December 2006 Archives

Carefully tracing the middle roadSo, now that the Iraq Study Group has finally produced their long awaited treasure map to buried ponies, the race is on to see who will be the last person to die for the monumental (some would claim "galactic sized") mistake we lovingly refer to as the Iraq war. Of course, every one has been pummeling the characterization of the report as "bi partisan", but if one looks around, one really can see that the reaction to the report has been one of those few moments of true bi partisanship agreement.

Pretty much everyone on both sides of the isle thinks the thing is a shit sandwich. One that carefully traces a line of pure brown right down the center in an almost Solomon like splitting of the differences between the two extremes of the differences of opinion on what to do about Iraq.

Most everyone is in strong agreement that the assessment given the ISG regarding the dire situation we face there is pretty bleak. Most everyone also seems to be convinced that this description is, indeed, quite accurate - or, at least closely approximating something far closer to reality than the rosy assessments proceeding from official sources. And there in lies the gambit of this prestigious assortment of wizened old men.

Now, I'm certainly not going to argue that the recommendations of the ISG aren't almost as stupid as the decision to get into the Iraq war in the first place - a truly hard thing to accomplish, in my mind. And I'm certainly not going to argue that, regardless of how perfect a pony plan the ISG recommendations may well be, that this administration will still mess up any recommendations by treating the recommendations as a cafeteria menu - ala carte. But what I am proposing is that actions have two kinds of consequences: the intended consequences and the unintended consequences.

One thing that has continually stood out as I've watched this miracle play unfold is the way this mirrors my own experience with the intellectual wasteland of corporate culture as it tries to deal with its own disastrous mistakes. This administration, after all, boasted about the highest number of MBAs and CEOs (evah!) comprising its ranks. This was the administration that would finally run our government the same way corporate American ran American (well, before they became global and consequently their "American-ness" is now irrelevant) businesses. And, which comes as no surprise mind you, this is one area where they have succeeded. Our government is, indeed, being run just like Enron, WorldCom, Global Crossing or just about any of our big multi nationals.

Bush, as has been made abundantly clear, is the CEO. He's a delegater. As has been often pointed out, he's been remarkably hands off on this war. Like most modern CEO's, he really doesn't do much except decide who gets to do what. His administrative assistant jots down the date he expects to see the milestone reached (if he's a great CEO) or simply the date he expects the job to be done (like your average CEO). He doesn't pay the task a bit of attention until its scheduled time because - well - why would he bother when he's left it in such capable hands?

And so we have the ISG playing the familiar role of "outside consultants" who are brought in by concerned members of the board to determine how to dig them out of the spectacular hole the CEO's hands off policy (I'm simplifying, obviously, but it's a good aproximation) has dug for them. And like all consultants, they're not actually hired to think independently. They're hired to give the predetermined answer the air of objectivity. They are there as the ritual cauldron in which the witch's brew of common wisdom is brought to a roaring boil and served piping hot to the lucky - and quite clueless - CEO.

But, like most consultants, the ISG did do a pretty good job of describing the bleakness of the situation. It's actually the easiest part of being a consultant - describing something approaching reality. And it's really the biggest wild card in the whole gambit - i.e. accurately (or some reasonable approximation) describing the situation.

Because even if the CEO doesn't listen, and regardless of whatever the milque toast recommendations happen to be, there's a surprising number of people who will be reading the report with a rather surprised look on their face as they finally come to the conclusion that things are pretty damn fucked up. When things get so bad that a party of outside consultants have to prepare a recommendation to do what everyone (well, the upper execs and the board members at least) thinks should be done - but isn't - well, things have to be pretty damn bad indeed.

And regardless of whether the CEO sees the shit sandwich that is being served up as the next meal, most of the shareholders and other interested parties can see the brown streak running down the middle of the bun. And seeing how - at the end of the day - it's not the CEO's company, rather, it's owned by the shareholders, when it finally becomes obvious that it's shit sandwich eating time, the stock plummets as finally the stupid money bolts for higher ground.

So, we can mark down December 6th, 2006 as the official date that the chickens flew George W. Bush's coop and the beginning of the the race to be the last person to die for the Iraq fiasco. The date the ships officially left the sinking rat.

After this meal, the fig leaves are going to be few and far between.

GAO report finds little competition, higher prices in deregulated markets

A new study by the Government Accountability Office takes the Federal Communications Commission out behind the woodshed and administers a thrashing over the agency's inability to measure and promote competition in the telecoms industry. Although the FCC insists that its deregulation of the market for phone and broadband services has lowered prices and increased competition, the GAO found that wasn't quite true. In fact, areas where the FCC has granted the most deregulation often have higher list prices for network access than areas still subject to price controls.

...

But that's not all; in addition to higher prices, there is actually less competition. "The data also show that the theoretically more competitive phase II areas generally have lower percentage of lit buildings than phase I areas, indicating that FCC's competitive triggers may not accurately predict competition at the building level," the report says.

The problem is that the FCC's definition of "effective competition" doesn't work very well. If multiple providers exist in a region of the country, then that region is dubbed "competitive," even though only a few homes and businesses may actually have a choice between providers. The report also noted that the FCC has trouble getting accurate competition data, since it relies on third parties to provide it, and those parties rarely have an obligation to do so. In one recent rulemaking, the FCC requested price data from carriers, but no one responded.

Brilliant!

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This page is an archive of entries from December 2006 listed from newest to oldest.

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