Trust & Value

Focusing on job growth and stemming the tide of deteriorating home values is part of a bigger, overall strategy, that we as individuals (prodding our elected representatives as needed) can help implement. Let’s look at the second installment of this two-part blog.

Trust – Right now, people aren't seeing anything happening other than rich institutions gorging themselves on cheap money. They hear words, see world leaders conferring, but do not see results. They watch as big companies gobble up smaller defaulting ones – clearly consolidating a lot of power and wealth in fewer and fewer fat cats. A stock market (the little baby that doesn't lie about how Americans “feel” about economic security) can't grow if people do not trust the system or the leaders that run it. The markets are screaming that distrust. I've already noted one major component of trust-building: start solving the problem with the people (they're the ones that have to trust).

Consolidation of power into the hands of a few also requires increased regulation as competitive market forces are obviously reduced. Transactions for fee-generating, non-value-creating “moving money around” deals should be either regulated or taxed out of existence. The derivatives/hedge fund marketplace needs to be retooled from the ground up. And the special interests whose campaign contributions – to both sides of the aisle – convinced our state and federal governments’ regulators, legislators and top leaders to look the other way as they championed “selective regulation” (don't kid yourself, this is not “free market” any more than we are becoming “socialist”) have to be reigned in.

Value – President John Kennedy once said, “Ask not what your country can do for you; ask what you can do for your country.” Aside from the obvious spirit of volunteerism that seems to rise in the hearts of Americans in times of crises, there are a whole lot of individual efforts out there that aggregate to make a real difference. When the candidates were blind-sided by a recent debate question, which in my opinion neither answered particularly effectively, what sacrifices they thought Americans should make in the near term, I believe that aside from the obvious – reduce your energy consumption consciously and immediately – there was one more big ask that slipped by.

So much of the wealth in this country came from people packaging and reselling financial instruments, merging, buying and reselling (“flipping”) companies (occasionally making them more efficient, but always generating investment banking and legal fees) or creating transactions for the pure sake of generating financial fee income such that value creators often got left behind in the vacuum of capital. So here’s the biggie, where you and I can make a difference to this mess.

Ask yourself every day, what “value” did I create for my country today – mostly in my work, but maybe in my education or free time activities? It doesn't matter that you are paid for it (but not overpaid for it) or that creating values can make you rich. Rich from creating value is a terrific reward under the American version of “capitalism.” And then ask what value you removed or reduced from the system that day. If we all just add a little bit more than we take out, the aggregation of that effort is called GROWTH, and there isn't a recession that can stop that form of concerted effort. We are Americans; we work hard, come up with great ideas, and are the world’s greatest fountain of innovation. All we have to do to recover is just return to those fundamental American values.

A final word about final words. Putting a simple label on complicated issues tells people how they should feel about something without actually explaining what is going on. In a modern society, some words are almost archaic, rendered meaningless because no society on earth actually embraces anything like the “pure form” of any particular social structure. There really is no pure “socialism” or “free market capitalism.” When people tell you that’s were we are going or that’s what we should become with such labels – run! Instead, just ask yourself what you think you want a society to give you in your daily life (describe the results without the label); skip the simplistic and often emotionally charged label and go to the substance.

I’m Peter Dekom, and I hope someone out there is listening to this message.