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"I'm living in the future, so the present is my past" -Kayne West

Let's Get Political: Economics

I, for all intensive purposes, am a Libertarian. The Libertarian Party is running Bob Barr as a candidate for President. Living in California, I also happen to believe that my single vote has very little influence in most presidential elections (and I’m probably right, as long as you ignore any social influence). Therefore, I believe in voting for the person I think is the absolute best choice for the presidency, not the best two party guy who can win it.  With all of that said, it would appear possible that I’d be voting for Bob Barr. I’m not. Barring (eh? eh?) some crazy, unforeseeable event, I will be voting for Barack Obama in November. This is my attempt at explaining why.

Disclosure: I will make an attempt to lay this out in a rationale, organized manner, I may fail. Writing concisely about issues I’m passionate about is something I’m working to become better at.

The issues that matter most to me are the economy (Stances:Ob, Mc, Barr) and foreign policy (Stances:Ob, Mc, Barr), and I also value the ability to be an effective leader. The first two are relatively easy to research, but the latter is a bit less concrete, more intuitive. It’s my belief that in these 3 issues, Barack Obama is the best choice for our country, and I’d like to offer my reasons why. In the interest of reading time and space, I’m going to address just the economy in this post, more to come later. Thanks for caring enough to read -Tyler

Economy:

Barack Obama has a clear economic plan that he has presented in speeches and online. It involves tax cuts for the middle class that are specifically aimed at jump starting the economy. In our current economic situation, something like this is needed. The middle class will spend money much more freely than people with larger incomes, which will affect the economy in a quicker fashion.

I do have some fear that Obama’s plan would stifle small business growth and the rate of entrepreneurship, he has helped address these fears with his $500 tax credit to help 1099 contractors offset the extra payroll tax they shoulder. As an independent contractor who made relatively normal (read: way less than 250k) salaries for 15 months out of the last 24, I can attest that a measure like this would have helped me. I’m not sure this break will be enough to encourage small business growth, and I think more can be done on this front.

I’m not sure how many of the 20-some million small businesses will be affected by a marginal income tax increase proposed by Obama; my understanding is the company would have to have more than 250k/year in revenue to be affected, I’m assuming that a large percentage of these small businesses are one-man shops and fall under this rate. If you have more than 250k/year in revenue I would assume you’re incorporating and playing the corporate tax game, and not filing under the individual system. I’d love to see some #’s on this though, it could make a huge difference in the health of this plan.

Note: Obama has also suggested eliminating the capital gains taxes for startups and small companies, but I must admit that I’m relatively ignorant on how this might affect the average small business — I will need to learn more about this and may expand on this point at a later date.

Compare this to Bob Barr: I like that Barr is against the bailout, as I am (although Buffett’s arguments in favor of it may eventually sway me), but I can’t seem to get any specifics out of his campaign. Barr’s website has little information on specific suggestions. I agree with the standard speaking points of the Libertarian Party: less taxes, free markets, cut spending, etc. But it’s hard for me to back a candidate that doesn’t put forth a plan, even if it’s just tactics on withdrawal. The same way you should put together a “get out of Iraq” plan, you should put forth a “get out of mucking around with the economy” plan.

The Libertarian Party as a whole generally has a problem with this. They are one of the largest third parties in US politics (4% of voters, according to Rasmussen which is slightly less biased than the 13% reported by CATO). The party is very broad, tying together an incredible amount of diverse opinons (most elections see Libertarian swing voters splitting between Democrats and Republicans 60/40 or closer) — putting forth specific plans would drive many party members away. So instead they stay vague and promote intellectuals working on these problems from many different approaches. Great for a think tank, shitty for a presidency.

McCain fares OK here. His small business plan makes some suggestions that will encourage growth in that sector, like lowering corporate taxes. His individual taxcuts look less interesting. McCain and Obama both talk about re-energizing the middle class, and it’s clear McCain’s plan doesn’t trump Obama’s on that front (verification from TPC). If McCain wanted to argue that Obama’s plan couldn’t be passed, or if he wanted to push for some form of trickle down economics, I’d listen — but they’ve both picked the same battleground and Obama has verifiably won it.

On top of all this, I’m very suspicious about where the money will come from. John McCain will not be able to decrease the size of government, and he supports an expensive war, yet he doesn’t seem to be securing new money to cover these massive cuts. That scares me.

His Gas and Energy platforms are nothing more than meaningless talking points that are essentially non-sensical (read them here, top of the page and middle of the page below this picture).

McCain’s HOME loan program seems misguided, and the suggestions on his website (strict requirements including a proof of due dilligence on all investments for bailouts on a firm by firm basis “only to prevent systemic risk” (Paraphrased from here) don’t seem to match his actions over the past 10 days.

I’ll confess an ignorance to some of the macro-economic issues at debate here. I’m not well versed enough to know, with relative confidence, which of these policies will fare the best. In situations where this is true, I find I need to take 3 actions.

  1. I have to write out what I know, discover what I don’t know, and try to learn that through research or talking with semi-experts (people that may not be qualified to set policy but that keep up with historical and current thoughts on the topic and are accessible to me).
  2. I have to look at the professionals, the people who are the real experts in the field, and see what their public thoughts are on the matter.
  3. I have to make a rational assesment of the information as I know it today, and try to get close to the right answer. As Warren Buffett has said, “I’d rather be approximately right than perfectly wrong.”

In this process, I have found the information out there on economist blogs to be in favor of Obama, based mainly on the criteria of who he’s getting his advice from. In terms of the pros, Obama has recruited amazing advisors and supporters (Paul Volcker, Warren Buffet, Robert Rupin, Laura Tyson, and a slew of others). McCain hasn’t fared poorly on recruiting pros either; he’s got a revolving list of people with economics degrees who support him on his site, Peter Wallison has done some pretty amazing work at AEI (including foreseeing the current crisis 9 years ago) and Gary Becker is nothing to shake a stick at (and writes half of a fantastic blog). They’re both impressive teams, but on the issue of where are the intellectuals I personally respect more are leaning–they seem to be leaning towards Obama; I think Buffett and especially Volcker lend better insight than Wallison or Becker — this is arguable, but Volcker/Buffett certainly have much more credibility within the finance world than anyone on McCain’s side.

Since both teams are impressive it’s important to note that, Obama seems to actually be listening to his advisors more. His statements on the economy are measured and well thought out — he doesn’t often have to change his stance or re-word things in light of new developments (which McCain has had to often). Obama’s certainly being rewarded in the polls, to quote the Financial Times, “…his instinct to reflect before opening his mouth and his impeccable taste in advisers are both working to his advantage.”

On the economic front, I think Obama wins.  *UPDATE* The Economist has realized an article that I think backs up my point pretty solidly, see this chart:

Ecomists favor Obama (a chart)

FYI: This (and all political posts) will be reposted on my.barackobama.com blog

PS: I highly recommed a recent interview with Warren Buffet (60 mins), his take on the crisis is very interesting.

PPS: If you want to donate to Obama’s campaign, please do: My Obama Page

Best Bug Ever

Today, Mike and I collaborated on the best bug ever filed. You can see it in it’s original glory here, or read the “edited for ease of reading” text version below:

——

So I was chatting with one of our clients yesterday, and he brought up a really good point: We need a way to bend space-time, to allow for faster than light travel or what we’ll call “beaming technology” We’re branding it as “Beam-Outs”

Here are the requirements:

  • It must have two mouths which are connected to a single tube (called a “Throat”) Nikki mocked this up here: http://skitch.com/tylerwillis/xrpe/wh
  • The wormhole must be traversable, meaning that matter can travel from one mouth to the other by passing through the throat.

We should implement a wormhole that fits our client’s needs. An inter-universe wormhole would probably be overkill, as he’s looking simply to travel to other locations on Earth (and perhaps within this solar system). Let’s go for the low hanging fruit on this one and simply build an intra-universe wormhole.

There’s currently a solution released by Albert Einstein under the Creative Commons Share-alike license, which I think we can adapt for our needs as long as we update it with new contributions. If needed, we can also reference the work of Dr. Evil. Most recent research indicates that wormholes must be made of spacetime foam (or “quantum foam” if you will) and must connect D-branes
together by way of a flux tube.

We need to build a special type of Lorentzian wormhole, which would allow a human to traverse unharmed. We’ll call this a “Krasnikov Tube”

Firstly, we must acquire some exotic matter (any substance with negative energy density), perhaps we can put our new outsourced guys on finding this? We’ll also need a flux capacitor and an energy source capable of putting out 1.21
gigawatz.

We must be careful that we use the proper mathematics for a Krasnikov, it would be simple to make an error that would render the wormhole un-traversable. Here’s an example of what the wormhole metric might look like, see this mockup: http://skitch.com/tylerwillis/xrpc/use-this-one-or-people-die

Eventually, the larger strategy is to implement a roman ring, which is a configuration of more than one wormhole. This ring seems to allow a closed time loop with stable wormholes, but we can probably wait until public beta for this feature. For Launch, we’ll need service between the following locations:

Redwood City, Switzerland, Mountain View, New York, Western Siberia, South Beach, Taipei, and Canada.

Here are some resources that might prove helpful:

Until we can hire an astrophysicist (Matt has a listing up on craigslist), Noah will probably have to do most of the work himself. Knowing that, I’ve found some “primers” that might get you moving in the right direction:

I was thinking, we might want to higher a new QA team for this project, it would be a shame to loose the ones we’ve already trained to the deadly grip of space. Let me know your thoughts on this.

Let us marketing guys know if we can help.

——- Comment #1 From Noah Horton 2008-07-04 17:24:03 [reply] ——-

Fixed!
It was actually pretty easy. The user of the wormhole simply ingests a compound to make their mind amenable to wormhole travel (http://en.wikipedia.org/wiki/LSD) and then allow them to enter the actual wormhole (http://www.acehose.com/mcart/images/ventduct22.gif). More portly users may need to use our add-on product (http://www.crisco.com/) to make it through the wormhole.

Distribution v. Marketing

I was chatting with a friend yesterday. I realized that, despite being at the cutting edge, he seemed to misunderstand what I was working on. The good old “forest for the trees” problem. I was talking to him about setting him up on the RapOuts platform (RapOuts is a client I work for) to promote a documentary he is producing.

He kept referencing one aspect of his event as being “where RapOuts could help” – namely spreading the word about the selection and user voting process of his event. He didn’t seem to see much long-term benefit past helping him spread this idea – in short, he was thinking like a marketer. I wanted him to use this push to create a communications channel that he could use indefinitely to talk directly to the people who care about his message, to make sure that the next time he wanted to push an idea, he didn’t have to recreate all the legwork. I wanted him to think of himself as building a distribution channel for his own needs.

In trying to bridge our disconnect, I made a distinction between thinking like a marketer and thinking like a distributor. Heads up, I’m going to use a very narrow definition of distributor in this article – a definition coined by European culture – ‘Any natural or legal person, including a retailer, who only stores and places on the market for third parties.’

What’s the difference between distribution and marketing? Marketers take an idea and spread it far and wide. Distributors build a channel that they control and that is used to connect things to people. That’s pretty esoteric, so here’s an example. Joe dons his distributor hat and builds a series of billboards up and down highway 280 from San Jose to San Francisco. He wants to sell a service, namely advertising on the billboards, so he switches his role from distributor to marketer and designs a message to sell his service. He uses his own billboards (distribution channel) to advertise his service by putting up an “advertise here, Call Joe @ 415.555.5555? ad (marketing). The companies that call Joe and eventually rent his billboards to promote their goods and services are all marketers.

It seems like a mundane distinction, but it’s an important one for the independents. The current technological revolution, mixed with ample competition, is forcing people to get out of specialization and take responsibility for their success in many avenues. Here are some examples in classic ‘Willis Quick List” fashion:

Willis Quick List #1 – So you don’t agree that specialization is dying?

Tim Ferriss wrote “The 4-hour Work Week” and despite his status as a first time author secured an awesome publishing house. He also took a very active role in supporting the book after he wrote it, and thanks in part to his marketing ability the book became a #1 New York Times Best-Seller. Don’t take my word for it, read his post which says all his success came from “learning how to spread a meme.”
Wallstrip, an internet video show about the stock market, sold to CBS 9 months after it was created for 5 million dollars. I’ve heard Howard Lindzon (the creator) say that the interesting thing was how agile his team had to be. It wasn’t like a television studio with very rigidly defined jobs, with only 3 staff members – everyone was responsible for doing whatever was necessary. CBS has said they acquired Wallstrip because they understood how to make an internet show popular – not because of the content.
Movies like Four-Eye Monsters, are pioneering digital marketing in hopes of standing out from the crowd. And they are succeeding.
So in this day in age, let me tell you what’s become easier than ever: building a distribution channel. Your website is a distribution channel. Your blog, Facebook Group, Youtube Channel, Myspace Page, Email List, Tumbler page, and Twitter account are all small distribution channels. At it’s core, a distribution channel is an communications connection. Now, my point is, the little guy used to have to don a marketer hat and convince one of the bouncers guarding the distribution channel that he should be allowed in. We are now seeing great empowerment for the little guy to learn about these distribution channels and go create them. Would you rather own your distribution channel, a direct line to people you know care about you and what you have to say, or rent another person’s channel?

Let’s try and sit in my friend’s shoes. He’s going to be putting on an event, promoting the heck out of it, selecting winners, making a film of the behind the scenes experience and finally trying to get his film picked up (either by a big distribution house or self-distributed). There are at least 4 very large marketing pushes he’s going to have to do for this (getting contestants, selecting winners, profiling the winner, marketing his film). By using RapOuts to get people engaged around the first goal, he gets awareness around getting contestants. When the time comes around to select winners, odds are that most of the people who cared about selecting the contestants will also care about who wins. Having established the distribution channel to these individuals once before – he can simply change the messaging without having to rebuild the platform or start from scratch. In RapOuts, that means he changes his video and the actions he’d like people to take. To go back to my simplistic analogy, it’s like taking down an ad from a billboard and putting up a new image.

Think like a distributor and you avoid the high costs (time and/or $) of using another’s distribution channel.

This is a working idea, and may include imperfect or wrong information because of my bias, incomplete thinking, or mental drudgery. I welcome any and all comments both affirming and challenging these ideas.

Reflections on Lessons Learned

Just under two months ago I received the news that I, along with 10 of my co-workers, would be laid off. Unlike most I was OK with this as I felt I’d learned an immense amount of knowledge and I had my compensation package to pay rent and bills while I looked for another job. Long story short is I got appendicitis, and later an offer to go back to work for one month. I took it and by the time I had recovered, I was just starting to look for another job. The company offered me a full-time position. No suspense, I took the job. But I’d like to delve into why, and the benefit of working in a challenging environment.Over the 7 months I was at the company pre-layoff I learned an encyclopedias worth of knowledge about sales. I had never held a real sales career, and honestly I found the work dull. Then, relatively early on in my career my manager/mentor was out sick for a few days and I got to delve into the sandbox and close my own accounts. Luckily there was an easy win in there (it certainly wasn’t skill) and I got a taste of what it feels like to sell somebody. It’s an invigorating experience. That taught me the value of sticking through the mundane to get the win, and when I get mad, lazy, bored, or distracted I remember the sale and it refocuses me. I also developed a skill-set, which I refer to as “Bassilisms” in honor of the man who taught me 90% of the skills. I learned that I have a natural aptitude for sales and I refined the first layer of skills.

Now in June, when deciding whether or not to come back I had to weigh many factors: skills I could learn, new experiences I could get, the money I could make, how much I would enjoy my job, etc. I ended up taking the job because I felt as part of a smaller team I would be well positioned to continue refining my skills and that I would have an opportunity to take on new responsibilities if I wanted them. A larger company would have paid me more, but it would have possessed more bureaucracy and would allow me less opportunity to learn new skills. As a 20 year old starting a career and with my goals not lying in working for a larger company, but rather successively smaller ones until I can start my own; I knew learning would be more valuable in the long run then taking the money now.

So the cost benefit of salary versus development has been on my mind a lot as of late and I think the mix is different for everyone. As luck would have it, a former classmate of mine has been tracking his internship in Taiwan via Facebook and eloquently records some interesting thoughts. A lot of them are simple and seem to be common sense, but that’s what most people need reiterated. Everyone knows how to dream, do you know how to systematically go about implementing those dreams? That’s what makes an all-star. Since Facebook is a closed system I will copy some of my favorites here with my reactions below. Alex, you should really write a blog – you have been a compelling writer at least since 2004 (and my guess is longer) and you’re only getting better. Share those thoughts!

Sitting there with the other two new-guys, it really dawned on me how much you get from the first impression. Quite a cliché statement, that, but none the less true. After hearing about the solitariness, the stress, the long hours, the ‘corporate’ side of law, it was very informative to talk to my mentor, Edison about the nature of his work. I ended up asking him straight up if he liked his job. He sorta grinned at me and rambled off a response about what part of the job makes a difference ect … then he advised me that law isn’t a happy profession, but you can still enjoy it.

This is almost word for word my feeling for my sales job. Any job that requires full attention to detail to win a small percentage of battles is usually boring. In law, most commas are going to be in the right place but miss the one wrong placement in the 100 page document and it’s a million dollar mistake. If you program NASA satellites, a missing comma could blow up a MGS satellite. In sales a 10% increase in method could double your sales, or more. Not the same stakes, but the same lesson — being able to take pride in the big win and value your own consistent effort is an important skill to master.

It’s not enough for an attorney to be satisfactory, anything less would be malpractice. Rather, a good attorney must spot future problems that could arise, as well.

Alex goes on to tell a story which I won’t repeat, as he gives an example of a poor choice made by an attorney at a law firm, and I’m not sure about the implied confidentiality of Facebook (it is a closed system). Probably far enough removed, but better safe than sorry. The message is a simple one, “an ounce of prevention is worth a pound of cure” (Ben Franklin), but it’s one worth repeating. In sales you could waste months chasing a customer before realizing you never asked if they could afford it. Low and behold, they can’t. When you “eat what you kill” that inefficiency hurts. If you prepare completely and actively look for problems, they become a lot more manageable. Paraphrasing Alex’s summation of this experience, If you’re lost in a snow storm it’s nice to have your ass covered, but wouldn’t it have been better to have gotten a map and not deal with frostbitten toes?

Note, posted updated quotes July 10, RP’ed to RSS. Original written July 6th.

Facebook Applications: My Take on "The Facebook Problem"

Brad Feld>Fred Wilson>Me

Fred Wilson posted about “The Facebook Problem” in response to Brad Feld’s concern about Facebook’s new Application layer not showing much immediate benefit for those developers building applications.

Brad Says: “In the absence of [ad-revenue sharing], Facebook is going to need to address the “value to the apps developer” quickly, before some of the larger apps vaporize due to the developer saying “I’m not willing to keep paying for servers and bandwidth.” “

Fred Says: “I see a different Facebook problem. Invite overload and application noise. I cannot keep track of all the invites I am getting, both the standard invites and the application invites. And what’s worse, I can’t keep track of all the applications that all of my friends are using.

We all know I am not the Facebook generation. So maybe I am just not capable of dealing with this level of social networking. But I bet that many of the members of the Facebook generation are secretly wishing for the old Facebook where it was more about them and their friends and less about being a social operating system.”

In response to Brad I brought up the success of iLike: 6m total users in 8 mo. More than 4m have come in the last month, most from their facebook application. Their CEO is not worried about monetization. In an interview he said “There’s no way we’d try to fight an uphill battle against what’s best for the consumer. And fortunately, in contrast to the precariously-balanced “Myspace widget ecosystem,” making $ on the FB platform is no harder than making $ on our own site.”

In Response to Fred I drafted a comment, which I shortened and posted to his blog. That comment turned into this post:

I suppose that unfortunately, I’m in the “Facebook Generation,” I have 3 thoughts that may contribute some value to this discussion.

1) I resisted facebook for awhile, thinking it was silly. One of my friends tagged a photo of me and that was enough value to join. I just throw on a “noise” filter and it’s very nice. I can keep up with people I met while traveling in Europe, or from high school, from my hometown, etc. I ignore everything else and after 5 hours I’d found all those I wanted to find. Now all things I want to see get emailed to me (I made plans for tonight and saw a friend was coming home while drafting and proofreading this comment), and management takes very little time. Applications increase the level of information I can see about my friends. Nothing regarding them gets pushed to me though, it’s just there when I seek it out. I like this.

2) Quote Generator, Free Gift, Pets – I agree these are fluff applications with little value other than social interaction for social interactions sake. This helps college kids have sex, it will always exist! BUT, facebook exists as the primary online brand for most of my peers. 10% of my network have websites/blogs (most also have facebook or other social profiles), 75-80% of my network has a facebook or a myspace page. I have a desire to define myself online, so I’m redesigning my website to continue to house my blog and also use widgets to converge all my major online published material and control the presentation of it. Facebook Apps like last.fm, del.icio.us, twitter, etc. are essentially widgets and allow that 80% of my network to exercise similar control over there definition/brand online as those who code their own website/blog. If you doubt the value of widgets to some people, just look at the sidebar of Fred Wilson’s Blog. Of course not all 80% of my network that uses facebook find widgets useful, but more than the 10% that also run personal sites/blogs will have use for widgets. This brings me to my third idea.

3) Facebook users are experiencing an exploratory phase. Most users are not entrenched in the Web 2.0 world, this applications program is arguably the first time many of these users have seen these ideas of widgets (and also the “web2.0” services that are easy to build but don’t actually provide much value — we all know that the vast majority of “web2.0” isn’t useful). Facebook users are doing what all people do when placed in new circumstances, they are exploring. This I say with relative assurance because in just reviewing my notifications – my friends are removing applications just as fast as they are adding them. The quotes, the pets, the “hangouts i like” apps don’t stick around much. The last.fm, twitter, and other “established services” apps don’t get added much but they never get removed (I’m inferring from this that only current users of the services are adding these widgets). The iLike phenomenon is the most interesting, iLike faces a lot of entrenched competition and is still pretty young (8 mo. old). It now says it has between 6 and 7 million users, 3.9m of which have signed on to the facebook app in the last month. More than 4m have joined in the last 30 days. I’ve had many friends add this app and some remove it. It’s my educated guess that most of those friends hadn’t heard of iLike before the application, so everyone who still has the app is a brand new user for iLike. That’s good news for the users that found a useful service and it’s good news for iLike. It would be of interest to see the metrics across the FB network of adding and removing applications. I’m dealing with a limited sample group.

Broad Level Takeaways:

To those who are disappointed with the “noise level” – the info-noise level will continue to be higher than previous levels, but you are now experiencing an exploratory spike which will calm down as people begin to realize what apps are and what they do. The same reason I don’t email my friends when I sign up for a new service just because it asks me to, your friends will learn that they need 3 days to test drive an app before saying they like it. Most will learn to stop notifying you, unless they think it will provide value to you, and in that case wouldn’t you want to hear about it?

To those who think facebook needs to help developers monetize apps: You’re both right and wrong. Facebook benefits in two ways from the applications…
1) Users like me get more information in many ways. Apps like Video and events help address competition with options available on Myspace, without having to alienate anyone who’s not interested in changing their profile or interface. Apps like notes help users publish data for their friends to find if they want to (facebook blogging anyone? “flogging” if you will). Apps like Twitter, Last.fm, Dopplr, etc. mean I don’t have to publish information twice to share it with a wider facet of my network. It also changes how I use these services, normally for the better. Synergistic! This doesn’t require Facebook to help with monetization. Certain developers will take the risk that they can monetize the traffic. Any new app is only an added value to the userbase, and the critical features are built and maintained in-house.

2) The Marketing Playbook (great book; worth the read) details 5 strategies a software company can take. One strategy is the platform play, in which a company gain numerous allies by empowering other companies to survive in an eco-system they create. This could be a powerful move for Facebook. Empowering other developers is a great move, especially when it so perfectly fits into your core business. If they do help companies like iLike succeed and even allow companies to move to FB and turn a profit (like it sounds like iLike may do), then they have something unique, extremely valuable, and a huge win for them.

Thoughts? Responses? Comments!

About the Author

Tyler Willis is the Vice President of Business Development at Unified, which builds enterprise marketing technology for brands and agencies.

This blog is about how the future will affect technology, marketing, and the things we care about most. Learn more about Tyler.

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Tyler is a featured speaker and instructor for The American Marketing Association, and is a popular speaker on topics related to social marketing and how technology is changing our lives.

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Lightweight Update

I write infrequent (quarterly at most), semi-formal updates of what I'm doing and thinking.


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