No Hope for the Pope

 When Pope Francis was elevated to lead the Catholic Church, I had high hopes for him.  He eschewed the regal trappings of the role, opting for more modest dress and living quarters.  He immediately began to signal that he wished to de-emphasize sexuality as a centerpiece of church doctrine.  He halted the hostile takeover of the Leadership Conference by Women Religious (organization of American nuns) by bishops from the Vatican.  He took steps to clean up the Vatican bank.  These steps were even noted at the Booth School of Business at the University of Chicago in an article by Italian Catholic professor Luigi Zingales, praising his management skills (http://www.chicagobooth.edu/capideas/magazine/winter-2014/is-the-pope-a-good-manager).  As a fairly recent returning Catholic, I viewed a Pope that could turn the Church into a modern institution that understood the realities of the real world as a welcome development that could steer the Church away from the rigid, imperious, hierarchical, doctrinaire church I left so long ago.

The Pope's encyclical on climate change and economics smashed all that.  The Pope could have and should have said we need to be good stewards of the environment and that the wealthy have a moral obligation to find ways to help those less fortunate.  That's it.  But that is NOT what he said.  Instead, he launched into a diatribe against a "perverted economic system" and condemned the "short-term consumerist patterns" and that people allowed technological and economic paradigms to tell us what our values ought to be."  Richer nations should hand over "superfluous wealth" to poorer ones. "Those who possess more resources and economic or political power seem mostly to be concerned with masking the problems or concealing their symptoms,"  he asserts.   As a result of the consumer oriented West, the poor of the world are being exploited and the environment is being turned into "an immense pile of filth".  This view, in essence, is pure Obamunism--the notion that the West has exploited the poorer nations for their labor and resources.  Not content with making statements on helping the poor or taking care of the environment, he launches a frontal attack on capitalism.

The Pope inveighs against our "perverted economic system." What system does the Pope think will be an improvement?  Communism?  Feudalism?  Monarchy?  Military juntas?   We have tried all those.   It is only when capitalism begins to take hold that we see poverty lifted.  One need only look at poverty levels in all of Asia to see what liberalization has done.  All other systems in which the State controlled production have ended in disaster, misery and, often, mass murder.  Is that what the Pope wants?  Does he want to replicate his homeland?  Argentina should be a wealthy country.  Instead, it is a basket case, in constant turmoil and economic crisis caused by its redistributive policies.

Moreover, how are we supposed to transfer "superfluous wealth" to poorer countries?  Who seizes the wealth?  Who decides what is superfluous?  Why is that a better use that using that wealth to invest in companies, people and technologies that have promise?  Are we, in the West, supposed to hand it over to corrupt and authoritarian regimes that have impoverished these people?  Or distribute it directly?  Isn't it better that these people rise up and rid themselves of the thugs that rule them?  Has he not seen that these very regimes are much more devastating to the environment than liberal democracies?

The Pope also took issue with technology and progress.  What part doesn't he like?  The amazing medical breakthroughs that have eased the suffering of so many?  The drugs that have conquered devastating illnesses?  Does he not like the technology that has revolutionized agriculture, permitting us to feed millions more cheaply and on less land and control pests?  Or the advances in methods of distribution that permit us to deliver more and better food to more people more efficiently?  Or does he not like the technology that permits me to respond to my daughter instantaneously even when she is half a continent away?  Or, perhaps it is the technology that developed fracking and permitted the U.S. to move away from coal as an energy source?

He asserts that, "some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world.  This opinion, which has never been confirmed by the facts, expresses a crude and naive trust in the goodness of those wielding economic power and sacralized workings of the  prevailing economic system." As a counterfactual, I offer Robert Lucas's observation that, "the poor in China, i.e., those subsisting on less than $1 a day, look very different today than they did 35 years ago."  Are we to exclude these millions, along with the millions in India and elsewhere in the Far East and now, increasingly in Africa, from the Pope's calculations?   

The Pope's encyclical echoes of Paul Ehrlich's work of 45 years ago (which I have read) and whose predictions were wildly wrong.   The advocates of "limits to growth" rely on extrapolation of data, i.e., "if present trends continue," blah, blah, blah.  But present trends never continue.  Things change. Technologies emerge.  This is the same crowd that talked about a new ice age 40 years ago, "peak oil" (we are now drowning in the stuff), and Ehrlich predicted worldwide mass starvation by the 1980's (actually, we have an obesity problem).

Finally, does he not see that his "limits to growth" position directly contradicts the Church's position on abortion and birth control?  More people, less innovation,  elimination of economic incentives will lead inexorably to something that looks more much more like North Korea or Cuba than the relatively prosperous, educated, healthy, and happy societies we have in the West.

Yes, I am skeptical of the climate change hysteria.  The Pope's encyclical, like Al Gore's book, is riddled with errors and massive errors in logic.  But most insidiously, it is a condemnation of a form of government and economic system that has alleviated more poverty, brought more justice and respect for individuals and individual rights, eased more suffering and has evidenced more respect for the environment than any other.  The Pope has joined in the chorus of people that wish to use climate change to advance their own agenda for a much larger role of government that will ultimately dictate how we should live.

There are many (and I among them) give as much credit Pope John Paul II as Ronald Reagan for the collapse of Communism.  He saw the devastation that system wrought on the human condition, and he rejected it entirely and helped to hasten its downfall.  Francis, in contrast, is using the climate change boogeyman to embrace and promote the redistributive policies of HIS native land, which have sent that country into a tailspin (http://www.economist.com/news/briefing/21596582-one-hundred-years-ago-argentina-was-future-what-went-wrong-century-decline).

The Pope has strayed far afield from his span of knowledge and waded directly into science and economics and has mixed them in a way that has proven itself time and time again to be toxic and deadly to the human condition and has pitched rocks at the system that has by far the best track record of elevating humanity.  I am shocked and dismayed by his hubris and overreach.  I can't help but conclude that he is not much better than the left wing populist politicians that have so ruined the economies of Latin America and South America and is merely pandering to his constituency.

For the second time in my life, I am in a crisis over my religion and am contemplating leaving the Catholic Church.  Several years ago, I answered the "Catholics Come Home" initiative, which attempted to bring back Catholics that had fallen away and attempted earnestly to practice my faith again.  After a promising start, Pope Francis has shaken my relationship with the Catholicism in a significant way.  I will have to think hard about whether I remain with this institution.  If I do, it will certainly be with much less enthusiasm.

No Strategy

It's  now clear to me that President Obama likes to think about the things he likes to think about--mostly redistributive and identity politics and golf, and hopes everything else would just go away.

Ten months after he made the stunning announcement that "we don't have a strategy yet" to deal with ISIS, President Obama this week announced that we STILL don't have a strategy for ISIS.  He carefully laid blame on the Pentagon and on the Iraqi government (whatever that is) for the vacuum, but it is clear that after the fall of Mosul, Ramadi and Palmyra, this administration is completely and frighteningly at sea when it comes to assessing and dealing with foreign threats.  Moreover, we are now sending more men and women into harm's way without a strategy.  Worse, Obama appears not to have any ability to identify the threat or develop a coherent strategy or lead an effort to appropriately confront it.  Our enemies now know this and are acting accordingly.

We are seeing patterns emerge.  Obama consistently refuses to either acknowledge the threat or to correctly identify the enemy or its aims.

Every high school football coach in America knows that you NEVER underestimate your opponent.  In sports and war, upsets happen.  Look at our own Revolutionary War.  Obama consistently downplays our adversaries.  In the '08 election, he sneered that "Iran is just a tiny country and doesn't represent a threat to us the way the Soviet Union did (he has evidently never heard of the EMP (electromagnetic pulse from a single nuclear detonation).  In the 2012 election, he mocked Mitt Romney when Romney raised Russia as a threat, "The 1980's are now calling to ask for their foreign policy back because ...the Cold War's been over for 20 years." Less than two years later, Putin took Crimea and now asserts that he considered using nuclear weapons over it.  And, of course he famously stated that, "If a JV team puts on a Lakers uniform, that doesn't make them Kobe Bryant."
The JV team has been rolling up victories through Iraq, Syria and now has a point of entry into Western Europe through Libya (created by Obama's "leading from behind" initiative).  Reports are now that ISIS has stolen enough nuclear materials to make a dirty bomb.  The JV has evidently made it varsity.

Obama has also misidentified the threat. He has continued, in a cartoonish way, to assert that ISIS is not Islamic.  ISIS begs to differ.  Graeme Wood wrote a masterful article in The Atlantic, "What ISIS Really Wants." (http://www.theatlantic.com/features/archive/2015/02/what-isis-really-wants/384980/).  The punchline is that ISIS IS Islamic.  Failure to comprehend that and ignoring that has had devastating consequences.  Obama's failure to talk about and condemn their atrocities against Christians....BECAUSE THEY ARE CHRISTIANS is both appalling and puzzling because his handpicked UN ambassador Samantha Power's signature work centers around the prevention of genocide, and in her book, The Problem from Hell, the savagery of ISIS falls squarely within the definition and demands forceful action.  Have we even heard a peep from Power?  No.  She has been completely MIA during the rise of ISIS.   Ironically, Obamas rationale for deposing Gaddafi was to prevent genocide.  All he accomplished was to pave the way for ISIS the perpetrate its own and open a conduit to Europe.  We left the Libyan people completely stranded.  The "you break it, you own it" principle has evidently gone the way of the dial phone.  The reality is that Obama's policies are now responsible for more deaths in Libya than the lunatic regime of Muammar Gaddafi.

In the same week that Obama admitted that he had no strategy for ISIS, he unveiled a strategy to diversify wealthy neighborhoods through HUD.  He simply cannot stand the fact that some people live in nicer places than others.  Beheadings of Christians don't really get his blood boiling.  But a gated community?  Intolerable.  THAT he has thought about a lot and has a clear strategy for.

The frightening reality is that Obama has no strategy for ISIS.  But ISIS has a strategy for the West.

Trifecta!

The University of Chicago is a phenomenal place.  I had a once in a lifetime opportunity to attend a presentation of three- count them- three Nobel Laureates in economics this weekend:  Robert Lucas, Jr., Lars Peter Hansen, and James Heckman.  Moreover, I had the opportunity to spend some one-on-one time with Mr. Hansen at the cocktail reception that followed.  It was an amazing experience to have so much real intellectual heft in one room at one time...and an even more marvelous experience to be able to spend some time with Mr. Hansen.

Lucas spoke about the tremendous progress that the world has made since the industrial revolution (chart below), and pointed out that in Adam Smith's time, sustainable economic growth simply did not exist. And over the past 35 years, the per capita GDP of Asia has shifted completely over to the right.  He chided the Left's claim that income equality is THE MAJOR issue of our time.  "If Jeff Bezos has more money than I do, so what?"  The overall progress has been astounding. "We live in a lucky time," he said, "and it's going to get better.  If you really like equality, 1750 was your year," he joked, referring to the universally low per capita GDP.  

Heckman spent most of his presentation debunking the commonly held notion that Europe has more social mobility than the U.S. and showed that the U.S. pays a greater premium for education than European countries.  Denmark, in particular, provides free tuition because it has to.  There is no great economic incentive to pursue higher education.   Absent government transfer payments, there really isn't much difference.  Heckman also argued that the one place that government should spend money is in basic research.  "There is a huge return on that.  There is no return on police pensions."

Lars Peter Hansen talked about his work in risk and uncertainty and the limitation of models.  His slide of Mark Twain's quote that, "Education is the path from cocky ignorance to miserable uncertainty," was a succinct summary of his comments.  "Models are often very wrong," he asserted, and this notion has applicability in the current debate on climate change.

In my private conversation with him, I asked, "You said in your presentation that you had your own thoughts on the macro-economy, but then didn't elaborate.  What are they?"

"We are going to get back to historical growth levels.  Larry Summers is trying to argue that our economic performance is permanently altered and that we are in an era of secular stagnation.  He is trying to make the case for permanent stimulus [i.e. permanently bigger government].  I do not believe that."

After 6 1/2 years of a tepid, halting recovery, I came away with some optimism for the future.  And in any event, it was a tremendous experience to get the thoughts of three truly brilliant, world class minds.

I couldn't help but make the observations that Mr. Hansen won a Nobel Prize for what Yogi Berra recognized a long time ago, "It's hard to make predictions, especially about the future."

The King is Gone

I've been blessed with a wonderful memory.  I can selectively remember vivid and minute details of events decades after they occur.

I have a very clear recollection of watching Don Kirschner's Rock Concert in 1973 in which The Guess Who, Melanie and B.B. King performed.  All of them played so well that I remember that particular show to this day.

Of the three, the performer that enthralled me most was B.B. King with his rendition of "The Thrill is Gone."  That song remains in my top 5 songs of all time list to this day.

As I age, I'm piling up some regrets and the ever expanding bucket list.   Sadly, seeing B.B. King live was on that list and now it's not going to happen.   I made an earnest effort at it over the past few years but each time, a family or work obligation interfered.  Sigh.

I will leave it to others to appropriately eulogize and pay tribute to him and his contributions to the blues, to rock music in general, and to our lives.  But what most inspired me was not only his rise to stardom from being the son of sharecroppers to music legend,  but that he NEVER stopped.  Well into an age where many people have been retired for two decades or more, B.B. King kept up a full touring schedule, only recently slowing down to "only" 100 shows a year.  Sadly, in the last year of his life, he had to cancel some shows and in others, he began to falter.  But until then, he kept rolling, doing what he loved and what God gave him a tremendous gift for doing.

B.B. King, his guitar Lucille and his music left an indelible impression on me.  Rest in
peace.

Train Wreck

Illinois is dying.  People are fleeing the state in droves.  It has lost 300,000 manufacturing jobs over the past 15 years.  The state cannot pay its bills.  Its corruption is a national joke.  4 of the state's last governors have done time.

In the bluest of blue states--the state that gave us Barack Obama--a miracle happened.  The voters elected to dump the status quo and vote for a successful private equity guy to try to straighten out the mess.


I attended a Turnaround Management Association breakfast at which Governor Rauner spoke.  It was a breath of fresh air.  He spoke like a businessperson--focused, energized, and cognizant of the dire task at hand.  He wasted no time laying out the challenge.  Illinois has high sales taxes and the highest property taxes in the country and it is a bureaucracy dying of its own weight.   "The core challenge," he said, "is that the government is run for the insiders' benefit, not the benefit of the taxpayers." The default strategy of "wealthy people paying more is simply not going to happen."

Rauner talked about two fundamental problems.  First is lack of good management talent.  The state is rife with mismanagement, conflicts of interest, and inefficiencies and is especially lacking in IT.  The 800 lb gorilla in the room is its pension, which is enormously underfunded. Unfortunately, the pension had automatic COLAs baked in and a Constitutional provision prohibits the state from changing it except in case of emergency.  Rauner's plan entails maintaining the current pension benefit for current retirees and accrued benefit but to change the plan on a go forward basis for unaccrued benefits, which seems eminently fair and sensible.  However, that will entail a Constitutional amendment that will certainly be fought tooth and nail by the unions.

He evidently is close to Mitch Daniels, who got Indiana out of its mess.  "Living next door to you is like living next to the Simpsons," he joked.  But in other respects, it's not so funny.  Daniels asserted, "Illinois's hostility to business is dragging down the whole region."

Rauner, like a good executive, distilled his turnaround plan into a one page set of easily understandable bullet points.  I left feeling that there was an adult in the room and some hope.

A mere two hours later, the Illinois Supreme Court struck down a law to amend the pension system modestly, claiming it violated the Constitution, stating that "the state must pay" (even though COLAs exceed the inflation rate) and that  "The General Assembly may find itself in crisis, but it is a crisis which other public pension systems managed to avoid and ...it is a crisis for which the General Assembly itself is largely responsible."

Undeterred, Rauner is plowing ahead and will seek a Constitutional amendment and seek to implement a Tier 2 pension plan.  He did not see the law as going far enough.  In the meantime, Illinois is constrained.  Higher taxes will drive more taxpayers out and inhibit businesses from forming or coming to Illinois.

Rauner is seeking to uproot long entrenched symbiotic relationships between the unions and politicians.  Politicians granted fat pay and benefit plans.  Unions elected them and kept electing them.  It was a nice, comfy relationship.

Until we ran out of money.

True Artists

 A little bit ago, I wrote a post that contrasted the films The Imitation Game and Mr. Turner because I was interested in the genius behind their subjects.  Once again, I am compelled to do so, although this time the films are in documentary form.   I recently saw Seymour: an Introduction, an Ethan Hawke film about Seymour Bernstein, a piano teacher who abandoned his ascending playing career to teach piano.  I also saw Finding Vivian Maier (now on rental) about a photographer whose brilliant work was not discovered until after her death.

I was compelled to contrast these two individuals, and both gave me much to contemplate.  These artists had much to say about work, art, and life.  In Bernstein's case, we get to know him first hand through Hawke's interviews and filming of him.  Since Ms. Maier is gone, we get to know her (to the extent we can) through interviews with some of the people that touched her life, mostly the families for whom she worked as a nanny.

Maier was a complete eccentric and I couldn't help but wonder if she suffered from some neurosis that bordered on mental illness.  She apparently never married, did not appear to have any intimate relationships with any man or woman, and lived her life from job to job as a nanny.  She was intensely private, bordering on reclusive and was a hoarder (which got her fired at least once).  And there were hints she was sometimes abusive to her charges.  But she had this gift.   With her Rolleiflex camera, she took street photos, and had this marvelous ability to capture the essence of people.  Holding it at chest high, she captured ordinary individuals close up without the Hawthorne Effect (the phenomenon that subjects change their behavior when they know that they are being observed).   She never exhibited her work and she died alone and largely in obscurity.  While her work is deemed brilliant by many, she appeared to be a very lonely and tortured soul and never quite fitting in.  She seemed to have a passion for this art...and only this art, and worked only to support herself in this endeavor.

Bernstein, a man equally dedicated to his art, presents quite a different picture.  He is a man that seems at peace with himself and his life decisions to eschew performing to teach piano and live a simple life alone in a small apartment in Manhattan.  Seymour: an Introduction is an intimate portrayal of this man dedicated to his craft.  Hawke's film permits us to spend an afternoon with this wonderful human being.  He is easy and gentle and relates well to his students, who clearly revere him.  He is good humored and gentle with his students and at one point jokes with a student that it is against the rules to play better than him.  This film is about mentoring as much as it is the art.  and the message that accomplishment takes talent and enormous amounts of painstaking practice.  

The core of his philosophy was captured in a single, poignant quote: "When I was around the age of 15, I remember that I became aware that when my practicing went well, everything else in life seemed to be harmonized by that. When my practicing didn't go well, I was out of sorts with people, with my parents.  So I concluded that the real essence of who we are resides in our talent, in whatever talent that there is."

The difference between the two subjects is stark.  Spending an afternoon with Bernstein would be a joy, a dinner with Ms. Maier would likely to be awkward and difficult.  Bernstein forsake his career to help young people find their talent.  Maier used caretaking of children to focus on her own art, and indeed, was sometimes abusive to them.

But the two shared a striking similarity in one key respect---the need for solitude.  Vivian Maier's was more of a misanthropic, almost reclusive type.  Bernstein's came more naturally, I think.  But Hawke's film does not delve into Bernstein's relationships at all, so we don't know whether Bernstein was ever married or lived with anyone.  We just know (and he says this explicitly) that solitude was important to him.

Bernstein himself says that "monsters" are capable of having extraordinary talent and ability.   There nasty and incorrigible people that are unbelievably talented and creative.  (See, e.g. Mr. Turner) Clearly, Maier had a dark side.  But Bernstein evidences no such darkness.

But that leaves me with the question of whether true artists need to be solitary, of whether the art takes over so much of their soul that it leaves little room for someone else.   Or whether that time alone is needed for creativity or to synthesize and process the hours of practice and devotion.

In any event, these are both fabulous documentaries with interesting subjects and best seen back-to-back.

Bibi and the Iranian Bomb

When he campaigned for the presidency, Barack Obama promised that he would (a) talk to any dictator without precondition, and (b) take a more multilateral approach to foreign policy than his predecessor.  Faced with the most important foreign policy issue of our time- the Iranian nuclear program- president Obama has shown that he is willing to talk to dictators, but will shut down the voices of our key allies, especially the one ally that has real skin in the game.

The White House threw an absolute hissy fit over Israeli Prime Minister Netanyahu's address before Congress last week and acted as a six year old that sticks his fingers in his ears and hums to drown out every single word.

That Prime Minister Netanyahu isn't in a full fledged panic is a testament to his self restraint.  He is faced with a regime that has vowed on several occasions to "wipe his country off the map," and has repeatedly defied international pressure to halt the means to do so.  Most troubling for him, he has been repeatedly snubbed by this Administration, told he must roll back his borders to the pre-1967 borders, all while asking nothing of substance from the Palestinians.  And now he is being told by President Obama, "Trust me.  I guarantee if it's a deal I've signed off on, it's the best way to prevent Iran from getting a nuclear bomb."

Right.

What does Bibi have to go on to convince him that Obama's assessments are correct and that his negotiating tactics produce satisfactory results?

•  Pushed the "reset button" after Russia's invasion of Georgia and promised "more flexibility" after the 2012 election on nuclear matters. Putin responded by ramping up military modernization and invaded the Ukraine.  Next, the White House dismissed Russia as a "regional power acting out of weakness" in its incursion of the Ukraine.  Today, Russia threatens the Baltics and is carrying out simulated attacks on NATO ships.
  
• Dismissed ISIS as the JV team and declared them not to be Islamic (see link to Atlantic article to the contrary) (http://www.theatlantic.com/features/archive/2015/02/what-isis-really-wants/384980) .  Today, ISIS controls huges swaths of land in the Middle East and is now linking up with Boco Haram in North Africa.   It continues unabated on its orgy of murder and mayhem and is now on a campaign to destroy irreplaceable historical artifacts that are part of the birth of human civilization.

• Labeled Assad a "reformer" before he used chemical weapons on his own people, and did nothing after that self declared red line was crossed. 

• Without asking anything from the Castros, reversed unilaterally and without debate, moved to restore diplomatic ties with Cuba and declared that ""What I know deep in my bones is that when you have done the same thing for 50 years and nothing has changed, you should try something different if you want a different outcome."  Cuba immediately responded by delivering a list of its demands on us.

Worse, in an unstable country (which instability the US facilitated), we demonstrated that we could not even provide adequate security FOR OUR OWN PEOPLE.   Can we blame Bibi for wondering whether an Obama deal with Iran will be adequate to protect HIS people if we will not do what is necessary to protect our own?

Netanyahu raised substantive legitimate issues - leaving infrastructure in place, inadequacy of monitoring and a sunset provision.   Obama, in his response, dismissed the entire speech out of hand and addressed none of these issues.

In yesterday's New York Times, we learned that even the French don't like the terms of this deal.  The French?  The French are advocating a tougher stand?

Yet Obama continues to run after the mullahs like a lovestruck teenage girl.  

In each case---Russia, Cuba, and now Iran, Obama's opening move was a huge concession with no quid pro quo.  With Russia, he scuttled missile defense in Eastern Europe.  With Cuba, he opened diplomatic ties.  With Iran, he loosened sanctions.  All in the hopes that these tyrants would be nice and reasonable.

The results have been predictable....and frightening.

Bibi and the Israeli people should be scared out of their wits.