Monday, June 29, 2015

"Entrepreneurs in Non-Profits"

                   Sydney M. Williams

Thought of the Day
“Entrepreneurs in Non-Profits”
June 29, 2015

Margaret Thatcher once said: “The problem with Socialism is that eventually you run out of other people’s money.” We may not be a Socialist country, but we are an aging welfare state. And we are running out of money. We are not yet France, but Social Security and healthcare spending consume an ever-increasing portion of our tax dollars. Economic growth is necessary for ever-expanding government budgets. Yet government regulation and tax complexity have a deleterious effect on small businesses, the main source of hiring and economic growth. The consequence is reduced revenue, increased borrowing and more pressure on discretionary parts of the budget.

In a column last week,  economist Robert Samuelson noted that while federal spending, as a percent of GDP, is roughly the same as it was twenty-five years ago (21%), its composition has changed.  In 1990, Social Security and healthcare consumed about one third of the federal budget. Today they comprise more than half. When other welfare payments are included, less than a third is available for defense, education and road construction. At the state level, thousands of non-profits are seeing budgets squeezed, as welfare-benefit spending consumes a larger share.

Like many, I live amid contrasts. The lower Connecticut River’s tidelands, along whose marshes I reside, have been designated as one of the 40 last Great Places in the Western Hemisphere by the Nature Conservancy. On the other hand, a study released in April by AreaDevelopment, a marketing research group, found that Southeastern Connecticut’s Norwich-New London’s economy ranked 364th out of 379 regions in the United States. Despite the education of its people, and the fact that its wealth has been derived from finance and industry, Connecticut has become anti-business. The state is poorly managed; it has more debt per household than any other. Its taxes are high and so is its unemployment. GDP growth has lagged the nation. The median age is two years older than the U.S. There is little incentive for the wealthy to remain. The needy must.

Three years ago, a group of us formed a 501(c)(3) organization, the purpose of which is to provide assistance to those in need, create a more vital and engaged community and add “sparkle” to the region. (Since I am the least active member of this group, I feel free to tout what the others have done and are doing.) Our group is called Mentoring Corps for Community Development (MCCD). Our website is: We help bring “real life” experiences to local school STEM programs. We help individuals who have suffered, because of natural disasters or events beyond their control. We work with small businesses and start-ups. And we offer assistance to a variety of not-for-profit organizations.

Our purpose is not to raise money for the latter, but to help them become more efficient and to suggest ways in which they may be able to better help themselves. Most of these groups have been largely state-funded. Over the years, relatively easy access to state funds coincided with a proliferation of non-profits. While they helped thousands of individuals, that easy access to money also bred a culture of dependency on state funding. But fiscal mismanagement in Hartford and a slow economy have caused state budgets to tighten. Consequently, many non-profits have had to cut expenses and find alternative funding sources. Humanitarian needs, of course, persist.

Last week I attended the annual meeting of a group with whom we have worked. It is a multi-million dollar organization, in terms of its annual budget. It helps provide housing and job opportunities for disabled persons. Like so many, funding has become difficult. Unlike others, however, the woman who runs this organization confronted the situation pro-actively. She explained to those of us gathered that, apart from the state, her options for resources are three. She can put greater emphasis on the annual fund. She can have special events, such as golf outings. And she can start for-profit centers within her not-for-profit organization.

She will increase participation in annual funding, but that is highly competitive. There are 1.5 million charitable organizations in the United States, with several hundred in Southeastern Connecticut. She will do one or two special events, but there are, as she noted, at least two or three every week in the area. Thus starting small businesses that will at least pay for themselves, while employing some of those she is helping, presents the best opportunity.  She has already begun one or two, like farm stands and a bakery. More ideas will be forthcoming. In doing so, she provides a service and/or product to the community. She reduces, but does not eliminate, the organization’s dependency on the state. Most important, in getting them paid, she is giving her charges a sense of accomplishment and responsibility. She has raised their self-esteem.

At the annual meeting, my associate and I were blown away with the pride of those who had helped bake and package the chocolate-chip cookies we were served – cookies that are now being sold to the area’s casinos and other outlets. The help of a businessman in the region who had experience with packaging and distribution was enlisted. While the bakery is not yet profitable, it will be soon. It runs more efficiently and is raising the profile of the organization.

We will never eliminate all government welfare programs. There will always be the sick and the needy. The numbers of aged are rising. But we cannot afford to ignore their costs – not only the financial, but social costs in terms of dependency. Striking the right balance is critical, else our fate, at some not-too-distant date, will be as Greece’s. What is happening there is a cautionary tale for the world. It tells of the consequences of promises made without regard to their fulfillment – of living for the moment, with no regard for the morrow. In the meantime, the world remains dangerous, as we saw in last week’s three terrorist attacks on three continents, which killed 67 people in a single day. If we and the West cannot assure our citizens’ safety against terrorists like ISIS, there will be little we can do to help our areas’ neediest. We cannot allow government-funded welfare to consume the entire budget.

We need to encourage people to help themselves, as this enterprising and dedicated woman has done in this depressed section of Connecticut. She and her team serve as a model as to how organizations can survive deteriorating state budgets. She is enthused; she has relied on the creativity and hard work associated with entrepreneurship; she understands the pride that comes from work, no matter what kind and no matter one’s disability. She has heeded, on a local basis, the request of John F. Kennedy when he said “…ask not what the Country can do for you, but what you can do for your country.” She is doing in New London County what can be replicated throughout Connecticut and the United States. She is helping people help themselves.

Wednesday, June 24, 2015

"Tragedy in Charleston"

                      Sydney M. Williams

Thought of the Day
“Tragedy in Charleston
June 24, 2015

Whenever and wherever tragedy strikes, politicians follow. This one has been no different. Before the smoke cleared, the Reverend Al Sharpton announced he was on his way to Charleston. The President couldn’t help himself: When asked about the tragedy he expressed consoling words for the victims and their families, but then added that what Charleston, Newtown and Aurora had in common was the ease with which the perpetrators acquired their weapons. The Press, predictably, began barraging Republican candidates on their views regarding gun control, racism and whether the Confederate flag should fly over state-owned property in South Carolina’s capital.

But something remarkable happened. Instead of crying victim-hood, family members of those killed offered forgiveness to the crazed young man who had pulled the trigger – a Christian act of which I would be incapable. Love and forgiveness are foreign to those like Al Sharpton and DeRay McKesson who capitalize on tragedy to promote hatred and divisiveness, as they did in Ferguson, New York City and Baltimore. Al Sharpton, after announcing he was heading south, never arrived. Victims not playing victim is a concept alien to his warped, political mind.

What happened in Charleston was heinous. A deranged young man who fed on white supremacist websites deliberately shot and killed nine members of the historic Emanuel African Methodist Episcopal Church, including its pastor Clementa C. Pinckney who was also a State Senator. Dylann Roof had gone to the church intent on killing. The Reverend Pinckney and the unsuspecting victims were gathered at a table. With Christian charity, they invited this unknown-to-them white man to join their gathering. They spent an hour together. As the meeting broke up, he took out his .45 caliber pistol, recently bought with money his father had given him a few months earlier for his 21st birthday, and shot nine African-Americans in cold blood. He left one witness to tell the tale, and fled.

There is no question that Roof is a racist, but there is also no question that he is a lunatic. His murdering of nine innocent people makes him deserving of the toughest punishment the law allows. But the inexplicable action of a mad man does not mean that America is a racist nation. We are a large, polyglot country and we come in all sizes, shapes and colors. Within our borders, there remain a few who are racist. But racism as an accepted norm – segregated schools and the military, restaurants and busses that refuse to serve African-Americans – is now part of our history, not part of our present. There will always be some for whom racial hatred is part of their makeup, just as there are sexists, chauvinists, anti-Semites and xenophobes. We will never be rid of all bigots. But they are a shrinking presence.

The actions of a few nuts should not be an indictment of society. Politicians love to divide us, as it is easier to make promises to specific segments. Separating us into victims and perpetrators, breeds resentment, making unity less likely. Such division draws attention to our outward differences, which may be race, gender, sexual orientation or age, rather than our commonalities, which is that we are all Americans, protected equally under the law. Theirs is the adoption of the military tactic: divide so as to conquer.

To dwell on racism is to detract from the principal cause of Roof’s murderous rampage – mental illness. We have allowed fear of offending draw us away from a focus on the fact that the man was deranged. Mr. Obama was correct that in the cases he cited perpetrators found it easy to acquire a weapon. But what they also had in common was that they were all nuts. They were bonkers, fruitcakes, however one wants to term them. If their families would not call them out, their schools should have. Society should not have to wait for a mass shooting to discover the mental conditions of people in our neighborhoods. There should be no need to wait for the exact diagnostic term before these nutcases are singled out. Roof’s family members, classmates, teachers and acquaintances had to know he was weird, cuckoo, or “nucking futs,” as one non-p.c. logophile put it. We should be unafraid to use words that are expressive, with meanings easily understood. The first mistake, in the case of Dylann Roof was that no one called him out for what he truly was – a mentally deranged weirdo who had no right to own or possess a gun.

As for guns, I am not a fan. Other than once shooting clay pigeons when I was sixteen, the only time I fired a weapon was in the Army. And I was discharged forty-seven years ago! I don’t like guns. They make too much noise and they can cause too much damage. However, having said that, guns are legal to own and the right to do so is embedded in our Bill of Rights. Guns should be registered and buyers should go through a screening process that ferrets out whackos, drug-abusers and criminals. But most gun owners I know are respectable, responsible and law-abiding. Most register their weapons. Most want other owners to do the same. Most keep them locked up. Most are sane. While it is obvious and perhaps trite to repeat, guns are only an instrument. They can only do harm if a person pulls the trigger. It is the handler that makes them dangerous.

Since this incident happened in South Carolina, the Press was quick to note that the Confederate flag was flying over state grounds. As she should have, given the circumstances, Governor Nikki Haley asked that it be removed. The Confederacy was composed of slave-holding states, and slavery is the blackest of the black marks our nation must bear. But the Confederacy, as the name implies, stood for more than just slavery. It was essentially about state-rights, a legitimate subject for discussion in a republic – an issue we continue to debate to this day. Our country was, after all, a confederacy before it became unified in 1788 as the United States.

The shootings in Charleston were tragic, but if from that horror emerge love, forgiveness and faith, we will be better off. While a crazed gunman was killing fellow citizens in a Charleston church because they were African-Americans, sane but cold-blooded Islamic terrorists were killing Christians and Jews in the Middle East because of their religion. It was the spontaneous reactions of forgiveness from the families of those killed in Charleston that made this tragedy singular. Like Jesus, they asked God to forgive Dylann Roof for what he had done. It was that Christian spirit, manifested in a Charleston courthouse, that so frightens fear-mongers like Islamic terrorists. Love for mankind is a force impossible to overcome. It is a force to celebrate. It was those words, obviously spoken in anguish, that made what happened in Charleston so remarkable. That sentiment may get lost in the miasma that is politics, which will be unfortunate.

Monday, June 22, 2015

"Climate, Poverty, Economics, Values & the Pope"

                    Sydney M. Williams

Thought of the Day
“Climate, Poverty, Economics, Values & the Pope”
June 22, 2015

With his encyclical, “Laudato Si” (Be Praised), the Pope stepped into the quagmire that is climate change. While it is a theological treatise, he joined his infallible voice with those who regard man as the principal cause of climate change. He placed blame on the “developed” world, by which he means the English-speaking nations, Western Europe and Japan. He wrote: “The exploitation of the planet has already exceeded acceptable limits and we have still not solved the problem of poverty.” There was no mention that capitalism and democracy have done more to reduce poverty than anything else, including religion.

There are too many poor in the world. On that we agree. Yet, in our concern for those still suffering, we forget that industrialization has been the reason that starvation and famine no longer embrace the majority of the world’s population. We have become unmindful of the past. Before the Industrial Revolution only a tiny portion of the population enjoyed even the simplest things, which today we take for granted – clean water, proper sewage, medicine, decent shoes and clothes, a healthy diet and reasonable shelter. Economic growth, if it could have been measured, was glacial in the first sixteen centuries of Christianity. Royalty in Egypt 4000 years ago lived as well as their counter-parts in England 3500 years later. Industrialization changed all that. Today, in the world’s most economically successful nations, the average citizen lives better than the greatest king of 300 years ago. None of that had to do with religion. It was the result of creative imaginations and governments that honored private property, functioned under the rule of law, and which allowed individuals to prosper.

In the post-World War II years, economic growth in Europe and Japan was due to massive reconstruction efforts by the United States. During that period, the world’s economies went through a tectonic transformation, led by technology and science. Since the fall of the Soviet Union and the rise of globalization, Eastern Europe, China and other developing nations have seen standards of living improve and poverty reduced. As we become wealthier, our environmental standards change for the better. “Last year,” wrote Holman Jenkins in Saturday’s Wall Street Journal, “the 20 biggest economies produced 3.3% growth with zero increase in emissions over 2013.” Poverty still exists, but growth helps. Economic wellbeing means more energy consumed. But coal-burning furnaces are less pollutant than those of four or five decades ago. Gas and oil are “cleaner” than they have ever been. Competition forces innovation. Big oil companies today account for the majority of spending on renewables. It is in their self interest.

The Pope was right to remind us of our responsibility to the planet and its resources. It feeds and houses us. It warms and cools our environment. But there was no reminder in the Pope’s encyclical that our rivers and harbors are cleaner than they were a hundred years ago; or that the air in our big cities is no longer filled with soot from coal-fired furnaces. The encyclical was a condemnation of our consumption – consumption of products, many of which are produced in emerging countries where they provide jobs and reduce poverty.

It is natural, as we become richer, to live more environmentally-friendly lives. But we cannot let arrogance interfere with clean energy’s costs. The solar industry is a good example. Taxpayers subsidize the industry. Those who can afford solar panels get cheaper electricity at the expense of those who live with little sunlight or who cannot afford panels, as rates rise for electricity produced by power plants. It is a regressive tax that suits the Left, because costs are hidden. Cheap sources of energy are critical for impoverished nations. Why should we, who have become wealthy, deny them the opportunity we had?

A bigger problem, not addressed in this encyclical, is that too many governments under which most of the poor live are anti-capitalist and anti-democratic, with leaders who deny their people the freedom to innovate and accumulate capital. Laws in these countries do not protect private property. The Pope came from such a country. A hundred years ago, according to the February 14, 2014 issue of The Economist, Argentina was among the ten richest nations in the world. Its per capita income was 92% of the average of the 16 richest nations. It was four times richer than its neighbor Brazil. In the 43 years leading up to 1914, Argentina’s GDP had grown annually at 6%, a rate of growth greater than any other nation.

Like all of us, the Pope is conditioned by his past. But it appears he did not learn the economic lessons of dictatorship and Socialism. Today, according to the World Bank, Argentina ranks 55, between Gabon and Antigua. Its per capita GDP is less than one third that of the 16 richest nations. Why? The country fell under military dictators and then under Socialists and redistributionists, including the current President Christina Fernández de Kirchner. There became no room for entrepreneurs. Laws did not protect private property. Individuals lost freedom. Its education system failed. It didn’t have to be this way. The country has great natural resources and a temperate climate. Intrusive government impoverished it.  

I would have preferred an encyclical that addressed the moral decay that has infected Western society. The Pope did touch on some related matters, but it was not his emphasis. Political correctness prevents us addressing concerns squarely and early, like the mental health problems of those like James Eagan Holmes, Adam Lanza and Dylann Roof. We refuse to call those like Ward Churchill, Brian Williams, Elizabeth Warren and Rachel Dolezal the liars they are, and we laud deviants like Caitlyn Jenner. Walter Williams, an economist at George Mason University, recently wrote: “A civilized society’s first line of defense is not the law, police, courts, but customs, traditions, rules of etiquette and moral values.” The developed world has grown rich in material things, but has become impoverished in terms of morality and values. Respect, honor and trust have gone missing. We stand on an ethical precipice. We are in need of someone with the stature of the Pope who has the courage to lead us back from the edge.

In the meantime, there is much in the world that needs improvement, including the ridding of greenhouse gasses. But we must be careful lest we, in our haste, toss out the goose, which is democratic capitalism that has laid the eggs, which are the wealth that has allowed billions of people to rise out of poverty. Wealth alone won’t save the world, but better economic growth will help both the planet and the poor.

Thursday, June 18, 2015

"The Trade Bill & Governing"

                     Sydney M. Williams

Thought of the Day
“The Trade Bill & Governing”
June 18, 2015

Perfection is not found in economics and governing. Reality interferes. The Trans-Pacific Partnership (TPP) is a case in point. The President and Congress may still find a way to pass this important piece of legislation (they have until July 30), but on Friday they failed – a set-back for President Obama. The House did, narrowly, pass the Trade Promotion Authority (TPA), commonly known as “fast-track” trade authorization, 219-211, but failed to pass a related and linked bill, Trade Adjustment Assistance (TAA) that would have extended a decades-old training and income-support program for workers dislocated because of trade. Because the two bills were linked, both were aborted. TPA must precede passage of TPP. Other nations will not provide concessions, if they believe Congress can re-write the Treaty.

The failure of TAA, historically a union-supported bill, reflects how far left the Democratic Party has moved. Private sector unions, which have been in decline for sixty years and which have seen an increase in right-to-work states, are fighting a rear-guard action. In doing so, they have turned inward. Union leaders see TAA as inadequate. Global trade, from their perspective, is an accelerant poured on declining membership rolls. Union leaders pressured Democrats whose campaigns they had financed to vote against the bill.

The importance of TPP should not be underestimated. In increasing trade, it would help the economy. It would lower tariffs, set rules for settling trading disputes and patents. It would protect intellectual property. The Partnership involves twelve countries that ring the Pacific Ocean. It includes Canada, the U.S., Mexico Chile and Peru in the Western Hemisphere, Australia and New Zealand in the South Pacific; and, in Asia, Japan, Brunei Darussalam, Malaysia, Singapore and Vietnam. (In time, the Partnership could and should expand to include other countries, like China, the Philippines, Indonesia, Colombia, Ecuador and Central America.) The founding dozen countries account for 40% of global GDP, and the United States would play the pivotal role. Were the U.S. to drop out, China would step in. Holding TPP hostage to union demands risks losing this opportunity. The best medicine for current economic blahs is economic growth. TPP would give it a boost.

Barack Obama’s problem reflects his personality. While he has kowtowed to labor – among the most frequent White House visitors have been SEIU president Mary Kay Henry, along with her predecessor Andy Stern, and Richard Trumka, president of the AFL-CIO – his supercilious treatment of people prevents him from getting close, including Mr. Trumka whose backing was integral to the passage of TAA. Apart from showing up for a few photo-ops at the 54th annual Congressional softball game on Thursday evening at Nationals Park, Mr. Obama did not make a personal visit to Congress regarding this vote until the day it was held. Nancy Pelosi stands accused of abandoning her President, which she did, but the fault lies with Mr. Obama who has always distained the personal-relations aspect to governing.

Global trade, despite labor’s claims, is not a zero-sum game. In the long-term, trade lifts living standards for all people. It is a real-life manifestation of David Ricardo’s principle of “comparative advantage.” Production is done where it is most efficient and expedient, lowering costs for consumers everywhere. Unfortunately, in the short term Joseph Schumpeter’s precept of “creative destruction” also applies, as trade dislocates some domestic workers during the transition. But life does not stand still. Change, like death and taxes, is a constant. Good leaders keep their eye on the long term, while trying to limit short-term damage. TPP would provide long-term benefits, while TAA was designed to address the short-term concerns of affected workers. By voting no, Mrs. Pelosi sacrificed the long-term welfare of all of her constituents for the short-term demands of a few union leaders. Following Nancy Pelosi’s lead, Hillary Clinton displayed her inner Bernie Sanders by taking refuge within the folds of Mrs. Pelosi’s skirts. She let politics trump what is in the long-term best interest of America’s poor and middle classes.

In one sense, the failure of TAA is indicative of a constituency that has attention deficit disorder. Individuals don’t take the time to listen to reasoned debate. They rely on Twitter for news. Most TV news programs use sound-bites. An “in-depth” analysis is concluded in five or ten minutes. People read what supports pre-determined opinions. But the failure to pass TAA also suggests politicians are incapable of explaining, in simple terms, complex issues.

While Mr. Obama has been the most liberal and progressive President the country has ever known, he is aloof. He comes across as uninterested in the opinions of others, especially with those who disagree with him. Individuals who don’t need the help of others are often abandoned when they, in turn, seek help. Mr. Obama has made wide use of executive orders and strengthened agencies, like the EPA, that report directly to him. Apart from his first two years, when both Houses in Congress were controlled by Democrats, Mr. Obama has shown little interest in working with the Legislative branch. Congress, to his thinking (or so it seems), is an inconvenient nuisance. The same is true for his views on the Supreme Court, as have been seen in his dismissive comments.

When Mr. Obama finally made his belated trip to Congress last Friday, he arrogantly demanded: “A vote against trade is a vote against me.” Democrats, including Nancy Pelosi, listened politely and then voted against him. So-called progressives – so-called because what they are doing is the opposite of progressive – are circulating petitions asking people to block TPP. Even the easily-forgotten Martin O’Malley is into the act.

None of those who support the trade bill have given up. Republicans have proposed separating TPA and TAA, voting on the latter first. The President will lobby as best he can. The secret to governing is not finding the perfect balance. It is to find compromise, so that, in this case, an in-coming tide will lift all boats, perhaps not in unison, but over time. Giving Mr. Obama fast track authority so that he can complete TPP is a good thing. I recognize the risk associated with his less than stellar history of negotiating in the international arena. Nevertheless, this is a battle I hope he wins. The economy needs it. It is ironic, however, that he now needs those he dismissed a little more than six years ago, for example when he silenced Paul Ryan with the words, “I won.” Elephants have long memories, but that was one insult that is best forgotten…at least for now.

Monday, June 15, 2015

"Inequality in a Socialist World"

                   Sydney M. Williams

Thought of the Day
“Inequality in a Socialist World”
June 15, 2015

The United States is not a Socialist country, but it has been trending toward paternalism for decades. About 35% of the nation’s GDP is a product of federal, state and local spending. Dependency on government has grown. Two-thirds of the federal budget is now dedicated to entitlements. Excessive regulation has hampered small-businesses, and annually costs consumers billions of dollars in hidden fees. Nanny state antics have had little effect on youth obesity, but have made a significant dent in their parent’s wallets.

While purporting to keep people safe from themselves, regulatory rules’ real function enables favored industries and provides job security for federal employees. The complexity of our tax code benefits America’s largest businesses and its richest citizens. One impediment to simplifying the code is the large numbers of people who have a vested interest in keeping it complicated. Our universities inculcate credulous students into a one-sided political philosophy. Overly sensitive students are taught politically-correct courses from syllabi that contain trigger warnings against microaggressions. It’s a narcissistic world, grown narrow.

And yet the Left insists that the negative consequences of what they (and the Right) created – inequality, unfairness and a lack of transparency – are somehow the fault only of the Right! (All positive results – civil and women’s rights – are the exclusive province of the Left.) But have not both Parties been responsible? Consider: Would GE have paid no federal corporate income tax were it not for specially designed loopholes? Would the Clinton Foundation have been able to raise billions of dollars to fund unemployed Democrat campaign workers and pay the Clintons hundreds of million of dollars without the special tax treatment the Foundation received? (What is true for the Clintons has also been true for some Republicans. However, the Lois Lerners of the world want to make political charity exclusive to the Left.) Has it been fair to all parties that the Federal Reserve has kept interest rates at abnormally low levels for an extended time, using the “Great” recession – a recession not as bad as that of the 1970s or early 1980s – as the excuse?  Low rates have benefitted banks, hedge funds, corporate acquirers and government at the expense of the elderly and thrifty. Was it right-wing zealots that pressured the Federal Reserve? Was it fair and equitable that Condoleezza Rice and Ayaan Hirsi Ali were disinvited from speaking at universities? Does blindness to alternative ideas discourage or encourage a university student’s chances for future economic success? 

The Left claims that inequality is “the issue of our time.” Yet, is not elitism that emerges from bureaucrats on the Left every bit as inegalitarian as that which they condemn in so-called one-percenters? Inequality in outcomes is a fact of life. Equality of opportunity, on the other hand, is basic to an enlightened society. If one wants to see true inequality, look to societies such as China, Cuba, Russia and the Islamic world. Totalitarian regimes are not only unequal in outcomes, they are unequal in opportunities. There is no social or economic mobility. As governments assume more power, the gap widens between governors and those governed.

Mr. Obama has been President for six and a half years. For six years his Party held control of the Senate. For two years they held both Houses of Congress. He has claimed to fight for the poor and middle class. Yet income and wealth gaps have widened under his watch. A Gallup poll, released in late April, tells that the number of Americans who identify as middle class has fallen ten percentage points since 2008 – from 61% to 51%. Social mobility in terms of the economic ladder, according to a recent series of articles in The New York Times, has been flat for many years. Obama’s policies have not reversed these trends. That Gallup Poll also said people are less confident of the future than they were when Mr. Obama took office.

One explanation for the wealth gap is that financial success (apart from the cronyism that has enriched so many in public life) is a consequence of virtues now seen as dated and thus under attack: aspiration diligence, hard work, perseverance, thrift and a willingness to take risk. Success also requires intelligence and creativity, traits that are innate, not acquired. Successful people make the most of what they are given. We are stuck with inequality. What we need strive for is mobility and ensuring that opportunity is open to all. That means better education and the encouragement of those virtues that have been shunted aside in today’s sensitive world where admiration for Caitlyn Jenner’s courage supersedes that for uniformed police, the military, and even for those entrepreneurs who dream and are willing to bet big.

Entitlements and dependency did not begin with Mr. Obama. They are part of our culture. As long ago as 1965, in his report of that year, Daniel Patrick Moynihan wrote that the American people had become corrupted in a “tangle of pathologies.” Those included, he wrote, welfare dependency, flight from work and family breakdowns. In the years since, none of those factors have improved; in fact they have worsened. Those “pathologies” enable, not defuse, inequalities.

We are in a difficult place. At home, we have mounting government debt we can ill afford. Public-sector unions risk bankrupting our states. Our health system is broken. We have given in to central bankers who have cheapened money, with consequences yet to be foretold. We are a nation divided for political expediency. Helped by C-Span, identity politics and extremists from both sides, political partisanship has made collegiality in Washington (and now in State Capitals) a relic of the past. Overseas, we have enemies’ intent on destroying our way of life, from Islamic terrorists, Russian aggression, to Chinese hackers. We need a stronger economy and a stronger military. As Louisiana Governor Bobby Jindal said last week: “Weaker economies hurt everyone in them.” Stronger economic growth requires less onerous regulation and a simplified tax system. It means increasing trade and defending trade routes, which means increasing – not decreasing – our military presence, especially naval.

Inequality exists in all societies, especially those run by autocrats. Inequality does not just mean income and wealth; it can be manifested in privilege and personal freedoms. Polls show that social and economic mobility is more important to people than gaps in income and wealth. In Socialist countries, it is the elite who run government and bureaucracies, who live freer and more enriched lives than those they oversee. A fair society is one that has a moral sense, which allows mobility – that rewards aspiration and hard work. That is only possible in a democratic system that operates under the rule of law, defends human rights, protects private property and which practices free market capitalism. It is work, not government that is the answer to inequality.

Thursday, June 11, 2015

"Turkey Rejects Putinization"

                      Sydney M. Williams

Thought of the Day
Turkey Rejects Putinization”
June 11, 2015

Overwhelmingly, voters in Turkey denied President Recep Tayyip Erdoğan’s bid to turn what is largely a ceremonial office into an executive presidency with enhanced powers.  According to the New York Times, voter turnout topped 86%, a high level of participation in any election. Mr. Erdoğan’s Justice and Development Party (AKP) entered the election with 327 seats in the 550-seat Parliament. It emerged with 258 seats.

The other three parties are the secularist Kemalist Republican People’s Party (CHP), inheritors of Mustafa Kemal Atatürk who founded modern Turkey in 1923; the rightwing National Movement Party (MHP) and the People’s Democratic Party (HDP), which includes a pro-Kurdish coalition. It was the performance of the latter, taking 13% of the vote – above the 10% threshold required to gain seats in parliament – which stunned Erdoğan watchers. Mr. Erdoğan had called for an election, expecting to pick up enough seats so he could then call for a referendum on the Turkish Constitution. The intent was to reduce the influence of parliament and enhance the power of the President. He lost, but he cannot be counted out.

On Tuesday, in a procedural move, Mr. Erdoğan accepted the resignation of Prime Minister Ahmet Davutoğlu, but asked him to stay on until a new government is formed. Expectations are that the AKP will try to join forces with the MHP; though the latter’s willingness to be wooed seems in doubt. New members of parliament will be sworn in on June 25th. They will then have 45 days to form a coalition government. Should that fail, Mr. Erdoğan will call another election.

What happens in Turkey is relevant to America. Its location is pivotal. It spans Europe and Asia. The Country comprises a fist sticking west from the Middle East, with the Black Sea to its north, the Aegean to the west and the Mediterranean to its south. Its thumb, pointing north and breached by the Bosporus, extends into Europe, where it abuts Greece, Bulgaria and Georgia. To the east, it borders Armenia, with whom they have a difficult history, and Azerbaijan. Their Middle Eastern neighbors are Iran, Iraq and Syria. Syria’s repressive Assad regime and the emergence of ISIS in Iraq and Syria have dumped about two million refugees into Turkey’s southern border towns – a meaningful cost to the country’s 75 million people.

It was Erdoğan’s increasing authoritarianism and comparisons to Vladimir Putin that galvanized the Kurds and other dissidents. The two men are different: Erdoğan is an active Sunni Islamist, while Putin, a member of the Russian Orthodox Church, is truly a secularist. Two of Putin’s Mid East allies, Syria’s Bashar al-Assad and Egypt’s Abdel Fattah el-Sissi, are seen as enemies by Mr. Erdoğan. In the Ukraine, Erdoğan supports the Crimean Tatars, a Turkic people. The two leaders, however, have reached rapprochement regarding their differences.

These men are cast from the same mold. Both grew up relatively poor and were good high school athletes. Power is their aphrodisiac. Putin has been in office for fifteen years, Erdoğan for eleven. Both are demagogic and authoritarian. Both are anti-women and anti-gay. Both would like to return their countries to their empirical pasts – the Russian and Ottoman Empires respectively. Two years after Putin crushed protestors in Moscow’s Bolotnaya Square, Erdoğan did the same in Istanbul’s Gezi Park. Both men built palaces fit for a Tsar and a Sultan: Putin’s enormous $1 billion palace sits on 175 acres on the Black Sea; Erdoğan’s 1100 room palace in Ankara cost a reputed $615 million. Both thrive on personal control. Neither is interested in reform, human rights or democracy.

Change of this magnitude, however, brings instability. A headline in Wednesday’s Financial Times read: “Turkey impasse Underlines Economic Doubts.” Uncertainty is always a challenge for investors. And Sunday’s vote was destabilizing. On Monday the Turkish stock market fell 8% and the Lira declined 5%. Turkey’s economy was already suffering. GDP in 2014 grew at a lackluster 2.9%, and weakness persisted in this year’s first quarter. Unemployment is 11%, a five-year high, with consumer confidence at a six-year low. Turkey’s central bank had been pressured by Mr. Erdoğan to keep interest rates low. (He had accused the bank of “treason” when they threatened to raise rates.) External investment is likely to be sidelined until investors have a better sense as to what direction the government is headed. There are those in the West who would prefer the stability of an authoritarian Mr. Erdoğan to the absence of a clear mandate.

But, in my opinion, they are wrong. We in the West take democracy for granted. We forget or are ignorant of its human costs. Emma Lazarus, in words enshrined on the Statue of Liberty, wrote of people “yearning to breathe free.” The desire for liberty, justice, human dignity, respect for others and the rule of law are universal. Those desires are innate; they are not limited by culture, race, religion or place. In his 2002 State of the Union address, George Bush spoke of that sense: “All fathers and mothers, in all societies, want their children to be educated and live free from poverty and violence. No people on earth yearn to be oppressed, or aspire to servitude, or eagerly await the midnight knock of the secret police.” In the comfort of our homes and in our assumption that freedom is a given, we have lost our understanding of the price liberty exacts.

In the short term, the quest for freedom, as was indicated in Turkey’s electoral results, will prove unsettling. But we should not let short term economic dislocations derail the move toward democracy, or influence our response. Freedom needs nurturing and that should be a role America plays – in this case, supporting the Kurdish minority, standing with those who were unafraid of a man intent on stomping out their liberty.

Despotism creeps up on little cat feet. No country is immune, including our own. Institutions can inhibit the rise of a despot, but they cannot always stop him. It is only the people that can. Their arsenal is the ballot box. Men like Erdoğan (and Putin) begin with the legitimacy of elections. They appeal to emotions, not intellect. They make promises of what government can provide, not requests for forbearance or sacrifice on the part of the people.

That Turkey repudiated a would-be dictator should be celebrated. But caution is necessary, lest opportunity slips away. A good friend, an American who is Turkish by heritage and who spent his early childhood there and who travels back every year, wrote me two days ago: “I think what the Turkish opposition needs to avoid at all costs is the AKP running a minority government, or an immediate new election. Time is needed to dissipate Erdoğan’s power.” Good advice.

Tuesday, June 9, 2015

"Connecticut's Budget - Sign of Failure"

                                                                                                                       Sydney M. Williams

Thought of the Day
Connecticut’s Budget – Sign of Failure”
June 9, 2015

The truism expressed by Arthur Laffer’s “curve” a little more than forty years ago is as relevant today as it was then. It is obvious that tax rates of zero and 100% yield zero. The “curve” was an attempt to find the optimum rate. Economics are elemental to politics. In general, the Left wants government to assume a bigger role, which requires higher taxes. The Right argues for more limited government and, therefore, less need for revenues. That is the essence behind all political debates and partisan bickering that we see in Washington and State Capitals. Logic tells us there are certain societal functions that can only be handled by government. Common sense tells us that the more government takes, the less there is for consumers and businesses to spend and invest. That, in turn, leads to less economic growth – fewer jobs and lower standards of living. It is a self-perpetuating cycle. The role of Governor or President is to find common ground.

There is a natural propensity for institutions to expand and for individuals to want more, and what is true for for-profits is true for government. Government is supposed to be servant to the people, but that does not detract from its natural inclination to serve itself. Constancy is not natural to bureaucracies. Managers want more power, higher salaries and better benefits. The only governor on its expansion is the electorate. Four factors have accentuated the problem: unionization of government employees, an inclination on the part of both political parties to kick hard decisions down the road, low interest rates, and an increase in those who are dependent on the state.

Some states have handled their finances well. Others have not, nor has the federal government. They are all subject to the irresistible force paradox known to students of physics: What happens when an unstoppable force (promised retirement benefits to government employees) meets an immovable object (a lack of money)? In the instance of Connecticut and other bureaucracies, the unstoppable force is strengthened by guaranteed union contracts. Nevertheless, the immovable object is seen as less threatening because of low borrowing costs, thereby deferring the inevitable. It is like crossing the bar, when the flood tide rises to meet a river’s current. Some of these concerns are reflected in the recent budget proposed by my state of Connecticut. It is a small state, comprising just over one percent of the nation’s population living on about .0015% of the country’s land mass. Yet its story is a morality tale that has yet to be played out.

Connecticut is a rich state. It ranks fourth in terms of household income, fifth in terms of GDP per capita and third in terms of taxes paid per capita. It is eleventh in terms of household net worth. Yet it is essentially broke, with total liabilities, which are comprised mainly of pension and healthcare obligations, exceeding assets by about $62 billion, or $17,000 per person. Connecticut ranks among the top in terms of debt per capita and among the worst (45th according to “CEO Magazine”) in which to do business. The only states to fare more poorly were such infamous anti-business states as California, New York, Illinois, New Jersey and Massachusetts. Connecticut has the dubious distinction of being bundled with seven states that collectively have lost 42 headquarters of Fortune 500 companies, along with 645,000 jobs since 1995. Between 1990 and 2010, Connecticut lost 138,400 manufacturing jobs. Only five states lost a larger percentage.

High taxes and a poor business climate are chasing people out of the State. About 25% of retired Connecticut State employees, for example, have moved out of state. Allied Van Lines reported that of moves involving the State, 60% are outbound, while 40% are inbound. Between 2013 and 2014, the U.S. gained two million people; Connecticut lost twenty thousand residents.

The principal culprit for budget woes and personal dissatisfaction can be traced back to rising taxes due to pension and health liabilities, and the negative drag they have had on economic growth. According to a study by New London’s “The Day,” the average state employee retires at age 57.1, with a pension (numbers as of 2012) of $31,666. Given actuarial tables, his (or her) lifetime pension is expected to be $987.243. Yet she (or he) contributed only $20,355. The numbers for retired state teachers are slightly different, but still require massive inflows from taxpayers. The system, according to “The Day,” is the second most underfunded in the United States. The gap, including both pension systems, is $44 billion. Part of the problem is a common one – the assumption of too-high annual returns. Actual returns over the past ten years averaged about 150 basis points below the assumed rates. Taken together, the two pension plans were funded at 49%, when they should have been funded at 80 to 100%, according to experts.

Retirees’ health benefits are in equally bad straits. According to an actuarial report by the consulting firm The Segal Group, the health benefits program was funded at just 0.31% as of 2011. Total unfunded liabilities for the two healthcare plans (state employees and teachers) were just under $20 billion. The unfunded liabilities of both health and retirement plans amount to 189.7% of revenues, second only to that of Illinois, again a disturbing comparison.

Unfortunately Connecticut’s problems do not seem to have alerted legislators; though some in the liberal press have begun to take notice. The two-year budget, recently negotiated and approved in both houses of the state’s legislature, calls for a 4% increase in spending in each of the next two years, double the state’s growth in GDP. Republicans were not invited to participate in the proceedings. Unilateral legislative actions do not make for good legislation. Additionally, the threat of another tax rise caused General Electric’s Jeffrey Immelt to write an open letter to employees. In it he warned, GE may be forced to move to a more business-friendly state.

The problems Connecticut faces are not unique. Greece’s problems have similar parentage – government spending that exceeds revenues and hampers economic growth. The cold, hard truth is that nothing is free. There exists in modern government an unhealthy symbiotic relationship. Union leaders see strength in numbers and demand unrealistic benefits. Legislators acquiesce, as they are dependent on union money for their offices. The goat is the taxpayer.

While Connecticut’s budget calls for another $1.9 billion in additional taxes, the State is talking about increasing its take from gambling – a regressive tax I wrote about a few days ago. The State needs a wake-up call. Something should happen to cause taxpayers to recognize they are being played for a patsy. Maybe Mr. Immelt will take GE out of Connecticut? Perhaps markets will be less friendly to the State’s indebtedness? Maybe band-aids will not staunch the bleeding? Unless conditions are addressed, a day of reckoning is coming. It requires a brave politician to stand up and say, enough!

Friday, June 5, 2015

"Hillary - Inevitable?"

              Sydney M. Williams

Thought of the Day
“Hillary – Inevitable?”
June 5, 2015

The inevitability of Hillary Clinton has been a deliberate strategy by supporters of the former Secretary of State, U.S. Senator and First Lady. The idea: perception becomes reality. It may be working. Noah Gordon, writing in the April 12, 2015 issue of The Atlantic, noted: “Since mid-2013, Clinton’s share of Democratic primary voters has averaged 60 percent.” In the build-up to the 2008 election, those same numbers were 40 percent. A question: will it backfire? For example, the number of people who consider her dishonest has reached new highs. And she has attracted some minor competition.

Running a primary without meaningful competition is a risk for a major political Party in a democratic republic. The concept of “inevitability” is present in hereditary monarchies, not amongst people for whom government is a guarantor of personal liberty and property rights, not the perpetuator of one family or one Party. Our government is based on the rule of law – laws that stem from the inalienable rights of the people – not the rule of men. We do not presume preordination. We should not claim entitlement to ensure nomination or election.

Predetermination carries with it a sense of invincibility. In Mrs. Clinton’s case, that does not mean those who support her feel she is unbeatable, but that she should run a cautious campaign – a “listening” tour and avoid controversial positions. Certainly, she believes the nomination is deserved – in fact, feels she is “owed” it. She concludes she is capable of being President. She was with her husband for eight years (alright, not always with him), and she served President Obama for four years. She is intelligent and experienced.  Besides she is a woman – a feminist she would have us believe. She would be the first of her gender, and being “first” – especially for those on the Left – counts for more than ideas, policies or character. She has been loyal to her Party and to her husband, neither of whom have always been loyal to her. She has name recognition, which is a positive, but her name is also synonymous with dishonesty, cronyism and obfuscation.

Mrs. Clinton has been in the public eye for thirty-six years. She was 31 when her husband was first elected Governor of Arkansas in 1978. With the exception of two years, 1981-1983, she served as First Lady for twenty-two years, first of Arkansas and then of the United States. Once out of the White House, she won election to the U.S. Senate from her adopted state of New York. As a Senator, she served without distinction. As consolation for wresting what she and others felt was rightfully hers, Barack Obama named her Secretary of State. She served four years in that position without any visible successes, other than setting records in miles flown and countries visited. She resigned at the end of 2012, in order to mount a second quest for the White House in 2016. She has had a lot of experience – remember we were told we were getting two-for-one when her husband was elected President – but little in terms of accomplishments – recall her aborted health care plan. Her most visible characteristic is a Teflon-like ability to deflect scandals. As Bret Stephens wrote in Tuesday’s Wall Street Journal about both Clintons, “Nothing embarrasses them, so nobody stops them.”

Mrs. Clinton can be testy regarding the press, which amuses conservatives as the media is unabashedly liberal. She has been mired in questionable enterprises almost from the first: In her husband’s first term she miraculously turned $1,000 into $100,000 with the help of a family friend and lawyer for Tyson Foods. The Clintons lied about their involvement with their former business partners the MacDougals and the Whitewater Development Corporation. The MacDougals were convicted of fraud and went to prison – later to be pardoned by Bill Clinton – while the Clintons went to Washington. When they left the White House in January 2001 (after trashing it), they bought two properties and listed their assets at $1.8 million. As for her claim she left the White House “dead broke,” Mrs. Clinton apologized…in a way: “It was ‘inartful.’ But it was accurate.” Whatever that meant!

Consider: Mrs. Clinton is a “proud” feminist. Yet she called those women who were sexually harassed (and worse) by her prurient husband “nuts and sluts.” It mattered not to the former First Lady that these women had to be demeaned so that her husband’s reputation would be unblemished. For that reason alone, their names – Monica Lewinsky, Gennifer Flowers, Paula Jones and Kathleen Willey – should not disappear from our memories. Ms. Willey later said about Mrs. Clinton’s scurrilous attacks: “She is ‘the war on women,’ as far as I am concerned.”

Hillary Clinton is a mountebank who dons a southern accent, as she patronizingly seeks votes in South Carolina – a state that rebuffed her in 2008. There is arrogance in her staged roundtables – posed with elbow on the table, chin resting on clenched fist and eyes gazing in adoration. She had the chutzpah to use a personal e-mail, with its private server, to conduct the business of the United States as Secretary of State. She was patronizing to the American people when she claimed to have only destroyed those e-mails that were personal. Most damning, in my opinion, she deliberately lied to the families of the fallen, when the remains of the four Americans killed in Benghazi were returned home to Andrews Air Force Base. These are the traits of a charlatan, without a morsel of remorse. She is a woman without character.

The Clintons are not alone in their greed and deceit. Such practices are common to both Parties. Dennis Hastert and Harry Reid made millions by being politicians. But the Clintons’ position, fame and leadership should have made them paragons. Instead they are the worst of the worse. Lies, greed, cronyism and self interest are the examples they set. The practices of the Bill, Hillary and Chelsea Foundation may be legal – there may be no smoking gun – but it is morally corrupt.

The people of the United States deserve better in their choices for President. No prior experience fully prepares one for the Presidency. There is no syllabus. Abraham Lincoln had the least preparation, yet was perhaps our greatest President. The office demands an individual of wisdom, honor and judgment, one who is morally beyond reproach. By necessity, we rely on the inner person. It makes no difference the individual’s sex, religion or color. In deciding whom we nominate, we should first consider character.

There is nothing inevitable about Hillary, other than that the web of lies will eventually entrap her. With luck, she will not be in a position of power or influence when that happens. My belief (perhaps my hope?) is that it happens sooner rather than later.

Monday, June 1, 2015

"The Month That Was - May 2015"

      Sydney M. Williams
                                                                                                                  June 1, 2015
The Month That Was
May 2015

“What potent blood hath modest May.”
                                                                                                                Ralph Waldo Emerson (1803-1882)

May is the month, at least in New England, when blossoms open. Dogwoods, Cherry and Apple trees show their colors. Forsythia and Rhododendrons bloom, as do roses; Peonies begin to open. The days are warm and the nights cool. It is one of the calendar’s most beautiful months. But not for everyone and not every place.

Here at home: At least 29 people, with several still missing, are dead from floods that devastated Texas and Oklahoma. An Amtrak train, traveling over 100 miles per hour (twice the speed limit) derailed outside Philadelphia, killing six and critically injuring five. Several gangs of whacko bikers in Waco, Texas got into a gunfight leaving nine dead, several wounded and a hundred and seventy arrested. Two police officers in Hattiesburg, Mississippi were shot and killed.

And overseas: ISIS, once known as the junior varsity of Islamic terrorism and now infamous for beheading Christians, killed one captive with a bazooka, then danced around what was left of his body. During the month, ISIS took the Iraqi city of Ramadi and the Syrian city of Palmyra, brutally murdering many of those unable to flee. Of significance: they restored some city services in Palmyra, to endear their governing system to the populace. They boasted that they would be able to secure a nuclear weapon within twelve months – perhaps only bluster, but a claim that cannot be taken lightly. Boko Haram, Nigeria’s answer to ISIS, continued its rampage, killing forty-three in the town of Gubio. They now control an area the size of Belgium. In the past few days, Russia has amassed thousands of troops and hundreds of pieces of military weaponry on the Ukrainian border. Presumably they are not there on holiday. China continues to construct man-made islands in the South China Sea. It is doubtful they will be used as vacation spots for China’s plutocrats.

At month’s end, eight Republicans had announced for President. Seven others are in the “probable” category, including two who show up near the top of most polls – Jeb Bush and Scott Walker. On the Democrat side, the field, for all intents, is limited to one – Hillary Clinton. (Martin O’Malley did, however, bravely announce his candidacy as the month ended.) If Republicans look like a monkey madhouse, Democrats appear royal, aged and idea-less. In Salt Lake City, the “quake of the lake” 68 year-old Mitt Romney took on 52 year-old Evander Holyfield in a charity match. After the bout Mr. Romney said he would have boxed anyone, as long as Candy Crowley was not the referee. In Garland, Texas a Prophet Mohammed cartoon contest provoked two Islamic thugs who fortunately were shot and killed before they carried out their planned terrorist attack. While the contest was seen by many on the Left as unnecessarily provocative, the same people saw nothing wrong with exhibiting a painting of the Madonna covered in elephant feces. Assuredly, the decision to choose an elephant as the contributor was deliberate. The dung of a donkey would have been more appropriate.

David Letterman hosted his last late-night TV show. Bob Schieffer’s final broadcast for CBS’s Face the Nation was the last day on the month. In Yonkers, a city of 200,000, a black bear was spotted, trapped and taken upstate. Dennis Hastert, former Republican Speaker of the House, was accused of making payments to conceal sexual misconduct. On the other hand, Lois Lerner continues in retirement, receiving full pay courtesy of the American taxpayer she swindled. Pew Research released a study detailing the decline in church attendance among all faiths with the exception of Evangelicals. While Democrats looked at the findings as being good for their cause, Robert Putnam, Harvard sociologist and liberal, noted: “[The] social benefits of religion are stronger further down the economic ladder.” New York State Comptroller, Thomas DiNapoli, claimed that the $200 million ad campaign “Start up New York” brought in a total of 76 jobs over a period of a year and a half – not the return cost-conscious citizens expect from their elected leaders. A jury in Boston decided Dzhokhar Tsarnaev, the unrepentant Islamic Boston Marathon bomber, should die.

The six leaders of the GCC (Gulf Cooperation Council) were invited by the President to attend a White House meeting to discuss the Iran deal. Four of the leaders, including King Salmon of Saudi Arabia, elected not to attend, sending subordinates in their stead. Wendy Sherman, Mr. Obama’s chief negotiator on the Iran nuclear deal, announced she would be leaving the Administration once the June 30 deadline is reached. But the Mideast news was not all bad. A U.S. Special Forces unit conducted a raid deep into Syria and killed a top ISIS commander, Abu Sayyaf. Nevertheless the premature abandonment of those we have pledged to help militarily, as we did in Vietnam and have done in Iraq and Afghanistan, neither honors our soldiers who fought and died, nor leaves trust or hope among those left behind. Chaos inevitably followed.

Between Northern Ireland and the Isle of Man, an Irish fishing trawler snagged a Russian submarine, surprising sailors on both vessels. In England, David Cameron won a surprisingly strong re-election bid, giving the Conservatives a majority in Parliament for the first time since 1992. In Poland, conservative Andrzej Duda won the presidency, ousting existing president Bronislaw Komorowski. It is telling that, at a time when the Left dominates the media and international bodies like the U.N., conservatives have had surprising success.

The Shanghai Market, which has been on a tear – up 52% year-to-date – had another good month (+3.7%), but this time with hiccups. Over a two-day period in the middle of the month, the market lost 8.5%, and then another 6.7% during the month’s final two days. Such volatility does not normally bring comfort to investors. On May 20, Hong Kong listed Hanergy, a solar power company 80% owned by chairman Li Hejun, lost 47% of its value in less than an hour. Mr. Li’s paper losses, which would have been $14 billion, were tempered by his prudent (but certainly unethical if not illegal) decision to short 796 million shares just days before the stock crashed. Takata, the Japanese auto parts company and world’s largest manufacturer of airbags, was ordered to recall 34 million autos for defective airbags, the largest recall in automotive history.

Back in the U.S., financial markets were tepid, but positive. Most major markets made new highs The S&P 500 rose one percent. The NASDAQ Composite was up 2.6 percent. Treasuries declined slightly, oil was flat, gold down and lumber was up. The Dollar rose. The VIX was flat and composite volume continued to decline. First quarter U.S. GDP was revised from up 0.2% to down 0.7%, setting up a possible repeat of 2014. F.A.O. Schwartz, the legendary toy company that was founded during the middle of the Civil War in 1862 and is now owned by Toys “R” Us, announced it would be closing its flagship store in New York, disappointing millions of children and a few collectors of Steiff teddy bears, including my wife.

My friends that my interest in professional sports is minimal. The only thing exciting about the Floyd Mayweather-Manny Pacquiao fight, which Mayweather won handily, was the size of the purse – $300 million!  American Pharaoh won the Kentucky Derby and the Preakness, the first two legs of the Triple Crown. The Stanley Cup will match the Chicago Blackhawks against the Tampa Bay Lightning. The NBA championship will be between the Cleveland Cavaliers and the Golden State Warriors. Winners of both will be determined in June, by which time ice rinks and sweaty gyms will be far from the minds of most people. Alex Rodriquez leapt to fourth place in home runs and broke Lou Gehrig’s American League record for RBIs. But does anyone care? Little League is struggling to get kids to play a sport whose popularity is in decline. Perhaps it is because baseball is a “thinking man’s” sport, or maybe it is because we live in an ADHD world. But it may also reflect a surge in the popularity – at least in the Northeast – of soccer, tennis and lacrosse. The $150 million scandal surrounding FIFA (Fédération Internationale de Football Association) did not affect the re-election of Sepp Blatter as the organization’s president. As USA Today put it, “cronyism is alive and well.”

On a more sober note, May 8th marked the 70th Anniversary of the end of the war in Europe. In its wake, it left most European capitals in ruins, economies shattered, an estimated 75 million people dead and millions more wounded, homeless and destitute. Was the war worth it? That is an unanswerable question, but we do know that the world is better off because the Allies won. On May 14th, 1948 the State of Israel came into being – still the lone democracy in the Middle East. Many of its neighbors are still intent on its destruction. Thirty years ago, May 5, 1985, Ronald Reagan went to Bergen-Belsen. With a giant photograph of a white, bloated corpse as a background and fighting back tears, President Reagan acknowledged the inadequacy of empathy: “Here lie people – Jews – whose death was inflicted for no reason other than their very existence…”

In other news, Ireland voted to allow same-sex marriages. The Left persisted in its attacks on social values. Kathleen McCartney, president of Smith College and an advocate for universal child care, wrote an op-ed: “Time to rethink our social construct of motherhood.” Her message to mothers: there is no special bond between mother and child – children thrive in quality child care. Really? A German woman, age 65, gave birth to quadruplets, adding to her already large brood of thirteen. Playboy completed a deal in China with a company called Hangdog! And the FDA, in its infinite wisdom, decided that s’mores were unhealthy. They encourage replacing chocolate with strawberries and marshmallows with fat-free yogurt. Will campfires ever be the same?

The great bluesman, B.B. King died at age 99. John Nash, the Princeton mathematician and subject of the film A Beautiful Mind, was killed, along with his wife when they were thrown from a cab on the New Jersey Turnpike. On a sad note, Beau Biden, the 46-year-old son of Vice President Joe Biden, died of a brain tumor. Jim Wright, the former Democrat Speaker of the House who was forced to resign, died at age 92 in his home city of Fort Worth, Texas. Marques Haynes, once of the Harlem Globetrotters and who I saw play in Peterborough, New Hampshire in, I believe, 1952, died at age 99.

With the inevitable march of time, we close the book on May and welcome June and all she will bring.