100% Anti-Stupid

Why I will never buy a Toyota product

2010-02-21T19:40:00.001-08:00

Much has been written in the last 90 days about Toyotas, recalls, unintended acceleration, and safety and quality. The Los Angeles Times, for example, has an excellent series of stories they've called "Road to Recall" going over the calamity that is Toyota. Toyota's problems are particularly discomforting for owners given Toyota's previously stellar reputation for quality and reliability, a reputation that Toyota had no qualms charging extra for.

Like anything manufactured by humans, Toyota vehicles are susceptible to flaws. However, while it is inevitable that every product can be brought down by mistakes, it is not inevitable that these mistakes lead to the same train wreck that is now befalling Toyota and its vehicles.

There is most definitely a right way and a wrong way to respond to a crisis and at every turn, Toyota has picked the wrong one.

That said, I now present to you the reasons why I will never buy a Toyota, Lexus, or Scion product

PIECEMEAL RECALLS: Various Toyota models are sold in nearly identical form in multiple countries. One would expect then that if a model is recalled, it would be in all countries. Sadly, evidence indicates that Toyota did not do so and instead waited weeks or even years between recalling nearly identical models in separate countries.
UNDERESTIMATING/TRIVIALIZING THE PROBLEM: Evidence indicates that reports of unintended acceleration came to Toyota's attention as early as 2004. By late 2009, Toyota had enough reports of unintended acceleration to know it was a problem, but it was apparently not enough to warrant a full-fledged recall (1). In other words, Toyota was pulling a Pinto. Lastly, throughout the entire recall mess, Toyota has steadfastly insisted that the unintended acceleration problem is "rare", completely ignoring the fact that it is anything but rare if it happens to you.
FOCUSING ON PROFIT: On February 21, 2010, an internal Toyota document (dated July 6, 2009) was released in which the company boasted it saved "$100 million" by negotiating with federal regulators to limit the scope of an upcoming recall over unintended acceleration.
OBSTRUCTION OF JUSTICE: Perhaps this is just political posturing, but Henry Waxman (chair of the Congressional committee giving Toyota the screws) accused Toyota of withholding information and relying on flawed studies to dismiss consumer complaints of unintended acceleration. Separately, Congressman Edolphus Towns, head of the House Oversight and Government Reform Committee, said that Toyota "deliberately withheld" evidence in lawsuits related to vehicle safety, exhibiting a "systematic disregard for the law." When read in conjunction with Toyota's handling of the recall thus far -- including an absentee CEO, piecemeal recalls, memos boasting of $100M savings, stuck floormats and gas pedals, and stubborn insistence that the car's electronics are fine -- goes to show you that Toyota really has no fucking idea what it's doing.
OVERESTIMATING THEIR ABILITY TO SOLVE THE PROBLEM: In the US, the first Toyota recall due to unintended acceleration was in or about October 2009 for -- allegedly -- defective floormats that would cause the gas pedal to jam. Does that make sense from a sheer logic perspective? No. First, it seems that a floormat that moves (much less jam the gas pedal) would be very easy to spot. Second, lots of cars have floormats and being low tech devices, it seems to me that there's nothing unusual about Toyota floormats that would cause them to stick/move more than Honda or Ford floormats. Third, the recall was by-country -- meaning, for example, that Camrys made in the US were affected but Camrys made in Japan were not. I'm not an expert in how Toyota makes cars, but it stands to reason that Camrys sold in the US are the same (i.e. same parts), regardless of where they are made. The second recall in mid-January 2010 was over gas pedals that were slow to return after being depressed. On the surface, this seems slightly more logical, except for one small thing: fixing the gas pedal doesn't solve the problem.
BLATANT STUBBORNNESS AND AN INABILITY TO SOLVE THE PROBLEM: Toyota first said that sticking floormats (somehow) caused the unintended acceleration. Three months later, it was sticking accelerator pedals that were the cause (except now it seems like they weren't). During Congressional testimony in late February 2010, Toyota executives even admitted that the recalls would not totally fix the unintended acceleration problem, (to which I would respond "You built the fucking car you imbecile! If you can't fix it, who the fuck else can?"). Despite all this, the one thing Toyota is absolutely sure about is that the unintended acceleration problem is not (emphasize NOT) due to the electronic throttle system that Toyota introduced in many models in or about model year 2002. (By a strange coincidence, reports of unintended acceleration shot up in Toyota models shot up after mechanical throttles were replaced by electronic ones.) Toyota's insisted this even though an automotive professor was able to reproduce the problem by fiddling with the electronic throttle system in a Toyota Avalon.
RELUCTANCE TO ACCEPT RESPONSIBILITY: In February 2010, as the problems with Toyota vehicles increased, Congress decided to hold a public hearing. If you saw the hearings, you know that Toyota CEO Akio Toyoda was there and gave testimony with the help of interpreters. It wasn't always this way, though: Up until the last minute, CEO Toyoda was not going to appear before Congress, insisting instead that US-based Toyota executives could handle it. Toyoda's hands-off approach to this entire recall matter (including his grammatically-challenged apology) is also telling (i.e. it tells Toyota's customers that the company doesn't give a rat's ass), but it is possible at least some of Toyoda's reluctance may be due to cultural issues.

As in any endeavor (life, law, business ,etc) a judgment that is based on the totality of the circumstance is likely to be more representative of the truth than one based on a singularity. What does the Toyota mess (so far) tell us? The vehicles themselves are well-engineered and reliable 95% of the time. If Toyota would pull its head of its proverbial corporate ass and be open and honest to the same degree they've been stubborn and shifty, then the remaining 5% would have been dealt with long ago.

As a start, for example, here are several things Toyota could have done to handle this recall, but did not as far as I know.

Setup a 1(800) number where consumers could get information on whether their car was recalled.
Create a website with videos detailing the problem and what work has been done on a day-by-day basis to solve the problem. This strikes me as a much better way to handle any recall than to leave your customers high and dry with nothing but "We are working hard to solve the problem" to comfort them.

Good to hear that the other auto companies capitalized on Toyota's misfortune by offering customers a whopping $1,000 to trade in a recalled Toyota model. And so exemplifies rule 2 of business: kick your opponent when he's down.

Why health insurance premiums will always go up

2010-02-20T13:20:00.001-08:00

Several weeks ago, the San Jose Mercury News did this story comparing the cost involved in driving a car versus taking public transportation. (Because the Mercury News is a very uncool paper that doesn't make their stories available on the web indefinitely for free, the story I'm referring to is called "Running on Empty: Bay Area transit in crisis" and was written by Mike Rosenberg. The story ran on January 9, 2010 on what I believe was the front page of the main section of the Merc).

Anyway, the conclusion of the story was that -- surprise, surprise -- in almost all circumstances, taking public transportation around the Bay Area is an all-around loser. It takes longer to get where you're going -- sometimes 2 or 3 times longer -- and you don't save enough money to make the extra time spent worth it. On top of that, depending on the agency, you risk being beat up or stabbed. The only way public transit makes sense is if parking a car is either very expensive or very difficult. When I go into downtown San Francisco, for instance, I always take public transit because parking is so expensive.

The reason for the Mercury News' article originally was that the imploding economy is causing many public transportation agencies in the Bay Area to lose money as income falls but expenses don't. To plug their deficits, these agencies are raising fares.

The problem with raising fares, as the Mercury News discovered, is that it actually makes the deficit worse. As fares get more expensive, people with cars decide that it's actually more convenient (and possibly cheaper too) to drive instead. As a result, fewer people take public transit which means the agency still gets fewer fares. The only result of higher fares is that people who have no choice but to take public transit (the elderly, the poor, the young, etc) are forced to fork over ever increasing amounts of money to get where they're going.

This same phenomenon is quite common in other arenas. When newspaper or magazine circulation decreases -- perhaps because the subscriber views the paper online, people think the reporting sucks, etc -- the publication itself gets less subscription revenue. It may be tempting to simply raise subscription rates on the remaining subscribers to make up the difference, but what does that do? Right. It causes more people to cancel their subscriptions which means even less revenue. When you factor in advertising, the problem gets even worse. Fewer subscribers means lower advertising rates since advertisers don't want to pay a lot to advertise in a paper few people read. If you raise advertising rates to make up the difference, you merely accelerate the rate at which advertisers leave.

The other arena (or at least the other arena that comes to mind right now) in which this occurs is health insurance. Recently, Anthem Blue Cross made headlines in California because it wanted to increase health insurance premiums for some customers by 39%. The reason? A variety of factors, including the poor economy, the higher cost of treatment, etc.

Like most people, I've noticed for the longest while that the cost of health insurance just keeps going up -- often much faster than the rate of inflation. I struggled for the longest time to understand where all that money was going, but now I think I understand.

Because health insurance is not mandatory, healthy people who are unlikely to need health insurance -- for example, healthy 23 to 26 year olds -- often get rid of it to save money when the economy gets bad. The underlying idea of any type of insurance is that the premiums paid by those who are unlikely to need it subsidize the expense of providing benefit to those who are likely to need it. In other words, healthy people help pay for the cost of treating the unhealthy. As more and more healthy people drop their health insurance, poor people necessarily have to pick up more of the true cost of their treatment.

By raising premiums on the unhealthy, however, you simply cause more people to drop their insurance. For example, maybe it was the healthy 23 to 26 year old customers who dropped their insurance when the economy went south. This caused premiums for everyone else to go up in order to provide the same coverage for those who remained. The new higher rate, however, will cause the healthy 28 to 31 year old customers -- people who likely don't need health insurance also, but who have less price elasticity than the healthy 23 to 26 year old customers -- to drop their coverage. This in turn causes premiums to go up even more for the people who remain.

At this new higher rate, maybe the healthy 32 to 36 year old customers will be incentivized to drop their coverage, thereby causing rates for those who remain to go up further still, which then causes the health 37 to 40 year old customers to drop their coverage... and the cycle keeps going.

Thus, it's not so much the cost of health care is increasing rather than there are simply fewer people remaining to cover that cost.

What goes down, doesn't always come back up

2010-02-11T13:07:00.000-08:00

People often say in various forms that Silicon Valley is the bed of technological innovation and a huge driver of economic prosperity. I've lived here my entire life and would agree that our past history does support that in some respects, but I'm also aware of one simple truism: past performance is no guarantee of future success.

A report that was issued today by some pundits agrees with me: Silicon Valley still has a lot of fancy and cutting edge tech shit going on, but there are serious problems afoot as well. At a minimum:

Venture capital investments are down
Patent filings are down as well
The number of mid-level jobs has also gone down (cough, outsourcing of jobs, cough)

Additionally, there's the usual plethora of shit to blame on the California state government -- high taxes, crumbling infrastructure, crappy schools, etc. On top of that, the last decade or two has also seen the rise of other tech centers around the world, including Austin, TX, Bangalore, India, and various tech hubs on the US East Coast like Boston and Research Triangle Park.

This brings me to my point and it's that what goes down does not necessarily go up. In more specific terms, the economy will not simply "get better" again because it's gotten better in the past. As Andy Grove said in Only the Paranoid Survive, there are strategic inflection points in business (but also in life generally) in which the old way of things is lost forever. Case in point:

In the late 1990s, Napster came out which facilitated wholesale copyright infringement of music. The record companies, of course, sued Napster out of existence, but then popped up a whole slough of similar services. The ones I can think of off hand include Kazaa and Morpheus, but I'm sure there are tons more. Before Napster, the record companies forced consumers to buy songs by the album. Now that Napster is gone, are consumers back to doing that or have you been living in a damn cave for the last decade and never heard of iTunes?
Years ago, the US still relied on Pony Express riders to deliver mail and other packages around the country. Then the telegraph was invented which allowed messages to be sent long distances without the need for someone to actually hop on a horse and hand deliver the message. When the first Pony Express riders found themselves without work, I'm sure someone must have thought 'Don't worry, this telegraph stuff is just a fad -- we'll be back to hand delivering messages in no time.' And they were right, if you ignore telephone and email.
When the first automobiles started appearing on US roads in the early part of the 20th century, they replaced horse drawn carriages. Did carriage drivers get displaced? Sure. Did some of them think that cars were just a passing fad? I do. Were they just a passing fad or did they represent an inflection point in which technology changed forever?
When the first manufacturing jobs in the Midwestern US started going overseas to China, Mexico, and the like, do you think those manufacturing workers stood around and said 'Don't worry, those jobs will come right back in a jiffy -- no one's ever going to buy something made in China anyway.' When outsourcing of engineering jobs first started in Silicon Valley in or around 2001, that was the sentiment a lot of people here echoed -- that the jobs would come right back to the US once the economy picked up. Some jobs did come back -- most notably Dell's executive level telephone customer service -- but for the most part, I'd say they haven't. And unemployment (currently 11%) in Silicon Valley has languished for the better part of this decade. Older tech workers find themselves increasingly having to start over again in their 50s and 60s. Coincidence?
And, finally, something more recent: when Google, Yahoo, and others first started putting maps on the Internet, I'm sure the paper map makers weren't worried -- 'A map on a computer screen? Ridiculous. You can't take a computer screen into the car with you. You'll always need paper maps.' Can you still get a paper map? Sure, but it's a lot harder as more and more people use Internet maps instead.

Lastly, from a general logic perspective, the idea that the good times will always return is silly -- if they did always return, then nothing permanently bad would ever happen.

My 2009 Persons of the Year

2009-12-30T19:13:00.001-08:00

Last year I began a tradition of naming someone my Person of the Year, usually someone who did something newsworthy that year. There are no formal criteria, but I consider what the person did and what it personified. Many things can count -- the inaugural winner was a woman (who later contacted me!) from Arizona who went out for a jog in the desert and got attacked by a fox who ended up biting her on the arm. A typical jog in the desert you might say, but here's what made the woman a badass and my 2008 Person of the Year: the fox wouldn't let go so the woman jogged the mile or so back to her car WITH THE FUCKING FOX STILL ON HER ARM. She then somehow managed to dislodge the fox, throw it in her trunk and drive to the hospital.

For 2009, I had three contenders.

The first was US Airways Captain Chesley Sullenberger who, in case you've been living in a damn cave, landed an airplane in New York's Hudson river after he lost both engines to a flock of geese. (Damn'd geese!). FYI, Captain Sullenberger is a California native.

The second was Captain Richard Phillips of the cargo ship Maersk Alabama. In April 2009, Captain Phillips' ship was steaming past the coast of Somalia when it was hijacked by a group of pirates. Captain Phillips got his crew off (I think), but in doing so got taken hostage by the pirates aboard one of the Maersk Alabama's life rafts.

The third is actually a group: Captain Phillips was freed after5 days when said pirate hostage takers poked their heads out of said life raft -- and got them blown off by three US Navy Seal snipers on an adjacent US ship.

In a world in which laws are rarely enforced and people have forgotten that actions speak louder than words, there can only be one choice amongst this group of three.

For exhibiting ingenuity, selflessness, tenacity, grace under pressure, and the strength of character to persevere against any and all odds to get the job done, my 2009 Persons of the Year are the 3 US Navy Seal snipers who in a split second stood up for what was right in the world by rendering swift and deadly justice. Those 3 brave men will remain anonymous forever, but wherever you are, gentleman, this American salutes you.

Good things come...

2009-11-21T12:04:00.000-08:00

To those who wait. Yesterday, I was notified that I passed the July 2009 administration of the California Bar Exam. My feeling at the time of the exam was that I would pass because it ended up being easier than the practice examinations I had done. However, passage is never guaranteed because there is always the chance that you may draw a bar grader who, despite being a lawyer, just has no idea what you're talking about. As a former engineer, I was particularly concerned about this, especially if I drew the stereotypical "liberal arts" attorney.

What I think drove me a lot these last few years was that some people -- more than 1, but not by much -- doubted that I could do it. I know now -- and I likely knew then as well -- that while few engineers and scientists go to law school, enough of them do it that you have to be a complete turnip (no offense to turnips) to think it earthshatteringly unusual.

However, when I began seriously applying to law school some years ago, that was the sentiment I encountered. That law was a waste and that a technically-trained person like myself had no business whatsoever going into it. When I persevered, that sentiment turned into active disdain: I would never make it into a law school, and even if I did, I'd never graduate and I'd certainly never pass the California Bar, one of the hardest Bar exams in the nation. One of the supervisors -- a hardcore and very narrow-minded physicist -- I had at the time was the worst. He knew me quite well, my having demonstrated my abilities (mental in particular) to him on numerous occasions. If anyone was in a position to write a glowing letter of recommendation for graduate school for me, it was certainly him.

When I asked, he said sure, that he'd be glad to. He was quite well connected in the scientific community we worked in and with his recommendation, I likely could have gone to any number of schools. However, when he found out it was for law school (versus graduate school for a doctorate or masters degree), he said no.

Racial stereotypes

2009-08-16T21:12:00.000-07:00

This posting is not in response to the Henry Louis Gates arrest that occurred about a month ago, but that arrest did get me thinking about this topic so it was indirectly the source.

Incidents similar to the Gates arrest happen periodically where someone is profiled based on their appearance. Just this past weekend, for example, some really famous and important Bollywood actor from India was stopped at Newark Airport in New Jersey, allegedly on suspicion of being a terrorist. Why? I think his last name was Khan, which is allegedly a common name for terrorists, I guess. (Sorry, as you can guess, I don't follow Bollywood movies, although I probably should in order to keep up with my Renaissance Man image).

Anyway, when the misunderstanding behind the incident is resolved, the news will invariably show someone who says something to the effect of "This incident just shows how much more work we need to do to combat stereotypes and racial prejudice", etc. Some outreach event (diversity forum, tolerance workshop, etc) usually follows until the media attention fades.

The fact that these incidents keep repeating tells me that the workshops and forums don't work. What does? As usual, the solution is up to every individual and here it is: play against type.

What I mean by that is this: surprise people by playing against stereotype. For example, suppose that a stereotype is that Asian students only excel in academics. Break that by being an Asian student who also excels at something else, like sports. If the stereotype is that Jews are cheap, then surprise people by being a Jew that tips generously. If the stereotype is that young black men are all drug dealers or gang members, surprise people by staying in school and going to college. If the stereotype is that all Mexicans are lazy, break that by being the hardest-working, least-lazy worker there is. Most stereotypes are formed by people based on what they see in their own lives which means if they get surprised enough, the stereotypes will (or should hopefully, anyway) start to fade.

And that's how change happens.

The New Silicon Valley

2009-08-13T21:53:00.000-07:00

Allegedly, the recession of 2000/2001 ended sometime in 2001-2002. The economy then went on an alleged tear from 2002 through 2007/2008 when it went into the current toilet it's in. That's what the government says, the official figures say, etc. If you instead, however, look at reality, the story is a bit different. A lot of people -- particularly engineers who lost their jobs circa 2001-2002 -- never found equivalent replacement work. What work they did find was usually inferior in some way -- less pay, less benefits, etc. My personal experience was that the 2000/2001 recession took away a whole class of jobs (high-paying, with benefits, etc) that never came back again. What jobs that were available from 2002 till 2008 were (again, in my experience) largely tied to real estate in some way, which as history has since shown, was all vapor.

Thus, there's a dissonance between real life (in which the recession still seems very real) and the government's official economic figures that say the precise opposite. I've struggled to reconcile this difference for a while as a pure academic exercise. Like anyone else, I trust my own senses over what the government tells me. As an aside, I'll remind everyone that the government's unemployment figure only counts people who are looking for work and that many now believe unemployment is significantly higher than what the government says.

Anyway, what got me on this was this story in the August 12, 2009 edition of the San Jose Mercury News (Silicon Valley still a center of the tech world, Page 1A). One worker interviewed for the story says that what he's seen change is that while innovation still happens in Silicon Valley, that's it. The more I thought about his statement today, the more I think he's correct.

When I was growing up, there were two general classes of workers in Silicon Valley. First, there were the innovators. The definition of this is really amorphous, but the idea is that an innovator thinks of or originates an idea and then works to reduce that idea into rough practice. This might be building a prototype device or coding a really crude version of the program to, essentially, prove that the idea (a) works, and (b) can actually be made into a tangible product that can be sold. The actual making of that product used to be done by the second group of Silicon Valley workers. I don't know what to call this second group, but if the first group could be thought of as leaders, then this second group consisted of followers. Most followers, I would say, are what we would call normal, middle-class people. Up until about 2000/2001, this system of leaders and followers worked fine.

Then the 2000/2001 recession hit.

The biggest consequence I remember that that recession brought about was outsourcing. Specifically, the manufacturing of tangible objects when to China while the manufacturing of intangible objects (computer code or routine office services like payroll processing) went to India or Eastern Europe . I don't know what the salary difference was then or is now, but I'm prepared to gamble (and I never gamble) that it costs less to have the equivalent task done in India or Poland than it does in the United States. Is the quality the same? Probably not, after you factor in a bunch of factors like experience of the worker as well as cultural and educational differences, but the cost difference was so much that you could, in essence, afford to suck at something.

I think that explains why some have said that the economy (generally, as well as in Silicon Valley) has stagnated: the innovators are still in Silicon Valley and, for them, life is still great. On the other hand, the followers -- who live in track-houses and used to populate the sea of windowless cubicles at most companies -- aren't doing so well, because the work they used to do has now been sent overseas. Sometimes the work comes back, even though it costs more in the US, for other reasons, like time zone convenience, but for the most part, I'd say the work is gone for good.

Is this a game changer? Not at all. This has happened throughout history time and time again, but this time it may be happening on a much larger scale.

More on that tomorrow.

Common sense when starting a company

2009-08-03T14:11:00.000-07:00

As is my usual habit, this is my first posting in quite a while, but the good news is that I should be able to remedy that from now on. You see, my life was recently very, very stressful, but now should get a lot better. Why you ask? Last week, I took the California Bar Exam and now I am in limbo until late November when I find out if I passed. Hopefully I did pass, but now that I've been through the process, going through it again won't be the end of the world. Disappointing, yes, but not the end of the world.

Anyway, since law school and the Bar exam are both over, it's time to comment on the real world again, and specifically jobs and the economy. Looking around, it should be really obvious that American society -- neigh, the world society -- needs job creation badly. By most measures -- availability of health insurance, cost of college education, housing affordability, etc -- the world seems to be moving in the wrong direction and I think all of that has to do with the lack of jobs. At the same time, however, it's also well-documented that many entrepreneurs and new businesses fail. It seems really obvious then that effort should be spent on reducing that failure.

This post is on one reason I think many companies fail: not every idea can serve as the basis of a company. Case in point, Carbon Motors.

For those of you who don't know, Carbon Motors is a company in the Atlanta, Georgia, area that aims to build police cars that are supposedly more high-tech and advanced than the Ford Crown Victoria-based police cars that most departments use. From what I've seen of the prototype, the Carbon Motors police car differs from the Crown Victoria police car in the following major ways:

Massive use of LED emergency lights on the Carbon Motors car. The LEDs are not bolted onto the roof like on the Crown Vic, but instead appear to be integrated into the car body. Result? Improved aerodynamics at a minimum along with the cost, reliability, and visibility benefits of using LEDs.
The Carbon Motors car has a turbo diesel engine which supposedly gets better gas mileage and has a longer service life than the gasoline engine in the Crown Victoria.
Suicide-style rear doors on the Carbon Motors car. Supposedly this makes it easier to stuff a handcuffed criminal into the back seat of a police car. I've never done that (stuffed or been stuffed) so I'll assume that's true.
Better integration of police equipment. It's no surprise that police cars have tons of extra police gear (radios, shotguns, laptop computer, various cameras, etc) bolted into them in whatever arrangement works. Functionality is very obviously the main concern instead of appearance or ergonomics. I would also guess that in a crash, a lot of this bolted on extra gear can dislodge and the officers involved may end up with a laptop embedded in their thorax. From the pictures I've seen, the Carbon Motors car does a better and neater job packaging all the extra police gear than is currently done on the Crown Vic.
The seats on the Carbon Motors car are supposedly more comfortable than the Crown Vic's seats (having ridden in several Crown Vic taxis, I can confirm that the Crown Vic's seats are awful). The seats are allegedly also designed for cops who wear lots of gear (gun, taser, etc).

I'm sure there are more differences, but I think the above captures the bulk of it. To be sure, the Carbon Motors prototype is impressive and the company has certainly built a better mousetrap, I doubt it's going to be successful as a company for these reasons that I hope the company has thought of.

Economics -- Carbon Motors appears not to have any factories yet. The E7 police car also seems to be the company's only product. Car factories are expensive, and I would guess that Carbon Motors won't make any money unless they make more models of vehicles across which they can spread the cost of starting and running their factory.
Sales volume -- I don't know how many police cars are sold in the US each year, but I would guess that it's a small sliver of the number of cars sold to civilians. Unless Carbon Motors plans to sell a civilian version of the E7 (and deal with the marketing, dealer network, warranty, and service problems), I don't see how Carbon Motors will get sufficient sales volume. Also, I don't see why anyone would buy a civilian E7 since all of the E7's benefits (bigger seats, integrated police gear, etc) are law-enforcement specific.
Cost -- I don't know how much a department pays to get a Crown Victoria police car delivered with all the gear and decals installed, but I would imagine that the E7 will cost more. Even before the economy went to shit in 2008 and municipalities started laying off cops and teachers, I had a hard time believing that departments would spend more for a police car unless that car delivered a substantive benefit. Better equipment integration, more comfortable seats, and a more durable and efficient engine seem more like comfort and convenience features in my book.
Engine service life -- The E7's motor supposedly will go for 250,000 miles and not the 75,000 or 100,000 miles a gasoline engine will before needing to be replaced. This advantage is only meaningful, however, if the rest of the car at 100,000 miles is still usable. If, for example, the body of the police car has been smashed up by some chases or the interior all messed up with suspect's puking and pooing in the back seat, then perhaps making the engine last twice as long really doesn't solve anything.
Redundancy -- Maybe the Carbon Motors people tried this, but it seems to me that the smarter plan of action here would have been to not start a separate company, but rather to talk to any car company that makes a potential police car. List out the concerns police officers have over seat comfort or equipment integration and see which company would be willing to sell you a car that meets those needs. If, for example, seat comfort was a big deal, I'm sure some company out there could make seats designed to accommodate tasers and pistols. If engine durability and efficiency was a big deal, I know Ford has a stable full of diesel engines that could theoretically be made to fit into the Crown Vic. It further seems possible to me that the center stack of the Crown Vic could be modified in some way to accommodate a policeman's laptop without having to create a separate company to manufacture a whole new type of car.

This idea of "not every company that can be started should be started" first dawned on me during the dot-com era of the late 1990s and early 2000s where every idea, no matter how ridicuous, got a corporate entity thrown around it. I certainly hope the Carbon Motors people succeed and I will gladly retract my sentiments if they do, but as of right now, I don't see how they're going to.

Automotive foundries

2009-06-13T11:55:00.000-07:00

Lots of stuff has happened recently -- I took the last final exams of (hopefully) my entire life, I graduated from law school, I've begun preparing for the California Bar Exam, and in the process of doing that, realized how utterly inadequate some of the Bar courses I took were.

But what I'm writing about here, though, is an idea that dawned on me about 2 weeks ago when I read that General Motors had sold the Saturn brand to Roger Penske. Now, I don't know Roger Penske, but apparently he used to be a race car driver and now owns a bunch of car dealerships. I assume he also is the namesake behind the Penske line of rental trucks.

Anyway, I own a Saturn and it's not a terribly bad car -- although I did have to fix quite a few things on it within the first 2 years of ownership, and I also have to routinely ignore a bunch of glaring faults like how noisy it is, how underpowered it is, and how its fuel economy is only okay given the power. What drew my attention with the Penske deal was that he's going to keep the brand alive, but seek out contractors to make the actual cars. In other words, Saturn will be just a brand and a retail network of dealers and parts distributors. The actual cars will be made by someone else.

This sounds unusual, but its not unheard of -- the BMW X3 is actually not made by BMW, but rather by a subcontractor is Austria (partially owned by the Canadian company Magna, which now is co-owner of General Motors' Opel brand in Europe). Until the economy turned to shit in 2008, I believe Porsche outsourced some production of its Boxsters to a contractor in Scandinavia -- Finland, I think.

All of this got me to thinking about the foundry model by which most every computer or electronic gadget is made these days. Years ago, I assume that every company who had chips or electronic gadgets to make designed it and build it at facilities they owned and operated. Starting, I think, in the late 1970s and early 1980s, specialized contract factories began opening up throughout Asia (mainly in Taiwan, but now in China too) that do nothing but reduce to reality a design that you provide them. Taiwan Semiconductor Manufacturing Corp (TSMC) is a major foundry. SMIC is another one -- I forget what it stands for, though, sorry.

For better or worse, the bifurcation of manufacturing from, well, everything else (sales, design, etc) has made electronic gadgets cheaper and made it possible for more companies (smaller ones, typically) to enter the market. From what I've heard, lots of these smaller companies are startups with only a handful of employees -- basically a company that could in no way afford to own or build its own factory.

A very similar parallel can be drawn to the Outsourcing business model that places like India, China, and the Phillipines are known for. In other words, by providing standardized and inexpensive computer programming and call center service, costs go down and the market becomes more available to more people.

And this got me to thinking: can this same foundry model work for cars? Would it be possible to trifurcate design, manufacturing, and everything else (or birfurcate into manufacturing and everything but manufacturing) so a small startup could be a player in the car business?

There'd be the obvious psychology problems, of course: cars are expensive and are kept for a long time so people don't want to spend a bunch of money on a brand that will disappear tomorrow (cough, Daewoo, cough).

You also have a sheer logistics problem. Cars today may share some mechanical similarity, but are still largely built from very dissimilar parts -- this is obviously why a Toyota Camry looks different from a Honda Accord which looks different from a Ford F-150. A single factory building all of these models would literally be filled to the rafters with parts. Organization would be hugely difficult.

On top of all this, I don't know if the economics of a foundry model for cars would even work since it would be squeezed two ways. On the upside, profit would be squeezed by having more companies playing in the auto industry (i.e. more companies making passenger cars = lower prices for passenger cars). On the downside, you'd have high costs as well, given the parts problem I just described and the massive organizational nightmare that would entail. The organizational nightmare might have indirect costs as well, such as training employees how to assemble dashboards in 50 different ways for 50 different models and the increased cost of repair/rework/warranty if an assembly mistake results.

Although something tells me that Morris Chang and a bunch of the other electronics foundry model pioneers in Asia were having this same thought/discussion about 30 years ago, and that turned out well didn't it.

The dealership business model.

2009-04-25T11:06:00.000-07:00

One of the predictions I made back in Januaryish time is coming true this week: Chrysler is allegedly going to file for Chapter 11 bankruptcy this coming week. Depending on how the public reacts and whether the bankruptcy goes well, I'd go so far as to say that Chrysler the company will permanently disappear. Personally, I'm not the least bit surprised. Between GM, Ford, and Chrysler, Chrysler without a doubt had the least appealing lineup. In bankruptcy, GM and Chrysler will certainly close dealerships which got me to thinking about how utterly ridiculous the dealership business model is for cars.

As I understand it, dealers (a) buy or lease a huge piece of land and put a building on it, (b) borrow several million dollars to buy a bunch of new cars in the hope that (c) some customer will walk in and be enamored enough with the options, color, etc to want to buy from the dealer's stock right then and there. This model works for ordinary retail where your turnover is high and the cost of each individual item in your stock is small. However, when you're talking about cars worth $15,000 to $35,000, it doesn't work for three big reasons. I'm sure there are more, but this is what comes to mind off hand.

First, you tie up a bunch of borrowed money in inventory that you don't know when you can sell.
Second, you have to maintain a huge piece of land to park all the cars and trucks you've bought with borrowed money. Huge pieces of land costs money as well. Even now.
Third, the dealer must also take a guess at what options future customers will likely want. Every passing day a vehicle sits on a dealer's lot costs money.
Fourth, as cars sit on lots too long, the vehicle gets discounted to simply get it off the lot. This benefits the consumer, but hurts margin and possibly ultimate resale value.

A much better solution, I think, is to have consumers go into a dealership to place an order for a car and wait for the factory to build it. I did that with my car and it took about 6 weeks, one of which was for it to be driven from the East Coast to California.
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The only reason I can think (again, off hand -- I'm sure there are more) to buy new vehicles with borrowed money in the hope that it can be sold someday is test drives. People will buy houses and hamburgers that haven't been made yet, but somehow won't buy a car. This sounds even more weird when you consider that in many parts of the US, a basic house is only ~$150,000, or roughly 7 times the average cost of a new car ($25,000).

But here's the solution for that: have a limited selection of models that exhibit all the options that are available. For example, if a vehicle comes with an optional leather interior, have a tester that has that. If a vehicle comes with a choice of 2 engines, have testers for each. If you work out all the combinations, I guarantee dealers will have to stock far fewer new vehicles than they do now. The number of combinations will be actually less than what the math says since some options can be displayed independently of one another. For example, leather seats and a V8 engine can be displayed on the same tester instead of 2 separate ones.

I have no problem buying cars this way and, if it leads to lower prices, I imagine many more consumers wouldn't either.

Scratching a 7 year itch

2009-03-23T00:57:00.000-07:00

In a few months, I graduate from law school. Depending on your perspective, it either caps a 7 year journey for me or merely marks the beginning of another. The former is not because it took me 7 years to finish law school (give me a little credit, will ya?) but it was 7 years ago that I finally decided that I would actually go to law school. Researching schools took time as did writing my essays, securing my letters of recommendation, taking my LSAT prep class, and, of course, actually taking the LSAT itself. (Oh yeah, and then there was that small task of earning money to pay for it all). Before actually deciding 7 years ago, I had tossed the idea around back and forth in my head since at least the late 1990s.

Why you ask? The short answer is that I felt law school was something that wasn't beyond my ability. The long answer is that as an engineer and scientist, I had learned not only how to describe things with math and science, but also that not everything worth describing can be described with math and science. But yet, I knew deep down (in my bowels, you might say) that the same logic and analysis (and even peace) I had found in science and engineering was also in the law. 7 years later, I can say with full confidence that I was correct.

That's not to say the road has been easy. It hasn't. I've seen more than my fair share of friends buy houses, get married, become parents, and get promoted. Me? I clung to a dream and when my birthday comes around this year, that dream will be reality. But aside from the occasional minor setback of my own doing, I'd say the overwhelming majority of my problems in law school came from being taught by a surprisingly large number of people who didn't know how to teach me. They may teach others perfectly well -- I was often in the minority when it came to who I deemed a "good" professor -- but just not me. I ask questions. When I'm asked questions, I will tell you what I think. I demand high quality of others, and especially of myself. I understand when I do something, not when I'm told. I do not -- nor have I ever -- blindly accepted something I've been told.

In writing that, I'm reminded of something an engineer I used to work with told me: "Andy, when you're out in the real world, assume everything you have been told is untrue, that everyone around you is either a liar or always wrong. Doubt everything and dig. Dig until you're satisfied that what you have is correct."

This engineer also had another saying "Do not ever be afraid to bend, cut, weld, or drill something. If it doesn't fit your needs, it's useless."

Thanks Charles.

I hate being right

2009-02-05T22:52:00.000-08:00

A lot of talk these days is about how many people are pinning hope for an economic recovery (at least in the US) on President Obama's $820 billion stimulus package now making its way through Congress.

The package contains a lot of what I'd term substantive, long-term relief (tax breaks on home and car purchases, for example) but it also contains a lot of money for spending that I can't quite fathom. Specifically, building new roads and bridges.

Now, all of you know that I drive a lot, so I'll be the first to say that America needs to spend on repairing its roads and bridges, lest there be another bridge collapse like there was in Minneapolis a few years back.

What I have a problem with, though, is that in today's modern world, most of the economic impact of building a road or bridge will come from actually building the road or bridge. In other words, once the construction is done, the jobs disappear and we'll have a bunch of shiny new bridges and roads that no one can drive on because we can't afford to buy cars or gas the ones we already have.

Some people have tried to convince me otherwise by saying that the construction workers will spend the money they receive on employees and supplies, like trucks that will benefit companies like Ford and GM. Unless the new road/bridge has some new-fangled capability (absorbs car exhaust, generates electricity from cars traveling on it, has a railroad track down the middle, etc.), none of what these people have said explains away the simple fact that construction itself does not create jobs that last beyond the actual construction. You need someone to actually live in the house you build (and actually pay the damn mortgage). You need a tenant for your shopping mall or office building who will pay rent.

It turns out that I, once again, am correct.

My 100th post: dedicated to Oscar Grant

2009-01-04T22:17:00.000-08:00

On New Years day 2009, at approximately 2 AM at the Fruitvale Bart station in Oakland, CA, 22 year old Oscar Grant was shot and killed by a Bart police officer. Now, unfortunately, shootings in Oakland are quite frequent and I didn't pay attention to it.

Until today, when I saw video of the actual shooting as taken by an eyewitness' cell phone.

The video shows, without equivocation three things. First, the victim, Oscar Grant, was lying on his stomach. Two, Oscar Grant had a Bart police officer restraining his head, another down by his hands, and another standing over him (in other words, 3 professional, armed police officers restraining 1 civilian). Third, the video shows the officer by Oscar's hands suddenly stand up, remove his gun from his holster, aim said gun at Oscar, and shoot Oscar in the back.

My friends, I didn't know Oscar Grant. Maybe he was a nice guy. Maybe he was a lazy guy. I don't know, and I frankly don't care. All I know is this: Under the 1985 US Supreme Court case of Tennessee v. Garner, a police officer is only entitled to use deadly force against a suspect if he has probable cause to believe that that suspect poses a danger of death or serious injury to others. Any other use of deadly force violates the suspect's Fourth Amendment rights under the Constitution.

I read Tennessee v. Garner ages ago, but as I recall the fact pattern, the officer there would have been more justified in shooting than in Oscar's case. Garner, as I recall, was an unarmed man (the officer could tell) who was shot in the back of the head by a lone officer in a dark alley at night as he tried to flee. Garner was not (a) lying on the ground, (b) was not outnumbered by the officers 3-1, and (c) the officers did not have other modern means of restraint available, such as tasers and pepper spray.

So, if the officers in Garner were found culpable, I can't imagine how this Bart officer won't be (a) fired, and (b) charged with at least second-degree murder.

Thanks to YouTube, here is the actual video of the shooting. It starts about 6 minutes in and the actual shot (it's hard to see) is at around 8:30. If you want to see the actual video from KTVU news, it's here

My 2008 Person of the Year

2009-01-01T13:34:00.000-08:00

I begin a tradition today with this first posting of 2009. Time Magazine names a Person of the Year each year (Barack Obama this year -- bet they had to think hard for that one) and I will too, specifically someone who did something this past year against all odds and truly embodying the American spirit of anti-stupidity.

Barack Obama did do great things, but my inaugural Person of the Year is Arizona resident Michelle Felicetta. Now I know what you're thinking -- the Michelle Felicetta? Yes. On November 2, 2008, Michelle was on her usual jog at the base of Granite Mountain in Prescott, Arizona, when she was attacked by a rabid fox. The fox bit her first on her foot and then on her arm. Michelle, naturally, did the logical thing: she ran the mile back to her car with the fox on her arm, threw it in the trunk of her car, and drove to the hospital.

I dare anyone out there to top that. That is awesome beyond words, and so, Michelle Felicetta, I crown you 100% Anti-Stupid's Person of the Year. Here she is on David Letterman's Late Show.

Oh, and I have 3 predictions for things that will happen in 2009: First, Steve Jobs will die. Second, General Motors and Chrysler will file for bankruptcy. Third, the economy will continue to get worse, although that's not really an insightful prediction since it's so obvious.

Stadiums

2008-12-27T21:07:00.000-08:00

Infrastructure spending in a minute, but here is another column I found today which (hopefully) sums up the point I tried to make yesterday about how Americans have become soft and how American Idol is the perfect example of it. It's another New York Times column, but this time it's by Bob Herbert entitled Stop Being Stupid.

Herbert's column leads me into my next point, though. One of the things I think about these days is how precisely the world and the US will dig itself out of the huge economic hole that we find ourselves in now. Politicians can talk all they want, but talking by itself does nothing. Sooner or later, someone has to go out and do some work.

But what work will be done? Some people -- including Obama -- have talked about spending a shitload of money on infrastructure repairs, much like how Eisenhower championed the Interstate Highway System in the 50s. At the time, I'm sure there were those who labeled it a stupid idea, but look what economic impact it had. At a base level, it created a shitload of construction jobs. I call the stadium effect because its the job-creation argument that always gets brought up when a pro-sports team wants a new stadium -- it'll create jobs.

The highway system had a larger effect, however. Once the construction jobs were done, however, the highways also drove demand for houses in the suburbs as people moved out there in search of a picket fence and backyard. People needed appliances for those homes as well as cars to park in their garages and drive to and from their jobs.

In more modern terms, let's say we go back to 1985, you were President Reagan, and I came to you with this decision: Should we give each man, woman, and child a one-time stimulus check of $500, or should we take that same amount of money (say, $100 billion) and spend it to interconnect all the computers of the world together into one vast network over which people can shop, conduct business and communicate, in the process of which, thousands of new jobs will be created?

In other words, do you want an Internet, or a stadium?

It seems to me that Obama, at least, is proposing more stadiums. Is knocking down a 50 year-old 4-lane bridge or school and replacing it with a brand-new 4-lane bridge or school really something with the potential to create jobs in perpetuity? I don't think so. Is replacing all fluorescent lights in federally-owned buildings with LEDs going to create jobs? I don't think so, but it will save a bunch of money we can then waste -- I mean, spend -- on other things.

Whatever infrastructure spending that does happen in the near future should be something that (a) improves the lives of many people either directly or indirectly, and (b) something that creates a new plane upon which entrepreneurs can act in to create companies and jobs that will actually spread wealth.

What meets (a) and (b)? Tune in tomorrow.

Rebooting America: American Idol

2008-12-26T20:38:00.001-08:00

I thought of this example in the last 30 minutes or so that I think illustrates the want of intellectual curiosity and attention span that I tried to explain in my last post and that Thomas Friedman is trying to explain in his column, Time to Reboot America.

Ready? Here it is: American Idol. I'm proud to say that I've never seen an episode, but I have listened to the winner's one hit song and can honestly say that they are generally not bad. I also, however, have seen the huge crowds and absolute pandemonium of people who try out for American Idol each year and therein, I think, lies the problem facing America.

Out of all the jobs in the world, out of all the truly urgent things that need to be done, out of all the problems that the world faces, the best thing that so many of these people can think of to contribute is to be a singer.

Is music and the arts important? Absolutely, but I think American Idol is emblematic of the softness we as Americans have developed. We don't want to do the hard work associated with being an engineer, a lawyer, teacher, or a business owner. No, we think that work is too hard and involves too many years of boring, boring school. We'd much rather get by on our looks as a model or actor or our physical ability as an athlete or our horrific lack of musical ability as either a musician or a singer.

Is it a small wonder then that countries like China and India (and everywhere else, really) consistently graduate more scientists and engineers than the US?

Shopping for crap

2008-12-26T19:40:00.000-08:00

Yesterday was Christmas. Today, ABC News (with David Muir) reported that Christmas sales were so bad that you can *haggle* in some big-name stores, like Macys and Bloomingdales. I haven't been to a mall in ages, but if the news is even half correct, it seems like the only thing retailers can do now is give their merchandise away.

Part of the lousy retail climate is, I'm sure, related to the economy, but there's another part, at least to me: there is nothing to buy so the focus now is not on getting new things, but rather getting new versions of old things.

Case in point, when I was a kid, I used to love going to Frys Electronics. I still look at the Frys ad, of course, but ever since about high school, I've noticed that there really isn't anything I want.

Flat-panel TV? No thanks. It looks cool, but that novelty will wear off in about 3 seconds. Plus, unless that flat-panel TV comes with new programming, it'll still be the same shit on TV. Xbox or PS3? No thanks. The games are too expensive and plus, I don't have the time to sit and figure them all out. Digital camera? No thanks, the one I have from 4 years ago works fine. New laptop? Old one still works fine. LCD monitor? Have one. Video camera? Have one. GPS thing for the car? Don't need one, on account of my excellent sense of direction.

I would say that for this whole decade, there really is no new item that consumers have really demanded. Flat-panel TVs were the one exception for a while, but then the whole "Damn, there's nothing on" problem keeps coming back. If you go back to the late 1990s, digital cameras were the other must-have consumer item. Why? Flat-panel TVs look cool, for one, but that's it which is why I think they're flaming out now. Digital cameras, on the other hand, really delivered a valuable benefit -- (easy development, easy editing, easy distribution, etc.) that consumers were willing to pay for.

On a grand scheme, I think this lack of any must-have products is reflected in Thomas Friedman's column this week entitled Time to Reboot America. I've never been to Hong Kong or Maryland, but I agree with his point: we have become a nation of people who do not partake in serious, productive work. We have finance, business, and marketing people who's primary concern is to foist merchandise on people or to move money around in order to make more, but none of that is productive in the long-term.

Look at our public schools. Awful. Our airports are decrepit, to say nothing of the air-traffic control system in the sky. Our roads and bridges are, quite literally, decks of cards. Our health care system costs a huge amount and is unfathomably ineffective. We, the country that invented the Internet, rank below virtually every other country in terms of connection speed, affordability, and use.

The causes of this mess are many and, as many people are able to bitch more effectively than I, I will do what I do best -- solve problems -- by offering one cause: We as Americans are soft. We've grown up in a society that has largely removed the immediate concerns of food, shelter, and warmth, thereby freeing us to pursue leisure and recreation all the time. We are not intellectually curious. We do not have an attention span.

Imagine, for a moment at least, what great things America could accomplish if we did. I, personally, wish for the day where the American public knows Hamid Karzai, Angela Merkel, and Gordon Brown as well as they do Paris Hilton and Britney Spears.

Panaceas

2008-12-22T14:13:00.000-08:00

As promised, here is yet further opinings about the future of our economy. But first, I have this youtube video to share. Apparently, a lady was interviewed by the local news at a mall and asked about whether the economy was forcing her to cut back on spending. Perhaps she's super wealthy, but her answer was that she wanted to get a Mercedes, but she had to downsize to a Lexus so she was definitely cutting back. Don't believe me? Well, screw off, here's the video. The audio is crap, but you can make out her answer.

Anyway, onto panaceas. At it's base, economic growth has to be driven by something. Sometimes it's a disaster -- like an earthquake, a war, or some cut in taxes, but usually it's driven by technology. Some new fangled thing is invented and someone commercializes it into something that everyone needs to have.

I'm not all knowing (yet), but I don't see anything like that in today's world -- and to be honest, I don't think anything like that has been around this decade. The last engine of growth was the Internet boom of the late 1990s and since the 2001 implosion, there's been nothing. Growth for the first couple of years was driven by housing, but that was only because interest rates had been cut to nothing. Construction took off like gangbusters, which then brought about today's mess that is the housing market where there are more foreclosures and repossessions than you can shake a stick at.

Anyway, the one thing that people point to as being the next driver of economic growth is clean technology -- you know, solar energy, wind power, etc. While that may sound comforting, I don't think that's the case, and here's why.

Previous technology drivers of economic growth had two components. First, there was the white-collar stuff (research, development, etc.) in which a lot of high-paying jobs were created. Second, there was the blue-collar stuff (manufacturing, installation, etc.) in which more jobs were created, albeit not as high-paying as on the white-collar side. To put in other terms, there was the white-collar jobs in which stuff was thought up and the blue-collar side in which things are replicated for deployment.

Unlike when the Internet was being commercialized in the late 1990s, I think most of the clean-tech growth will be on the blue-collar side. There isn't much going on in terms of thinking stuff up, like thinking up how to make solar panels. Instead, the growth is coming from the deployment side, such as the installation of solar panels made by existing processes.

There's nothing wrong with this blue-collar-only growth (growth is growth, after all). Henry Ford effectuated a great deal of this growth with his Model A and Model T cars in the 1920s and 1930s and, in the process, helped create an American middle class. But there's another difference which I think distinguishes what Henry Ford did and clean-tech of today: utility.

Years ago, people were saying that telecom would be the next big growth industry of the economy. Demand for fiber bandwidth would grow infinitely for years and years on end. People were analogizing fiber optic cable to semiconductors, Silicon Valley, and software. I think I was the only one I knew who was calling bullshit on the whole thing, and for one simple reason: utility.

Fiber optic cable -- like solar panels -- are good for one thing and one thing only: moving data (or generating electricity). Computer chips and hardware, on the other hand, are good for several things: playing games, doing scientific research, helping students do homework, animating movies, analyzing numbers, building machines, etc. Think of what computers are used for today -- generally, they do tasks that are too dangerous, too repetitive, or too fast for humans to do. Computers have a multitude of uses and that's why they created their own economic sector --- and why clean-tech and fiber optics never will.

A nation of whiners

2008-12-20T15:20:00.000-08:00

Before you get too mad at me, the 'nation of whiners' comment was actually former Texas Senator Phil Gramm's comment to describe the American people's anxiety over the economy. Problem was that Gramm was serving as one of Senator John McCain's economic advisers during the just ended presidential campaign.

While I don't agree with Gramm's assessment, I do unfortunately, think that it's not as ridiculous as it would appear.

Unless you've been living with your head in your ass (again, not as ridiculous as it would appear), you know that the economy in the US and abroad is in the proverbial toilet. I've been through several economic toilets before, but the magnitude of this one surprises even me. Personally, I never thought GM, Mervyns, Sharper Image, and Polaroid would all file for bankruptcy. I never thought that so many banks would fail and the biggest economy in the world could be brought en masse to a screeching half by a couple of bad mortgages.

Anyway, as in any downturn, it seems like there are more people looking for work than there is work to be had. Very few people are getting hired. Those who do find that the wages and benefits (if any) are meager. And that brings me to my point:

Jobs don't just create themselves. Wishing and hoping for a job won't make one appear. Jobs exist because someone had an idea, didn't let go of that idea, sought out the resources to make that idea into something, worked hard at it, and (most likely) built a company out of it -- a company that employs people.

It's times like this that I think of news stories I read about how in the Midwest and the South there are routinely 10 to 50 people applying for every job opening. (When Kia opened its car plant in Georgia a few years back, I believe they had 40 people applying for every opening.) How governments bend over backwards to offer tax breaks and free resources to just get companies to locate factories or offices in their area. Do I think people like working 2 jobs, commuting 2 hours a day to go to work, or living away from their families for weeks or months at a time? Not even. They do it because they need money and, unless you're going to commit a fraud on Wall Street, the only way to do that is to get a job.

Society clearly needs jobs then. Instead of just hoping that times will somehow magically get better or railing about how globalization is to blame or how the government should give us a bail out, why don't we as a people buckle down and put our heads together to create some new jobs? Encourage an entreprenuer, patronize a small business, volunteer your expertise to make an existing small business leaner and more efficient. That's hpw we'll help ourselves and make tomorrow better.

I'm a pessimist about most things, which is somewhat of a downer, but the upside is that I'm very rarely caught unprepared. I see lots of people these days just hoping that if they hang on long enough, times will somehow get better automatically. To those people, I have one thing to say: get a life. Hope is not and never will be a course of action. Things improve as a result of hard work and diligence. Right now, I don't see any potential engines that will pull the global economy out of its malaise the same way automotive manufacturing did or the Internet did. There just isn't anything out there. The only thing that people seem to consistently say is that clean technology (solar, wind power, etc.) will drive tomorrow's prosperity.

I don't necessarily disagree with that, but I don't think its going to be anywhere near the panacea people expect it to be. But that'll be for tomorrow to explain.

Bailouts

2008-12-19T16:01:00.000-08:00

So I think I'm past the point where I feel bad for not blogging. I know I should, but the obligation of having to do it is just a gigantic pain in the ass sometimes. Or all the time... anyway.

A bunch of stuff has happened, but I'll stick with just this one for now: this morning, President Bush -- no friend of labor, by any means -- decided to bail out General Motors, Chrysler, and -- to a lesser degree -- Ford. It's for $17.4 billion and there are a bunch of conditions, which is why I'm a bit mixed on it.

On the one hand, I understand that GM, Chrysler, and Ford directly and indirectly employ shitloads of people and -- even though those three have been losing marketshare and money for years -- they are too big to fail.

On the other hand, being a car guy, I can't help but think of the following:

Ford and the Pinto memo.
The Pontiac Aztek
How General Motors saved pennies by building my sunroof out of plastic instead of metal. It then promptly broke.
How Chrysler is all things HEMI.
How the PT Cruiser is now the most dangerous small car in America.
How Ford's modular 4.6L V8 is -- while capable -- an antiquated engine that produces less horsepower and less torque than smaller engines (like the 3.5L V6 Honda puts in the Ridgeline) and yet consumes more fuel to do it.
How, for the longest time, the Big 3 tried to cut every possible expense when it came to the materials they used in their vehicle interiors.
How the Big 3 thought 0% financing and employee pricing for everyone with a pulse was a fabulous idea.
How the Big 3 believes that a poorly designed vehicle haphazardly assembled out of the cheapest possible materials could be compensated for with advertising.
How Ford decided that it was worth it to save a bit of money in making the 2009 Ford Focus by fitting drum brakes in the back instead of the disc brakes in the front.
How the Big 3 (and to be fair, many foreign automakers) fought California's attempt to increase fuel efficiency standards. In other words, instead of engineers and scientists, the Big 3 brought out their lawyers.
How the Big 3's UAW contracts require that workers be paid 80%+ of their normal salary, regardless of whether the vehicles they make are selling.
How the Big 3's UAW contracts pay for job banks where workers get close to their full salary for, essentially, sitting on their ass all day.
How GM killed the EV-1 electric car in the same year it brought out the Hummer H2.
How the Big 3 (and, increasingly, Toyota) have consistently opposed any attempt to increase fuel efficiency standards with, among other things, the refrain that "fuel efficiency means smaller cars and that means you'll die in a crash". (Cough) air bags (cough) stability control.
How, until recently at least, every passenger car from the Big 3 was not something you wanted to buy, but rather something you could stand to rent.

Those are just some of the major points I can think of off the top of my head. Perhaps they are not entirely accurate, but the general idea is correct. In short, the soon to be not so Big 3 may have fallen on hard times as the credit markets have dried up, but anyone who says that they are completely faultless is either delusional or smoking 30 kinds of crack.

In the broad scheme, though, this bailout doesn't even address this point: even if the Big 3 get their shit in order, people just aren't buying cars, be they foreign or domestic.

Which means that come March, the Big 3 will be coming back to ask for even more money.

Hell hath frozen over

2008-11-05T00:33:00.001-08:00

Yesterday, the people of the United States elected Barack Obama the first non-white President. I like to think that I'm fairly open-minded, but even I have to admit that I didn't think Obama could do it. Previous black candidates -- like Jesse Jackson -- were always too far out of the mainstream for the average middle-class voter to identify with and I thought that Obama would run into the same problem -- especially with his name.

Part of Obama's victory is, I'm sure, due to John McCain's utterly ridiculous campaign. The disaster that is Sarah Palin surely didn't help, nor having the most unpopular President in history being the incumbent from your party. But still, I have to say I'm a bit surprised that the American people -- just a generation past the Civil Rights movement put externalities like race aside and, for once, elected the better qualified candidate as President.

Now, you know that this means there's room for an Asian-American President.

Huh ... who knew?

2008-10-18T14:33:00.000-07:00

I was having a late lunch/early dinner yesterday afternoon in downtown San Jose. The closest place I saw was A Quizno's Sandwich, but because I was in a hurry -- when am I not, really? -- I bit the bullet and went in anyway.

It was a pleasant afternoon so I decided to have my sandwich outside on the patio and people watch, although I ended up laughing at all the really-bored looking people waiting for the light rail train.

I stopped laughing, however, when a homeless man came to the trash can I was sitting next to. He had long hair, was really dirty, and, consequently, stunk up the place. I saw him set his bag of aluminum cans down and rummage through the trash can. I presumed he was looking for more cans, but I realized he wasn't when he pulled something out of the trash and asked me "Does pesto taste good?" I looked over and he had pulled out a box of pesto pasta that someone had thrown away.

Intuitive as I am, I figured out that he was searching for food, not cans. I don't know why, but it suddenly dawned on me that I could buy this obviously-hungry man a meal.

So I did: a Quizno's traditional club combo with drink and chips. The man was so stunned that I had to explain to him that he was getting his own sandwich and not the partial one I was having.

Best $6.27 I ever spent.

Age

2008-10-09T23:44:00.000-07:00

With all the talk about John McCain being older than dirt, it's gotten me thinking about age. In McCain's case, I think his problem (or, more accurately, one of his problems) is that his age is the first thing you see. When you think of McCain, you don't think of a guy running for President, but rather an OLD guy running for President. It's like that scene in Guess Who's Coming to Dinner where Sidney Poitier says "Dad, you think of yourself as a black man while I just think of myself as a man".

Anyway, in the last 10 years of working with various people, it's occurred to me that a lot of people have age all wrong. Most people worry that their age becomes a liability as they get older -- both in the working world and their personal life. However, if there is any liability, it's very rarely the age itself. What is it then?

One word: irrelevance. People let themselves become more and more irrelevant as they age and from that irrelevance is borne the liability that worries them. How precisely? It could be a small thing like having a wardrobe that's out of style or being unwilling to learn how to use a piece of ubiquitous technology. Or it could be something larger, like a set of knowledge or a way of thinking that only applied in the world of yesteryear. Nowhere is it written that we have to stop doing certain things (like going to school or exercising) simply because we have a few more gray hairs or a few more wrinkles. Nor is it written anywhere that you have to stop having fun now that you're a parent.

So how does one prevent irrelevance? Easy -- always learn, always adapt. Remember that today is a brand new day and no one cares -- good or bad -- what you did yesterday. That's such an obvious concept to me because Silicon Valley has always been like that. If you don't learn the latest and greatest thing, then you become obsolete and get replaced. I, for one, know that as a result of this blatantly obvious insight, I may age, but I'll never grow old.

Sarah who?

2008-08-29T21:41:00.000-07:00

I woke up today and discovered John McCain picked Sarah Palin to be his vice-presidential running mate. I then spent the remainder of the day trying to figure out why.

Now, I'll say to start that I'll most likely vote for Barack Obama come November. It's not a hard choice -- on the one hand, you have a young and charismatic speaker who can energize and motivate people by the thousands. On the other hand, you have an old and crotchety man who has no idea how many homes he owns or what the Internet is and how it works. Hmm... Yeah, that is a tough one ...

That aside, however, on first impression, I wonder 2 things about John McCain's choice:

He's old. Let's get that into the open. McCain is 72 (today, in fact, Happy Birthday John) and if he's elected, he will be the oldest person ever to assume the Presidency. Now, I'm the first one to admit that age is just a number, but the concern is clearly a valid one -- Will McCain die in office? If he does, Sarah Palin becomes President, which leads to the inevitable question of what her qualifications are. Well, less than 2 years as governor of Alaska (hardly a representative state), 6 years as mayor of Wasilla, Alaska (populatin: 6715), 4 years on the Wasila city council, and 2 years on the Alaska Oil and Gas Conservation Commission. That's it. No foreign policy experience. No economic experience. No military experience. And we're putting her a heartbeat away from the Oval Office?
Does Palin really bring anything to the ticket? Joe Biden, for example, shored up the big foreign policy gap that Obama has. In 2004, John Kerry selected John "Philanderer" Edwards in the hope that he would deliver Southern states. What does Palin bring? The soccer mom vote? Is Alaska a swing state? Clearly she doesn't go after the women who would've voted for Hillary because Palin is anti-abortion, pro-gun, and anti-gay marriage.

About the only thing Palin does bring is youth -- but then again, this is John McCain we're talking about so anyone is bound to look young next to him.

The only thing I can think of as to why McCain chose Palin is that his chances of winning in November are so low that there really is no harm in picking someone like Palin.

My last first week

2008-08-21T18:33:00.000-07:00

Today ended the first week of my last year in law school. It was my last "first week of school" ever, actually, but you never know. If you'd asked me some years ago, I would have said that my going to law school was crazy, but here I am.

I find myself at sort of a crossroads. First, a lot of my friends graduated in May so I find myself recognizing relatively few people. However, that is already starting to change, thanks to my having been on a panel welcoming a lot of the first year students a few weeks ago. The way it works now is that I know all the 4th year students, a ton of 3rd year students, none of the 2nd years, and a bunch of the 1st years. Strange, but then again, that's how I roll.

Second, I find it remarkable that the 4 years of law school have passed so quickly and that I have managed to work and pay for it all without going crazy -- or perhaps I've gone crazy already?? Curious. Anyway, first year seem to drag on forever -- mainly because of the "one-size-fits-all" methodology that first year is taught in -- but years 2 and 3 blew by, as I'm sure this year will too.

Third, I'm conflicted about jobs. On the one hand, the market for lawyers still sucks and there is no indication of it picking up by May of next year. That may change if Obama wins, but I think there are more fundamental problems -- high gas prices, budget deficits, and a bunch of houses with no owners -- that can't be fixed by a simple election. On the other hand, though, I don't find myself sad about the job market. Unlike many, I didn't come to law school with the goal of finding a job and practicing law. I came for the purpose of getting an education, and I think I've accomplished that through the various courses I took. I suppose I was expecting to find some part of the law that interested me so much that I'd want to practice it forever. Have I? I don't know. Perhap I still will, but what I've discovered though is that I love learning. Regardless of the subject, I can get into it if it's challenging and requires me to think.

Which leads me to this. I've known for a while that everything that exists in the world today was, at one time, just someone's thought. And that thought not only survived long enough to not be squeezed out by the next idea, but long enough to be made into something self-sufficient too. That got me to wondering this -- what if, for an instant, a bunch of law school grads thought differently and decided to do something besides practice law?

The stereotypical law school grad isn't what I'd consider "bright". They're not dumb, by any means, but they're stories are all pretty similar -- undergrad degree in some liberal art and then straight into law school, or possibly with a year off in between. My story -- and that of a lot of my classmates -- is different. Our undergrad degrees are in science or math. We had careers before coming to law school, careers in which we were successful, but ultimately, careers that we walked away from in a search for more. With our undergrad degrees, our law degrees, and our work experience, we could accomplish a hell of a lot.

Maybe we'd find a way to end homelessness or make our schools the envy of the world again. Maybe we could make our health care system actually provide care for the sick. Maybe we could take the replacement some scientist develops for gasoline and make it so that the average person could actually afford it and benefit from it. No longer would miracles of science only exist in the small scale. The sky, quite literally, is the limit.

But only if we think differently.