This is my Simple Layman's hArd-line, Common-sense [SLAC] three-tiered solution to our current malaise. Each tier revisits perception; planning & implementation. Let's leave the economics, which is nonscience, to the economists and the politics to the cleverly-polished..
At the heart of our troubles [Tier 1 of SLAC] lies the notion of competent leadership.
You could try and argue that our problems are rooted in economics but that, for me, falls a long way short. Condense any of the 'events' since Lehman's demise and the crux of the problem is always poor leadership. In illustration you might remember mad-man Madoff? He's a convicted liar & a cheat, right? It's also why investors lost $50 billion or so, yes? NO. That's only half the story. His scheme flourished because the SEC leadership structures failed in their basic mandate. Investors incorrectly, as it turned out, assumed the SEC's competence.. How about the ratings-agencies and their collective (some say collusive) miscalculation of the risks associated with securitised mortgage debt? That too was a cracker, not so? You can't blame Wall St. They'd wrap, securitise and hawk a crock of dung if they could get away with it. It's the nature of the beast; can't be helped. Here again leadership was exposed for what it was ie: blatantly untrustworthy. Investors were under the misconception that both regulators and ratings agencies had sufficiently competent leadership structures to ensure their basic mandates. Clearly that perception was wrong. You could say the same for the US government. Partisan petty-politics [PPP] still holds sway. As a non-American it's difficult to accept that the US, a country with a proud economic and cultural heritage, has failed to deliver competent 'people-bias' leadership. Amazing. Clearly my perception that the US could lead from within, is wrong. Across the waters, some time ago, EU-incorporation-rules were debated, agreed and then not-applied. Simplistically, you could point fingers at specific sovereign leadership parties from within member countries and claim that as the root-cause of the Eurozone's problems but where was Brussels? Perceptions that the EU had cohesive competent leadership structures to ensure complicity are wrong and so on & so on.. You could apply the same disappointment in leadership world-wide.
To convert negative impressions into positive perceptions takes some planning. Even so, good planning means little without delivery. So, only when the planning process is transparently representative and the plans rigidly applied ie: compliance becomes non-negotiable, will leadership be considered effective. Only effective leadership will change the perception and so on..
As an opening salvo SLAC theory suggests the following:
At the heart of our troubles [Tier 1 of SLAC] lies the notion of competent leadership.
You could try and argue that our problems are rooted in economics but that, for me, falls a long way short. Condense any of the 'events' since Lehman's demise and the crux of the problem is always poor leadership. In illustration you might remember mad-man Madoff? He's a convicted liar & a cheat, right? It's also why investors lost $50 billion or so, yes? NO. That's only half the story. His scheme flourished because the SEC leadership structures failed in their basic mandate. Investors incorrectly, as it turned out, assumed the SEC's competence.. How about the ratings-agencies and their collective (some say collusive) miscalculation of the risks associated with securitised mortgage debt? That too was a cracker, not so? You can't blame Wall St. They'd wrap, securitise and hawk a crock of dung if they could get away with it. It's the nature of the beast; can't be helped. Here again leadership was exposed for what it was ie: blatantly untrustworthy. Investors were under the misconception that both regulators and ratings agencies had sufficiently competent leadership structures to ensure their basic mandates. Clearly that perception was wrong. You could say the same for the US government. Partisan petty-politics [PPP] still holds sway. As a non-American it's difficult to accept that the US, a country with a proud economic and cultural heritage, has failed to deliver competent 'people-bias' leadership. Amazing. Clearly my perception that the US could lead from within, is wrong. Across the waters, some time ago, EU-incorporation-rules were debated, agreed and then not-applied. Simplistically, you could point fingers at specific sovereign leadership parties from within member countries and claim that as the root-cause of the Eurozone's problems but where was Brussels? Perceptions that the EU had cohesive competent leadership structures to ensure complicity are wrong and so on & so on.. You could apply the same disappointment in leadership world-wide.
To convert negative impressions into positive perceptions takes some planning. Even so, good planning means little without delivery. So, only when the planning process is transparently representative and the plans rigidly applied ie: compliance becomes non-negotiable, will leadership be considered effective. Only effective leadership will change the perception and so on..
As an opening salvo SLAC theory suggests the following:
- Dissolve the US Federal government and impeach the president because no-he-can't. Neither are functional. Reread The US Constitution, understand that one-man-one-vote means one-man-one-vote. Elect, by majority vote, one individual who is undisputed leader responsible for the appointment of a Presidential Panel of EXPERTS in their field with proven, exceptional skill drawn from the real world. Reduce the presidential term to two years or when performance measurables, clearly defined and non-negotiable, aren't met, whichever comes first. Federal states remain autonomous BUT subject to the Presidential Panel.
- In Europe demand tangible security for currently overly-indebted member countries and expel, out of the eurozone, any delinquent countries still in flagrant disregard of recognised EU regulations. If the EU is still viable and BTW. the jury's still out on the point, elect from within the EU a panel responsible for the formulation and rigid implementation of a regionally comprehensive economic plan. Restructure regional economic efficiencies and cross-pollinate the skills base. Raise regional funding through a single conduit via the issue of EU-guaranteed bonds.
- Collapse the Big 3 rating-agencies monopoly and open the market to improve competition. Scrap the current product-originator / ratings agency compensation model and introduce a transparent cost-levy specific to the product. This levy is paid on purchase of the product by the investor, collected by the product-originator on the ratings agency's behalf and then paid over to the ratings agency.
- Transfer risk of securities reg. non-compliance to the SEC. Investors have punitive claim against the leadership of the SEC arising out of third-party & counter-party non-compliance of securities regulations within the SEC's mandate.
In this way current leadership misconceptions may evolve into perceptions of competence.
*In Part 2 SLAC looks at infrastructure and the jobs market
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