zenpundit.com

Senator Chris Dodd (D-Connecticut) is working hard in Washington…. to make sure that only those who are already  Rich and Powerful   will have a shot at being rich and powerful.

From Rick Tumlinson at Huffington Post: 

• Start-ups have to register with the Security Exchange Commission and then wait 4 months minimum for it to review their filing. This is a lifetime in the fast moving world of start-ups. (Keep in mind you and your employees are living hand to mouth everyday there is no money coming in.)
• Accredited investors (those who can legally invest in start-ups) would be limited to those with assets of over2.5 million (up from1 million) or a personal income of450,000 (up from250,000). This knocks mom and dad and uncle Bill right out of the game for most entrepreneurs. How many multi-millionaires in your family and close friends?
• Removing the federal pre-emption which provides a single set of national regulations and forcing companies to deal with state-by-state variations in rules. Most start-ups are kitchen table corporations at first. We have no money to pay lawyers to figure things out for us. That’s why we are looking for funds in the first place. Duh!

This is so egregiously wrongheaded and economically counterproductive on so many levels that it’s hard to know where to begin. Even the big money Obama backers of Silicon Valley are calling this bill “insane” . There’s literally no upside to these provisions which limit the field of potential start-up investors to a professional insider’s club skilled at wheedling favors from the SEC behind closed doors. That may be the objective of these rules. 

You middle-class serfs can get back to the fields now. Creating start-ups and making investments are not for your kind.

Complicit: How Greed and Collusion Made the Credit Crisis Unstoppable by Mark Gilbert

Inside Cyber Warfare: Mapping the Cyber Underworld by Jeffrey Carr

Received courtesy review copies of two books that will serve to “stretch” my knowledge base and increase my cognitive map.

Mark Gilbert is a financial columnist and bureau chief for Bloomberg News in London and he has written a hard hitting deconstruction of the great credit collapse and crisis bail-out of 2008-2009. Gilbert is telling a story of breathtaking risk assumption, regulatory capture, academic hubris, central bankers as naked emperors and unrepentant banksters who have learned nothing and forgotten nothing from the crisis. My personal background in credit issues is rooted solidly in the dustily agrarian economic history of the 19th century and the painful transition from yeoman “book debt” to gold standard dollars, so I look forward to broadening my understanding of modern financial systems from reading Complicit.

I will probably review Complicit in a cross-blog conjunction with Lexington Green, who also has a copy in his possession.

Jeffrey Carr is the CEO of GreyLogic and a researcher, presenter and consultant on issues related to cybersecurity, hacking, cyberterrorism and asymmetric conflicts in virtual domains. Carr offers a cohesive and compact look at the major problems and players in the uncertain crossroads of national security and cyberspace. Non-geeks (like myself) will appreciate Carr’s focus in Inside Cyber Warfare on the connection to the worlds of intelligence, law enforcement, international law and military operations and doctrine. As an added bonus, the foreword is by Lewis Shepherd, another blogfriend and the former Senior Technology Officer of the DIA.

Originally, I had wanted to review Inside Cyber Warfare before last Christmas, so now that I have the book, I will move it to the top of my titanic reading pile.

John Hagel is in a small category of thinkers who manage to routinely be thinking ahead of the curve ( he calls his blog, where he features longer but more infrequent posts than is typical,  Edge Perspectives). I want to draw attention to the core conclusion of his latest:

Challenging Mindsets: From Reverse Innovation to Innovation Blowback

Innovation blowback

Five years ago, John Seely Brown and I wrote an article for the McKinsey Quarterly entitled “Innovation Blowback: Disruptive Management Practices from Asia.” In that article, we described a series of innovations emerging in Asia that were much more fundamental than isolated product or service innovations. We drew attention to a different form of innovation – institutional innovation. In arenas as diverse as motorcycles, apparel, turbine engines and consumer electronics, we detected a much more disruptive form of innovation.

In these very diverse industries, we saw entrepreneurs re-thinking institutional arrangements across very large numbers of enterprises, offering all participants an opportunity to learn faster and innovate more effectively by working together. While Western companies were lured into various forms of financial leverage, these entrepreneurs were developing sophisticated approaches to capability leverage in scalable business networks that could generate not just one product innovation, but an accelerating stream of product and service innovations.

…. Institutional innovation is different – it defines new ways of working together, ways that can scale much more effectively across large numbers of very diverse enterprises. It provides ways to flexibly reconfigure capability while at the same time building long-term trust based relationships that help participants to learn faster. That’s a key breakthrough – arrangements that support scalable trust building, flexibility and learning at the same time. Yet this breakthrough is occurring largely under the radar of most Western executives, prisoners of mindsets that prevent them from seeing these radical changes.

Read the whole thing here.

Hagel is describing a mindset that is decentralized and adaptive with a minimum of barriers to entry that block participation or information flow. One that should be very familiar to readers who are aware of John Boyd’s OODA Loop, the stochastic/stigmergic innovation model of John Robb’s Open Source Warfare, Don Vandergriff’s Adaptive Leadership methodology and so on. It’s a vital paradigm to grasp in order to navigate and thrive in the 21st century.

Western executives (think CEO) may be having difficulty grasping the changes that Hagel describes because they run counter to cultural trends emerging among this generation of transnational elites ( not just big business). Increasingly, formerly quasi-meritocratic and democratic Western elites in their late thirties to early sixties are quietly embracing oligarchic social stratification and use political or institutional power to “lock in” the comparative advantages they currently enjoy by crafting double standards through opaque, unaccountable authorities issuing complex and contradictory regulations, special exemptions and insulating ( isolating) themselves socially and physically from the rest of society. It’s a careerism on steroids reminiscient of the corrupt nomenklatura of the late Soviet period.

As the elite cream off resources and access for themselves they are increasingly cutting off the middle-class from the tools of social mobility and legal equality through policies that drive up barriers to entry and participation in the system. Such a worldview is inherently zero-sum and cannot be expected to notice or value non-zero sum innovations.

In all probability, as an emergent class of rentiers, they fear such innovations when they recognize them. If allowed to solidify their position into a permanent, transnational, governing class, they will take Western society in a terminal downward spiral.

The French equivalent of the Supreme Court reveals the extent to which global warming alarmism was always intended as a justification for a sophisticated tax-farming rip-off of normal people by oligarchical elites:

….The tax, which would have started on Jan. 1, was set at 17 euros ($24.38) per ton of carbon-dioxide emissions, President Nicolas Sarkozy said in September. To make the tax more palatable, he partially or fully exempted power plants, public transport, airlines, farming and fishing, as well as 1,018 older cement, steel and glass factories.

In all, 93 percent of all industrial carbon emissions in France would have avoided paying the full tax, the constitutional court said in a decision published on its Web site. The tax would have fallen disproportionately on fuel for heating and cars, it said.

Emphasis mine. 

Jesus, 93 %? Was anybody with connections paying the tax?  Warmer, colder, who cares?  Just so long as widows, hotel maids and slum dwellers are paying through the nose in carbon taxes while Total S.A. skates! That is to say, the burden is on the ignorant peasantry who did not go to Ecole Nationale d’Administration.

Or on our side of the pond, Harvard.

ADDENDUM:

Science Daily – No Rise of Atmospheric Carbon Dioxide Fraction in Past 160 Years, New Research Finds

Interesting.