The Business of America

When Washington talks about regulating business, the rhetoric is usually couched as a way to keep large companies in line and protect consumers. In reality, these regulations tend to bite the businesses that do the most to help people improve their own position in life. Dan Flynn mentioned one such story this week: the ouster of a homeless bookseller Ken O'Brien from Harvard Square.

O'Brien, who sold books from a kiosk, was the subject of rarely-applied, antiquated permit laws that ultimately led the city to force him from his business. The city's defense is that O'Brien was lax in his permit paperwork; surely the Boston city fathers frowned upon the fact that his kiosk doubled as his sleeping quarters as well.

As the Globe reports, O'Brien had plans to expand his business - a model which could have helped line the tattered pockets of his fellow homeless people. Perhaps, with a steady job, a few might have graduated to non-homeless status, as O'Brien did for a brief time.

On what is, unfortunately, a completely unrelated note, here's a link to the city office charged with helping the homeless get back on their feet.

Contractual bonuses? F*** you, pay me.

"Now he's got Paulie as a partner. Any problems, he goes to Paulie. Trouble with a bill, go to Paulie. Trouble with cops, deliveries, Tommy, he calls Paulie. But now he has to pay Paulie."

-Goodfellas

I'm not thrilled that AIG is using $165 million in taxpayer dollars to fund bonuses. I'm even more mad that the government is bailing out businesses without checking where the money is going. But taking government bailout money is a little like taking money from the mob to keep your business afloat.

The AIG saga began in September, when the insurer asked for $85 billion, and continued in November, when the government gave them even more. AIG turned heads soon after with an executive retreat, and cancelled a second only after intense criticism. And now, it turns out, AIG has awarded lush bonuses to the folks who ran them into the ground - bonuses that were part of contracts signed a while back and which AIG is legally forced to honor. Clearly, they weren't worth a bailout to begin with.

"Business bad? F*** you, pay me. Had a fire? F*** you, pay me."

But President Obama and Congress are asking AIG to retract the bonuses - which would, of course, open them up for lawsuits that could be potentially more expensive. In essence, they're changing the terms of the bailout after handing out the money - and there's not much AIG can do about it now.

"Also, Paulie could do anything - like run up bills on the joint's credit. And why not? Nobody's going to pay for it anyway."

The currency of politics isn't money, but votes, and every politician only cares about re-election and legacy. The grandstanding by Congressional leaders, the President, and New York Attorney General/Gubernatorial candidate Andrew Cuomo is meant to win votes rather than stabilize a business.

Given those divergent goals of business people and politicians, the bailouts could wind up being more trouble for AIG than they were in before.

"Then, finally, when there's nothing left, when you can't borrow another buck from the bank, you bust the joint out. You light a match."

Storm Surge: Capitol Hill can't figure out new CrackBerries

Capitol Hill is rejecting the BlackBerry Storm. The Storm is the touch-screen incarnation of the portable email device which has become the bane of existence for the significant others of those who use them, the BlackBerry.

Apparently, when BlackBerry released this little technological marvel, many Members of Congress and their staff suddenly needed a touch-screen interface to answer their email. But now, since the touch screen doesn't work exactly like they'd hoped, they are trading their Storms in for older models.

These folks get their equipment from the Chief Administrative Office (CAO). In other words, like almost everyone else carrying these things around Washington (myself included), the denizens of Capitol Hill have their work pay for it. But because these are elected officials and their staff, the Storm surge on Capitol Hill was - you guessed it - your tax dollars at work. So were the tutorial classes the CAO set up on how to use the Storm.

TechRepublican's Chad Miles blames the difficulty on a disconnect with technology among many on the Hill who may be of a more advanced age. That's probably a big part of it. But some of it is the lack of risk - BlackBerries are consequence-free. (I've known people who have lost their BlackBerries in airports or after a night on the town, and their companies have sent brand new ones.)

If you or me were to buy a mobile device, and then decide a few months later we didn't like it, we might be stuck with it, depending on our service plan. We might try a little harder to make it work. In fact, we might not even buy it in the first place - we'd have to think long and hard about spending our own money first. Members of Congress and their staff have no such trepidation when spending your money.

Innovation Nation

A research firm released an "innovation heat map" last week - using a variety of factors to identify where new and exciting advances were taking place across several industries. Not surprisingly, Silicon Valley was the most innovative area of the United States. But somewhat troubling is they way innovation is tanking in some of our major cities: Philadelphia, Pittsburgh, Chicago, and other industrial cities are simply not keeping up with the times.

Washington, D.C., with its culture of federal government and bureaucracy, isn't even on the radar for this - which is no surprise, and which is probably a big reason why the tech team that funtioned so freely and successfully on the Obama campaign is meeting so many challenges during the Obama Presidency.

Washington's premium on the status quo and aversion to innovation will taint any aid failing industrial cities receive - and worse, will prolong those cities' economic woes.

Since it's March, imagine a young basketball player with bad shooting habits. The only way that player will get better is if he changes his or her shooting motion to adapt to the game. The federal government solution might be to replace basketball rims with hula hoops or lower backboards, but none of these will actually make the shooter better - and eventually, he or she will get to a level where the rules can't be changed.

(By the way, this is not some sort of clever metaphor for why the Washington Wizards and Georgetown Hoyas suck this year.)

Jin-ed up?

Without mentioning him once, Governor Bobby Jindal went a long way toward recapturing the formula for Republican success which Ronald Reagan first captured nearly three decades ago.

Despite widespread criticism - even among Republican voices - his response to the unofficial State of the Union address last night struck the right tone for the GOP moving forward.

Unlike the gaggle of 2008 GOP hopefuls who felt they could excite their base by bandying about buzzwords like "conservative" and limited government," Jindal illustrated the conservative view of government with stories. He recounted his commiseration with a local (Democrat) sheriff when federal bureaucrats stood in the way of Katrina rescue efforts. He talked about stimulating Louisiana's economy by cutting taxes and promoting business. He talked about reforming education to empower people.

(Incidentally, in one of the poignant lines of his speech, Jindal even took back Katrina - the issue that served as an illustration for Democrats' accusations that George W. Bush had lost touch with America. Jindal turned it around: "Today in Washington, some of us are promising that government will rescue us from the economic storms... those of us who lived through Katrina -- we have our doubts.")

Most importantly, Gov. Bobby Jindal talked more about what he was for than what he was against. The running theme of his speech was a line he got from his Dad: "Americans can do anything."

And in that optimistic wisdom is the conservative message. We oppose bigger government not only because it doesn't work, but because it imposes restrictions that take away the ability for Americans to use their own ingenuity and creativity to solve problems - a formula that has worked for 233 years and counting.

It isn't enough to say it - voters need to see it. Which is why Governors like Bobby Jindal are still the best torch-bearers for a renewed GOP brand. And while the detractors on the right - who were likely looking for their own version of a "conservative Obama" pan his speech, they must remember that one person will not resurrect the party.

Bobby Jindal is a piece of a much bigger puzzle. For the Republican party to establish consistent electoral victories, they need to paint a picture of a positive party with answers - and like a puzzle, creating that picture requires multiple parts.

Power vacuum

The Washington Post painted a great picture of the evolution of Your Nation's Capital in a piece that ran yesterday.

The Post's Joel Kotkin points out that DC is unique among national capitals in that it was not a significant city before it was chosen to house the federal government - and even afterward, its growth was slow because American federalism concentrated power elsewhere. But as power became more centralized in the 20th century - especially in the last 30-40 years - Washington has grown in size and cultural significance.

At the same time, Kotkin reminds us, other American cities have suffered crises of identity; Detroit's auto makers, New York's financial barons, and others have been "forced to kiss Washington's ring." Businesses are moving their corporate headquarters here to be closer to the machinations of government.

Like most federal initiatives, Washington is synthetic. Cities like New York, Philadelphia, and Boston sprang up on their own because of their access to ports and commerce; Washington was placed strategically; it has planned by a relatively small committee of officials; and its growth has been fueled by money taken from other parts of the country.

The problem with government solutions

The State of New York is in a fiscal crisis thanks to a bloated budget, and Governor David Paterson has responded with a budget package which hikes fees and taxes. New Yorkers are also facing budget cuts to programs which they have come to rely on.

The problem with using government as a crutch to solve society's ills is summed up nicely by Randi Weingarten: "It takes a lot to make sure there's a program for kids... but it takes very little to have this whole thing collapse." A teacher's union rep, Weingarten is ironically among those trying to squeeze into a crowded space at the budget trough.

The problem, as Weingarten astutely points out, is resting important personal needs on a system that so easily folds under its own weight. By trying to do too much, government ends up helping no one.

Perhaps another New Yorker said it best. As Billy Joel sang on an unreleased track, "The Great Wall of China": "You take a piece of whatever you touch / Too many pieces means your touching too much."