If HBJ is Right, Perry is in Trouble

A very unscientific poll at Houston Business Journal's website indicates that the governor's reelection chances are looking quite dim. Governor Rick Perry trails Kinky Friedman and Carol Keeton Strayhorn in a poll of Business Journal readers and is barely ahead of the Democrat's Chris Bell.

How bad is it? At the time of this log Perry has 16%, Friedman has 22%, and Strayhorn has a very impressive 45%. Bell follows the pack with 10% and the remaining 4 % is undecided. This should be very disturbing to the governor for several reasons.

First, the average income of an HBJ reader is approximately $100,000.00 a year. An affluent constituency such as this should be in his camp.

Secondly, this group has a larger number of business owners than other publications. Another positive for someone like Perry, one would think.

In other words, this should be a dream constituency for Perry. In fact, if he can't win with this group, there is a good chance he can't win with any.

Why the strong showing for Strayhorn? She has done an excellent job as positioning herself as the most conservative candidate in this race, although that may be doubtful. Furthermore, her strong opposition against (essentially) Perry's expansion of the franchise tax has positioned her as a friend of small business.

I will remind you that this poll is not scientific. Who knows, friends of Strayhorn may have stacked the votes by voting repeatedly. But my gut tells me, this can't bode well for the governor.

Winning the War on Citgo

Recently I posted in this blog the need for Americans to boycott Citgo and 7-11 has already pulled the plug on that relationship. Do you see the power of 1 person? Yes, the convenience store giant claims it had nothing to do with my blog or even the ridiculous speech by the Venezuela's dictator Hugo Chavez calling the President of the United States the devil while speaking at United Nations, but we all know better. The timing couldn't be more obvious.

Okay, I'm sure that my claiming that I convinced 7-11 to walk away from Citgo is as proposterous as Al Gore's claim that he invented the Internet, but it is fun to think I made a difference. You can make a difference too. Say "no" to Citgo. Spread the word.

As the Economy Enjoys Good News, Critics Receive Bad

There is nothing worse than good news to make negative people unhappy. The prophets of doom of the economy eat, drink, and sleep economic woes. When the economy shows weakness in any area, the rest of us slightly hold our breath. These advocates of malaise sigh also, one of relief.

As the 2006 mid term elections come upon us, the need for bad news is more important than ever for those who are hoping for a bad economy and have put their hope in a change of power. If the economy grows, so does the chances of the retention of a Republican majority. We are now down to around 5 weeks. Every bad day really counts. This month has been particularly difficult for those who would hope the worse for us. Two important stories indicate just how bad the situation is for them.

First, consumer confidence has driven up dramatically, much higher than expected. According to the article, the consumer confidence report "released shortly after the start of [stock market] trade, the index rose to 104.5 in the month, topping forecasts for it to rise to about 102.5 from 99.6 in August." Why is this important? It is simple, if confidence is down, so often is consumption. When that is down, so is productivity, employment, etc. This is important most of the time, it is extremely important as we approach an election cycle and the holiday season that begins at Thanksgiving. More than half of non-consumable purchases take place between Thanksgiving and Christmas. How big the final number of purchases are is linked directly to consumer confidence. If consumers are confident about the economy, they will drive that economy in a way that is beneficial for business.

Second, even as I write this article, the Dow is flirting with breaking its previous high and already did briefly this morning. This shows a level of confidence that goes beyond mere consumer hopeful thinking and indicates that many of the fundamentals in measuring an economy are still moving in the right direction.

I know, it is bad news for those who live off of such, but for the rest of us who actually make a living, I'm very pleased with these reports.

Wal-Mart's War on Poverty

I must confess, I'm a news junkie. However, I watch so much that over time it goes in one ear and out the other. However, I recently saw a segment on Fox New's The Beltway Boys that actually caught my attention. Neoconservative hosts Morton Kondrake and Fred Barnes were doing a laundry list on why the Democrats should have several concerns going into November when Barnes pointed out that the Democrats' attack on Wal Mart was going to backfire. He went on to say that, in addition to being the country's largest employer at 1.3 million (many people are reluctant to bite the hand that feeds them), it has actually "done more to eliminate poverty than any government program." Unfortunately, Kondrake's quest to assess the Democrat's dilemna ended Barnes discussion with (paraphrase) "Wal Marts' low prices have made virtually everything more affordable." What an interesting idea and so true. Wal Mart, in its quests for market domination and profit, has made ridiculously low prices a vehicle to raise the income levels of virtually everyone (by, in turn, lowering their costs).

Wal Mart doesn't do it because they like consumers, they do it because they love profits. And as a result, we are the chief beneficiary. Furthermore, competitors with higher prices have been forced out of business (and some social activists would have us cry over them) or have been forced to lower prices, which again consumers benefit.

I liked Barnes comment, I wish he had more time to elaborate. The war on Wal Mart is one of envy, not of public interest. The public interest is widespread employment accompanied by low prices. That's good for business and America.

Does the Internet Really Make Us Smarter?

Back in the 1980s the US economy and, really, the world economy had found itself largely shifting from being industrially driven to information based. This was only accelerated with the dramatic rise of the Internet where "content is king." I have several friends who work in this industry and I hear their concerns every day, they sound like the little robot in the movie Short Circuit, "I need input," is their constant cry.

We are now bombarded with information thanks to the Internet and for most of us it has become a huge one source. Sheer encyclopedia size content waits at our finger tips. We want more, providers want more, but are we any smarter?

From what I can tell most of us are getting much better informed about the things in which we have passion. When I talk to my sports junky buddies, they know statistics about players and games in a way I hadn't seen in the past. When asked how they know something, the answer is the Internet. Same goes with my entertainment junky friends, and their source is the Web as well.

However, I doubt the web is generally making us better citizens or more culturally literate, although it certainly could if we were so inclined. I don't think the web has made us smarter per se, although there is no doubt it has made us more efficient in the way we do many things. It has only made it easier for us to learn more quicker about (in most cases) the few things we have passion about. We have this huge resource out there, I would love to see us use it in a way that makes us smarter and not merely more efficient.

It's Time to Boycott Citgo

It is time to boycott Citgo, because it is time to boycott Hugo Chavez. The Venezuelan thug came into the US and called our President "the Devil." His government solely owns Citgo and that country provides around 15 percent of our oil. It is time we get it somewhere else. I really don't believe I need to go into detail into the case for people holding back on purchasing gas from this monster. He has done an excellent job making that case simply by opening his mouth. I don't care if I completely disagreed with the sitting President, there is no way I support a country whose leader behaved that way. Boycott Chavez. It will be good for America.

The Birth of Modern Public Relations

According to a news release from Business Wire "this year marks the 100th anniversary of Ivy Lee's first press release. Known as the father of public relations, Lee's first press release is considered the birth of the public relations industry as we know it today." Since this time the way information is conveyed has never been the same.

In 100 years we have developed mass media, press secretaries, communications directors, news wire services, and numerous other tools for getting the message out. Some PR efforts are for crisis management, others are in order to get cheap publicity (there are terminologies in the industry, "paid," which is typically advertising and "earned," which is PR), all of them have traditionally been at the mercy of the news media that interprets the stories for the news consumers.

The Internet, however, is increasingly changing this. More and more companies and individual use services like PR Newswire, Business Wire, DBusiness News, and the HoustonBusiness.com Media Room to get the message out, largely unfiltered or manipulated by the media and at a very reasonable cost. It is one more example of the power of the Internet and how it is leaving traditional media in the dust.

Now, it is not at all unusual to put your news release on one of these sites, have someone put a few key words in a search engine, and for the release to turn up on page one of that engine. The information brokers have to be losing a lot of sleep due to the power of the Internet and, more importantly, the power it gives to businesses of all sizes and even individuals.

Ford Employees Learning Economics 101

I know this is going to sound harsh, but the economic realities that Ford employees are discovering are the same lessons everyone must learn in order to thrive in our current economy. During an interview on ABC News Nightline an employee was asked about the cause of the company's decline. She replied it was because Americans selfishly bought foreign cars at the expense of their fellow Americans. The interviewer asked a question that was shockingly perceptive in our current political environment, (paraphrase) "could it be that Americans don't want to pay for the amazing salaries and benefits that you boasted about earlier? Wouldn't they rather pay for the lower cost of buying a car made by Toyota with lower wages and benefits?" (One thing all the Ford employees discussed was how good it was for them financially).

The look on her face was amazing. It was like she had a "V-8" moment, but the negative type, not the one you see in the commercials. She said "the benefits are amazing, but I hate to think that is why they did it." But that is exactly why we -- all of us -- "did it." The economy is a lot of things, but it isn't personal. The invisible hand that Adam Smith discussed in the 18th century is alive and well today. People actively make self interested decisions daily, even as we criticize the ability of other countries in competing against us. The invisible hand, a force we can't see but is all so powerful, creates supply and demand, and controls our economy unless harassed by government.

A great example of this is Wal-Mart. If everyone I talk to about this "job exporting," "people exploiting," "made in the USA destroying" company is telling the truth, this company should be on the brink of bankruptcy and not, arguably, the most economically powerful company in the world. But people, even as they drive to the "hated" store, will decry the injustice of goods made by cheap labor and walk out with not a single item made in the USA (with the possible exception of a tag that was made in a US territory). In essence, they cry all the way to the bank in savings.
Is this a bad thing? Certainly not, in my opinion. Our country has an unemployment of only 4.7 percent, that is virtually zero unemployment when you consider the large number estimated who are voluntarily unemployed (seasonally employed, criminals, etc., equals around 4 percent). Because we are free to get what we want, largely from where we want, we are able to get Ford Escorts for only $14,000 (since they make much of their cars in "cheap labor" countries rather than $60,000 a year (which is what they would likely cost if made bumper to bumper in the US). I'm able to eliminate poverty voluntarily and long term in countries like China and India through my purchases (like we did in Japan 40 years ago) without the United Nations taking my money through redistribution as that organization is attempting to do (leading to corruption and international welfare dependency). We are able to truly take advantage of the law of comparative advantage (things being made were they most make sense economically) and the whole world benefits from it.

I believe people should give up the notion of stopping the imports and embrace them. They are making us richer, not poorer (by the way, our longest period of trade surpluses was during the Great Depression; trade deficits mean we can afford more than other countries; not a bad thing). Instead of grumbling about our imports, we should appreciate the good things we are doing for the world economy and simple common sense with our purchases. We don't make these purchase because they are bad, but because they are good for everyone.

What about the nice Americans who lost their jobs at Ford, GM and other companies? The reality is, most of them will quickly find themselves back on their feet, with either new jobs or created businesses as they pursue becoming their own boss. This loss, though sad, will be temporary, but the American resolve the prosper is permanent.

The US: The World's Biggest Producer of its Most Important Commodity

One of my favorite writers in the 1980s was John Naisbitt, author of Megatrends and several other forward thinking books. In Megatrends I became introduced to the idea that the economy was shifting from the industrial age to the information age. Today, the big complaint of Americans -- particularly older ones -- is that the US doesn't produce anything. No, we have largely left the production of the things we hold, sell, buy, etc. to developing economies that are making those things for us.

In spite of this, the US enjoys among the world's lowest unemployment, continued economic expansion, and per capita incomes that are the world's envy. How has this happened? Because the US is now the world's biggest producer of information. Information is the commodity that makes deals get done, information provides the road map to a more prosperous future, and information is what makes the US the leading economy in the world.

Instead of creating a horror story of huge unemployment because of the jobs we export to developing countries, the information age is only changing the nature of employment in this country. The information age fueled the rise of self check outs that has eliminated low wage jobs at the store, but has created high wage jobs for the people who repair them. Meanwhile, we as consumers pay less for goods because this scenario reduces the costs to the store because the occasional repair is cheaper than the on going checking out.

As long as the US remains a market leader in information, this economy should only continue to grow and prosper. I believe and remain convinced that our best days are yet to come.

New Time, Day for the Houston Business Show

Today marked the new day (Monday) and time (1 PM) of the Houston Business Show on CNN 650. The Houston Business Show is the longest running show on CNN 650 and I'm delighted to be a part of it.

In one hour I visited with an organization expert, a business broker, a private investigator, and the President of the Bank of Houston (Jim Stein, our new Title Sponsor). This show proved to be about the fastest hour in radio. It is interesting that we enter this new chapter just a few weeks before the 5th Anniversary of the radio show.

In the weeks that come I will be interviewing Kent Batman, who was the original co-host of the Houston Business Show; Aubrey Theode who was the longest co-host and who now has a show on KSEV 700; and Mark Jeffrey of UBuildIt who was my most recent co-host and who still makes frequent appearances and has his own show with me on Fridays at 1 PM (the UBuildIt New Home Show). I'll visit with many of the other events that made this a successful show in the weeks to come.

I'm excited by the big changes for the show and to the continued relationship with the station and its audience.

Am I a Prophet of Doom?

Recently I gave, what I thought, was a very optimistic assessment of America's future at one of the many organizations I speak at. When I finished I enjoyed enthusiastic applause and I was happy with the response. However, after I walked from the speakers platform, many people walked up to me and said "you sure do paint a grim picture," "you scared me to death," "I guess there is little hope for my grandchildren," and other words of "encouragement." I scratched my head in confusion and wondered if they had heard the same speech I had delivered.

I spoke about the Megatrends that are changing the world in which we live. These changes are a challenge for us, but challenges we are more than able to overcome and, in fact, they will help us to thrive. The US will not be a victim of globalization, crowdsourcing (the masses competing for jobs held by professionals), or any of the other factors that are leading to the elimination of barriers in the world of business. In fact, we will be the victors.

One of the biggest challenges that have come from the dynamically changing world is the higher gas prices that are a result from demand by countries that were historically under users of energy. The two biggest examples are China and India. Unfortunately, the media has largely failed to point out how both of these countries (as well as Russia, Brazil, and others) have seen dramatic increases in gas consumption. That, more than anything else, has led to the tremendous increase in prices at the pump.

Europeans have faced high gas prices like we have experienced for the last couple of years for decades. What have they done about it? They kept going to the pump, reduced the size of their cars, and got on a bus or train. What have Americans done about it? They have waged a war on gasoline dependence these last couple of years and are moving rapidly towards ethanol, biodiesel, and other alternatives. In the next decade I expect our dependency on foreign oil to be largely behind us and the cost of fuel for vehicles and home to be at lows we haven't seen in years. That's just the American way. It took angry Americans to make this change. We simply rise to the challenge.

Americans are the masters of change. Not only are we seldom victims of it, we are usually the force driving it. When you hear me speak about change, don't worry, we Americans can handle it. And if any of them make us uncomfortable or even cry, it will be on the way to the bank.

Forbes Thinks Highly of Texas

Forbes Magazine recently acknowledged in its first survey of best states for doing business what we here in Houston have known for years -- Texas remains a great place for business. The survey had Virginia as number 1, Texas at number 2, North Carolina at 3, Utah at 4, and Colorado (5) rounding up the top of the list. Why such a positive assessment?

According to the magazine "Texas was among the best when it came to population growth, transportation, tort climate and cost of living...The state also has the largest number of companies with $1 billion in sales at 110."

People continue to come to Texas in droves because of the economy's diversity in industries. Changes in the way people can sue (tort reform) has made Texas a less hostile place for people to conduct business. And although people remain in horror over our traffic situation, the state as a whole offers better roads than its neighbors and even its cities have less congestion than those in other parts of the country.

I use to live in Virginia and it is a truly great state, but when I think of its transportation problems, state income tax, and other issues, I think Forbes may have been off on its math a little. Texas' enormous room for population growth and, I hope, continued commitment to business friendly policies, will have it remain a great place for business. It is certainly number one with me.

Do Not Forget September 11th

It sounds silly, how can we forget? But my daughter pointed out to me that she has gotten the sense that most of us are "forgetting" a little bit more than the year before. We were driving in my car and she said "you know on the first anniversary we were encouraged to wear red, white, and blue, maybe a pin to acknowledge what happened, and things like that. And at school we actually had a special assembly just to remember what happened." She went on to point out that "although we do something every year, it isn't like that first anniversary. The emphasis on this date is getting smaller each year."

I agree. September 11th is one of the most important dates in this country's history. It changed the world in general and the US in particular in a most profound way. It showed the measure of the American Spirit and its ability to bounce back. It demonstrated the value of vigilance as we have not had a similar attack since then because of largely sound security policies. And it should always remind us to never be complacent so we don't find ourselves in such a position again.

For many of us, we had little ones on that date who at the time didn't understand what happened and we probably needed to protect them from such. Don't forget, as they grew older, to consider giving them information so they can join you in being ever mindful of this important day.

We will not likely ever say "Happy September 11th!" to others, because of the nature of the reminder. However, let's not forget to have a thoughtful September 11th and be grateful to those who sacrificed then and who continue to sacrifice around the world for our freedoms.

Spending a Little Time in Tomorrow

I can't believe I'm admitting it, but Wired Magazine is quickly becoming one of my favorite magazines. I never fancied myself as a "computer geek" and wired is much more than the official handbook for that crowd. Wired Magazine is actually a sneak peak into the future.

In recent months I read an excellent article about how Rupert Murdoch is changing the world of information through Internet acquisitions. I also picked up on a concept called "Crowdsourcing" that is going to impact the world in a manner similar to globalization in the 1990s. And I also read about the eventual death of newspapers and how they will be replaced with cheap digital screens that can be rolled up and put in one's back pocket. From it one would be able to read up to the minute news from around the world online. Good bye newspapers.

"Wired" is much more than a tribute to the elements inside of technology. Wired asks the question, am I "wired" into what is going on today and am informed about tomorrow? Wired keeps me connected to now and the rapidly changing tomorrow. It is must reading to everyone, regardless of what they do for a living.

Katie Couric's Big Day

Today was Katie's big day as host of CBS Evening News. She made history by being the first female anchor of the most prestigious and important 30 minutes of news. Yes, I know, that is a lot of hyperbole, but that is the media's position on it, not mine. In reality, evening news is in desperate shape and Katie Couric wearing little to no clothes would not be able to likely save its staggering decline in viewership (by the way she was fully and appropriately dressed). Furthermore, the approach they took with Katie will likely contribute to this media's further decline.

First of all, the new approach is no longer the evening news. It is, instead, a mini version of a news magazine such as 20/20, Primetime Live, or 60 Minutes. Instead of making sure the major news stories were covered in less than 30 minutes, Katie gave Morgan Spurlock of "Supersize Me" fame an opportunity to trash our "divided nation" and to express his opinion that we need to stop operating in extremes in her new "Free Speech" segment. Furthermore she had Thomas Friedman of the New York Times on who discussed how we need to restore the friendly US that much of the world loved and appreciated (and often used as a doormat, but we won't go there). The new format was mildly entertaining, but it wasn't the "Evening News."

Second, it isn't the right approach to reach the typical Evening News viewer. That viewer is 60 years old and likes to hear from older sons (such as Brian Williams and Charlie Gibson) and not necessarily from that "chatty" Couric girl. I'm just talking the typical senior, in my opinion, not necessarily my view. I don't see her surviving long trying to reach the senior crowd. Further, the networks are actually trying to distance themselves from seniors and are trying to pursue the all important Accumulators -- 35 to 55 year olds who largely drive the economy today. Which is exactly why they pursued Katie, who falls in the age group and other parts of that key demographic.

Third, she won't likely reach the Accumulators either. Most of them are doing a lot of things at 5:30, but watching the evening news isn't one of them. They are picking up kids, making meals, taking care of parents, or several other things that have nothing to do with the smiling Katie. This audience is reached now, largely, through the Internet, which allows them to watch the footage they want to watch and see it when they care to see it. In no time the podcast version of the news will have a much larger audience then the TV broadcast, but with the rate evening news is going, that won't be saying much.

I hate to be negative. I actually like Katie and miss her on the Today Show, but I believe this experiment will fail and she will have an audience significantly smaller than she did early each morning on NBC. By the way, the morning shows like Today are about the only viable way to reach the all important Accumulators because they are busy multi tasking and find the background noise of information and the relaxed environment of the program a great way to launch a day. It is sad she left this viable place to reach an audience to go to the largely dead network news. But don't worry, we will likely see her on some other day time show in the not too distant future. Watch out The View!

Cathy Stucker: The Idea Lady

Recently Cathy Stucker of IdeaLady.com interviewed me regarding an educational program she is developing on making money from content. She asked me about the value of developing a radio show and how her audience might profit from such. We spent about an hour thoroughly covering this subject and, if she treats each of her subjects like mine, the user will be getting a great deal for their money. For some, calling themselves an idea person could be interpreted as pure self-promotion or bravado, but the description fits well with Cathy. She has been an incredible resource in the development of this blog, has contributed several articles to the Houston Business Review, and has helped me in other areas, becoming a treasure chest of information. At the end of our discussion on the value of starting a radio show, I concluded she needs to have one herself. Don't be surprised to see that happen. In the interim, I encourage you to check out her web site and take advantage of the huge amount of resources she has available on marketing a business of any size. In the case of Cathy, calling herself the "Idea Lady" is an understatement.

Beware of Lower Gas Prices

That's right, you read correctly. I contend that lower gas prices could mean bad news for the US in the long run. Don't worry, don't think I've become some environmental crazy who wants to force people to drive smaller cars. Rather, I want to drive this economy quicker towards a new era of ethanol as our primary fuel. How does gas prices affect that transformation? Plenty.

According to most energy economists, the reason we haven't had a major shift towards ethanol is because the economics of such hasn't made sense yet. We have had the ability to go towards ethanol for decades, but have never chosen to go there on a large scale. It wasn't because we didn't want to reduce our dependence on nations that are either our enemy or underwrites our enemies, it wasn't because we liked the pollution that gas consuming cars foster, it isn't because we like to see American farms struggle and corn silos remain unnecessarily full, it is because of plain old economics.

According to many experts, $2.50 a gallon is the magic number necessary to lead to make ethanol competitive. If gas prices go below that amount, ethanol can not yet compete. Critics will say that price isn't much to look forward to, but economists will tell you that this still high price is temporary. As an economy of scale is created, the cost of ethanol will drive down and in no time we will see fuel prices like we haven't seen in years and a new level of energy independence.

It is similar to when DVD players first came out costing hundreds of dollars and now you can get them for $30. When the ethanol pumps exist on a large scale (like DVD players now enjoy), so will our economy change. It sounds almost unpatriotic, but I'm in no hurry to see gas prices drop, but that is only because I'm eager to see real energy independence. The short term pain will lead to long term gain.

Excuse Me TV, But I Do Have the Internet

A few years ago Aflac Insurance came up with the clever idea of providing trivia questions that were used as a lure to keep people watching what ever show one was watching. It was a pretty smart innovation of advertising. The way it worked was simple, at the end of a segment of a show -- typically a news program -- they would ask a trivia question that you would have to wait through the break in order to the see the answer. What was once clever is now irritating. Furthermore, it reminds the audience how TV is declining in importance and is being surpassed by the Internet.

Recently I was watching Kudlow & Company on MSNBC and they tried a similar concept. Just before a station break they announced that Secretary of State Condoleezza Rice was no longer the most powerful woman in the world any more according to Forbes magazine. They expected me to sit through the break to wait for the answer as to who replaced her. Do you think I waited? With my faithful notebook computer right next to me I had the answer before the first commercial was over. The world's most powerful woman was now Angela Merkel, Chancellor of Germany, according to the list. By the time the break was over I was no longer watching Kudlow and had found my way to other on-demand news and information from the Internet and could care less about the rest of the program.

Instead of keeping viewers, this form of advertising only made TV seem less relevant and accentuated the importance of the Internet.

Blog Changes

I've been taken to task by friends of mine who say they like what I write, but I'm not writing a blog. Instead, most of the time, I'm writing articles. They said I should do that somewhere else. So, with that, expect to see the transformation of this thing into a true blog. What does that mean?

According to people who clearly know better than me, that means you will see many more entries much more often. I'm going to make every effort to put something on here daily. It isn't that I don't have something to write about, I simply whether if I have enough to write a whole article each time. According to the rules of blogs, I need to change my thinking.

Also, these entries will likely be much shorter. A couple sentences, a few paragraphs, whatever is necessary to get my thoughts "on paper."

Below is my most recent entry and it is on Carolyn of the Apprentice. Between that article and next Friday, you will hopefully see many more items.