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President Trump, viewed as a CEO, part 4

President Trump CEO, part 4: Allocating Capital

 

This is part 4 in a series on President Trump viewed through the lens of being a CEO. Part of President Trump’s great appeal is that he’s perceived as a successful businessperson. He’s even been talked about as being a President with CEO experience.

My article on the duties, responsibilities, and job description of a CEO, lays out four inherent parts of a CEO’s job. These are the parts of the job that, by definition, make a CEO a CEO. The CEO can delegate some things, but others simply can’t be delegated. Capital allocation is the CEO’s fourth main duty.

Allocating capital is the ultimate expression of strategic priorities.

Trump manages money

So far Trump has shown that he takes money very seriously. His position on many international bodies and on America’s role in the world is that all countries should help foot the bill for international costs. His stance so far has, indeed, prompted some countries to step up and contribute more to the U.N.

Domestically, Trump has instituted a hiring freeze on the Government and is presumably going to look at spending within the government.

Like everything else, this is more complicated than it seems. Government spending is a huge driver of the economy, and the government is the largest employer in the country. A business certainly wants to lay off as many employees as it possible can and still keep functioning. That’s how we boost profits.

A government, however, is walking a trickier line. A business is generally not affected by the employees it lays off, or by any reduction in its own spending. But not so, a government. Stop spending too quickly and lay too many people off and it simply drives up unemployment and slows down the economy.

Will spending cuts be done wisely?

In companies, spending cuts can be done by declaration: “cut 30% costs across the board.” This is an attractive way to do things. It’s easy to understand and easy to calculate. But it’s a bad way.

This kind of cutting assumes that there’s 30% waste across the board, and it assumes that all cuts are equal. All cuts are not equal. If you consider a company like Microsoft, cutting 30% of their administrative expenses might be a reasonable goal. But cutting 30% of their programming staff would boost their quarterly earnings while probably destroying their ability to fix bugs and develop products to stay competitive.

Spending cuts + process improvement = win?

The fundamental way to reduce costs in an ongoing business is through process improvement, finding ways to do existing things better.

While the stereotype of the Government is that it is extremely wasteful, that is an oversimplification. Some Government programs (e.g. Medicare) are extremely efficient, much moreso than their private counterparts. Other Government programs (e.g. famously, the Defense Department) have huge amounts of waste.

What matters isn’t whether or not the Government runs a program. What matters is whether there are incentives and structures in place that encourage people to work smarter, work better, and improve continuously.

What gets measured gets … measured

George W. Bush was a Harvard MBA who famously was going to bring business principles to the Government. It’s not clear he did much of that. No Child Left Behind introduced measurement into the educational system, but did so in a way that many teachers view as hindering education, not helping it. The Total Quality movement of the 1970s and 1980s showed that simply setting numeric goals without adding process improvements to reach those goals isn’t, in practice, particularly effective.

The business practices that might help the government use its money more efficiently are those of aligning incentives, re-engineering processes, tying employee pay and promotions to customer feedback, and so on. If Trump implements this kind of thinking in the government, it could, indeed, signal a major shift in how efficiently we use our money.

Big allocations reveal priorities

The capital allocation I was referring to in the CEO job duties article weren’t just cost efficiency. The most important capital allocation decisions are the ones that decide which strategic initiatives stay, and which go.

Whether Trump’s spending will be thoughtful or abrupt remains to be seen. He has already declared his intent to increase military spending, while freezing other budgets. He has given directions for us to build a wall between the U.S. and Mexico. He has stated we will increase infrastructure spending, while possibly withdrawing from international bodies (such as the U.N.) to which we pay dues.

The President doesn’t control the budget

Though Trump can control how capital is allocated within the Executive branch, it’s Congress that sets the overall budget (or often doesn’t, in the cases where we’ve had a Democratic President and a Republican-controlled legislature). Trump can fund or defund the efforts to implement programs created by Congress, but there are limits to how much control he has over the national budget.

Summary

At this point, it’s too early to tell how Trump will allocate capital. If his skills match his claims as a successful businessman, he may well find ways to steamline the government and put it on a path to being more efficient. His larger capital allocation decisions remain to be seen, however.

 

Return to Part 1 of President Trump CEO

President Trump, viewed as a CEO, part 3

President Trump CEO, part 3: Setting Culture

 

This is part 3 in a series on President Trump viewed through the lens of being a CEO. Part of President Trump’s great appeal is that he’s perceived as a successful businessperson. He’s even been talked about as being a President with CEO experience.

My article on the duties, responsibilities, and job description of a CEO, lays out four inherent parts of a CEO’s job. These are the parts of the job that, by definition, make a CEO a CEO. The CEO can delegate some things, but others simply can’t be delegated. Setting culture is the CEO’s third main duty.

The CEO sets culture by modeling behavior and by the policies they set. The behavior of a CEO has a profound effect throughout an organization. Behavioral scientist Dan Ariely’s (Dis)Honesty Project shows that when a cultural norm of dishonesty sets in, everyone jumps on board.

One of the things that’s well-documented is the consistency with which Trump lies, even over things as verifiable as Inauguration attendance.

Some people speculate that this will bite Trump, and ultimately discredit him. Others think we will simply normalize to the lies. If so, given Ariely’s research, that could pose a real danger for America as a culture to begin to see lying as a perfectly fine way to interact.

While I was writing this post, Trump forbid all government agencies from talking with the press. This level of government secrecy is unprecedented in a democratic government. Culturally, the message being sent is one of a change to a command-and-control style of governance, rather than a culture of government accountability to the people.

A culture of inclusion…?

The bigger cultural fear is around marginalized groups. Immediately after Donald Trump was elected, there was a spike in hate crimes, which then eased off.

During inauguration weekend, millions of women marched, ostensibly to send a message to President Trump about the importance of woman-friendly policies under his administration. Trump did not acknowledge the marchers, and one of his first acts on his first day in office was to withdraw aid from international health organizations that discuss abortion as an option for family planning. He has also already issued executive orders that appear to be setting the stage for gutting the Affordable Care Act.

Furthermore, his cabinet picks, as well, show the least racial and gender diversity in 30 years. As far as sending a message of inclusively, the message he is sending by demonstration and by his actions does suggest a specific culture, and not one of inclusively.

Summary

The command-and-control messages Trump is sending are very worrisome. They constitute not just a cultural shift from Obama, but a cultural shift for America as a country. A major goal of the Constitution was to create a government with checks and balances that could be accountable to the citizens. While the last several Presidents have moved increasingly in the direction of low transparency and accountability, Trump is taking this so far and so hard in the direction of non-democracy that it’s scary.

In terms of the cultural messages he’s sending on the social and immigration front, he is clearly not trying to send a message that all are welcome in America. With his cabinet picks, the executive orders he has chosen to sign in his first couple of days, and so on, he is sending a clear message that he will act in the interests of only specific groups in his policy-making. People who can’t afford healthcare or education, and women, are already getting the message that they can’t look to the government for help.

 

Part 4 of President Trump CEO, continued…

President Trump, viewed as a CEO, part 2

President Trump CEO, part 2: Leading the Top Team

 

This is part 2 in a series on President Trump viewed through the lens of being a CEO. Part of President Trump’s great appeal is that he’s perceived as a successful businessperson. He’s even been talked about as being a President with CEO experience.

My article on the duties, responsibilities, and job description of a CEO, lays out four inherent parts of a CEO’s job. These are the parts of the job that, by definition, make a CEO a CEO. The CEO can delegate some things, but others simply can’t be delegated. Leading the top team is the CEO’s second main duty.

In the case of the President, the top team means the Cabinet. Most CEOs don’t immediately replace the top team of a company without seeking to understand something about who’s best for the job. Not so, the President. The President replaces the Cabinet immediately.

Hiring

Most people talk about elections as if it’s a middle school popularity contest. “My candidate won! Neener, neener, neener.” “My candidate lost, I hate you forever!!!” Let me be tasteful and diplomatic in saying that this is idiotic beyond belief (trust me, you don’t want to hear the non-diplomatic version).

Elections are a job interview. We may not like the slate of candidates we’re given, but they’re the candidates we have, and we have to choose one to fill the job.

I’ve heard it said that Trump was elected on the “pass it down” theory of competence: he doesn’t have to have great solutions, he just has to put the right people in place who have solutions.

Has he done that?

From his Cabinet picks, I don’t believe so. When hiring for a job, you generally look for relevant past experience, or a highly transferable skill set (e.g. general management).

A Cabinet pick oversees a multibillion-dollar organization. Not necessarily a business, an organization. Governmental bottom lines aren’t measured in dollars, but in civic terms.

Several appointees don’t necessarily know the playing field of the post they’ve been appointed to. That means that if they can get up to speed in any meaningful way, they have the same learning curve as someone just entering the field. I’m not sure that hiring candidates with the equivalent experience of a new college grad is the way to go.

In short, viewed solely through the lens of hiring the right person for the right job, it appears to me that Trump is not doing a good job.

Leading the team

Once he’s hired the team, he has to lead them. It’s too early to tell how he’ll do in that regard. Stay tuned.

Summary

Trump has appointed a top team whose qualifications for their specific roles are seriously in doubts. Many of his picks have no background in the areas they’ve been chosen to lead, no established reputations and connections in those areas, and no evidence in their backgrounds that they’ve managed similar efforts.

If I were an investor in a company whose CEO had just made these picks for leaders of the company, I would sell my stock.

UPDATE Jan 27, 2017: The entire senior administrative staff of the State Department just resigned. Good CEOs put proper succession planning in place for themselves, and understand the need for orderly transitions to keep things from spiraling out of control. Most institutional memory resides in the employees, not in the policies and procedures manuals. I’m extremely puzzled as to why Trump would allow something like this to happen, and not work harder to keep his senior team. This is a troublesome development, to say the least.

 

Part 3 of President Trump CEO, continued…

President Trump, viewed as a CEO, part 1

President Trump CEO, part 1: Setting Strategy

 

Part of President Trump’s great appeal is that he’s perceived as a successful businessperson. He’s even been talked about as being a President with CEO experience.

My article on the duties, responsibilities, and job description of a CEO, lays out four inherent parts of a CEO’s job. These are the parts of the job that, by definition, make a CEO a CEO. The CEO can delegate some things, but others simply can’t be delegated. Setting strategy is one of a CEO’s main duties.

Setting strategy

The CEO ultimately sets the strategy for a company. For a company, that means external, competitive strategy (how do we win in the marketplace against competitors) and internal strategy—how do we best use our internal resources in pursuit of success.

Strategic decisions generally have huge implications for a company or country. They involve moving time, effort, and money from one set of goals to another. They usually represent a multi-year commitment, whose effects won’t be seen until substantial investment is made. So strategic decisions are usually given a lot of thought and analysis.

Unlike businesses, countries don’t use economics as the only measuring stick. The goal isn’t to win against the competition. The goal is to provide a safe environment for the life, liberty, and pursuit of happiness of the residents. The outward-looking strategy certainly has economic components (e.g. tariffs, trade agreements, tax treatment of overseas corporations), but it also involves strategy around war and conflict, around global resource allocation, and around solving global problems that require cooperation between nations.

External strategy is complicated for a country

President Trump has made it clear that we will no longer be the world’s policeman, without compensation. That’s taking an economic approach to strategy.

That’s one piece of the puzzle. Unlike in business, however, countries deal in currencies other than money. Global problems affect us whether we want them to or not. China’s coal-fired power plants cause atmospheric pollution whose effects we feel. Power vacuums in the Middle East gave rise to terrorist groups like ISIS (ironically in response to our leaving Iraq too soon).

That’s what foreign policy is all about. It’s how we relate to the world stage vis-a-vis world problems. In America, the buck stops with the President when it comes to foreign policy.

There are a lot more moving parts when it comes to a country’s external strategy. External strategy needs to blend economics, diplomacy, war, foreign aid, and probably other things as well, if we’re to maximize our country’s well-being.

On his first weekday in office, today, he has already pulled out of the Asian-Pacific Trade Pact and the TPP. He is clearly sending strategic signals, that America will be withdrawing from free trade deals, with the hope that it will bring jobs back to America. Whether it does or not remains to be seen.

Between the time I wrote the last paragraph and this one, Trump has also actually given orders to build a wall with Mexico, and has discussed pulling out of NAFTA. The speed of these orders and lack of discussion given to the implications suggest to me that these strategic-level decisions are being made dangerously quickly.

Non-economic issues matter to a country’s external strategy

So far, the non-economic elements of Trump’s strategy are a mixed bag. He’s done some things that have horrified career diplomats, such as hinting that the US will pull out of NATO. That may be a negotiating strategy designed to get other countries to foot their part of the bill (an economic strategy). And at the same time, the rest of the world is looking at the non-economic elements (their own safety) of that statement.

His foreign policy might be brilliant. It might encourage other countries to fall in line behind us. Or it might scare others into shifting alliances and finding ways to need the United States less, which ultimately gives us less power in the world and less influence in world events that may affect us.

If it’s true that Trump is actually being manipulated by Russia, presumably Putin is doing so to the advantage of Russia, and not to the advantage of the U.S. But that’s probably a determination that will have to be made in hindsight.

There is already a motion on the house floor for America to pull out of the United Nations. That’s the kind of move that has huge potential repercussions. Some of those are psychological, but some are quite concrete. If we leave the U.N., and the remaining countries in the U.N. remain and act as a single body, we’ve just given up any sway we had as part of any issues the organization addresses.

I don’t think we can draw any conclusions, yet. He’s pulling a lot of levers very quickly, and we haven’t yet seen how the effects ripple through the world.

What he’s doing on the non-economic dimensions seems scary to me, but … he could be right. What he’s doing is drastic. Strategically? Just as we can’t know what the final benefits of his strategy will be, we also don’t know what unintended consequences such a strategy might have.

Internal strategy

Internal strategy is determining how best to use the resources of the country to increase overall well-being.

This one’s tricky; I don’t understand even a small number of the issues myself. As for national building blocks of well-being, here are some of the ones I am thinking of:

  • a population of 300 million
  • a public school system
  • certain publicly owned natural resources
  • an electrical grid
  • physical infrastructure
  • farmland
  • a market-based economic system
  • financial markets

The question is whether our CEO has any strategy that explores the interdependencies between these things over the next several decades, and whether our CEO has any strategy for how to combine them to help our country succeed.

Maybe he does, maybe he doesn’t. I haven’t been convinced that any President in my lifetime has had much of an overall strategy. They all seem to have fragments of strategies for each area, largely disconnected from one another. Since all of those things influence each other, the one approach we know is probably wrong is to treat them as silos.

From what little I’ve heard Trump say, I don’t think he has any kind of sophisticated strategy for best using our internal resources. This does not make him unusual, however. If any other candidate, or any President I’ve heard in my lifetime, has had such a strategy, they’ve never talked about it in public.

Trump’s appointment of non-scientists to posts which require scientific knowledge (or at least the understanding of what science is and how it works) is worrisome. America’s strength over the last century and a half has come from our technological progress, on which we’ve built our economic and business progress.

We’ve already ceded several important industries to other countries: manufacturing, computer hardware and electronics fabrication, etc. Now’s the time to be doubling down on education and scientific infrastructure that can form the basis for American and world prosperity for the next century. My impression is that Trump is going in exactly the opposite direction.

Summary

Trump is making rapid-fire strategic decisions that have global and local implications for the economy, for the environment, for the future of our national competitiveness, and for our safety. On the surface, his policy decisions seem to be made as a hodge podge of campaign promises, not as part of an integrated strategy that takes into account the multiple dimensions of his actions.

While it’s too early to tell how his strategies will play out, I’m pessimistic. In my experience, big, complex decisions made hastily don’t often lead to success.

 

Part 2 of President Trump CEO, continued…

A Fee, by Any Other Name, is Still … Class Warfare?

How you describe something—the words you use—can dramatically affect perception. That’s the entire principle behind the business concept of “market positioning” as laid out in the seminal book, Positioning by Ries and Trout. Call Government insurance claims adjustors “death panels” and you can get a populace up in arms. As long as you don’t call private insurance claims adjustors the same thing, that framing can easily be used to get people extra-scared about government health care funding, while quietly directing attention far away from the private insurance adjustors who routinely find reasons to refuse or limit claims for necessary procedures.

Today I’ve noticed a business practice that uses a clever description to engage in the purest form of class warfare I’ve ever seen.

Class Warfare Meets Janice

From what I can gather, when people use the phrase “class warfare,” they are referring to one socioeconomic class deliberately targeting another socioeconomic class for purposes of exploitation or taking what they have, ultimately without really doing anything to deserve it.

Let’s think this through. How do you know someone is in financial straits? Well, if they are having trouble making ends meet, and occasionally overdraw their bank balance.

Let’s consider a not-so-hypothetical “Janice,” who uses the same bank as I do. Janice is a house cleaner, who lives month-to-month with barely enough to pay her bills. Janice has a larger-than-expected automatic payment go through her checking account for $350. The bank charges a $35 overdraft fee, plus $5 every three days as a “continuous overdraft fee.” There’s an amount of money Janice is expected to pay back ($350), and the bank has temporarily allowed Janice to use that money. They not only charged a 10% immediate fee, but they are charging a 1.42% fee every three days, and they expect to receive the money back.

IN WHAT UNIVERSE IS THIS NOT A LOAN???

And on an annualized basis, $5/3-days on a $350 balance is $608 per year. $608 interest on a $350 balance is a 174% effective interest rate. If you fold in the $35 initial fee, that brings the interest rate to 184%.

184%. And by calling it a “fee” instead of a “loan,” the bank gets to charge 184% interest.

And note: this is the most reasonable way to model the situation. If Janice had paid the $350 back the next day, she would still have been charged $35 for a 1-day loan, which is an effective interest rate of 3,650%. Yes, you read that right. By paying back her loan after one day, she was charged 3,650% interest.

These People are Stealing Janice’s Money

Who gets that money? The rich people who own the bank.

If this isn’t the purest, most exploitive, outrageously usurious example of class warfare, in which the rich target those who are explicitly out of money and charge them fees that make Mafia loan sharks look like amateurs by comparison, I really don’t know what is.

So what’s the solution? Well, other than a return to the early 1980s, where banks paid interest and didn’t charge fees, and when overdraft fees were more like 18%/year at the most, I don’t know. Apparently that scenario is considered to disastrous and horrible to contemplate (at least by the banks).

Maybe it’s time to nationalize the banks. Please. Because private banks are destroying America. I’m sure my conservative friends will have all kinds of reason why this is a bad idea. They will shriek and tear their hair out because I am suggesting something that is so UNFAIR and SOCIALIST. But then, having enough money so they don’t get overdrawn, they are never routinely charged 36,000% interest on their overdraft loans. Instead, they scream bloody murder at the thought of having their top marginal tax rate increased by 2-3%, because that’s so horribly crippling that no sane $150K/year person should have to bear that unspeakable horror. And as for Janice and her 184% bank loan, well, that’s just the penalty she pays for the crime of being poor. I agree there’s crime being committed to here—not legally, but morally and ethically—and it sure isn’t coming from Janice.

CORRECTION In the first revision of this article, I erroneously wrote that the $5 “continuous overdraft” fee was weekly, and Janice’s effective interest rate for a yearlong overdraft was 74%. Further reading of the bank’s fee schedule reveals that it is every 3 days, not weekly, thus bringing the interest rate to 174%.

Betrayal of Users. Market forces just don’t work.

Chuckle. I deleted WHISPER because it was vapid beyond all belief, and not particularly interesting. It turns out that the stuff people say if they’re anonymous is droll, predictable, and mainly drivel. Except … it turns out that Whisper was tracking people after all, even the people who had asked not to be tracked. I think this is hilarious! To those who think “the market’ will eventually take care of our privacy, this is yet another example of … NOT!

Read the Guardian article about the little violation of user privacy Whisper engaged in:

http://www.theguardian.com/us-news/2014/oct/23/10-questions-whisper-senate-hearing-privacy

Many of my friends believe there’s this invisible thing called “the market” that will magically provide us what we need to be safe as a society. I just don’t buy it. “The market” encourages all businesses to exploit every possible opportunity for profit, including those that are ethically gray or downright evil, as long as they’re legal. Whisper, it seems, is no exception.

Income inequality is simple math

Simple math is a great way to understand a system’s behavior. I picked up this trick from Warren Buffett’s writing and speaking. Warren often figures out which mathematical elements drive behavior of a stock or industry, and then uses that to set a boundary on his investment decisions. He gave a great analysis in February 2000 of why the first internet bubble had to pop. Three weeks later, it did.

His analysis depended entirely on noting that valuations in the internet companies were assuming profit growth of 15%, while the economy as a whole was growing at 2.5%, and profits were remaining a constant share of the economy. As he put it, “mathematically, that relationship can not continue to hold. I don’t know what will collapse, I don’t know who the survivors will be—and there will be many of them—but I do know that eventually the house of cards will tumble. It has to.”

The Simple Math of Wealth Inequality

Thomas Pitteky’s new book about income inequality is apparently making a big splash. I haven’t read it, yet, but I’ve been told he is very sympathetic to my point of view. Here’s my analysis, before reading the book.

I’ve long held that the driver of wealth inequality is much simpler than policy, philosophy, or ideology. It’s simple mathematical fact, given our tax rates.

I finally ran some numbers.

Starting position: rich own 25%, everyone else, 75%
Overall tax rate on everyone else, 39% (25% federal + 14% FICA)
Overall tax rate on the Rich, 17% (mainly capital gains)
Assuming the Rich can get an average ROI of 15%, while everyone else 10%
(a reasonable assumption, given that the entire class of high risk/high return investments requires one to be an accredited investor. I.e., rich.)

With these assumptions, in 50 years (say, 1960 to 2010), the income distribution goes from rich 25%, everyone else 75% to rich 85%, everyone else 14%.

If we assume that both groups get equal returns on their money, rather than the rich getting higher returns, we still go from 25/75 to 48/51 in just 50 years

The Rich Get Richer, Purely By Virtue of Ownership

As long as the overall tax rate on the rich is lower than the overall tax rate on the poor, even independent of the range of investment opportunities available (and the rich also have enough money to have a portfolio of large-enough bets that a single winner will ultra-increase their net worth), the rich will eventually own everything.

This is independent of whether they work harder, whether they are more committed, whether they “create jobs,” or anything else. It’s purely based on their after-tax rates of return. (And as for them being job creators, note that to the extent that they can lay people off, their rates of return will increase. Hiring decreases it.)

I don’t understand why this simple mathematical fact never comes up in these discussions.

Even If The Rich Allocate Capital Poorly, They Still Win

If you run the numbers, it doesn’t matter if the rich get below-market returns. Berkshire Hathaway, Warren Buffett’s company, has only gotten market-level returns in recent years. But he’s still owning more of the economy than you are, every year.

The tax rate differential is high enough that Warren Buffett’s interest income still has a better after-tax return than you have on your entire income.

Good businesspeople oppose free markets

A friend on Facebook posted an article about New Jersey outlawing Tesla’s direct-to-consumer car sales. My friend was decrying how Gov. Christie is being anti-free-market. And I agree 100%.

From what I’ve been able to see, it’s pretty clear that the big conservative political donors hate free markets. What they love is whatever give them, personally, the ability to get more wealth. By “free market” they mean “don’t do anything that interferes with my personal ability to make money.” For example, the Koch brothers compete by using their money to alter laws so they win. They don’t compete by being better businessmen.

When it comes to competition, they hate it and undermine it at every opportunity, unless they’re the winner.

When it comes to level playing fields (supposedly the bedrock of markets), they hate it.

When it comes to producing the best product at the lowest cost, they hate it.

When it comes to contributing to the infrastructure they use freely that was funded by the public, they hate it.

Business People Should Loathe Competition

It’s a real education to go to business school and ask: how much of this education is devoted to finding ways to gain a market advantage without actually having to do a better job? The answer: most of it. It’s called “business strategy.” We teach our students how to be anti-competitive and anti-free-market, all in the name of free markets.

This works, however. It works because with the right playing field, pitting anti-free-market forces against each other results in more efficient companies through market selection of companies that are fundamentally better than other companies. This produces better ultimate outcomes for the consumers and society who created the markets to begin with.

But never miss the critical point: free markets work because the players are all trying to gain market advantage by doing a better job than each other. The players themselves are not striving to have a fair market, they’re striving to win and eliminate the competition (and thus the market).

It’s the job of government to make sure the playing field is level enough to keep enough market participants that the market continues to function. Players all want monopoly, government wants thriving market participation.

Mr. Christie’s error is that he’s acting as a businessman. That’s not his job. His job is to take care of all his constituents overall, not just the business ones.

Internet: mass manipulation tool?

I’m downloading Trust Me, I’m Lying by Ryan Holiday, about media manipulation on the internet, at the recommendation of a professional journalist friend.

As I read a few of Ryan’s blog articles and PR interviews from the book, I’m struck by how much his experience matches mine. Though I’ve not tried the kind of conscious manipulation he describes, I’ve seen it all over the place and noticed the same lack of basic fact checking in various stories I’ve been involved in.

My most striking example of this was several years ago when a Fortune 500 company revealed to me how easy it is for them to engage in mass manipulation now that the blogosphere lets them leak stories from different sources and have it all build to appear to be a preponderance of independent evidence.

Another Ryan, the amazing and awesome Ryan Allis (founder of iContact, uber-optimist, and serial entrepreneur) and I spoke about this over dinner a few weeks ago. His view is that the internet has evolved to the point where the truth will come out, despite attempts at manipulation. Especially with the rise of social media, manipulation doesn’t stand a chance because the truth will get out via informal networks.

What do you think?

Gun control? Yes.

(Warning: This is long. And I’m sure I’m going to make myself unpopular with this one.)

I favor gun control. Here’s why: guns kill people. “But wait,” you law abiding gun owners cry, “Guns don’t kill people; people kill people!”

Denial is More than Just a River in Egypt

Part of why I find the pro-gun arguments so unpersuasive is that many times, the person spouting them is in obvious denial. They argue about the need to protect themselves, but they’ve never been attacked, and crime stats show they are much safer now than 20 years ago. They say they need the guns for protection against wild animals. That makes sense for those who live in rural areas, but the logic falls down when they “need” dozens of guns or assault rifles. You can only fire one gun at a time to protect yourself against animals. Then they talk about the second amendment. See below for a discussion of that argument. They also say that “if we outlaw guns, only outlaws will have guns.” I say GOOD! See below for why.

But what don’t they say? They never say:

  • I like to pretend I’m Rambo. The fantasy of killing things gives me a rush.
  • I like the feeling of power over other people that my gun gives me.
  • I like the idea I can kill people who disagree with me.

When you have motives that you aren’t willing to say out loud, that’s a good sign that you know those motives aren’t defensible. And while talk of overthrowing a tyrannical government sounds vaguely noble (never mind that the intention of the 2nd amendment was to fight the British when we used militias to fight), motives of liking power and violence are anything but noble.

The discussion I’m happy to have:

I feel powerless and weak, and I’m irrationally scared of everything around me, despite living in the safest time period in human history. I want to be able to kill things in order to feel powerful and safe.”

Great! Let’s talk about that. We might be able to come up with some solutions. But arguments that try to come up with weak, intellectual-sounding arguments without addressing the powerful emotional argument strike me as a near admission that the real reason is too shameful to be legitimate.

(It’s like drug education classes that refuse to discuss the fact that drugs feel good and help people escape from lives they hate. As long as those two very real facts remain unaddressed, users will keep using.)

Guns Are For Defense

The one argument that sounds most persuasive is:

I feel powerless to defend myself, and in my fantasies, owning a gun keeps me safe.

If it weren’t for the statistical observation that guns around the house for self-defense more often end up used for suicide, accidental killings, or murders in a moment of rage, this would be persuasive. The fact is that owning a gun makes you less safe on average. Yes, there are a few exceptional, rare, non-representative cases where a gun is successfully used for defense, but those are dwarfed by the cases where guns do the wrong thing. In most cases, the fantasy that a gun will keep you safe just doesn’t jive with reality.

Even if guns purchased for defense could magically never be used by accident, it still doesn’t justify the need to stockpile guns or buy assault rifles. The chances you’ll be holed up in your house and need a dozen AK-47s to defend yourself seem pretty small.

“Guns Don’t Kill People?” Not according to statistics.

Actually, violent people with guns kill people. If you remove the people from the equation, the chances of death fall tremendously. If you remove the guns from the equation, the chances of death fall tremendously (the Chinese attacker whose attack mirrored the CT attack was armed only with a knife and didn’t manage to kill anyone).

Most gun deaths occur from law-abiding, gun-owning citizens acting in a moment of passion against friends and family. It’s actually THAT group that we have to watch out for. But why would that be true?

The answer involves a slightly obscure kind of statistics called Bayesian statistics. While only a tiny fraction of law-abiding citizens commit murder, there are so many more law-abiding citizens than criminals (yay!) that that tiny fraction outnumbers the criminals using guns.

Here’s a simple example. Assume there are 500,000 law-abiding citizens with guns, and 1% of them commit murder (accidentally or in a crime of passion). Assume there are 20,000 criminals with guns, and 20% of them commit murder.

The murders from law-abiding citizens are 5,000. The murders from criminals are 4,000.

Total murders: 9,000
Percentage caused by law-abiding gun owners: 5/9 = ~ 56%
Percentage cause by criminals: 4/9 = ~44%
The majority of killings come from the law-abiding citizens.

But What About the 2nd Amendment?

I think Lt. Junior Grade Josh Foot responded best to this one. I’m reposting a letter by him I read on Facebook.

From Lieutenant Junior Grade Josh Foot who is currently serving as an Antisubmarine Warfare Officer on USS John S. McCain, DDG-56, :

“My news feed is flooded with people making all kinds of comments about this school shooting. Many are just expressions of sympathy, but there are a lot that fall into one of two other categories, both of which I initially tried to just ignore. So many people are saying these things, though, that I have to say something in response.

The first is the comment, whether said independently or in response to anyone’s attempt to point out the need for legal change regarding gun laws, that “it’s too soon”, or “it’s poor taste to talk politics right now” and “today is about the victims, we can debate later”. If today is too soon, than when, people? This is the same thing everyone said after Columbine, the same thing people said after Virginia Tech, and the same thing people said after the movie theater. When is it not going to be too soon? How about after the next one? In the interest of protecting the future victims, we need to have this conversation now, and if I was a family member of a victim, I would think I’d want some change affected due to these deaths, so that maybe at least somebody else’s life could be saved by this tragedy, instead of just doing nothing to change things and letting it happen again.

The second comment is the tired old rhetoric that the only thing keeping Americans free from government tyranny is our guns, the argument that somehow it’s the knowledge that the Average Joe out there has a rifle in his garage that keeps congress and the president from turning into evil dictators. The first problem with that is that the Second Amendment was written with the idea of using the people to support and defend the government against outside invasion; that’s why it starts with the militia clause.

The second, bigger problem with that argument is that the Second Amendment was written at a time when there was only a tiny gap between military weapons technology and personal weapons used for hunting. I hate to shatter the illusion, people, but your guns won’t protect you from the government anymore. The United States government has the best tanks ever built, the most powerful precision-guided bombs and missiles, jet fighters, aircraft carriers, attack helicopters, warships that could single-handedly conquer small countries. We live in an age where the government has a monopoly on military weapons technology and an overwhelming advantage in terms of monetary resources. Unlike the 18th century when that gap didn’t exist, if the military might of the US government is ever turned against the people nowadays, your guns wouldn’t protect you from anything.

One poster actually brought up Japanese internment camps in WWII and asked what would have happened if every Japanese-American person had had a gun and stood up to the government. Here’s what would have happened: they would have been labeled as traitors and it would have looked like the government was right to put them away, because it would have appeared that they were fighting for Japan, even though that wasn’t the case. In the end we’d have had a bunch of dead Japanese-Americans.

What keeps us free from tyranny in America is the structure of our government and its continued commitment to that founding ideal of freedom. You can’t have a tyranny without an undue amount of power resting in the hands of a single person or very small, united group. The difficulties encountered over every single issue in the past four years ought to make everybody rest assured that Congress is not a small or united group and the President is in no danger of having too much power. The government’s very design protects us from it; that’s the brilliant move that the founding fathers made to protect us from internal tyranny. The reason they gave us guns was to protect us from an outside invader bringing tyranny to our shores. Now that we have a professional, standing military to do that, guns are making no meaningful contribution to the protection of our freedom.

As a member of that military, willing to give my life if necessary to protect that freedom and protect American lives from the wolves outside the gates, it breaks my heart to see the people inside the gates continually killing each other and doing nothing to stop it, because it’s always “too soon to talk about politics”.

In Summary

In short, I support gun control. I won’t go into details about when I think guns are permissible and useful. Those are details that can be hashed out. But until the pro-gun lobby confronts the facts, it’s hard for me to understand why their opinion should be given much weight (other than because they have lots of money). Guns kill people. Most gun violence is committed by the law-abiding portion of gun owners. Basic, animal, fear-driven urges drive gun ownership as much as (or more than) carefully-considered, data-supported logic. A refusal to discuss those facts shows that someone is arguing from a place of irrational, knee-jerk, emotion-filled, fear-driven responses. And when I think about who we should entrust with guns, irrational, knee-jerk, emotion-filled, fear-driven people are not high on the list.