Dana Blankenhorn

Accepting failure leads to success

Usually I do a Rice science Friday feature here, often discussing some breakthrough in chemistry.

But two Rice University management professors, Jennifer George and Jing Zhou, have something important to say, so we'll talk about it now, even though it's not science. George is the Mary Gibbs Jones professor of management (Mary was the wife of Jesse Jones, after whom the Rice management school is named), but she also teaches psychology, so what they're saying is doubly important.

For George, the latest work follows on a 2004 paper  called "In The Mood: Cultivating Emotional Intelligence Pays Off ." Now they've got some data showing creativity is at its highest when both positive and negative feedback are supported.

Here's what I consider their nut graph:

"Creativity is more likely to take place in environments where individuals or groups feel free to take risks, and where failures are sometimes expected as a consequence of such risk-taking. The notion that, if you are going to try new things, you will sometimes fail, is understood."

Managements that accept some failure get more creative productivity.

Jim Cramer is Not an Economist

Asking Jim Cramer to play an economist on TV is journalistic malpractice. (Picture from the Sportolysis blog.)

But there he was tonight, with Chris Matthews, pretending to not only understand the economy, but foreign policy and the Chinese economic-political system as well.

What Cramer was selling is the same thing he's been pushing for a decade, happy talk.

This is not a slam on Cramer. He made his bones as a Wall Street trader. He was good at it. He understood stock trends, he knew how to play momentum. While everyone and his dog was making a killing during the dot-boom, Cramer did, too.

But he's not a businessman. TheStreet.Com was crap for investors.  He didn't see the dot-bust coming, either. He's not an economist -- he has no training in it. He's not a foreign policy analyst, either. Yet there was Matthews tonight, pretending he is all these things.

The "interview" is a perfect illustration of the weaknesses inherent in our TV age, the medium on which today's political thesis is based. Stardom and familiarity trump expertise, and thus happy spin trumps all. The idiot is Matthews, those who point a camera at him, and those who believe him.

What Cramer has done, in this decade, is become a salesman. He sells the idea of stock investing the way Mel Kiper Jr. (above) sells the NFL draft, the way Joan Rivers sells the glamor of the Oscars' red carpet, the way Rachael Ray sells cooking. (That's Rachael, to the left, from her syndicator Kingworld.)

Kiper can't run a football team, Rivers can't run a career, and Ray is not a restaurateur. They are TV personalities. So is Cramer.

Here's Cramer's trick. He touts companies that are sound but a little down, and in the short run they go up, because his viewers buy them. It's a self-reinforcing cycle, and few bother checking to see whether those same stocks outperform the market in the long term. (They don't -- he always claims to have sold them before they fall.) This is no more dishonest than Dr. Phil's playing a psychiatrist on TV. I'm just not going to be Phil's  10 o'clock appointment. Making Cramer your investment advisor makes you a fool.

Some days, however, Cramer's trick doesn't work. Today was one such day. He touted 10 stocks on his February 26 show -- all fell on February 27. McDonald's was down  $1.34, TransOcean lost $2.92, Halliburton lost $1.10, Global SantaFe lost $2.27, Moody's lost 49 cents, McGraw-Hill lost $1.56, Greif lost $9.54, China Mobile lost $5.12, Time Warner lost 89 cents, and Sociedad Quimica y Minera (a Chilean mining outfit) lost $10.45. Per share.

Events got in the way.

What Cramer told Matthews is that the Chinese will fix this, because they're Communists, and they control the economy. This is absolutely, completely 100% false.

What's the real story?

Lethargy Breeds Competition

The biggest casualty of America's phone monopoly is its competitive position in the world.

Not only have the monopolists systematically retreated from international investments, but now European companies are starting to invade our market. We should root for them because they're the only bulwark we have against the need for net neutrality legislation.

With ample competition there would be no need for net neutrality legislation. The very fact we have to fight for it is proof that true competition does not exist.

Fortunately we are starting to see some. An outfit called 1and1, from Germany, recently completed a fiber ring around Lenaxa Kansas in order to serve its Web hosting operations there. The investment means the German company bypasses AT&T control over local networks, and it can reach competitive fiber so its costs remain low.

Dissuading Tyrants

What follows is a thought experiment, one ripped from today's headlines.

It's part of the 1967 game, because I suspect these feelings are common among opponents of the present order, just as I feel they were common among opponents of the disorder from that time.

The same feelings were common in 1931, about the economic system, in 1895, about the political system, and in 1859, about the country as a whole.

It is out of such feelings that political revolutions spring, and new generational theses emerge, aimed not just at halting the current trend but at reversing it, and making it an object lesson for future generations.

If these feelings are in you, that's a sign. If these feelings antagonize you, that's a sign as well, because advocates of each failing trend did become more insistent as those trends crested. If these feelings don't move you at all, perhaps you ought to look again, honestly this time.

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Why doesn't the world get blown up every other Wednesday?

It's because tyrants are dissuaded. There is the fear of losing, and the knowledge that loss would mean the loss of everything -- your family's lives as well as your own would be forfeit. As would everything you've built, and everything your allies have built.

This final solution to tyranny happens in big ways and in small. Hitler was a big way. Charles Taylor was a small. Hussein and Milosevic fit somewhere in the middle. But regardless of how, the final solution to tyranny is always final. Those who espouse such philosophies, who even seem to espouse them, render themselves illegitimate, and become permanent outsiders to society.

The reason Dick Cheney and George W. Bush can even think about attacking Iran is that they don't think this can happen to them. They don't believe for a moment it's possible we could all lose this war. No Democrat can dissuade them. Neither can our allies.

The trouble is they're wrong.

True Leadership Avoids Hypocrisy

What frustrates people about both political parties at the end of this Thesis of Conflict is the wide and widening gap between words and action.

This is especially true in questions of leadership. What were individual, human hypocrisies under the Clinton AntiThesis of the 1990s has become the destruction of America's leadership in the world during this decade. I did not have sex with that woman has become I did not destroy the cradle of civilization.

The wide, and indeed growing, gap between our words and our action is now clear in our foreign policy, as Seymour Hersh reveals this week in The New Yorker. But it's also true on the other side, in the brouhaha over Hillary Clinton's failure to apologize for her vote that launched this war.

It's a continuing pattern not just in politics, but in business, in religion, in sports, and in too many personal lives. We deny, deny, deny, and even when we're caught, when we're forced to change our view, we deny that our views changed at all. Spin trumps reality every time. (And don't look to put a halo on me, either, as my family likes to remind me.)

More important is that the widening gap is most evident in the field I profess, journalism. It's been 10 years and these idiots still don't understand that The Daily Show is about them, and their innate hypocrisy. Chasing the dollar with the pretense of being above it, judging others while refusing to accept judgments themselves.

The fact that the media in this country, most especially the TV media, has allowed so many people to get away with this has done more to destroy the business prospects of media companies than anything else, even the rise of the Web.

It's true on every single beat, the shame of the press in ignoring the lies and going with the spin. The politics guys ignore Iraq and just eat the spin. The sports guys ignore steroids and just eat the spin. The entertainment reporters ignore drug abuse and just eat the spin. The business reporters are the worst, swallowing wholesale looting of public companies and repeating the spin of their PR people.

The 16 Million

Every crisis in America's political history carries with it echoes of past crises.

Today we have Southern rejectionism and belligerence, as in the 1850s, economic inequality as in the 1930s and a cultural war as in the 1960s. But the period this smells most like is the crisis of the 1890s.

It was during the turn of the last century, when the press was endlessly fawning over the "400" wealthiest families and their entertainer-friends, that William Sydney Porter (right), writing as O.Henry, produced the collection of stories known as The Four Million. His idea was that, instead of fawning over the 400, he would write about all 4 million people in New York, tell their stories, which were just as good, maybe better, than those of the 400.

We have something similar and even more frightening happening in our time. The media is endlessly fascinated with the 1600, as in 1600 Pennsylvania Ave., the White House and those who seek it. It's endlessly fascinated by the antics of the rich, especially the undeserving rich like Paris Hilton or Anna Nichole Smith.  But what about the 16 million? That's how many Americans today live in "extreme poverty," defined as a family income under $9,903 for a family of four.

These people are wholly invisible, to the print media, the TV media, even the Web media. The Administration's "solution" to the problem is to eliminate the program that came up with the number.

This is precisely what was happening at the end of the 19th century, to which this crisis era provides a curious kind of coda. The issues then were our expanding international role, industrialization, and the technology revolutions of motors, telephony, and mass production, which were grinding workers and farmers underfoot. Today we face the need to change our international role, post-industrialization, and the technology revolutions of the Internet, nanotechnology, and hydrogen. Once again workers and farmers are being ground underfoot.

Unwarranted Pessimism

I have long enjoyed John Robb's Global Guerillas blog. But when his book on the subject comes out it will have the far-scarier title of Brave New War. With the clear implication that we're all doomed.

Even Robb doesn't believe that. What he really sees is a new type of international system developing, with both our allies and enemies becoming global.

This is not as bad as it sounds. It means we have a lot more allies than we seem to at first glance, powerful allies. In this new world China can become an ally, because they increasingly have a vested interest in stability. In fact just about every government and business worldwide becomes an ally, if we are willing to engage them on an international level and treat them as adults. (The current Administration treats no one like an adult. In CheneyWorld everyone's 13.)

Sure our international enemies look more dangerous. These include not only globalized crime and terror groups, but home-grown terrorists around the world, who can turn to a global source of support. In fact this is just how I expect the "war" to "come home" to America, with Christianist, Neo-Nazi, and Racist groups inside this country linking up with groups like Al Qaeda, once their allies in the White House are out of power.

But that does not mean civilization is doomed, as the cover of Robb's book implies. While I sympathize with Robb's desire to sell books, and to obey a publisher demand that he make things look as scary as possible, I think those publishers are doing both Robb, and us, a terrible injustice. I think the publishers are living in CheneyWorld.

This Week's Clue: Freeing the Bits

The following essay should be considered Vol 11, No. 9 of my weekly e-mail newsletter, A-Clue.Com.

Stay tuned next week for our special 10th anniversary issue. Enjoy.

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Were it not for the Iraq War, the $200 billion theft of ratepayer money by the companies now known as Verizon and AT&T would be the greatest rip-off of all time.

For a decade, in every state and before the FCC, these two Bells and their predecessor companies promised fast broadband in exchange for rate hikes. They claimed to need the money to install fiber throughout the country. They promised to serve "every Middlesex village and town" but instead they pocketed the money, using it to consolidate nearly the whole country into two monopolies which are now seeking to destroy the Internet as we know it, demanding pay-offs from sites to let them reach "their" customers, who are essentially captive.

This is already the case in cellular, where the same companies are the largest "service" providers. They control what equipment is used. They control the software on that equipment. They cripple the equipment -- if they don't want you to be able to move photos using Bluetooth because they'd rather force you to pay for the privilege, you pay. They claim to provide Internet service but that, too, is crippled. You reach only the sites they let you, and pay whatever they decide. They also expect a cut on every financial transaction made on their "service." Politicians who have long used the Internet to solicit funds find they can't use cellular, because the carriers demand 50 cents on every dollar.

This phone trust, which is on the verge of becoming an Internet Trust (since they control the vast majority of the Internet Core in this country) have saddled Americans with slow service, ruinous prices, and obscene conditions. They have refused to invest in their networks for 10 years -- that case is proven -- and they have no real intention of starting now. No matter what they claim, their words are dust, because their actions speak louder.

But there's a lot that can be done, even now.

The Russert Rules

The Russert Rules, named after Tim Russert, is a new "ethical" standard for journalists, which turns them into, essentially, stenographers.

From a rush transcript of Russert's testimony in the Libby case:

My personal policy is always off the record when talking to government officials unless specified.

The rule puts all government officials in total control of what they say to any reporter. This is the opposite of what I was taught in journalism school.

Russert apparently believes that his access to newsmakers depends on his willingness to keep any secret they choose to divulge, until they give him permission to divulge it. Since this is the Washington Bureau Chief of NBC, the host of Meet the Press, since we're talking here of Washington, D.C., the highest-profile beat in the world, the Russert Rule has been adapted, or forced down the throats of nearly every beat reporter in our time.

Talk Radio is Right Wing Rock

Some of our pieces in The 1967 Game make obvious sense, like comparing Mitt Romney to his father George.

This one may make less obvious sense. Just remember we're not talking about talent, but about political history, and the political impact of what its adherents call an art form.

Talk radio is right wing rock and roll.

Talk radio is actually older than rock was in 1967 (it was barely 12 then), but as any visitor to the Hall of Fame will tell you, rock music actually traces its lineage further back, as it was originally a fast Rhythm and Blues. And R&B dated from the 40s, 20 years from the date we're talking about.

Modern talk radio also dates back 20 years, to the 1987 end of the Fairness Doctrine. Destroying the premise of broadcast regulation allowed right-wing screamers to take the bark off, to ignore community standards and wail away. You might think of Rush Limbaugh, then, as being the Chuck Berry or Little Richard (left) of this new art form.

Talk radio reacted to the Clintons much as rock music reacted to the Eisenhower years. It developed in reaction. If it had an Elvis Moment, it was obviously the Lewinsky Scandal. Just as with rock in the mid-50s, the Lewinsky matter pushed talk radio to the forefront, legitimized it, and turned its players into true national figures. Here is where a host of new stars emerged, like G. Gordon Liddy and Ollie North, each with their own song of white male suffering. The Day the Music Died was the day Clinton was acquitted.

The key to the rise of both talk radio and rock music was a defined audience, one with enormous loyalty and a feeling of oppression in their daily lives. White middle class men, many of them in jobs that required lots of driving (thus lonely), did for talk radio precisely what lonely teenagers in their bedrooms did for rock music. They defined it, they set its tastes, and they created their stars in their own image. They followed its message and took it to heart. (Oh, so that's why Limbaugh is so ugly.)