11/28/08 (HuffPost)Ghosts of Transitions PastPresident-elect Obama appointed old hands to his top economic posts, explaining Wednesday that "the vision for change comes... from me." That's a way to deal with a central problem of transitions - how to achieve change while ensuring that needed turnover of senior staff doesn't dysfunctionalize agency administration. Transitions have dysfunctional tendencies. An expert on this is Carl M. Brauer, whose Presidential Transitions: Eisenhower through Reagan (Oxford University Press) highlights the dangers that should concern Obama transition staff, assuming they have time for anything but ranking resumes. Here are Brauer's five worries: More. 11/20/08 (HuffPost)Experts Slam DoD Waste in Book for Obama. Read the stunning new book from the Center for Defense Information (CDI) on the long-term budgeting weaknesses and strategic blunders of the DoD. It's a remarkably good read as well as offering a buffet of common-sense reforms for the new President and Congress. Rep. Barney Frank has already called for a 25 percent cut in the military budget. The budget may be hard to cut that much right away because of the overstretched troops in Iraq and Afghanistan, but the new book makes clear many ways to save money in the out-of-control military budget without diminishing U.S. security. The book, America's Defense Meltdown: Pentagon Reform for President Obama and the New Congress, is out just two weeks after the election, exemplifying one of the themes that runs through it, namely the importance of speed and the ponderous nature of America's dug-in military apparatus, which is critiqued as stuck in the century-old second generation of four generations of warfare. The eleven chapters of the book are written by 13 retired Pentagon insiders, retired military officers and defense specialists. The book is edited by Winslow T. Wheeler, Director of CDI's Straus Military Reform Project. CDI has itself found a home in the World Security Institute. Wheeler worked for 31 years for U.S. Senators from both political parties and the Government Accountability Office. More. 11/16/08 (HuffPost) Stiglitz on War Cost, Economic Outlook. Economics Nobel Laureate Joseph Stiglitz spoke Friday at a fundraiser for Economists for Peace and Security (EPS), which was created to study the "full costs of war and conflict." He has a lot to say about the economic cost of military spending and the outlook for the U.S. economy. Joe is introduced by EPS Chair Jamie Galbraith. The room is full and buzzing. Here's the view of Joe sitting in a window-seat in the back. I'm in the first of three rows of chairs facing our speaker. Jamie, son of much-missed EPS leader John Kenneth Galbraith, is here from the University of Texas at Austin. He acknowledges contributions of some sons of Texas to the current financial fiasco. Certainly, Big Apple investment bankers and Orange County (Calif.) mortgage hustlers couldn't have caused such mischief by themselves. They needed Texan Phil Gramm and friends to change the laws. (Must-read story on the credit default swap high jinks is in the Texas Observer.) Jamie modestly refrains from promoting his own new book, The Predator State, and expresses delight that the nation has now elected a man who is "mortgaged to nobody". James limns Joe's unique record of insight and foresight about the dangers of ideological economic policies, and holds up a copy of Joe's new book, The Three Trillion Dollar War. More. 11/13/08 (Blogspot)From the Obama Brand to the American Brand. AdAge is running a poll right now on whether the American brand will improve under President-Elect Obama. Positive responses are sweeping the field. And why not? We know Obama is tremendously popular overseas. He's a citizen of the world. More than that, Obama has shown he knows how to handle his own brand. He stayed on message, whereas McCain's Most Vicious Attack Was on His Own Brand Name. More.
11/11/08 (HuffPost)A Salute to Those Who Have Fought for Us. On Veterans Day we salute those who have served in the U.S. Army, Navy, Air Force, Marines and other services. The poppy became a symbol of World War I dead and Armistice Day because of In Flanders Fields, the poem by the Canadian John McCrae who was a battlefield physician in Belgium in 1915. Our honoring of Veterans Day suffers by comparison with Memorial Day, which has a similar purpose and is more widely observed as a holiday because it starts the U.S. summer season. Memorial Day also dates back further, to 1866 when a memorial was first held in Waterloo, NY to honor dead Union soldiers. Our honoring of this day is also not what it is in Europe, where the tragedy of World War I is still a painful memory, so many young men having been killed senselessly. Their memory is evoked by The Green Fields of France, a poignant song about the fallen soldier Willy McBride. More. 11/5/08 (HuffPost)Obama's Branding Genius. A month ago I posted an analysis from my friend Patt Cottingham that gave seven cogent reasons why the Obama brand was better than the McCain brand. See Brand Expert Scores Obama v. McCain 7 Ways. Well, AdAge is convinced by the outcome of the election and announced today that yesterday, November 4, is the most significant day for marketers in the history of the world. Wow. AdAge's Al Ries gives President-Elect Obama the marketing prize for the "Change" theme. Here's the picture that set them off (as if you needed to see another): The Obama branding gets high marks on three criteria: 1. Simplicity. About 70 percent of the population thinks the country is going in the wrong direction. Hence a smart focus on "change." 2. Consistency. Most advertisers try to "communicate". They should be trying to "position" consistently. 3. Relevance. "If you're losing the battle, shift the battlefield." Obama forced his opponents to devote much of their campaign time discussing changes they proposed for the country and showing why they were different from Obama's. 11/3/08HuffPost)NY Phone Bankers for Obama. New York State is a safe bet for Obama. The NY State delegation in the House of Representatives splits 23-6 for Democrats and may shift to 27-2 in the next Congress. The NY State Senate, Republican for 69 of the last 70 years has a one-vote GOP majority and eight Republican seats are being strongly challenged. So New Yorkers, who like to target their energy where the payoff is greatest, are traveling in substantial numbers to Pennsylvania and other states where the races are close. And they are phone banking in droves. Typically the phone-bank volunteer signs up by web site/email (ny.barackobama.com/last call) or by phone (866-611-6447) for one or more two-hour time slots. More. 11/2/08 (Blogspot)Marathon Waste. The NYC Marathon today is going to produce 130 tons of waste. This year the NY Road Runners Club is recycling the gallon jugs used for dispensing water. They didn't used to, and the jugs were thrown out with NYC's waste. The Road Runners are looking into charging runners a license fee to be auctioned off the way seat-license fees are auctioned off by the Jets. If the runners are willing to pay such a fee, some part of the revenue should be allocated to making the NYC Marathon a model of waste reduction and recycling.
OCTOBER 2008 10/29/08 (Blogspot)Needed: Washington Response to the State and Local Fiscal Crisis. An early issue for the new president is the fiscal crisis facing state and local governments. Beleaguered officials have watched July-September revenues come in lower than expected while financial markets have become more risk-averse. These officials are lobbying Congress for help - expect the heat to be turned up after the election. The Federal Government is the only one of America's 87,500 governmental units that can print money, although that trick gets harder to play each time. A Federal response could be to provide short-term fiscal assistance in exchange for commitment for structural changes that will bring state and local revenues and expenses into balance and will bring debt service below a reasonable ratio to a multi-year average of tax revenues. It's not just that states and localities have seen revenues decline. Many pension funds that have invested heavily in equities and a year ago seemed to have adequate funds to pay pension obligations now look grossly underfunded. More. 10/27/08 (HuffPost)McCain Fails on Economy - Poll. A 54 percent majority of more than 200,000 respondents to an AOL poll think John McCain can still win on November 4, eight days from now. Respondents attribute his second-place standing to the weak U.S. economy. The poll asks: "What should a McCain comeback strategy focus on most?" Of 180,000 respondents to this question, 54 percent believe he should focus on economic solutions. Only 19 percent say McCain should focus on his experience. Only 18 percent say he can succeed by attacking Obama. Only 9 percent opt for some other formula for a McCain victory. More economists are forecasting a deep global recession and the markets agree. The Hang Seng index fell as much as 15 percent this morning, more than on any day since the Tiananmen Square incident in 1989. More. 10/19/08 (HuffPost)Dubya Had the Heat Turned Up in August. A valuable news report can have a misleading headline that the reporters (off the record) disavow. The excellent graphic in the New York Times yesterday was headlined with a question: "Can a President Tame the Business Cycle?" This is like asking: "Can a President End Poverty?" They are both misleading questions leading to an inappropriately negative answer. The chart depicts the consequences of the economic policies of recent presidents. It shows what an economic disaster Dubya's administration has been, borrowing heavily (he ended the surpluses of the Clinton years) and discouraging saving with continued low interest rates and unchecked rising asset (especially housing) values. More. 10/13/08 (City Hall News, New York: Op-Ed)How the Mayor Can Really Help Create New Jobs. Dr. John Tepper Marlin: “I don't know what I do next," a mid-career Lehman Brothers worker told me last week. "Barclays doesn't want my unit. Maybe I should start up a business." Nearly 30 years ago, Mayor Bloomberg did just that. He left Salomon Brothers in 1981, during the recession of 1981-82, and he turned his $10 million severance check and Salomon shares and his insights into the value of technology to Wall Street into a giant company with more than 9,000 employees concentrated in the New York City area. Now, to replace jobs being lost in financial services, New York City needs to repeat that many times. More.
10/13/08 (HuffPost)Gordon Brown's Trumpet. The first sound was a muffled rat-a-tat as the rise in housing prices in the first half of the millennium's new decade triggered concern about a bubble. The drum roll became more menacing in 2007 as housing prices plunged in many areas and foreclosures rose. When problems arose in credit markets, polychords rose above the drums. More.
10/8/08 (Blogspot)Letter from London - Big-Bang Bug for British Banks. It has come to this. Big Bang was to open up UK financial markets to stop grousing by Oxford-Cambridge graduates about the higher earnings of their Wall Street cousins. But opening up the UK markets also allowed in the U.S. subprime-CDO-CDS virus that laid low many U.S. institutions and now has more UK victims. Europe's more regulated financial sector has been relatively immune to the disease. How the right and the left do converge in such a crisis. Dubya's administration with Phil Gramm's leadership was engaged in a methodical deregulation of the financial markets. But it showed no hesitation about swiftly seizing the commanding heights of the mortgage lending and investment banking industries. In Britain, Gordon Brown's Labour Party - ideologically far more prepared to turn its banks into government bureaucracies - delayed taking action but is now buying equity in its banks. The Financial Times calls the bank bailout a "part-nationalization". Newspaper headlines this morning focus on a £50 billion UK bank bailout, referring to capitalization aid, with later issues using a £500 billion figure to take account of purchase of securities. 10/7/08 (Metro New York)Meltdown Gives, Patrick Arden. New York. Protesters banged pots and pans yesterday outside City Hall, in opposition to the mayor’s redevelopment plan for Willets Point. They wanted half of the 5,500 new housing units to be set aside as affordable, but some observers wondered whether the mixed-use project was now doomed by the current economic crisis. “Willets Point is in trouble,” said John Tepper Marlin, the former chief economist for the city comptroller’s office from 1992 to 2006. The city is facing leaner times, he said, “and we already spend 16 percent of our revenues on debt service.” The mayor has called for a third term to finish his big plans, but Marlin asked, “Who knows which of Bloomberg’s projects will survive?” 10/6/08 (HuffPost), Brand Expert Scores Obama v. McCain 7 Ways. The Obama and McCain brands have been rated by branding-strategy expert Patt Cottingham of Genuine Imprints, Ltd . Her paper "Brand Obama or Brand McCain?" is featured this week on brandchannel. It's astute. Here's a summary she wrote for me: More.On October 8, someone searching for "Brand Obama 7" in Google gets 116 million hits, of which this post accounts for eight of the top ten. Top 10 links to this post, 10/8/08: Vot3r, URLFan, Buzz, Barack Obama News Blog, Askville, Keegy, Friendfeed, Bloglog, BlogJunkies, Teleprompter.
10/2/08 (New York Times)Mayor’s Stewardship Is Mixed, Fiscal Experts Say, David W. Chen and Michael Barbaro. Mr. Bloomberg prepares to announce on Thursday his plans to seek re-election, he may well be volunteering for the ultimate test of his financial skills — managing New York City in the middle of a global financial crisis and in the face of some potential fiscal problems he may well have contributed to himself. “I would say it’s a bigger economic challenge for him than Sept. 11,” said John Tepper Marlin, chief economist for the New York City comptroller’s office from 1992 to 2006. “It’s not just New York City — it’s a whole system in trouble. Yet it’s our residents and our workers who will be affected."
10/2/08 (Wall Street Journal)Prospects Brighten for Bloomberg's Green Agenda If NY Mayor Changes Term Limits, Nathan Koppel and Dionne Searcey. Many in the financial community support the prospect of a third Bloomberg term, believing the mayor, the founder of business-information service Bloomberg LLP, is better positioned to engineer a turnaround than other potential candidates. He not only has the experience of an incumbent, they say, but also deep ties in the business community and government. "Bloomberg moves at a very high level and has good access to Washington, D.C.," says John Tepper Marlin, the former chief economist for the city's comptroller's office from 1992 to 2006, who notes that the federal government will be an increasingly important source of funds for New York. "He has a lot more clout than other mayoral candidates." SEPTEMBER 2008 9/22/08 (NY Sun)NYC Pension Funds Lose on Lehman, AIG, Ross Goldberg. New York City's pension system appears to have lost about $230 million since June from the collapse of Lehman Brothers, Merrill Lynch, and American International Group, increasing the strain on taxpayers after a year in which the funds already took a $6 billion hit. The city's five pension funds shrank by 5.4% of their total value in the fiscal year that ended June 30, according to data [from] the comptroller's office. The city will have to make several billion dollars in unexpected contributions to the funds. Irrespective of the poor performance last year, the city's annual contribution to the pension system will have nearly doubled between fiscal years 2005 and 2009, when it will owe about $6.1 billion. John Tepper Marlin, who served as the city's chief economist until 2006, said the losses that have been made public are probably just a preview of trouble to come. The collapse of Lehman, the sale of Merrill Lynch, and the government takeover of AIG last week did not mark the end of panic in the financial markets. Pension funds tend to perform about as well as the economy as a whole, Mr. Marlin said, and the future of the economy is currently unclear, especially as the federal government embarks on an unprecedented intervention into the free market. "The stuff is so sophisticated and complicated, I can't believe there aren't going to be some surprises," Mr. Marlin said, noting he collects a city pension. "I'm worried for myself and for the city." New York City's pension system has earned 9.5% annualized returns over the past five years, compared to 10.2% for its peer funds. 9/21/08 (Newsweek Radio) Newsweek On Air Podcast (click on the start triangle at the left end of the line below 9/21/2008). John Tepper Marlin interviewed: Congress should act to break the credit drought, but the public is going to demand something in return.
9/12/08 (Blogspot)Chris Ward, Port Authority ED, Speaks Out. Ward credits Congressman Jerry Nadler for asking good questions about rail freight in the Congress. Nadler, who is in the audience, in turn praises Ward for the direction he is taking the Port Authority. With a few pointed words, Ward takes issue with the Bush 43 Administration for understaffing the FAA and trying to promote market-based auction systems instead of addressing the capacity problems of airports in the NYC area and elsewhere. "We need a GPS-based system. The market is not going to solve the airport congestion problem."
9/2/08 (NY Post)City Will $trike Out If Yanks Miss PlayoffsDamn Yankees! City businesses stand to miss out on making $141 million this fall if the Yankees fail to make the playoffs for the first time in 13 years, according to a study commissioned by The Post. The report conducted by NYU adjunct professor John Tepper Marlin shows that if the Yankees snag at least a wild-card berth, a first-round appearance could fill the coffers of bars, restaurants and other businesses across the city with $26 million. Marlin, a former number-crunching chief economist for three former city comptrollers, said the Bronx Bombers would need to make the playoffs every year if the city hopes to reap any economic benefits, a feat many fans and businesses have taken as a given since 1995. See also NJ Star-Ledger NYC could lose $141 million if Yanks miss playoffs.
JUNE 2008 6/28/08 (NY Times) How Much Are the “Waterfalls” Really Worth?Ken Belson, NY Times. Amid all the hoopla over Olafur Eliasson’s “New York City Waterfalls,” which opened on Thursday along the East River, one might think the city was in for a windfall. When asked whether the public art installation was worth the $15.5 million it cost to erect it, Mayor Michael R. Bloomberg and other “Waterfalls” enthusiasts have said the exhibit is expected to generate $55 million in economic activity during its run, which ends in October. That amounts to about 0.09 percent of the $59.1 billion budget city officials agreed upon hours after the water began to cascade under the Brooklyn Bridge on Thursday — roughly the amount generated by a single World Series game during the Subway Series in 2000. And while such forecasts on economic impact are often bandied about by elected officials and tourism boosters, their accuracy is difficult to assess, particularly in the case of a public display like “Waterfalls” that has no admission charge and can be taken in during a walk, a bicycle ride or even while taking the subway — or sitting in traffic — over the Manhattan Bridge. How much of the money visitors spend on T-shirts or bottled water while viewing the exhibit would otherwise have gone to, say, movie tickets or museum souvenirs (or bottled water while doing something else)? "The methodology is not invented; it is based on something,” said John Tepper Marlin, a former economist for the city who was responsible for many an economic-impact evaluation in his day. “But the margin of error is quite wide. How many people are going to come from out of town? You could say 10,000 and I could say one million, and who knows?” See other stories on this topic. 6/23/08 (NY Sun) City's Tourism Industry May Be Weakening, After Strong 2007, Peter Kiefer, NY Sun. NY City’s tourism industry may be starting to slow after a record year in 2007 and months of continuous growth this year. The city's hotel occupancy rates fell to 87% in April, down from 88.4% a year earlier, according to a monthly report issued by the city's Economic Development Corporation. The 1.4% drop in hotel occupancy, long seen as a barometer of the health of the city's critical tourism industry, comes after three months of year-to-year growth and is the largest decline for any month in 2008, according to statistics provided by the city. Additionally, the Economic Development Corporation is reporting a decrease in Broadway ticket sales. In the four weeks ending May 25, Broadway attendance was around 1.1 million, 3.3% less than the same period last year. Broadway revenue in this period was around $79 million, a 2.8% decrease from the same period last year. A former chief city economist, John Tepper Marlin, said hotel occupancy and Broadway ticket sales are telltale signs of the health of the tourism industry. But he said the declines were not enough to merit major concern, at least not yet. “One swallow doesn't make a summer," he said. "But I would be concerned that I am losing market share to someone else." 6/4/08 (HuffPost) Green Banking, Good Banking. Yesterday I listened to Jack Brennan, CEO of the trillion-dollar Vanguard Group, pioneer in low-cost mutual funds and people's capitalism. He got me thinking that if the great Senator Carter Glass was the main force behind a financial structure that served us well from the Glass-Steagall Act in 1933 to 1999, then Phil Gramm was the Samson who tore it down and left a war zone. What Brennan said that made me think was: "Vanguard is guided by three principles - respect, patience and humility." I asked him at the end: "These are unusual, value-heavy words. Do you have ethical issues with the subprime loan-CDO era?" "Yes, I do, we do," he said, "That's how we see it. Vanguard didn't own the CDO stuff." It makes sense to me. I expect more financial brands will be jumping into the morning-after post-CDO era by positioning themselves as the anti-CDO, the long-term sustainable partner. When the city mice have just been gobbled up by fat cats before the eyes of their country cousins, the country mice will be eager to return home. More. FEBRUARY 2008 2/15/08 (Blogspot): NYC More Catholic, Jewish, Muslim than USA.Virgil describes how Aeneas came from Troy to what became Rome and *(inferretque deos Latio) he brought with him his religion. As America's Number One immigrant gateway city, New York City has many Aeneases. What NYC lacks in Protestants it more than makes up for in numbers of Catholic, Jewish and Muslim adherents. It is much more Catholic (62 percent vs. 44 percent) than the rest of the USA, much more Jewish (22 percent vs. 4.3 percent), and more Muslim (about 2 percent vs. half of 1 percent). More: 2/15/08 John Tepper Marlin, Blogspot, NYC More Catholic, Jewish, Muslim. 2/15/08 (Thrive NYC): Tepper-Marlins. For a big-time New York City power couple, Alice and John Tepper Marlin seem suspiciously easy-going, considerate, and friendly. It’s a little hard to reconcile. What is it that allows these two veteran movers and shakers to keep it all in perspective and to remain just so darned nice? More: 2/15/08, David Gibbons, Tepper-Marlins, Vivid/Lives, Thrive NYC 2:6 (February 2008).