Many in the press, especially those in New York and New Jersey, seem to have woken up after Hurricane Sandy and decided that climate change is real and we need to do something about it right away. Climate scientists have been talking about this for more than 30 years. Personally, I’ve looked at the data several times (2001 and 2007). There are multiple different ways you can look at the data. There is ground temperature data, sea temperature data, glacier melt data and tons more. One of the things that makes the climate change data so robust is that scientists are not depending upon one set of data. Instead, they’re looking at multiple different sets of data and they all are basically saying the same thing. Climate change (man’s burning of fossil fuels causing increased carbon emissions which in turn causes changes in the climate) is real. I sit down and talk with Joe Romm from the Climate Progress blog which is associated with the Center for American Progress. Enjoy.
I kind of enjoy the way the Republicans are starting to beat up on each other. Two weeks ago, Newt Gingrich was the recipient of most the beatings. Now, it is Mitt Romney. He is getting hammered (here and here) over his time as chairman at Bain Capital. I suspect that in the coming weeks the American people will have an opportunity to look at venture capitalists up close and personal. Venture capitalists, more than bankers, are the personification of modern day supercapitalism. Bankers have regulations. Venture capitalists are free to do whatever they want to do with their money. Their only goal is to make money for their investors.
Venture capitalists make money in lots of different ways. Traditionally, venture capitalists invested in start-up businesses. They will take a business that is not much more than an idea and turn it into reality. Many businesses will fail. A few will be successful but not make tons of money. Then there are a couple that are hugely successful. They’re the ones that make the venture capitalists truckloads of money.
Another way for them to make their truckloads of money is one that we haven’t talked about much until recently and is less popular with the American people. Venture capitalists can spot a company that is terrifically undervalued. They buy the company, then they carve out what they believe is extremely valuable and cast off the rest of the company. The valuable portion of the company can be bought or sold for profit. This is the ugly side of venture capitalism. The venture capitalists make money, yes, but lots of people lose their jobs because they were working for the “nonprofitable” portions of the company.
Finally, the video (above) points out that Bain Capital took government money in order to make a profit on a couple of deals. This should be no surprise to anyone. The purpose of venture capitalists is to make money any way legally possible, including taking government money.
Americans can take abuse. You can push us around and you can talk badly about us… for a while. Wall Street darling Netflix was raking in money hand over fist. Who would’ve thought that sending DVDs through the mail could be really, really profitable? Well, the guys at Netflix figured this out. They were on Easy Street. They’d figured out a model for delivering movie content to Americans through multiple different ways – DVDs through the mail, direct download to your TV or direct download to your computer. They had an extremely sweet set-up. Then, during the middle of a recession, they decided to raise prices significantly. They forgot their own business model. They forgot that they were delivering movies to Americans cheaply and easily. Without regard to the cheapness, Americans can go and rent a movie at any number of locations or even buy the movie, at a pretty cheap price. Americans were not happy. We spoke loudly and clearly by canceling subscriptions to Netflix – left and right. The reaction was so swift and sudden that we saw something in the United States that we haven’t seen for decades – a CEO actually apologizing to the American people. It may be too little, too late. (I bet you the board will fire him.)