Innovators World

Donald Trump and the changing composition of humanity

Within his first year of Presidency, Donald Trump already has a legacy. Under his watch, USA lost its position as a global leader. His strengths highlight the Christian focus on innovations with very little regard for morality. His weaknesses accelerate the US decline in global standing. We now have a visible turning point of USA’s decline which lowers the standing of Christianity among humanity of Christians, Muslims, Indians and Chinese.

Donald Trump is a product of the US society, trained to focus on his self-interests, not public goods. He is doing what he was taught to do. He sought a more prestigious education as a third-year transfer student from Fordham University in New York City to Wharton class of 1968 which had 366 students. Donald Trump did not graduate in the top 15% of his class (he was not among the 56 students on the Dean’s List). As a realtor, the government may be just a tool to get the public behind his properties.

In business school, we were taught to find a niche to deliver returns on investments, often taking the path of least resistance. Large businesses lobby the government for favorable legislation. As early as 1823, a highly innovative but amoral Supreme Court decision from the First Chief Justice John Marshall changed land ownership of the entire USA to European Christians. This “Discovery Doctrine” declared all Native Americans were tenants of Christian landlords. We can still see the consequence of this decision by looking at the electoral map today: Republicans control the land in between the coasts while Democrats control major cities in the east and west coasts. If we elect the President based on land ownership, Republicans would dominate national elections.

Election polling did not capture the difference between popular vote and electoral college. Facing defeat, Donald Trump openly called for the Russians to hack into and leak the Hilary Clinton emails. There is increasing evidence that his team, especially Mike Flynn who is a Democrat, colluded with Russians and did just that. In turn, we have heard the strongest Donald Trump support behind Flynn who is not part of his family. Time will give us the needed truth behind what happened in the 2016 election. To paraphrase a Christian motto: May the Truth Set us Free.

Instead of focusing on his tweets, let us defend our values by enforcing our conflicts of interest rules and regulations. Don’t let our government remove the estate tax. Wealth gap will widen if we allow the wealthy to legally keep their assets across generations. We relied on IRS regulations to capture Al Capone, and forced illegally obtained wealth to revert back to the government. Don’t let Donald Trump use the POTUS position to accumulate his wealth. He has already obtained six more trademarks in June 2017, with a cumulative total of at least 123 registered and provisionally approved trademarks in China alone. Sanctions against his empire will be more effective than being distracted by his tweets.

60% of all humans born in the last 200 years have followed either the Christian or the Muslim faith. With the decline of the USA driven by Donald Trump, that percentage may dip below 50% in the next 200 years. It is sad to experience the decline of USA accelerated by Donald Trump.

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Innovators World

Moral Innovator view of “Who Stole the American Dream” by Hedrick Smith

Hedrick Smith’s book highlights events in the USA between 1971 and 2011 that ended with a call for change at the grassroots level.  It illustrates the USA perspective within the Moral Innovation framework.

The Moral Innovations framework focuses on 5,000 year evolution of the four ancient civilizations.  Egyptians focused on innovations and evolved through the Roman Empire to become the 2.4 billion Christians today.  USA, with 75% Christian population (both Protestants and Catholics), continues to focus more on innovation in a democratic government.  When USA was born 240 years ago, China was the largest economy on earth with 33% of the global GDP.  Today, USA’s economy is double the size of the #2 China.  As a percentage of global GDP, USA and China together command 33% of the global GDP.

The author presents a logical story of how USA became a global leader by virtue of a vibrant middle class after Henry Ford started to pay his employees sufficiently high wages to command a comfortable living.  This was reinforced by labor unions which have been exempt from anti-trust laws, and thrived through the second world war and the civil rights movement.  Overall, USA was the “land of opportunity” with the most widely shared economic prosperity (to the majority of the US population) and the most affluent middle class of any place on earth.

There was a perfect storm that hit the USA Middle Class from three directions that favor the super-rich 1% of Americans:  1) government, 2) companies that make products, and 3) companies that provide services:

–        There was backlash against the social progress through the 1960s with Civil Rights, Voting Rights and 20 million people march on Earth Day.  The US Chamber of Commerce Lead Counsel and later Supreme Court Justice Lewis Powell woke up Corporate America to lobby in the best interests of the companies, specifically the CEO plus the shareholders of the companies.  This propelled the formation of 2,000+ pro-business entities that support the transfer of trillions of dollars from 99% of Americans to the top 1% super-rich in the form of “reverse Robin Hood” through trickle-down economics in the form of Reagan and Bush tax cuts (e.g. corporate tax decreased from 92% to 35%, preferential capital gains tax of 15% instead of 37% for ordinary income, and estate tax declined from 77% to 55% or lower).  The unlimited funding of the Super-Political Action Committees supported the US$6 billion 2012 political campaigns, down to the level of district gerrymandering where Democrats may win the popular vote, but Republicans would win the congressional districts.  With only 37% of eligible voters voted in the 2010 elections, the “minority tyranny” used filibusters to control the Congress despite a 52 year high of 46 million Americans below the poverty line, and 1% of Americans captured 93% of the nation’s recovery.  In 2013, Ted Cruz’s Tea Party used filibusters to shut-down the government.

–        In terms of product offerings, evidence that USA began to lose its innovation leadership includes the spin-off of the basic research performed by Bell Labs in Murray Hill to Lucent Technologies in 1996 to focus more on profit making.  Two major cost components that affected business profit were pension and health care expenses.  Businesses began to offload pension expenses in the form of 401(k) for employees to manage their own retirements, and Obamacare is beginning to offload healthcare expenses for employees to manage their own health care expenses.  Just as USA started to shift the pension and healthcare expenses, both China and India offered lower cost alternatives to businesses primarily in manufacturing and IT functions, respectively.  They facilitated the CEO decisions to lower cost by laying off high cost USA employees (in salaries, pensions, and healthcare expenses).  This shift meant millions of USA middle class jobs went overseas. For example, Microsoft had 12,000 permanent temporary workers without benefits in the 1990s.  In 2005, 43 million US workers were classified as contingent workers.  The lower employee costs meant higher company profits that CEO reported to shareholders under the façade of globalization.  CEOs were rewarded with high salaries, but more importantly, most of the CEOs compensation were in the form of stock and stock options with preferential capital gains taxation that dominated the wealth accumulated by CEO and shareholders.  With friendly bankruptcy laws that allowed the CEO to continue to work in the company, CEOs took out huge compensation packages no matter what happened – to reorganize, to sell, and to separate from the company. 

–        In terms of service offerings, the mortgage banks, the Rating Agencies (that determine the cost of borrowing based on the risks associated with the debt), and the Federal Reserve Bank enthusiastically supported George Bush’s call to increase home ownership (especially to minorities):  They offered mortgages to middle class Americans who cannot afford them.  The mortgage bankers had no risk because they sold their individual mortgages through two quasi-government entities Freddie Mac and Fannie May who, in turn, sold them to investment bankers and innocent investors who believed these Collateralized Debt Obligations (CDO) were low risk because they had equivalent AAA ratings from the rating agencies.  The 2008 housing bubble meant middle class Americans lost US$5.1 trillion of home equity primarily because the banks offered financing to people who could not afford the homes they purchased.  With government bailouts and support, CEOs took out huge compensation packages no matter what happened – to create the bubble, to solicit bailout from the government, and to tell the world what happened.

These three dimensions highlight the focus on innovations without sufficient consideration to have corresponding appropriate moral standards.  Two other issues were not covered in the book:  1) the valuation of the stock prices have been very subjective, dictated by “financial analysts” that are incentivized by higher valuation of the stocks, and 2) the impact of OPEC oil prices that transferred wealth to OPEC countries and large energy companies and their shareholders.

The use of “company” to build wealth is not new.  To bypass the authority of the Catholic Pope who gave the world to the Spanish and Portuguese in two treaties signed in 1494 and 1529, Britain and Dutch created British East India Company in 1600 and VOC in 1602.  They were both corrupt and vanished, but the British East India Company lasted longer because the British government gave the company monopoly power to trade in opium which led to the century of humiliation of the Chinese.

USA is becoming more like an aristocracy or plutocracy, not a democracy.  Changes will require grassroots organizations to hear the voices of the people, not the lobbyists.  From the Moral Innovator perspective, our ability to change the status quo in the USA will also impact India (the largest democracy on earth), because India has a very difficult task to separate the 1 million super-beings or angels from government decisions.  Without USA and India, we may lose democracy as a form of government on earth.

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Innovators World

Voice your opinion when you oberve senseless things before they become Genocide

In 1996 Gregory Stanton, president of Genocide Watch, did a briefing paper called “The 8 Stages of Genocide” at the US Department of State.  He suggested that genocide develops in 8 stages, and all are “predictable but not inexorable”.

This was presented shortly after the Rwanda genocide. The analysis is based on why the genocide occurred. The preventative measures suggested, given the original target audience, were that the US could implement directly or use their influence on other governments to have implemented.

 

Stage

Characteristics

Preventive measures

1.
  Classification

People are divided into “us and them”.

“The main preventive measure at this early   stage is to develop universal institutions that transcend… divisions.”

2.
  Symbolization

“When combined with hatred, symbols may be   forced upon unwilling members of pariah   groups…”

“To combat symbolization, hate symbols can   be legally forbidden as can hate speech”.

3.
  Dehumanization

“One group denies the humanity of the other   group. Members of it are equated with animals, vermin, insects or diseases.”

“Local and international leaders should   condemn the use of hate speech and make it culturally unacceptable. Leaders   who incite genocide should be banned from international travel and have their   foreign finances frozen.”

4.
  Organization

“Genocide is always organized… Special   army units or militias are often trained and armed…”

“The U.N. should impose arms embargoes on   governments and citizens of countries involved in genocidal massacres, and   create commissions to investigate violations”

5.
  Polarization

“Hate groups broadcast polarizing propaganda…”

“Prevention may mean security protection   for moderate leaders or assistance to human rights groups… Coups d’état by extremists   should be opposed by international sanctions.”

6.
  Preparation

“Victims are identified and separated out   because of their ethnic or religious identity…”

“At this stage, a Genocide Emergency must
  be declared. …”

7.
  Extermination

“It is “extermination” to the killers   because they do not believe their victims to be fully human.”

“At this stage, only rapid and overwhelming   armed intervention can stop genocide. Real safe areas or refugee escape   corridors should be established with heavily armed international protection.”

8.
 
Denial

“The perpetrators… deny that they   committed any crimes…”

“The response to denial is punishment by an   international tribunal or national courts”

 

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Innovators World

Anti-Semitic does not make sense!

The word Anti-Semitic was coined in 1879 as being Anti-Jewish.

However, Semitic relates to the Semites people, and Semites are offsprings of a person named  Shem, who was an offspring of Noah, from the Noah’s ark fame.  Semites include both Jews and Arabs.  

To make this more clear, assume you are an American.  We all know that American could mean Chinese American, African American, Caucasian American, Indian Americans, etc…  Would it make sense if we arbitrarily define anti-American as anti-Caucasian only?

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Introduction, Overview

Response to Garry’s Post on Progress

There is an important story to tell through Moral Innovations, and we need to articulate this story in a way that says we need to change behavior going forward…
 
Your point of the founding fathers is only 240 years old.  In the Innovators World (from Egyptians through Roman Empire to the Christians that spread westward to the USA), there have been very innovative ways to accumulate wealth without enough consideration for moral standards, going back 5,000 years.  We can use the founding fathers’ control of voting as a vignette, showing an innovative way to exploit others, similar to the Egyptians formalizing slavery of Jews (or actually Canaanites?? because the Jews claim Abraham was the first Jew, and Abraham is only 4,000 years old)…  To your point about needing acres of land to vote, I found the First Supreme Court Chief Justice John Marshall to be incredibly innovative when he used a single case to transfer ALL land in the USA to the Caucasians in the 1823 landmark Johnson v M’Intosh lawsuit (21 U.S. 543 (1823).
 
If you feel strongly about Tom Wessel’s book, why not incorporate the relevant elements into this dialogue.  The Moral Innovator story on progress is very simple:  Anyone should be given opportunities to have a comfortable lifestyle by working hard and contributing to improvements (this is akin to globalizing our American Dream) as long as he/she has appropriate moral standards not to exploit others.  What has happened hitherto in the Innovator World has been to exploit others like slavery for the Jews that evolved to the Romans expanding their territory by offering bounties from future conquests to recruit soldiers from the conquered territories, then integrated faith when Catholicism was officially recognized as the religion of the Romans in 380ce.  Eventually this led up to extremist events like the Spanish Inquisitions that had slave-like treatment for both native Americans and the African Americans (among the first human rights activist recognized by Caucasians is a Spanish priest who said we should not abuse Native Americans, so he proposed to the Spanish King that slaves should be captured in Africa and moved to the Americas before he rescinded his recommendation just before he died – but by that time it was too late, African slave trade started and the population of the entire African continent stayed the same between 1600 and 1820 when the Chinese coolies started to come from Asia to the Americas…).  Protestant Reformation happened after the Americas had been given to Spain and Portugal by Catholic Pope Alexander VI in 1494.  Once in the Americas, Catholics exploited South America by taking everything back to Europe (including gold, silver, potatoes, etc – there are no native South Americans today who can tell us about South America because everything is coming out of Spanish mouths/stories/books!).  In fact North America was great compared to South America partly because it was the Protestants who established USA and partly because the Caucasians wanted to stay in the USA.  The John Marshall land grab was just their way of saying USA belongs to Caucasians, then the exploitations became simple slavery which, again, was better than what was happening in South America (e.g. the 124 tons of gold which is the largest ransom ever paid, was for the release of the Incas Emperor Atahualpa in 1532 when about 140 Spanish explorers led by Francisco Pizarro took their host as a hostage – then decapitated him after the ransom was paid, even after Atahualpa agreed to be a Catholic!!  The only wish granted Atahualpa was to be buried in Quito, in today’s Ecuador.  By the way, 20% of this ransom was given to the King of Spain…) .  Once USA became a stronger country, Henry Ford created the Middle Class with the Model T which is another very interesting innovation before we had globalization.  After we created a middle class through the 1960s the combination of civil rights and globalization fed well into Hedrick Smith’s book that the theme became “create shareholder value” and “cut and slash to prosperity” which I actually participated in my career and know well how it works.  The cut and slash mentality basically destroyed the middle class, and it did not matter if the middle was black or white, because the wealth changed hands to the investors/shareholders.  Outside the USA, and continuing today, the biggest transfer of wealth ever among humans has been happening with OPEC when TRILLIONS of dollars of wealth changed hands to the top 1% of Muslims, which also helped the related major oil and gas companies to deliver higher profit for shareholders.  There has not been many significant operational value add activities for many decades now.  Microsoft, Google, and the Internet in general are tools to increase productivity and sales.  Tesla, GPS, renewable energy and perhaps fracking are the noticeable operational value add activities.
What is happening in the USA today is the annihilation of the middle class partly because 1) they can not keep up with the rapid change in technologies that increase productivity, and 2) there is an available option to go overseas like China and India.  It was such an easy story to say the salary in the USA is too high and China is much cheaper because the work done in the USA was mundane and in fact could be done better in China and India.  For the middle class USA to survive, values in the form of skills, knowledge or systems processing (e.g. efficiently utilize the internet and application tools) must be demonstrated.  Otherwise, what happened was a perfect storm for globalization and annihilation of the American middle class.
Next, USA must narrow down the wealth gap through a united front of moral innovators who deliver operational value, not just paper profit.  99% of Americans have to come together, study and learn through Moral Innovations that a society can thrive only if there are more than 1% of the people who can defend the moral standards of being Americans.  Outside USA, we need to set an example with China to deliver operational value together.  The Muslims top 1% will become vulnerable when they lose the OPEC oil money, and Indians has to understand democracy can not be effective with a million gods/angels integrated into their governance (their first step towards democracy is separation of church/religion and state).  Over time, India will integrate with the Christians, and Muslims will integrate with the Chinese, after Chinese and Christians (led by Americans) will work together on delivering value together.  By that time, we will all be dead.
So… moral innovators need to know this story, beginning at the high school level in my mind, to learn what they want to do in this world with what moral standards…  We can not expect changes overnight.  Even Martin Luther King Jr. did not push civil rights successfully overnight.
The Moral Innovations framework says human nature has not changed in the last 5,000 years.  What we have are four ancient civilizations evolving with their respective strengths and weaknesses over time.  Egyptians have continued to innovate as they became Christians, Sumerians have continued their belligerence at the top 1% level which is currently financed by OPEC oil as Muslims, Chinese have continued to trade for 5,000 years, and Indians have a mixture through 2,500 years of being partially colonized, ending up with a million gods/angels in the world’s largest democracy. 
 
Volunteerism, air/water quality, human rights etc are red herring issues because they can not be addressed with the same standard or values across the globe.  China may have destroyed their environment, they need moral innovators to sustain a stronger economy that can also improve the poor environmental quality.  USA’s environmental quality is dying also, especially now with fracking (which is why USA may become an exporter of energy again) and you can tell that via the water quality in West Virginia.  In the Moral Innovation framework, readers have the freedom to improve the environment or regulations. 
Your statement:  “…all organized entities (organic or social) move towards greater complexity…” should be reviewed in light of the following example:  The cut and slash approach was a simple move high cost areas to low cost areas, and shareholders make more money.  It was so simple that everyone understood and supported, and the result was higher stock price, and (Hedrick Smith’s Book says) Al Dunlap made $166,000 every day he was cutting up divisions and people out of his company at Scott Paper before he sold it to Kimberly Clark.  One day, possibly before we die, the stock market will completely crash with more reasonable valuations.  We need to examine how stocks are valued these days…

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Innovators World

Progess according to Tom Wessel (on behalf of Garry)

I think these are some awesome observations you are making.  That is, that America is not so much “copying” China, but is following a similar path towards decline or falling apart as an empire/society.  Much of what I read, and Wessel’s book is an example, points to the fact that all organized entities (organic or social) move towards greater complexity.  Anand can vouch for this point by referencing one of the salient points from his atheist icon Richard Dawkins, who seems to believe in “self-organization” which is the tenet that all entities tends to move from a less organized to a more ordered state of being (although, conversely, we are also aware of entropy which is the physics of disorder).  So, we see that with the passage of time, entities (societies, armies, technologies, ideas, individuals) become more complex.  Unfortunately, this complexity is not necessarily a sign of true progress.  I believe, David, that you are pointing to this phenomenon.  That is, despite the development of dynasties, technological advancements, and historic changes, the passage of time does not necessarily see these entities/systems become “better” (that is, progress).  The absence of Moral Innovations might explain this failure.
 
For instance, I believe that the absence of a moral component in their relationship with the Chinese is what allowed the British to use opium as a way to balance the trade they had developed (because the Chinese did not value or trade for British textiles/products and only accepted payment in silver).  I believe that it is an absence of Moral Innovations in America (despite the belief of many Republican politicians and conservative, jingoistic citizens who believe in American exceptionalism and goodness) that has allowed us to allow the “Market” to assign socio-economic stations in our nation, which has led to the expected result of capitalism (a triangle) of a miniscule upper class (that 1% tip) to rule and benefit from the “bottom” 99%.  I do not believe that this is a phenomenon isolated to the period of 1971 to 2011.  Case in point, let us just think about the Founding Fathers … they were a small class of wealthy planters, bankers, and philosophers, who were either educated and/or well-traveled (oh, and by the way, they were also white and male) … in fact, you could not vote if you were not white, male and owned a sufficient amount of property (approximately 50 acres) or equivalent taxable wealth/income.  Accordingly, the America that developed as a consequence of (and still worships) that era of leadership — there is not greater compliment in American political discourse than “Founding Fathers” — does not really embrace the concept of limiting the accrual of power and wealth in a small circle of privileged elites.
 
So, when you ask what is the practical worth of Wessel’s book, I believe it lies in its analysis of our national investment in the belief of unlimited progress (which is a fallacy) and that the logical consequence of our national myth about capitalism and democracy is something good.  The myth of progress allows us to dispel the easy assumption that more is better and that certain tools for measuring worth (money, power, etc.) are accurate or desirable.  When we look at how well the economy is performing, does it every evaluate the worth or element of such things as volunteerism, taking care of family or the elderly, recycling, social and political activism … or any other factor of modern life that is not immediately or easily reducible to a monetary figure?
 
How do value the impact of air, soil, and water pollution?  Do we just value the regulatory costs?  That is, penalties and fines?  Taxes paid?  Law suits and resulting cleanups?  Healthcare consequences?  Health consequences?  Resulting impact on the development of our children?  The diminution in the quality of our environment (lack of clean air or water or lands)?  And so on…
 
This is a dense topic, as are many others …
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