Defending Derivatives and Responsible Financial Innovation

I'm a big fan of making bets on opening weekend box office grosses - that's the raison d'etre of my other blog, TEQP-HSX. I've used real money on Intrade, although not for a while. So I was very excited about Cantor Exchange, the real-money spin-off of the Hollywood Stock Exchange. Cantor works just like HSX, except that the stocks have a shorter lifespan, and there is real money involved. The securities on Cantor are technically derivatives, and, as such, trading them has to be approved by the Commodities and Futures Trading Commission. A great explanation of the potential benefits from Richard Jaycobs, president of Cantor, can be found here.

Most of the debate around trading in futures based on box-office receipts has revolved around technical questions, such as whether or not such contracts could be manipulated, how they would work, etc. There hasn't been much examination of the philosophical issues. That's what I am going to look into.

The core issue is innovation. Trading in box office receipts represents financial innovation. I'm not surprised that the major studios are opposed to it; this is the same industry that fought the VCR all the way to the Supreme Court. They were worried that machines that gave people the ability to watch movies at home would cut into their revenue; those machines are now a major source of that revenue. I can understand their initial opposition to VCRs - at the time, the idea that videotapes would generate lots of money for the studios seemed absurd. The lesson is that we don't know what the future holds, but that it's a usually a good idea to err on the side of more innovation, rather than less.

There's a saying in the movie business that movies are a great art form, but a terrible business. Consider: every movie is effectively a completely new product, almost a new company. Studios invest millions of dollars in products that can technically last forever, but really have a shelf life of a couple of months. Every product has to be completely different from, and yet very similar to, every other iteration of the product that has come before it.

Movie studios and movie theaters have come up with many different ways to control the chaos and hedge against the uncertainty of this wonderful and maddening business. Studios take out insurance against various kinds of calamity. They look for franchises, so they can make several movies that are fairly similar, and therefore likely to generate predictable returns. They use famous stars and directors who can dependably "open" a movie. They follow trends and jump on bandwagons. They test-market potential audiences. They scour film festivals for undiscovered gems that they can buy cheap, hoping for a hit. Theater chains build multiplexes, so that if one movie is not successful on a given weekend, they have others that are. They charge astronomical amounts for junk food.

All of these trends and business practices represent different instances of innovation, except sequels, which have been around since the Iliad and Odyssey. Each of these also has its downside; stars can be expensive, and many eventually lose their allure for audiences. Many sequels are not as good as the original. Many movies based on books or TV shows are not as good as the property they were based on. Trends burn out. Failure is inevitable with any widespread innovation. But learning from failure is part of what fosters further innovation.

I've read the statement by the MPAA before the CFTC on why they think these derivatives are a bad idea. I don't know whether or not all of the terrible consequences that they predict from trading in box office futures will come true. Nobody knows. That's the beauty of democracy: we experiment, and, if we're wrong, we change.

There is one aspect of this debate of which I am confident: this represents - and I realize that, given the current economic environment, this may sound almost like a contradiction in terms - responsible financial innovation. Our current economic crisis was brought about in large part because of irresponsible financial innovation. But box office derivatives are very different from exotic financial instruments like CDO's. First, CDO's are extremely opaque and obscure - most people had never heard of them before 2008, and even many sophisticated financial professionals have no idea how they work. Box office numbers, on the other hand, are public information; there are few pieces of financial information more widely available to the public. It's also very simple: that's why there are hundreds of thousands of players on HSX. There are some risks, but there are regulatory structures in place to deal with those risks that raise ethical or legal issues. Again, I don't know whether or not those structures will be adequate to address the risks and contain bad behavior. No one knows. What we do know is that those regulations, rules, and institutions can be adjusted and changed. Given the public nature of the information and the simplicity of the securities, I am confident the US government can handle the challenges of regulating these securities. The total value of the market will be a fraction of the market value of a single large company. It will not necessarily be easy to police this market, but it certainly won't be impossible.

At the end of the day, there is only one reliable way to make money in the movie business: make good movies. The problem, of course, is that no one - other than Pixar - has really figured out how to do that on a consistent basis. Some people are better at it than others - those are the ones that get to do it again. The market rewards those who make good movies. A market in box office futures will have the same effect: it will reward people who make and invest in good movies, and it will punish people who make and invest in bad movies. It will also have the opposite effect: it will punish people who bet against good movies, and it will punish people who invest in bad movies.

The movie studios have legitimate concerns, particularly about piracy and market manipulation. But the best defense against both of those is the same: make good movies. Seeing a movie at a movie theater is still a great entertainment value. Actually, I'd like to qualify that: seeing a good movie at a movie theater still is, and always will be, a great entertainment value. Markets in box office derivatives will be vulnerable to rumors. But so are all securities markets. The best defense against rumors is, once again, the same thing. Many, many very successful movies - from Jaws to Titanic and even the remake of The Karate Kid - have suffered from rumor, innuendo, and just bad analysis. The Karate Kid was a remake of an 80's movie at a time when the audience was supposed to be hungry for originality and tiring of remakes. It opened on the same weekend as The A-Team, which was also a remake of an 80's entertainment property. Both movies were predicted to open between $30 and $35 million. The A-Team opened at $26 million. The Karate Kid opened at $56 million. No one - not even the studio - had any idea it was going to do that well. But the optimists (I, unfortunately, was not among them) made a killing. The best way to manipulate this market is to make a good movie.

Trading in box office futures represents responsible financial innovation that rewards people who make and invest in good movies. For that reason, I think they should be approved.

Bloomsday and Bloody Sunday

There are a lot of things going on right now that I am interested in - Obama's speech last night, the Lakers about to crush the Celtics in the NBA Finals, the World Cup, the sort-of failure of The A-Team at the box office. But I noticed an interesting convergence of Irish historical moments today. June 16 is Bloomsday, the day that Ulysses takes place: June 16, 1904. Which is the day that Joyce went on his first date with Nora, his wife.

Tim Rutten, in the LA Times, reminds us of a great line: "History is a nightmare from which I am trying to awake." This is eerily appropos of the second moment in Irish history that is being dealt with - not merely observed - today. The British government released a report about Bloody Sunday, the day in 1972 when British soldiers opened fire on unarmed civilians. That unleashed "the Troubles," the years which saw 3,000 people die in sectarian violence.

This is the nightmare from which we are trying to awake. In America, it is hard for us to comprehend differences between two branches of Christianity as being so violent as to cause thousands of deaths. We have, in a sense, awoken from that nightmare.

We have also awoken from a nightmare that afflicted Joyce, that of censorship. The link above in the title of his masterwork goes to Amazon, where you can buy many different copies of this book, and lots of other books about Joyce. That wasn't always the case: it was initially banned in this country.

Every culture needs something to be good at, something that its people take pride in, something that they are better at than other peoples, other countries. For the Irish, this is literature. Novels, plays, poetry - the Irish are genius at creating art with words. Joyce personified this: what he gave the world was a beautiful but difficult work, a spectacularly gorgeous and challenging ode to his hometown of Dublin. He challenged himself, he challenged his readers, he challenged other artists.

What the British government has done today is to rise to a challenge, one that it imposed on itself: the challenge to live up to its own ideals. The United Kingdom demanded of itself that it hold itself accountable for its own failures. That is an extraordinarily difficult task. It was also extraordinarily necessary.

I'm going to end this post by quoting Ulysses, because I've read it. I've been to Dublin, and even read the first chapter in the tower where it takes place. I'm only going to quote one word, but it's the most famous word in the book, the one everyone who finishes it remembers, because it's the last word:

"Yes."

Mark Kirk: Stupid AND Ironic

Mark Kirk is a Republican Representative from Illinois who is caught up in a minor scandal about lying about his military record. Not a huge deal, except that he's running for Senate, and lying about your military record is the kind of thing that raises questions. It's more an issue of stupidity than out-and-out venality.

The specific issue is whether or not he was recognized as "Intelligence Officer of the Year." He wasn't, but his unit was. Sort of a fine distinction, but also something that anyone who has ever written a resume should get right.

Here's the irony: it's a stupid mistake about being "Intelligence Officer of the Year." So the fact of the scandal kind of repudiates the fact of the award.

The moral of the story is: don't make stupid mistakes about awards that have the word "intelligence" in the name of the award.

Salsa Classes at Hope!

Movies and Criminals

I was watching a collection of Ocean's 11 clips when I realized why I like a particular genre of movies. I like romantic comedies, and within that genre, I really like romantic comedies with a criminal element, like Grosse Pointe Blank, The Thomas Crown Affair, or A Fish Called Wanda.

Watching this video from Ocean's 11, it occurred to me that what criminals and filmmakers have in common is that they both have to be very creative. They both have to think outside the box. At least the kind of criminals played by George Clooney and Brad Pitt have to think like this. Criminals, by definition, are challenging the system, albeit for the wrong reasons. But they also have to pretend to be part of the system. Just like people making movies, criminals have to walk a fine line between fitting in, being like everyone else, and doing something that no one else has thot of. Entrepreneurs are the same way, which is also a reason why I like that class of people, as well.

It's not the most emotionally healthy or morally or politically correct analogy. But it sure is fun.

Star Wars question

I just watched Stars Wars, Episode IV, A New Hope . I was in a Barnes & Noble, and I happened to see the DVD on sale. I realized I don't actually own it, so I figured I should buy it (you can too, on Amazon - Star Wars Episode IV - A New Hope (1977 & 2004 Versions, 2-Disc Widescreen Edition)).

I noticed something that I've never noticed before. They come out of the trash compactor looking a little damp, but they dry off very quickly, and suddenly they don't look like they came out of a trash compactor. Not a big deal, because Luke and Han were wearing those presumably watertight stormtrooper outfits. Chewie is a Wookie, we can't really tell if there's a big difference in how he looks. But even in the first moments out of the trash compactor, Princess Leia looks great, as she always does. Makeup perfect, hair tightly coiled in those buns. At this point, she has been captured by Imperial stormtroopers, tortured and interrogated by Darth Vader, and seen her planet blown up. She has had just about the worst day ever. Yet there are no smudges anywhere on her face, and her perfectly white tunic thingy is still perfectly white. You would think that at the very least she would have been crying, after seeing her all those people die on her planet. But no, no running mascara for the Princess!

Here's my question: Did Princess Leia use the Force to keep herself looking that good, in the midst of all that trouble? Was that her special gift? We know that the Force was strong in her, being the daughter of Darth Vader and the twin sister of Luke. Is this why she never needed a lightsaber?

Also, we never really learn how the Rebel Alliance got the plans to the Death Star. We do, however, know that Princess Leia was involved in stealing those plans. If she could use the Force to keep herself looking great walking out of a trash compactor, did she use it in other ways we don't know about? Wink, wink, nudge nudge. Is this the hidden history of Princess Leia? Is this REALLY why Han comes back to save Luke? Did Leia plant some seeds in his mind before he left the rebel base?

Just curious about that.

Can't Resist This One - "What Is A Philosopher?"

The New York Times introduces a new column/blog/something-or-other today by the name of "The Stone," and apparently it is a forum for philosophical discussion. Way to go, NYT!

The first column asks the question, "What is a philosopher?" Good way to start!

Here's my first take at an answer: a philosopher is someone who realizes how incredibly stupid it is to ask a question like "What is a philosopher?" because there are a million different answers, almost all equally meaningless.

Here's my second take at an answer: a philosopher is someone who can't resist trying to answer the question "What is a philosopher?" because his or her answer might be that one-in-a-million answer that is the most interesting and not entirely meaningless. Not "right," because in philosophy, there is no "right" answer, just more or less interesting ones. An "interesting" answer to a question, at least by philosopher standards, is one that provokes the listener into thinking more about both the question and the answer.

Here's my third take at an answer. This is a paraphrase of a quote from Franklin Roosevelt. He used the world "radical," not philosopher, but it's a fun take on it nonetheless: "A philosopher is someone with both feet planted firmly in the clouds."

Here's my fourth take. This one is rather cynical: A philosopher is someone who is paid to be professionally confused for years at a time.

Here's my fifth take, again rather cynical: A philosopher is someone who is professionally uninterested in making decisions.

Actually, four and five are not great answers, because it is entirely possible that someone could meet either or both of those criteria and not be anything close to a philosopher. But it was fun to write those sentences.

Sixth take. There are limits to questions. There are limits to what can be known merely by thinking. A philosopher is someone who is aware that these limits exist, and may even be vaguely aware of where they are, and completely ignores them.

Here's my final attempt to answer the question "What is a philosopher?": a philosopher is someone who understands this analogy: doing philosophy (not necessarily "studying" philosophy) is like driving a Ferrari: 99 times out of 100, it's either largely pointless, not worth the extra effort/cost, or potentially fatal. But that 1% of the time, there is nothing like it in the world.

Kick-Ass

So I saw Kick-Ass, because I can identify with a geeky high school kid who wants to be cool, as, I am sure, many people can. Also, you have to respect a filmmaker and studio who name their movie "Kick-Ass." That takes a certain amount of chutzpah.

The buzz on this movie has been very good. I am pleased to report that the buzz is deserved. This movie does, in fact, kick ass. There are good movies. There are great movies. Then there are movies which change film. This movie will change film. It will be one of those movies which become part of the cultural consciousness.

There are many movies based on comic books, as this one is (the movie and comic book were developed in tandem). Most of them feature a male superhero. Occasionally there is a female superhero. Never before has there been a superhero who is an 11-year old girl. Kick-Ass is the name of the main character, a superhero created by a teenage boy out of nothing but his own hopes and dreams. And a cheesy wetsuit. Hit Girl is the name of the aforementioned 11-year old girl. Hit Girl is a much better superhero than Kick-Ass. Hit Girl can pretty much wipe the floor with Kick-Ass. Hit Girl, actually, can pretty much wipe the floor with just about anybody.

This is female empowerment unlike anything we've ever seen. She's the purple-haired daughter of Wonder Woman and Morpheus. Thelma and Louise, meet Wolverine. Tommy Lee Jones, Will Smith, call your agents - Men In Black just dropped a notch on the cool list. One thing that gives her an edge in the competition to be an unforgettable figure in the cinematic history of heroes with guns is that she is totally adorable. Sorry, Mr. Eastwood and Mr. Wayne, this is Gloria Steinem's revenge. And Princess Leia's.

But she's an adorable sociopath. She doesn't just take out the bad guys - she takes out a lot of bad guys. Questions have been raised, and will continue to be raised (and are being answered), about whether or not it is appropriate to have someone so young playing a role so violent. She also uses language the actress herself (Chloe Grace Moretz, an instant superstar) can't use in real life (she has said that if she did, she would be "grounded for life"). She isn't just violent and foulmouthed - she's also ruthless and coldblooded. But even when she is reloading her Glocks in midair - damn is that a cool shot - she's still somehow cute. The purple wig is a big help.

She's cute partially because she is just absurdly self-confident. We're talking James Bond-self-confident. Sean Connery James Bond-self-confident. You have a feeling that, if she met Darth Vader in a dark alley, she would take out her own light saber and do the Jedi a big favor.

Iggy Pop probably wasn't this tough at 11. And he's sure as hell never been this focused.

She's this way because she was trained to be a lethal assassin by her father, Big Daddy. Whoever thot up "Take Your Daughter To Work" never expected this. Nicholas Cage, who took his own name from a comic book (his real last name is Coppola; he is the nephew of Francis Ford Coppola, and changed his name to avoid any appearance of nepotism) plays Big Daddy. I am not a big Nicholas Cage fan, paticularly of late. But he's perfect here. Big Daddy has his own costume, strongly reminiscient of Batman, and that deep thirst for revenge so necessary for a great vigilante.

A great vigilante, of course, is nothing without a great villain, and Mark Strong is wonderful as the local godfather. He has a son with a Michael Corleone complex, interested in taking over the family business, despite being still in high school. Also present in this character are shades of James Franco in Spiderman.

But back to the title character. Kick-Ass, aka Dave Lizewski (Aaron Johnson, a Brit with a perfect American accent), does not have Hit Girl's collection of weapons or her years of martial arts training. He isn't even particularly strong. All he has for weapons are a taser and a couple of big sticks. What he does have - besides the obvious delusions of grandeur - is determination. And a high threshold for pain. Another thing he doesn't have - and which every superhero needs - is a girlfriend. This brings up an interesting issue with Hit Girl. She's cute, adorable, and funny - but she's 11. She's not beautiful or gorgeous, because those are adjectives that tend to be attached to females in our society who are at least past puberty. Lyndsy Fonesca, who was also John Cusack's girlfriend in Hot Tub Time Machine, supplies the sex appeal as Dave's friend Katie. Not girlfriend - she thinks he's gay. Tony Stark does not have that problem.

All of this would be meaningless, of course, if it were not a well-directed movie. It's not a well-directed movie. It is an extraordinarily well-directed movie. Just about everything, from the costumes to the cinematography, is stylized just enough to be interesting, but not so much as to be distracting. One reason Hit Girl's violent tendencies are so disturbing is that she goes way over the top, but the rest of the movie feels fairly grounded. It's a very realistic comic book movie. Even the 2 or 3 goombas who are fortunate enough to have some speaking lines before they get whacked don't feel like cliches.

On IMDb, this has a rating of 8.5 out of 10, which puts it at #166 out of the top 250. That would be the top 250 movies of all time. I completely agree with that. It may move up. 165 is Dog Day Afternoon. 167 is Gandhi.

I have my own answer to whether or not it's appropriate for an 11-year old girl to be responsible for a couple of dozen deaths. My answer, unequivocally, is yes. Because if that 11-year old girl can't take on a role involving lots of bullets and blood, then she won't have the opportunity to become an iconic badass on the scale of Samuel L. Jackson in Pulp Fiction (John Travolta was the epitome of cool in Pulp Fiction, but Jackson was the badass). And why shouldn't an 11-year old girl have an opportunity to become an iconic badass? There's a question that's never been asked before in the history of pop culture. Buffy was at least in high school, and it took her several seasons to reach icon status. Hit Girl makes Joan of Arc look like a slacker. That comparison hasn't been made too many times before.

What about preserving the innocence of children? Ah, it's a little too late for that. Harry Potter was 11 the first time he took on Voldemort. Wasting a room full of bad guys may send the wrong message to impressionable young minds about the efficacy of violence as a means of conflict resolution. Might be a little too late for that one, too. Problem-solving, let's remember, does wonders for self-esteem. Hit Girl - and Kick-Ass - solve a lot of very big problems.

Most superheroes have a sidekick. Trinity, let's be honest, is Neo's sidekick. Hit Girl is not Kick-Ass's sidekick. If anything, it's the other way around. She's not even Big Daddy's sidekick. Hit Girl ain't nobody's sidekick.

One of Yoda's great lines is "There is no try. There is do, or do not." Kick-Ass learns that lesson. Hit Girl was born knowing it.

Original Idea Fund Launches Today!

Big excitement in the world of Talented Earthquake Productions today - I am starting a mutual fund on the Hollywood Stock Exchange, and the IPO is today! The Original Idea Fund will invest in movies that are based on an original idea. No sequels, prequels, remakes, or sequels to remakes. Nothing based on a book, play, comic book, musical, news story, or theme park ride. No biopics. No documentaries. Just original ideas.

So no Pirates of the Caribbean, no Ocean's Eleven, no Twilight or Harry Potter. But I will be investing in movies made by people like Kathryn Bigelow, Woody Allen, and Quentin Tarantino. I might be investing in the next Avatar or The Hangover. I will also be investing in StarBonds of actors and actresses who star in these movies, although initially I am planning to limit those to one or two StarBonds per movie.

The Fund will IPO at H$20, as all mutual funds do on HSX, and will delist, or cash out, when it reaches H$100. Looking forward, there is a question that I haven't answered yet. Many mutual funds cash out, and then have another IPO. So there have been six iterations of the New York, New York fund, for example. But, given the nature of this fund, I don't think I could do a sequel!

Trivial question of the Day

President Obama stopped by a bookstore in Iowa today, and bought some books.
This line caught my eye:

Obama pulled out five $20 bills to pay for the two books.

This made me wonder: how does the president get cash? Does the White House have an ATM? Does he call up Tim Geithner and have him send some over? Does he call Ben Bernanke and have him bring some by the next time he's in the neighborhood? Does the Secret Service get it for him? How? Do they go to the bank for him? Wouldn't that mean he would have to give them his ATM card and his PIN?

Just couldn't stop thinking about that.

Health Care Reform passes

The Democrats finally did it, passing health care reform. Props to Nancy Pelosi for bringing it through the House. Props to all the Dems in the House who voted the right way, which was most of them, and enough of them. There are some other procedural votes in the Senate, and then Obama has to sign it. But it's done.

The details of what this bill covers have been examined in excruciating detail in many, many places. Andrew Sullivan rounds up the usual suspects and their reactions. I'm just thrilled that we finally have something - anything - different from the status quo. I don't know whether or not this bill will solve the problems we hope it will. I hope it will. I have a certain amount of faith. For various reasons, I haven't followed the ins and outs of this debate as closely as I could have. I understand the basic outline, the amount of detail has been mind-numbing. I started following politics seriously when all you had to do was read The New York Times and a couple of other sources, and you knew all you had to know. I still haven't learned how to drink from the firehose that is the Internet.

What I do know, or at least what I feel comfortable theorizing about, is that this isn't just about healthcare, as broad as that topic may be. This may be the last great victory in the culture wars that started almost 50 years ago. Liberals have won on almost every issue in those wars: they have won on feminism, civil rights, the environment, abortion, and separation of church and state. They're winning on gay rights. They've essentially lost on gun control, but they're starting to win on crime, after losing for decades. Some would argue that they lost on the very broad issue of capitalism, but I don't think that was really up for debate. As frustrated as liberals are by corporations, only the wackiest have really seriously contemplated any kind of alternative to capitalism.

This is not just a political, legislative, or even cultural victory. This is a philosophical victory, an ideological one. What won tonight was the idea that government can improve the lives of its citizens. That's an idea that has been around for a long time, and there have been many victories on that front along the way. But this may be the ultimate victory for that idea. Which may be one reason Republicans fought this legislation so hard: they knew what was at stake, and they knew how badly they were losing. And now they have lost. Take it away, Mr. President:

Oscars!

It's that time of year! Time for the Oscars! The ceremony is this Sunday (as if you didn't already know). The one bummer this year is that there isn't a lot of drama. Some of the categories are pretty much a lock - Christoph Waltz for Best Supporting Actor for Inglorious Basterds, Mo'nique for Best Supporting Actress for Precious, Jeff Bridges for Best Actor for Crazy Heart. But the two big ones are a fascinating race, particularly since it involves an ex-husband and wife. Will Kathryn Bigelow be the first woman to win Best Director? Or will it be her husband, master craftsman James Cameron? Will they split the big prizes, with her winning Best Director and his movie winning Best Picture? That's my bet, because Avatar is one heck of a movie, and, even if the story is a tad cliched, the movie itself is an incredible visual spectacle, and Cameron does deserve recognition for that. I think he deserves recognition as a producer first, and director second, because I think he pulled off a small miracle producing this movie. I also think he did a very good job directing it, but I do take away a couple of points for the lack of imagination in the script.

The other sort-of controversy, which turned out to not be that much of a controversy, is the fact that there are 10 Best Picture nominees. There was quite the hullabaloo over this when it was announced, with strong opinions on both sides. Some thot it was a brilliant move, others thot it was the height of folly. I was in the middle. Yes, it could dilute the prestige, but it is not unprecedented - there were 10 nominees for several years at the beginning of the awarding of the Oscars, until 1943 - and it could be fun.

The answer turned out to be that it was a good move, largely because there are 10 movies worthy of the distinction of being a "Best Picture" nominee. Some people have issues with various nominations - a friend thinks The Blind Side stole a nomination from another, more worthy picture - but for the most part, each Best Picture nominee has received accolades as a very good movie.

Here's the list:

Avatar

The Blind Side

District 9

An Education

The Hurt Locker

Inglorious Basterds

Precious

A Serious Man

Up

Up in the Air

What's particularly impressive about this list is the diversity. There's something here for everyone, and for just about every demographic. There are two war movies, Inglorious Basterds and The Hurt Locker, but they couldn't be more different. One is a very gritty, realistic movie about Iraq, with a small cast, no stars, and not much plot. The other is a fantasy about WWII, starring Brad Pitt, with a very complicated story and lush cinematography. There are two science fiction movies - Avatar and District 9, but, again, they couldn't be more different. District 9 takes place in a filthy, disgusting ghetto/landfill near Johannesburg, while Avatar takes on the exquisitely beautiful planet of Pandora. There are two adult dramas set in contemporary America, The Blind Side and Up in the Air. One is a sentimental story about a white Christian woman in the South, her family, and her community. The other is a dark comedy about guy who has as few commitments and connections in his life as possible. An Education is about a cute British girl coming of age in the 1960's. A Serious Man is about a Jewish man coming undone in the 1960's. And then, of course, there's Precious, which is yet again different from all the others, and Up, one of the only animated movies ever to be nominated for Best Picture.

What a great crop of movies. Most of these aren't just different from each other - they are different from just about any other movie ever made. How many movies have been made about WWII that rewrote the ending? How many movie stars have made movies while at the peak of their stardom in which they played corporate hatchetmen who specialized in firing people? How many movies have been made about a guy who flies his house to another continent with balloons? And, of course, there's Avatar.

The Oscars this year also demonstrate all kinds of diversity in Hollywood, particularly geographic. There isn't much American about these Oscars. There are only three that take place completely in contemporary America - Precious, The Blind Side and Up in the Air. The Hurt Locker features Americans, but has all of about 5 scenes here, and was shot in Jordan. There are only three that feature American movie stars - Inglorious Basterds, Up in the Air, and The Blind Side. Of those, Brad Pitt was not in very much of Basterds, The Blind Side represents Sandra Bullock's first Oscar nom, and Up in the Air was that rare movie that scored two nominations for Best Supporting Actress. Meryl Streep, quintessential Hollywood royalty, scored a nomination for Best Actress for playing a famous American - Julia Child - who spends the entire movie in France. Morgan Freeman and Matt Damon scored nominations for playing South Africans, in Freeman's case Nelson Mandela. Colin Firth, an Englishman, scored a nomination for playing a gay Englishman, in a movie directed by a gay man, Tom Ford, who made his name working for an Italian fashion house (Gucci). Christopher Plummer, born in Toronto, scored a nomination for playing a Russian, Tolstoy, while Helen Mirren, a Brit, scored a nom for playing his wife. Carey Mulligan, also English, scored a nomination for playing an Englishwoman. Penelope Cruz, who is Spanish, scored a nomination for a movie (Nine) that is sort of a remake of a movie by an Italian (8 1/2). The man who will probably win Best Supporting Actor, Christoph Waltz, is Austrian. Among Best Supporting Actor nominees, Stanley Tucci is American, but he stared in a movie directed by a Kiwi, Peter Jackson, who also produced one of the movies set in South Africa, District 9.

Looking down the list of nominated movies, in Art Direction, we find two 19th century English icons - Sherlock Holmes and Queen Victoria - another movie set in London, The Imaginarium of Dr. Parnassus, and Avatar and Nine again. Among the Cinematography nominees, there is one movie with any scenes at all in America - and that's The Hurt Locker, with about 5 minutes in this country. The others are Avatar (another planet), Harry Potter and the Half-Blood Prince (Britain), The Hurt Locker (shot in Jordan, takes place in Iraq), Basterds again, and The White Ribbon (Germany). Costume Design nominees include Bright Star, about John Keats (there's that 19th century England again), Coco Before Chanel (French), and Parnassus, Nine, and Young Victoria again.

Hollywood both is and is not quintessentially American. It is American because it is physically located here, but it is and is not American because it embodies the great American qualities of freedom, adventure, and embracing the new, without limiting who can experience those to just Americans.

Quote of the Day

"Never."

-Martha Stewart, responding to the question, "When do you turn off your BlackBerry?"

Toyota and Obama

Remember when Toyota was the best car company on the planet? They made great cars, stylish automobiles that worked well, didn't have many problems, and got great gas mileage. It was just a better company than any American car company. When was that? Oh, yeah, a couple of months ago. How long had that idea been firmly planted in America's cultural consciousness? 25, 30 years? Something like that.

Amazing how a narrative can change overnight, isn't it? In a month or so, Toyota has gone from being a great company, one of those uniquely special companies that do almost everything right, to just another company, with its share of dysfunctionality, arrogance, and just plain stupidity.

Remember when Obama's presidency was in trouble? A Republican won a special election in Massachusetts, after a couple of Republicans won gubernatorial races in 2009, and suddenly Republicans had the momentum, and Democrats, particularly Obama, were in trouble.

I am so not worried about Obama. Really, really, really not worried about Obama. Tomorrow is the start of the health care summit. I don't know what's going to happen, but I am starting to get the sense that Obama and the Democrats are going to take advantage of the fact that, you know, they have massive majorities in Congress to pass legislation that they want. Great idea.

Obama is also taking advantage of the fact that, you know, he's president and all, and he has a lot of power to get what he wants through a Congress with both houses held by his party by those massive majorities.

But a couple of the reasons for my optimism about Obama stem from Toyota's current trials and tribulations. First, Toyota's fall from the pedestal reminds us of how fickle media/cultural narratives can be. Toyota isn't a very different company from what it was 3, 4, 5, or even 10 years ago. Most of the problems that have been cropping up have been happening for years. But something clicked, and suddenly the narrative changed. There were some stories about problems with Toyotas and sudden acceleration (the LA Times, to its great credit, was working on this story for months before it hit the rest of the national media). The suddenly there were stories about other problems with Toyotas. Then suddenly there were stories about how Toyota has serious structural problems, or how the management team has its share of incompetence and arrogance. All of those things were true for years. But something changed, and now people are willing to listen to those stories. Comedians crack jokes about Toyota, and politicians call them on the carpet. Someday the narrative will change again, and Toyota will have recovered from these episodes, and come out swinging, or they will be back on top again, or something.

The same thing has happened, and will happen, to Obama. His campaign, election, and inauguration were historical, and very hyped. The letdown was inevitable. The narrative has changed, but it will change again, just like it has for Toyota. The Democrats lost two governor's races, in Virginia and New Jersey. But neither of these were surprising, and neither really points to a national trend for or away from Dems. Virginia is a fairly conservative place, and, in New Jersey, the Democrat incumbent, Jon Corzine, was a former chairman of Goldman Sachs, rather substantial baggage right now. Scott Brown won a special election, but my impression is that Martha Coakley didn't run a great campaign, and Democrats took victory for granted.

There's also a specific reason why Toyota's stretch of bad news has implications for Obama. What's bad for Toyota is good for GM, Ford, and Chrysler. GM and Ford will pick up sales from disillusioned Toyota customers.

More importantly, but less substantive, GM, Ford, and Chrysler's reputations will start to recover. For years many people made a clear national distinction among car companies: American car companies were arrogant and incompetent; they couldn't make cars the way the Japanese companies could. There was, of course, an element of truth to that myth - the Big Three made most of their money on their big trucks, while the Japanese made solid, if not very exciting, small cars and sedans.

One detail that got lost in that mythologizing is that each of the Big Three has at least one iconic car in its stable. GM has the Corvette, Ford has the Mustang and the Lincoln Town Car, and Chrysler has Jeep. Each of those has been around for decades, and each has many, many hardcore, devoted followers.

I don't think the Japanese have some genetic predisposition for making better cars; I think the Big Three had each reached the point of being so bureaucratic that they were not very capable of being particularly innovative, while the Japanese companies were still smaller, more nimble, and more entrepreneurial.

Note my use of the word "were" referring to the Japanese. Toyota clearly has some problems with arrogance and failing to acknowledge voices of dissent.

All of this is significant for Obama, because Obama made the decision to save GM and Chrysler, and spent billions of dollars on doing so. People in Detroit had known for years about the problems afflicting GM: too many brands, too many models, too many dealerships. The problem was that no one at GM had the power to solve the problems. Even the chairmen couldn't close the brands they needed to get rid of, or close the excess dealerships. It took the power of the President of the United States to make that happen.

But Obama did it. He saved GM, and he saved - for now, at least - Chrysler. As Toyota's sales fall with its reputation, the reputation of the Big Three will start to improve. GM still has a lot of issues to deal with, and a lot of detritus to purge from its system. It will take some time for it to close down Pontiac and Saturn, and to sell Hummer and Saab. Those old dealerships will eventually be transformed into new buildings, but that will take time, as well.

Once all of those things happen, however, GM will be a leaner machine. Same with Chrysler. They will start once again making good cars that customers want to buy, and they will start making money. And many, many people will be working at them. Most of those people will be Americans.

And Barack Obama will be able to claim that he saved General Motors and Chrysler, and, with them, hundreds of thousands of American jobs. To say nothing of pride in American manufacturing.

And he will have done it with virtually no Republican help, and in the face of strong opposition from Republicans.

Really, really, really not worried about Obama.

The Hurt Locker

So I saw The Hurt Locker, directed by Kathryn Bigelow, currently frontrunner for Best Director Oscar (her chief competition being her ex-husband, James Cameron, for Avatar). It's about a bomb disposal unit in the Iraq war. That's it. There isn't much plot. These guys defuse bombs. Mostly IEDs lying on the street. They use robots when they can, but sometimes they have to walk right up to the bomb and disarm them. They have special equipment, like an armored suit, but it's still one of the most dangerous jobs in the armed forces, not to mention the world.


It takes place in 2004. That's about all you know about the world outside of this small group of guys. No mention of weapons of mass destruction, George Bush, or even Saddam Hussein. You're up close and personal with them, like they are with each other. They don't know each other before being assigned to watch each other's backs. They have different ways of seeing the world, different levels of appetite for risk. They don't always agree, which means that they occasionally have to challenge each other. They make mistakes, which, in this environment, can be deadly. For each other as well as themselves.


The movie takes no position on the war, just shows it like it is. But that becomes the best possible antiwar message, because you immediately understand how insane this reality is. This is what should be a normal country, with normal people trying to live normal lives. Even under Saddam Hussein, they managed to get on with their lives. Getting up in the morning, eating, drinking, doing their jobs, falling in love, arguing with friends and families. Playing soccer. Enjoying the sunshine. Then we started a war in the middle of it. And we're still fighting that war. They would like to be able to walk across the street, but there might be an IED there. And we're sending young men, almost none of whom speak the language, to fight this war. While these people have no choice but to try to get on with their lives.


The main character is a guy who is really, really good at defusing bombs, William James (Jeremy Renner, who deserves his Oscar nomination for Best Actor). But he's also something of a cowboy who takes some bizarre risks. Which means that he gets things done, but his risks don't always work out.

A war is a perfect frame for mixing the real and the surreal, because we, the audience, don't really know what normal is. What is over the top? I have no idea, because I don't know where the top is. A guy snipping the wires to defuse a bomb at the last second is an action movie cliche. Except that here the guy snippping the wires isn't a British spy wearing a tux, trying to save the world and the woman in a beautiful dress that he's been sleeping with. The guy snipping the wires is an American soldier in camo who is trying to save the lives of a few Iraqis and Americans. There are no beautiful women. This is not a fantasy. There is no escapism.

Bill James knows he's good at his job, but he doesn't know why he does it. He's very grounded in reality, completely aware of what he has to do. But he's also strangely detached from his own survival instincts. He's pragmatic, focused, competent, and professional.

And just a little bit insane.

My vote for Best Director goes to Kathryn Bigelow.

Rootin' for the Saints

I am going to be watching the Super Bowl with a couple of friends in a bar in Pasadena. I've watched the Super Bowl with these friends for the last few years. They're pretty clueless about football, but they like watching the Super Bowl. It's a little odd being the sports expert in the crowd, but it's a good feeling.

I am, along with probably 90% of America, rooting for the Saints. Partially because of Reggie Bush, who is a famous USC grad. But also, of course, for the underdog factor. Bill Plaschke of the LA Times explained this country's desperate need for a Cinderella story:

As our country lurches and heaves through the ankle-deep sand of its economic recovery, it has not helped the national psyche that every time we turn to our national pastimes for assurances that the little guy can still survive, we run smack into Goliath.

The New York Yankees won the World Series. Gee, that was fun. The Lakers won the NBA championship. Loved here, hated everywhere else.

North Carolina won the Final Four. Bear Bryant's old team won the Bowl Championship Series. Jimmie Johnson won his fourth consecutive NASCAR championship. The Connecticut women's basketball team has won 61 consecutive games.

And now Peyton Manning is getting ready to win another Super Bowl?

No thanks. Not now. Please. America needs to believe in the impossible again. America needs another dose of revival.

As a Yankees and Lakers fan, I was thrilled with both of those victories, although my otherwise great sports year was tempered by the dismal failure of USC's football team this year (they went 9-4, which was very sad). But I understand his point.

Of course, the greatest Cinderella story in America right now is playing out in the White House, but I suppose as soon he was inaugurated, Obama stopped being the underdog. Of course, the whole point of the Cinderella story is that she is the one who marries the handsome prince.

Save Poetry From The Professors

Andrew Sullivan points to an interesting blog post about the sorry state of modern poetry. I'm requoting what Sully liked:

The best thing that could happen to poetry is to drive it out of the universities with burning pitch forks. Starve the lavish grants. Strangle them all in a barrel of water.

Couldn't agree more. I studied a fair amount of poetry in college, and still own at least a couple of books of poetry. I can quote some Keats, and thoroughly enjoyed Bright Star. I've written a fair amount myself, and once spent three years working on one poem. But I can't stand most current American poetry. Here's how most poetry sounds to me:

I am a poet (pause, deep breath, sigh)
and you (pause) are who I am thinking of (pause, another sigh)
because (pause)
we are both (pause)
depressed.

Most poetry seems to be written by people who are scared of their own shadows, and are creating a space for themselves to be still, and quiet, and mostly alone. It's very inward-directed, and seems to be written by people who are anxious about even going outside. That's probably too harsh, and I'm sure there are thousands of great counterexamples. But that's what a lot of it sounds like to me. The writer of this blog post believes that the source of the problem is that many poets are comfortably ensconced in universities, and that poetry journals end up publishing poetry written by and for these university-bound folks.

Again, couldn't agree more. Except that I don't think this is anywhere nearly radical enough in its definition of poetry. It limits "poetry" to what is being published in books and journals. I think that's absurd. The English-speaking world has a great tradition of poetry called rock and roll. Consider this line:

"The highway's jammed with broken heroes on a last-chance power drive."

Millions of people have heard that line hundreds of times each. It's from Bruce Springsteen's "Born To Run." It could easily be one of the most overplayed songs in history. But try to think about that image without the context of FM radio. There's a reason it's overplayed - it's a great line for a rock song.

So I don't think the problem with American poetry is that Americans aren't interested in poetry. I think the problem is that a few people who are decent writers have managed to convince the rest of us that it's worthwhile to subsidize them so they can talk to each other about how special they are. And some of those people have convinved themselves that they are the ones who determine what is and is not considered "art."

What this writer fails to realize is that the disconnect and the concern is mostly one-sided. He's worried that Americans don't connect with contemporary poets. But the concern is not reciprocated. Most Americans don't read poetry because it doesn't speak to them - he's right there. But most of them also don't care that contemporary poetry doesn't speak to them. I'm perfectly capable of reading and understanding contemporary American poetry. I've even bought "Best American Poetry" books before. But I don't read contemporary American poetry not only because it doesn't speak to me, but because I don't care about it. Two sides of the same coin, I suppose.

But I'm falling into the same trap - defining "poetry" as what is published by people who call themselves poets, and is published in poetry journals. It's not that I don't care about contemporary poetry. It's that I don't care about a particular brand of poery.

Marianne Moore said it best:

Poetry

I, too, dislike it: there are things that are important beyond
all this fiddle.
Reading it, however, with a perfect contempt for it, one
discovers in
it after all, a place for the genuine.

Cheer Up, Idiot Democrats!

Just about any competitive athlete, particularly any pro athlete, will tell you that one of the most important things in any competition is to not let your opponents rattle you. Never let 'em see you sweat. Stay calm, stay focused.

Democrats would be well advised to keep this in mind these days. I knew there would be some finger-pointing and blaming going around after the loss in Massachusetts, and that's what I saw today. Some blogger actually blamed Obama. There was the usual sniping that Obama isn't liberal enough, he's alienated his base, etc., from the "progressive" camp, vs. the "liberals don't know how to compromise" argument from the "moderate" camp.

Not only is this tired and cliched, it's stupid and counterproductive. Taking yourself too seriously is an occupational hazard of being a political junkie. I know this, because I have this tendency myself. Taking yourself too seriously is also an occupational hazard of being a philosophy major, and I was one of those, too. One of my antidotes to taking myself too seriously is the motto of this blog (it's right under the masthead).

Democrats lost a seat they had every reason to believe was an easy victory. That was stupid. But Democrats still have large majorities in the House and the Senate. Plus they have the presidency.

Exactly one year ago today, a young African American with a weird name achieved what most thot was impossible, and was inaugurated President of the United States of America.

Guess what, Democrats - he's still President.

I have said this many times before, and I'm sure I will say it many times again: I refuse to be afraid of my political opponents. Unless someone has a gun to my head, I'm not afraid of them.

I am particularly not afraid of my political opponents when my party controls the levers of power.

Apart from the question of just making the decision not to be afraid, I have solid evidence why I shouldn't be afraid of my political opponents: my side is winning. Not just with today's majorities, but over the course of history. We have won decisive victories in terms of feminism, civil rights, and the environment. We are slowly winning the battle for gay rights. I could go on.

Anyone who is angry at or disillusioned with Barack Obama has not been listening to Barack Obama, because a central part of his message has always been this: This is going to be hard.

There are no meaningful victories without setbacks. I keep thinking about Mark Sanchez, the quarterback for the Jets. Last year, he was the quarterback for USC. He had a year of eligibility left, but he went pro. Some questioned his move - his coach, Pete Carroll, was famously upset - but this year, Mark Sanchez is one victory away from playing in the Super Bowl. And he's the quarterback of the Jets!

Never let 'em see you sweat. Never let yourself be afraid of your political opponents. But never underestimate them, either. And never, ever forget that you are an American, and that the arc of history bends towards justice.

Suck it up, Democrats.

Obama's Next Message: We Have Taken Responsibility

Josh Marshall has a rush take on what Obama should do in response to the loss of a Democratic senate seat in Massachusetts. As I wrote in my last post, I think one thing Obama should not do is freak out. Take advice from that ultimate guide to adventure, The Hitchhiker's Guide To The Galaxy: Don't Panic. There is a great deal of unfocused rage floating in the country right now, and it needs a target. Obama, as president, makes a very convenient target. I find the Jay Leno-Conan O'Brien disaster instructive. Neither Jay Leno nor Conan O'Brien is responsible for this mess. They were both perfectly happy in their jobs, and both doing well. It was the idiot suits at NBC who spent years messing this up. But Leno and O'Brien are both very public faces, so they get a fair share of the anger, largely because few people know how to yell at Jeff Zucker.

But Obama is not responsible for the mess that this country is in: Republicans are. Obama has, however, accepted responsibility for cleaning it up, and I think that should be his message: "We have taken responsibility." We (Democrats) have taken responsibility for winding down the war in Iraq. We have taken responsibility for winning the war in Afghanistan. We have taken responsibility for stabilizing the financial system. We have taken responsibility for reforming the health care system. We have taken responsibility for taking care of our fellow citizens in this time of tremendous hardship.

Republicans, on the other hand, have done nothing of the kind. They have refused to take any kind of responsibility whatsoever for their failures. They have refused to take any kind of responsibility for the failures of oversight which led to a catastrophic financial system failure. They have refused to take any kind of responsibility for violating basic tenets of the rule of law. They have refused to take any kind of responsibility for blowing up the deficit. They have refused to take any kind of responsibility for exacerbating massive inequality.

But Democrats have taken responsibility for cleaning up the Republicans' mess because Democrats have the guts to do so, while Republicans don't. Not all Republicans: there are many Republicans who are very capable of taking responsibility for cleaning up their own and other people's messes, like my Dad. I always add a caveat about my Dad when slamming Republicans, because Dad is a very enlightened Republican (and he's cleaned up a few of my messes over the years). He's enlightened enough to have voted for Obama.

But many Republicans, like Dick Cheney, are just wimps. They talk tough, but they don't have the guts to make tough decisions. Obama, of course, does have the guts to make tough decisions. Decisions like taking responsibility for other people's mistakes.

This Would Be A Good Time Not To Freak Out

So Scott Brown won the race to replace Ted Kennedy as a senator from Massachusetts. It's a bit odd for me to write that sentence, because I have a cousin named Scott Brown, and he isn't in politics, and lives about as far away from Massachusetts as you can in this country (he lives out here in Southern California). He does have a tough job; he does PR for Chrysler.

I have to admit that I didn't see this one coming, but in this respect, I think I am in good company, that company being pretty much every other Democrat in the country. I wasn't following this race until very recently; again, like all my fellow Dems, I suspect. Also like my fellow Dems, I am going to be looking for an explanation, although I am going to try to avoid any kind of intra-party blaming. I am not going to take sides in a moderate-vs.-progressive flame war.

My take on it is that Democrats took the voters of Massachusetts for granted, and if there is one thing that can be said to be an iron law about politics in a democracy, it is that voters hate being taken for granted. It is said that you should not speak ill of the dead, and, of course, a death is a time to remember mostly good things about a person. But I think Democrats, in all their praise of Kennedy, forgot that he was, besides being a great senator, an alcoholic womanizer who got his Senate seat because of his family. My gut tells me that many people voted for a Republican because they really were desperate for a change. I can understand that. I have had many experiences with feeling suffocated by an overwhelming sense of liberal superiority. I went to an elite East Coast liberal arts college in the 80's - I get why lots of people find liberals often insufferably arrogant.

I've also heard that Martha Coakley ran a terrible campaign and Scott Brown ran a brilliant one. I didn't follow it, but I'm going to accept that as fact. I don't know the minutiae, and I'm not that interested.

What I am interested in is the future, and I think that still looks good for Democrats. They still have a brilliant and charismatic leader; they still have large majorities in both the House and Senate. What they don't have - yet - is a strong record of accomplishment.

Obama has been compared on many occasions to Reagan, and it's instructive to remember how bad Reagan had it in the early 1980's. Inflation, unemployment, and interest rates were all very high. The recession was horrible. There were serious doubts about the future of this country. Reagan, to his credit, beat inflation, high interest rates, and unemployment. He was also, of course, responsible for a horrible deficit and many other ills. I don't know how much credit goes to Reagan for all of that, and how much goes to people like Paul Volcker, who was chairman of the Fed at the time.

I find the comparison with Reagan apt for another reason: Democrats didn't realize it at the time, but they were losing their ideological legitimacy. America was still in the throes of the post-60's era. Liberals were winning most cultural debates - feminism, civil rights, challenging authority, etc. - but they were losing the battle over the role of government in society. Reagan touched a nerve when he told people that government had gotten too big. It took Democrats several lost elections to realize that. I think they went too far in accommodating conservatives in this regard, but they needed to make a correction.

Today, Obama faces the same challenge: conservatism as an ideology has run out of steam, intellectually, politically, and morally. Obama's problem is that he doesn't have a cadre of people articulating the replacement. That will be the subject of my next post.

Quote of the Day

"Before you try to revolutionize my business, I'd like to know that you actually know my business."

-George Clooney, "Up in the Air"

Only In New York - Let The Sun Shine Im

Suddenly I am really, really, really nostalgic for Washington Square Park. I have to admit that this wouldn't happen in LA:

Quote of the Day

"I used to hide the fact that I did not know the difference between net and gross profits. Thankfully, someone explained it."

This doesn't sound like a great quote. I'm sure there are many people who don't know the difference between net and gross. What's odd is who said it: Sir Richard Branson. Yes, that Sir Richard Branson, of the Virgin empire. He said it in response to the question "Have you ever lied at work?" in a questionnaire in the Financial Times. What's ironic here is that he apparently lied at work, but now he's being honest about it. In a worldwide forum, no less. Props to him for being honest about something that any first-year MBA student would be embarrassed to admit.

My second-favorite quote from this interview is "The bottom line," when he is asked "What is your most hated business expression?" The next time someone tells me that profit drives business, I am going to share this with them.

Cautiously Optimistic About Detroit

The Washington Post surveyed residents of Detroit about how they feel about the future of Motown. There's general agreement that the place is in ruins now, but most have not given up completely. Which is good, because I'm from there, and I still have family there (Hi Mom!).

I'm of the opinion that there is a silver lining to the bankruptcy of GM and Chrysler: it clarifies the status of manufacturing in Detroit and places like it. I've been hearing about the decline of American car manufacturing for years. GM has been losing market share for years. Chrysler already flirted with bankruptcy once.

I've also been seeing the Big Three perpetuate delusions about their status, and make strategic decisions that, in retrospect, were just not right. GM and Ford both bought European car companies, and are both now getting rid of them.

Beyond the specifics of what failed - like Saturn - what failed generally was strategic, theoretical thinking that had no connection to the basic raison d'etre of the car business. There is one way to make money in the car business: make good cars that people want to buy. It's like the movie business. There is one way to make money in the movie business: make good movies that people want to watch. What GM, Ford, and Chrysler failed to do was consistently execute on the details.

But now we know that those experiments failed. We have clarity courtesy of President Obama.

Conservatives complain that politicians should not interfere with business decisions. Except that a key part of the problem at GM and Chrysler was politics, specifically, the internal kind. Imagine office politics wherever you work. Now multiply that by 1,000. Or 10,000. That's what office politics are like at the Big Three. Many people have known for years that GM was making too many different models of cars. But each division had its advocates, and even the chairman of GM did not have the power to lay down the law and cut divisions.

The office politics at GM and Chrysler were literally so bad that it took the intervention of the most powerful man in the world, the president of the United States, to cut the Gordian knot.

So now we have clarity about the future of American car manufacturing. It's not dead. I have faith that the Big Three can build good cars. I have faith that they now understand that their experiments have failed. There are lots of people in Detroit who know a lot about designing and selling good cars. Those people will still have good jobs. And there will still be people wielding rivet guns and paint sprayers. Just not as many of them.

What's ironic for me is that there are some people who saw this coming years ago, and one of them is a guy named Bill Clinton. An essential part of Clinton's message was this: The jobs that created a blue collar middle class in the 1950's are going, many of them are gone, and they will not be coming back. So we have to deal with it. This is why he focused on health care reform early in his first term - because he knew that the model of employer-based health care was changing, and not for the better. It's also why he focused on job training and empowering people to go to community colleges for retraining.

It's not clear what is going to replace manufacturing as a source of jobs. But transitions like this one have always been problematic. There have always been winners and losers as industries and companies change.

We don't know where we will go from here. But we know we can't stay where we are.

Quote of the Decade

"Know hope."

-Barack Obama

Too Many Honors Societies

Were you in an "honor society" in high school? I wasn't. I don't remember there being an honor society, although I suppose there was one. It didn't matter, I still got into one of the best liberal arts colleges in the country (Swarthmore). Today, however, they seem to be sprouting like weeds, to the point that some schools are cutting back. Sure, it will good on your college application if you're in five honors societies. But that should also raise questions for any college admissions officer about how seriously you were involved in all five.

But there are other reasons an overabundance of honors societies are a problem: first, they raise unrealistic expectations. Once you're out of college, awards are not handed out like Halloween candy. There are six Nobel prizes awarded each year, for the entire world. When someone wins an Oscar, it means that they were the best in the world in that category that year. Period, end of story. There may be multiple valedictorians in a single high school class, but in the real world, every football team has exactly one starting quarterback at a time, and every company has exactly one CEO. There have been some new awards created for entertainment (I'm still not sure what the "People's Choice Awards" are), and there seem to be lots of "Top Ten" lists, but an Oscar is still an Oscar, an Emmy is still an Emmy, and a Grammy is still a Grammy. The Nobel Prize in Economics is new - it was not part of Alfred Nobel's will. So the Nobels have expanded by one prize in a century. Not much danger of cheapening anything there. There are numerous college bowls, but there is one Rose Bowl, one national championship game, and one Super Bowl.

There are three things that will get you into a good college: 1) being a good student 2) being a responsible citizen 3) being interesting. If you are in five honors societies out of 12 at your school, you may be interesting, or your school's honors societies may have low standards. Or you may be trying too hard to spiff up your college application. But if you made your own prom dress from a pattern in a magazine from the 1950's that you found in the local library, you are interesting. If you're the starting quarterback on a football team that went 8-1, you're a good athlete. But if you're the captain of the brand-new lacrosse team that your school just started, you are interesting.

The big problem with so many honors societies is that they are meaningless as soon as you graduate from high school. I was on the debate team in high school. I was moderately good, but I didn't win any awards. It probably helped me get into college, but I never put it on my resume, and I don't think I've had more than 5 conversations about it since high school. As soon as you get to college, no one cares what you did in high school. And as soon as you graduate, no one cares what you did in college.

I think we confuse cause and effect when we think about elite higher education. We see people like Barack and Michelle Obama, who went to Ivy League colleges, and we think, "If I want to be highly successful, then I have to go to an Ivy League college as well."

Hogwash. It does not hurt to go to one of those colleges. But it is not necessary.

The Obamas got into Columbia, Princeton, and Harvard Law because they are smart, competent, and creative. Those are the same qualities which have made them successful in life. But getting into Columbia and Harvard did not make President Obama smart and competent. He got into them because he was smart and competent. He was smart and competent before he went to Harvard Law, while he was there, and after he left. Going to Harvard Law did not make him smart and competent. It showed the world that he was smart and competent, but there are lots of ways to do that. What you don't hear about are the superstar lawyers who went to places like the University of North Dakota or Arizona State (those are both real-life examples that I know of).

There is one thing that is vastly more important than education for being successul in life, and that is knowing what you want. If you graduate from a small community college, but you're determined to be an editor for sitcoms, you've got a decent chance of making it. But if you graduate with honors from an elite college, but you have no idea what you want to do with your life, you might spend years spinning your wheels. Trust me on this one, I graduated with honors from an elite college, but I had no idea what to do with my life, and I spent years spinning my wheels.

If you are in seven honors societies but you have no record of accomplishment in any of them, you might be just collecting tassels. If you're only in the Latin honor society, but you're the president, and you raised money for a trip for you and other students to travel to Rome to read Latin transcripts at the Vatican, then you are focused and committed, and you know what you want. I knew a guy in college who majored in Latin, one of the least practical degrees imaginable. But he got a job working in the rare manuscripts section of a major library in New York, and he was very happy. If you're on the cheerleading squad, you might be doing it just for fun. But if you're the captain, you practice for three hours a day, you bought videos on cheerleading, and you recruited your friends to join the squad, you're focused.

Most people get basically one job based on where they went to college: their first one. After you get your first job, you get your next one based on how well you did in the first one. I have interviewed for dozens of jobs. No one has ever mentioned the fact that I have a degree from Swarthmore. I got one job because I had a degree in philosophy - the president of the company liked philosophy majors (his father had a PhD from Harvard). But that was also one of the worst jobs I ever had.

Self-esteem does not come from collecting meaningless awards and joining groups just because you can. Self-esteem comes from knowing who you are, knowing what you want to do with your life, knowing what you are good at, getting good at it, and being better at it than other people.