The end of the semester, and thus of our year here in the U.S., is approaching fast and we are beginning to feel bad about having to leave our friends, schools and Beacon Hill behind. It’s been an amazing year full of amazing people, a fascinating election and political, cultural and personal developments. On Thursday I’m writing the GMAT test which I need for a program I’m applying for this fall, I did a test-test today and scored in the 93 percentile, so it felt good. In a few days I have two papers due and next week I have my last final. Some hard work and then summer!
Secretary of State Hillary Clinton yesterday said that the U.S. is no longer “absent without leave” in the global climate change response. She, and her boss Barack Obama (see earthday speech below), says that America is now ready to take the lead on climate change, and let’s hope Europe, Japan, Mexico, China, India and others follow up, push and force the processes as far forward and fast as possible. One of the things I’ve learned to respect a lot during my time in the U.S. is the dynamic and powerful nature of dedication once people set themselves to something, when America decides to take action it will not simply talk about the issues. There is also a tremendous power in the American civil society which I never really heard about before I came here. Literally tens of thousands of amazing organizations are fighting the battle from the local level and up, pushing for green policies, green job creation, renewable energy, etc. There is hope!
Summer is finally here and Boston is a really beautiful place. Beacon Hill where we live have trees lining the streets and they are all exploding in white, green and pink now and a lot of people have flowerpots and boxes and stuff in their windows. Yesterday we went to RedSox vs. Yankees at Fenway Park, 24 degrees and sun made it a great experience. A baseball game is very long though and we didn’t enjoy quite the whole thing, after a while we had a “foot-long hotdog” and went down to Charles River for the sunset over Cambridge. Today it’s Backlash day, the biggest event in WWE Wrestling is coming to Rhode Island and Providence - and we’ve got tickets! After spending a year with the intelligentsia at Harvard it’ll be interesting to see another side of the U.S. We’ve also booked our flight home and it’s going to be on May 27th that we move back to Sweden, very sad actually. In order to become a little bit less depressed over it we’ll travel to Las Vegas on May 19th to make the big win! We’ll first travel to Grand Canyon and Zion national parks, then stay in Vegas a few days before leaving with our pockets full of money.
Maybe the most fascinating aspect of the financial crisis the last few weeks has been the outright revolution against the business elite. For every day that passes politicians are perceived more and more as the only ones concerned about the welfare of “normal” people. We see this everywhere, workers are fed up with astronomical salaries and bonuses and the elite has apparently no connection at all to how people see them, their work and their compensations.
Extremely high paid people have always legitimized that with referring to a competitive labor market and that firms need to pay that much to get the best people. Today it’s, to say the least, very unclear if this massive demand and willingness to pay really exists in reality. Further, and what’s more important, it’s not enough to have the board and top management supporting the compensation plans if shareholders, customers, workers and the general public have zero confidence in the company and view the management as greedy and selfish. The latest scandal in Sweden has involved pension companies and banks where in the case of the pension companies, bonuses were paid out even as returns dropped and pensions was lowered and in the case of the bank, bonuses were removed but salaries increased in a sort of secretively manner.
AMF Pension
Do you have trust in your pension company? (DN - one of the biggest newspapers in Sweden)
Yes - 8%
No - 92%
We see this trend all over the world now, people feel they have not been given their fair share of the growth in wealth the last few years and that they are sacrificing a lot now in times of crisis while some at the top are not. I must say that what I’m most surprised about is the lack of understanding on the side of the elite, the only explanation I can come up with is that they think they still deserve bonuses and that they do not understand what the “small people” are whining about…
Take a look at this new promotional video from the Army National Guard. Scary stuff. Is this really a serious way to recruit people for a life and death job where we ideally do not want people applying because it looks cool to be a warrior…? I think this video looks like a promotion for a war video-game rather than a promotion for a…real war game.
Yesterday Obama held his first address to the nation and it’s absolutely worth watching.
Again the president delivered a serious but sanguine speech and showed a pragmatism and dogma-free politics that I admire much. Some favourite excerpts:
The fact is, our economy did not fall into decline overnight. Nor did all of our problems begin when the housing market collapsed or the stock market sank. We have known for decades that our survival depends on finding new sources of energy. Yet we import more oil today than ever before. The cost of health care eats up more and more of our savings each year, yet we keep delaying reform. Our children will compete for jobs in a global economy that too many of our schools do not prepare them for. And though all these challenges went unsolved, we still managed to spend more money and pile up more debt, both as individuals and through our government, than ever before.In other words, we have lived through an era where too often, short-term gains were prized over long-term prosperity, where we failed to look beyond the next payment, the next quarter, or the next election. A surplus became an excuse to transfer wealth to the wealthy instead of an opportunity to invest in our future.
And for all of us worried about climate change and hoping that Obama will make sure the United States gets into the global effort against it soon, there was a lot of good stuff in the speech as well (check out video 3 below).
But to truly transform our economy, protect our security and save our planet from the ravages of climate change, we need to ultimately make clean, renewable energy the profitable kind of energy. So I ask this Congress to send me legislation that places a market-based cap on carbon pollution and drives the production of more renewable energy in America. And to support that innovation, we will invest $15 billion a year to develop technologies like wind power and solar power, advanced biofuels, clean coal and more fuel-efficient cars and trucks built right here in America.
The focus of the speech (and of the recovery plan) is energy, healthcare and education. The reason, Obama says, is that these are the three core components needed to build long-term prosperity and three things that will not fix themselves; politics and markets need to work together on these issues and we can’t afford not to invest in them today.
One fascinating thing about the speech, and the general mood here in America nowadays, is the way people respond to bashing up rich-people and blame them for the current crisis; like the cap on CEO pay and forced rollback of purchases of corporate jets. A couple of years ago rich people were the true American idols and astronomical salaries for the global CEO-elite was viewed by most people as simply their fair competitive wage. Sure, top executives at fraudulent companies like WorldCom and Enron wasn’t very popular - but most others were. Today when someone speak about the rich, normally followed by the words “greed” and “excess”, people respond like a group of angry farmers in 17th century france (check out the congress’ response when Obama mentions this in his speech). The day after the new administration came out with their plan to cap executive pay in the financial sector the reader letters to the New York Times was 1:6 in favor of the idea. Well Americans has most likely not lost all their faith in the elite and stopped admiring success (and believe anyone can achieve it), see this Newsweek article, but in any case - the winds of change are blowing fast and these are exciting times.
Who, Where, Why?
I'm a 28 years old swede political economist and entrepreneur trying to make things more sustainable. Here I write about things I do and think.
