The Pareto Principle

Some of you know it as the 80/20 Rule. The principle states that for many outcomes, roughly 80% of consequences come from roughly 20% of causes. In other words, a minority percentage of causes have a substantial majority effect.

Politicians and their patron saint Niccolò Machiavelli have known this simple crowd control algorithm for centuries. But to be fair to them it’s not just governments and their politicians who live and die by the Pareto Principle. Capitalism thrives on it, artists are tormented by it.

The internet and its virtual communities of social platforms adopted the principle from day one. It was a prime directive practically ripped from Machiavelli’s “The Prince”: capture no more than 20% of traffic, then tell the world that you are the world. How small can you go in the 20% club and still assume the “I’m king of the world!” position? Well, we now know what share of the social media market $44 billion will buy: 9%. As our Titanic hero Elon Musk would say, “let that sink in.” 

Comedian Bill Burr has quipped an interesting number on more than one occasion, when poked about the blowback from audiences over his sarcasm about women. “What, like 20 of them?” he scoffs, mocking the relatively small number of booers or hecklers. But regardless of how he truly feels about women, you may want to pay close attention to his defiance of the Pareto Principle. Some internet neighborhoods have condemned the likes of him and Dave Chappelle as public enemies. Yet reality is the eighty percent undertow behind the shallow shores of the twenty percent. As Chappelle and Burr enter the deep end of accountability, they manage to outsmart the Pareto effect. They are the Schrödinger cats of the comedy circuit.

If comedy’s not your thing, maybe the dark side of the 80/20 ratio will grab your attention.  The two political parties in the US have never enjoyed much more than 20% of actual population support, never mind 51% of voters over the past few decades. And yet, every time a new politician is sworn in they can’t help but parrot the same tired dogma: “The American people have spoken.” They sure have. Somewhere between half and eighty percent either disapprove of you or at best are apathetic. 

When the American Republican Party splintered in recent years from mainstream conservatism to neo-fascist movements, it mastered the Pareto Principle as an alternative fact maker. Ripped from the cover of survival coffee-table books, it convinced itself that when standing up to a bear you should make yourself look bigger. “Never mind those votes, they’re not real anyway. Look over here, deep into my huuuge eyes... then close your little mind and let me take you back, to a magical place from the past that never existed.”

So the next time you cruise the internet’s underworld, watching the rage Geiger counter shoot up by the thousands and the thirst traps by the millions, you may want to remind yourself about the Pareto Principle. Eighty percent of reality is beyond the interest of media and social platforms. They weren’t developed to enlighten you in the first place, their prime directive is to sell. What you’re seeing is blinding you from what you’re not. Which is how selling works. 

One of society’s greatest oxymorons is street wisdom. Survival is powered by instinct, not by wisdom. Street instinct is the king of urban myths, and as such it roars as the ruling monarch of the internet. 

Political Parties And The Death of Nations

Twelve score and five years ago the United States of America declared independence from the oppression of a single, arbitrary monarchy. Imperfect as that declaration was it was a big step in the right direction. More people gained liberty from oppression, though sadly not exactly for all. 

So that challenge from day one, the one on page one of the constitution, was much more of a mission than we've ever bothered to understand: go forth and form a more perfect union. It was the founders way of telling us that they knew they weren’t perfect. Because a threat to liberty anywhere is a threat to justice everywhere. And as God was their witness they knew damn well that they never quite honored that “all men are created equal” bit.

Seven score and nineteen years ago the northern side of an almost one-hundred year old union set out to correct that “liberty and justice for all” brain fart. It was the bloodiest conflict the Union had, and still has ever seen. No foreign enemy has ever incurred more deaths on Americans than Americans themselves. I mean, don’t get me wrong: had Hitler or the Soviet Politburo not been stopped that self-owned wound would have been tragically dwarfed. 

One score ago some cave-dwellers hijacked four commercial aircrafts and weaponized them against our imperfect union. A union they accused of all the evils in the world - as if the evils that they incur on their own people are magically exempt from their messed up sense of cave-justice. 

The US today is not so much at a crossroads as it is at the edge of a cliff. It has managed to successfully fight oppression from monarchy, slave mongers, fascism, and even Stone Age cave dwellers. It’s been at the edge of this cliff before. Cornered here by itself actually - seven score and nineteen years ago. But something ominous has happened: the same two internal forces that drove us to that Civil War cliff never quite went away. Sadly, one of those forces went into “sleeper cell” mode. The kind we often accuse foreign threats of spawning, like the alien mother in hibernation.  

One score ago America’s domestic sleeper cell was awoken, on the day the two towers were fallen. The no-longer-sleeping alien mother took one look at the two ruling parties of America and picked one to assimilate by eating its insides. Temporarily disguised as a legitimate political party it swiftly pushed the US back to the edge of the cliff. 

The enemy within always has and always will be our own worst enemy. We are now way overdue to declare independence from an archaic party system. A party system that has incurred more damage on our own people than monarchy, fascism, communism, and stone-age cave dwellers combined. I’ve crunched the numbers already, like a hundred times since I thought to myself: this can’t be right. I’m not going to rehash those numbers now, please do your own math. But no matter how you shuffle the numbers, these two American parties, whether you think one is benevolent and the other one is an Alien bitch, are not going to walk away from their gravy train. Even if they know it might save our country, they will sooner conduct it off the cliff. 

From Wuhan to New York: The Road To Pandemia

I’ve been bad-mouthing big cities for quite some time now, most of it from a love-hate optic. I was born and grew up in three big cities, though by Manila standards my three country capitals might as well have been adorable little towns. 

I also eventually lived in 10+ million metropolitan sprawls, which is possibly where the dysfunctional relationship began for me. For those familiar with the term “gerrymandering”, the practice was not born merely out of voting suppression tactics. Migration, economics and ethnic control have fueled the driving force behind gerrymandering over the years. 

Google “Chicago population” and it spits back “2.7 million”. Yeah, right. That’s just the number of cars on the Kennedy Expressway at any given hour of the day, give or take an orange barrel. The true MSA (Metropolitan Statistical Area) population of Chicago is closer to 10 million. NYC says it’s 8.3 million peeps. I counted that many alone at the Simon & Garfunkel concert in Central Park. The greater New York MSA is closer to 20 mill.

I believe the Great Pandemic of 2020 will be the last nail in the coffin of the Big City. About time I might add, not a minute too soon. Oh it’s not going to happen overnight. Megacities probably have a few more supernova years left in them. But don’t bet the farm on their comeback. Especially now.

I’m not alone in my prophecy of urban doom of course. We are a visible number of big city skeptics. Some of them are pint-sized fresh new faces like Greta Thunberg. Others are old dogs like David Attenborough. Climate Change drives their skepticism. Mine as well, though with an evolutionary twist.

My love-hate dysfunction with the big apples began while living in the third largest city in the US. A country that happens to host the third largest population in the world (can someone get me a bronze medal, thank you very much). I was in architecture school, with a heavy dose of urban planning and engineering in the curriculum. It was the City and Regional Planning batch of courses (carelessly abbreviated as “CRP”) that first caught my attention. As it turns out, there is an optimal density number for human populations... who knew. Whether you like it or not. Whether you believe in it or not. And whether you believe it to be relevant or not. That number tops out at 100 people per square kilometer. That’s 260 people per square mile. Just over two US acres per person. One-fifth of an hectare per person, or five people per hectare.

For perspective, here’s where some US and world cities fall when compared to the optimum density of 100 people per square kilometer:

Chicago: 4,582 people per square kilometer.

New York City: 10,431 people per square kilometer.

Paris: 20,535 people per square kilometer.

Bnei Brak (Israel): 27,338 people per square kilometer.

Manila: 41,515 people per square kilometer.

In case you’re wondering, Manila is where we cap off as a human race, the highest population density on the planet. No point in casting stones there when New York City, one of the world’s most admired cities, is one thousand times over the limit for a sustainable and healthy population density. Are there gerrymandering factors at play? You betcha. Wuhan China clocks in at a density just over Chicago’s, though given China’s lack of transparency it is anyone’s guess as to where Wuhan’s true density lies. But this being 2020, we actually know one thing: cities like Wuhan are prime incubators of the worst kinds of diseases and pollutants. When it comes to megacities, I think there is nothing to debate anymore: their time has come and gone. They contributed great things, but their wonder years are dangerously close to a zero-sum game. I would hate for that day to come. We weren’t meant to live on top of each other like bats. The skyscraper technology mesmerized us for a century, but it’s time for us to grow up. There is nothing cool about human waste raining down a dense forest of PVC tubes, within just a few square kilometers. 

As for the planet itself: remove water and uninhabitable land and at 7.5 billion we are approximating 300 humans per square kilometer. As a planet, the needle is twitching into the red.

So who are these so-called experts that set the optimal population density bar that low? And why should we believe them? After all, people lead productive and relatively long lives in New York, Paris, and Manila. Well, those experts are highly qualified researchists from leading academic institutions. They are no different than the scientists who have been telling us for decades that we need to mind our levels of DDT and carbon emissions, or our intake of sugar and fat. Yet in spite of their warnings, life goes on. Overblown? Not exactly: false equivalence, pure and simple. My individual survival, or even my thrive, means squat to the gods of evolution. We either thrive as a species or we're useless to the life farmers of the universe.

There are fair warnings, there’s fear mongering, and there’s bias confirmation. Your choice. Mine? For whatever it’s worth, I was born in a city that today is denser than New York City. It’s been a long and winding road for me, through unsustainably-dense cities that I will always love. But not to live in them, ever again. In 2020 I moved to a density of just over 100 people per square kilometer. When I look outside my window I see a wonderful world. One where our neighbors are friendly but we all know how to keep our respectful distance.

It’s The Economy, Einstein

The Economy. The Holy Grail of the college-educated Trump supporters. Also of the non-college educated Trump supporters, though by their own admission they're only repeating what FOX tells them. Unless you have studied economics and worked in a related field for a few years, you are choosing to repeat what someone is telling you out of bias confirmation.

I decided many years ago that I was not going to allow con-men and grifters to sell their batshit crazy in my living room. So I embarked on a top-10 European MBA, plus a few years of working in large scale infrastructure projects. A plethora of statistical analysis and forecasting, to be sure. Looking back it was probably overkill. Like buying an AR-15 when a fly swatter to Mike Pence's head would do. But hey, je ne regrette rien!

I've blogged a few analyses in the past, especially when I hear otherwise smart people talking about things they do not understand. A little tough to bite my tongue when it is coming from the college-educated gang. So I won’t...

"Leading economic indicators" are complex. They track the pulse of capitalism, not the libido of presidents. Presidents' policies impact, but in a free market they are not solely responsible for results. Obama did not “fix” the Great Recession: he impacted its recovery. Trump did not grab the economy by its pussy: he’s been riding it like a pornstar.

Let’s look at MEDIAN HOUSEHOLD INCOME. The Obama administration inherited, and was forced to navigate, the Great Recession of 2008 during their first term. They set their policy with the aim of slamming the breaks on a Median Household Income nose-dive, which had started during the last two years of GW Bush’s administration. By the time Obama’s second term rolled through, the Median Household Income had managed to grow by an impressive 10.5% (between 2013 and 2016).

Enter stage right the Economic Messiah. Earlier this year, as he was kicking off the final year of his first term, Trump took a victory lap around his State of the Union address. He bragged about a record high Median Household Income, one that could be contested depending on how you dissect data from the Federal Reserve and the Census Bureau. But let’s say we decided to give him the benefit of the doubt with that number. Guess what: his first term growth (pre-pandemic) peaked at a rate of 9.2% (between 2017 and 2020). That’s right: with no leading economic indicators in distress when he took office, a fairly robust economy handed over to him from his predecessor, Trump STILL couldn’t beat Obama on rate of growth.

Notice on the chart below how during Obama’s second term, Median Income went up while INFLATION went down. That is a good combo for obvious reasons. Trump’s Median Income growth on the other hand is negatively impacted by inflation - further watering down his braggadocio... 

On the chart below, notice how the income dramatically increases during Trump’s first term for anyone making over $200,000. I make a very good living, but you know what? It’s not about me, is it. It’s about that more perfect union thing:

As for the trifecta of leading economic indicators - GDP, Debt, and Stock Market (S&P 500) - what we have there now is a pile of crap propped up by smoke and mirrors. But let me elaborate:

GDP: As you can see from the chart below, in his first term Trump has not reached Obama’s highs, or even GWB’s for that matter. They both broke 5%, Trump has maxed out at 4%. You wouldn’t know it from listening to “college educated” Trump supporters. But hey, self-owning is the new norm. The reason for our mediocre GDP performance is simple: those socialist Europeans and communist Asians are laughing AT Donald Trump. Not with him.

DEBT: This is where the fat (plus sized?) lady might as well shatter everyone’s eardrums. Not for the faint of heart, no explanation needed for this one. Just note that Trump’s increase intensified Obama’s climb way before the pandemic:

And last but not least, the darling of the Trumpists, S&P performance (Stock Market). Take a close look at the chart below. What do you see? 

Let me unpack it for you in two steps:

1.PRACTICALLY EVERY US PRESIDENT HAS SET AN S&P RECORD FOR THEIR TIME. It’s built in to the nature of the stock market beast. Adulation of Trump as a stock market messiah is embarrassing.

2. If we could brag about anything when it comes to the stock market it would be RATE of growth. How much it grew during the same period of time in each respective administration (as measured by the steepness of the curve). Now take a look at the chart again. What do you see? That’s right, Clinton and Obama impacted a much higher rate of growth.

Listen, I know I got snarky here. I’m tired. We are all tired of the shenanigans on both sides. But college-educated Trumpists, do us all a favor: either get a clue before you talk about “Trump’s Economy” (or the Republicans’ economy for that matter), or for the love of humanity just drop it.

Corporate Finance 101 And The Farce Of Defending Donald Trump’s Finances

ONE. Payroll taxes, exactly as the term implies, are directly attributable to employee pay. I have been both employer and employee. In a perfect world an employee would take 100% of their gross pay and take care of all taxes, healthcare, etc. If you believe that employers are “taking care” of employee taxes above and beyond the employee’s total contribution, then good luck with that bridge you also bought. Same goes for healthcare “benefits”. A business owner is not paying for healthcare or payroll taxes out of his or her own pocket. To state or imply this is either ignorant or manipulative. 

TWO. The vast majority of free enterprise does not operate under the shady practice of serial bankruptcy. About 92% of bankruptcies are a one and done deal. Serial bankruptcy is an obvious pattern of gaming a system. If you don’t like a system then change it. But living under the umbrella of a system, profiting from it, and then vulturing it does not vindicate your contempt for the system: it makes you a con artist and a grifter. 

THREE. Creating jobs as a corporation is only commendable if the jobs are sustainable. Short lived employment caused by a system-gamer is highly destabilizing, wiping out most if not all the short lived value it created. If you add the total amount of contractors stiffed by a system-gamer, including the destabilizing layoffs suffered within each contractor’s organization, plus the direct layoffs within the system-gamer’s organization, you are essentially a net destroyer of value - not a creator of anything. 

FOUR. Siphoning profit first and foremost, knowing that a deal is not sustainable, is admired only by the so-called wolves of Wall Street (an insult to the amazing spirit of wolves). It leaves a wake of destruction behind, perpetually being enabled by a system that hides behind the false flag of “job creation”. These “job creators” regularly hop in bed with politicians, who wave the false flag of job creation for votes, then line their pockets through a wink from their private sector sponsor. 

Very few financial experts, for reasons I cannot quite yet grasp, are working on exposing Donald Trump’s business con game. It’s actually not that difficult. A brain trust from Ivy League academia could easily bring down that house of cards. But just perhaps, Ivy League academia has been in bed one too many times with the big-time grifters. Ivy leaguers already have enough problems with the plethora of buildings and halls named after a gaggle of “robber barons” and “grandpa racists”. This sadly compromises them beyond repair.

The “failing” New York Times is trying, and hopefully they might just succeed. It’s been done before, back when the Washington Post had the good fortune of having Michael Jordan AND Scottie Pippen on their team (Bernstein & Woodward). Notice how relentless DT’s attacks on the NYT are, he knows where his possible downfall would come from. But without the aid of true corporate know-how, the NYT is fighting a battle with one hand tied behind its back. We need a new Deep Throat. A very wealthy Deep Throat...

Here’s where it gets strange: there is a brighter side of the capitalist force, which includes people like Warren Buffett, Bill Gates, Mark Cuban, and quite a few others. You would think that this brain trust could easily join forces with a fourth estate warrior like the NYT and bury the Don in chief once and for all. But unfortunately for the good of the world it’s not that simple. These men are somewhat compromised by a system that rewarded a few bad habits of their own (tax loopholes on steroids), though arguably not at the levels of DJT. Their reluctance is unfortunate and unnecessary. Some questionable maneuvers aside they are net creators of value. As such they should not lurk in the shadows and watch this debacle as if they were powerless. 

Depending on the outcome of the election in four weeks, the fate of our society as we know it may be in the hands of this bright side of the capitalist force. If the voters cannot manage to overturn a deadly error in our democracy, then our captains of industry will have a huge amount of soul-searching to deal with. Turn a blind eye, and they will essentially become grifters themselves by omission. They might as well be the last nail in the coffin of America. 

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The Unnecessary Stupidity of Being A Politician

Our two party system has failed. Think about it: salespeople have found a hack in a system that, as imperfect as it was, started out of a legitimate concern over the tyranny of monarchy. Elections, the darling of democracy, have become a simple game of “low lying fruit” - to borrow a classic sales term. When you know that all you need is 50.1% of an electoral college majority, which is significantly less than the majority of the people, then you have plain and simply figured out how to hack the system. A system, mind you, that was not put in place for “hackers” to create power sharing clubs. It was intended to one day unite all the people. Not that the founders would necessarily agree with the letter of this list, but let’s call it the spirit of it: poor, rich, middle, black, white, female, male, native, immigrant. 

The stupidity comes in the realization that you don’t need to play two people against each other. Or in the case of an entire nation, half the people against each other. When you find the true common denominator in people, powerful agents of change and transformation like love with responsibility, compassion with accountability, and empathy with productivity, you find that you can lead the world beyond the wildest dreams of mediocre Machiavellians. 

Instead, what we have is the oldest Machiavellian play in the book. The Nazis and the Soviets mastered it, like the perfect assassins they became. But like the nazis and the soviets, perfect assassins are soon enough removed from their bully pulpits. They can fool some of the people some of the time, but, to quote GW Bush, “we won’t get fooled again” (with apologies to Pete Townsend and Roger Daltrey on that intellectual property).

The scary part is how fast misinformation turns into disinformation. Which is essentially propaganda. Apparently it rears its ugly head every 50-100 years or so, which is just enough for a generational memory to pass. Makes sense, I suppose, but it doesn’t make evolutionary sense. It is the equivalent of the average addict throughout his or her lifetime falling back on self-destructive behavior. Over. And over. And over. Again. 

When simple minded elites crack the code of “plain speak”, AKA “telling it like it is”, they can do the impossible: they can rally poor and disadvantaged folks to do and believe anything a trust fund benefactor says. They can have them venerate the ground they walk on, just because they spew out the exact same prejudices. I mean, throughout their lives they were marginalized because of those same prejudices, and now the president of the United States is talking like them? Oh man, he is indeed the savior. Get up. Grab your guns, and let that hatred lead you to the promised land. Like it always does. We promised you it would.

Paradigm Lost

In a more perfect union we would be just a few orange tweets shy of bullshit fatigue. An America where the only people tuning in to the shitshow are pundits, trolls, and politicians. Or as I believe Cher put it, gypsies, tramps & thieves. The rest of us, the true majority, would theoretically know better and be united, like it @#$%& says on our name.

But, we don’t live in that “more perfect union”, do we. So off we rush to swallow that bias confirmation painkiller. With our sincere regrets, founding pops, that more perfect thing didn’t quite work out. I mean, don’t get me wrong: a lot has improved since you guys demanded liberty for... um, well, not-exactly-all. 

But maybe that has been the problem all along. You guys didn’t quite believe in your own message yourselves, did you. It was a flawed prime directive from day one. You didn’t like it when a royal family of dicks messed with your freedom, but I cannot tell a lie: pass that Aunt Jemima syrup. Mmmm, hmm.

Now this one’s gonna sting just a little founding pops, but don’t shoot the messenger: Britain abolished slavery thirty years before we did. Yeah, ouch. 

But it’s alright, I still love you. I look to the past for the intention of the lesson, and maybe a paradigm shift or two. Certainly not for greatness, there’s nothing great about ignorance. The only great thing about our past, all of our pasts, lies in the fucking miracle that we didn’t kill everyone. Especially given the sheer amount of ignorance we carry around with us. We didn’t know shit 250 years ago, but we knew enough to walk away from single-family rule. We created a multi-family rule, and it was a step in the right direction. As imperfect as it was, it had elements of greatness in it. Don’t get me wrong, I do admire and respect the paradigm shift. We built a sacred temple of checks and balances, and saw that it was a good thing. 

So here we are, two and a half centuries later. But instead of carving our own greatness all we have done, besides finally abolishing slavery AND apartheid, landing on the moon, and stopping a tyrannical megalomaniac or two, is consolidate that multi-family rule thing. We turned our sacred temple into a country club. A “reality” shitshow. No paradigm shift here to see, more like paradigm shit. Instead of making our own greatness, we got lazy. And fat. And stupid. Must be an empire-ending thing, is it not, Pax Romana...

So maybe that’s where our big misstep lies. Our founders may have set themselves up for partial failure with that half-assed notion of liberty and freedom, but at least they didn’t set out to create another empire. In fact, they shunned the very notion. It was more of a “let our people go” moment, not a “our ruler can fuck the planet up by pressing a button” dystopia. But, that little dictator we all fight inside got the best of us, didn’t it.  

And here we are. Founding pops, meet your offspring, Napoleon and Snowball the pigs. Animals in a barn, one that used to be a temple. I don’t mean to point the finger back at you pops, but maybe if we could finally understand where we went wrong on day one, we just might be able to pick up where you left off. And build a better paradigm, to finally shift the world like you did. This time without a fundamental lie poisoning the well. A well we’ve been drinking from for about one quarter of a millennium.

It is time.

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