Sunday, August 26, 2012

Get Drunk and Be Somebody

“Here’s to alcohol: the cause of, and solution to, all of life's problems.” – Homer Simpson

Disturbing headline of the week:

College Students Who Binge Drink Say They're Happier.

This was one of several conclusions from a study conducted at Colgate University. The press release goes on to say:

So-called "high-status" and socially powerful college kids are more likely to engage in binge drinking than their less-wealthy, less-connected, lower-status peers, new research reveals. But lower-status students who do binge on alcohol say they are more "socially satisfied" with their college experience than their non-binge-drinking peers.
What this means, say investigators, is that on campuses where binge drinking is a problem, those students who are white, wealthy, straight, male, or fraternity-initiated are much more prone to drink in excess of four to five drinks at a pop than those who are poorer, non-white, female, gay, or unconnected to the frat system.
Higher-status students were also found to be consistently happier with their college social life than lower-status students.
"The study reveals that if you want to understand college binge drinking, you need to understand that college students are reacting to the local campus social situation," said study lead author Carolyn Hsu, an associate professor of sociology and chair in the department of sociology and anthropology at Colgate University in Hamilton, N.Y. "[And] on campuses with a persistently high level of binge drinking, students engage in binge drinking because binge drinking is associated with high status and with social satisfaction."

My take on this is that the more things change, the more they stay the same. Young folks have been getting drunk since the discovery of the fermentation process. Today more women are drinking to excess and overall there does seem to be more open admission of excess drinking. But the social pressure to drink up and have a good time has always been there.

The part of the study that I find interesting is the implication that binge drinking = happiness. First of all, what is binge drinking? In this study binge drinking was defined as:

“Drinking four drinks (for women) or five drinks (for men) during a single session at least once within a two-week period. Sixty-four percent of study participants qualified as binge drinkers.”

I’m not sure what the real definition of binge drinking should be, but this one is questionable. Increase the volume by 50% and make it at least a once a week event and you get to belly up to the bar of true binge drinking. Spend some time there and you will find that happiness begins to fade away very quickly.

As for happiness, if being part of the “right crowd” and having the “right friends” makes one happy, then I would agree that many of those who like to party are happy at this point in their lives. There are probably a lot of other factors involved such as money and good looks. But, any way you slice it, this is happiness at its most shallow and superficial level. And it also fades away very quickly.

The real tragedy of the headline: “College Students Who Binge Drink Say They're Happier” is the message that if you want to be happier, just drink a lot of alcohol. Nothing could be farther from the truth. For the record, I am not a teetotaler by any stretch of the imagination. I enjoy a few beers or a couple of cocktails and indulge accordingly on a regular basis. But, in my younger days, I did my share of binge drinking; major league, all-star binge drinking. And it wasn’t good and it did not make me or anyone around me happy. Physically, mentally, spiritually...too much alcohol is not good for anyone and it’s deadly for some.

Thankfully, I am one of the lucky ones who learned when to say when. I am also one of the lucky ones who never got a DUI or thrown in jail, although I could have been and probably should have been. But I did say and do a lot of things that wrecked more than a few relationships. In the end, nothing good comes from drinking too much. It’s a shame that one of the headlines of the week suggest otherwise.

Friday, August 17, 2012

A Simple Solution

“No question is so difficult to answer as that to which the answer is obvious.” – George Bernard Shaw

In the past I’ve written about our nation’s debt crisis and the inability of our so-called leaders to do anything about it. One side doesn’t want to pay more taxes and the other side doesn’t want to cut spending. Both sides better get ready to be unhappy because we need to do both and we need to do it quickly. Doing something quickly is yet another issue. When the politicians talk about doing something, it’s reforming the tax code or drastically reducing one program, but not another one…gore his ox, not mine. Nothing gets done. Even when they put a gun to their own heads, no one can pull the trigger. (Does anyone really think that $109 billion mandated sequester cuts will happen in January 2013? Or that the Bush tax cuts will not be extended?)

Paul Ryan, the newly announced Republican VP candidate, has published his “Path To Prosperity” budget and it contains some worthwhile proposals. But, it’s overly ambitious and too partisan. Regardless of who gets elected, we’ll be debating someone’s “path” for the next four years. And we’ll just keep on digging the hole as long as the Chinese and others are willing to finance the shovels.

So I say let’s keep it simple and get things moving in the right direction, right now. It doesn’t have to be perfect and it doesn’t have to be the ultimate, end-all program. Here are three of the biggest issues:

1) Our cumulative National Debt is equal to and about to surpass our annual GDP. And most of the growth has occurred over the past 10 years due to increased spending, lower tax rates and a floundering economy. We are at a tipping point and on a trajectory that is unsustainable.
2) Each year we spend more than we take in. In recent years annual tax revenues have been over $1 trillion less than expenditures. But with the soft economy it is very risky to balance the budget immediately. Even if the economy were stronger, extreme increases in taxes or extreme cuts in federal spending would put us at risk of recession.
3) We have a huge unfunded liability associated with Social Security and essentially what amounts to the same thing with Medicare.

I’m not even going to get into the actual numbers…I’ve done that before and it makes my head hurt. I’m just going to layout a basic framework for addressing these problems.

Let’s admit it. We are addicted to over-spending and will need years to wean off of it and get to a balanced budget. Once we get to a balanced budget, we must start chipping away at the national debt. We have to get it down to a more reasonable level, such as no more than 40% of GDP (as a point of reference we’re about $10 Trillion over that today). It may take years to get it done, but getting started now is critical.

We have got a big mountain to climb because once we get the National Debt down to a manageable level we must address funding for Social Security and Medicare. I propose that we take the money we were using to pay down the debt plus some portion of any surplus and begin providing for the unfunded liabilities of Social Security and Medicare. We’re in big trouble on this one and probably too far in the hole to get out of it within the lifetime of anyone born prior to 2000. But we can make a dent in it and hang on until demographics, policy changes and economic growth catch up.

What are the specifics?

1) Immediately impose a debt reduction tax surcharge across the board on all individuals and corporations. Don’t change the tax codes and go through all of that crap. Just whatever your tax burden is, it goes up by X-percent. This addresses the need for more revenue. We can rewrite the tax code later when we have more time and more fiscal breathing room. (I recommend that the X-percent be applied to taxable income and the adjusted total is then taxed accordingly. No one will be happy which tends to make it very fair IMHO).

2) We start cutting federal spending across the board by X-percent. This means that every program and every federal government paycheck takes a haircut (with the exceptions of social security payments, government pension checks, veteran's quote MC Hammer…”can’t touch this”). If a program ends up truly under-funded, we’ll fix it. There is still enough money in this bloated system to cover real needs. But it starts with across the board cuts. And with the increased revenue from the “debt reduction” charge, the cuts required to balance the budget will be very manageable. (Other than the above noted exceptions, everyone and everything takes a hit. And as noted above, I tend to think that makes it all the more fair).

3) Debt reduction becomes part of the budget. So going forward with our new balanced budget, it should include a line item for reducing the national debt (at least $100 billion annually). If we have a surplus in some years, half of that goes toward paying off the debt and the other half to a “rainy day fund”. At some point (which may be 10 or even 15 years from now) we’ll have the debt down to less than 40% of GDP. Then we can start putting the $100 billion along with one half of the surplus toward unfunded liabilities.

4) The law we pass balancing the budget and capping federal debt as a % of GDP should include “kickers” for extreme circumstances, i.e. war or a severe economic depression. These overspend “kickers” must be passed by a 2/3 majority in both the House and Senate. Annual budgets, by law, must be balanced. If during war or a down economic cycle, there is not enough in the “rainy day fund” and we need to overspend; it is treated as borrowed funds and the principle and interest payments go into future budgets. And remember, it must be approved by a 2/3 majority. And it’s only good for one year. Need to do it again next year? Vote on it. No longer do we just casually pass “spending programs” to stimulate the economy or do anything without paying for it today or within a reasonable period of time.

5) Push back the age at which people become eligible for Social Security and Medicare. It has to be done. So just do it. If no one wants to pick the “born after” date that will determine who is impacted, then have a drawing. There is a birth year window of 10 or 15 years that probably makes sense. For example, how about 1965-1975? Let’s say that the luck of the draw turns up so that those born in 1970 or later have to wait 5 years longer to get their benefits. Good for those born in 1969 or earlier, tough luck for everyone else. But we have to take the step.

How much is enough? How much is the X-percent debt reduction charge and how much is the X-percent spending cut? To avoid quibbling about it, I suggest that we get equal amounts from revenue increases and spending decreases. The maximum for both combined is probably around 3% of GDP, or about $500 billion based on our current GDP. But we cannot start out too aggressively. It would take tax increases and spending cuts in the 7-8% range to hit $500 billion. We will have to settle for much less for now. Major tax increases and/or major spending cuts would cripple the economy. Start with baby steps. Increase taxes by 2% and cut spending by 2% in 2013. Then keep ratcheting up the tax increases and spending cuts annually until we get our fiscal house in order.

Establishing a long-term, legislated program to reduce our debt and address the eligibility age for and funding of Social Security and Medicare would actually jump-start our economy. I think it is likely that we could achieve 4-6% annual growth in GDP once we’ve made the commitment to stop digging the fiscal hole. With strong GDP growth we could hit our debt reduction goals even faster, much faster. Growth covers a multitude of problems. Add $10 trillion to our GDP along with a balanced budget and our national debt/unfunded liability burdens become much more manageable.

Washington has become too dysfunctional and our government too large and too complex. Even if members of Congress were willing to work together, I don’t think we have time for them to untangle this mess and try to fix it one program, or one agency, or one department at a time. No question that, at some point, we need to put every program under the microscope. No question that we need to simplify our tax code. But, today our Rome is burning and the fiddle is already in the fire. We need to act now with a relatively simple program that is easily understood and can be quickly implemented. The pain will be shared by all. We need to lose a lot of weight and a strict diet is required, but it can still be a healthy diet. We just need to get started on it sooner rather than later.

Thursday, August 9, 2012

Barney and Me

"The misery of keeping a dog is his dying so soon. But, to be sure, if he lived for fifty years and then died, what would become of me?" – (Sir Walter Scott)

If you haven’t seen the photo of the guy in the water holding his old, arthritic dog; you just weren’t paying attention. And the story that goes with the photo inspires and at the same time breaks your heart.

If you’re a dog person, or just a human being with a heart, you can’t look at that photo and not get a lump in your throat. It really hit me. We have dogs, two very friendly Bichons, Dillon and Boudreaux. They are amusing little guys, low maintenance and great house pets. But once upon a time, we had a real dog. His name was Barney and he was an English Springer Spaniel. The best dog ever. He moved all over the country with us and could handle just about anything or anyone. He was smart, loyal, gentle and absolutely fearless.

Not counting my wife, he was my best friend. But when he died I wasn’t there. Why I wasn’t there is another story and it will be someone else’s to tell someday when I’m not around. But I wasn’t there when he took that long, last ride to the vet. Thankfully my wife was there and to this day she cannot stand to watch the similar scene as it plays out in the movie Marley and Me.

Maybe it was for the best that I wasn’t there. I just don’t know. But I do believe that our dogs will be there for us when we get to heaven. And they will come running to greet us and not only love us, but forgive us for taking so long to get there. (Hell, I can’t even write this post without crying.)

Saturday, August 4, 2012

Thanks For Wasting My Time (Part 4)

Some weeks back I started this series on the most significant “time wasters” we face in the headhunting business:

_The Client does not really know what they want.
_The Client is not willing to pay for what they want.
_The Client has too many people involved in the process.

This week, I’ll wrap things up with a few comments about the “too many people involved” time waster. This has actually become the Number 1 Time Waster because it usually comes into play late in the process. Most of the time we can tell when a client doesn’t know what they want or knows what they want but aren’t willing to pay for it BEFORE we get in too deep. But when it comes to getting “too many people involved” in the interviewing and hiring process; this deal-killing, time-waster usually doesn’t show up until the final interview. If you’ve ever been in sales, you also know this as the “hidden decision maker(s)”.

Anytime we take a search assignment we always ask who will be involved in the interview process and who will make the hiring decision. Most of the time what we are told is not the way things ultimately play out. The reality is that when it comes time for the “final round of interviews”, many organizations grab whoever is available to interview the candidate. So we not only end up with too many people, we often end up with the wrong people. Three things can happen and two of them are bad. The good outcome is that the interviewers all like the candidate and the candidate is still interested in the job after running the interview gauntlet. The two bad outcomes are that one or more of the interviewers doesn’t like the candidate; or that the candidate gets turned off on the opportunity after interviewing with people who weren’t really “invested” in filling the position or may even be downright opposed to seeing the position filled by an “outsider”.

Another factor here is that increasingly we see companies essentially “hire by committee”. I agree that candidates need to be interviewed by multiple people. It’s good for the candidate as well as for the company. But they need to be the “right people” and they need to ask the “right questions”. And when the interviews are completed, all of those involved need to get together at the same time and make their case for or against hiring the candidate. (Some people will disagree with this approach and prefer to have the hiring authority or HR gather the interviewers' feedback one by one. In my opinion, if the interviewers cannot collectively discuss the interview results, then you've got the wrong people involved in the process.) And if the decision is not to hire, the search firm must be told the reasons for that decision. (Of course, whether or not those reasons are shared with the candidate is a matter of judgment and discretion, not to mention legal liability.)

Unfortunately, many companies do not have a good interview process. And it doesn’t improve if you just keep adding more people to the process. It gets progressively worse. As a result, too often the interviewer with the loudest voice (position and/or influence with the willingness to use them) ends up making the decision, not the hiring authority or even the hiring authority and their team. And in the current business environment where people get more blame for doing something that doesn’t work than for doing nothing that doesn’t work, it is much safer to not hire if there is even one dissenting opinion. So the more people involved in the process, the more likely that someone, for whatever reason is likely to say no, or maybe just “yea but”, and kill the deal.

As a headhunter all you can do is ask the questions up front, see what happens and learn from experience. It would be great if all searches were done on a retainer or we simply got paid by the hour. Then the time wasters might be less inclined to waste our time since they would also be wasting their money. But as long as there are enough idiots like me out there who are willing to work on contingency, I am afraid that the time wasters will keep doing business as usual.