After the speech, the GOP had a chance to comment (attack) what Obama had said.  Representative Paul Ryan, R-Wis appeared on national TV to let us know that Democrats want to spend more and have not been able to create new jobs.  Ryan’s demeanor while reading his speech was considerably better than Obama’s.

Now lets get to the bottom of what needs to be done which has nothing to do with what was said during any of the speeches.  To set the tone we need to recall the visit from China’s president Hu Jintao.  During the visit two interesting things were clearly stated.  First, China does not want to hear the USA tell their country what to do or not to do regarding human rights.  In other words, Hu Jintao told the USA to mind our own business.  As we all know the USA has been forcing our believes and way of life (including capitalism) to all countries in which for business reasons there is some type of gain for American businesses.  Second, China will continue to design, manufacture and sell their products all over the world including the USA.  American businesses may want to sell to China, but that is not going to happen.  For example, China is going to design, manufacture and sell airplanes to compete with Boeing (USA) and Airbus (European).  China has somehow acquired / developed stealth technology for combat airplanes.  Not only that, but Embraer (Brazilian) is not going to build a plant in China because of the business repercussions.  This important fact was, is and will be ignored by American companies who do not care about what happens in a few years with the USA as long as they can get higher dividends next month at the cost of dozens, hundreds or thousands of American jobs that will never return.

So lets get back to what politicians from both parties (Democrats and Republicans) said last evening.  The only way to improve our economy is to design, develop, manufacture and sell our own products.  That is not going to happen.  American businesses (American Royalty and Wall Street) are only interested on the bottom line.  In other words, what the market bears.  What happens to the people and the country is not part of Capitalism.  As long as I have my money who cares about the rest of Naïve Americans.  All decisions are made based on business reasons ignoring moral and ethic ones.

About seven years ago, my sister, wife and I were driving in rural Indiana.  We landed in Indianapolis and rented a couple vehicles to drive to a small town to attend the wedding of my youngest son.  It was a warm summer afternoon and cornfields with luscious plants were all over.  As we drove for hour and a half the conversation took a turn into Globalization.  That is a word no longer in vogue.  Globalization meant to move production overseas (to China and India) in order to reduce the retail price of products and at the same time increase profits for the company producing the product and the company selling it (primarily Walmart and Sam’s Club).  At that time many American companies were furiously moving manufacturing and design overseas.  It was considered a poor business practice not to do so.  In addition there were tax benefits and ways to shelter some of the income overseas.  A win-win-win situation.  American companies would close their plants in the USA and build them in China.  Chinese people (not Americans) would manufacture the goods while learning and keeping some copies at their disposal to reverse engineer without the years of experience and hard intellectual work.  The products would then show up at retailers who could increase their sales volumes because the products were lees expensive.

In actuality the quality of good has dramatically dropped since manufacturing was shifted from the USA to China.  I have many personal examples of this.  Allow me to comment on just one.  At home my wife and I have a DeLonghi coffee maker.  We purchased the unit last summer.  The previous machine, from a different manufacturer, lasted about a year.  During the past few weeks I have had to dry up the counter in the mornings before using the coffee maker.  It leaks water from the base.  Sometimes I have to tilt the unit for it to drain.  This is completely unacceptable.  My family comes from northern Italy.  That is a very industrialized part of the country.  DeLonghi is headquartered near Venice (Venezia).  This model, among others, is manufactures in China (no quality whatsoever).

My wife and I walked down the aisle that displays small appliances (i.e., coffee makers) at Costco in Burnsville, MN.  Due to moral and ethic reasons I do not wish to step into a Walmart or Sam’s Club store.  We turned every single product to read the country where the appliance was manufactured.  ALL, including a different DeLonghi coffee maker model, were manufactured in China.  So what are politicians, Wall Street and the American Royalty thinking on how new stable and well paying jobs are going to be created in the USA when American Companies are designing and manufacturing all their products in China and hiding money to avoid taxes?  More important, what are Naïve Americans going to do when things just worsen in the next few years?  What is going to happen to the USA?

UNLESS things change and they change in the very near future, the USA will be a country with 15% to 20% unemployment.  We will become the equivalent to one more country (probably not like Germany but more like Spain) in the European Union.  The weak Dollar might (chances are that it will) be replaced by a different currency for international trade.  Naïve Americans with less and less skills, thanks to the poor K-12 public education system who wants everyday more and more money but produces results (high school graduates) that rank 33rd in the world.

America needs less government and less spending in order to reduce the deficit.  We need to realize that government jobs do not product good and services (cannot sell them to other countries in exchange of money) that are of no value to the economy.  We need laws to protect Naïve Americans and small businesses from career politicians, Wall Street and the American Royalty.  We need to stop imposing our flawed way of life to other countries.  We should revise the concept of Capitalism and adapt it to the new emerging world in which the USA is number two and China is number one.  Eliminate public education and make Naïve Americans responsible and accountable for their actions.  By working together we may be able to get the USA back to be number one.  Based on the current state of internal and world affairs this endeavor will take two to three decades.

THE SOONER WE STAR THE SOONER WE WILL GET TO OUR GOAL!

The Naïve American

One of the headlines on Google this morning is labeled “Obama Puts Jobs on Labor Day Agenda”.  Apparently Naïve Americans had enough of Obama, his promised Change and Democrats in general.  There are several seats in Capitol Hill coming up for re election and the polls appear to be leaning towards the Republican side.  Obama being a career politician has to follow orders from the American Royalty.  He needs to convince Naïve Americans that Democrats in power will help solve the problems in the USA (ha, ha ha).  If you believe this you need to educate yourself by reading books on American and World history.  The American Empire is collapsing (like all other civilizations have) and the only thing we can do is to attempt to slow down the process as mush as possible in order to soften the fall.

President Obama mentioned that the US economy is moving in a positive direction, jobs are being created; they are just not being created as fast as they need to, given the big hole that we experienced.  Stop for a second and think about this absurd statement made by a career politician that serves the American Royalty.

The facts are that the US economy is NOT moving in a positive direction.  The only to achieve this is to reach a point in which the US is producing services and goods that are desirable all over the world.  Every day we see in the news and in our communities that small, medium and large size businesses are closing their doors.  This is happening because our production costs are high compared to other countries and the innovation and quality of our services and products is reaching all time lows.  Nobody wants to buy American made products.  Just look around.  Most products that are offered by American companies are manufactured and starting to be design abroad.  The quality of our products is very low.  Things do not last what they used to and their prices are going up.  This is causing millions of Naïve Americans to loose their job.  Now, explain to me how building roads, fixing railroad lines and building new airports is going to help America to produce services and good that are desirable all over the world?

Another irrational comment from our leader is that the USA is moving in the right direction.  We just have to speed up the process.  Once again, putting money that we do not have into building infrastructure will never help.  I fully understand that on the Great Depression that helped the country but those were different times.  The USA was about to peak at that time.  In the 1950’s the USA started its decline.  Since then our country has lost grounds in almost all fronts.

Way too many reforms are needed.  From the political (no politician may serve on more than one office and never be reelected) to the educational (our K-12 has been doomed for decades and our higher education is starting to show problems) and economical (outsource design and manufacturing) fronts, just to mention a few, the USA is loosing grounds at an alarming state.

What we need is money.  I do not mean printing more Dollars to give away to BRIC (China, Russia, India and Brazil) but to immediately boost small businesses that develop products and services that are desirable world wide by dramatically reducing the tax burned and providing low interest loans (not $50,000 from the Small Business Administration which is completely useless) to get Naïve Americans back on track.

Please note that the American Royalty needs to be taxed and their salaries and bonuses need to be limited by law.  But just taxing Naïve Americans does not lead to new and better services and good desirable worldwide.  Increasing taxes to be used to provide for unemployment and infrastructure is like a charity.  We need to teach Naïve Americans to fish, not just give them free fish!  Do you remember a couple decades ago how bean counters and politicians were in the Globalization bandwagon?  Well any individual with a reduced IQ could have been able to figure out that Globalization was a really bad idea.  So why did it occurred?  Well American Royalty (i.e., CEOs, corporate executives, Wall Street) got their instant gratification (i.e., high salaries, bonuses, golden parachutes).  How about the rest of Naïve Americans?  Who cares.  American Royalty got their money.

On the long term, revamp our educational systems not by wasting more money in teacher unions but to improve in the methods used to educate our children and young adults making teachers and students accountable for their acts.

I know the suggestions presented in this blog will never make it because the ideas go against the American Royalty.  CEOs, Wall Street and politicians will never make a change because it goes against their interests.  We will have to wait until the point of no return to experience change.  That will sure come at a very high cost and will put America in the back burner for the foreseeable future.

Lets work together by being less greedy and complacent before it is too late.

The Naïve American

A few minutes ago I visited the White House web page (www.whitehouse.gov) and saw one of your pictures while visiting Cairo.  Looking good.  Hope your visit will result in positive improvements (CHANGES) to the US.

I would like an answer to one and only one question from the Naive American.  Before I pose it allow me to briefly provide some background and motivation for it.

A few weeks ago I was reading an article on the BBC on-line (http://news.bbc.co.uk) which called my attention.  The article was based on an interview of a woman that I will call Jane Doe.  Jane actually lives in Washington State.  For many years, Jane used to work as a mechanic in the aerospace industry.  I believe she worked in a Boeing plant.

As you well know, because labor unions, Jane was making very good wages for a person with her education and skills.  Unions raise manufacturing costs, which force employers to outsource and lay off Naive Americans.  Years ago Jane got laid off from her well-paid job.

A few months later, having many expenses including a mortgage, which is impossible to pay with unemployment benefits, Jane was lucky enough to get a job in the local government.  Given that the government does not produce many desirable goods or services her wages were quite less than while a mechanic, but she was able to make ends meet for a few years.

It was not until recently that Jane got laid off from her local government job.  Apparently Jane will be loosing her house in the near future.

The reporter interviewing Jane asked her to comment on the future.  Jane was quite realistic on her response.  Things are not looking good for her or for Naive Americans in general.  Most manufacturing jobs have left the USA and will never come back.  As the population increases, less well paid jobs for people with two to four year degrees will be available.

Changing the subject from Jane Doe to when I was growing up, I recall a joke that I saw in a magazine.  Perhaps you have run into a version of it.  Picture on the background a white board with some mathematical equations.  On the left side is a student wishing to get a passing grade on the subject.  On the right side one finds a perplexed professor trying to make sense on the answer provided by the student.  As you look closer into the math, a cloud is pictured with the following label:  “… and then something happens…” and the correct result is displayed.

I would like to modify the joke by replacing the student with you Mr. President, the professor with Naive Americans, and the mathematical problem with the simple question: “What CHANGES are you going to make in the US?” to get to the expected and correct answer “Stable economy as it was many decades ago“.  So far Mr. Obama, you and the rest of politicians and advisors always evade the difficult yet realistic issue that there is no well thought plan on how to solve the economical problems for us, our children or generations to come.

Please respond to the Naive American with a reasonable and realistic plan, not just a magic cloud, which will allow the USA to get from were we are to were we all would like to be.  I sincerely hope you prove me wrong with your response.

Yours truly,

The Naive American

It appears that the bailout for General Motors (GM) is being stalled by the US Senate.  The media immediately reacts suggesting that such action might cause a deeper recession.  Bad news travel fast and increases circulation and ratings.

I work for a small company in the Twin Cities of Minneapolis and St. Paul.  About a year ago our CEO asked me to look into some papers that attempted to model the economy using extremely complex mathematics and assumptions.  After a couple hours of reading I concluded that the ideas and concepts were ludicrous.  The economic events of the past few months proved that there is no way that mathematics is able to model human behavior.  As a matter of fact with all the time and resources (including super computers) the National Oceanic and Atmospheric Administration (NOAA) has not been able to accurately forecast such a simple thing as weather when compared to the complexity of human behavior.  What were Wall Street and investors thinking?

As usual, allow this Naive American to provide some simple facts.  When dealing with mathematics and physics we are able to define some simple to complex equations based on time.  Computers are able to run them over and over with or without modifications in an attempt to model or understand a behavior.  As far as we know, the universe we live in, time is a directed vector.  We are not able to go back or pause it.

Now for the specifics and simplicity, take the number of US Dollars in “existence” in an early month this year; lets say April 2008.  According to the Federal Reserves there were about $7.7 trillion Dollars.  Not all that money was currency.  To get a glimpse and a starting point to learn more about the money subject take a look at http://www.newyorkfed.org/aboutthefed/fedpoint/fed49.html or use your friendly web browser.

Not sure how much money there is in the entire world.  As a matter of fact it would be quite difficult to come up with such figure due to the different currencies and policies used by different countries.

I am not an economist but it would be safe to assume that Naive Americans and fellow humans in other countries have not decided in the past few month to take their cash and burn it or make it disappear (my wife is working on this challenge).  Another interesting fact is that the global population in the same period of time has not dramatically increased resulting in a shift in the ratio of US Dollars per human.  Please note that this ratio does not imply that every individual in the world has in his or her name or pocket the same exact amount of money.  As we all know the set of people that controls most of the wealth in the world is extremely reduced.  What is important is that the actual ratio has hardly changed in the past few months.

Take a look at the last report from the Federal Reserve http://www.federalreserve.gov/releases/h6/hist/h6hist1.txt that was published yesterday December 11, 2008.  Read the bottom entry in the report.  It appears that in November 2008 we had about $7.9 trillion Dollars (up $200 billion from April).  It is a fact that our friendly US government has “printed” additional Dollars in the past few months slightly increasing the ratio and possibly contributing to devaluation (but that is a different blob).

Another interesting fact is the statistics published by the U.S. Census Bureau regarding world population (http://www.census.gov/ipc/www/popclockworld.html) some of which I am listing:

• 07/01/08    6,706,992,932 <— a few months ago
• 12/01/08    6,740,422,806 <— current
• 07/01/09    6,786,743,939 <— a few months ahead

On a side note, perhaps we need to reduce the number of commercials for Viagra and increase the ones for Sultan.

If the Naive American is more interested in only seeing the US population then visit http://www.census.gov/population/www/popclockus.html to get constantly changing numbers.  Last time I checked we have about 305 million people living in the USA.

In conclusion, the world and US population are both growing and either has experienced a dramatic change in the past few months.  The US government has “printed” a small amount of Dollars in the past few months but nothing out of the ordinary.  So the Naive American wants to know what changed in the economy in the past few months and why the “gift” ($700 billion) the Bush administration gave to the US Banking Industry (banking should never be considered an industry) did not make a difference?

Perhaps greedy companies, organizations and people have “stashed” the majority of the $7.9 billion Dollars and wish to hold them in order to make more during this economic crisis.

If you fall in this category think about the current and future implications this decision is having and the irreversible changes that might bring to the American Way of Life.  This Naive American is calling on companies, organizations and fellow Americans to invest the “stashed” capital on companies that develop and manufacture high quality goods entirely made in the US.  America is all about Capitalism and Competition.  I say let’s prove it.  Such action would provide desirable and challenging jobs so much needed.