China exports about half a trillion worth of products to the US annually and purchases about 165 billion. China’s manufacturing industry is totally dependent on the US, and so the primary job of the Chinese president has been to keep the US presidents under control and don’t get into a fistfight with his best customer.
He did it with Bush, he did it with Obama, but he is not able to do it with Trump.
The Chinese president has a really bad run of late. His relationship with the US went south, the protests in Hong-Kong erupted with no end in sight, economy stopped growing and the corona virus started in their own Wuhan.
Talk about a bad year!
Adding to it – the US may delist certain Chinese companies from American stock markets unless they allow the auditors to look at their books, as it is the case with other listed companies. Obviously that’s a problem - Alibaba’s Jack Ma was quick to step down and let his successor handle the mess.
With the virus story, it’s clear that the Healthcare system failed us, which is the reason why president Trump cut the funding to WHO (the specific reasons why are documented in a 12 page US government report).
The Healthcare profession was not geared to deal with a pandemic like this.
Should they have been? Well, hell yes, especially after similar scares like this before – SARS in 2002 – 2004 and HIV before that.
The world powers reacted to the virus problem in the way they do best: the US president invoked war powers, which he can do without the consent from congress, because this is what the US is good at – war. Except this time the enemy is not visible.
Russia went into denial, and China rolled out the propaganda machine boasting how they are the greatest country there is. In Europe the Schengen zone collapsed, borders went up and every EU country makes their own decisions now.
This is the end of EU as we know it – it makes sense as a trading block, but not as a political entity, simply because the countries interests differ significantly.
There is a clear trend of people trusting less and less in the mass media coverage of the pandemic. In the UK, a recent Reuters Institute polling found out that only 28% of the people trust consistently in what the media are reporting. The trust in BBC news dropped 20% since 2018 alone.
The problem is, that the media will report some expert’s opinion and once they are broadcasted, there is no going back, like you can’t put tooth paste back inside the tube. Then the politicians have to act on the hype.
Experts know their area, but very little of the next area over, meaning that they don’t have a good understanding of consequences of what they are saying. This is what differentiates them from politicians, a definitely more sophisticated breed.
A politician has to comprehend a spectrum, not just an isolated field. He or she also has different objectives – you need to keep people’s confidence, energy and engagement high, and to achieve this you have to lie sometimes.
Unthinkable for an expert, but - they started the corona virus mess and it is now up to the politicians to clean it up.
As for the title of this essay, dog days refer to the Dog Star, Sirius, and its position in the heavens. In Homer’s Iliad, it’s referring to Sirius as Orion’s dog rising, and it describes the star as being associated with war and disaster.
Not a war for us this time, I think, but a long way to recovery.
This is the Beatles song that I am sure you know, partially sung in French.
“Sont des mots qui vont tres bien ensemble
Tres bien ensemble.”
I don’t have a woman named Michelle, but I like the language and the song a lot. And the way the song is written, every woman could be a Michelle.
I took French lessons extensively in Suisse for quite some time but I was a terrible student. Once I stopped taking them, I started speaking it more and more. I can roll the “rrrr” easily, to the point that you would think I am from Montreal.
I can attend meetings in French now, but I ask questions in English.
Still pretty good, I think.
I could easily mess with people’s heads speaking Polish, like saying “generalnie jest kapitalnie.”
The meetings gravitate around how to get things kind of done, which is also known as OE, operational excellence. Every company has this function now, big time.
You need to switch gears and see it as overall equipment efficiency – but isn’t that in every manager’s job description to begin with, to maximize it?
OK, let’s start at the beginning.
In a school or university the key is not the level of teachers, is the level of students that matters and it goes with the price of admission. You need students who were taught by parents not to act on emotions, but on facts. It is tough as hell, but that’s how you get the best of the best. The teachers just guide them through the thinking process.
One thing for sure, the teaching and political elites are sensitive to criticism and they should be, because they’re mediocre. Things go high wire fast and the incompetence shows.
I give you one example – some months ago the Swiss government decided to tax people with company cars for some more money. Just milking the cow, and with enthusiasm.
Guys and girls – you have a budget surplus anyways, why you’re going after us? What’s in it for you? Leave the people alone, let us spend our money as we see fit.
The sad thing is, the bureaucracy can only function if the structures are the same across the society, otherwise they would go crazy. It is by definition a big equalization program. The school programs and graduation standards are same across the system and this is just the beginning of the problem. The interest rate is the same across the country despite plenty of proof how this doesn’t make any sense, as economies differ from oil to mining to agriculure to high tech. Every one of these sectors has different financing requirements and reacts differently to market moves – they can’t be covered with one rate! It is plain stupid.
The media don’t pick up on any this and I have a theory why. You can’t really hire smart people and ask them to come in front of the camera and say what doesn’t make sense. Impossible to do.
The key is to hire people who don’t comprehend much of what’s going on out there and are convinced of the good job they’re doing just providing bullet news, like about a car accident on the bridge or a cat stuck in the tree, or somebody just bent the windshield wipers on the neighbour’s car.
Then you have the other class of people, the ones who have the drive and are creative. You can see them on a corner of the street looking around in a composed way, but for a good observer they have an engine inside that never stops. They also tend to do some crazy things between being brilliant.
Problem with people like this is that they make mistakes more often than not, but if they hit it good – things happen, it’s called progress and this is how we move forward.
I am one of them.
So, my Michelle? Life is rocky, but we may just make it.
The economy works in cycles, from high spending to merciless cutting despite (mostly) failed attempts by governments to stabilise it (i.e. interest level manipulation).
The leaders consistently make every crisis worse than it could have been, but they like to fly high on catchy phrases – flatten the curve, tax the rich, no child behind left… no wait, that’s the Vatican version – no child left behind.
Talking about income inequality is another one, but we can flip it around and call it outcome inequality, switching the meaning to the level of output.
Then the question becomes – how do we handle this, and all of the sudden the discussion gets real. The idea of Universal Basic Income (UBI), which makes rounds through the media outlets, is no solution to no problem.
No problem because progress of the world is not a problem and never will be, and no solution because this is like giving a person a fish, instead of a fishing rod.
Instead, too much time is devoted to nonsense - the Artificial Intelligence is a buzzword, nothing more than pattern recognition, it is in the category right up there with Blockchain which is in essence just an advanced spreadsheet.
And by now nobody really knows what to do with any of them.
AI will mean anything if it’s a software that writes itself and if you believe we’re anywhere close to that, I have the Eiffel tower to sell to you.
The point is - both get more attention than they’re worth.
There is nothing in the computer world today even remotely approaching creative thinking, which is the key in moving the humanity forward.
What doesn’t get the attention it deserves is the idea of meaningful work, which goes together with being creative and original. Meaningful work requires mental effort, routine doesn’t . Mental effort is harder than physical effort.
As humans, we were never programed for the 9 – 5 working days; that came with the industrial revolution and it is going away.
The information age will reverse the industrial age, and the smart people already started figuring it out and they started to work more and more remotely, on their own schedule, their own time and pace and in their own way. And this is actually how we’re most productive.
Human nature doesn’t change with the speed of technological progress – evolution takes time. As hunters-gatherers we had moments of high performance followed by periods of rest. Think lion’s lifestyle.
As farmers and settlers we became more structured, but it was mostly family driven. What we have now is a new way of working, with four or five levels of management and this is fresh on the time scale of human progress. The important (and attractive) part of it is that it dilutes accountability.
It goes with the size of a company, no question, but they will become smaller as we move on.
The current virus scare that we are going through, will seriously weaken people’s trust in governments and media, but businesses will adjust the ways they operate to a more lean way.
Truly, socialism comes from the heart, we all want to be good, but capitalism comes from the head, and this is how we survive.
I like Nassim Taleb’s take on this – “with my family I am a communist, with most of my friends I am a socialist, at the province state level politics I am a democrat.
At the federal level I am a libertarian.”
Now I am asking myself who am I, sitting here in the sun typing this essay – creative and cynical I think.
There is a lot of Kurt Vonnegut in me, if you know the writer.
Also, I used to do boxing hard, I can hit 200 on my motorcycle and I admit that I did things in life I should have done better.
So on a second thought - replace cynical with real.
A transition from public to private is taking place… is why the future will be very different this time around. The confidence in governments is fading away for a number of good reasons, and it will change the world we live in.
The bond market will go through painful convulsions, which is a big deal.
China is in a free fall, which translates into “take your money and run.” Middle East is in transition, to put it mildly, and then there are some interesting things about Europe. You can never underestimate the Old World, when it comes to making a mess of things.
Northern Europe is flat and well rivered and so countries there can achieve efficiencies and economies of scale. Southern Europe is rugged and lacks rivers and so cannot. The bottom line is that Southern Europe will never be able to compete with Northern Europe economically, just as Northern Europe cannot hope to compete with Southern Europe when it comes to sun, fun, food and flair. (France has a foot in both worlds, which is part of what makes the French so cool.)
The bottom line is that the European union can’t last and the Euro can not either.
However, the thing to understand is that we’re not heading into war, because there is no business in it - nobody wants to occupy the other. All the talks about world war III are nonsense, there are better ways to make money and all the players know it.
But, there are huge differences how the world works from place to place.
In Europe the welfare state is in essence a huge shock absorber, but they’re paying for it with lower living standards.
Or, as in China, the command and control state provides the same function – as long as you play along, you’re left alone.
Once you get to United States, it’s a totally different growth model – the idea here is to optimize the run with no buffers. We will accept short, sharp shock, which will allow the economy to come back without massive amounts of new taxation or state intervention. It is a more difficult method, but it tends to work.
It’s an American thing.
Russia is quiet, and this is not good, the media are not picking up on what’s going on there.
And you know, I have a problem with that – in the communist Eastern Europe years ago, the TV had specialists for each region who would come on and explain the settings as things unfolded. There is nothing like this today, we’ve lost the depth of thinking in understanding the world.
On a lighter note, I rode far North the other day and I was talking to a beautiful gypsy woman while my motorcycle was cooling down in front of a restaurant.
She started the conversation.
“Never take advice from someone wearing a suit and tie,” she said.
“How do you know I am even around people like this?”
She just looked at me.
I put my helmet down and unzipped my jacket. “Now you’re getting into my head, which is a mistake, my head is not a place you want to get into.”
“You know the boss, no?” she ignored what I said.
“I do, and she talks in her sleep.”
She laughed quietly. "Your wife."
“I hope that life will treat you kind,” she said.
“What will happen when they call for you?” she asked sitting comfortably in her light flowing brown dress, the wind moving it as she spoke.
I understood right away what she was saying.
"I never get into a situation without knowing the way out."
She looked at me again.
“They can leave a message at the beep.”
Tom Kubiak is the author of The Traveler