Response to "Turning Hustlers into Entrepreneurs"

·         Apr 27, 2010

Response to "Turning Hustlers into Entrepreneurs"

"Turning-Hustlers-into-..Entrepreneurs" discusses the possibility of increasing micro-credit in order to support independent "black market" business people.  As someone who has been running a successful off-the-books business for several years, I believe the major obstacle is not a lack of credit, but rather a government which is geared toward big business.

As the examples in the article illustrate, people are already doing what they are doing, without capital.  What they lack is official legitimacy.  Many entrepreneurs, such as myself, would love to "go legit", but it is not a realistic option.
I understand and support the idea that government regulate business to protect consumers.  The problem is that government does not take the size of a business into account in the requirements it imposes on operating legally.

For example, a single guy with a pick-up truck doing local deliveries pays the exact same state license fee as a company with a fleet of semi trucks.  The  least insurance available to him is a million dollars of coverage with a 1-2 thousand dollar annual premium, even if he never comes close to transporting a million dollars worth of goods.   Every city he works in requires its own separate business license.  If he needs to hire a subcontractor on occasion, he needs to buy worker's comp insurance at a minimum, and possibly more.  Being self-employed, he pays an additional tax (which an employer would otherwise cover).  And of course by staying underground, he avoids paying any income tax on his business revenue.

All of this can easily add up to thousands of dollars.  That sum may be inconsequential to a corporation with annual sales in the millions of dollars, but to a small independent, going legit would cost me about 20% of my entire net revenue, more than two months income.

The solution to this is not to finance small business to help them pay for theses fees - these fees are annual, and taking loans only increases risk.  The solution is to have license fees proportional to net revenue, instead of being fixed amounts, requiring insurance companies to offer a full range of coverage options, including (potentially less profitable) low limit policies, and restructuring tax code so there isn't a penalty to being self-employed. Similarly, laws making it difficult or illegal to run certain types of business from home could be relaxed, (for example, allowing small scale retail in otherwise residential districts), eliminating the need for a dedicated store-front, a major on-going expense.

Reducing the government imposed costs of running an independent business legally would, without the additional risk incurred (for both the investor and the entrepreneur) by accepting loans or the costs incurred by providing grants.  It would also increase tax revenue, by encouraging existing underground businesses to come above the radar and join the mainstream economy.

Global Warming Revisited

• Apr 26, 2010

Global Warming Revisited

(The following was a "letter to the editor" I submitted to a progressive magazine in response to articles on global warming)

In "American Psychosis" you point to the many people who acknowledge global warming, but do not change much, if anything about their destructive lifestyles, and in "Hot Air" talk about the point of view of skeptics and deniers.

I run a certified green hauling business. I modified my delivery truck to get 30mpg (from 15mpg) and run it on 100% biodiesel made from recycled veggie oil.  I also work part time supporting people who bicycle to work  (at a business which runs at a loss because our main service is free).  I live in a 250square foot home and use less than $5 worth of electricity most months.
I also have some background in science, including degrees in earth science and biology, and generally track down sources for claims I read.

Having read arguments on both sides, I am not convinced that humans are significantly contributing to climate change.  While I admit I haven't kept up with the latest research, I have yet to see several points addressed:



1 The climate naturally goes through cycles of extremes.  The current climate reflects roughly where it is expected to be.  Our methods of determining past temperatures are not precise enough to tell us the rate of change over small periods of time in the past, and so it is difficult to determine if what we see today is abnormal.
2 Geologic data suggests that in past periods of climate change, temperature has always changed first, with CO2 levels changing as a result of temperature change, not the other way around.  This does not necessarily indicate it is what is happening this time, but it could account for what we are seeing.
3 Climate predictions are only as good as the models they are built on, which in turn are only as good as the computers that run them.  We simply do not have computers powerful enough to accurately model something as complex as the earth's climate.  Last I heard, in order to reduce complexity to a manageable level, most models omit details such as water vapor (arguably the single most important variable) all together.
4 Human caused climate change is frequently referred to (particularly in liberal media sources) as having "scientific consensus".  According to Pew Research center 86% of scientists concur.  While 86% is clearly an overwhelming majority in a democracy, in science 14% is too large a minority to simply ignore.

But here's the thing:
It doesn't make one bit of difference if humans are contributing to global warming or not.
Whether we are causing it or not, its happening (that doesn't take predictions, just measurements - its happening)
Therefor we should prepare for it.
Even more important: independent of global warming, our lifestyles are harming the ecology of our planet. Even if an individual feels no moral reason to care about life other than humanity, it is undeniable that we are totally dependent on the environment for our own survival.

Regardless of climate change, our driving and electricity generation cause air pollution, which in turn causes cancer, asthma, acid rain and many other air quality issues.  Drilling for oil and mining for coal (or uranium) causes massive destruction - when things are running as they should - never mind the occasional catastrophic accident.  Vehicle manufacture itself takes an enormous amount of raw material (as well as energy) all of which must be mined/refined/transported and which carries an ecological price tag. Auto accidents are the number one killer of all Americans below 40 and remains one of the top causes of death and injury at all ages.  Their is evidence that the lack of exercise associated with driving is the number one factor in the obesity epidemic.  The fact that we consume far more energy than we can produce domestically puts us at risk, both politically, economically, and militarily.

All of these problems would remain if we switched to electric (or fuel cell) cars.  Most would remain even if we discovered cold-fusion or some other unlimited supply of cheap energy. 
And of-course all would also remain if humanity decided to combat global warming with a grand geo-engineering project.

The exclusive focus on "human-caused climate change" makes it easy for people to write off environmentalism, because the science is not, in fact, conclusive (as of yet).  It also encourages the idea of using technology to "solve" the issue, with potentially unintended consequences.  And it completely ignores all of the other real, urgent, indisputable problems that our lifestyle has created.

Whether it turns out humans are accelerating climate change or not, our course of action needs to be the same:
One way or another, the earth will eventually get warmer, and people need to be ready to adapt.
One way or another, the American lifestyle is destructive and unsustainable, and we need desperately to downsize our extravagances: give up the car, stop flying, eat vegetarian / organic / local, cut electricity use, buy less stuff, shop locally (when buying is necessary), waste less water, and live in locales that are naturally hospitable to humans (i.e. not the desert)

We can either focus on gradually changing those things now, voluntarily, or we can ignore them and have them changed for us in the future, in which case the change will be very unpleasant, and likely include violence.
Addressing climate change does little to address any of those issues, and where it does it is only incidental.
While I understand the good intention behind keeping environmental issues on the forefront of everyone's minds, I believe that the single-minded focus on global warming is actually counter-productive - even if it does turn out to be true.

I have been appointed polling place inspector

• Apr 23, 2010

I have been appointed polling place inspector

OMG
I am going to be the person in charge of my local polling place.
Democracy will literally be in my hands.

It will be my responsibility to ensure every vote in my neighborhood gets counted.

I am proud, and slightly terrified.

How it is I skipped over getting experience as a clerk first, I am not entirely sure, but I just got a very official looking notice in the mail, informing me that I'm gonna be the guy in charge this primary election, June 8th.

I start at 6am, work until 9pm, and I will have a crew of 5 people.

My designated polling place happens to be the same as where I normally go to vote, and its easy walking distance from my house.

Flat Tax

• Mar 13, 2010

Flat Tax

The science essay I told everyone I was working on has been written, and is in the final editing stages.  It will still be a while before it is ready for prime time though.

In the meantime, here is a short thing I wrote a while ago to someone (don't even remember who anymore) about the concept of a flat tax:

----------------------------------------------------------

The standard arguments for a flat tax make a couple of giant - and totally false - assumptions:

1)That the money which the rich spend and invest creates economic activity, growth, and jobs

2)That the rich have earned and therefore are entitled to their money.

3)That taxing the working class would generate more total tax money because there are so many more of them to tax

1)The investments of the rich do not generate economic activity. If they were not hoarding it, that same money would still be around. Business could get capital from government and bank loans, and from the stock market. That is, in fact, the whole point of the stock market, that capital is obtained from many small sources instead of one giant one.
Its as if one person hoards all the hammers in town, and rents them out to people, then wants credit for the houses other people built with them. If they weren't hoarding the hammers, the hammers would still exist. If they were distributed equitably, no one would need to rent them, therefore building would be cheaper, therefore more would get built. In this way the fact that someone is hoarding and charging interest actually depresses economic activity, because those hoarding the cash skim a little off the top of every financial transaction thereby increasing its cost.

2)The super rich do not earn, and therefore are in no way "entitled" to or "deserve" the money they have. Extremely few of the top 0.1% of wealth holders got there from some brilliant invention, and even fewer of the top 0.01%, 0.001%, and so on. Those at the very top get their wealth primarily from inheritance, and then build on it by collecting dividends and capital gains. They do not actually go to a job and do useful productive work.
Those who do make a salary are not necessarily earning their money either. CEOs make multimillion dollar salaries plus bonuses even when they run their companies into the ground, as we saw just recently, with even companies that needed to be bailed out with tax dollars giving their CEOs multimillion dollar bonuses.

3)The bottom 40% averages about 20k a year. Total annual income is 2.4 trillion.
The top 0.1% averages 7 million a year. Total annual income is 2.1 trillion.
300k rich people have nearly the same total income between them as 120million working class people.

The top 1% averages over 1million a year. Total annual income is 3.3 trillion, far more than the sum of every working class person in the country.

You could tax the working class at a rate of 69% of income and still not bring in as much tax money as you would by taxing the rich at a rate of 50%.
You can't squeeze blood from a turnip.

Furthermore, if you did that, the rich are left with, on average, half a million a year.
Half a million which, remember, they didn't really earn.
The poor are left with $6200.

In order to make a flat tax even approach "fair", you would have to make several other large changes to level the playing field.

First off, you have to eliminate ALL inheritance.  That means 100% inheritance tax on everyone, from ultra wealthy to middle class.  You earn your money in your lifetime, and then it gets recycled back into society.  There is no justification to say that a person is entitled to money they did nothing to earn. 

Second, you have to make education both free and mandatory from pre-school to at least bachelor's degree, if not more.

Third, you have to distinguish between income that comes from doing productive work (wages) from un-earned income such as dividends, interest, and capital gains.  Someone who merely skims off the top of other peoples work should be taxed at a higher rate then someone who actually earns their pay by working for a living and positively contributing to society.

When libertarians and the wealthy begin to fight to level the playing field, then and only then can they claim that a flat tax is about "fairness"

A flat tax is both impractical and immoral.

A couple more Last Day of Youth Party videos

• Jan 24, 2010

A couple more Last Day of Youth Party videos

Now people who couldn't make it can vicariously experience 4 separate components of the party.

Full Contact Spoons - the only existing recording of the greatest full contact sport in the world.  There is only 1 min and 17 sec worth because we are all old and fat and lazy.






Super Smash Bros - I am playing 3 on one (everyone against me) on one TV while simultaneously coaching the people playing Mario Kart on a different TV.
There is also a handicap against me.
And I won.
Repeatedly.
:)



Dancing - 4 hours worth.  I only wore the shoes for a couple songs



Cake at midnight - my comment at the end refers to the fact that 3 different people made/brought cakes, and they all independently put my signature smiley face on them

Micheal Scott has it right

• Jan 24, 2010

Micheal Scott has it right

On the popular TV show "The Office", the branch manager is a bit of a doofus.  He's not all that bright, he is totally obsessed with having his employees like him on a personal level, and he has very little knowledge of actual business or management theory.
He makes his superiors wring their hands and shake their heads - but the thing is, his office's sales record is the best in the company, so despite his many, many faux pax, he always keeps his job.

Nobody can quite figure out how he manages to do such a good job in spite of himself.

Even though he tells them quite clearly, time and again.

He considers his employees family.
He wants his customers to feel cared for.
He is more interested in making people happy than in making money.

You can't learn to be community based and to value clients as actual people in business school.  You can't use the idea of caring about people and being friendly to increase the bottom line, because if your interest is in the bottom line, you aren't genuinely interested in people.  You can't fake authenticity. 



Its either about the love, or its about money. Once you start thinking about rate of return ratios, receivables balance fractions, risk-adjusted profitability, or marginal value-added pricing structures, and all the other things one learns in business school, you are far beyond the point of seeing every person you work for and every person you work with as numbers.

From there it is a very slippery slope to the scenario described by "Jack" in Fight Club: If the cost of the average rate of settlement times the expected rate of failure is less than the cost of a recall for a known deadly manufacturing error, we don't do the recall.
In the end it comes down to morality.  Its either being moral, or maximizing profit.  They are mutually exclusive.

No business is going to have as their slogan "All we care about is your money", and a lot of them try in ads to sound like it isn't true; for any public corporation it is actually illegal for them to consider anything else above the bottom line - if they tried the shareholders could sue. 
For the vast majority of companies jumping on the band wagon, being environmentally responsible is a marketing gimmick as much as a catchy jingle.

Thinking in terms of doing productive work for society while earning fair compensation, as opposed to thinking of how to maximize revenue while minimizing costs will not (always) lead to the highest possible profits.

It will, I think, mean that business actually increases while the rest of the country is in an economic downturn.  It means getting so many referrals its necessary to turn jobs down after going a year and a half without any form of advertising.  It means when, inevitably, mistakes are made, no customer ever makes a claim, because they realize they are not just numbers, that every attempt to be careful was made, all actions in good faith. 
It means that quite a few of my customers make me meals while I'm working.

If a job is a paycheck, it will show through to the customer, no matter how you try to hide it.
If I am ever in a position to hire anyone, my first question will not be about education or experience or abilities or references.  My first and most important question is just this: Why do you want the job?  If its about pay and benefits, no matter how qualified, its "next please".

It has to be about the love.

Best. Party. Ever.

Jan 12, 2010


Best. Party. Ever.



One of the things that happens when you get too old, you spend more time re-telling old stories than generating new ones.

I have a couple new ones now.



Everything went exactly as I had envisioned it, which I find remarkable considering how little planning and prep went into it. Every portion was filled with participants, and all of you get the credit for that. All in all, not counting guests of guests, and the people who had to attend because it was in their house, about 35 people showed up, which is more people than I would have guessed I even know.

I want to extend a most enthusiastic thanks to everyone who came - however briefly - to my party, helping to make it an unmitigated success.

Most especially I wish to thank Greg for offering his house for the party, and Andy, Peter, Robin, Bret, Vern, and Vern's wife (who's name I don't remember since I met her then for the first time) for tolerating it.

Extra thanks to Peter and Jesse who helped me set up at the mansion and clean up again after, and Laura who helped me clear the field of poop, and to whoever found the 2nd N64.

Much thanks to Beth and Jessica who made 2 desserts each and my mom and Lois who brought one with candles - and all of them with my signature smiley face, "Banana Nose", my trademark since Jr. High.

A special thanks too, to Larry who came early and stayed 'till the end, and Sasha and Irina and Lois and Dajenya and Jesse who participated in each separate stage.

Thanks to Larry for the extensive documentation:

(I broke out the stilettos for the first time since prom for a few songs)



http://www.youtube.com/watch?v=fmbhs76CnAo

(The very end)



http://www.youtube.com/watch?v=1kW34_om36g




I try not to be too narcissistic, but honestly, I'd have to say last Saturday was the most fun party I've ever been to. Maybe I shouldn't wait 30 years to have the next one afterall...

(In the meantime, I will have other amtgard/spoons games. Let me know if you'd like to be on the notification list for future games.)

And now on to other things, being mature and responsible and productive and all that sort of thing.