Draft: Writings on the Wall

The nation’s lowest income earners can soon expect a pay raise for the first time in years. In the meantime, they have been effectively taking a pay cut as inflation and rising consumer costs have reduced the value of the relatively stable minimum wage. As the newly minted Democratic Party Congress works to lead the charge to raise the minimum wage at the federal level, they will find that many states and localities have beaten them to the punch. The majority of residents in the United States now live in areas that require higher minimum wages than the federal government’s minimum wage.[1]

Opponents of a higher minimum wage argue that the cost of such a proposal outweighs the benefit that low income families would receive. They point to studies such as Joseph J. Sabia’s “The Effect of Minimum Wage Increases on Retail and Small Business Employment” for the Employment Policy Institute that show that a “10 percent increase in the minimum wage is associated with a 0.9 to 1.1 percent decline in retail employment and a 0.8 to 1.2 percent reduction in small business employment.”[2] However, these concerns have not deterred voters and politicians alike from calling for minimum wage increases throughout the nation.

Representative Jesse Jackson Jr. of Illinois told the HPR that “Local `livable wage' campaigns and the recent ballot initiatives help Democrats and Republicans to understand that the American people are serious about raising the minimum wage.” An example of one of these successful campaigns can be found in Santa Fe, New Mexico, home to the nation’s highest minimum wage. Passing the Living Wage Ordinance wasn’t an easy task and the first attempt in 2000 failed. However, Mayor David Coss told the HPR that through a “powerful coalition of labor groups, the faith community, some small businesses and the immigrant community,” the issue “became a really great movement,” and the resolution was inevitably passed by the City Council in 2003 with 7 votes in support, 1 opposed. The Santa Fe Living Wage Ordinance increased the minimum wage to $8.50 beginning in 2004, and $9.50 in 2006.

Of the arguments that moved Santa Fe toward passing the Minimum Wage Ordinance, Mayor Coss added that “when employers don’t pay a living wage, then the community as a whole subsidizes that need.” After the first year the living wage ordinance went into effect in Santa Fe, Temporary Assistance to Needy Families caseload declined 9%. “Most effective was the organizing of the community, and the education of the community. We framed the issue as a moral question, and the faith community spoke very powerfully about the dignity of work.” Mayor Coss concluded by stating that, “If anything, raising the minimum wage has helped the economy and helped working families,” which shows us that “economic development in Santa Fe, or anywhere, does not require poverty.”

Elsewhere, even more dramatic steps have been taken. Through Proposition L, San Francisco not only raised the minimum wage to $8.50 in 2004, but indexed it with the local Consumer Price Index to preserve its value. The current minimum wage, effective January 1, 2007, is worth $9.14 an hour. In an interview with the HPR, Aaron Peskin, president of the local Board of Supervisors, attributed the 2003 passage of Proposition L to San Francisco’s high cost of living, the static condition of the state minimum wage and “a national minimum wage so anemic as to be virtually meaningless.” Proposition L passed resoundingly in 2003 with 60% of the vote, in spite of fierce local opposition from organizations such as the San Francisco Chamber of Commerce.

Aaron Peskin told the HPR that, “Contrary to the fears of naysayers at the time, San Francisco’s economy has grown by leaps and bounds.” Peskin acknowledges that “this fact does not mean causation,” but emphasizes that the threatened “negative economic impacts have not been realized at all.” This finding has been corroborated by researchers at the UC Berkeley’s Institute of Industrial Relations, which found that the new policy did not affect employment growth in local businesses, but that fulltime employment increased and job tenure improved, health insurance coverage remained stable, and that the policy did not spur business closures.[3] Unfortunately for those dining out, they did find that relative to other restaurants east of the San Francisco Bay, the price of menu items increased approximately 3% more.

As the movement to increase the federal minimum wage comes to fruition, it has ultimately been up to each individual state and locality to decide whether or not to enact higher minimum wage laws. But it is probably because so many states and localities have decided to enact higher minimum wages that politicians on the national level are finding it easier to support minimum wage increases. Representative Jackson also came to this conclusion when he told the HPR that "Most change in Washington comes when the grassroots gets active. In fact,” he added, “it's almost impossible to move anything through Congress until the grassroots gets active.”

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[1] http://pewresearch.org/obdeck/?ObDeckID=18

[2] http://www.epionline.org/studies/sabia_05-2006.pdf

[3] http://www.berkeley.edu/news/media/releases/2006/01/02_livingwage.shtml

First Harvard Article

Hey all, thanks for remaining so supportive and helpful! I can't believe I have my first college article under my belt... well, at least half of one. They ended up calling it the "Golden Laboratory", which I guess makes a lot of sense since it's about two Californian school districts (and one of them is in the wonderful city with the Golden Gate, and both are in the Golden State), but I still can't help but think about usurping their prerogatives as editors to choose our titles. I suppose I can get over it. But geez! The Golden Laboratory?! And also, it seems like an additional 10% of my words were cut off because of space restrictions, which is still OK, but I also feel that it is important to note that there is still a lot of controversy and disagreement within the San Francisco school district, and perhaps the impression from the article (after the editors' edited it) paints too rosy a picture. But that's okay, it's all for a great city.

The more detailed rough draft concerning SFUSD can be found here. Oh, and the official picture for the article's pretty bad too. It's supposed to be the San Andreas fault and it's supposed to represent... you know. Needless to say it wasn't my idea, so for my blog, I stole their cover art, which I was surprised to find was...... San Francisco's Golden Gate Bridge!! (THAT was the pic that I wanted for the article. :sigh:, but wow, SF on the cover of the HPR).

Golden Laboratory

California’s experiments with education reform
BY AUDREY KIM AND JASON WONG

Supreme Court Justice Louis D. Brandeis famously noted in 1932 that thanks to America’s federalist system, “a single courageous state may, if its citizens choose, serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country.” The state of California has never been shy about taking Brandeis up on his offer. Most recently, California’s two iconic cities, Los Angeles and San Francisco, have attempted to take leading roles in the effort to revitalize American schools, with each city taking a very different approach to the problem.

The City of Angels
The political power struggle over Los Angeles schools has just begun. Spurred to action by Los Angeles Unified School District’s astronomically high dropout rate, which exceeds 50 percent for black and Latino students, Mayor Antonio Villaraigosa recently proposed state legislation that would transfer powers currently held by elected school board members to one superintendent appointed by the mayor. The reasoning behind this bill was identical to that which had been used previously in New York, Chicago and Boston: linking the mayor’s reputation to school district performance would create new accountability and produce real results.

Not surprisingly, the Los Angeles School Board bristled at the mayor’s foray into their jurisdiction, launching a campaign claiming that Villaraigosa was meddling in education for political purposes. These claims are probably not entirely unfounded: Villaraigosa is widely considered to be the frontrunner for the Democratic gubernatorial nomination in 2010. A big win on education could help him cement that status. On the other hand, the mayor’s defenders are right to point out that Villaragosa has plenty of other good reasons to care deeply about schools, notably his own experience as a high-school dropout.

Regardless of the mayor’s sincerity, though, the electoral stakes of school reform have politicized the process and left its progress uncertain. Lawsuits about the constitutionality of the mayor’s bill are still pending. The school board recently appointed retired Navy Vice Admiral David Brewer as its new superintendent without consulting Villaraigosa. At present, a four-month legislative battle has led only to increasing animosity between education-related interest groups in Los Angeles, with students left in the lurch.

An Educational Treat
A few hours’ drive up the 101, San Francisco and its divergent approach to education provide a useful comparison to Los Angeles’s experience. With solid test scores and a strong upward academic trend, the San Francisco Unified School District and its leaders have found their reforms studied throughout the nation. One of these lauded reforms is the so-called Weighted Student Formula, which allocates school funding based on the special needs of individual students.

The creation of WSF and other novel policies has been aided by San Francisco’s methods of school management. Unlike Los Angeles, district governance in San Francisco typically involves a high level of community participation that includes many different stakeholders. Each school supports a School Site Council that includes school administrators, teachers, faculty, parents, and even students. Without such inclusive decision-making, it is doubtful that the Unified School District could have undertaken its experimental new initiatives. With parental participation and community representation on a regular and voluntary basis, the school district received an added boost to its own efforts for school reform. The changes seem to be paying off, as districtwide test scores have gone up.

District councils and committees also help educate budding activists, volunteers, and politicians. One candidate for school board, Bayard Fong, who has served on a School Site Council, told the HPR in an interview: “It helped me to be in the culture of thinking about all of these key issues, and to make schools better in San Francisco.” Within a few years, his PTA has grown from involving only eight regular members to a current membership of 90.

Striking a Balance
At a time when school districts are finding themselves under increasingly strict supervision, San Francisco and Los Angeles have found ways to stand out among the crowd. Los Angeles’s approach has been much more dependent on mayoral leadership, which has bred some controversy, while San Francisco’s has emphasized consensus and community participation. But in their fundamentally different political environments, both cities have tried to strike the delicate balance between autonomy, community, and oversight that makes for a successful public school district.

Copyright Harvard Political Review, 2006. All rights reserved.

George W. Bush: Lessons from our Past

[1] When describing the “mortal threat” by “regions of the world […] prone to ideologies that feed hatred and excuse murder” (Bush, par. 4) in his inaugural address, President George Bush illustrates the importance that fear and trepidation have come to guide his Presidency. The purpose of describing that “mortal threat” in Bush’s speech does not lend itself toward a scholarly analysis of the global political situation, and neither does the speech delineate specific policies to deal with this “mortal threat”. Instead, his use of literary license supports the overall appeal of his speech where he seeks to strike a chord with his audience that makes them more willing to be led.

[2] Not unlike poetic prose, President Bush’s speech is dense in symbolism and metaphoric elements meant to elicit powerful emotional responses. This shows us that the speaker has chosen to use literary license over more precise, factual arguments and language. Specifically, by choosing to use emotional appeal as his persuasive weapon of choice, President Bush attempts to follow other great speakers (Presidents Lincoln and Roosevelt among them) in their strategic appeal to their audiences. To perform this task President Bush’s goals are twofold: his speech must establish his credibility as someone who could be trusted to lead, and then the speech must attempt to place the audience in a state where they are more willing to be led by the speaker’s reasoning and appeal. Notice the importance of figurative verbs and adjectives in his literary style.

We have seen our vulnerability – and we have seen its deepest source. For as long as whole regions of the world simmer in resentment and tyranny – prone to ideologies that feed hatred and excuse murder – violence will gather, and multiply in destructive power, and cross the most defended borders, and raise a mortal threat.

(Bush, par. 4, emphasis added)

[3] This excerpt of President Bush’s Second Inaugural Address comes close to the beginning of his speech. This passage appears after the formal introductory motions of the inauguration, and also after he establishes the foundation for the speech’s discussion of our “vulnerability” by first describing the “day of fire.” (Bush, par. 3) Together, “day of fire” and the above passage are metonymically linked with September 11^th and the War on Terror; they are associations that would elicit fear, anger, resentment, and other similar memories and reactions from his audience. What follows this excerpt, however, is a passage that seeks to elicit hope, idealism, and other energies from which the people of America could rally around.

There is only one force of history that can break the reign of hatred and resentment, and expose the pretensions of tyrants, and reward the hopes of the decent and tolerant, and that is the force of human freedom.

(Bush, par. 4)

This emotional appeal comes at the cost of intellectual analysis of the conditions or political elements that allow for the enemy to foster. At the same time, the speech’s strength is in its descriptive simplicity that allows ordinary Americans to follow the emotionally arousing literary elements of the speech.

[4] Throughout the speech, President Bush attempts to imply or associate his Presidency as the leader of this great “force of human freedom” that will “break the reign of hatred and resentment”. He continuously requests his audience to “believe the evidence of your eyes” (Bush, par. 23), and states that “My most solemn duty is to protect this nation and its people against further attacks and emerging threats.” (Bush, par. 10) After articulating his desire to be a leader who will push the “force of human freedom” and in so doing “protect this nation and its people”, he then moves on to the second purpose of his speech. This is where he delves into our willingness to be led and our willingness to push the same “force of human freedom” with him.

[5] By appearing noble, and describing his greater purpose as President to protect “this nation and its people”, the speaker tries to emulate similar speeches where previous Presidents, as inspirational leaders, appealed to the support of their audiences to be led in a united direction. President Bush’s strategy in his speech is to persistently address his audience to “Make the choice to serve in a cause larger than your wants, larger than yourself - and in your days you will add not just to the wealth of our country, but to its character.” (Bush, par. 23) He describes this character as “idealism and courage”, and repetitively defines “America’s ideal of freedom” in broad, universal terms that are nearly impossible to disagree with.

[6] However, by choosing to utilize the broad, universal and literary concepts over the precise and factually substantive arguments that he avoided, President Bush loses the specific purpose that Presidents Roosevelt and Lincoln each had in their speeches, and he loses the unified direction that those other speeches elicited. President Roosevelt in his first fireside chat simply asked for rational behavior in the time of the Great Depression, (“You people must have faith; you must not be stampeded by rumors or guesses. Let us unite in banishing fear.”), and President Lincoln in his Gettysburg Address hoped specifically to rejuvenate America’s capacity for fighting the Civil War (“It is for us, the living, rather to be dedicated here to the unfinished work which they have, thus far, so nobly carried on.”). Through their use of language, each of these Presidents used their speeches and their ability to speak to the American people at large as a tool to organize their listeners to act responsively. Bush, however, asks for too much or is too vague in his request, and the effect of his speech is diluted.

[7] Compared to Roosevelt and Lincoln, President Bush asks for a range of goals (“freedom” and “liberty”) which he has broadly defined to include “America’s ideal of freedom” (Bush, pars. 25, 26, 27). He loosely defines such statements to include “private character”, “service, and mercy, and a heart for the weak”, and “the dignity and security of economic independence”. None of these requests ask for specific actions such as an entreaty to stay away from banks until they are fiscally stable again (Roosevelt), or to continue the Civil War despite hardships already encountered (Lincoln). Perhaps the positive populous reaction that moved people to continue fighting the Civil War or stay away from banks was not apparent after the respective speeches of their Presidents, but time has come to show that their speeches did have an effect; and in the end the banks survived, and the war continued until the North reunited with the South. Instead of requesting a specific action from his audience, President Bush asks more for a state of mind so that his specific policies can be fit into these ideologies. Thus, compared to the speeches made by Roosevelt and Lincoln, President Bush’s speech is made less effective, because he asks for more from the audience than he reasonably and substantively addresses in his argument.

[8] When George W. Bush stated that “we are determined to show the meaning and promise of liberty.” (Bush, par. 24), people in general did not know how to show that “meaning and promise of liberty.” Bush did not specify that Americans needed to be more attentive in electoral politics in order to show “the meaning and promise of liberty”, or state that they could donate more to a local charitable organization, or implore them to volunteer more in a local school or church. This lack of specificity wastes the emotional energy of his speech, because there is no way for Americans to carry on the force of his address. Thus, his speech will diminish with time, as opposed to instances in other speeches where Americans responded positively and that President’s speech lives on.

[9] The foremost strategy of George Bush’s Second Inaugural is to inspire. Once his audience is awed and energized into an emotionally heightened state, George Bush specifically moves to project that energy to support his policies and politics. He utilizes creative literary devices to heighten the effect of his speech. But the major flaw of Bush’s Second Inaugural Address is that even though it effectively concentrates its strength in its emotional appeal, it can hardly substantiate itself to intellectual analysis—it cannot grow organically with time through the actions of its listeners. George Bush stretches his argument far too broadly for his audience to take a specific argument meaningfully to heart as they have with other speeches. This speech then will not be remembered for its efficacy in riling up the American populace, but as another generic speech that will fade as others are continuously etched into the American consciousness.

Chinatown ESL

Last Saturday, I had my first stab at being a teacher. The day before, I was called in the evening and had been told that it was imperative that they needed another English teacher to teach ESL students the next day, and I agreed to give it a try.

Around 10:30 a.m., there ended up being a group of about a hundred gathered around the center of Harvard Yard. Together, we organized into levels and trekked to our classrooms, where we began to introduce each other.

Most of these people are seniors, and all of them don't know how to speak English real well. As with any culture, the Chinese really respect their elders. The Chinese also really respect their teachers. It was tough for me to get used to being called "Wong laoshi" (laoshi = teacher) by people who had grandchildren who were potentially my age!

When we started our lesson plan, I saw mostly seniors (65 and older), and a few people under 60, dutifully open up their lesson books, take notes, and give their best efforts to repeat theh English terms and terminology that we provided them. Even though I only had just met them, I developed an instantaneous respect for their desire to learn, and admired what past experiences they must have already been through. To still be excited about classes, and about learning, has been one of the most inspiring things I have ever been a part of!

This week, we collected the homework assignment that we had assigned at the previous week's class. I read about 15 short paragraphs on husbands, deceased family members, and countless entries on sons, daughters, grandsons, and granddaughters. My respect for these people have only grown with time, and seeing them once a week has been a great way for me to re-invigorate and inspire myself to be as dedicated and as passionate, and as caring and respectful as they are. I have learned a lot from these people. I'm really grateful for this.

The Better Side of Education Politics

by Jason Wong

(Note: Rough Draft, even the title may change)

With solid test scores and a strong upward academic trend, the San Francisco Unified School District and its current and former leaders have found themselves scrutinized for their innovative reforms and mimicked throughout the nation.

In terms of comparable school districts, San Francisco has been ahead of the curve—San Francisco’s notable policies are beyond the implementation phase and many of these policies have been working for San Francisco students for years. Among the most well known policies of the San Francisco Unified School District, and the most controversial, have been the San Francisco Nutrition Policy, and the Weighted Student Formula.

New Ideas, Old Ideals

The birth of these novel policies to SFUSD has been aided by traditional democratic practices. District governance in San Francisco typically involves much community participation and the decisions made are far from autocratic. The Weighted Student Formula and the San Francisco Nutrition Policy are byproducts of this massive co-operation between community members, parents, school faculty, administrators, and district staff.

Without such representation, it is in doubt whether or not these projects undertaken by SFUSD could have been as wildly successful as they have been. With parental participation and community representation, the school district received an added boost to its own efforts for school reform.

It is forty such volunteers (district staff and community stakeholders) that were on the committee responsible for crafting the majority of the Weighted Student Formula. The San Francisco Nutrition Policy was also largely crafted by district staff and community volunteers, with the support of school board members and key administrators.

In of itself, the Nutrition Policy is perhaps one of the most influential of such policies in the nation. It has been three years since its implementation, and since then countless other school districts have followed suit, with similar nutrition policies signed into law in California and other states. Even the American Beverage Association recommended limiting the availability of soft drinks in schools—two years after San Francisco’s Nutrition Policy took effect.

Increasing Incidences of Civic Participation

San Francisco schools are full of political and administrative activity, from the lowest levels of school site management to the upper echelons of the school district administration and governance. Each school supports a School Site Council whose membership comprises of school administrators, teachers and faculty, community members and parents, and even students.

In fact, it is the School Site Council that manages the Weighted Student Formula funds that it receives to balance the school budget. It is the School Site Council that determines individually how many resources to allocate to teachers and staff, school supplies and technology, special programs and projects, and other budgetary items.

Each student is weighted under the formula to determine the specific significance of the resources that the student brings to a school. Schools are thus held responsible for attracting students in order to receive an appropriate level of school funding, and students with special needs or from low income backgrounds are given more “weight”.

This Council serves in addition to the other councils and committees district-wide that community members and staff serve on, some previously noted. Each of these committees is charged with handling tasks from the site specific, to the general district wide policies.

A Self Perpetuating Cycle

SFUSD’s many active committees and councils, in addition to providing meaningful impact to San Francisco students, serve as a perpetual educative resource for the experienced, budding activists and volunteers, and the potential politicians.

Even students are influential in crafting their own educational experience. Two students currently serve on the San Francisco Board of Education, and hundreds (if not thousands) of others have been involved in School Site Councils and PTSAs.

In addition, many of the candidates for this year’s school board elections have served in various capacities for individual school sites and district wide committees, or as school site volunteers.

One candidate for school board, Bayard Fong, remarked on his experience serving as the chair for his school’s PTA, and as a member of his school’s School Site Council, “It helped me to be in the culture of thinking about all of these key [education] issues, and helping to influence that culture to include your own spirit, your own experience, and your own positivism, to help make schools better in San Francisco.”

Within a few years, his PTA has grown from only involving 8 regular members, to a current membership of 90. Test scores have improved too, by 34 points on California’s Academic Performance Index to 666 out of a possible 1000.

Not Good Enough

Even though San Francisco has the highest test scores of an urban school district in the state, and test scores have been improving at an amazing average of 5% per year in math and 3% per year in English for the past five years, San Francisco still has a ways to go before being able to rest on its laurels. Among the problems plaguing San Francisco is the perception that beyond a certain circle of high performing popular schools it is better to go to a private school (its private school population is among the highest in the nation), and the familiar achievement gap between members of different ethnicities in academic performance.

That may soon change. There are many examples of San Francisco public schools that have switched from being undesirable to becoming some of the most desirable schools in the city in a short amount of time. Parental and community involvement are credited with turning schools such as Aptos Middle School, Alvarado Elementary School, and Miraloma Elementary School (just to name a few) into some of the most desirable schools in the city, and there are rising stars in many of the neighborhoods that primarily only low income students with little choice would go to.

More Discretion, More Community, More Results

At a time where school districts are increasingly finding themselves under stricter guidelines and policies that typically hinder innovation, SFUSD has flourished. Over the past few years, San Francisco public schools have been at the forefront of innovative policies that have positively affected the educational experience of its students, as well as involved them in public service and key education decision making. This distribution of balance, autonomy, and oversight has served as a successful contrary model to that of city or state takeovers, and the movement toward charter schools and school vouchers.

The "Oracle" of Omaha

(It's three a.m., and I'm probably not as coherent as I could be, so there are probably more edits, additions, and revisions to come. My apologies.)

I am still in awe. Like I wrote in my facebook that sometimes, over time, or in person, your heroes can disappoint you. For two reasons: either you had unrealistic expectations of them, or you forgot that everyone no matter who they are is a human being, and human beings have flaws. Sometimes it's a combination of the two, but I can unabashedly state that Warren Buffett's one of my biggest heroes ever, and that he has not let me down.

The first thing in the 2 hour Question and Answer session, Warren Buffett begins by asking us to ask him any thing that we're thinking about, and he'll do his best to tell us everything he knows. He's a funny guy too, at many points during his responses he'd throw in a few jokes that really would make us laugh. No, we were not laughing at anything he said because he's Warren Buffett, but because he's a genuine guy, and being humorous is part of who he is.

My take on him is that he genuinely loves talking to students. I say this because he's let many students over the years visit him. We're definitely not the first, nor I don't think we're the last, but usually he doesn't let undergraduates visit him, so I feel lucky that as a freshman I got one of the rarest of the rarest of the rarest opportunities to go visit this man. He auctions off an hour or two of his time over lunch sometimes (like once or twice a year for charity), and people pay upwards of $600,000 for his time.

Well, I guess I should back up and start from the beginning (this looks like it might be a lengthy post). Warren Buffett is the second richest man in the world. Quite recently, this year actually, he has dedicated AT LEAST 85% of his wealth to charity. To the Bill and Melinda Gates Foundation, specifically. Additionally, he still lives in a house he bought in 1958, not a palacial castle, nor does he have a driver. He drives his own car, does mostly his own thing, and people with a fraction of his wealth act more pretentiously and more uncaringly than he does. Pretty much, he lives his life like a regular joe schmoe, even though he's richer than 99.999999 percent of us, like us. Wow.

I got up at 3:30 a.m. to catch the plane to Omaha, with a layover in Minneapolis. At around 12:15 p.m. that day, about a little more than 2/3rds of the group headed over to the Gallup Organization. They gave a presentation about their organization, and about the work they do other than polls. They talked about themselves as an organization, and about the work they've done for other companies. One of these things are the StrengthsFinder, which evaluates the five most prevalent strengths of an individual. The probability that two people would have the same general strengths are probably one in 34 million. Mine are Arranger, Learner, Adaptability, Responsibility, and Achiever (in that order).

Afterwards, we headed off to a place where we had a Q and A with Wally Weitz of Weitz Funds, which manages about 6 billion dollars in assets. We also learn that Berkshire Hathaway (Warren Buffett's company), briefly traded at over $100,000 a share, a momentous occassion for Buffett. Afterwards, we had a reception, and Warren Buffett himself made a surprise appearance for an hour!! He looked so comfortable talking with us. Lol, and LaMisha over there looks contemplative, for once ;).



Anyways, we rubbed elbows with a few of the business people over there for dinner, and then, quite suddenly, the big day comes and we're off to first visit Nebraska Furniture, and then go to Warren Buffett's headquarters and hear from the man himself. The CEO of Nebraska Furnitures (believe me, the store is HUGE, about at least five times bigger than the biggest Ikea), gave us a personal tour and a run down of how the business is managed and how they do so well to keep profit margins high and how they keep their dominance in their market place. They have close to 90+% (my estimate) dominance in a MARKET RADIUS of 250 miles! He let us ask any question we wanted to, and even rolled out a gigantic poster of Warren Buffett as a model for one of the products, a mattress!! haha.

Okay, sorry for all the details, but this is kind of my journal too! So now we're leaving this humongous beast of a store to see the beast of the investment world. Let me say that this guy's priorities are awesome. He doesn't go for lavishness, and he doesn't make money to spend money (except on charity), he does what he does because he's good at what he does (he considers himself a capital allocator), and simply does what he loves. How many other people are unhappy because they don't do what they love? And how many others are just superficially happy. For example... ask what would happen if you just take that person's money away... what would happen to them then?

During his Q and A session, Warren Buffett quite seriously talked about one of his friends there at Omaha. She's an eighty year old polish jew, and he said she doesn't have very many friends. Her reasoning, she told him, is "when I make friends, I can't help but think, if it became necessary, "would they hide me?"" And Warren Buffett added, there are people out there, who's kids out there would be oh so happy to point toward the attic and say my parents are up there. What kind of family, what kind of lifestyle is that... if you can't count on anyone to hide you if it came down to it?

One of the first questions from the group was about his private jet. Before he bought it, he used to speak out about his colleagues' extravagance. Now that he has one, he says, he appreciates it that much more because he wouldn't be traveling so much without it. He confesses that it was a hard decision to make, but then it's become worth it because otherwise without it, he probably would have to cut back on making deals and traveling. Therefore, even though he still feels it's extravagant, he could understand how, if you have the means, you would want one. In terms of everything else, though, he lives just like you or I would. He has a nice home, a nice car, he sleeps seven hours a day, reads the newspaper. He doesn't blow his money (aside from his jet), on other extravagances like living in Las Vegas or on showy incidentals that other people would. Man... you can admire his wealth, but you can't fault him for being inconsistent, at least on principle.

One person in the back tried to ask a question, and because he couldn't hear that prompted him to tell a story, or a joke. He complained about getting old, and how he was worried about his best friend and business partner (Charlie Munger), about his hearing. So, one day, he decided to ask Charlie across a room, to kind of test him, and Warren asks if they should buy Microsoft Stock. Warren doesn't hear Charlie respond, so Warren walks halfway across the room, and asks the same question, and he doesn't hear a response again. This time, Warren goes and speaks directly in his ear, and Charlie responds, "For the third time, Yes."

On Capital Allocation, Warren Buffett walked us through on how he evaluates companies. First of all, he looks for good companies that are underpriced that any idiot could run, because eventually, one will. He extended that reasoning to countries too. (get it?). He pulled out a book on Korean companies, and said that there are lots of investment opportunities out there in other countries, and some of them are just as transparent, or even more transparent, than American companies are. So he was thumbing through this book on Korean Companies, and in a few minutes he had a list of 20 companies that looked interesting. He took one company as an example. Now, some companies are underpriced for a reason. But he pulled out figures of around these: The company makes about 200,000 yuan a year. (let's suppose these figures are accurate, because I'm sure my memory on the specific numbers aren't). The Company has assetts worth about an extra 400,000 yuan, and currently there are X many shares being sold at a total stock evaluation of only 50,000. He thought that was ridiculous, so he invested, and eventually, other people figured the same thing as he did, and the total evaluation jumped up to about 300,000. After all, the yearly income was more than the previous stock evaluation!! Take into account the Korean currency against the dollar this past year, and he made a sweet 12% (or 20, I forget which), on top of what he already made on the company!! All this, from only one page of information from a book of korean companies. Genius.


Another of the stories he told us was his time with the richest man in Russia. He was deciding to invest between a Chinese company and a Russian company. Even though the Chinese government owned 90% of the stock, he decided that it was worth it to invest about $400 million in it and control about 1.25 percent of it. Now, compared to what the Chinese government owns, that's almost nothing, but he figured rightly that that investment would be better than the Russian one. About this time last year, he was having lunch in California with the richest man in Russia, giving advice on the Securities Exchange Commission in the United States because this Russian billionaire was worried about how obnoxious the U.S. government is. Only a few months later, the Russian government throws their richest man in jail, and tears his company to pieces. This man is in Russian prison to this day, and Warren Buffett moved on to his most moving part of his Q and A, and talked about how we've all won the ovarian lottery.

He spoke to the room, granted, it was filled with Harvard undergrads and Texas A & M business school students, and said we all have won the ovarian lottery. Imagine, before being born, if you were told to reach into a barrel with 6 billion tickets, and choose one. But wait, you are here, and most of you were born in America. Would you trade what you have, for, let's say a hundred potential tickets in the bucket? Heck no. Why would you? You're where you're at now, and if you did, half of it would be the wrong gender (because most of us would want to keep our gender), that eliminates about half, more than half of the tickets wouldn't get you anywhere because you'd be living in deep poverty, and only 1 if you're lucky, would land you a place in this world where you have an opportunity to do what you love and do what you do best to succeed in life.

So what happens when you win the ovarian lottery? Is it fair, that even before you're born, you're already separated into different paths and different lives? The reason why he gave to charity, is because he feels that those of us who are lucky are duty bound to still do the best that we can in life, and then do the best that we can for those who pull out the unlucky tickets. I'm not being as eloquent as I could be, and I'm definitely not doing Warren Buffett's words justice, but I hope the point is still there. I just hope I haven't mutilated it too badly.

Anyways, after his two hour Q and A, which was full of revelations, and he definitely didn't disappoint his listeners, he treated us to lunch at his favorite place, Gorat's. After which, even though he makes a bajillion bucks an hour, he was gracious enough, heck, patient enough with us, to take pictures with us, as many as we wanted, how we wanted. He did Charlie's Angels poses, and he even granted wishes to pose kissing someone's cheeks, and was just overall very charming, unpresumptuous, and kind. He was more like a grandfather, than an influential business man.

I feel very, very fortunate to have been able to meet my hero these past two days. He even said, during his talk, that what helped him start was that he would go to the offices of CEOs and Professors and people he admired, and talk and learn from them. He feels that there are some heroes out there that have a flaw that makes them fall from grace once their discovered. They aren't really role models, because he couldn't rely on them. He felt he was lucky to have good role models to follow that didn't disappoint, and I feel that lucky too.

A Different Take on Scrooge

I never thought of Scrooge as a charitable person before, but it turns out that he just might be one of the most charitable people of all.

"In this whole world, there is nobody more generous than the miser—the man who could deplete the world's resources but chooses not to. If you build a house and refuse to buy a house, the rest of the world is one house richer. If you earn a dollar and refuse to spend a dollar, the rest of the world is one dollar richer—because you produced a dollar's worth of goods and didn't consume them."

What I Love About Scrooge (Slate)

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Sunlight breaking through my morning window
The blinds set way up high
A cool breeze whisking the stale air out while
I take a breath, ready for the new day.