But isn't the Delorean the "Car of the Future"?

The Chevy Volt - which, despite its name, runs on less than 1.21 gigawatts - is the car being asked to "save" General Motors. This electric model will produce zero emissions for most Americans (those that drive less than 40 miles per day) and goes from zero to 60 in nine seconds. (No word on how soon it gets to 88 miles per hour.)

The full model isn't due until next year, and it's going through some growing pains. In the meantime, as Wired reports, the Obama administration is trying to kill it. The task force appointed by the President to oversee handouts to the auto industry doesn't think the zero-carbon electric car will be profitable anytime soon. According to this blue-ribbon panel - which, incidentally, gets paid whether or not GM goes belly-up - GM should focus on more immediately marketable vehicles, rather than vehicles which will be marketable long-term.

Somehow, the Obama Administration has succeeded in being more nearsighted than Detroit auto manufacturers.

If GM was flush with profit, it would be a good time to experiment with new technology. Unfortunately, they are currently being propped up with someone else's money. The Obama Administration wants a return on their investment, and they won't let things like the long-term viability of GM get in the way.

That's the downside of asking for money from a controlling interest that doesn't understand your business.

Your overconfidence is your weakness

I'm not sure why I bothered to read Paul Krugman's Sunday New York Times piece taking on the tax protest Tea Parties, but I'm glad I did.

Predictably - and without much imagination - Krugman uses the Tea Parties as a way to bash conservative/Republican values such as economic freedom and lower taxes. The tea parties, he charges, "have been the subject of considerable mockery - and rightly so." Krugman never really explains why it is right to ridicule these demonstrations, opting instead to bash the traditional bogeymen of Rush Limbaugh and Tom DeLay. But a venerated columnist signing his name to Democratic Party talking points and submitting it as his own work isn't particularly noteworthy.

Krugman shows his self-imposed limits when he makes the claim that the tea parties are "AstroTurf (fake grass roots)." The demonstrations, he claims, are "manufactured" by groups like FreedomWorks and Fox News.

The great thing about being an opinion columnist for the Times is exactly the same as the great thing about being a blogger: apparently, you can just fire off your thoughts without doing any research. If Krugman had, he might have figured out that the people who are conducting Tea Parties aren't being paid. (Sure, there are organizers and leaders, but show me a political rally - or, for that matter, a riot - that doesn't have someone calling the shots.) If he knew anything about FreedomWorks, he would know that they have a massive database of people who have signed up to participate in activities like this - on their free time, when they aren't doing their day jobs. Actually, he probably could have found that out by picking up the phone and talking to someone over there - like a journalist would. If he had bothered to research the tea parties, he might have found the multiple websites that purport to be the "central headquarters" of the movement.

And how much money would it take to "AstroTurf" this much ground?

All of this makes Krugman's piece less of a thoughtful expression of an opinion in a policy discussion and more partisan hit piece. Giving him the benefit of the doubt and assuming that wasn't his goal, Krugman betrays his an intellectual sloth: the Republican Party is to be ridiculed because he cannot conceive of rational people agreeing with the philosophy of a smaller, more limited government, or opposing a massive influx of government capital to solve any problem deemed worthy.


In the real world, there are at least two sides to every story. In Krugman's mind, we the people just don't think that way - precluding the need for "research" on which so many real journalists spend time.

You might even say that Krugman's reality is "manufactured."

Tea minus 7 days to Tax Day

If you haven't already filed, there's only a week left before income tax returns are due. If you've already filed, then you might be able to join one of the Tea Party protests of higher taxes going on nationwide.

The Tea Party movement has already spread to several cities - and in checking out their website, I wondered why I hadn't heard more about it.

Was it overt media bias? Partly - and left wing outlets like the Huffington Post are certainly paying attention. But as I like to mention whenever I talk about media relations, there's really no vast left-wing media conspiracy. Often, conservatives and libertarians just don't approach the media with their messages properly framed for a liberal audience (since most reporters are, in fact, liberals). The first sentence on the Tea Party website's About Us section - "A great evil has come upon this nation, and something has to be done" - probably feeds the media's groupthink that the movement is more fringe than freedom.

Fake it until you make it

Lost your job? Well, according to the New York Times, that doesn't mean you should stop going to work. The Times reported yesterday of the recession phenomenon of laid-off workers getting up, getting dressed, and going through the motions of employment. Career counselors quoted in the article say it helps maintain pride and good habits. Acting like everything is ok, or going to be ok, is actually helpful. Norman Vincent Peale was right.

It comes as no surprise, then, that since President Obama changed his rhetoric on the economy - shifting to the more positive, "fundamentals-are-strong" messages that he mocked last October - public optimism has followed - even with bad stories about unemployment numbers.

It would be an oversimplification to tie the eventual fate of Obama's presidency to the economy. Like Franklin Roosevelt, Obama's political future is tied to the perceptions of the economy. After all, FDR was re-elected twice while the Great Depression was still going on - and as his policies were extending it.

Sunday Funnies: Your monetary policy at work

While perusing Right Wing Video, I found this insightful clip that displays the inner workings of our government's monetary policy:

Ex-AIG employee names his own name.

In case you missed it, one of the recipients of the AIG bonuses, Jake DeSantis, turned in his resignation. DeSantis had been working for almost no pay ($1) with the promise that he would be compensated for 12 months of work all at once - compensation which may now be taxed at nearly 100%. His resignation letter, printed in the New York Times, chides AIG's corporate leadership for lacking backbone and accuses the attorneys general of New York and Connecticut of abandoning their oaths to uphold the law.

Down economy? Blame Twitter.

I can't figure out whether this is a joke or not - a Harvard economist blames Twitter for the economy's downturn, matching the rise in Twitter use with the falling Dow Jones average.

The article makes some provocative points - for instance, goes one theory, since Twitter is relatively new to the social media universe, many people are still trying to get the hang of it, leading to hours of non-productive use and monitoring by people looking for a productive use for micro blogging.

On the other hand, I'd suggest the opposite cause/effect relationship may be true. With a down economy, people are looking for new ways to make money - leading to the expanded use of a new communications device.

Recession? Not for some folks...

From the "A recession for some is an opportunity for others" file... Time reports on products which have done the best since the going got tough. Predictably, the products reflect a new national priority on conserving resources and spending smart. For instance, people are buying elements of food to prepare their own meals and snacks rather than prepackaged food, like baking mixes rather than delicious, delicious Tastykakes. It's nice to see, in Time's article, that people are establishing good habits out of necessity - plus it's encouraging that some folks are doing well.

And the headline ("What Sells in a Recession: Canned Goods and Condoms") reflects that no matter how the economy is doing, sex sells.

Girl Scouts 2.0

The Girl Scouts understand two concepts which have escaped the people at the controls of the economy: supply and demand.

The Girl Scouts of America have announced sweeping changes in order to boost membership. Recognizing that this isn't 1955 anymore, the concepts of campfire sing-a-longs, sewing and cooking, and even merit badges are being replaced by video conferences, financial responsibility training, and a leadership development curriculum. With more girls socializing online, blogs and online networks are emphasized (which gives the Girl Scouts a chance to teach about online safety, too).

Breathe easy, those peanut-butter-and-chocolate cookies aren't going anywhere.

Of course it's sad when traditions are phased out, but the Girl Scouts are reacting to the reality of dwindling membership - the organization was forced to change to meet the needs and demands of today. By clinging to those traditions, the Girl Scouts could serve nostalgia-seekers, but not the young girls who need them - and they would slowly die out.

Any industry seeking a bailout should heed the example of the Girl Scouts. And if the parallels aren't readily clear, maybe they could go door to door selling thin mints for a week or so - apparently, you can pick up pretty sound economic lessons that way.

Novel concepts from the 30s

Mashable mentioned an interesting trend yesterday: businesses are building blogs that are focused on their area of expertise, but not necessarily on their products. The idea is simple: by building a media outlet that interests their target demographic, businesses hope to lure more customers.

As the post notes, some journalists would argue that private companies are not credible sources. You can probably find these journalists' stories on the pages of your favorite newspaper - right next to the ads that fund those pages. Mass media has always relied on sponsorship - entertainment or information nestled around product pitches. Why take offense when the same thing happens on the internet that happened on the DuMont network in the 50s?

From the companies' perspective, using online media makes perfect sense. There are few better ways to extend your brand - for instance, Whole Foods runs a blog about food and recipes to help establish itself as an expert in groceries. And it's cheap to do - all the company really needs is the mental discipline to update a blog daily.

With ventures like this cheaper, easier, and more effective than traditional advertising, you can see why advertising revenues are declining. It's another way the business community will have to adapt to a changing world.

Lessons from the Calvin Coolidge Snack Bar: Diet Sprite, the Stimulus, and Creating Demand

I took two economics classes at the University of Massachusetts. One was ECON 103, a course in basic macro economics that taught freshman how to draw basic supply and demand curves. It was taught by a professor in a big lecture hall with smaller sections on Friday mornings (which were mercifully taught in classrooms that were just a few hundred yard from my dorm). I slept through most of it, and if it had been the only economics class I took, I might be shrugging my shoulders right now and saying "Stimulus? Sure, why not."

The second class I took was in a building named, appropriately, after Calvin "Silent Cal" Coolidge (a staunch supporter of free market economics) when our dorm's House Council decided to found a snack bar in the 19th floor lounge. I was one of the nerds involved in House Council - a quasi-governmental body which, up to that point, had focused on putting on educational and social programming that no one cared about and no one went to. We decided to put the tax money we had collected to a better, more productive use by launching a social hub for Coolidge residents. It also taught me a great deal about how business works.

We launched simply in Spring 1998, and sent one of our volunteers out to buy the first run of supplies. She came back with one twelve pack of every type of soda she could find - assuming that we needed variety. We learned that demand didn't call for a wide variety - people were just happy to have a place in the building where they could get soda cheaper than the vending machines. We also learned that no one likes Diet Sprite. To get rid of the supply, I gamely purchased about eleven of the ten cans our supply director bought (so I can personally attest to how horrible it was - seriously, don't ever buy Diet Sprite).

Essentially, I subsidized the purchase of a product no one wanted. If we had only looked at raw data about which sodas sold quickest for our next supply run, we might have thought Diet Sprite was selling like hot cakes and bought more. Luckily, we were a tight knit group, so I could express my distaste for Diet Sprite. (Have I mentioned it's sickeningly sweet? Stay away from Diet Sprite.) What I had done is artificially create demand.

Eleven years later, our economy is lagging and President Barack Obama - in a phrase uttered last week that has been retooled for this week's speeches and press conferences - is blaming lost demand. People are simply not spending money, so the government will start spending for them.

When I created demand, it was 50 cents per can and I spent my own money. But now, with this stimulus plan, we're all chipping in.

And this is the problem with any government action under the umbrella of a so-called "stimulus package." Government doesn't seem to understand the world of business - which is why President Obama can say, with a straight face, that an entity with a trillion dollar operating deficit "is the only entity left with the resources to jolt our economy back to life." (Seriously - he actually said that.)

Since government doesn't understand business, and doesn't operate by the same rules, how can we expect government activity to turn the business world around? Maybe Obama is wrong to say doing nothing is not an option. Maybe doing nothing - for a change - would be the best option.

In the meantime, I hope you like Diet Sprite; since no one is buying it, we're going to buy a whole lot more of it.

NOTE: After some cursory research, it appears "Diet Sprite" is the same product as Sprite Zero. You're warned.

SOMEONE has to be making money...

An economic recession is difficult on a personal level. I know several people who are looking for work right now, and still more who are worried about whether their job - or even their entire company - will exist next week.

That said, slow economic times provide a chance to make needed corrections. In his pro-stimulus stand up act at last week's Democrat retreat, President Obama mentioned our economy losing trillions in demand. The stimulus, he said, is a way to artificially create demand.

There are, however, industries which are growing by leaps and bounds. Aging baby boomers are making assisted living and home health care major growth industries. Demand for office administrative services is growing - probably because top-heavy companies are recognizing that two or more cheap, administrative-level workers get more work done than an expensive partner-level executive. Outplacement firms are booming, helping laid-off workers with career changes.

I've worked at a company that went through what was called a "right-sizing" - and while some employees saw that term as a euphemism for down-sizing, it seemed appropriate to me. Tough times force belt-tightening and discipline - whether in personal finances or a national economy. It promotes efficiency. And the industries that thrive are usually stronger because they find demand that transcends the difficult times - versus boom industries, like late-1990's dot-coms or mid 2000s real estate, that are based on people gambling to make a quick buck.

I drive less now than I did a year ago. The $4/gallon gas prices this summer led me to be more economical, and now I fill my gas tank usually about twice a month and no more. Similarly, I spend money a lot more intelligently now than I did four or five years ago with the knowledge that, even if I don't get laid off, raises and bonuses that I was used to in the past may not be available now - realities also make me work harder and strive to expand my job-related knowledge.

As I work with fellow conservative activists to build new organizations, we realize that we cannot rely on an influx of donations to help fund our efforts so we must be streamlined and put an emphasis on providing a deliverable service to potential donors.

Tough times are leading to the development of good habits for me. Hopefully the same will be true nationally.

Thanks, Washington!

Recent comments on the economy have shown just how much confidence we can place in our representatives. There are lots of companies out there that are failing or in debt because of irresponsible spending. Now that those companies are being supported by the taxpayers, President Obama and his pals are setting strict regulations - for instance, the people who caused this mess aren't allowed to give themselves raises. And they've come out strongly against those fancy "retreats" that are really just subsidized vacations.

It's good to see that folks with business sense are making decisions on the economic recovery.

Garth, do you smell bacon?

In order to beg for a piece of the stimulus pie, the U.S. Conference of Mayors released their list of "shovel ready projects" that they feel are good candidates for pork spending with funds from the stimulus package.

StimulusWatch.org is a great way to look at what America's mayors think is a good idea to spend other people's tax dollars on. More than a simple listing of projects in the Conference of Mayors report, Stimulus Watch is a wiki that allows citizen involvement - you can vote whether a project is necessary or not, list points for and against it, and make comments.

It seems to be working. Users are leaving comments and actually discussing the reasons for and against many of the projects. And while there are a few proposals which are drawing positive support, most are getting voted down. Citizens are also giving a bit of valuable: in response to a $3.5 million plan to refurbish the sidewalks in Old Town Alexandria, Va., one resident reveals that the city already makes regular repairs.

As Ars Technica notes, by opening the process up with a wiki-style interface, Stimulus Watch is light years ahead of the Obama Administration's definition of "transparency."

Waking up about Wal-Mart

Bruce Springsteen's Super Bowl halftime appearance came as he apologized for a promotional deal he signed with Wal-Mart to promote his greatest hits album. Springsteen feels Wal-Mart doesn't treat its employees well.

First off, where does someone nicknamed "The Boss" get off talking about employee conditions? The boss never knows what's really going on.

Second, there are some people Springsteen should talk to before chiding the working conditions at Wal-Mart. The first is Jason Furman, a key economic advisor to President Obama, who wrote a paper calling Wal-Mart "A Progressive Success Story" for providing low-income workers with affordable goods.

The other is Charles Platt, a blogger who gave an insider's account of life behind the smiley face as an actual Wal-Mart employee. I think it's been a while since Springsteen found himself inside a Wal-Mart, so I'll take Platt's word on what the working conditions are like.

Most of the criticisms about Wal-Mart come from unions - who would love to siphon off union dues from the paychecks of Wal-Mart's millions of employees. The bad news for them is that Wal-Mart and its employees have a good thing going - even if the Boss doesn't know it.

Bipartisan Opposition

Some corners of the mainstream media continue to chide Republicans for opposing President Obama's stimulus/bailout/recovery/handout/train wreck bill. But on the day where the new face of the GOP will be chosen, consider this:

Opposition to the bill was bi-partisan, with 11 Democrats joining the Republicans in voting "Nay." The same can't be said for the support.

Betting the farm

With stimulus/bailout talk dominating the headlines, President Obama's Department of Agriculture is doing something smart - reviewing the disbursement of farm subsidies to stop some payments. Currently, the flawed handout program sends cash to some people who have never planted a seed in their lives - and probably couldn't tell a hole in the ground from... well, you can figure that part out.

It's over a year old, but this blog post from Merry Olde England has a clever take on the ridiculousness of farm subsidies.

Yes We Cantor

A running theme of the early Obama Administration has been "process."

When will the President make good on his promise to pull troops out of Iraq? How will the President handle the suspected terrorists at Guantanamo? When will the government pass an economic policy to make everything better? White House Press Secretary Robert Gibbs has frequently referred to each situation as a process - giving the Administration a chance to delay and diffuse questions.

And as Mama Eltringham pointed out to me today, one Republican is turning that back on the Administration. Faced with a harmful economic stimulus bill, Republicans are looking to delay and diffuse too - delay (or destroy) a harmful bill and diffuse criticism that they are suffering from sour grape syndrome since November. So Rep. Eric Cantor of Virginia used the same language:

"The House is set to vote on the legislation as soon as tomorrow... Cantor said the House vote on the legislation 'is only the first step in the process.'"

Gibbs later credited Cantor with successfully pushing to publish the stimulus package online for public scrutiny - a tactic which not only delays the bill's passage, but forces the Obama Administration to explain spending $800+ billion in tax dollars during a time when working folks are pinching every penny to get by.

But don't accuse the Republicans of trying to sink the stimulus. They're just letting the process play out.

Harlem's Tax Revolution begins

With the mainstream media in full-scale Obama Love mode, it might seem Republican ideas like simplifying the tax code have fallen by the wayside. Luckily, filmmaker Evan Coyne Maloney has taken to the streets of Harlem and talked to the constituents of House Ways and Means Chairman Charles Rangle (who's had his own problems with the tax code). Maloney shows just how wide an appeal these ideas have.

Socialism is bad right?

AOL Political Machine Blogger Matt Lewis was on Fox News today squaring off with former Mondale campaign manager Bob Beckel. The quote that stuck with Lewis coming away from the segment was Beckel's defense of socialism: "What is wrong with some form of socialism in certain areas?" Here's the video:

Beckel poses a valid question. And with the Obama administration less than a week from taking the controls, it's a question that needs to be answered by opponents of a government controlled economy. If people are struggling to make ends meet, a scheme to nationalize industries will sound more appealing - and without a viable answer, could become a reality.