Our family has a concept that we call the "flat-forehead moment," which is that moment of realization - usually caused by reading or hearing someone else's idea - that causes you to smack yourself on the forehead with the palm of your hand while exclaiming, "Of course!"

I had a flat-forehead moment yesterday morning.

In yesterday's San Francisco Chronicle (may sweet Jesus rest its troubled soul) there was a letter concerning the current financial scheisse-storm from one George Machun (of whom San Francisco should be proud) which read in part, "Since last week, you've reported that the administration explains these corporations have to be bailed out because they are 'too big to fail' and would cause unimaginable damage to the world economy if they do fail. It would seem to me that if they are too big to fail and can cause that much damage, then they are too big to exist in the first place."

[smack!] Of course!

Case in point: I've come to believe that AIG, the insurance megaspeculator that the Fed rescued last week, actually was too big to be allowed to simply dry up and blow away. Due in no small part to AIG's vast involvement in credit default swaps (CDS), which reached its tentacles deep into the worldwide corporate bond market, the Fed had to act. If it hadn't, and AIG's CDS support to those corporations' positions would have shrunk to essentially zero, the worldwide credit market would have frozen up colder than Rumsfeld's heart - no, even worse: colder and tighter than Cheney's damaged plasma-pumper.

And that would have been a bad thing. Business investments, materials purchases, job creation, and facilities expansion would have snapped shut, tighter than ... well ... the spiked iron door to the aforementioned Dick's secret undisclosed location. AIG had maneuvered itself into a position where it was, indeed, too big to be allowed to fail.

Fannie and Freddie? Also too big to fail (TBTF). The entire U.S. financial system? The mother of all TBTFs.

The problem is that companies are getting bigger all the time. Think Exxon-Mobil, Disney/Capital Cities/ABC, Clear Channel, Google, Bank of America - and note that all three words in BofA's name are linked to separate multi-billion-dollar acquisitions. (Mr. Sherman has apparently left the building.)

Out of that list, Exxon-Mobil and Bank of America are certainly TBTF - and seeing as how the administration has carried water for broadcasting in the current digital-television voucher program, I wouldn't put it past them to prop up Disney/Capital Cities/ABC or Clear Channel, as well. And let's not even talk about Fox.

Yes, better oversight and tighter regulatory reins would help keep companies - especially financial-services companies - from reaching into our pockets when they overextend themselves, but I have a less-modest proposal: Stop companies from getting so big that if they fail, we pay.

It'd be the end of TBTF as we know it.

This could be done in either of two basic ways (each, of course, with a myriad variations): Either simply put a cap on the value of all of a company's operations, or create a corporate tax code that severely taxed earnings above a certain cap - and I do mean severely; something in the 95%-plus range. Global corporations would, of course, offer their own set of challenges, but this idea is only one day old - give me a chance to think it through.

And sure, there'd be inefficiencies in economics of scale that would be passed down to consumers in the former of higher costs and prices, but the general public would benefit not only by not becoming saddled by dept when a TBTF company tanks, but also by the fact that without the aforementioned economies of scale that occur after two companies become one, employment would rise.

More and smaller companies would mean increased competition, the necessity for more competitive innovation, lowered executive salaries, reduced shipping costs and carbon emissions due to more-local production, better corporate responsiveness to shareholders, less corporate control over government, and many other bennies.

This idea is so simple, so straightforward, and so attractive that there's gotta be something wrong with it - other than the fact, of course, that no one in Washington would survive for a nanosecond if he or she suggested it.

Can you tell me what I may have missed? [back to top]

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I'm certainly not one to mistrust the honesty and integrity of the Bush administration. After all, when have they ever used exaggeration to justify risky actions or push through legislation that might be construed by some American traitors as "suboptimal?"

But have you actually read the Paulson/Bernanke/Bush bailout plan?

Let me quote you just two nuggets from that proposal, and then you tell me whether Congress is right to say, "Hold on a moment!"

• "The Secretary is authorized to take such actions as the Secretary deems necessary to carry out the authorities in this Act, including, without limitation ... entering into contracts ... without regard to any other provision of law regarding public contracts."

• "Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency."

New frontiers in cojonitude.

The first of these two examples tosses aside any remaining scraps of financial-services contract regulation. Isn't a lack of regulation one of the major reasons that we got into this mess in the first place?

Well, yes, but it's not the only reason. Check out the second example, which removes any review or oversight from the disposition of the $700 billion bailout fund. A lack of review and transparency in financial dealings is an equally important reason for the current financial meltdown.

The proposal is a tasty twofer of Treasury terpsichorea: No regulation. No review.

Equally astonishing is the brevity of the proposal: a mere 840 words that run roughshod over any matters of complexity, subtlety, and balance.

Hmm... At $700 billion, that works out to $833,333,333.33 per word.

Now that's a freelancing pay rate I could really get behind!

6:46 PM 9/24/08 - Reader Jeff Carlock points out that in a piece on Forbes.com today, this mind-boggling bit of information emerged:

"In fact, some of the most basic details, including the $700 billion figure Treasury would use to buy up bad debt, are fuzzy. 'It's not based on any particular data point,' a Treasury spokeswoman told Forbes.com Tuesday. 'We just wanted to choose a really large number.'"

To quote the astute reaction of the authors of that Forbes.com piece to that Treasury spokeswoman's statement, "Wow." [back to top]

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Y'know, being a successful freelance writer has its perks, but there's also the big ol' downside that's called ... well ... working too much.

C'est la vie of the home-office boy.

In any case, I've been spending what little free time I have studying the the recent financial meltdown and trying to divine whether we taxpaying folks do indeed need to bail out our reckless financial "leadership class" to the tune of $700 billion. Maybe so - doing so just might be necessary to keep the wolf from the door. Or it just might be a way for the monied classes to keep themselves ... well ... monied. (Or should that be "well-monied?")

I'm not convinced either way, but I'm leaning towards the depressing conclusion that we may simply be screwed. Our financial overlords have been indulging themselves in naked short-selling (short-selling without actually holding - or delivering - the stocks you claim to be selling), unregulated and undercapitalized credit default swaps, and other shenanigans - and we didn't stop them. We didn't force our trough-fattened politicians to regulate them. We didn't do our electoral duty, and we're now caught by the proverbial short hairs.

In the high-stakes game of big-money finance and governmental influence-peddling, we lost.

So now, in the tried-and-true American tradition of privatizing profit and socializing loss, we're being asked to bail the finance folks out to the tune of $700 billion. At minimum. With little or no oversight. By the same team that got us into this mess. And, of course, according to Ben Bernanke and Hank "Take It to the Bank" Paulson, this bailout must come immediately, if not sooner. Otherwise, as we are being warned by an administration that believes strongly in fear as a prime motivator, America As We Know It™ will cease to exist.

When must we give them this blank check? Right! Now! Which brings me to the shallow humor that inspired this post.

Back in January of 1973, the National Lampoon published a cover that has become famous in the publishing industry as one of the most successful eye-catchers of all time - I've included it above. Bernanke's insistence that the bailout of the financial system must be done instantly, without debate, without input from Congress, and without oversight reminded me of that cover. I include an updated version, below.

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This entry comes in four parts: two bits of information, a touch of analysis, and a request for help.

INFORMATION #1
Last Saturday afternoon I was in our kitchen, listening to a podcast of Harry Shearer's Le Show (highly recommended), when my iPhone rang. Knowing from the ringtone that it was my daughter Rox calling, I used the IR remote of our cheap-but-serviceable iStation7 iPod-docking speakers to pause Harry's ruminations on Sarah Barracuda, then flipped open my smartphone's case and dragged my finger across the iPhone's multi-touch screen (which displayed a fetching digital photo of the Lovely and Talented Roxanne Myslewski™) to answer the call.

Rox - after her usual nanosecond-long "Hi Daddy!" greeting - told me she was driving in downtown Tacoma (Rox is a senior at the University of Puget Sound), and that she needed directions to an event that she and her main squeeze wanted to attend. Could I please look up that information for her on the Web?

No problem. I could have put her on hold and looked up that info on my iPhone over Wi-Fi or the 3G cellular network, but I instead walked into my wife's office, sat down in front of her 24-inch iMac (a 2.8GHz Intel Core 2 Duo with 2GB of RAM and a 300GB drive), launched Safari, navigated to maps.google.com over Gigabit Ethernet to our ISP using our DSL modem, and entered Rox's current and desired addresses.

When the best route to her destination appeared (which took almost no time, since we're on high-speed broadband here at Chez Polonaise), I first checked how bad the traffic was on that route. Since it was okay, I gave Rox the turn-by turn directions; she thanked me and said g'bye. Then - just for, as they say, the halibut - I used Google Maps' street-view capability to spy on what kind of place Rox was going to.

Always a dad, y'know?

All was well, so I went back to work in the kitchen to prepare a shabu-shabu dinner for a dear visiting friend.

INFORMATION #2
I recently picked up a fun freelance gig from Macworld magazine. Y'see, Apple's Macintosh is about to turn 25 years old this upcoming January, and an event like that can't pass unheralded. They want me to write about it.

My editor, though, wisely thinks that yet another slog through the history of the Mac isn't enough. The consumer media will beat that horse to death, and enthusiasts such as Macworld readers know much of that history already.

So he and I are now brainstorming about how we might enliven a 25-year retrospective. He had the quite serviceable idea that we shouldn't just focus on the past, but look also towards the future. I suggested that maybe we might place this article smack-dab in the middle of a 50-year history, with a timeline of the past plus a timeline of the future.

Then I got that call from Rox.

ANALYSIS
It doesn't take a deeply insightful observer of technological trends to uncover the obvious fact that the past 25 years have witnessed an explosion of world-changing tech advancements. Just for the proverbial shits 'n' giggles, let's review that "Information #1" section above, and list all the terms and concepts that even well-informed technologists of 25 years ago would find as difficult to comprehend as Tom Waits's Chinese Algebrassiers.

Take a deep breath, it's a long list. First, terms: podcast, smartphone, ringtone, IR remote, docking speakers, multi-touch screen, digital photo, Wi-Fi, 3G, cellular, network, Ethernet, DSL, ISP, broadband. Then, concepts: phoning three states away while in a moving car on the budget of a college student, an affordable desktop computer with far more computational power and storage capacity than a room-sized minicomputer of 25 years ago, finding directions three states away using a computer in a home office, sending and receiving digitized information over phone lines at 1.5 million pieces of data per second, checking traffic in real time - oh, and a nosey dad taking a surreptitious peek at the building in which his not-quite-21-years-old daughter, 781 miles away, is planning to party that night.

Then there's the shabu-shabu dinner. My guess is that there weren't a lot of white folks who knew what the %$#@! that was a quarter-century ago. The world's gotten smaller and its intercultural yummies are better distributed.

HELP
Twenty-five years ago, predicting where our technology would be in the far away land of 2008 was a fool's errand. There were so many variables - technological, financial, social. We now, however, think that it may not be as difficult to predict the future, seeing as how the wild-west days of technology have faded (but hey, Moore's Law is still in force). But really, is forecasting what the technological world will be like in 2033 even remotely possible?

I have my doubts.

Variables: The imploding American educational system; the aggressive entrepreneurship of China and its neighboring states; closely held vs. open-source software development; the advent of multipurpose, multi-core microprocessors; disappearing oil and other carbon-based power reserves; the anti-science nature of the American political class; the always-incipient American progressive upsurge; the rise of Latin America due in large amount to the massive and increasing transfer of petrodollars to oil-rich states; the resurgence of an intellectually and technologically competent oil-rich Russia; the growing split in the American evangelical community between moralistic nanny-state types and environmental stewards in support of radical power-distribution change; ambition; laziness; greed; curiosity.

All of these factors - and, of course, many more - affect technological development. At question is not only what's possible, but what's wanted and what's necessary. What is needed to keep us alive (due to the challenges of global warming and/or global conflict) and what is "merely" desired to make our lives more pleasant?

In between lie education, communication, and commerce. Oh, and art. Did I mention art? If not, never mind - no one ever does at this stage of western "civilization."

So, 25 years from now, what will the technological landscape be like? Frankly, I haven't got a clue - but I plan to bend my brain around the question in the next couple of weeks. I want to project how technology - or, for that matter, its disappearance - will meld with our daily lives in 2033.

Wanna help? Check out my email address and drop me a note with your thoughts about two years out, five years from now, 10 years into the future, or even that vanishingly distant 25-year horizon.

Don't be shy. Go wild.

Hey. I've an article to write. Dinner. Mortgage. Tuition. Monthly iPhone tariffs. [back to top]

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If there's one bit of economic chest-thumping that gets under my skin, it's the bragging by business types about how American workers are the most productive in the world - a cause for celebration if you're a business owner or shareholder who's enjoying the fruits of that productivity, but a grinding pain in the workaday ass if you're one of those oh-so-productive workers.

Labor productivity is, at its core, a simple concept: The more output - goods and services - that an individual worker can produce, the more productive he or she is. In good times, productivity can be increased by improving the tools a worker uses to perform his or her labor. In bad times, productivity can be increased by forcing workers to work harder, longer, and faster.

Guess which times we're in right now?

Yesterday, the US Department of Labor's Bureau of Labor Statistics issued a report which announced that America's productivity had risen a full 4.3 percent in the second quarter of 2008 - a substantial increase that surprised most analysts. As Reuters reported, "business productivity surged at a revised 4.3 percent annual rate, nearly double the 2.2 percent gain previously reported and well ahead of forecasts for a 3.5 percent increase."

Good news for the investing class. Not so good news for the working class.

Workers aren't reaping the benefits of this rise in productivity. In fact, in today's news we learned that reported unemployment is over six percent, which is higher than it has been in five years - imagine what the actual unemployment rate would be if you factored in the underemployed and those who've simply quit looking or don't register at their local unemployment office.

Me, for example.

Recent gains in productivity are being realized by increasing the workload of those workers who are fortunate enough to still have jobs - and, hey, if they don't like the pressure, there are plenty of hungry folks waiting to take their places.

And not only are workers being forced to become more "productive," the gap between their take-home pay and the incomes of the wealthy continues to grow.

This stagnation in wages is, in the minds of some economic theorists, a good thing, as depressed wages tend to hold down inflation. Not only do low wages fatten a company's bottom line, but low inflation keeps a business's expenses for materials and services from rising. It's a win-win situation - if you're already among the winners. As one analyst put it, ""Inflation is probably not that big of a problem this go-around because you're don't have the wage-price spiral. You're not seeing growth in wages. That's the bottom line." Heartless? Yes. Good business? Yes - but only up to a point.

Paying fewer workers less money is a dangerous game for corporate America to play. The American consumer - as increasingly downtrodden as he or she may be - remains the engine of the American economy. Henry Ford - no friend of the common man - knew that his workers needed to make enough money to buy his cars, so he paid them accordingly.

That type of enlightened corporate self-interest is less important in today's global, weak-dollar economy, but at core it still holds true. Exxon didn't make $10.89 billion profit in the first quarter of this year (down from $11.66 billion in the quarter before that ... slackers) on overseas sales alone. The American consumer still matters.

But woe betide the consumer who lets his or her much-vaunted productivity decline. It's a very short slide from heroic, productive American worker to unemployed non-consumer. [back to top]

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I enjoyed this dish at my favorite local cheap 'n' fast lunch spot, and have tried to replicate it - maybe I've succeeded, maybe I haven't. Here's my attempt at a quick and easy version, in a recipe for a dinner for two. Give it a shot, and tell me what you think - I'm still working on the right balance among soy sauce, mirin, and olive oil.

INGREDIENTS
• Two dozen (or more) ume These are small prickled plums available at any Japanese grocery store - they're standard fare, if a wee bit expensive. You can choose to use more, but I'd advise against fewer. Pit 'em and chop 'em into tiny pieces.
• Eight large crimini mushrooms I wanted to try this recipe with morels, but morel season is over here in lower-northern California. Sigh. In any case, chop these into decent-sized chunks - maybe six to eight per mushroom cap.
• One medium-sized onion Chop this into large chunks - about one inch on each side or so - then separate them layer by layer.
• One pound of chicken thigh meat Trim off the major fat pieces, then chop into bite-sized pieces.
• A dozen shiso leaves Again, you'll need to find them at any Japanese grocery store, but these citrusy items are seriously worth the effort. Lay each down on your cutting board and use a sharp knife to slice out the center stem, then pile all the leaf halves on top of each other and slice them crosswise into one- or two-millimeter slices.
• Six garlic cloves More or fewer - your call: Crush 'em or chop 'em.
• Four tablespoons soy sauce I like low-sodium soy. You may not.
• Four tablespoons mirin If you've never used mirin as a not-too-sweet sweetener, you're missing a wonderful ingredient.
• Four or five tablespoons olive oil Some people like oily pasta. I don't. Use less if you're like me, or use more if you're a lover of fine-tasting extra virgin olive oil.
• 300g of thick spaghetti Your could, of course, use other pasta (as long as it's hearty enough), but in honor of the place where I discover this dish, I'm sticking with thick spaghetti.
• Green things The restaurant at which I discovered this dish adds steamed broccoli to the mix. My medicinal interactions prevent me from eating broccoli, so I've made the sauce with Anaheim peppers, to some success. I'd imagine that steamed or sauteed snow peas might be good, as well as dice-sized cubes of steamed spring squash. Asparagus? Haven't tried it, but wouldn't diss it. Artichoke hearts? Worth a shot.

PREPARATION
This is easy. Real easy.

First, get your pasta water boiling. Thick spaghetti usually takes about 15 minutes to cook fully, which is about the same amount of time needed to prepare the sauce.

So, fire up the water, go grab a beer while you're waiting for it to boil; watch the latest political embarrassment on the Internet or the tube. When your range has found the guts to boil the pasta water, dump in the pasta, toss in a splash of olive oil, stir a couple of times, then...

Dump the olive oil into a decent-sized saucepan. Heat it on high-medium until it starts to shimmer, then toss in the onions (and peppers, should you be so adventurous). Stir constantly for four or so minutes, until the onions begin to become translucent, then toss in the 'shrooms and add the crushed or diced garlic.

Stir.

After about three minutes, toss in the chicken chunks - stir well as the chicken browns, for about four minutes. After the chicken is well-browned, add the soy and mirin, stir, wait about a minute, then turn the range down to low and cover the pan to let the mixture cook.

When the pasta is ready, add the shiso and ume to the sauce, stirring it well.

Drain the pasta. When the pasta's well-drained and the sauce is well-heated, mix 'em together, then put the mix into bowls for serving.

Not spectacular, but pretty good, eh? [back to top]

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