You are currently browsing the daily archive for May 16, 2011.

Global Crisis Blog

America’s Hot Potato Deficit – Pass It On to Those Who Least Deserve It, Or Why You Must Never Die    in Virginia

By Shlomo Maital



The strength and beauty and compassion of a society is measured not by the brilliance and wealth of its strongest members, but by how it treats its weakest members – elderly, sick, handicapped, poor.  By that measure, America flunks.

    Everyone (including me) speaks of the U.S. federal budget deficit.  But one way the Feds have adopted to reduce and control the deficit is simply to pass it on, to the state governments.  According to the U.S. Center on Budget and Policy Priorities, the 50 state governments and District of Columbia have slashed spending by $430 b., laying off thousands of workers, paring benefits and pensions, hiked college tuition, slashed medical benefits and cutting education budgets.  They have had to do this because their revenues have been squeezed by the housing collapse, while Federal aid to the states has been cut.  The worst-off states, which are essentially bankrupt, are: California (deficit of 29.3% of spending, for 2012, meaning revenues fall short of spending by nearly a third),  Nevada (45.2 %),  New Jersey (37.4%), Oregon (25%), Texas (31.5%), and New York State (18.7%).  Only little Indiana, headed by Gov. Mitch Daniels, has a balanced budget. (Why don’t the other states benchmark his best-practice operation, that has made him a leading potential Republican candidate for President?).  

    The Federal budget pays for defense and interest payments, mainly.  The State budgets pay for public services.  So when the Feds squeeze the State budgets, the result is draconian cuts in services to all those segments of society who really need those services.   What is amazing is that it is the Republican Party that supports such drastic cuts, and the very people who suffer from them still vote, in large numbers, for that compassionless party!  Why?    

     According to the AARP Bulletin, many states are slashing child-care assistance.  Is this a just society, that dumps the burden of economic crisis onto children?  Virginia, not a poor state, is eliminating a fund that paid for funerals for those who had no money.  Good work, Virginia; just dump the bodies in the backyard.    


Innovation Blog

The World is Incurably Optimistic – Especially Innovators

By Shlomo Maital




 Tali Sharot

An excellent New York Times Op-Ed by Tali Sharot, a neuroimaging expert and author of The Optimistic Bias, reveals an interesting fact. 

  “Whether you are 9 or 90, male or female, of African or European descent, you are likely to have an optimism bias.  In fact, 80 per cent of the world does.”

   In many years of working with entrepreneurs, intrapreneurs and innovators, I have found that they are all especially optimistic.  All of them believe strongly that they will succeed, despite statistical evidence that most new product launches fail and at least 9 in every 10 startup businesses fail. 

    How can one explain this inveterate optimism?  After all, people learn.  Things turn out worse than we hoped and expected. So why is it we fail to adjust and eliminate this optimism bias and become more pessimistic?  Doesn’t evolution suggest that caution and pessimism fosters survival more than risky optimism?

   According to Sharot, “with the development of non-invasive brain imaging techniques, we have gathered evidence that suggests our brains are hard-wired to be unrealistically optimistic.  When we learn what the future may hold, our neurons efficiently encode unexpectedly good information, but fail to incorporate information that is unexpectedly bad”.

    But this hard-wired optimism causes problems.  “Take the red pill,” says Neo, in The Matrix.  That is – face the brutal facts, vital for any innovator.  So how can we resolve the paradox of hard-wired optimism and the need for reality?  Sharot has the answer. “Believe you will live a long healthy life, but go for frequent medical screenings.  Aspire to write the next Harry Potter series, but have a safety net in place too”. 

   This combination of sunny future optimism laced with close attention to present realities is a winning one.  Great innovators have mastered it.  

Blog entries written by Prof. Shlomo Maital

Shlomo Maital
May 2011
« Apr   Jun »