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CARICOM calls for innovative ideas to finance SIDS development

Posted on September 18, 2014 in Ethos, Government

Go Lean Commentary

“The pot calling the kettle black” – Old adage

It seems so out of place for Irwin LaRocque, the CEO of the Caribbean Community (CariCom) to lecture other nation-states on how they should restructure their finances, considering the fact that the CariCom organization admits that their own finances are ‘in shambles’.

But still, the purpose of this commentary is to first applaud Mr. LaRocque for identifying better options (in the news article here), and then to direct his attention (and by extension, the entire Caribbean and the rest of the world) to a published ‘better option’ for SIDS financing: the book Go Lean … Caribbean.

Title: CARICOM Secretary-General calls for innovative alternatives to finance SIDS development

APIA, Samoa — Even as the Small Island Developing States (SIDS) examined the issue of financing sustainable development for SIDS in Apia, Samoa, CARICOM secretary-general Irwin LaRocque has suggested the need for new and innovative alternatives.

Moderating a side event titled “Financing for Sustainable Development in SIDS”, during the four-day international conference on Small Island Developing States, LaRocque said there may be a role for innovative public and private financial instruments such as counter-cyclical loans, which temporarily halt existing debt service payments when shocks strike.

He highlighted financing instruments such as the Caribbean Catastrophe Risk Insurance Facility (CCRIF) that provide cash flow support immediately following an insured catastrophe, as well as financing opportunities presented by the recent rise in South-South cooperation.

He stated: “Emerging donors have become increasingly important sources of both aid and loan finance for many Small Island Developing States. This development — which looks set to continue — provides SIDS with important opportunities to secure new and additional sources of development finance, as well as opportunities to learn from other countries’ recent development experiences.”

“It is important to foster greater transparency in such flows, and to ensure that debt sustainability concerns are also kept in view,” the Secretary-General cautioned however.

Continuing on the issue of resource mobilization, LaRocque acknowledged that improving domestic resource mobilization capacities was also important. He informed that several SIDS have established special funds or programmes to channel more domestic resources to environmental and conservation programmes but, despite progress, challenges remain, and for many SIDS, domestic investment will need to be supplemented by international funding given the high up-front costs of many investments.

According to the Secretary-General, financing for development to reach set multilateral development goals required innovating instruments to mobilise domestic and international development funding that involve traditional and non-traditional donors, so as to increase private sector investment and public-private capital flows in support of development.

Noting that the overall financing needs for SIDS were not only large, but were also “very difficult” to quantify based on their level of vulnerability and exposure to external shocks, the CARICOM Secretary-General said that the Caribbean had been plagued with losses equivalent to over one percent of GDP to natural disasters since the early 1960s. He referenced Saint Lucia, St Vincent and the Grenadines, and Dominica in which losses were estimated at US$108 million for St Vincent and the Grenadines and US$99 million for Saint Lucia in December 2013.

He added that while Official Development Assistance (ODA) and climate finance were important sources of funds for many Small Island Developing States, the proportion of overall aid allocated to SIDS was small, on the decline and heavily concentrated in just a few countries. .

“Suffice it to say, more financing will be needed to support not only countries’ long-term development, but also to address sudden major shocks such as the extreme weather events,” he said.

The Secretary-General stressed that the debt challenges facing many SIDS were compounded by the stance of the multilateral financial institutions regarding access to concessional resources by those states classified as middle income developing countries.

“The use of the narrow criteria of per capita gross national income in excess of US$1,035 (in 2013) to confer ‘middle income status’ on developing countries does not take into account the peculiar vulnerabilities, economic fragilities and lack of resilience of many SIDS including those in the Caribbean,” LaRocque also said.

The Caribbean Community had a high-level delegation at the conference which included Freundel Stuart, Prime Minister of Barbados; Dr Keith Mitchell, Prime Minister of Grenada; Dr Denzil Douglas, Prime Minister of St Kitts and Nevis, and ministers of government of CARICOM member states.
———————
The Strategic Plan for Caribbean Community (2015-2019) can be found here: http://caricom.org/jsp/secretariat/caribbean-community-strategic-plan.jsp

The foregoing news article strongly identified the need for public and private financial instruments which are innovative compared to the status quo. This point aligns with the book Go Lean … Caribbean that presents a 370-page roadmap for re-booting, re-organizing and restructuring the economic, homeland security and governmental institutions in the Caribbean region. Government revenue/finance issues are covered in great details in the roadmap; the following is just a sample of some of the innovative government funding/revenue products featured in the book:

Re-insurance sidecars
Marketable Warrants
Tax Liens

The ‘shambled’ state of CariCom has frequently been featured in previous Go Lean blog/commentaries. As sampled here:

https://goleancaribbean.com/blog/?p=1193	EU willing to fund study on cost of not having CARICOM
https://goleancaribbean.com/blog/?p=1014	Jack M. Mintz: All is not well in the sunny Caribbean
https://goleancaribbean.com/blog/?p=816	The Future of CariCom
https://goleancaribbean.com/blog/?p=451	CARICOM Chairman to deliver address on reparations
https://goleancaribbean.com/blog/?p=346	Caribbean leaders convene for CARICOM summit in St Vincent
https://goleancaribbean.com/blog/?p=308	CariCom Agency CARCIP Urges Greater Innovation

The Go Lean book delves into innovative ideas for funding member-states’ treasuries. The book serves as a roadmap for the introduction and implementation of the technocratic Caribbean Union Trade Federation (CU). While federal governments normally bring a new level of governmental overhead and thus a new thirst for public finances, this one is different. The CU pledges to “give, not take”. This pledge is embedded in the Declaration of Interdependence, pronouncing as follows, (Page 12):

xiv. Whereas government services cannot be delivered without the appropriate funding mechanisms, “new guards” must be incorporated to assess, accrue, calculate and collect revenues, fees and other income sources for the Federation and member-states. The Federation can spur government revenues directly through cross-border services and indirectly by fostering industries and economic activities not possible without this Union.

The Go Lean book posits that the “whole is worth more than the sum of its parts”, that from this roadmap Caribbean economies will grow individually and even more collectively as a Single Market. This roadmap advocates the optimization of the economic and security engines and projects that the region’s economy will grow from $378 Billion (2010) to $800 Billion in a 5 year time span. The natural result of this effort is that government revenues can and will grow.

As related in the roadmap, the 3 CU prime directives include the optimization of the economic engines, establishment of a security apparatus to protect the resultant economic engines, and also the improvement of Caribbean governance to support these new engines.

The Go Lean roadmap therefore accepts a mission to re-structure facets of Caribbean governance with these pronouncements at the outset of the book, in the Declaration of Interdependence, as follows (Page 12):

xiii. Whereas all men are entitled to the benefits of good governance in a free society, “new guards” must be enacted to dissuade the emergence of incompetence, corruption, nepotism and cronyism at the peril of the people’s best interest. The Federation must guarantee the executions of a social contract between government and the governed.

The book purports that many of the revenues systems (such as identified above) are too complex for many individual Small Island Development States (SIDS) alone, and so the CU would be better suited to provide the economies-of-scale necessary for efficient deployment. This is part-and-parcel of the technocracy of the CU.

The following details from Go Lean…Caribbean the community ethos, strategies, tactics, implementation and advocacies to deploy efficient and effective government revenue options:

Community Ethos – Lean Operations	Page 24
Community Ethos – Cooperatives	Page 25
Community Ethos – Ways to Improve Sharing	Page 35
Strategy – Customers – Member-State Governments	Page 51
Strategy – Agents of Change – Technology	Page 57
Tactical – Fostering a Technocracy	Page 64
Anecdote – Turning Around the CARICOM construct	Page 92
Anecdote – “Lean” in Government	Page 93
Implementation – Ways to Pay for Change	Page 101
Implementation – Ways to Deliver	Page 109
Implementation – Ways to Foster International Aid	Page 117
Advocacy – Ways to Improve Governance	Page 168
Advocacy – Better Manage the Social Contract	Page 170
Advocacy – Revenue Sources … for Administration	Page 172
Advocacy – Ways to Foster Technology	Page 197
Advocacy – Ways to Foster e-Commerce	Page 198

According to the foregoing news article, there is a preponderance of SIDS to look to the international community for aid. The Go Lean book describes this dependent attitude as “parasite” and instead advocates for change: a more “protégé” approach.

The Go Lean book calls on the Caribbean region to be collectively self-reliant, to act more proactively and responsively for our own emergencies and natural disaster events. This means better, more efficient governance. A previous Go Lean commentary demonstrated how governments can be transformed through technology and efficient deliveries, by highlighting a review of the relevant book by the California Lieutenant Governor and former Mayor of San Francisco Gavin Newsom: Citizenville – How to Take the Town Square Digital and Reinvent Government.

Now is the time for all of the Caribbean, the people and governing institutions, to lean-in for these types of innovative changes described in the book Go Lean … Caribbean. The benefits are too alluring to ignore: dawn of new governing and economic engines… and dawn of new opportunities. With some success, this would simply mean: a better place to live, work and play. 🙂

Download the book Go Lean … Caribbean – now!

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MetroCard – Model for the Caribbean Dollar

Posted on August 20, 2014 in Economics, Planning

Go Lean Commentary

The MetroCard, the New York City Metropolitan Transportation Authority’s (MTA) payment system is the subject of the referenced source appendix below. But this subject is about more than just simple bus/subway tokens, instead this subject refers to a whole eco-system that constitutes an electronic payment scheme. This system generates $4 billion (2012) and services the transit needs of 15.1 million people. The MTA drives the NYC regional economy, the largest in the US, facilitating the connection for many to traverse from home to work; then after work, the MTA network enables the NYC metropolitan area (New York, New Jersey, and Connecticut) to get to a host of leisure activities: music, theater, cultural events, sports, and shopping. MetroCard is therefore a de facto currency for this region to live, work and play.

MetroCard is a digital currency and not “hard money”, so there are not paper stock or coinage issues to be managed with this approach. (MetroCard replaced the previous ubiquitous tokens in 2003). This attribute relates to the effort to re-boot and optimize the Caribbean regional economy and society. The book Go Lean…Caribbean points to NYC as a model and source of many lessons that the Caribbean can learn and apply, especially related to the adoption of the regional currency, the Caribbean Dollar (C$).

The book Go Lean…Caribbean serves as a roadmap for the introduction and implementation of the Caribbean Union Trade Federation (CU) and the Caribbean Central Bank (CCB). This Go Lean roadmap has 3 prime directives:

Optimization of the economic engines in order to grow the regional economy to $800 Billion & create 2.2 million new jobs.
Establishment of a security apparatus to protect the resultant economic engines.
Improve Caribbean governance to support these engines.

The Caribbean Central Bank has the role of heavy-lifting in the facilitation of the electronic payments modes of the Caribbean Dollar. While the traditional central banking role of currency/coinage distribution do not come into play, with the e-Payment schemes, there are still many responsibilities and benefits for central bank command-and-control. This refers to the subject of M1 monetary supply. M1 refers to the measurement of the total of currency/money in circulation (M0) plus overnight bank deposits (like demand deposits, travelers’ checks & other checkable deposits). So when digit currencies, as MetroCard, are factored in, there is no M0, but an increase in M1. As M1 values increase, there is a dynamic in the regional banking system that creates money “from thin-air”; this is referred to as the money multiplier. The more M1 money in the system, the more liquidity for investment and development opportunities.

The Caribbean needs this increase in development capital/liquidity.

This subject of electronic payment systems has been previously covered in Go Lean blogs, highlighted here in the following samples:

https://goleancaribbean.com/blog/?p=1350	PayPal expands payment services to 10 markets
https://goleancaribbean.com/blog/?p=906	Bitcoin needs regulatory framework to change ‘risky’ image
https://goleancaribbean.com/blog/?p=528	Facebook plans to provide mobile payment services
https://goleancaribbean.com/blog/?p=360	How to Create Money from Thin Air

This Go Lean/CU/CCB roadmap looks to employ electronic payments / virtual money schemes to impact the growth of the regional economy. There are two CU schemes that relate to this MetroCard structure:

Cruise Passenger Smartcards – The Go Lean roadmap posits that the cruise industry needs the Caribbean more than the Caribbean needs the industry. But the cruise lines have embedded rules/regulations designed to maximize their revenues at the expense of the port-side establishments. The CU solution is to deploy a scheme for smartcards that function on the ships and at the port cities (Page 193).
e-Commerce Facilitation – The Go Lean roadmap defines that the Caribbean Dollar (C$) will be mostly cashless, an accounting currency. So the Caribbean Central Bank (CCB) will settle all C$ electronic transactions (MasterCard-Visa style or ACH style) and charge interchange/clearance fees (Page 198). This scheme allows for the emergence of full-throttle e-Commerce activities.

Overall, stewardship of the single market economy and single regional currency was envisioned and pronounced early in the Go Lean roadmap with this Verse XXIV (Page 13) of the Declaration of Interdependence, with these words:

Whereas a free market economy can be induced and spurred for continuous progress, the Federation must install the controls to better manage aspects of the economy: jobs, inflation, savings rate, investments and other economic principles…

New York City is a great model for this Caribbean empowerment effort to look, listen, and learn. The same as tourism is the primary economic driver in the Caribbean (80 million visitors), NYC also plays host to 25 million visitors annually. Many NYC tourists ride the MTA public transportation modes and have to acquire a MetroCard – many times, they leave unspent balances to just sit there. What becomes of those monies? See this news article here:

Unspent MetroCard Money Means Millions for M.T.A.

(http://www.nyctransitforums.com/forums/topic/43954-unspent-metrocard-money-means-millions-for-mta/)

Think of it as New York’s biggest sock drawer, except that instead of nickels, dimes and quarters, what is squirreled away in its dark recesses are millions of lapsed yellow-and-blue MetroCards with digital loose change still dangling from their magnetic strips.

In the decade ending in 2010, nearly $500 million worth of unspent balances on expired bus and subway MetroCards accumulated, and that money can no longer be redeemed.

Cards that are bought, never used but still valid are counted for bookkeeping purposes as a liability, because they might eventually be used. Outdated cards with pending balances become an asset after they expire, about two years from the date of sale. The balances are listed as revenue under the category of “fare media liability.”

Tens of millions of dollars a year may not seem like much out of $4 billion in annual MetroCard revenue for New York City Transit, but there is no stream of cash that the agency scoffs at.

Kevin Ortiz, a spokesman for the Metropolitan Transportation Authority, which includes the transit agency, said: “Expired card value does benefit the M.T.A. It gets counted as fare box revenue.”

The peak year for replenishing New York City Transit’s fare media liability account was 2012, when $95 million was credited. That followed a surge in purchases in 2010, before a fare increase. Those cards, many presumably with outstanding balances, have expired.

Considering the governance for the MetroCard, the MTA has been described with some adjectives of efficiency and effectiveness. Their website described their charter as follows:

While nearly 85 percent of the nation’s workers need automobiles to get to their jobs, four of every five rush-hour commuters to New York City’s central business districts avoid traffic congestion by taking transit service – most of it operated by the MTA. MTA customers travel on America’s largest bus fleet and on more subway and rail cars than all the rest of the country’s subways and commuter railroads combined.

This mobility helps ensure New York’s place as a world center of finance, commerce, culture, and entertainment, and New York ranks near the top among the nation’s best cities for business, Fortune magazine has written, because it has “what every city desires. A workable mass transit system.”

MTA mass transit helps New Yorkers avoid about 17 million metric tons of pollutants while emitting only 2 million metric tons, making it perhaps the single biggest source of greenhouse gas (GHG) avoidance in the United States. The people living in our service area lead carbon-efficient lives, making New York the most carbon-efficient state in the nation.

Over the past two decades, the MTA has committed some $72 billion to restore and improve the network so that today it runs at unprecedented levels of efficiency. Our employees at all of our agencies work diligently to maintain high service and safety standards.

(Source: Retrieved August 19, 2014 from: http://web.mta.info//mta/network.htm)

The governance for the MetroCard may be in good hands, a technocratic reflection. Creating a technocratic CU/CCB governance is “Step One, Day One” in the Go Lean roadmap. Implementing this allows for rock-solid monetary integrity for local financial systems, providing the foundation so the regional society can be elevated, economically and governmentally. In this vein, we examine specific lessons & applications in consideration of the MetroCard business model in the Appendix below:

MetroCard Facts	Go Lean *book considerations/reflections (actual Page* Numbers)**
MetroCard History	Roadmap with Project Delivery Obligations (Page 109); Fostering a Technocracy (Page 64)
Multiple Jurisdictions	Confederation of 30 Member-States (Page 45); Fostering Interstate Commerce (Page 129)
Pricing/Cost Increases	Unified Command & Control on Inflation (Page 153)
Technology	Foster Technology (Page 197); e-Commerce (Page 198); Bridging Digital Divide (Page 31)
Transfers	People respond to economic incentives (Page 21)
Card type consideration – Pay-Per-Ride cards	Improve M1 by encouraging stored balances (Page 198)
Card type consideration – Student cards	Facilitation Education (Page 159) and Transportation (Page 205)
Card type consideration – Disabled/Senior Citizens	Improve Elder-Care (Page 225) and Impact Persons with Disabilities (Page 228)
Purchase Options – Subway Station Booths	Manage Federal Civil Servants (Page 173)
Purchase Options – Vending Machines	Foster Technology (Page 197); e-Commerce (Page 198); Bridging Digital Divide (Page 31)
Purchase Options – Neighborhood Merchants	Help Entrepreneurship (Page 28); Impact Main Street (Page 201);
Future	Impact the Future (Page 26)
Bad Actors: Fraud/Scams	Bad Actors Emerge – Reduce Crime (Page 178); Impact the Greater Good (Page 37)

The Go Lean book details additional community ethos, strategies, tactics, implementations and advocacies to foster electronic payment systems, and the unified command & control necessary for its success:

Community Ethos – Money Multiplier Principle	Page 22
Community Ethos – Lean Operations	Page 24
Community Ethos – Cooperatives	Page 25
Tactical – Separation of Powers – Central Banking	Page 73
Implementation – Assemble Central Bank Cooperative	Page 96
Planning – Lessons Learned from New York City	Page 137
Anecdote – Caribbean Currencies	Page 149
Advocacy – Ways to Mitigate Black Markets	Page 165
Advocacy – Ways to Impact Public Works	Page 175
Advocacy – Ways to Foster Cooperatives	Page 176
Advocacy – Reforms for Banking Regulations	Page 199
Advocacy – Ways to Impact Urban Living	Page 234
Appendix – New York City Economy Details	Page 277

Now is the time for all of the Caribbean, the people and governing institutions, to lean-in for the empowerments described in the book Go Lean … Caribbean. We can all benefit by studying and modeling the successes of New York City!

Any visitor to the city quickly realizes how unique this jurisdiction is compared to other urban areas in the US, or the world for that matter. Millions of people (31,483,000 according to 2010 census) live in a limited congested area that is the Greater Tri-State area, yet there is a recognizable level of efficiency – some technocratic deliveries. For example, NYC does not have the proliferation of yellow school buses that dot the landscape of most American communities. Most students in the city rely on the MTA, funded by their MetroCard, to get back and forth for school. So in effect, MetroCard services the full community needs to live, work, learn and play.

MetroCard is truly a model for the Caribbean … Dollar.

Download the book Go Lean … Caribbean – now!

————————————————————————-

Appendix – Reference Source:

MetroCard – New York Metropolitan Transportation Authority’s Payment System

The MetroCard is the payment method for the New York City Subway rapid transit system; New York City Transit buses, including routes operated by Atlantic Express under contract to the Metropolitan Transportation Authority (MTA); MTA Bus, and Nassau Inter-County Express systems; the PATH subway system (an entity of the Port Authority of New York & New Jersey); the Roosevelt Island Tram; AirTrain JFK; and Westchester County’s Bee-Line Bus System.

The MetroCard is a thin, plastic card on which the customer electronically loads fares. It was introduced to enhance the technology of the transit system and eliminate the burden of carrying and collecting tokens. The MTA discontinued the use of tokens in the subway on May 3, 2003, and on buses on December 31, 2003. The MetroCard is managed by a division of the MTA known as MetroCard Operations and manufactured by Cubic Transportation Systems, Inc.

History

01Jun1993	MTA distributes 3,000 MetroCards in the first major test of the technology for the entire subway system and the entire bus system.
06Jan1994	MetroCard live testing with compatible turnstiles at select lines and stations.
15May1997	The last MetroCard turnstiles were installed by this date, and the entire bus and subway system accepted MetroCards
04Jul1997	First free transfers available between bus and subway at any location with MetroCard.
01Jan1998	Bonus free rides (10% of the purchase amount) were given for purchases of $15 or more.
04Jul1998	Unlimited Ride MetroCards introduced, at $17 for 7 days, $63 for 30 days, Express Bus Plus for $120.
01Jan1999	1-Day Fun Pass was introduced: unlimited use for one day for $4.
25Jan1999	The first MetroCard Vending Machines installed.
13Apr2003	Tokens/coins no longer sold.
04May2003	Tokens only accepted as a $1.50 credit towards the $2 MetroCard ride.
02Mar2008	A new 14-day unlimited-ride was introduced for $47
30Dec2010	1-Day Fun Pass and the 14-Day Unlimited Ride MetroCards discontinued.
20Feb2013	Cards can now be refilled with both time and value.
03Mar2013	A $1 fee is imposed on new card purchases in-system

Pricing/Cost increases – since the complete cut-over in 2003

Date	Daily	Weekly	Monthly
04May2003	$2	$21	$70
27Feb2005	$2	$24	$76
02Mar2008	$2	$25	$81
28Jun2009	$2.25	$27	$89
30Dec2010	$2.25	$29	$104
19Dec2012	$2.50	$30	$104

Technology

During a swipe, the MetroCard is read, re-written to, then check-read to verify correct encoding.

Each MetroCard stored value card is assigned a unique, permanent ten-digit serial number when it is manufactured. The value is stored magnetically on the card itself, while the card’s transaction history is held centrally in the Automated Fare Collection (AFC) Database.

When a card is purchased and fares are loaded onto it, the MetroCard Vending Machine or station agent’s computer stores the amount of the purchase onto the card and updates the database, identifying the card by its serial number. Whenever the card is swiped at a turnstile, the value of the card is read, the new value is written, the customer is let through, and then the central database is updated with the new transaction as soon as possible. Cards are not validated in real time against the database when swiped to pay the fare. The AFC Database is necessary to maintain transaction records to track a card if needed. It has actually been used to acquit criminal suspects by placing them away from the scene of a crime. The database also stores a list of MetroCards that have been invalidated for various reasons (such as lost or stolen student or unlimited monthly cards), and it distributes the list to turnstiles in order to deny access to a revoked card.

MetroCard keeps track of the number of swipes at a location in order to allow those same number of people to transfer at a subsequent location, if applicable. The MetroCard system was designed to ensure backward compatibility, which allowed a smooth transition from the old (blue) format to the (gold) format.

Cubic later on used the proprietary MetroCard platform to create the Chicago Card, which is physically identical to the MetroCard except for the labeling.

Transfers

MetroCards allows for transfers (within two hours of initial entry) among the many transportation modes – incentivizing a preferred behavior. (Pricing rules are built into the system for upgrades like Express Buses, PATH, and JFK Airport AirTrain).

One free transfer from:

subway to local bus
bus to subway
bus to local bus
express bus to express bus
bus or subway to Staten Island Railway
subway to subway

Card type – consideration – Pay-Per-Ride MetroCards

$5 – $80 initial value in any increment (though vending machines only sell values in multiples of 5 cents).
Card purchases or refills equal to or greater than $5 receive a 5% bonus (ex. $50 buys 21 rides).
Cards can be refilled up to $80 in one transaction and up to a total value of $100.
Though cards expire, the balance may be transferred to a new cards.

Card type – consideration – Student MetroCards: NYC does not have the propensity of yellow school business as other communities, therefore a partnership is forged between school districts and MTA.

MetroCards are issued to some New York City public and private school students allowing discounted access to the NYC Transit buses and trains, depending on the distance traveled between their school and their home. The card program is managed by the NYC-DOE Office of Pupil Transportation.
In Nassau County, Student MetroCards are issued by individual schools which have pre-paid for the cards.

Card type – consideration – Disabled/Senior Citizen Reduced-Fare MetroCards

Given to senior citizens and the disabled as a combination photo ID and MetroCard.
Allows half-fare within the MTA system. (Express Bus during off-peak hours only)
Half fare is also available on the 7-day and 30-day Unlimited MetroCards.
Card back is color-coded to match gender of card holder.
Card face is marked as “Photo ID Pass”

Purchase options

All new MetroCard purchases are charged a $1 fee, except reduced fare customers and those exchanging damaged / expired cards.

Subway Station Booths

Booths are located in all subway stations and are staffed by station agents. Every type of MetroCard can be purchased at a booth with the exception of the SingleRide ticket, and MetroCards specific to other transit systems (PATH, JFK Airtrain). All transactions must be in cash.

MetroCard Vending Machines

MetroCard Vending Machines (MVMs) are machines located in all subway stations and transit centers. They debuted on January 25, 1999 and are now found in two models. Standard MVMs are large vending machines that accept cash, credit cards, and debit cards and are in every subway station. Cash transactions are required for purchases of less than $1, and they can return up to $8 in coin change. There are also smaller versions of these machines that only accept credit and ATM/debit cards. Both machines allow a customer to purchase any type of MetroCard through a touch screen. The MVM can also refill to previously issued cards. PATH fare vending machines can also dispense MetroCards.

The machines are compliant with the Americans with Disabilities Act of 1990 through use of braille and a headset jack.

Neighborhood MetroCard Merchants

MetroCards can be sold by retail merchants not affiliated with MTA. Vendors can apply to sell MTA fare media at their businesses. Only presealed, prevalued cards are available, and no fee is charged.

Future

In 2006 the MTA and Port Authority of NY/NJ announced plans to replace the magnetic strip with smart cards.

On July 1, 2006, MTA launched a six-month pilot program to test the new “contact-less” smart card fare collection system, initially ending on December 31, 2006 but extended until May 31, 2007. This program was tested at all stations on the IRT Lexington Avenue Line and at four stations in the Bronx, Brooklyn and Queens. The testing system utilized Citibank MasterCard’s PayPass keytags. This smart card system is intended to ease congestion near the fare control area by reducing time spent at paying for fare. MTA and other transportation authorities in the region say they will eventually implement system-wide.

Beginning October 7, 2012, MetroCard vending machines scattered throughout Manhattan dispensed something other than the classic blue and gold MetroCard. The MTA has begun to sell advertisement space on the front and back of the card to raise additional revenue. The 2012 ad appearing on the cards was purchased by The Gap [retail stores] and reads: “Be Bright NYC” with multicolored letters on a navy blue background. It encourages New Yorkers to visit Gap’s newly remodeled flagship store at 34th Street and Broadway starting October 10, 2012. Customers who present the MetroCard at any Gap store were entitled to a 20% discount on merchandise purchases through November 18, 2012. The MTA has been running advertisements on the back of MetroCards since its inception, earning advertiser fees along with expired card value (accruing when purchased fares wind up not being used on a card deemed a collectible by fans). Deals were arranged as early as 1997. However, this Gap deal is the first time the front of the cards have changed in over 10 years. Approximately 10% of the MetroCards sold throughout the system in a typical month will carry the Gap advertising. Future MetroCard advertising campaigns will include the word “MetroCard” on the back of the card, flush right in the white space above the zone available for advertising.

Bad Actors: Fraud and Scams

The MetroCard system is susceptible to various types of frauds, perpetrated by con artists. Usually these frauds involve the con artist preventing or dissuading the commuter from using his or her own MetroCard, and then charging the commuter for entry to the system (entry is gained by a method that costs the con artist nothing).

Also, MetroCard Vending Machines are programmed to disable the bill or coin acceptor after a series of rejected bills or coins, which can result in a row of MVMs all saying “No Bills” or “No Coins”.

If a con artist is not using a stolen or broken card, he or she can use an array of unlimited cards. Multiple cards are needed because of the 18-minute delay between each swipe at the same station. Using unlimited cards, a con artist is able to sell rides for $1 instead of $2.

A report from New York State Senator Martin J. Golden claims this scam is costing the MTA $260,000 a year, and some con artists are making up to $800 a day executing it. All aspects of this scam have been recently prohibited by MTA policy and a New York State law.

The introduction of MetroCards did eliminate one class of criminals. When the NYC subway still used tokens, token suckers would steal tokens by jamming turnstile coin slots, waiting for unsuspecting passengers to deposit tokens (only to discover that the turnstile did not work), then returning to suck out the token. The retirement of tokens in 2003 put the token suckers out of commission.

The MetroCard does have a magnetic stripe, but both the track offsets and the encoding differ from standard Magstripe cards. It is a proprietary format developed by the contractor Cubic. Off-the-shelf reader/writers for the standard cards are useless, and even hypothetically could work only with both physical and software modification. Some have had partial success decoding it using audio tape recorder heads, laptop sound cards, and custom Linux software.
Source: Wikipedia Online – encyclopedic source; retrieved 08/18/2014 from: http://en.wikipedia.org/wiki/MetroCard_(New_York_City)

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The Crisis in Black Homeownership

Posted on August 5, 2014 in Economics, Social

Go Lean Commentary:

The United States of America has been the best economic manifestation in the history of mankind, (as declared in the book Go Lean…Caribbean Page 67), yet the experience has not been the same for all of its citizens. This definitely applies to the “black and brown” populations. The Caribbean Diaspora fits this classification and their experience fits 100% to the events related in the below news article.

The US is the “land of the free and the home of the brave”, but some restrictions apply. This reality is not new, as racial disparities have long existed in the history of America. But after a major social revolution in the 1960’s, positive change came to American minorities, following by decades of progress.

Then 2008 happened …

That year saw the crisis of the Great Recession where American society lost $11 Trillion in net worth; then later regained $13.5 Trillion; (Go Lean book Page 69). According to the foregoing article, the Great Recession losses were not evenly distributed; nor was the subsequent recovery – those who lost the net worth (Middle Class) were not the ones who recovered (One Percent).

How the recession turned owners into renters and obliterated Black American wealth.

By: Jamelle Bouie

In 2005, three years before the Great Recession, the median black household had a net worth of $12,124. Yes, this was far behind the median white household—which had a net worth of $134,992—but it was a huge improvement from previous decades, in which housing discrimination made wealth accumulation difficult (if not impossible) for the large majority of African-American families.

By the official end of the recession in 2009, median household net worth for blacks had fallen to $5,677—a generation’s worth of hard work and progress wiped out. (The number for whites, by comparison, was $113,149.) Overall, from 2007 to 2010, wealth for blacks declined by an average of 31 percent, home equity by an average of 28 percent, and retirement savings by an average of 35 percent. By contrast, whites lost 11 percent in wealth, lost 24 percent in home equity, and gained 9 percent in retirement savings. According to a 2013 report^[a] by researchers at BrandeisUniversity, “half the collective wealth of African-American families was stripped away during the Great Recession.”

It was a startling retrenchment, creating the largest wealth, income, and employment gaps since the 1990s. And, if a new study^[b] from researchers at CornellUniversity and RiceUniversity is any indication, these gaps are deep, persistent, and difficult to eradicate.

In the study, called “Emerging Forms of Racial Inequality in Homeownership Exit, 1968–2009,” sociologist Gregory Sharp and demographer Matthew Hall examine the relationship between race and risk in homeownership. Simply put, African-Americans are much more likely than whites to switch from owning homes to renting them.

“The 1968 passage of the Fair Housing Act outlawed housing market discrimination based on race,” explained Sharp in a press release. “African-American homeowners who purchased their homes in the late 1960s or 1970s were no more or less likely to become renters than were white owners. However, emerging racial disparities over the next three decades resulted in black owners who bought their homes in the 2000s being 50 percent more likely to lose their homeowner status than similar white owners.”

This wasn’t a matter of personal irresponsibility. Even after adjusting for socio-economic characteristics, debt loads, education, and life-cycle traits like divorce or job loss, blacks were more likely to lose their homes than whites.

If you’re familiar with American history and housing policy, this shouldn’t come as a surprise. The explicit housing discrimination of the mid-20^th century has left a mark—arguably a scar—on the landscape of American homeownership. The combination of red-lining, block-busting, racial covenants, and other discriminatory measures means that, even now, a majority of blacks live in neighborhoods with relatively poor access to capital and mortgage loans. What’s more, this systematic discrimination has left many black households unable to afford down payments or other housing costs, even if loans are available.

And in the event that black households are able to save and afford a home, they aren’t as financially secure as their white counterparts. To wit, middle-class African-Americans are more likely to belong to the lower middle class of civil servants and government workers—professions that, in the last five years, have been slashed as a consequence of mass public-sector downsizing^[c]. All else being equal, a black schoolteacher who loses her job to budget cuts is less likely to have savings—and thus a safety net—than her white counterpart.

But this isn’t just a story of legacies and effects. In addition to showing the consequences of past discrimination, Sharp and Hall argue that African-Americans have been victimized by a new system of market exploitation. Banks like Wells Fargo steered^[d] blacks and other minorities into the worst subprime loans, giving them less favorable terms than whites and foreclosing on countless homes. In a 2012 lawsuit^[e], the ACLU and National Consumer Law Center alleged that the now-defunct New Century Financial, working with Morgan Stanley, pushed thousands of black borrowers into the riskiest loans, leaving many in financial ruin. As early as 2005, the Wall Street Journal reported^[f] that blacks were twice as likely to receive subprime loans. And in a New York University study published last year^[g], researchers found that black and Hispanic families making more than $200,000 a year were more likely to receive subprime loans than white families making less than $30,000.

Together, all of this means that—according to Sharp and Hall—African-Americans are 45 percent more likely than whites to lose their homes. That means they’re more likely to lose their accumulated wealth and to slide down the income ladder, and less likely to pass the advantages of status and mobility to their children.

Apropos of that observation, recent data from the Bureau of Labor Statistics^[h] shows an incredible level of youth unemployment for blacks and Latinos. More than 21 percent of African-Americans aged 16 to 24 are out of work, compared with a national average of 14.2 percent. For black teenagers in particular, joblessness soars to nearly 40 percent. It’s a catastrophe with serious economic consequences. The Center for American Progress estimates^[i] that the young adults who experienced long-term unemployment during the worst of the recession will lose more than $20 billion in earnings over the next 10 years. And given the slow recovery, odds are good they’ll never recover those lost earnings.

It’s tempting to treat these as subsets of broader problems: poor assistance to homeowners and too much austerity. But they’re not. Even during the boom economy of the 1990s, black employment lagged behind the national average. And the racial wealth gap is a persistent fact of American life.

Likewise, the challenges of black homeownership are a function of discriminatory housing policy^[j], as are a whole host of other problems, from mass incarceration and overly punitive policing to poor air quality^[k] and food access. These challenges are heavily location-dependent, which is another way to say they are heavily racialized and most prevalent in the segregated, working-class or low-income communities that characterize life for most African-Americans^[l], even those with middle-class incomes.

For reasons both political and ideological, it’s nearly verboten in mainstream conversation to argue that racialized problems require race-conscious solutions. Knowing what we know about the demographics of foreclosures, for example, we should ensure any program to help underwater homeowners includes a specific measure to assist black victims of predatory lending, who may need additional help to get on sure footing.

For more than anyone else, this is a message for liberals and progressives, who—for all of their racial sensitivity—are still reluctant to tackle the economic dimensions of racism, even as they represent the vast majority of nonwhite voters and draw critical support from African-American constituencies. It’s how Elizabeth Warren could give “11 Commandments for Progressives” ^[m] —and receive huge applause—without mentioning the deep problems of racial inequality. One of her commandments is “that no one should work full-time and still live in poverty, and that means raising the minimum wage.” But solving this problem for African-Americans and Latinos—who tend to live in areas that are segregated from job opportunities—is very different than solving it for whites.

While conservatives and Republicans can play a role here, it’s Democrats who are committed to reducing income inequality and bringing balance to our lopsided economic system. Success on those fronts requires a return to race-conscious policymaking, from programs to increase the geographic mobility of low-income workers—relocation grants for individuals or transportation grants for communities with a spatial mismatch between jobs and housing—to public works programs aimed at low-income minority communities, to race-based affirmative action as a way to boost a flagging black middle class.

There’s little in American life that escapes the still-powerful pull of past and present racism, and effective policymaking—to say nothing of effective problem-solving—requires a response to that racism. Otherwise, we entrench the same disparities for a new generation.

——–

Jamelle Bouie is a Slate staff writer covering politics, policy, and race.
The Slate – Daily Magazine for the Web – Posted 07-24-2014; retrieved 08-04-2014
http://www.slate.com/articles/news_and_politics/politics/2014/07/black_homeownership_how_the_recession_turned_owners_into_renters_and_obliterated.html

The points of this foregoing article aligns with the Go Lean book and the collection of blogs/commentaries. The book posits that the crisis persists for the Caribbean and their Diaspora in North America and Europe. What’s more, this movement asserts that this crisis, any crisis, is a terrible thing to waste.

The Caribbean Diaspora have fled their Caribbean homelands over past decades in search of better economic opportunities. It is now the conclusion that many of these “lands of refuge” are rigged in favor of certain ethnic groups; those groups do not include the “black and brown” of the Caribbean. This commentary has relayed, repeatedly, that this Caribbean-bred demographic can do better at home … in the Caribbean. The following are related previous posts:

Unfortunately for the Caribbean, this societal abandonment has continued. Analysis by the Inter-American Development Bank asserts that the Caribbean continues to endure a brain drain of 70% among the college educated population; (https://goleancaribbean.com/blog/?p=1433).

This blog entry depicted how the Caribbean Diaspora that fled to Great Britain has not fared well; (https://goleancaribbean.com/blog/?p=1683)

In addition to economics, there is the concern for security and justice. This blog entry (https://goleancaribbean.com/blog/?p=546) related the dual standards of justice in the US, where all men are treated as equals (wink-wink), just some are more equal than others.

Yes, as the old adage relates: “the grass is not greener on the other side”. See this VIDEO here (Part 1 of 2):

(Click on first continuation video for Part 2 of 2 or click here: https://www.youtube.com/watch?v=gOS3BBmUxvs)

The assertion of the book Go Lean…Caribbean is that once the proposed empowerments are put in place, the Caribbean Diaspora should consider repatriating to their ancestral homelands.

Social Scientists maintain that when animals/mammals are confronted with threats, they have to choose between (stand and) fight or flight. For 50 years, the Caribbean citizens have defaulted to flight. Change has now come to the Caribbean. The book Go Lean…Caribbean serving as a roadmap for the introduction and implementation of the technocratic Caribbean Union Trade Federation (CU), hereby presents “stand and fight” options. This roadmap will spearhead the elevation of Caribbean society. The prime directives of the CU are presented as the following 3 statements:

Optimization of the economic engines in order to grow the regional economy & create 2.2 million new jobs at home.
Establishment of a security apparatus to protect the resultant economic engines.
Improve Caribbean governance to support these engines.

The book posits that the improved conditions projected over the 5 years of the roadmap will neutralize the impetus for Caribbean citizens to flee, identified as “push and pull” factors. This point is stressed early in the book (Page 13) in the following pronouncements in the Declaration of Interdependence:

xix. Whereas our legacy in recent times is one of societal abandonment, it is imperative that incentives and encouragement be put in place to first dissuade the human flight, and then entice and welcome the return of our Diaspora back to our shores. This repatriation should be effected with the appropriate guards so as not to imperil the lives and securities of the repatriated citizens or the communities they inhabit. The right of repatriation is to be extended to any natural born citizens despite any previous naturalization to foreign sovereignties.

xx. Whereas the results of our decades of migration created a vibrant Diaspora in foreign lands, the Federation must organize interactions with this population into structured markets. Thus allowing foreign consumption of domestic products, services and media, which is a positive trade impact. These economic activities must not be exploited by others’ profiteering but rather harnessed by Federation resources for efficient repatriations.

This foregoing article highlights the new realities ushered into the world as a result of the events of the Year 2008. The Go Lean book focuses heavy on this subject, even identifying this as a motivation in the same Declaration of Interdependence early in the book (Page 13):

xxv. Whereas the legacy of international democracies had been imperiled due to a global financial crisis, the structure of the Federation must allow for financial stability and assurance of the Federation’s institutions. To mandate the economic vibrancy of the region, monetary and fiscal controls and policies must be incorporated as proactive and reactive measures. These measures must address threats against the financial integrity of the Federation and of the member-states.

The Go Lean roadmap proposes a community ethos in which economic principles are recognized as playing a crucial role in the chain-of-events that led to fight-or-flight decisions for Caribbean Diaspora. (These principles were always the reality, just not professionally managed as such). These principles are identified and qualified (Page 21) as follows:

1. People Choose
2. All Choices Involve Costs
3. People Respond to Incentives in Predictable Ways
4. Economic Systems Influence Individual Choices and Incentives
5. Voluntary Trade Creates Wealth
6. The Consequences of Choices Lie in the Future

These principles cannot be glossed over or handled lightly; this is why the Go Lean book contains 370 pages of finite details for managing economic change in the region. In addition to the assessments of the region’s standings, the book contains the following sample of community ethos, strategies, tactics, implementations and advocacies to impact the Caribbean homeland:

Community Ethos – Job Multiplier	Page 22
Community Ethos – Lean Operations	Page 24
Community Ethos – Return on Investments	Page 24
Community Ethos – Ways to Impact the Future	Page 26
Strategy – Competition – Remain Home –vs- Emigrate	Page 49
Strategy – Agents of Change – Aging Diaspora	Page 57
Tactical – Growing the Caribbean Economy to $800 Billion	Page 67
Tactical – Separation of Powers – Versus Member-States Governments	Page 71
Implementation – Year 1 / Assemble Phase	Page 96
Implementation – Ways to Deliver	Page 109
Implementation – Ways to Better Manage Debt	Page 114
Implementation – Trade Mission Objectives	Page 116
Implementation – Reasons to Repatriate	Page 118
Anecdote – Experiences of a Repatriated Resident	Page 126
Planning – 10 Big Ideas for the Caribbean Region	Page 127
Planning – Lessons Learned from 2008	Page 136
Advocacy – Ways to Grow the Economy	Page 151
Advocacy – Ways to Create Jobs	Page 152
Advocacy – Ways to Improve Credit Ratings	Page 155
Advocacy – Ways to Improve Housing	Page 161
Advocacy – Ways to Impact Wall Street	Page 200
Anecdote – Experiences of Diaspora Member Living Abroad	Page 216
Advocacy – Ways to Impact the Diaspora	Page 217
Advocacy – Ways to Help the Middle Class	Page 223
Appendix – Caribbean Emigration Statistics	Page 269
Appendix – Credit Ratings Agencies Role in 2008	Page 276

The Go Lean roadmap has simple motives: fix the problems in the homeland to make the Caribbean a better place to live, work and play. We want to keep Caribbean citizens in the Caribbean. There should be no need to go abroad and try to foster an existence in a foreign land. There is heavy-lifting wherever a person resides. Let’s do the “lifting” here, where at least we are at home and we are treated equitably.

Too many people left, yet have too little to show for it. Now is the time for all of the Diaspora (those in the US, and other countries) to lean-in for the empowerments described in the book Go Lean … Caribbean. We understand your pain, we have been impacted too. (The publishers of the book were entrenched in the Wall Street culture in 2008). This Big Idea now is to use the same energy and innovation to create solutions for Main Street – but not Main Street USA, rather Main Street Caribbean.

This is a dramatic change for the Caribbean, one that is overdue, an invitation to build an elevated society in the Caribbean that many had fled to find elsewhere, yet failed. We can make the Caribbean a better place to live, work and play. We can succeed here.

Download the book Go Lean … Caribbean – now!

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Appendices:

a. Retrieved from https://www.evernote.com/shard/s4/sh/2f378f98-d21b-4f5b-89d4-c3a47419b0ad/479f14e61917697b135246e01d20f85f

b. Retrieved from http://news.rice.edu/2014/07/22/african-american-homeownership-increasingly-less-stable-and-more-risky-2/

c. Retrieved from http://www.epi.org/publication/public-sector-job-losses-unprecedented-drag/

d. Retrieved from http://articles.baltimoresun.com/2012-07-12/news/bs-md-ci-wells-fargo-20120712_1_mike-heid-wells-fargo-home-mortgage-subprime-mortgages

e. Retrieved from http://www.citylab.com/housing/2012/10/did-big-banks-subprime-mortgage-crisis-violate-civil-rights-law/3598/

f. Retrieved from http://online.wsj.com/news/articles/SB111318092881303093

g. Retrieved from http://www.citylab.com/housing/2013/08/blacks-really-were-targeted-bogus-loans-during-housing-boom/6559/

h. Retrieved from http://www.npr.org/blogs/codeswitch/2014/07/21/329864863/the-youth-unemployment-crisis-hits-african-americans-hardest

i. Retrieved from http://www.americanprogress.org/issues/labor/report/2013/04/05/59428/the-high-cost-of-youth-unemployment/

j. Retrieved from http://www.thedailybeast.com/articles/2014/03/13/how-we-built-the-ghettos.html

k. Retrieved from http://grist.org/climate-energy/before-repairing-the-climate-well-have-to-repair-the-impacts-of-racism/

l. Retrieved from http://www.slate.com/articles/news_and_politics/politics/2014/04/desean_jackson_richard_sherman_and_ black_american_economic_mobility_why.html

m. Retrieved from http://www.vox.com/2014/7/21/5918063/elizabeth-warrens-11-commandments-for-progressives-show-democrats

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2008, Banks, Civil Rights, Crony-Capitalism, History, Housing, Power

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Role Model Warren Buffet – An Ode to Omaha

Posted on July 16, 2014 in Ethos, Planning

Go Lean Commentary

This book Go Lean…Caribbean was written in Omaha, Nebraska. The timeframe of being in this Mid-Western American city has now come to an end.

The Great Recession is now over… from the experience of enduring the crisis. It is now only the paperwork that needs to be completed. The paperwork is the Go Lean book: a composition of lessons learned and a roadmap to effectuate change based on the lessons.

What is so special about Omaha?

Well, one thing: The Oracle of Omaha…

… Warren Buffet.

The foregoing article/photo highlights the adoration that the community has for Mr. Buffett.

By: Lance Ulanoff

Title: Nebraska Kid Takes Selfie With Paul McCartney and Warren Buffett

Sixteen-year-old Tom White of Omaha, Nebraska, stumbled upon a scene that could only happen in the movies or a New Yorker cartoon: Paul McCartney and Billionaire Warren Buffett sitting on a bench. He did what comes naturally to his generation: took a selfie.

McCartney, who recently recovered from a hospital stay is back on the road, with a touring stop in Lincoln, Nebraska on July 14. The photo was taken on the evening of July 13.

Buffett lives in Omaha, and the bench break apparently came as part of a lengthy evening of dinner and ice cream, according to Omaha.com. In fact, White’s photo is just one of many captured by Omaha locals as McCartney and Buffett did an eatery crawl through the Dundee section of Omaha.
Mashable.com Social Media Site (Retrieved 07/15/2014) – http://mashable.com/2014/07/14/nebraska-selfie-warren-buffet-paul-mccartney/?utm_cid=mash-prod-email-topstories&utm_emailalert=daily&utm_content=buffer75200&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

Why is Warren Buffett such a great role model for consideration, especially for the Caribbean to emulate?

His entrepreneurship. His commitment to community. His concern for the Greater Good.

Warren Buffet is a good example/sample of someone who prospered where he is planted.

He was born in Omaha, Nebraska (1930), raised and educated there, attending the University of Nebraska. Now as one of the richest men in the world, (# 1 on the Forbes List for 2008 and # 3 since 2011), he has the resources to live anywhere in world. But he chooses to prosper right here in Omaha, where he is planted. Mr. Buffet is widely considered the most successful investor of the 20th century. He is called the “Wizard of Omaha”, “Oracle of Omaha”, or the “Sage of Omaha” and is noted for his adherence to the “value investing”^[a] philosophy and for his personal frugality despite his immense wealth (See photo of his home). Mr. Buffett is also a notable philanthropist, having pledged to give away 99 percent of his fortune to philanthropic causes, primarily via the Gates Foundation.

In 2012, American magazine Time named Mr. Buffett one of the most influential people in the world.

On April 11, 2012, he was diagnosed with prostate cancer, for which he successfully completed treatment in September 2012.

Despite his great wealth, power, and influence, Mr. Buffett is very much human, and humane. His capacity for charity is as compelling as his wealth generating prowess.

Many of the lessons/insights from the role model Warren Buffet and the community of Omaha align with the book Go Lean… Caribbean. The primary focus of this book is the introduction and implementation of the technocratic Caribbean Union Trade Federation (CU). The following 3 prime directives of the CU are explored in full details:

Optimization of the economic engines in order to grow the regional economy to $800 Billion & create 2.2 million new jobs.
Establishment of a security apparatus to protect the resultant economic engines.
Improve Caribbean governance to support these engines.

While the Great Recession may be over in Omaha in specific and the US in general, the effects continue to linger in the Caribbean. The Go Lean book serves as a roadmap for the CU. This commences with the assessment that the Caribbean is still very much in crisis, and that this “crisis would be a terrible thing to waste”. As a planning tool, the book goes on to detail lessons learned from the 2008 Crisis (Page 136) and the City of Omaha (Page 138). This roadmap accepts that the problems of the Caribbean are too big for any one member-state to effect change alone, but rather there should be an interdependent solution. This point is detailed in the Declaration of Interdependence at the outset of the book, pronouncing this need for regional solutions (Page 10):

When, in the course of human events, it becomes necessary for one people to unite with others so as to connect them together to collaborate, confederate and champion the challenges that face them, we the people of Caribbean democracies find it necessary to accede and form a confederated Union, the Caribbean Union Trade Federation, with our geographic neighbors of common interest.

The Go Lean strategy is to confederate all the 30 member-states of the Caribbean (Page 44), despite their language and legacy, into an integrated “single market”. Tactically, this will allow a separation-of-powers (Page 71) between the member-states governments and federal agencies, allowing for efficient economies-of-scale for delivering the benefits of a technocracy to the region.

This is the example of Omaha, personified!

It was practical, providential and inspirational to write this book in this city; see VIDEO here:

The metropolitan area of Omaha had been prominently featured in previous blog considerations:

https://goleancaribbean.com/blog/?p=1341	Blog Number 100: College World Series Time
https://goleancaribbean.com/blog/?p=740	Foreign Mission Offices – Why not … a profit center?
https://goleancaribbean.com/blog/?p=273	10 Things We Want from the US and 10 Things We Don’t Want from the US

Now is the time for all of the Caribbean to lean-in for the empowerments described in the book Go Lean…Caribbean. There are benefits for all to consider in reviewing all aspects of the metropolitan area of Omaha: people, students, patients, governance, institutions and community organizations. These are all a part of the eco-systems of society. So from Omaha’s society, it is time now to apply the benefits in Caribbean society.

The methodology of this assignment was to look, listen, learn, lend-a-hand, and then finally: lead!

The Omaha assignment is now complete! Now the publishers are moving on, back to the Caribbean.

Time to lead!

Download the free e-Book of Go Lean … Caribbean – now!

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Referenced Citation:

a. Value investing is an investment paradigm that derives from the ideas on investment that Ben Graham and David Dodd began teaching at Columbia Business School in 1928 and subsequently developed in their 1934 text Security Analysis. Although value investing has taken many forms since its inception, it generally involves buying securities that appear under-priced by some form of fundamental analysis. As examples, such securities may be stock in public companies that trade at discounts to book value or tangible book value, have high dividend yields, have low price-to-earnings multiples or have low price-to-book ratios.

High-profile proponents of value investing, including Berkshire Hathaway chairman Warren Buffett, have argued that the essence of value investing is buying stocks at less than their intrinsic value. The discount of the market price to the intrinsic value is what Benjamin Graham called the “margin of safety”. The intrinsic value is the discounted value of all future distributions. However, the future distributions and the appropriate discount rate can only be assumptions. (Graham never recommended using future numbers, only past ones). For the last 25 years, Warren Buffett has taken the value investing concept even further with a focus on “finding an outstanding company at a sensible price” rather than generic companies at a bargain price.

Source: Retrieved July 15, 2014 from; http://en.wikipedia.org/wiki/Value_investing

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2008, Banks, Model, Omaha

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5 Steps of a Bubble

Posted on June 13, 2014 in Economics, Planning

Go Lean Commentary

What have we learned?

The Great Recession of 2008 – 2009 has come and gone – though many Caribbean member-states are still reeling from this crisis. The book Go Lean…Caribbean serves as a roadmap for the introduction and implementation of the technocratic Caribbean Union Trade Federation (CU); it declares that a crisis is a terrible thing to waste – quoting famed American Economist Paul Romer.

A popular leadership principle dictates a methodical progression as follows, identified as the 5-L’s:

Look
Listen
Learn
Lend-a-hand
Lead

The CU will assume the leadership role of exploring the opportunities presented as a result of this recent crisis. This leadership starts with the need to study/learn from the 2008 financial crisis, with the goal of minimizing future crisis or at least mitigating their effects. But 2008 is not the only crisis for Caribbean consideration, we also contend with an annual hurricane season. This subject is not an academic pursuit, but rather turn-by-turn directions to elevate Caribbean life and culture. In fact, the following 3 prime directives are explored in the roadmap:

Optimization of the economic engines in order to grow the regional economy to $800 Billion.
Establishment of a security apparatus (including disaster management) to protect the resultant economic engines.
Improve Caribbean governance to support these engines.

All in all, the roadmap commences with the recognition that since 2008 all the Caribbean is in crisis. This acknowledgement is pronounced in the Declaration of Interdependence (Page 13) with these statements:

xxiv. Whereas a free market economy can be induced and spurred for continuous progress, the Federation must install the controls to better manage aspects of the economy: jobs, inflation, savings rate, investments and other economic principles. Thereby attracting direct foreign investment because of the stability and vibrancy of our economy.

xxv. Whereas the legacy of international democracies had been imperiled due to a global financial crisis, the structure of the Federation must allow for financial stability and assurance of the Federation’s institutions. To mandate the economic vibrancy of the region, monetary and fiscal controls and policies must be incorporated as proactive and reactive measures. These measures must address threats against the financial integrity of the Federation and of the member-states.

This issue of learning from the 2008 crisis has been a consistent theme of the Go Lean blogs entries as sampled here:

a. https://goleancaribbean.com/blog/?p=841 – Post 2008: Having Less Babies is Bad for the Economy

b. https://goleancaribbean.com/blog/?p=782 – Open the Time Capsule: The Great Recession of 2008

c. https://goleancaribbean.com/blog/?p=709 – Post 2008 Student Debt Holds Back Many Would-be Home Buyers

d. https://goleancaribbean.com/blog/?p=528 – Facebook plans to provide mobile payment services and remittances

e. https://goleancaribbean.com/blog/?p=378 – US Federal Reserve Releases Transcripts from 2008 Meetings

f. https://goleancaribbean.com/blog/?p=353 – Book Review: ‘Wrong – Nine Economic Policy Disasters and What We Can Learn…’

g. https://goleancaribbean.com/blog/?p=235 – Post 2008 Tourism’s changing profile

The main lesson learned about the cause of the 2008 Great Recession is a poignant one: it spurned from a housing bubble.

Change has come to the Caribbean; the driver of this change is technology, globalization and climate change. From these 3 drivers, bubbles can easily inflate and deflate (burst). The Caribbean region must be astute to recognize the formation of such bubbles. Most importantly, we must apply technocratic skills to mitigate the risk of these bubbles and their eventual deflation.

The term “bubble,” in the financial context, generally refers to a situation in which the price of an asset exceeds its fundamental value by a large margin. During a bubble, prices for a financial asset or asset class are highly inflated, bearing little relation to the intrinsic value of the asset. The terms “asset price bubble,” “financial bubble” or “speculative bubble” are interchangeable, and are often shortened simply to “bubble.”

A basic characteristic of a bubble is the suspension of disbelief by most participants during the “bubble phase.” There is a failure to recognize that regular market participants and other forms of traders are engaged in a speculative exercise that is not supported by previous valuation techniques. Also, bubbles are usually identified only in retrospect, after the bubble has burst. Economist Hyman Minsky identified five stages in a typical credit cycle – displacement, boom, euphoria, profit taking and panic. Although there are various interpretations of the cycle, the general pattern of bubble activity remains fairly consistent.

1.       Displacement
A displacement occurs when investors get enamored by a new paradigm, such as an innovative new technology or interest rates that are historically low. A classic example of displacement is the decline in the federal funds rate from 6.5% in May, 2000, to 1% in June, 2003. Over this three-year period, the interest rate on 30-year fixed-rate mortgages fell by 2.5 percentage points to a historic lows of 5.21%, sowing the seeds for the housing bubble.

2.       Boom
Prices rise slowly at first, following a displacement, but then gain momentum as more and more participants enter the market, setting the stage for the boom phase. During this phase, the asset in question attracts widespread media coverage. Fear of missing out on what could be a once-in-a-lifetime opportunity spurs more speculation, drawing an increasing number of participants into the fold.

3.       Euphoria
During this phase, caution is thrown to the wind, as asset prices skyrocket. The “greater fool” theory plays out everywhere. Valuations reach extreme levels during this phase. For example, at the peak of the Japanese real estate bubble in 1989, land in Tokyo sold for as much as $139,000 per square foot, or more than 350-times the value of Manhattan property. After the bubble burst, real estate lost approximately 80% of its inflated value, while stock prices declined by 70%. Similarly, at the height of the internet bubble in March, 2000, the combined value of all technology stocks on the Nasdaq was higher than the GDP of most nations.

4.       Profit Taking
By this time, the smart money – heeding the warning signs – is generally selling out positions and taking profits. But estimating the exact time when a bubble is due to collapse can be a difficult exercise and extremely hazardous to one’s financial health because, as John Maynard Keynes put it, “the markets can stay irrational longer than you can stay solvent.” Note that it only takes a relatively minor event to prick a bubble, but once it is pricked, the bubble cannot “inflate” again.

5.       Panic
In the panic stage, asset prices reverse course and descend as rapidly as they had ascended. Investors and speculators, faced with margin calls and plunging values of their holdings, now want to liquidate them at any price. As supply overwhelms demand, asset prices slide sharply. One of the most vivid examples of global panic in financial markets occurred in October 2008, weeks after Lehman Brothers declared bankruptcy and Fannie Mae, Freddie Mac and AIG almost collapsed. The S&P 500 plunged almost 17% that month, its ninth-worst monthly performance. In that single month, global equity markets lost a staggering $9.3 trillion of 22% of their combined market capitalization.

Investopedia Online Investing Trade Journal (Retrieved June 12, 2014) http://www.investopedia.com/slide-show/5-steps-of-a-bubble/

The Caribbean region felt the brunt of the Panic of this 2008/2009 crisis. See this news article posted on Jan 18, 2009 in USA Today, describing the full economic devastation with this title: “Caribbean islands slammed with double financial hit” – http://abcnews.go.com/Business/story?id=6677886&page=1&singlePage=true

For the Caribbean, the lessons of the above 5 Steps of a Bubble was not academic, it was real-life, affecting every man, woman and child. But still, bubbles continue to be impactful; in addition to housing market bubbles, the Caribbean must contend with post-hurricane recoveries.

The Go Lean book envisions the CU as a confederation of the 30 member-states of the Caribbean to do the heavy-lifting of empowering and elevating the Caribbean economy by creating a “single market” for the region. Many benefits are due to abound, but there must be caution not to create bubbles.

The book details the community ethos to adopt to monitor, manage and mitigate risks and the emergence of bubbles. The roadmap also details the executions of the following strategies, tactics, implementations and advocacies to guide progress in the region; (a bubble can result in “1 step forward but 2 steps backwards”):

Anecdote – Puerto Rico – The Greece of the Caribbean	Page 18
Community Ethos – Consequences of Choices Lie in the Future	Page 21
Community Ethos – Money Multiplier	Page 22
Community Ethos – Lean Operations	Page 24
Community Ethos – Return on Investments (ROI)	Page 24
Community Ethos – Ways to Impact the Future	Page 26
Community Ethos – Ways to Impact the Greater Good	Page 37
Strategy – Agents of Change – Technology	Page 57
Strategy – Agents of Change – Globalization	Page 57
Strategy – Agents of Change – Climate Change	Page 57
Tactical – Confederating a Non-Sovereign Union	Page 63
Tactical – Fostering a Technocracy	Page 64
Tactical – Growing Economy – Avoid Economic Bubbles	Page 69
Tactical – Growing Economy – Trade and Globalization	Page 70
Tactical – Separation of Powers – Central Bank	Page 73
Tactical – Separation of Powers – Securities Regulatory Agency	Page 74
Tactical – Separation of Powers – Housing and Urban Authority	Page 83
Implementation – Ways to Deliver	Page 109
Implementation – Ways to Better Manage Debt	Page 114
Implementation – Ways to Benefit from Globalization	Page 119
Planning – 10 Big Ideas	Page 127
Advocacy – Ways to Grow the Economy	Page 151
Advocacy – Ways to Control Inflation – Post Natural Disasters	Page 153
Advocacy – Ways to Improve Housing	Page 161
Advocacy – Ways to Improve for Natural Disasters	Page 184
Advocacy – Ways to Foster Technology	Page 197
Advocacy – Reforms for Banking Regulations	Page 199
Advocacy – Ways to Impact Wall Street	Page 200
Advocacy – Ways to Impact Main Street	Page 201
Appendix – Controlling Inflation – Technical Details – Quick Recovery	Page 320

Now is the time for all of the Caribbean, the people and governing institutions, to lean-in for the empowerments described in the book Go Lean … Caribbean. We start by understanding “bubbles”. While the 2008 Great Recession crisis originated as an American bubble, the rest of the world felt its devastating effects. This case-in-point sets the model for the CU to emulate for the Caribbean region; we need a resilient economy that can grow in “ripe” conditions, but avoid any bubble effects. Every year the region is threatened by tropical storms and hurricanes; the spending for recovery, repair and rebuilding can always create a bubble-effect.

This has been the legacy in the past, but now the CU administration is proposed as “new guards” to shepherd the economy to avoid such pitfalls.

The CU/Go Lean roadmap is a complete solution for Caribbean elevation. Despite threats – natural disasters and economic bubbles – the region can be led to a better destination, a better place to live, work and play.

Download the book Go Lean … Caribbean – now!

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Jack M. Mintz: ‘All is not well in the sunny Caribbean’

Posted on May 27, 2014 in Economics, Planning

Go Lean Commentary

“All that glitters is not gold” – Old adage.

This is a similar expression as the title of the below commentary by Canadian Public Policy Professor Dr. Jack Mintz:

“All is not well in the sunny Caribbean”.

The opinions of Canadian stakeholders are and have always been important from a Caribbean perspective. “Look to the Northern Star!” – the book Go Lean…Caribbean relates the hope and refuge that Canada always provided to this region (Page 146).

This book purports that an examination of the history of Canada can be productive for the Caribbean. Despite the different geographic address, Canada has had to contend with a lot of challenges similar to the Caribbean; Canada has succeeded while the Caribbean has failed. Early in the book, the point of lessons from Canada is pronounced in the Declaration of Interdependence (Page 14), with these opening statements:

xxxiii. Whereas lessons can be learned and applied from the study of the recent history of other societies, the Federation must formalize statutes and organizational dimensions … to implement the good examples learned from developments/ communities like … Canada.

Canada recognizes that the Caribbean is in crisis; and despite billions and billions ($$$) in Canadian investments, the region is still in crisis.

Commentary By: Dr. Jack M. Mintz
Economic problems in the Caribbean should be a wake-up call for governments and businesses operating there.

As a middling power, Canada has limited influence in most areas of the world — save for the Caribbean countries. To escape the winter, three million Canadians trek annually to one of the islands to enjoy the sun and relaxation. Roughly 600,000 Caribbean [expatriates] have migrated over the years to Canada, with the largest contingents coming from Jamaica, Guyana, Haiti and Trinidad.

Canada has also invested over $140-billion in capital in the Caribbean islands, especially in Bahamas, Barbados, Bermuda and Cayman Islands. Capital stock held in Barbados alone is over $60-billion, more than any other country except for the United States. The money does not stay there but moves on to other countries so that Canadian multi-national companies can take advantage of the Canada-Barbados tax treaty to achieve lower global effective corporate tax rates through tax-efficient financial structures.

So when Canadian Imperial Bank of Commerce announced a $420-million write-down in goodwill invested in CIBC FirstCaribbean, it should attract attention, given our deep ties to the region. All is not well in the Caribbean region with its bloated, over-indebted governments operating in slow-growth environments. The economic and fiscal problems in the region raise critical economic and security concerns for Canada.

Many Caribbean governments face financial instability. Gross public debt has risen to over 80% of GDP in 2013 for Antigua, Barbados, Grenada, Jamaica, St. Kitts and Nevis, and St. Lucia. Many of these countries are also heavily exposed to global markets with the current account deficit over 20% of GDP in the Caribbean region. Foreign direct investment inflows are more than 8% of GDP for Antigua, Bahamas, Barbados, Grenada, Guyana, St. Kitts and Nevis, St. Lucia and Trinidad-Tobago.

At a flick of the switch, international lenders could turn off the spigots, resulting in a financial crisis and hefty devaluation of currencies. The implications of a severe economic contraction in the region would put the Caribbean countries in limbo and have important consequences to Canada, given our relationships in the region.

The outlook for the Caribbean countries is not exactly cheerful. Overall, economic growth has been poor, about 1.5% for the region, and close to stagnant for Bahamas, Barbados, Grenada and Jamaica. Many of the Caribbean countries face competitiveness problems with some of the highest electricity rates in the world, unionized wage costs and high real interest costs. The business climate is weak with poor regulatory practices, enforcement of contracts and crime.

With the global economic slowdown, tourism has been relatively flat, lagging most regions of the world in 2013. Tourism, after all, is not a necessity and more money is spent on it only when people are better off. The outlook is not looking much better in the near future with little income growth in North America and Europe. Should there ever be reconciliation between the United States and Cuba, U.S. tourism could significantly shift from other islands.

Nor are commodity prices expected to be booming as China and the rest of Asia slow down, with little take up from the rest of the world. Only oil and gas prices seem to be firm, which is good news for Trinidad and Tobago.

With the G20 and OECD countries focused on curbing tax evasion and avoidance, several Caribbean countries – Bermuda, Barbados and Cayman Islands – would be subject to a tightening tax noose. These countries could face a deceleration in economic activity if international tax structures are to be dismantled.

Thus, economic and fiscal problems in the Caribbean should be a wake-up call for governments and businesses operating there. The CIBC write-down is just the tip of the iceberg.

A financial crisis will heavily impact many Canadian businesses that have turned to the Caribbean islands to set up financing and insurance structures. A major economic slowdown in the Caribbean islands would also raise security issues for Canada as crime, including drug trade, could become more problematical to control.

The Canadian government should therefore work with other major countries and international organizations to stabilize Caribbean economies. Attempts to build capacity for good governance in the past years have not been easy but it cannot be abandoned. Some new initiatives should be considered that would help the Caribbean islands improve their fortunes.

Certainly, trying to harmonize policies and merge certain institutions to achieve economies-of-scale across the region would be a useful step. This includes post-secondary education, financial markets and transportation. A shift by Caribbean countries away from oil to natural gas from Trinidad-Tobago and North America would reduce their cost of oil imports.

At the same time, Canada and other Western countries should invest in improving the judiciary and security forces in the [Caribbean] region. The reduction in crime would also benefit our economies by reducing risks faced by tourists and investors. Drug trade with Canada would be curbed.

Debt relief for some of the countries would be appropriate so long as certain commitments are made to reform governance and economic policy. This has been the role of the IMF over the years but Canada should itself pay more attention to the region.

For Canadians looking to bask in the sun and escape harsh winters here, a stronger Caribbean region will be welcome.

Jack M. Mintz is the Palmer Chair, School of Public Policy, University of Calgary. Contact: policy@ucalgary.ca

Source: Financial Post – Canadian Daily; retrieved 05-23-2014 from: http://business.financialpost.com/2014/05/22/jack-m-mintz-all-is-not-well-in-the-sunny-caribbean/

The underlying theme of Jack Mintz commentary is that Caribbean society needs a reboot. The book Go Lean… Caribbean serves as a roadmap for the introduction and implementation of Caribbean Union Trade Federation (CU), a reboot for Caribbean society with these 3 prime directives:

Optimize the economic engines of the Caribbean to grow the economy to $800 Billion and create 2.2 million new jobs.
Establish a security apparatus to protect the resultant economic engines and stakeholders.
Improve Caribbean governance with technocratic excellence.

The foregoing article highlights the mis-management of credit/debt of the governments of the region. The commentary specifically warns:

At a flick of the switch, international lenders could turn off the spigots, resulting in a financial crisis and hefty devaluation of currencies.

Why such poor financial planning? It is obvious that there is a lot of success missing in terms of fiscal expedience. It is not reasonable to expect that current administrations can solve Caribbean fiscal problems with the same tools and techniques of the present. The Go Lean roadmap calls for a different toolbox and different techniques.

If beauty is in the eye of the beholder, then perhaps this commentary is just one person’s assessment of ugly – just a perception. But unfortunately, the facts are the facts. Dr. Mintz relates ugly examples, such as the fact the region has the “highest electricity rates in the world”. There is no denying the “Amount Due” figures on actual electric utility bills.

This is the present, as perceived by Dr. Mintz. Plus, his assessment of the near future is even more “gloom-and-doom”.

True, there is work to be done. But not the job of a Calgary professor, or any other Canadian stakeholder, to do the heavy-lifting. No, this is the job of the Caribbean for the Caribbean. Who is up to the task?

The Caribbean Union Trade Federation hereby “reports for duty” for the job to forge this change.

The Go Lean book details that solutions must come from all aspects of society. There are community values/attitudes that must be in place to ensure that any quest for permanent change would have some measure of success. Those attitudes are referred to as community ethos. There must first be the adoption of many such ethos, followed by the executions of strategies, tactics, implementations and advocacies to impact the region’s prospects, as detailed here:

Community Ethos – Lean Operations	Page 24
Community Ethos – Ways to Impact the Future	Page 26
Community Ethos – Ways to Help Entrepreneurship	Page 28
Anecdote – Entrepreneur’s Best Place To Live? Canada	Page 39
Strategy – Vision – Integrate Region into Single Market	Page 45
Strategy – Agents of Change – Globalization	Page 57
Tactical – Confederating a Permanent Union	Page 63
Tactical – Fostering a Technocracy	Page 64
Separation of Powers – Banking Regulatory Authority	Page 73
Separation of Powers – Justice Institutions	Page 77
Implementation – Foreign Policy Initiatives at Start-up	Page 102
Implementation – Security Initiatives at Start-up	Page 103
Implementation – Ways to Deliver	Page 109
Implementation – Ways to Improve Energy Usage	Page 113
Implementation – Ways to Better Manage Debt	Page 114
Implementation – Ways to Foster International Aid	Page 115
Implementation – Ways to Benefit from Globalization	Page 119
Planning – Lessons from Canada’s History	Page 146
Advocacy – Ways to Grow the Economy	Page 151
Advocacy – Ways to Better Manage ForEx	Page 154
Advocacy – Ways to Improve Governance	Page 168
Advocacy – Ways to Enhance Tourism	Page 190
Advocacy – Reforms for Banking Regulations	Page 199
Advocacy – Ways to Impact the Diaspora	Page 217
Advocacy – Ways to Preserve Caribbean Heritage	Page 218
Appendix – Offshore Tax & Financial Services Industry Developments	Page 321

The Go Lean roadmap calls for a different entrepreneurial approach than some of the tax avoidance industries promoted in the past. These strategies have actually failed. Most offshore financial centers have modernized their lax laws to mitigate terrorism financing, thus lowering their attraction to tax evaders. The hold-outs, (Bermuda, Barbados and the Cayman Islands), are now being forced to cow-tail to the New World Order. The people of the Caribbean deserve better than waiting for “illicit bread to fall from the table” of rich nations (G-20). We have the world’s best address, for goodness sake, people should be beating a path to our doors (like the 3 million Canadians annually), not the 600,000 Caribbean citizens who have beaten down our doors to get out.

Time for change! The Go Lean roadmap is hereby presented.

The region is hereby urged to lean-in to this Go Lean roadmap, to fulfill the vision of making the Caribbean region a better place to live, work and play. 🙂

Download the book Go Lean … Caribbean – now!

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JP Morgan Chase $100 million Detroit investment not just for Press

Posted on May 22, 2014 in Ethos, Planning

Go Lean Commentary

This investment in the turn-around of Detroit is business, not charity. “We could make this our finest moment”.

This was the theme of the Today Show’s Matt Lauer interview with Jaime Dimon, CEO of the US’s largest Bank Holding Company – JP Morgan Chase – that investing in the turn-around and rebirth of distressed cities can be good business. The publisher of the book Go Lean…Caribbean echoes the same sentiments: Ditto!

The same as there is profit involved in destruction and construction, there is profit to be made in community redevelopment, within a city or even for a region. The book posits that combining those two functions (destruction and construction) in an overall effort for rebirth, reboot and turn-around can be truly profitable, and also impact the Greater Good.

This book purports that an examination of the details of Detroit can be productive for the Caribbean; Detroit has a lot of urban blight – see photos here. Early in the book, the point of lessons from Detroit is pronounced in the Declaration of Interdependence (Page 14), with these opening statements:

xxxiii. Whereas lessons can be learned and applied from the study of the recent history of other societies, the Federation must formalize statutes and organizational dimensions to avoid the pitfalls of communities like … Detroit…

The City of Detroit is in crisis. In July 2013, Detroit became the largest U.S. city to seek bankruptcy protection. It is currently $19 billion in debt and has an unemployment rate of about 14% – more than double the national average. This is why the study of Detroit is such an ideal model for the Caribbean. We have many communities within the Caribbean’s 30 member-states with similar unemployment, urban blight, brain drain, and acute hopelessness.

By: David Muller

DETROIT, MI – Last November, the U.S. Department of Justice fined JP Morgan Chase a record $13 billion as part of a settlement over misleading investors over toxic mortgage-backed securities.

In the largest settlement with an American entity in the history of the U.S.A., the Justice Department said that “JPMorgan acknowledged it made serious misrepresentations to the public – including the investing public – about numerous RMBS transactions. The resolution also requires JPMorgan to provide much needed relief to underwater homeowners and potential homebuyers, including those in distressed areas of the country.”

On Wednesday morning, Jamie Dimon, the Chairman and CEO of JP Morgan Chase, was on NBC’s “Today Show” to tout a $100 million investment in the city of Detroit. Later, at noon on Wednesday, he is scheduled to unveil details of the five-year financial infusion in the city over the next five years at Detroit’s Garden Theater with Gov. Rick Snyder and Mayor Mike Duggan.

Dimon told “Today Show” host Matt Lauer that the bank’s investment in Detroit is not a public relations stunt. From the “Today Show”:

“‘The cynic would be wrong,’ Dimon told Lauer when asked if the investment was in response to a $13 billion fine levied against the company in an exclusive interview.

‘We invest and develop communities around the world. And we’ve been doing this since our heritage started 200 years ago,’ said Dimon. ‘So that’s what banks do. They do it commercially. They do community development.'”

According to the Detroit Free Press, the investment by Chase includes $25 million for blight removal and home loans, $12.5 million for job training, $50 million for development projects, $7 million for small business loans and $5.5 million toward the M-1 Rail, the city’s streetcar which is being built on Woodward Avenue.

Detroit’s MLive Media Group (Posted and retrieved 05-21-2014) –http://www.mlive.com/business/detroit/index.ssf/2014/05/jp_morgan_chase_ceo_jamie_dimo.html

Visit NBCNews.com for breaking news, world news, and news about the economy

This book Go Lean… Caribbean, serves as a roadmap for the introduction and implementation of the Caribbean Union Trade Federation (CU). This represents change for the region. The CU/Go Lean roadmap has 3 prime directives:

Optimization of the economic engines in order to grow the regional economy.
Establishment of a security apparatus to protect the resultant economic engines.
Improve Caribbean governance to support these engines.

According to the foregoing article and VIDEO, the rebirth of Detroit will be financed, in part, with $100 million of community investment dollars from JP Morgan Chase. The Go Lean roadmap presents a plan to generate funding to Pay for Change (Page 101). Both the JP Morgan Chase/Detroit plan and the CU/Go Lean plan extend over a 5 year period. The Detroit plan is branded the “Motor City Makeover”; this branding and messaging is important for soliciting support and participation from the community in general. This parallels to the CU/Go Lean effort to foster the attitudes and motivations to forge change from Caribbean stakeholders. This is defined in the book as a community ethos. One such ethos is turn-around: a collective vision, succeeded by appropriate steps and actions, to reject the status quo and demand change.

The book details other ethos to adopt, plus the executions of the following strategies, tactics, implementations and advocacies to impact the rebirths, reboots and turn-arounds of Caribbean communities:

Community Ethos – Deferred Gratification	Page 21
Community Ethos – People Respond to Incentives	Page 21
Community Ethos – Job Multiplier	Page 22
Community Ethos – Light Up the Dark Places	Page 23
Community Ethos – “Crap” Happens	Page 23
Community Ethos – Lean Operations	Page 24
Community Ethos – Return on Investments (ROI)	Page 24
Community Ethos – Ways to Impact the Future	Page 26
Community Ethos – Ways to Help Entrepreneurship	Page 28
Community Ethos – Ways to Impact a Turn-Around	Page 33
Community Ethos – Impact the Greater Good	Page 37
Strategy – Customers – Foreign Direct Investors	Page 48
Tactical – Fostering a Technocracy	Page 64
Tactical – Modeling Post WW II Germany – Marshall Plan	Page 68
Tactical – Modeling Post WW II Japan – with no Marshall Plan	Page 69
Separation of Powers – Public Works & Infrastructure	Page 82
Separation of Powers – Housing and Urban Authority	Page 83
Implementation – Ways to Pay for Change	Page 101
Implementation – Ways to Re-boot Freeport – as a sample city	Page 112
Planning – Ways to Improve Failed-State Indices	Page 132
Planning – Lessons Learned from 2008	Page 136
Planning – Lessons from Detroit	Page 140
Advocacy – Ways to Grow the Economy	Page 151
Advocacy – Ways to Create Jobs	Page 152
Advocacy – Ways to Improve Local Government	Page 169
Advocacy – Ways to Better Manage the Social Contract	Page 170
Advocacy – Ways to Preserve Caribbean Heritage	Page 218
Advocacy – Ways to Promote World-Heritage-Sites	Page 248

The foregoing news article relates that the benefactor, JP Morgan Chase, had been cited and fined ($13 Billion) for inequities associated with the housing bubble and subsequent meltdown. They have a motivation to “curry favor” with the public after their 2008 track record. But they claim that this is not a Public Relations (PR) stunt, and they are willing to put their “money where their mouth is”. There are not a lot of outside benefactors offering to help Detroit, so this city must embrace all the help being offered.

This is another parallel for the CU effort.

There are not a lot of solutions being proffered to the Caribbean region at this time. The Go Lean roadmap is a complete solution for Caribbean elevation. The region is hereby urged to lean-in to this roadmap. This should help the Caribbean to fulfill its vision and get to its desired destination: a better place to live, work and play.

Download the book Go Lean … Caribbean – now!

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Bitcoin needs regulatory framework to change ‘risky’ image

Posted on May 14, 2014 in Economics, Government, Industries, Social

Go Lean Commentary

Electronic Payments / Virtual Money schemes are very important in the strategy for elevating the Caribbean economy.

Bitcoin can be good for the Caribbean, but we need the regulatory framework in place to change any “risky” image of such schemes.

This point is detailed in the book Go Lean…Caribbean, a roadmap for the introduction of the Caribbean Union Trade Federation (CU) and the Caribbean Central Bank (CCB). This Go Lean roadmap has 3 prime directives:

Optimization of the economic engines in order to grow the regional economy to $800 Billion & create 2.2 million new jobs.
Establishment of a security apparatus to protect the resultant economic engines.
Improve Caribbean governance to support these engines.

This Go Lean/CU/CCB roadmap looks to employ electronic payments / virtual money schemes to impact the growth of the regional economy. Similar to Bitcoin, there are two CU schemes that relate to this foregoing news story:

Cruise Passenger Smartcards – The Go Lean roadmap posits that the cruise industry needs the Caribbean more than the Caribbean needs the industry. But the cruise lines have embedded rules/ regulations designed to maximize their revenues at the expense of the port-side establishments. The CU solution is to deploy a scheme for smartcards that function on the ships and at the port cities (Page 193).
e-Commerce Facilitation – The Go Lean roadmap defines that the Caribbean Dollar (C$) will be mostly cashless, an accounting currency. So the Caribbean Central Bank (CCB) will settle all C$ electronic transactions (MasterCard-Visa style or ACH style) and charge interchange/clearance fees (Page 198). This scheme allows for the emergence of full-throttle e-Commerce activities.

These electronic payments provides the impetus for M1, the measurement of currency/money in circulation (M0) plus overnight bank deposits (like demand deposits, travelers’ checks & other checkable deposits). As M1 values increase, there is a dynamic to create money “from thin-air”, called the money multiplier. The more money in the system, the more liquidity for investment and industrial expansion opportunities.

By: Clare Hutchison

LONDON (Reuters) – Regulators should create a framework of rules to help to make virtual currencies such as bitcoin more attractive to ordinary consumers, a lawyer from the Bitcoin Foundation said on Tuesday.

Bitcoin made headlines earlier this year when Tokyo-based bitcoin exchange Mt. Gox filed for bankruptcy after saying it might have lost some 750,000 bitcoins in hacking attack.

Patrick Murck, general counsel at the Bitcoin Foundation, said cooperation was needed between authorities to create rules that would support those using the digital currency responsibly.

“There’s an opportunity to work together to stop people saying it’s scary and risky,” he said. “The challenge is just to get a framework out there that makes sense for people,” said Murck, speaking at an event on the state of digital economy.

Launched in 2009, bitcoin offers a way for people to conduct transactions over the Internet. Supporters say the anonymity that bitcoin offers lowers the risk of fraud, while critics say that same anonymity and lack of central oversight make it easier to commit crimes.

The Bitcoin Foundation aims to standardise the currency, protect it from theft or counterfeiting and provide education.

Some companies involved in bitcoin, including investment firms and those providing services for the currency’s users, have also called for regulation to ensure their customers feel more comfortable about virtual money.

A number of regulators, including the U.S. Securities and Exchange Commission, have warned investors about the risks of scams related to virtual currencies.

Murck said there were a handful of well-funded companies working towards making bitcoin more attractive and safer for ordinary consumers by trying to insure bitcoin holdings and to reduce the currency’s volatility.

Those companies have learned from the collapse of Mt. Gox and have more knowledge about how the industry works that was not available before, he said.

Bitcoin could be ready for the mass market by the end of the year, Murck added. “I feel much more confident today than I did 12 months ago. The wind is definitely blowing at our backs.”

The banking industry also has a role to play in opening the bitcoin market up, Murck said, by providing finance to companies involved in bitcoin or integrating bitcoin services into its own products.

Reuters News Source (Retrieved 05/13/2014) –http://news.yahoo.com/bitcoin-needs-regulatory-framework-change-risky-image-163727371–sector.html

Overall, the Bitcoin concept is in crisis; the dissolution of the Mt. Gox exchange dealt this industry a near-fatal blow. With virtual money, there is no association with hard currency, commodity or chattel goods. It is just the “good faith” and credit of the currency – eWallet – issuer. A bankruptcy filing undermines that “faith”.

The people and institutions of the Caribbean understand this plight all too well. There is little faith in Caribbean monetary institutions either. All interstate trade in the region must take place in US dollars, British pounds or Euros. There is no faith in indigenous Caribbean currencies. The roadmap commences with the statement that the Caribbean also is in crisis, and that this “crisis is a terrible thing to waste”. The region is devastated from external factors: global economic recession, globalization and rapid technology changes. The book then posits that to adapt, there must be a new internal optimization of the region’s strengths. This is defined in Verse XXIV (Page 13) of the Declaration of Interdependence, with these words:

Whereas a free market economy can be induced and spurred for continuous progress, the Federation must install the controls to better manage aspects of the economy: jobs, inflation, savings rate, investments and other economic principles…

Creating the CU/CCB governance is “Step One, Day One” in the Go Lean roadmap. Implementing this, the appropriate regulatory framework, as requested in the foregoing news article, allows rock-solid monetarily integrity for the local financial systems. This would provide the foundation, so that the regional society can be elevated, economically and governmentally.

The Go Lean book details a series of community ethos, strategies, tactics, implementations and advocacies to foster the proper controls for electronic payments/virtual money in the Caribbean region:

Community Ethos – Money Multiplier Principle	Page 22
Community Ethos – “Light Up the Dark Places”	Page 23
Community Ethos – Lean Operations	Page 24
Community Ethos – Cooperatives	Page 25
Community Ethos – Promote Intellectual Property	Page 29
Community Ethos – Ways to Bridge the Digital Divide	Page 31
Tactical – Separation of Powers – Central Banking	Page 73
Implementation – Assemble Central Bank Cooperative	Page 96
Implementation – Ways to Deliver	Page 109
Implementation – Ways to Impact Social Media	Page 111
Planning – Ways to Better Manage Image	Page 129
Anecdote – Caribbean Currencies	Page 149
Advocacy – Ways to Mitigate Black Markets	Page 165
Advocacy – Ways to Foster Cooperatives	Page 176
Advocacy – Ways to Foster Technology	Page 197
Advocacy – Ways to Foster e-Commerce	Page 198
Advocacy – Reforms for Banking Regulations	Page 199
Appendix – Alternative Remittance Modes	Page 270

Now is the time for all of the Caribbean, the people and governing institutions, to lean-in for the changes described in the book Go Lean … Caribbean. The benefits are too alluring, a better place to live, work and play.

Download the free e-book of Go Lean … Caribbean – now!

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One currency, divergent economies

Posted on May 9, 2014 in Economics, Implementation, Planning, Tactical

Go Lean Commentary

The global financial crisis is not over. Some countries, like in Europe, are doing better while some places are not. This quotation from the foregoing article stands out in significance:

Whereas joblessness has fallen in Germany, from 10.1% to 5.1%, it has soared in Spain, from 11.1% to 25.3%.

The experiences have also been similar in the United States. In 2008, California’s unemployment rate exceeded 10%, while Nebraska enjoyed a 4% rate. Why do some member-states dive, some survive and others thrive? This is the scope of the social science of economics. But it is not a perfect science. A joke lampooning the folly of economists states that “an economist is an expert who will know tomorrow why the things he predicted yesterday didn’t happen today”.

By: Staff Reporting.

One thing that the European Central Bank (ECB) does not lack is advice on tackling low inflation. This week the OECD added its voice to that of the IMF in April in urging prompt action, calling for a cut in the bank’s main lending rate, from the already low 0.25% reached in November to zero. The ECB’s governing council, meeting on May 8th (after The Economist had gone to press), was not expected to respond to this plea any more than it did to the IMF’s.

The difficulty facing the 24-strong council is highlighted by the euro zone’s differing labour-market trajectories over the past decade (a period during which it expanded from 12 to 18 countries). Whereas joblessness has fallen in Germany, from 10.1% to 5.1%, it has soared in Spain, from 11.1% to 25.3%.

High unemployment has contributed to the onset of deflation in parts of southern Europe. But even in northern countries inflation is low, and though it has risen in the euro zone as a whole from 0.5% in March to 0.7% in April, that is still a long way off the ECB’s target of close to 2%. The main reasons why the council prefers to wait and see are that the recovery is strengthening and bond investors are falling over themselves to lend to southern Europe, even without any further policy stimulus.

The Economist Magazine – Online Edition – May 10th, 2014 http://www.economist.com/news/finance-and-economics/21601878-one- currency-divergent-economies

Europe’s and the US experience is different than that of the Caribbean. For us, it’s some countries are doing bad, others worse.

The best practice for effective stewards of an economy is the recovery, to bounce back quickly. In the US, the economy lost $11 Trillion in the 2008 Great Recession, but recovered $13.5 Trillion back a few years later, by December 2012 (Page 69).

Europe has the safety net of the economies-of-scale of 508 million people and a GDP of $15 Trillion in 28 member-states in the EU; (the Eurozone subset is 18 states, 333 million people and $13.1 Trillion GDP). The US has 50 states and 320 million people. Shocks and dips can therefore be absorbed and leveraged across the entire region .The EU is still the #1 economy in the world; the US is #2.

The Caribbean has no safety-net, no shock absorption, and no integration. This is the quest of the book Go Lean…Caribbean; it urges the introduction and implementation of the Caribbean Union Trade Federation. The book serves as a roadmap for this goal, with turn-by-turn directions to integrate the 30 member-states of the region and forge an $800 Billion economy.

This is a big idea for the small Caribbean!

At the outset, the roadmap identified an urgent need to contend with, since the Caribbean is still in the throes of the financial crisis (commenced in 2008). This is pronounced in this clause in the opening Declaration of Interdependence (Page 13):

xxv. Whereas the legacy of international democracies had been imperiled due to a global financial crisis, the structure of the Federation must allow for financial stability and assurance of the Federation’s institutions. To mandate the economic vibrancy of the region, monetary and fiscal controls and policies must be incorporated as proactive and reactive measures. These measures must address threats against the financial integrity of the Federation and of the member-states.

The Go Lean roadmap signals change for the region. It introduces new measures, new opportunities and new recoveries. Economies will rise and fall; the recovery is key. Prices will inflate and deflate; as depicted in the foregoing article, there are curative measures to manage these indices. The roadmap calls for the establishment of the allied Caribbean Central Bank (CCB) to manage the monetary affairs of this region. The book describes the breath-and-width of the CCB, modeled in many ways after the ECB.

The foregoing news article is short (3 paragraphs), but like most topics in economics, a quick phrase on the surface connotes a deep field of study underneath. This field of study in this article is inflation and deflation.

In economics, inflation is a sustained increase in the general price level of goods and services in an economy over a period of time. When the general price level rises, each unit of currency buys fewer goods and services. Consequently, inflation reflects a reduction in the purchasing power per unit of money – a loss of real value in the medium of exchange and unit of account within the economy. [a] Deflation is a decrease in the general price level of goods and services. Deflation occurs when the inflation rate falls below 0% (a negative inflation rate). [b]

Stewardship of the economy was envisioned and pronounced in the roadmap’s Declaration of Interdependence (Page 13):

xxiv. Whereas a free market economy can be induced and spurred for continuous progress, the Federation must install the controls to better manage aspects of the economy: jobs, inflation, savings rate, investments and other economic principles. Thereby attracting direct foreign investment because of the stability and vibrancy of our economy.

The role of central banking and commercial banking is pivotal to the CU roadmap. The Caribbean Central Bank will manage the monetary policy and reserves of the Caribbean Dollar single currency – shepherding inflation, deflation and foreign currency matters for the region. On the other hand, commercial banks operate with the simultaneous goal of providing credit/holding deposits for the public and maximizing shareholder value for their investors. A conflict of these two goals can endanger the macro-economy. The CU/CCB structure, a cooperative among existing member-state central banks, constitutes a new administration for the regional economy’s monetary and currency concerns.

If there is the need to spur or suppress inflation/deflation, the CCB will have the required tools. As depicted in the foregoing article, this can affect unemployment and the general performance of local economies.

We therefore need good stewards or shepherds.

The CU roadmap drives change among the economic, security and governing engines. These solutions are as new community ethos, strategies, tactics, implementations and advocacies; as follows:

Community Ethos – Money Multiplier	Page 22
Community Ethos – Job Multiplier	Page 22
Community Ethos – Cooperatives	Page 25
Community Ethos – Impact the Greater Good	Page 37
Strategy – CU Vision and Mission	Page 45
Strategy – Recruiting Foreign Direct Investors	Page 48
Tactical – Fostering a Technocracy	Page 64
Tactical – $800 Billion Economy – How and When	Page 67
Tactical – Recovering from Economic Bubbles	Page 69
Tactical – Separation-of-Powers – Central Bank	Page 73
Implementation – Assemble Caribbean Central Bank	Page 96
Implementation – Ways to Better Manage Debt	Page 114
Planning – Ways to Model the EU	Page 119
Planning – Lessons Learned from 2008	Page 136
Anecdote – Caribbean Currencies	Page 149
Advocacy – Ways to Grow the Economy	Page 151
Advocacy – Ways to Create Jobs	Page 152
Advocacy – Ways to Control Inflation	Page 153
Advocacy – Ways to Better Manage Foreign Exchange	Page 154
Advocacy – Reforms for Banking Regulations	Page 199
Advocacy – Battles in the War on Poverty	Page 222
Advocacy – Ways to Help the Middle Class	Page 223
Appendix – Optimizing Remittances	Page 270

We must protect Caribbean value, monetarily and culturally, from past investments and for future prospects.

Shepherding the economy is no simple task. It requires the best practices of skilled technocrats…and a measure of luck. It’s time to get lucky! The CU roadmap equals preparation. That’s how luck is created, by preparation meeting opportunity.

References:

a. Paul H. Walgenbach, Norman E. Dittrich and Ernest I. Hanson, (1973), Financial Accounting, New York: Harcourt Brace Javonovich, Inc. Page 429.

b. Robert J. Barro and Vittorio Grilli (1994), European Macroeconomics, chap. 8, p. 142. ISBN 0-333-57764-7

Download the Book- Go Lean…Caribbean Now!!!

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Open the Time Capsule: The Great Recession of 2008

Posted on May 5, 2014 in Economics, Planning, Strategy, Tactical

Go Lean Commentary

Picture this: one week after the greatest threats to the global financial system, since the Great Depression. You cut out and store – for safe keeping in a “virtual time capsule”, (see Appendix A) – a newspaper commentary and subsequent review/analysis of that crisis. It’s time now to open that capsule! Why so early? Why only after 6 years? So that this analysis would serve as a course correction. Those placing the time-capsule, hoped for a different result.

This is the scenario depicted in the foregoing news article. It was published on September 23 in 2008; 8 days after Lehman Brothers filed the largest Bankruptcy in world history – signaling the peak of the financial crisis, the precipice of a total system failure. The book Go Lean … Caribbean is based on that premise, declaring that a crisis is a terrible thing to waste”, quoting noted Economist Paul Romer’s assessment that the Great Recession would be a crisis for the modern world. The book posits that the Caribbean, with its parasite economy, is still in that crisis – no noticeable recovery.

A joke lampooning economists declares “that an economist is an expert who will know tomorrow why the things he predicted yesterday didn’t happen today”.

So now, this review/analysis of a 6 year old newspaper editorial from a Guest Columnist, the focus of which was to an audience in the Bahamas; (but this is equally representative of the entire Caribbean):

It is the assessment by the publishers of Go Lean that the foregoing analysis was spot on!

It describes the new normal, a term cementing the truths that the economic realities that suddenly emerged in 2008 would thereafter remain as the norm. This has proven to be the case. The foregoing writer lamented that his government appeared to be using the same set of tools to fix a new vehicle with all different parts, and they pondered why the vehicle would not repair (recover) and get going. The writer concluded that the stewards of the economy needed to prepare a 20 year plan to navigate his country among the new realities facing the world. But he doubted that such a plan would emerge.

By: Craig Butler

I know what you must be thinking. ‘The new normal’, what in heaven’s name is he talking about? Well, the other day I was in Florida listening to talk radio.

There was a director from the International Monetary Fund, an economics professor, and a few others. They were talking about the global economy and what the future holds. The professor was the one who used the ‘new normal’ phrase and he did so in reference to the high prices that we are experiencing worldwide.

He said that, as he did not expect a significant strengthening of the dollar any time soon; coupled with the fact that the price of oil was likely to remain high and the war in Iraq was ongoing, he believed that the current high prices are going to be the norm.

Most of the panelists agreed that some experts have given folks a false sense of security by suggesting that prices will come back down once the price of oil drops. But all on the panel were of the view that the price of oil will never again be under $90 to $100 per barrel.

This was partly based on the weak dollar and partly on our dependency on fossil fuels and the lack of resolve shown by politicians to fully develop alternatives. They also noted that the oil lobby was one of the most powerful in Washington, which was a leading factor in the stalled development of renewable energy.

And the price of breadbasket items and other basics has not been helped by climatic change, which has led to falls in wheat and rice production over the last few years. Add to this the diversion of corn for use as a fuel (ethanol), and we have the new normal.

My views tend to be conservative so my first reaction was that these are some leftwing liberal nuts talking. However, on reflection much of what was said is correct.

Why should we expect to see a reduction in the price of oil? Producers are making so much money it’s not realistic to think they would relinquish that. And the high price affects so many other industries that have had to pass on these increases to the consumer. Just look at the airlines. And all the solutions being put forward to wean us off our dependency on oil will take at least five years to have any kind of impact.

The panel went on to say that there will be a widening of the income gap – something we are already seeing in the Bahamas. Many people who I know in the middle class are struggling so much that they can now be classified as the working poor.

I say that because they are now living from pay cheque to pay cheque. All their savings have been depleted; and things that they once could afford are out of the question now.

Think about it – how many of the people you know around you have their houses in foreclosure; have lost their car to the bank; have had to take their children out of private school; or have been unable to take a vacation this year?

Look in the newspaper this week and I’m sure one of the leading commercial banks will have a double page ad featuring distressed properties. The other week two banks had ads back to back.

I have written before about misguided priorities and how, despite all that is going on, we still prefer the materialistic rather than seek what is important.

I remember from my youth a song by Eddie Minnis called the ‘Finance Man’. I loved that song, and the words to one of the verses bears repeating: ‘See him there he poor as me and you but he driving round in Malibu. His car sleeps in the road at night, Lord you know that just ain’t right, He is living in the hands of the finance man…’

I apologize to brother Eddie if I did the lyrics an injustice. But it demonstrates how we have lived on credit for a long time. We have maintained a lifestyle well beyond our means without a thought as to what might happen in hard times.

As a lawyer I can see first hand what has happened to many in the middle class. You see, it was important for them to have the grand house with the two European cars parked in the garage, kids in the best schools and all the trappings that went along with it. And I will be the first to say that there is nothing wrong with wanting to attain your desires.

However, the bank loans were in many instances predicated on both the husband and wife maintaining $50,000 a year salaries, as well as some creative financing to help the couple get the loan.

Now that many offshore companies have closed or downsized, one of those pay cheques has disappeared and so has the dream, because the severance package is not going to last long and there is a distinct shortage of similar jobs available.

So what we are facing here is now being experienced all over the world. The radio panel noted that there will have to be a reclassification of the status of many people as the poor are going to be poorer, the middle class are going to be the new poor and only the very rich will be able to sustain themselves.

Dark days are ahead, and this means we need our politicians to get their collective heads out of their rear ends and devise a comprehensive plan for the next 25 years that takes all of the current factors into consideration and ensures our viability.

But there I go dreaming again – most of the time they can hardly get out of their own way let alone see past the next general election. So lets wait for the eventual anarchy that is to follow.

*****

Craig Butler studied law at the University of Wolverhampton, England, and at the Norman Manley Law School in Jamaica. He also has a degree in economics from Rollins College in Florida. Mr Butler’s column runs in the Nassau Guardian, the Bahamas, on Mondays and he also hosts a weekly political talk show on Bahamas’ Island FM.

He is the grandson of Sir Milo Butler, the first governor-general of an independent Bahamas. He blogs at Bahamapundit and can be reached at cfmilobutler@hotmail.com.

The New Black Magazine – Online Source – Tuesday, September 23, 2008 –http://www.thenewblackmagazine.com/view.aspx?index=1596

Flash forward 6 years later; lo and behold, the book Go Lean … Caribbean is proffered as that plan, a roadmap to navigate today’s troubling economic waters and offer solutions. The book calls for the introduction and implementation of the Caribbean Union Trade Federation (CU), a super-national administration, for the 30 member-states that constitute the Caribbean region. The book posits that the problems of the Caribbean are too big for any one member-state to tackle alone. That rather, there needs to be a methodical leveraging of the 42 million people that populate these island/coastal states. With such numbers come economies-of-scale, and the benefits of these 3 prime directives:

• Optimization of the economic engines so as to grow the regional economy to $800 Billion and create 2.2 million new jobs.

• Establishment of a security apparatus (with prosecutorial powers for economic crimes) so as to mitigate the eventual emergence of “bad actors”.

• Improve Caribbean governance.

These prime directives recognize that the change the region needs starts first with re-thinking community ethos and economic engines. Early in the book, an economic interdependence is pronounced, (Declaration of Interdependence – Page 13) with these statements:

xxiv. Whereas a free market economy can be induced and spurred for continuous progress, the Federation must install the controls to better manage aspects of the economy: jobs, inflation, savings rate, investments and other economic principles. Thereby attracting direct foreign investment because of the stability and vibrancy of our economy.

xxv. Whereas the legacy of international democracies had been imperiled due to a global financial crisis, the structure of the Federation must allow for financial stability and assurance of the Federation’s institutions. To mandate the economic vibrancy of the region, monetary and fiscal controls and policies must be incorporated as proactive and reactive measures. These measures must address threats against the financial integrity of the Federation and of the member-states.

The book identifies a number of new community ethos to forge change in the region and to harvest the benefits of the new global marketplace. From the ethos, comes the solutions – for example, sharing!

Six years ago, the columnist in the foregoing article could only envision his country, Bahamas, seeking solutions alone. This roadmap, on the other hand, seeks solutions as a confederated region, a group of partners. This will mean speaking with one voice, acting together as the CU; the 30 member-states will have far greater weight and influence than acting individually. Benefits will flow from this economies-of-scale, like a Group Purchasing Organization (GPO) to negotiate value and savings.

The CU roadmap drives change among the economic, security and governing engines. These solutions are as new community ethos, strategies, tactics, implementations and advocates; as follows:

Community Ethos – Lean Operations – GPO’s	Page 24
Community Ethos – Ways to Improve Negotiations	Page 32
Community Ethos – Ways to Impact Turn-arounds	Page 33
Community Ethos – Ways to Improve Sharing	Page 35
Strategy – Agents of Change – Globalization	Page 57
Strategy – Agents of Change – Climate Change	Page 57
Tactical – Confederating a permanent union	Page 63
Implementation – Ways to Pay for Change – GPO’s	Page 101
Implementation – Foreign Policy Start-up Initiatives	Page 102
Implementation – Ways to Improve Energy Usage	Page 113
Implementation – Ways to Better Manage Debt	Page 114
Implementation – Ways to Benefit from Globalization	Page 119
Planning – Ways to Improve Trade – GPO’s	Page 128
Planning – Lessons Learned from 2008	Page 136
Advocacy – Ways to Grow the Economy	Page 151
Advocacy – Ways to Create Jobs	Page 152
Advocacy – Ways to Control Inflation	Page 153
Advocacy – Ways to Better Manage ForEx	Page 154
Advocacy – Reforms for Banking Regulations	Page 199
Advocacy – Battles in the War on Poverty	Page 222
Advocacy – Ways to Help the Middle Class	Page 223

Change has come to the Caribbean; the world is different. It’s not the world before 2008, but rather a new world shaped by 2008. This is illustrated as a moving freight train. It cannot – must not – be stopped. Everyone must get “on board”, or get “run over”.

Appendix A: How to Create a Time Capsule

A time capsule can be as simple as a shoe box full of items reserved (or even forgotten) somewhere. Other time capsules may need to last a very long time, in which case a strong stainless steel container is recommended, with a proper seal. Keep in mind that creating a capsule for unveiling at some future date is really a two sided adventure involving both you and those who will uncover it once again. Make sure that the items you select will add the element of surprise and discovery for those who open this curious treasure chest of history. Learn how to make a time capsule that will be sure to please and surprise whoever opens it. (http://www.wikihow.com/Create-a-Time-Capsule; retrieved May 5, 2014).

Download the book Go Lean … Caribbean – now!!!

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2008, Banks, Crony-Capitalism, Power, Tourism

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