Category Archives: Current Affairs

Who are college students today??

Price Roe sent me this fascinating study on college students. It is a detailed survey of 263,710 students at 385 4-year colleges. That’s comprehensive!

The American Freshman: National Norms for Fall 2005
By Sylvia Hurtado & John H. Pryor
(the 2006 study should come out next month)

they have been doing these studies since the mid-sixties and the results and trends are fascinating.

global energy demand increasing

So there was big news today … the Wall Street Journal reported that the International Energy Agency presented a paper to the G-20 meeting in Melbourne on global energy demand. The paper predicted that global energy demand will grow 50% in the next 25 years.

50% sounds like a huge number, but over a 25 year period it means it is only growing 1.63%/year. that number doesn’t sound like it would be insurmountable to deal with. it is much less than the global economy is predicted to grow. couldn’t a potential plan of conversation and new energy sources deal with this increase in demand???

Peter Thiel on saving

Peter Thiel penned a very thought-provoking commentary in Forbes on Americans and their inability to save.

Warning: Save, Save, Save


The grim facts: After peaking at a peacetime high of 15% thirty years ago, the savings rate fell, plunging below 0% last year. Over the same period, the Boomers went from the start of their careers to near the end. All the while, life expectancies grew. You’d expect the savings rate to be trending up, not down.

The nation didn’t stop saving because it finally built a solid nest egg. The median American household has just $37,000 in assets other than a home. Even those closest to retirement have surprisingly little saved–the oldest Boomers have about $180,000 to their credit. That’s nothing to sneeze at, but consider that $180,000 produces an income of just $750 a month.

Peter’s famous quote on the subject is: “The good news is that Americans are living longer. The bad news is that nobody believes the good news.”

health insurance premiums and higher deductibles

I am a huge proponent of HSAs and high deductible plans. They might single-handedly save health care in America.

But when you are getting a high-deductible plan, it pays to get the highest deductible you can get. Here’s the facts:

If you want to get a high-deductible plan in California and you are 30-34, you have two choices with Blue Shield — a $2400 deductible and a $4000 deductible. A $1600 difference (all the other items on the plan are the same). You’d think that the yearly premium would be fairly similar with the 2400 being a bit more expenses – maybe about $200 more. But here is where it gets crazy.

The 2400 dues is $114/mo or $1368/yr

The 4000 dues is $63/mo or $756/yr.

So that means the 2400 Plan is $612 dollars more expensive than the 4000 Plan even though you only get a maximum of $1600 in additional coverage. That is a HUGE premium for that insurance.

So if you are healthy, plan on being relatively healthy the next year, and are financially stable, you’d think it was in your obvious best interest to get the highest deductible possible.

(by the way, this analysis is even more true for car insurance and other types of insurance).

Los Angeles Times endorses Steve Poizner

i rarely blog about politics even though i am passionate about it. but something is newsworthy. My friend Steve Poizner is running for California Insurance Commissioner (one of seven state-wide elected offices in California). Steve is a wonderful man, a dedicated public servant, and someone I think extremely highly of.

Today, the Los Angeles Times endorsed Steve (see full text of the endorsement below). Steve has also been backed by the Oakland Tribune, Sacramento Bee, and other papers. he’s essentially the “good government candidate” in the race (his opponent is the infamous Cruz Bustamante).

if you are in California, I encourage you to consider voting for Steve.

More info at:

Steve Poizner for Insurance Commissioner
Republican entrepreneur is a more competent and reliable consumer advocate than Cruz Bustamante.

October 4, 2006

CALIFORNIA HAS ONLY HAD TWO elected insurance commissioners. First there was Democrat John Garamendi, who was seen as a champion of consumers, and then Republican Chuck Quackenbush, who resigned in disgrace amid allegations he allowed insurance companies to underpay their 1994 Northridge earthquake claims. Prosecutors never filed charges, but after two appointees filled out the term, voters returned Garamendi to the job in 2003.

Now Garamendi is leaving again, and the fight is renewed between consumer advocates — who say the industry is out to cheat customers — and insurance companies, which say regulators don’t understand the market. Garamendi is backing Democratic Lt. Gov. Cruz Bustamante over Republican tycoon Steve Poizner. The twist is that the best choice for consumers, hands down, is Poizner.

The Silicon Valley entrepreneur has solid market credentials, having built a billion-dollar company from a global positioning device that locates cellphone users for emergency operators. He has made reducing insurance fraud a priority, which would protect the industry but also would allow companies to offer lower prices to consumers. He acknowledges that “insurance companies want to own this position” — and he vows not to let them. He has said he’ll defend Garamendi’s auto insurance rate regulations, which put a person’s driving record ahead of where the driver lives. He vows to defend Proposition 103.

He’s credible, and his history shows he’s a man of integrity. He thinks before he acts, a trait exemplified by his careful study of a liberal Democratic Bay Area Assembly district that he almost won, and his equally studious approach to and backing for Gov. Arnold Schwarzenegger’s redistricting reform, a measure that, while unsuccessful, was worthy. The insurance commissioner’s job, he notes, “requires analytical horsepower.” Poizner has it.

Bustamante, as a legislator, often backed bills that insurance companies sought to help them avoid complying with Proposition 103. For example, he advocated the repeal of the initiative’s good-driver discount. When he ran for governor in the campaign to recall Gray Davis, he misused donations from Indian tribes and was heavily fined. As a candidate for insurance commissioner, he accepted insurer contributions, then returned them when it became a campaign issue. It was not a proud day for Democrats when it became clear that he would be their nominee. His election would be a step backward for consumers.

Poizner is no Garamendi; with his market orientation, Poizner is open to permitting lower-premium health policies and other types of coverage with very high deductibles, along with other moves that may not prove popular with consumers. But he is dedicated to making sure insurers are competitive and, where the market falls short, he will be an effective consumer watchdog.

dynasties and American politics

Whill26I’ve been think a lot about dynasties … and I don’t think it is good for America …

Particular the Clintons and the Bushes. If Hillary Clinton wins in 2008 (I would say that is a good possibility) and goes two terms … and then she is followed by Jeb Bush for two terms (another possibility) …

In every presidential election from 1980 – 2020 (or 32 yrs), either a Clinton or a Bush will have been on the winning the presidential ticket. That makes us look like a development nation with a struggling democracy.

Already a Bush or a Dole has been on the Republican presidential ticket since 1976 (28 yrs).
And are we ready for a Chelsea Clinton vs George P Bush in 2032? (they’ll both be about 50 then).

Do we really want presidential politics dominated by just a few families? This isn’t to say that a member of a family dynasty can’t be a good President. It is only to be very wary of concentrated power.

Our founding fathers were very concerned about dynasties. It isn’t coincidence that out of our first five Presidents, only Adams had a son. And Adams was very telling. He was the only one of the first five Presidents to last only one term and, to prove the power of dynasties, his son, John Quincy Adams, became the sixth President.

risk aversion in intelligence analysis

One of the things I have been doing for Rapleaf is talking to people that gather and analyze intelligence. We’re very interested in systems that gather discreet pieces of info and put them together to find patterns and good intelligence.

while talking to intelligence officers (mostly those in the US govt) i found something very interesting: an incredible fear of failure. the fear for a false positive (falsely identifying something) is so incredibly high that these officers err on the side of massive false negatives (in this case, not going out on a limb or being creative).

essentially, they seem highly risk averse … and there seems to be very good reason to be risk averse as a false positive is often a career ending move in many intelligence services (often yielding to career stagnation or even firing).

somehow … and i’m not sure how … we need to reward people for being wrong. and then protect those people. encourage good mistakes (not stupid mistakes — there is a big difference).

of course, i’m not an intelligence expert … but the fear amongst analysts is so pervasive that it MUST be a signal of an endemic problem.

The ‘starfish model’ for the war on terrorism

Ori Brafman and Rod Beckstrom have published an interesting article in the SF Chronicle today on facing and combatting terrorism:

The ‘starfish model’ for the war on terrorism …. How to counter a decentralized foe

i highly recommend reading this. it is from the authors of the new upcoming book Starfish and the Spider.


In the 1980s, headlines told of radicals waging a secret war, of hidden cells and of the FBI’s inability to do anything about them. They weren’t talking about al Qaeda, but about the Animal Liberation Front, which took direct action on behalf of animals (i.e., broke into labs). Some applauded the ALF’s efforts; others condemned them. But the FBI wasn’t able to contain these tofu-eating activists. The more aggressively the ALF was pursued, the more easily it recruited new members.

Like AA, the ALF lacked formal leadership, top-down hierarchy and structure. It was just a loose collection of informal circles linked by common beliefs. But its seemingly chaotic structure made it incredibly resilient to attack. The ALF drew its power from its decentralization.

memories of 9/11

today is a good day to look back and reflect. 9/11 seems like a long time ago to me … much more than five years. yet it also seems like yesterday.

a few days after 9/11, i had an odd and somewhat humorous experience … i was visited by the FBI. the agent was extremely professional and curteous and i’m glad we have people like him helping our country.

back in october 2001 when i was still doing Summation push-style (in an old-school email newsletter), i sent out this summary of my one and only FBI encounter [see original here]:

MY VISIT FROM THE FBI (published October 1, 2001)

On Friday, September 15, just three days after the horrible terrorist attacks, I got an e-mail from my roommate.

“Subject: You had a visitor.”

“A FBI agent just stopped by the house and would like to talk with you. He said he was following up a lead where your name was referenced. I don’t think it is a big deal – he was alone and not super pressed to talk with you.”

“I have his card. His name is XXXX XXXX. His phone number is ####. He will need to talk with you face to face and said he would meet you anywhere in the city.”

I got the e-mail at 2:47 pm and wanting to help in any way I could, I immediately called the FBI agent and left a message. By 3:30 pm he was in my office interviewing me.

He flashed a badge. I’ve never seen an FBI badge before, but this one looked legitimate. He gave me his card. His title: “Special Agent.” He took a seat on my couch. I sat back in my chair.

My first inclination was that this was about one of the many security references I’ve done for former employees of mine that went on to work in sensitive areas of the government. The FBI does background checks on anyone who gets an offer for a sensitive job. Was my friend who used to work for the NSA in trouble? Unlikely. What about the quiet woman who now works for the Justice Department? Who could it be?

Then he pulled out a copy of an e-mail I sent on Sunday, September 9, just two days before the horrible attack. The e-mail was an advanced copy of a future Summation article (will be in next month’s Summation) comparing the Israeli terrorist situation to a fictional scenario in America.

Also, you might remember in the last issue of Summation (see letters below) I wrote a column entitled “U.S. Homeland Security Agency is Unavoidable” (see I wrote this column in July and wrote the paragraph:

“The occurrence of a major terrorist act on U.S. soil within the next ten years is almost a certainty. I’m not just talking about the bombing of the Twin Towers. I’m talking about something more serious, something that would result in the killing of thousands of people, is inevitable. This is the dangerous world we live in.”

I have never been more sad that one of my predictions came true. Of course, my ten year time horizon was far too optimistic. Turns out it was more like 10 weeks.

Read the last Summation — my thoughts which were released just eight weeks before the event seem like they were written today. I guess that’s why I was visited by the FBI Special Agent.

Agent: “Did you have any prior knowledge to Tuesday’s actions?”

Auren: “Absolutely not.”

Agent: “Do you know or have any connection to Osama bin Laden?”

Auren: “No. I’m Jewish.”

Agent: “Do you have a criminal record?”

Auren: “I don’t think so.”

Agent: “Correct — I checked your criminal record. You don’t have a record.”

The interview only lasted 20 minutes and the agent was only following-up on a lead. Normally I’d be mad at someone taking time out of my day to interview me. But I understand he had to interview me that Friday. I’m glad he did — we should follow-up on every lead possible.

I hope we never have a day like September 11th again. Unfortunately, I know another day of terror is going to be extremely difficult to prevent.

Greg Mankiw is my favorite blogger

most of the blogs i read are about technology. or they are written by friends.

but one blog i read for pure pleasure and intellectual stimulation. the one Greg Mankiw writes.

Mankiw is one of the most well-known economists in the world. He is one of the most popular professors at Harvard and a great guy (I have met him only once — we had dinner about a month ago … and i can attest he’s a terrific conversationalist and super-smart). He was the Chairman of the Council of Economic Advisers during the first term of President George W Bush.

and his blog is fantastic and a great read. i highly recommend it.

will our generation ever have a US President??

i wrote this 3.5 years ago back in january 2003 but it came up in a discussion I had recently:


The current President of the United States, George W. Bush, is a boomer. So was his predecessor Bill Clinton. Boomers were born from 1943-1960 and experienced the sixties and Vietnam in their youth and the eighties prosperity/optimism in their rising adulthood. Given that most boomers are just now dominating the political landscape, I expect their generation to be a force for a long time to come.

The generation before the boomers, the Silent Generation (born 1925-1942) never had a president. They still have a few chances – but I expect they never will win the nation’s highest office. People like Dick Cheney, Mike Dukakis, Gary Hart, Walter Mondale, and Colin Powell are all members of the Silent Generation – serious leaders but none of them ever becoming President.

For 32 years (1961-1993), the Presidency was dominated by the generation that preceded the Silents – commonly referred to as the G.I. Generation (or as Tom Brokaw likes to say, “the greatest generation”). Kennedy, Johnson, Nixon, Ford, Carter, Reagan, and Bush 41 all reached young adulthood during World War II. That generation effectively led America through the cold war to its completion.

Because of population trends, I’d argue that the boomer generation has a good chance of doing the same thing and will lead us through the 20-30 year war on terrorism we are now facing.

But were does that leave my generation, Generation X (born 1961-1980)? My generation is saddled right at the bottom of the baby bust. The next generation (the Millennials born from 1981-2002) has experienced one of the largest baby booms in our nation’s history. And though we are represented by people like Congressmen Harold Ford and Devin Nunes, and Senators John Sununu and Norm Coleman, we might never have a President of our own.