« August 2013 | Main | October 2013 »


September 30, 2013

Among 1890s Wall Street Elite, "It Was Fashionable to Be Anti-Semitic"




GentlemenBankersBK2013-09-27.jpg













Source of book image: online version of the WSJ review quoted and cited below.






(p. A11) J.P. Morgan may well have been the most powerful banker who ever lived. Certainly he was the most powerful American banker. But the banking world that he and his firm dominated was a short-lived one, lasting only from the 1890s to the Depression of the 1930s. Susie J. Pak explores Morgan's world, especially its social aspects, in "Gentlemen Bankers," and the exploration is very interesting indeed.


. . .


In Wall Street at the time, there were two groups of private banking firms; those with Jewish partners and those with gentile ones. And while they did business together, often forming syndicates to handle large underwritings, they led separate social lives. They belonged to different clubs, stayed at different hotels and resorts. They didn't attend the weddings of one another's children. The reason, of course, was anti-Semitism. But as Ms. Pak notes, it had nothing to do with the ancient, religiously motivated anti-Semitism typical in Europe. This latter-day anti-Semitism was essentially social in character: To be blunt, it was fashionable to be anti-Semitic.

In earlier decades of the 19th century, affluent Jews had mingled socially with their gentile neighbors. They had been among the founding members of such old-line clubs as the Union Club (est. 1836) and the Union League Club (1863). Jesse Seligman, a partner in the well-regarded Jewish banking firm of J. & W. Seligman, was vice president of the Union League Club in 1893. But when he put his son up for membership that year, he was rejected. "Those who voted against him," a biographer of the Seligman family wrote, "said they had nothing against him personally; they objected to his race." His stunned father resigned from the club. He died the next year, aged 66; some said the incident contributed to his death.



For the full review, see:

JOHN STEELE GORDON. "BOOKSHELF; Book Review: 'Gentlemen Bankers' by Susie J. Pak; In the age of J.P. Morgan, the sons of Jewish bankers attended Ivy League colleges, but were excluded from the myriad social and athletic organizations." The Wall Street Journal (Fri, August 30, 2013): A11.

(Note: ellipsis added.)

(Note: the online version of the review has the date August 29, 2013, and has the title "BOOKSHELF; Book Review: 'Gentlemen Bankers' by Susie J. Pak; In the age of J.P. Morgan, the sons of Jewish bankers attended Ivy League colleges, but were excluded from the myriad social and athletic organizations.")


The book under review, is:

Pak, Susie J. Gentlemen Bankers: The World of J.P. Morgan, Harvard Studies in Business History. Cambridge, MA: Harvard University Press, 2013.







September 29, 2013

2013 Has "Largest One-Year Increase in Arctic Ice" Ever Recorded




(p. A8) Sea ice in the Arctic Ocean underwent a sharp recovery this year from the record-low levels of 2012, with 50 percent more ice surviving the summer melt season, scientists said Friday. It is the largest one-year increase in Arctic ice since satellite tracking began in 1978.


For the full story, see:

JUSTIN GILLIS. "Arctic Ice Makes Comeback From Record Low, but Long-Term Decline May Continue." The New York Times (Sat., September 21, 2013): A8.

(Note: the online version of the story has the date September 20, 2013.)






September 28, 2013

"I Didn't Open My Own Company to Have Someone Else Tell Me How to Run It"




TaylorEdwardEntrepreneur2013-09-25.jpg""They're picking on my employees," Edward Taylor, the president of Down East Seafood, said, referring to the commission." Source of caption and photo: online version of the NYT article quoted and cited below.


(p. A16) The day after Jonathan Sanchez was released from prison in 2010 after serving three years for a burglary, he walked into Down East Seafood in Hunts Point in the South Bronx and asked for a job, and a second chance. He got both.

But now Mr. Sanchez must document the past he has tried to leave behind, in an 11-page application for a photo identification card issued by a city agency that is responsible for ferreting out organized crime. He is one of hundreds of food workers who have come under scrutiny in recent years by the agency, the New York City Business Integrity Commission, not because of any known ties to mob bosses but simply because they work for a company in Hunts Point.


. . .


"This was my brand new start," said Mr. Sanchez, 26, who makes $40,000 a year packing lobster orders.

Mr. Sanchez said he worried that his past crime will follow him from job to job and brand him as an ex-con. "I feel violated because I don't think those things have to be asked," he said. "I feel that it could stigmatize me."


. . .


Edward Taylor, the president of Down East Seafood, said more than half of his 60 employees had told him they did not want to complete the application. A couple of them have even said they would instead quit.

Mr. Taylor, who had to answer similar questions himself to register the company, said he would not have moved to Hunts Point from Manhattan in 2005 if he had known about the commission. The company, which he started in 1990 with $500 borrowed from a friend, supplies more than 700 establishments, including Dean & DeLuca, the Harvard and Yale Clubs and the dining rooms at the United Nations.

"They're picking on my employees," he said. "I didn't open my own company to have someone else tell me how to run it."



For the full story, see:

WINNIE HU. "Food Workers Criticize a Commission's Scrutiny." The New York Times (Sat., September 21, 2013): A16.

(Note: ellipses added.)

(Note: the online version of the story has the date September 20, 2013, and has the title "Food Workers in Hunts Point Criticize a Commission's Scrutiny.")






September 27, 2013

Google's Bathrooms Showed Montessori Discipline




(p. 124) You could even see the company's work/ play paradox in its bathrooms. In some of Google's loos, even the toilets were toys: high-tech Japanese units with heated seats, cleansing water jets, and a control panel that looked as though it could run a space shuttle. But on the side of the stall--and, for men, at an eye-level wall placement at the urinals--was the work side of Google, a sheet of paper with a small lesson in improved coding. A typical "Testing on the Toilet" instructional dealt with the intricacies of load testing or C + + microbenchmarking. Not a second was wasted in fulfilling Google's lofty--and work-intensive--mission.

It's almost as if Larry and Sergey were thinking of Maria Montessori's claim "Discipline must come through liberty.... We do not consider an individual disciplined only when he has been rendered as artificially silent as a mute and as immovable as a paralytic. He is an individual annihilated, not disciplined. We call an individual disciplined when he is master of himself." (p. 125) Just as it was crucial to Montessori that nothing a teacher does destroy a child's creative innocence, Brin and Page felt that Google's leaders should not annihilate an engineer's impulse to change the world by coding up some kind of moon shot.

"We designed Google," Urs Hölzle says, "to be the kind of place where the kind of people we wanted to work here would work for free."



Source:

Levy, Steven. In the Plex: How Google Thinks, Works, and Shapes Our Lives. New York: Simon & Schuster, 2011.

(Note: ellipsis in original.)






September 26, 2013

Some Entrepreneurs Are Motivated by Desire for Personal Wealth




WorthlessImpossibleAndStupidBK2013-09-21.jpg











Source of book image: online version of the WSJ review quoted and cited below.







I have read many biographies of innovative entrepreneurs. Like the author of the review of the book discussed in the passages quoted below, I believe that they have a variety of motives. But I am more optimistic than the book author that many of the entrepreneurs, those I call "project entrepreneurs," are motivated mainly by a desire to 'make a ding in the universe.' Among these I would count Walt Disney and Steve Jobs.


(p. A11) Successful entrepreneurs, in my experience, are tenacious, hardheaded and creative. They persist with their ideas long after others might have given up, and they are good at persuading clients, partners and investors to take a chance. Like successful people in any field, they are driven by a powerful inner need, sometimes positive, like the hunger to do something entirely original, but often less appealing: a large chip on the shoulder, a desire for revenge, a distaste for authority and in many cases flat-out greed.


. . .


In "Worthless, Impossible, and Stupid: How Contrarian Entrepreneurs Create and Capture Extraordinary Value," Daniel Isenberg, a professor of entrepreneurship at Babson College and before that at Harvard Business School, offers many useful stories of entrepreneurship, culled from his teaching experience. But it isn't until two-thirds of the way through that he torturously concedes that every entrepreneur needs a streak of Gordon Gekko.

"I have gradually come to the difficult conclusion that the burning desire for extraordinary value capture is almost a sine qua non for the supreme effort required to convert the value from imagined into tangible value," he writes. "Personal gain is the simplest and most powerful motivation. If a person does not feel deeply that 'This must pay off for me,' there will rarely be extraordinary value creation."



For the full review, see:

PHILIP DELVES BROUGHTON. "BOOKSHELF; Who Moved My Fortune? Some entrepreneurs want to do good. Many more are driven by a chip on the shoulder, a desire for revenge, a distaste for authority." The Wall Street Journal (Sat., July 31, 2013): A11.

(Note: ellipsis added.)

(Note: the online version of the review has the date July 30, 2013.)






September 25, 2013

Office Design that Forces Interaction, Causes Exhaustion, Stress, High Errors and Low Productivity




(p. D1) The big push in office design is forcing co-workers to interact more. Cubicle walls are lower, office doors are no more and communal cafes and snack bars abound.

Like most grand social experiments, though, open-plan offices bring an unintended downside: pesky, productivity-sapping interruptions.

The most common disruptions come from co-workers, as tempting as it is to blame email or instant messaging. Face-to-face interruptions account for one-third more intrusions than email or phone calls, which employees feel freer to defer or ignore, according to a 2011 study in the journal Organization Studies.

Other research published earlier this year links frequent interruptions to higher rates of exhaustion, stress-induced ailments and a doubling of error rates.



For the full story, see:

SUE SHELLENBARGER. "WORK & FAMILY; The Biggest Distraction in the Office Is Sitting Next to You." The Wall Street Journal (Weds., September 11, 2013): D1 & D3.

(Note: the online version of the story has the date September 10, 2013, and has the title "WORK & FAMILY; The Biggest Office Interruptions Are... ...not what most people think. And even a 2-second disruption can lead to a doubling of errors.")


Among the academic papers referred to in the article are:

Wajcman, Judy, and Emily Rose. "Constant Connectivity: Rethinking Interruptions at Work." Organization Studies 32, no. 7 (July 2011): 941-61.

Altmann, Erik M., J. Gregory Trafton, and David Z. Hambrick. "Momentary Interruptions Can Derail the Train of Thought." Journal of Experimental Psychology: General (Jan. 7, 2013): 1-12.






September 24, 2013

Nanny Feds Take Revenge on Zucker for Trying to "Save Our Balls"




ZuckerCraigBuckyballsEntrepreneur2013-08-31.jpg











Craig Zucker. Source of caricature: online version of the WSJ article quoted and cited below.



(p. A11) Mr. Zucker is the former CEO of Maxfield & Oberton, the small company behind Buckyballs, an office toy that became an Internet sensation in 2009 and went on to sell millions of units before it was banned by the feds last year.

A self-described "serial entrepreneur," Mr. Zucker looks the part with tussled black hair, a scraggly beard and hipster jeans. Yet his casual-Friday outfit does little to subdue his air of ambition and hustle.

Nowadays Mr. Zucker spends most of his waking hours fighting off a vindictive U.S. Consumer Product Safety Commission that has set out to punish him for having challenged its regulatory overreach. The outcome of the battle has ramifications far beyond a magnetic toy designed for bored office workers. It implicates bedrock American notions of consumer choice, personal responsibility and limited liability.


. . .


In August 2009, Maxfield & Oberton demonstrated Buckyballs at the New York Gift Show; 600 stores signed up to sell the product. By 2010, the company had built a distribution network of 1,500 stores, including major retailers like Urban Outfitters and Brookstone. People magazine in 2011 named Buckyballs one of the five hottest trends of the year, and in 2012 it made the cover of Brookstone's catalog.

Maxfield & Oberton now had 10 employees, 150 sales representatives and a distribution network of 5,000 stores. Sales had reached $10 million a year. "Then," says Mr. Zucker, "we crashed."

On July 10, 2012, the Consumer Product Safety Commission instructed Maxfield & Oberton to file a "corrective-action plan" within two weeks or face an administrative suit related to Buckyballs' alleged safety defects. Around the same time--and before Maxfield & Oberton had a chance to tell its side of the story--the commission sent letters to some of Maxfield & Oberton's retail partners, including Brookstone, warning of the "severity of the risk of injury and death possibly posed by" Buckyballs and requesting them to "voluntarily stop selling" the product.

It was an underhanded move, as Maxfield & Oberton and its lawyers saw it. "Very, very quickly those 5,000 retailers became zero," says Mr. Zucker. The preliminary letters, and others sent after the complaint, made it clear that selling Buckyballs was still considered lawful pending adjudication. "But if you're a store like Brookstone or Urban Outfitters . . . you're bullied into it. You don't want problems."


. . .


Maxfield & Oberton resolved to take to the public square.On July 27, just two days after the commission filed suit, the company launched a publicity campaign to rally customers and spotlight the commission's nanny-state excesses. The campaign's tagline? "Save Our Balls."

Online ads pointed out how, under the commission's reasoning, everything from coconuts ("tasty fruit or deadly sky ballistic?") to stairways ("are they really worth the risk?") to hot dogs ("delicious but deadly") could be banned.


. . .


. . . in February [2013] the Buckyballs saga took a chilling turn: The commission filed a motion requesting that Mr. Zucker be held personally liable for the costs of the recall, which it estimated at $57 million, if the product was ultimately determined to be defective.

This was an astounding departure from the principle of limited liability at the heart of U.S. corporate law.


. . .


Given the fact that Buckyballs have now long been off the market, the attempt to go after Mr. Zucker personally raises the question of retaliation for his public campaign against the commission. Mr. Zucker won't speculate about the commission's motives. "It's very selective and very aggressive," he says.



For the full interview, see:

SOHRAB AHMARI, interviewer. "THE WEEKEND INTERVIEW with Craig Zucker; What Happens When a Man Takes on the Feds; Buckyballs was the hottest office game on the market. Then regulators banned it. Now the government wants to ruin the CEO who fought back." The Wall Street Journal (Sat., August 31, 2013): A11.

(Note: ellipses, and bracketed year, added.)

(Note: the online version of the interview has the date August 30, 2013, and has the title "THE WEEKEND INTERVIEW; Craig Zucker: What Happens When a Man Takes on the Feds. Buckyballs was the hottest office game on the market. Then regulators banned it. Now the government wants to ruin the CEO who fought back.")





September 23, 2013

Montessori Taught Larry Page and Sergey Brin to Always Ask Questions




(p. 122) "Their attitude is just like, 'We're Montessori kids,'" said Mayer. "We've been trained and programmed to question authority."

Thus it wasn't surprising to see that attitude as the foundation of Google's culture. "Why aren't there dogs at work?" asked Marissa, parroting the never-ending Nerdish Inquisition conducted by her bosses. "Why aren't there toys at work? Why aren't snacks free? Why? Why? Why?"

"I think there's some truth to that," says Larry Page, who spent his preschool and first elementary school years at Okemos Montessori Radmoor School in Michigan. "I'm always asking questions, and Sergey and I both have this."

Brin wound up in Montessori almost by chance. When he was six, recently emigrated from the Soviet Union, the Paint Branch Montessori (p. 123) School in Adelphi, Maryland, was the closest private school. "We wanted to place Sergey in a private school to ease up his adaptation to the new life, new language, new friends," wrote his mother, Eugenia Brin, in 2009. "We did not know much about the Montessori method, but it turned out to be rather crucial for Sergey's development. It provided a basis for independent thinking and a hands-on approach to life."

"Montessori really teaches you to do things kind of on your own at your own pace and schedule," says Brin. "It was a pretty fun, playful environment-- as is this."



Source:

Levy, Steven. In the Plex: How Google Thinks, Works, and Shapes Our Lives. New York: Simon & Schuster, 2011.

(Note: italics in original.)






September 22, 2013

Growth of Labor Safety Net Made Great Recession Deeper and Longer




TheRedistributionRecessionBK2013-09-05.jpg











Source of book image: http://si.wsj.net/public/resources/images/OB-VE881_bkrvre_GV_20121101145828.jpg






(p. 309) [Mulligan's empirical results suggest] that employment was dropping not only because of declining demand for the employees' products, but also because employers were substituting capital and other factors for labor. This surprising finding suggests that although a decline in aggregate demand for goods and services was one of the reasons for the decline in labor, other causes were also at play in most sectors of the economy. This fact is consistent with an inward shift in the supply of labor to the marketplace during this period.

In chapter 3, Mulligan introduces the main culprit responsible for this supplycurve shift--the unintended consequences of increases in the social safety net that substantially increased the marginal tax rate on work. In his model, Mulligan operationalizes this force into changes in the replacement rate (the fraction of productivity that the average nonemployed person receives in the form of means-tested benefits) and the self-reliance rate (1 minus the replacement rate), which is the fraction of lost productivity not replaced by means-tested benefits.

His conjecture is that, in a reverse of government policies in the 1990s that made work pay for single mothers by transforming welfare as we knew it into a program that nudged single mothers off the Aid to Families with Dependent Children rolls and into the workforce, "temporary" government program expansions to mitigate the (p. 310) short-run consequences of unemployment and the bursting of the housing bubble made a prolonged paid period of nonwork an offer that many Americans found too tempting to refuse.

Mulligan identifies and incorporates the major expansions in eligibility and benefit amounts for Unemployment Insurance and food stamps into an eligibility index that shows that most of the 199 percent growth in these programs between 2007 and 2009 was due to these changes. He uses this growth rate in a weighted index of overall statutory safety-net generosity to determine the degree to which it has influenced overall employment. He does a similar analysis of the means-tested Home Affordable Modification Program (HAMP), which facilitated substantial lender-provided discounts on home mortgage expenses for unemployment insurance-eligible workers. He finds that these market distortions that increased the marginal tax on work grew substantially in 2008, peaked in 2009--at almost triple their 2007 level--and then modestly fell in 2010 to a level appreciably above the 2007 level.


. . .


But his empirical evidence shows that the implementation of these "recession cures" was primarily responsible for the Great Recession's depth and duration.



For the full review, see:

Burkhauser, Richard V. "Review of: "The Redistributive Recession: How Labor Market Distortions Contracted the Economy" by Casey B. Mulligan." The Independent Review 18, no. 2 (Fall 2013): 308-11.

(Note: ellipsis, and words in brackets, added.)


Book that is under review:

Mulligan, Casey B. The Redistribution Recession: How Labor Market Distortions Contracted the Economy. New York: Oxford University Press, USA, 2012.






September 21, 2013

Messy Offices Encourage Creativity




(p. 12) Forty-eight research subjects came individually to our laboratory, . . . assigned to messy or tidy rooms.   . . . , we told subjects to imagine that a Ping-Pong ball factory needed to think of new uses for Ping-Pong balls, and to write down as many ideas as they could. We had independent judges rate the subjects' answers for degree of creativity, which can be done reliably.   . . .

When we analyzed the responses, we found that the subjects in both types of rooms came up with about the same number of ideas, which meant they put about the same effort into the task. Nonetheless, the messy room subjects were more creative, as we expected. Not only were their ideas 28 percent more creative on average, but when we analyzed the ideas that judges scored as "highly creative," we found a remarkable boost from being in the messy room -- these subjects came up with almost five times the number of highly creative responses as did their tidy-room counterparts.


. . .


Our findings have practical implications. There is, for instance, a minimalist design trend taking hold in contemporary office spaces: out of favor are private walled-in offices -- and even private cubicles. Today's office environments often involve desk sharing and have minimal "footprints" (smaller office space per worker), which means less room to make a mess.

At the same time, the working world is abuzz about cultivating innovation and creativity, endeavors that our findings suggest might be hampered by the minimalist movement. While cleaning up certainly has its benefits, clean spaces might be too conventional to let inspiration flow.



For the full commentary, see:

KATHLEEN D. VOHS. "GRAY MATTER; It's Not 'Mess.' It's Creativity." The New York Times, SundayReview Section (Sun., September 15, 2013): 12.

(Note: ellipses added.)

(Note: the online version of the commentary has the date September 13, 2013.)


The main academic paper referred to in the commentary is:

Vohs, Kathleen D., Joseph P. Redden, and Ryan Rahinel. "Physical Order Produces Healthy Choices, Generosity, and Conventionality, Whereas Disorder Produces Creativity." Psychological Science 24, no. 9 (Sept. 2013): 1860-67.






September 20, 2013

Brazil's Cardozo Envies England's Rule of Law




PalinMichael2013-08-31.jpg















"Michael Palin." Source of caption and photo: online version of the WSJ article quoted and cited below.



(p. C11) For his most recent project in Brazil, which will go on to become a PBS series, Mr. Palin interviewed former Brazilian President Fernando Cardoso, who is often credited with the country's economic turnaround. Whereas he says most political leaders are hesitant to say anything controversial, Mr. Cardoso was refreshingly straightforward. "I asked him, 'Brazil has so many good things going for it--the people are friendly and relaxed, the economy is booming. Is there anything you envy about us in England?' " He was surprised by Mr. Cardoso's answer. "He said straight out, 'The rule of law.' He said, 'Our problem here is we have endemic corruption,' " says Mr. Palin. "I just thought it was incredibly honest for a world leader."


For the full story, see:

ALEXANDRA WOLFE. "WEEKEND CONFIDENTIAL; Michael Palin Takes on the World; The former Monty Python performer is turning his global adventures into comic tales." The Wall Street Journal (Sat., August 31, 2013): C11.

(Note: ellipsis added.)

(Note: the online version of the commentary has the date August 30, 2013.)






September 19, 2013

Key to Google: "Both Larry and Sergey Were Montessori Kids"




(p. 121) [Marissa Mayer] conceded that to an outsider, Google's new-business process might indeed look strange. Google spun out projects like buckshot, blasting a spray and using tools and measurements to see what it hit. And sometimes it did try ideas that seemed ill suited or just plain odd. Finally she burst out with her version of the corporate Rosebud. "You can't understand Google," she said, "unless you know that both Larry and Sergey were Montessori kids."

"Montessori" refers to schools based on the educational philosophy of Maria Montessori, an Italian physician born in 1870 who believed that children should be allowed the freedom to pursue what interested them.

(p. 122) "It's really ingrained in their personalities," she said. "To ask their own questions, do their own things. To disrespect authority. Do something because it makes sense, not because some authority figure told you. In Montessori school you go paint because you have something to express or you just want to do it that afternoon, not because the teacher said so. This is really baked into how Larry and Sergey approach problems. They're always asking 'Why should it be like that?' It's the way their brains were programmed early on."



Source:

Levy, Steven. In the Plex: How Google Thinks, Works, and Shapes Our Lives. New York: Simon & Schuster, 2011.

(Note: bracketed name added.)






September 18, 2013

To Save Lego, CEO Fired Almost a Third of Workers




BrickByBrickBK2013-09-02.jpg











Source of book image: online version of the WSJ review quoted and cited below.







(p. A15) Only 10 years ago, Lego was posting record losses; retailers were backlogged with unsold Lego toys; and it was unclear whether Lego would survive as an independent company. An internal review discovered that 94% of the sets in its product line were unprofitable. The turnaround story that followed is well told by Wharton professor David Robertson in "Brick by Brick."


. . .


Upon coming to power, Mr. Knudstorp cut 30% of Lego's product portfolio, including many of its newer offerings. To stave off financial doom, he also sold the company's headquarters building and moved into simpler accommodations--and, more painfully, let go almost a third of the workforce.

But how to move beyond the rescue stage and toward growth? Based on input from top retailers and a large customer-research study, Lego executives concluded that even though young fans of buildable toys were a minority, there were enough of them to make a worthwhile market--and their parents were willing to pay premium prices. The company would now organize its innovation efforts around its potentially very profitable core audience.

Mr. Robertson, with the benefit of access to staff at Lego and partner companies, provides unusually detailed reporting of the processes that led to Lego's current hits (and, inevitably, some misses). Among the hits is the Mindstorms NXT, the second generation of Lego's robotics set, which hadn't been updated or advertised since 2001. Mr. Robertson describes how Lego navigated between relying on sophisticated users to determine the product's design and relying on its own expertise in the creation of building experiences.



For the full review, see:

DAVID A. PRICE. "BOOKSHELF; The House That Lego Built; Lego balked at licensing warlike 'Star Wars' toys. But then anthropological research convinced company executives that kids like to compete." The Wall Street Journal (Tues., July 23, 2013): A15.

(Note: ellipsis added.)

(Note: the online version of the review has the date July 22, 2013.)


The book under review, is:

Robertson, David. Brick by Brick: How Lego Rewrote the Rules of Innovation and Conquered the Global Toy Industry. New York: Crown Business, 2013.






September 17, 2013

For Innovator It Is Better to Use Wealth to Innovate than to Donate




JobsSteve2013-09-02.jpg
"Steve Jobs, a founder of Apple, has focused on his work to improve the lives of millions of people through technology." Source of caption and photo: online version of the NYT article quoted and cited below.





The column quoted below, written before Steve Jobs' death, asks an important question: should an innovative entrepreneur be a prominent philanthropist? I believe that innovative entrepreneurs can often do the most good by using their wealth to innovate rather than to donate.



(p. B1) Steve Jobs is a genius. He is an innovator. A visionary. He is perhaps the most beloved billionaire in the world.

Surprisingly, there is one thing that Mr. Jobs is not, at least not yet: a prominent philanthropist.

Despite accumulating an estimated $8.3 billion fortune through his holdings in Apple and a 7.4 percent stake in Disney (through the sale of Pixar), there is no public record of Mr. Jobs giving money to charity. He is not a member of the Giving Pledge, the organization founded by Warren E. Buffett and Bill Gates to persuade the nation's wealthiest families to pledge to give away at least half their fortunes. (He declined to participate, according to people briefed on the matter.) Nor is there a hospital wing or an academic building with his name on it.

None of this is meant to judge Mr. Jobs. I have long been a huge admirer of Mr. Jobs and consider him the da Vinci of our time.


. . .


(p. B4) . . . Mr. Jobs has always been upfront about where he has chosen to focus. In an interview with The Wall Street Journal in 1993 , he said, "Going to bed at night saying we've done something wonderful ... that's what matters to me."



For the full commentary, see:

ANDREW ROSS SORKIN. "DEALBOOK COLUMN; The Mystery of Steve Jobs's Public Giving." The New York Times (Tues., AUGUST 30, 2011): B1 & B4.

(Note: ellipsis between paragraphs added; ellipsis within last paragraph, in original.)

(Note: the online version of the commentary has the date AUGUST 29, 2011.)







September 16, 2013

Frank Lloyd Wright Loved Cars




CordL29OwnedByFrankLloydWright2013-08-10.jpg "In the early 1920s, Wright bought a 1929 Cord L-29, which he praised for its sensible front-wheel drive. Besides, "It looked becoming to my houses," he wrote in his book "An Autobiography." He seemed to have a special bond with the Cord. "The feeling comes to me that the Cord should be heroic in this autobiography somewhere," he wrote." Source of caption and photo: online version of the NYT article quoted and cited below.



(p. 9) Frank Lloyd Wright, the architect whose birth in 1867 preceded the gasoline-powered automobile's by about 20 years, was an early adopter of the internal-combustion engine and an auto aficionado all his life.

He was also eerily prophetic in understanding how the car would transform the American landscape, and his designs reflect this understanding. Wright often designed both for and around automobiles, and his masterpiece, the Guggenheim Museum in New York, owes its most distinctive feature, the spiral of its rotunda, to his love for the automobile.


. . .


Wright was seduced by the combination of beauty, power and speed, whether powered by hay or by gas. He owned horses, and his first car, a yellow Model K Stoddard-Dayton roadster, was the same model that in 1909 won the very first automobile race at the Indianapolis Motor Speedway. Called the Yellow Devil by his neighbors, this was a 45-horsepower car capable of going 60 miles an hour. Wright and his sons seemed to enjoy that horsepower with abandon: "Dad was kept busy paying fines," his son John observed. So enamored was Wright of his automobile that he installed gas pumps in the garage of his home and studio in Oak Park, Ill.


. . .


In the early 1920s, Wright owned a custom-built Cadillac and later bought a 1929 Cord L-29, which he praised for its sensible front-wheel drive. Besides, "It looked becoming to my houses," he wrote in his book "An Autobiography." He seemed to have a special bond with the Cord. "The feeling comes to me that the Cord should be heroic in this autobiography somewhere," he wrote.

Wright's Cord can be seen today at the Auburn Cord Duesenberg Museum in Auburn, Ind.



For the full story, see:

INGRID STEFFENSEN. "Frank Lloyd Wright: The Auto as Architect's Inspiration." The New York Times, SportsSunday Section (Sun., August 9, 2009): 9.

(Note: ellipses added.)

(Note: the online version of the article has the date August 6, 2009 and the title "The Auto as Architect's Inspiration." There are some small differences between the print and online versions, although I think the sentences quoted above are the same in both.)


Wright's autobiography, mentioned above, is:

Wright, Frank Lloyd. An Autobiography. New York: Horizon Press, 1977.






September 15, 2013

When Google Earned a Profit, Sergey Brin "Felt Like We Had Built a Real Business"




(p. 94) . . . , Google was reaping rewards, and 2002 was its first profitable year. "That's really satisfying," Brin said at the time. "Honestly, when we were still in the dot-com boom days, I felt like a schmuck. I had an Internet start-up-- so did everybody else. It was unprofitable, like everybody else's, and how hard is that? But when we became profitable, I felt like we had built a real business."


Source:

Levy, Steven. In the Plex: How Google Thinks, Works, and Shapes Our Lives. New York: Simon & Schuster, 2011.

(Note: ellipsis added.)






September 14, 2013

Why "Experts" Censor Their Views to Conform to the Consensus




GroupthinkBK2013-09-02.jpg














Source of book image: http://thesituationist.files.wordpress.com/2008/02/irving-janis-groupthink.jpg?w=197&h=290



(p. 5) In his classic 1972 book, "Groupthink," Irving L. Janis, the Yale psychologist, explained how panels of experts could make colossal mistakes. People on these panels, he said, are forever worrying about their personal relevance and effectiveness, and feel that if they deviate too far from the consensus, they will not be given a serious role. They self-censor personal doubts about the emerging group consensus if they cannot express these doubts in a formal way that conforms with apparent assumptions held by the group.


For the full commentary, see:

ROBERT J. SHILLER. "ECONOMIC VIEW; Challenging the Crowd in Whispers, Not Shouts." The New York Times, SundayBusiness Section (Sun., November 2, 2008): 5.

(Note: the online version of the commentary has the date November 1, 2008.)


The reference for the second, and last, edition of the Janis book, is:

Janis, Irving L. Groupthink: Psychological Studies of Policy Decisions and Fiascoes. 2nd (pb) ed. Boston, MA: Wadsworth Cengage Learning, 1982.






September 13, 2013

Climate Scientists Are Puzzled by "Lull" in Global Warming, Even with "Record Pace" of Greenhouse Gases




(p. D3) As unlikely as this may sound, we have lucked out in recent years when it comes to global warming.

The rise in the surface temperature of earth has been markedly slower over the last 15 years than in the 20 years before that. And that lull in warming has occurred even as greenhouse gases have accumulated in the atmosphere at a record pace.

The slowdown is a bit of a mystery to climate scientists.



For the full story, see:

JUSTIN GILLIS. "BY DEGREES; What to Make of a Warming Plateau." The New York Times (Tues., June 11, 2013): D3.

(Note: the online version of the story has the date June 10, 2013.)






September 12, 2013

Why IT-Savy Companies Are More Profitable




WeillPeterMIT2013-08-10.jpg











Dr. Peter Weill, Chair of the Center for Information Systems Research at the MIT Sloan School of Management. Source of caption information and photo: online version of the WSJ article quoted and cited below.




(p. R2) DR. WEILL: The IT-savvy companies are 21% more profitable than non-IT-savvy companies. And the profitability shows up in two ways. One is that IT-savvy companies have identified the best way to run their core day-to-day processes. Think about UPS or Southwest Airlines or Amazon: They run those core processes flawlessly, 24 hours a day.

The second thing is that IT-savvy companies are faster to market with new products and services that are add-ons, because their innovations are so much easier to integrate than in a company with siloed technology architecture, where you have to glue together everything and test it and make sure that it all works. We call that the agility paradox--the companies that have more standardized and digitized business processes are faster to market and get more revenue from new products.

Those are the two sources of their greater profitability: lower costs for running existing business processes, and faster innovation.



For the full interview, see:

Martha E. Mangelsdorf, interviewer. "EXECUTIVE BRIEFING; Getting an Edge From IT; Companies need to think strategically about their tech investments." The Wall Street Journal (Mon., November 30, 2009): R2.

(Note: bold in original.)






September 11, 2013

Yahoo Execs Complained that Google Did Yahoo Searches too Well




(p. 45) Even though Google never announced when it refreshed its index, there would invariably be a slight rise in queries around the world soon after the change was implemented. It was as if the global subconscious realized that there were fresher results available.

The response of Yahoo's users to the Google technology, though, was probably more conscious. They noticed that search was better and used it more. "It increased traffic by, like, 50 percent in two months," Manber recalls of the switch to Google. But the only comment he got from Yahoo executives was complaints that people were searching too much and they would have to pay higher fees to Google.

But the money Google received for providing search was not the biggest benefit. Even more valuable was that it now had access to many more users and much more data. It would be data that took Google search to the next level. The search behavior of users, captured and encapsulated in the logs that could be analyzed and mined, would make Google the ultimate learning machine.



Source:

Levy, Steven. In the Plex: How Google Thinks, Works, and Shapes Our Lives. New York: Simon & Schuster, 2011.






September 10, 2013

Margaret Thatcher Funeral: "Suddenly from the Crowd a Great Roar"




ThatcherSupporterWithSign203-09-02.jpg "A supporter of Margaret Thatcher holds a banner outside St. Clement Danes church in London." Source of caption and photo: online version of the WSJ article quoted and cited below.



(p. A15) The funeral of Margaret Thatcher was beautiful, moving, just right. It had dignity and spirit, and in that respect was just like her. It also contained a surprise that shouldn't have been a surprise. It was a metaphor for where she stood in the pantheon of successful leaders of the 20th century.


. . .


At the end of the funeral they all marched down the aisle in great procession--the family, the queen, the military pallbearers carrying the casket bearing the Union Jack. The great doors flung open, the pallbearers marched forward, and suddenly from the crowd a great roar. We looked at each other. Demonstrators? No. Listen. They were cheering. They were calling out three great hurrahs as the pallbearers went down the steps. Then long cheers and applause. It was electric.

England came. The people came. Later we would learn they'd stood 30 deep on the sidewalk, that quiet crowds had massed on the Strand and Fleet Street and Ludgate Hill. A man had held up a sign: "But We Loved Her."

. . . When they died, Ronald Reagan, John Paul II, and Margaret Thatcher were old and long past their height of power. Everyone was surprised when Reagan died that crowds engulfed the Capitol; people slept on sidewalks to view him in state. When John Paul died the Vatican was astonished to see millions converge. "Santo Subito."

And now at the end some came for Thatcher, too.

What all three had in common: No one was with them but the people.

Margaret Hilda Thatcher, rest in peace.



For the full commentary, see:

PEGGY NOONAN. "DECLARATIONS; Britain Remembers a Great Briton; Margaret Thatcher's coffin stood over he crypts that hold the tombs of Nelson and Wellington. It mattered." The Wall Street Journal (Sat., April 20, 2013): A15.

(Note: the online version of the story was updated April 22, 2013 (I did not see any update in the part I quoted above), and has the title "DECLARATIONS; Noonan: Britain Remembers a Great Briton; Mrs. Thatcher is with Wellington and Nelson now.")






September 9, 2013

Silicon Valley May Be Insulated from the Jobs Ordinary People Need to Get Done





A long while ago I read somewhere that in his prime Bill Gates deliberately tested Microsoft software on the limited hardware that mainstream customers could afford, rather than on the cutting edge hardware he himself could easily afford. I thought that this gave an important clue to Gates' and Microsoft's success.

Christensen and Raynor (2003) suggest that the successful entrepreneur will think hard about what jobs ordinary people want to get done, but are having difficulty doing.

The passages quoted below suggest that Silicon Valley entrepreneurs are insulated from ordinary life, and so may need to work harder at learning what the real problems are.



(p. B5) Engineers tend to move to the Bay Area because of the opportunity to get together with other engineers and, just maybe, create a great company, Mr. Smith said. But in a region that has the highest concentration of tech workers in the United States, according to the Bureau of Labor Statistics, the bars, restaurants and other haunts of entrepreneurs can be an echo chamber. The result can be a focus on solutions for mundane problems.


. . .


. . . too often, says Jason Pontin, the editor in chief and publisher of MIT Technology Review, . . . start-ups are solving "fake problems that don't actually create any value." Mr. Pontin knows a thing or two about companies that aren't exactly reaching for the stars. From 1996 to 2002, he was the editor of Red Herring, a magazine in San Francisco that chronicled the region's dot-com boom and eventual collapse.



For the full commentary, see:

NICK BILTON. "Disruptions: The Echo Chamber of Silicon Valley." The New York Times (Mon., June 3, 2013): B5.

(Note: ellipses added.)

(Note: the online version of the commentary has the date June 2, 2013.)


The Christensen and Raynor book that I mention above, is:

Christensen, Clayton M., and Michael E. Raynor. The Innovator's Solution: Creating and Sustaining Successful Growth. Boston, MA: Harvard Business School Press, 2003.






September 8, 2013

How to Win the Nobel Prize with Dyslexia




GreiderCarolDyslexicNobelPrizeWinner2013-08-10.jpg "HER TURN; Dr. Carol W. Greider is a researcher at Johns Hopkins." Source of caption and photo: online version of the NYT interview quoted and cited below.



(p. D1) Q. Did you always want to be a biologist?

A. My parents were scientists. But I wasn't the sort of child who did science fairs. One of the things I was thinking about today is that as a kid I had dyslexia. I had a lot of trouble in school and was put into remedial classes. I thought that I was stupid.

Q. That must have hurt.

A. Sure. Yes. It was hard to overcome (p. D3) that. I kept thinking of ways to compensate. I learned to memorize things very well because I just couldn't spell words. So later when I got to take classes like chemistry and anatomy where I had to memorize things, it turned out I was very good at that.

I never planned a career. I had these blinders on that got me through a lot of things that might have been obstacles. I just went forward. It's a skill that I had early on that must have been adaptive. I enjoyed biology in high school and that brought me to a research lab at U.C. Santa Barbara. I loved doing experiments and I had fun with them. I realized this kind of problem-solving fit my intellectual style. So in order to continue having fun, I decided to go to graduate school at Berkeley. It was there that I went to Liz Blackburn's lab, where telomeres were being studied.



For the full interview, see:

CLAUDIA DREIFUS. "A CONVERSATION WITH CAROL W. GREIDER; On Winning a Nobel Prize in Science." The New York Times (Tues., October 13, 2009): D1 & D3.

(Note: bold in original; questions capitalized as in print version.)

(Note: the online version of the interview has the date October 12, 2009.)






September 7, 2013

Yahoo Valued "Marketing Gimmicks" More than Search Speed




(p. 44) Google had struck a deal to handle all the search traffic of Yahoo, one of the biggest portals on the web.

The deal--announced on June 26, 2000--was a frustrating development to the head of Yahoo's search team, Udi Manber. He had been arguing that Yahoo should develop its own search product (at the time, it was licensing technology from Inktomi), but his bosses weren't interested. Yahoo's executives, led by a VC-approved CEO named Timothy Koogle (described in a BusinessWeek cover story as "The Grown-up Voice of Reason at Yahoo"), instead were devoting their attention to branding--marketing gimmicks such as putting the purple corporate logo on the Zamboni machine that swept the ice between periods of San Jose Sharks hockey games. "I had six people working on my search team," Manber said. "I couldn't get the seventh. This was a company that had thousands of people. I could not get the seventh." Since Yahoo wasn't going to develop its own search, Manber had the task of finding the best one to license.



Source:

Levy, Steven. In the Plex: How Google Thinks, Works, and Shapes Our Lives. New York: Simon & Schuster, 2011.

(Note: italics in original.)






September 6, 2013

In Conflict Between Ecologist and Economist, the Economist Won




EhrlichSimonCaricature2013-08-31.jpg Paul Ehrlich (left) and Julian Simon (right). Source of caricature: online version of the WSJ review quoted and cited below.



(p. C6) . . . in 1980 Simon made Mr. Ehrlich a bet. If Mr. Ehrlich's predictions about overpopulation and the depletion of resources were correct, Simon said, then over the next decade the prices of commodities would rise as they became more scarce. Simon contended that, because markets spur innovation and create efficiencies, commodity prices would fall. He proposed that each party put up $1,000 to purchase a basket of five commodities. If the prices of these went down, Mr. Ehrlich would pay Simon the difference between the 1980 and 1990 prices. If the prices went up, Simon would pay. This meant that Mr. Ehrlich's exposure was limited while Simon's was theoretically infinite.


. . .


In October 1990, Mr. Ehrlich mailed a check for $576.07 to Simon.


. . .


Mr. Ehrlich was more than a sore loser. In 1995, he told this paper: "If Simon disappeared from the face of the Earth, that would be great for humanity." (Simon would die in 1998.)


. . .


Mr. Sabin's portrait of Mr. Ehrlich suggests that he is among the more pernicious figures in the last century of American public life. As Mr. Sabin shows, he pushed an authoritarian vision of America, proposing "luxury taxes" on items such as diapers and bottles and refusing to rule out the use of coercive force in order to prevent Americans from having children. In many ways, Mr. Ehrlich was an early instigator of the worst aspects of America's culture wars. This picture is all the more damning because Mr. Sabin paints it not with malice but with sympathy. A history professor at Yale, Mr. Sabin shares Mr. Ehrlich's devotion to environmentalism. Yet this affinity doesn't prevent Mr. Sabin from being clear-eyed.

At heart, "The Bet" is about not just a conflict of men; it is about a conflict of disciplines, pitting ecologists against economists. Mr. Sabin cautiously posits that neither side has been completely vindicated by the events of the past 40 years. But this may be charity on his part: While not everything Simon predicted has come to pass, in the main he has been vindicated.


. . .


Mr. Ehrlich may have been defeated in the wager, but he has continued to flourish in the public realm. The great mystery left unsolved by "The Bet" is why Paul Ehrlich and his confederates have paid so small a price for their mistakes. And perhaps even been rewarded for them. In 1990, just as Mr. Ehrlich was mailing his check to Simon, the MacArthur Foundation awarded him one of its "genius" grants. And 20 years later his partner in the wager, John Holdren, was appointed by President Obama to be director of the White House Office of Science and Technology Policy.



For the full review, see:

JONATHAN V. LAST. "A Prediction that Bombed; Paul Ehrlich predicted an imminent population catastrophe; Julian Simon wagered he was wrong." The Wall Street Journal (Sat., August 31, 2013): C6.

(Note: ellipses added.)

(Note: the online version of the review has the date August 30, 2013, and has the title "Book Review: 'The Bet' by Paul Sabin; Paul Ehrlich predicted an imminent population catastrophe--Julian Simon wagered he was wrong.")


The book discussed above is:

Sabin, Paul. The Bet: Paul Ehrlich, Julian Simon, and Our Gamble over Earth's Future. New Haven, Conn.: Yale University Press, 2013.



TheBetBK2013-08-31.jpg














Source of book image: http://paulsabin.com/wp-content/uploads/2013/06/sabin_the_bet_wr.jpg







September 5, 2013

Venezuelan Socialists Seize Private Toilet Paper




(p. A6) CARACAS, Venezuela (AP) -- Police in Venezuela say they have seized nearly 2,500 rolls of toilet paper in an overnight raid of a clandestine warehouse storing scarce goods.


. . .


The socialist government says the shortages are part of a plot by opponents to destabilize the country. Economists blame the government's price and currency controls.



For the full story, see:

AP. "World; Police Seize 2,500 Rolls of Toilet Paper." Omaha World-Herald (Fri., May 31, 2013): 6A.

(Note: ellipsis added.)





September 4, 2013

"The Ecosystem Is More Intact than You Might Have Feared"




SantaMartaSabrewingRareBirdFearedExtinct2013-08-10.jpg "The first-ever photograph of the Santa Marta sabrewing." Source of caption and photo: online version of the NYT article quoted and cited below.


Michael Parr, quoted in the entry below, is Vice President of Planning and Program Development of the American Bird Conservancy as of 8/10/13 (as listed on: http://www.abcbirds.org/aboutabc/staff.html ).


(p. D3) Rare birds in isolated habitats can be a recipe for extinction, and while there had been a few unconfirmed sightings of the sabrewing in recent years, the bird's existence had not been documented for decades. Until March 24, that is, when a researcher studying migratory birds, Laura Cárdenas, caught one in a mist net, banded it and took its picture before releasing it. It's the first photograph ever of a Santa Marta sabrewing.

"She had a little bit of luck," Mr. Parr said. "The bird just flew into the net, completely by chance."


. . .


The sighting shows that "the ecosystem is more intact than you might have feared," he added.



For the full story, see:

HENRY FOUNTAIN. "OBSERVATORY; Rare Bird, Alive and Well and Living in Colombia." The New York Times (Tues., April 13, 2010): D3.

(Note: the online version of the article has the date April 12, 2010.)






September 3, 2013

Redundancy Allowed Google to Function with Cheap and Failure-Prone Hard Drives




(p. 42) . . . as the web kept growing, Google added more machines--by the end of 1999, there were eighty machines involved in the crawl (out of a total of almost three thousand Google computers at that time)--and the likelihood that something would break increased dramatically. Especially since Google made a point of buying what its engineers referred to as "el cheapo" equipment. Instead of commercial units that carefully processed and checked information, Google would buy discounted consumer models without built-in processes to protect the integrity of data.

As a stopgap measure, the engineers had implemented a scheme where the indexing data was stored on different hard drives. If a machine went bad, everyone's pager would start buzzing, even if it was the middle of the night, and they'd barrel into the office immediately to stop the crawl, copy the data, and change the configuration files. "This happened every few days, and it basically stopped everything and was very painful," says Sanjay Ghemawat, one of the DEC research wizards who had joined Google.


. . .


(p. 43) The experience led to an ambitious revamp of the way the entire Google infrastructure dealt with files. "I always had wanted to build a file system, and it was pretty clear that this was something we were going to have to do," says Ghemawat, who led the team. Though there had previously been systems that handled information distributed over multiple files, Google's could handle bigger data loads and was more nimble at running full speed in the face of disk crashes-- which it had to be because, with Google's philosophy of buying supercheap components, failure was the norm. "The main idea was that we wanted the file system to automate dealing with failures, and to do that, the file system would keep multiple copies and it would make new copies when some copy failed," says Ghemawat.



Source:

Levy, Steven. In the Plex: How Google Thinks, Works, and Shapes Our Lives. New York: Simon & Schuster, 2011.

(Note: ellipses added.)






September 2, 2013

Jeb Bush Reads Clayton Christensen on His Kindle




BushJebCaricature2013-08-12.jpg














Jeb Bush. Source of caricature: online version of the WSJ article quoted and cited below.




Clayton Christensen is a kindred spirit: he cares about making the world a better place through innovation in free markets. He research is almost always thought-provoking, and sometimes highly illuminating. So it speaks well of Jeb Bush that he has the good judgement to be reading one of Christensen's books on education.


(p. A11) Currently [Bush is] reading "Disrupting Class: How Disruptive Innovation Will Change the Way the World Learns" -- on his Kindle electronic reader.


For the full interview, see:

FRED BARNES. "THE WEEKEND INTERVIEW with JEB BUSH; Republicans Must Be a National Party Florida's former governor on immigration, school choice, and the GOP's limited-government foundation." The Wall Street Journal (Sat., February 14, 2009): A11.

(Note: words in brackets added.)


The Christensen book mentioned on education, is:

Christensen, Clayton M., Curtis W. Johnson, and Michael B. Horn. Disrupting Class: How Disruptive Innovation Will Change the Way the World Learns. New York: NY: McGraw-Hill, 2008.

(Note: a revised edition of the book appeared in 2011.)






September 1, 2013

"Inflexible Labor Laws" Lead Indian Firms "to Substitute Machines for Unskilled Labor"




(p. A19) . . . , India is failing to make full use of the estimated one million low-skilled workers who enter the job market every month.

Manufacturing requires transparent rules and reliable infrastructure. India is deficient in both. High-profile scandals over the allocation of mobile broadband spectrum, coal and land have undermined confidence in the government. If land cannot be easily acquired and coal supplies easily guaranteed, the private sector will shy away from investing in the power grid. Irregular electricity holds back investments in factories.

India's panoply of regulations, including inflexible labor laws, discourages companies from expanding. As they grow, large Indian businesses prefer to substitute machines for unskilled labor.



For the full commentary, see:

ARVIND SUBRAMANIAN. "Why India's Economy Is Stumbling." The New York Times (Sat., August 31, 2013): A19.

(Note: ellipsis added.)

(Note: the online version of the commentary has the date August 30, 2013.)






HP3D5006CropSmall.jpg


















The StatCounter number above reports the number of "page loads" since the counter was installed late on 2/26/08. Page loads are defined on the site as "The number of times your page has been visited."


View My Stats