, in real time, is much more useful than eLearning will ever be. The student learns critical thinking in groups and teams, learns time management and communication skills with study groups, learns responsibility by handling finances, course demands, group living, etc. These are the skills future employers will need and will continue to look for.
"I have taken around 50 Internet based courses and have never gained the depth of knowledge and insight that I have when I have been taught by good university professors.
"Come on, let's go solve some real issues like health care, energy, global warming - the list is endless. The US university system is where most of the answers will come from."
"I find your highlights of today's thought leaders, the books they
write, and current/future topics in technology and competitiveness
to be very enriching. Your posts often lead me into very interesting
"Your September post on Michio Kaku was especially interesting.
I forwarded the YouTube presentation on the role physics plays in our
daily lives and what might come in the near future to both my daughters.
I am constantly on the lookout for unique pieces that communicate
the value of sciences to them.
"Perhaps an idea for a future post would be to focus on how to stimulate
more interest in today's youth in the sciences and engineering. What are
the top 10 list on web sites that may be interesting to some of today's
teens. Content on Ted.com, Ted ED, and wimp.com come to mind.
"Another topic could be to further discuss the immigration policy of the
US for grad students and compare it to Canada's immigration policy
for elite students which I believe is a little more enabling.
"How about a review of where the grads are 5 years after graduation from
the top tech schools in North America. Are they in BRIC countries, or in
North America? Is there a difference between US tech schools and Canada
tech schools on where their grads end up? This should be an issue for
government and I agree is of the upmost importance for future growth
of our countries and economies."
If you have comments or suggestions for Growth & Success News, please contact me directly at :
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"I find your highlights of today's thought leaders, the books they write, and current/future topics in technology and competitiveness to be very enriching. Your posts often lead me into very interesting territory.
"Your September post on Michio Kaku was especially interesting. I forwarded the YouTube presentation on the role physics plays in our daily lives and what might come in the near future to both my daughters. I am constantly on the lookout for unique pieces that communicate the value of sciences to them.
"Perhaps an idea for a future post would be to focus on how to stimulate more interest in today's youth in the sciences and engineering. What are the top 10 list on web sites that may be interesting to some of today's teens. Content on Ted.com, Ted ED, and wimp.com come to mind.
"Another topic could be to further discuss the immigration policy of the US for grad students and compare it to Canada's immigration policy for elite students which I believe is a little more enabling.
"How about a review of where the grads are 5 years after graduation from the top tech schools in North America. Are they in BRIC countries, or in North America? Is there a difference between US tech schools and Canada tech schools on where their grads end up? This should be an issue for government and I agree is of the upmost importance for future growth of our countries and economies."
If you have comments or suggestions for Growth & Success News, please contact me directly at : Jim@JimPinto.com
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To be removed send a blank email message to:
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