I've been confused by the rallying cry of "Freedom!" that we hear at Tea Party events. I wondered: In what way has Obama taken away their freedom? But now I think I get it. I listened to Rand Paul and Pat Toomey when they were taking their victory laps on TV. Freedom, for these cats, means the freedom for business people to exploit natural resources, pollute the environment, endanger the public, and exploit their employees without government interference. They want the crooks on Wall Street to be free to cook up their next big scheme unrestrained by government regulations. And, of course, they don't want to pay taxes that support the departments of education, energy, labor etc.

They're calling for a return to 19th Century capitalism and 19th Century government. They want to erase a century of corporate, social and environmental progress.

This is why Glenn Beck is hung up on the word "progressives." The Progressive Movement emerged in the late 19th and early 20th Centuries in response to the excesses of the Guilded Age--the era of unrestrained, rapacious capitalism. Among the Progressives were Teddy Roosevelt, Henry Ford, and Andrew Carnegie--that bunch of radicals. Beck wants to turn back the clock to the good old days before the Progressives mucked things up with their campaigns to improve public education, protect the markets from manipulation, and restrain the trusts.

Ask me, I don't think endless strip mines and strip malls are what the United States will need to complete globally in the 21st Century. It will need people who are healthy, well-educated, well-treated by their employers, and empowered to invent a new world. Government should play an important role in helping improve the country's ability to compete. But the Tea Partiers don't want a new world. They want the "freedom" that people like them enjoyed in the old one.

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For years, business leaders have complained that the pressure to produce ever-improving results on a quarterly basis inhibits their ability to plan and invest for the long term. Few of them have the guts to do anything about it. If they “miss” their quarter--meaning their profits fall even an iota short of the average earnings forecast by the Wall Street analysts who issue recommendations on their stock--they are punished severely. Their stock price takes a drubbing.

As a result of this situation, companies spend too much time and energy twisting their business into something that meets Wall Streets expectations. That's bad for them, bad for their customers, bad for their employees, and bad for the economy.

Still, badness rules.

I'm sorry to say that I don't have a brilliant and painless solution for this problem. It takes a rare CEO—brave and expert at communicating—to buck the system. And an brave board of directors, as well. Here's an amusing and enlightening little anecdote that shows just how far we have gone in the wrong direction—and suggests a path back to a more rational approach to performance monitoring.

As part of a project I'm working on at IBM, I have been listening to reel-to-reel tapes of a management retreat held by the company in November of 1955 at a resort in Pennsylvania's Pocono Mountains. It was to be the last such meeting for Thomas J. Watson Sr., who had led the company since 1914, and the first one run by his son, Thomas J. Watson Jr. This was a Big Think session for the executives, and, as a stimulus, Watson Jr. had invited Peter Drucker, the father of modern management, to address the group.

At the time, institutional investors were just then emerging as a major factor in the capital markets. While Drucker hailed that development as a boon to corporations, he warned that these investors' need for steady flows of income could become a problem. Because of increasing use of automation, industrial corporations were changing in fundamental ways. Automation reduced their reliance on production workers, who could be hired and fired quickly in response to changing demand, and increased their use of fixed costs—for equipment and for professional and engineering workers whose efforts weren't linked tightly with particular units of production. As a result, he said, companies' profits were beginning to fluctuate more dramatically. And their profit flows were out of sync with the wants of their institutional investors.

His advice: IBM and other companies had to educate institutional investors so they understood the need for long-term planning and investing—and to convince them to live with fluctuating profits. Now here comes the shocker: At the time, companies were measured on their performance on an annual basis, not quarterly. “Don't consider profit an annual event, but look at profitability over a much longer time cycle,” Drucker urged the IBMers. His suggestion: Six to seven years seemed about right. He scoffed at short-sightedness, saying it's what separated non-managers from managers. He asked: “Is there anybody in this room who makes a decision for so short a period as 12 months, ever?'

Now, I'm not suggesting that Wall Street should shift from quarterly to eight-year performance measurement horizons for corporations. But I believe that if the top 15 or 20 corporations spent more effort convincing investors to take a longer view and less effort managing their profits, then investors, workers, consumers, and the global economy would be much better off.

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I've never thought about architecture as much I have since I arrived at IBM. The reason is simple: I never worked in such striking buildings before. I feel like I inhabit works of art.

Starting in the 1950s, longtime CEO Thomas Watson Jr. had the idea that design and architecture were important elements of building a company's brand, so he lined up one famous modernist architect after another to design IBM's buildings. The architects who received commissions since then included Eero Saarinen, who designed the research center in Yorktown Heights, New York, and a factory in Rochester, Minnesota; I.M. Pei, whose firm designed the vast hilltop campus in Somers, New York, and an addition to the former headquarters in Armonk, New York; Edward Larrabee Barnes, who designed the building at 590 Madison Avenue, in Manhattan; and Mies van der Rohe, who designed a skyscraper in downtown Chicago.

The building I spend most of my time in is the headquarters in Armonk, which is a long, horizontal, metal-and-glass clad building that's buried in the woods. It was designed by Kohn Pedersen Fox Associates. The lobby is a huge space that feels lid-less. One end rises up to a point like the prow of a ship. If you sit under the prow and look up through the glass at the treetops and sky, you feel a rush of adrenalin. I'm not exaggerating.

My new interest in architecture took me last weekend to the Saarinen show at the Museum of the City of New York. Saarinen is most famous for designing the Jetsons-like TWA terminal at JFK and the St. Louis Arch. IBM's research center is striking in subtler ways. The main hallway runs along the long curved exterior of the building, so scientists and visitors get fantastic views of a huge lawn and a wooded countryside when they walk to and fro. The extraordinary enlivens the routine.

Saarinen is credited by the museum show's curators with pioneering the concept of the rural corporate campus—part noble's estate and part college campus.

The remoteness of these buildings feels odd now, though. The threats of nuclear Armageddon and urban unrest that propelled corporations out of cities in the 1950s, 1960s, and 1970s are gone. These buildings feel disconnected from society. For me, there's a loneliness, too. After 10 years of working in midtown Manhattan, I miss all the people and buildings crowding in.

Still, in spite of moments of queasiness, my reaction to the change of scenery is overall positive. Like I said at the top, I'm living in art. As far as I'm concerned, that shouldn't be an altogether comfortable experience.

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Now that the world has escaped a total financial meltdown, thanks to Bernanke, Obama, the leaders of China, and a huge dose of luck, it's time to start avoiding the next looming financial disaster: The impact of huge US federal deficits on the world economy and on America's ability to solve problems at home and around the world. Even though the economy is still fragile and the jobs recovery has not begun yet, there's no time to waste.

I was encouraged to hear Senators Kent Conrad and Judd Gregg talk up their proposal for a deficit task force on NPR yesterday (http://tinyurl.com/ylmtd88) they're calling for an 18-member task committee made of up eight Democrats, eight Republicans, and two people from the Obama Administration. The committee would propose ways of lowering the national deficit, which would then go to the House and Senate for a vote.

The thought that the US Congress might get beyond partisanship to take on this huge challenge is the first encouraging sign about the health of our democracy since Obama's election. Even better, they might actually get something done. Reforming Congress itself by getting rid of appropriations bill earmarks would be a good start. But there's plenty of progress to be made in the way the government bureaucracy is organized and operates.

The Obama administration already has some really smart people working on making government more efficient and effective. I met Jeff Zients, the country's chief performance officer, along with CIO Vivek Kundra and CTO Aneesh Chopra, when I wrote a piece about their efforts for BusinessWeek back in November. (http://tinyurl.com/yzunbhu) Jeff told me: “At 30,000 feet, the goal is to make government more effective and efficient by making it faster, smarter, and cheaper.”

Part of the solution is better technology. That's why Kundra and Chopra are working so closely with Zients. And there's a lot more that can be done. I was encouraged this morning to read a speech (http://tinyurl.com/yesnej3)

delivered yesterday by my new boss, IBM's Sam Palmisano, at London's Chatham House. Sam talked about what IBM has learned since it one year ago launched its Smarter Planet strategy for applying technology and thought to make the world work better. One of the takeaways is that governments and companies working together on complex problems can make things function better and more efficiently in fairly short order. One example: in four cities where IBM has helped deploy congestion management systems, traffic volume during peak periods has been reduced by up to 18 percent and CO2 emissions from vehicles were cut by up to 14 percent.

It's abundantly clear that governments need to operate much more efficiently. They're being asked to do more with less. And it's also becoming clear that technology has the potential to play a vital role. In his Chatham House speech, Sam said: “Applying smarter technologies to drive cost out of our legacy systems and institutions—doing more with less—will be critical to our near-term and long-term economic prospects.” The word “critical” is no exaggeration. Hopefully, some cool heads will prevail in the US Congress, and they'll get on with the serious business of solving the nation's looming deficit problems—with technology as an important tool.

One other thought: So much of the attention of the media today is on the latest cell phone or tablet, or the latest consumer social networking Web site. Cool, yes, and these are powerful tools for communications and social change. But the hottest features of the latest gadgets are piffles compared to the uses that technology can be put to to help solve the world's problems. I wish this powerful industry would focus more on that.

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1) After 20 years as a journalist covering the computer industry, with objectivity a core element of my identity, I have now picked sides. It's strange but also empowering. I can get behind something 100%. I have not felt this way since I was on the football team (third-string quarterback) in high school. In this case, my team is 400,000 people strong, as large as Pittsburgh, the city I grew up in. That feels powerful.

2) When they handed out ThinkPads to people in my orientation group, it felt like we were military recruits being issued weapons. Maybe it's the machine itself; ThinkPads are so serious and purposeful in their design. Another factor is the quality of the laptops. At BusinessWeek, we got cheap Dell laptops that often malfunctioned. These ThinkPads are the well-oiled machine of the PC industry.

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Now, along comes an upstart with truly global ambitions. It's XIHA Life. (www.xihalife.com) Launched last year, the site was designed from the ground up by a young Finn living in China, Jani Penttinnen, to be multilingual and to bridge between languages and cultures. Users submit content or chat in their own languages and other people can translate the discrete chunks using Google's translation technology, which is deeply embedded in the site. Today, the site has 600,000 registered users from 208 countries (No country accounts for more than 5% of the total traffic) and about 1 million unique visitors per month. Small, yes, but it's only a year old. Penttinnen, a soft spoken guy with an elfin persona, has ambitious growth targets: 5 million in the next year and 30 million in the next five years.

This site has great potential in its globalocity. But it's not for everyone. It's a magnet for people who see themselves as global citizens or who want to reach across the national chasms. (A group that's about 70% female.) For some, the site offers the possibility of developing online pen pals. For others, it's mostly about reaching out to people in places where they're planning to travel or where they're temporarily working to get the skinny on what they should see and do. A smaller group is hooking up with people willing to help them learn a foreign language. "We try to get and keep the 'right' people--the people who are focused on our themes," says Penttinen. To help steer things in the right direction, he's rounding up a network of expats who will produce high-quality blogs about their experiences--in exchange for small fees. (If you think you have the right stuff, contact Jani@xihalife.com)

Penttinnen, 33, has a personal history befitting his occupation. He came to the US in the early 2000s as a game software programmer when he was hired by EA's Westwood Studios in Las Vegas. After EA closed the studio in 2003, he launched his own tiny mobile gaming company, XIHA Games, with a dab of angel funding. He tried to keep costs ultra-low by outsourcing much of the programming to China, but discovered that remote management of software projects didn't work very well. So he moved to China and managed a small team of programmers. A new problem emerged: To make it in the mobile gaming business, he needed to create versions of his games for each  handset operating system--a huge amount of work that was unattractive to him. Fortunately, he had a hobby that he could turn into a business. Back in 2006, he had launched a crude social networking Web site aimed at an international and multilingual audience. In late 2007, he and his Chinese wife, Wen, moved to Finland and launched an early version of XIHA Life.

This could be one of those really good ideas that never grows up, though. XIHA Life doesn't have much of a business model. Today, Penttinnen, collects affiliate fees for selling mobile games and connecting people with travel sites. That won't support a big operation. Fortunately, he has low costs. The whole thing runs on a single server (Highly optimized software) So it seems likely that XIHA Life will have a chance to succeed. In the meantime, it will be well worth watching to see how a truly global community develops. It could teach valuable lessons even if it doesn't become the next big thing. And, for travel-related businesses, it could turn into a valuable advertising and sales venue.

By the way, xiha means "fun" or "happy" in Mandarin and "Hip-Hop" in Cantonese.

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One of the tough things about being a social entrepreneur, I’m told, is that it’s lonely out there. Unlike regular entrepreneurs who can readily find other people in their geographic proximity and share ideas and experiences with them, social entrepreneurs tend to be widely scattered. They commune via social networks or at infrequent and typically short gatherings of the clan.

A group of four friends in Boulder, Colorado, has come up with an inventive way to address the loneliness of the social entrepreneur. These folks, founders of The Unreasonable Institute, have created a 10-week mini-MBA for promoters of social change. No, check that. The metaphor isn’t quite right. That’s because the 25 or so young entrepreneurs who participate in the program next summer won’t just be learning the skills of social business; they’ll be putting them to work, too. The idea is to come up with ideas, develop them into business plans, vet them, divide up a small pool of venture capital, and connect with a support network—all in the span of an intense 10 weeks. It’s like packaging Silicon Valley in a box. “We want to give young social entrepreneurs the skills, training, and networks to help their ideas grow wings and create a lot of impact,” says Tyler Hartung, the Institute’s community tactician.

The four founders, all University of Colorado at Boulder grads, scan like a mini-United Nations. They refined their ideas for the Institute last summer when they were widely scattered: Teju Ravilochan in Boulder; Vladimir Dubovskiy in India; Daniel Epstein on a bike ride down the West Coast; and Hartung volunteering for a microfinance outfit in Uganda. “It was a most unreasonable time for our founding team,” quips Hartung.
For sure, these guys are having almost too much of a good time, but their idea seems to be both ingenius and practical. All experienced social entrepreneurs themselves, they’ll do a lot of the training in the program, but they’re also planning on bringing in 50 mentors from around the world who are experts in everything from business formation and venture capital to international development and poverty alleviation.

The whole process gets started on Nov. 15, when they begin taking applications from people who want to be Unreasonable Fellows. (www.unreasonableinstitute.org) Applications close on Dec. 15 and a list of finalists will be posted on Dec. 20. Then it’s time for philanthropists and social investors to get into the act. They’ll vote with their dollars for the entrepreneurs who seem to be most promising, and every applicant who raises the $6,500 tuition by Jan. 31 that way will be invited to the summer program. “We want market forces to determine who will come,” explains Hartung.

Now for my part: I’m supposed to help the group round up applicants and funders for the program. So, how about it?

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Ross’s job at State is to figure out how to use the global communications network to address poverty, health pandemics, human rights violations and the like. “With the ubiquity of our global networks, there are opportunities to engage with people that weren’t possible in the past. We’re practicing what I call 21st Century statecraft,” he says. While he’s supposed to use technology to accomplish Clinton’s goals, “In some cases it’s cutting edge. In other cases it’s basic.”

There’s a temptation to fantasize that just because the opposition in Iran used Twitter so successfully during its brief uprising, the latest in social media can be spread around globally like some sort of super digital goo. So it’s good to know that Ross is thinking in a more nuanced way. He gave me a couple of examples of calibrated responses to particular situations.

The low-tech solution: In the eastern Democratic Republic of Congo, where nobody rules and militias run wild, one key issue is figuring out how to get militia members to quit fighting and return to peaceful living. Ross visited with former militia members in demobilization camps and asked them for their advice. What he heard back was that the authorities should use radio to communicate with fighters who are hiding out in the bush, since they all listen to it. The former fighters also suggested that they should be put on air. Fighters would listen to somebody else who had walked in their shoes. So now the State Department is putting together a radio outreach program. “We use 1920s technology if 1920s technology is the right solution,” Ross says.

The high-tech solution: In Mexico, the State Dept. is working with the Mexican government, NGOs, and telecom companies to set up a system for tracking crimes. Right now, a big problem there is that citizens are afraid to report crimes for fear of reprisals—sometimes via police who are working with the thugs. So Ross and his collaborators are working on a cellphone-base tip-off system for the police that will scrub identifying information about the tipsters from the system. They’re also planning on mapping out the activities of common criminals and narco-trafficantes in near real-time on Web sites, so citizens can see where to avoid. “We’re bringing transparency to the activities of the bad guys and empowering citizens,” says Ross.

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The microfranchising outfit that Rosenrot told me about is Village Laundry Services, in Bangalore and Mumbai, India, which helps poor people set up street-side laundry services. VLS has developed an all-in-one laundry kiosk complete with washer, dryer, and ironing set up. The kiosks, with the brand name Chamak, are mounted on rollers so they can be moved around fairly easily. They have self-contained water supplies and plug into the grid via extension cords. Customers who drop their clothes off at the kiosks get them back, folded, within 24 hours. That's a far cry from the normal laundry service in India--where your clothes are washed manually and air dried, and can take days to come back to you. (Too often with missing buttons.)

Rosenrot says VLS has about 15 rigs in service now, hopes to have 110 on the streets by the end of next year and 8500 operating within five years. As of now, VLS owns the rigs, but the plan is to have the entrepreneurs own them--with financing from local microfinance organizations.

In addition to providing ready-made businesses for thousands of poor people, Innosight sees VLS as proving basic business training that will help prepare people to run all sorts of businesses. "We give the local entrepreneurs an opportunity learn from within how a business is run," Rozenrot told me.

It's business ownership on training wheels. This is a new form of capacity building that shows tremendous promise for promoting economic development and self-determination in poor countries.

Not-so-poor countries, too. Rozenrot tells me that Innosight Ventures now has an office in Baltimore as has begun setting up ventures here. "There are some strong parallels between Mumbai and inner-city Baltimore," he says.

Sad, but, I'm sure, true.

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Early in the process of reporting for BusinessWeek's High-Tech Sweatshops story, I spent some time in New Jersey talking to software programmers, outsourcers, and members of the Indian business community. In fact, to get the Indian-American point of view, I attended a meeting of the Asian Indian Chamber of Commerce one afternoon at the invitation of Seema Singh, a lawyer who is the organization's president. The Indian business people I met there are in an uncomfortable spot. Many of them have been living in the United States for years, and many are American citizens. So they want the United States to succeed; they want their children to have abundant job prospects; they want India to succeed, and for Indians to get full access to the benefits of globalization.

The chamber confab was held at Royal Albert's Hotel, a large white stucco building architected to look like a maharaja's palace. It's on the outskirts of Edison, a town in central New Jersey that's the epicenter of Indian culture in the state. Royal Albert's Hotel is set on a bluff overlooking a handful of warehouses. There's a 20-foot-tall status of Indian freedom fighter Sardar Patel out front, and, down in the basement, where the chamber meeting was held, there are elaborately decorated rooms that are typically used for weddings and coming-of-age "thread" ceremonies for Indian and Indian-American boys.
I got a friendly welcome from 30-or-so participants. They were happy to give me their reactions to the controversy over outsourcing and guest worker visas.

Ashok Nagrath, the owner of World Wide Connections Inc., told me that the company had once had 60 employees, but business had dwindled so much that he now that he stopped operating. "There's very little work today, so we're dormant," he said. For him and his company, the Internet changed everything: "It was the death to distance." He doesn't fault India Inc. for the demise of his business, however. And he thinks the US Congress is making a mistake by trying to curtail the offshoring of labor and the use of H-1B visas. "I'm affected by offshoring, but I think it's still the best thing for America," he said. "The US should encourage it, to get the best minds and make them American customers." Concerning guest workers, he said: "They bring in the new thoughts and energy. They pay taxes and contribute to the country."

Kumar Balani, publisher of the magazine Biz India, told me that native Americans should take the holistic view. Products they want to buy can cost less if American companies cut costs and become more competitive by using offshore labor. The challenge for Americans is to acquire more skills and be more creative. "Everybody in the world is under pressure to make themselves more valuable," he said.

Satish Bhalerao, owner of Network Solution, was unapologetic about using guest workers in the US and offshore labor in India. His customers want to reduce costs, and he offers them a lower-cost alternative. He said he pays guest workers in the United States the same as he does native American workers, but he prefers to hire Indians on visas. "They're easily trainable. They're motivated to work hard because they want to live here and to find a way to stay here," he said. But he also worried about America's future. America has already lost so much manufacturing, and now it's losing the lead in science. "Our research is gone. What are we going to offer the world?" he asked.

James Rajiv Bhasin has seen offshoring from both sides. As an employee of Chase in 2003, he lost his job when a lot of the company's work was outsourced to India. Now he's the general manager of business development at Upstream, a subsidiary of Intelenet Global Services, which performs finance and accounting work in India for US clients. "I was shocked when I lost my job at Chase, but I recovered," he said. "I had to reinvent myself. In six years I've done so much more than I ever would have done if I stayed at Chase." Bhasin started his job at Intelenet late last year. He was surprised to realize that it was the company to which he had lost his job six years ago. His new boss is the guy who managed the outsourcing project at Chase. "It amazes me. I've gone full circle," he said.

As I think back on the Indian-Americans I met that night, I can't help but contrast the kinds of things they said--and the unemotional way they said them--to many of the angry and even ugly comments we got on our High-Tech Sweatshops story after it was published online. It was disturbing to see workers from different nationalities verbally tearing at one another. The situation is reminiscent of earlier eras in American history, when employers played immigrants of different ethnicities against each other to defeat labor unions and keep wages low. Like them, today’s guest workers and American programmers are pawns in somebody else’s game.

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One of the organizations that's focused on this opportunity/challenge is the Aspen Network of Development Entrepreneurs. Last Friday, I spoke at a conference ANDE held on Long Island. About a hundred people were there--from dozens of organizations. These outfits have many challenges, and a bunch of them are related to the fact that they're focusing on helping business people rather than poor people. It's much easier to get foundations and individuals to give money to help poor people than it is to get them to help non-poor people--even if the poor benefit in the end. Trickle down economics just doesn't pack the same emotional punch as getting a loan to a poor person who they can buy a cow or a sewing machine.

One of the things this group will have to do is brand the concept of the small business as economic growth engine. Microfinance benefited greatly from having an iconic image at its disposal: A poor woman with her sewing machine. Anybody who saw this image got the concept immediately. Michael Chu, a Harvard Business School professor who was one of the pioneers of microfinance as the one-time CEO of ACCION International, told the ANDE members that he recently visited with one of the business people he made a small loan to many years ago. The guy had a tiny print shop. Now he has a thriving shop buzzing with employees and bristling with shiny new Apple computers.

The promoters of SGBs need to come up with an iconic image that captures that man's story. It will be hard to produce something as simple and easily readable as the lady with her sewing machine, but it's got to be done if the SGB movement is to take wing.

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VillageReach provides the logistics, energy, communications, and transportation infrastructure necessary for public health systems to deliver their services in rough places in Sub-Saharan Africa and India. In 2002 it created a for-profit business, VidaGas, to provide propane to power refrigerators and sterilize medical equipment at remote clinics in Mozambique. There are no commercial propane distributors in the region, so VillageReach had to do something to bridge the gap. Its innovation was creating a for-profit company to deal with the dilemma. "We're one of the few non-profits to develop for-profit businesses to help sustain the impact of our non-profit work," says John Beale, director of strategic development for VillageReach.

In northern Mozambique, as in much of Sub-Saharan Africa, most people and businesses rely on charcoal and wood for basic cooking and lighting. So the folks at VidaGas saw the opportunity to broaden their reach beyond hospitals and clinics. It's now selling to hotels, restaurants, and other small businesses. That move made it possible for the company to become profitable.

Enter Oasis Fund. VidaGas needed capital so it could expand its business more rapidly, so it sought money from unusual sources. Oasis Fund's founder, Jean-Philippe de Schrevel, was a major investor in micro-credit through his BlueOrchard Finance, and his now branching out to invest in other economy-building projects. VidaGas has raised $30 million in two years, mostly from wealthy Europeans, and has invested $1.375 million in VidaGas. "We invest globally in enterprises like VidaGas that have a direct impact on low-income markets," says Keely Stevenson, an investment executive at Bamboo Finance, the advisory firm for Oasis Fund. "We look for exciting social enterprise models that can create great value for their clients, and can also help us grow more philanthropic capital. We're a partner in social innovation."

This is a great win, win, win, win situation. VidaGas helps support VillageReach's work. It improves the public health system. Shifting from burning wood to burning propane is better for the environment. And, if the VidaGas investment pays off for Oasis, it will have more capital to invest in other social ventures.

For VillageReach, this could be the beginning of a major new strategy. It plans on establishing for-profit companies in other counties to fill in gaps in the economic fabric of communities and make real progress possible.

Who knew propane tanks could be so sexy?

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Temperatures are rising and, if they continue to increase as projected, we're looking at rising sea levels that threaten coastal cities and weather changes that threaten agriculture.

At the same time, because of our over-dependency on cars, the average American spends more than a week in traffic per year, which costs the GDP over $200 billion a year and wastes 2.5 billion gallons of fuel. I'm not even counting the waste from those long commutes.

Then there's the dependency on foreign oil suppliers.
It's incredible that in spite of it being abundantly clear a decade ago that this way of living was unsustainable, the US government did nothing to alter the nation's path. Indeed, the credit bubble encouraged people to move ever-further from their workplaces. All of a sudden, Pennsylvania's Pocono Mountains began to be seen as a suburb of New York City, in spite of being 100 miles away!!

Are we nuts?

The answer is inarguably "Yes."

So, now, what do we do about it? There are a lot of things that can be done, and many of them are underway. But the one thing that seems absolutely essential--and could accomplish a lot--isn't even being seriously contemplated. That's raising fuel taxes.
Right now, the average fuel tax for an American driver is about 45 cents per gallon. (That's 18.4 cents federal tax and an average of 27.2 cents for state taxes.) Studies have shown that for each cent per gallon increase in gas and diesel tax reduces consumption by 0.2%. So if you increased fuel taxes by, say $1, perhaps you could reduce consumption by 20%. Also, even with that reduction in consumption, you'd raise up to $125 billion a year in additional tax receipts. This money could be plowed into improving the nation's transportation infrastructure--hopefully, mainly, in alternatives to cars and roads.

Here's another factoid that should give you pause. The United States is spending less than 1 percent of its gross domestic product on our transportation infrastructure, compared to 9% by China and 5% by India. To upgrade the transportation infrastructure to world-class status, we'd have to spend about $200 billion each year for 20 years. That $125 billion a year from increased fuel taxes could help a lot.

Unfortunately, the idea of a fuel tax increase is a non-starter in Washington, D.C. Apparently, Americans have two inalienable rights: The right to carry automatic weapons at anti-Obama rallies and the right to burn up incredible amounts of fuel and create incredible amounts of pollution with impunity.

Are we nuts?

The answer is inarguably "Yes."

What got me thinking about these weighty matters was a "Smarter Cities" conference that IBM put on in NYC last week. I attended a breakout session on transportation, the highlight of which was a presentation by Quentin Kopp, the former chairman of the California High Speed Rail Authority. He was one of the main movers behind a proposal, now partly funded, to build an 800-mile high-speed rail network linking California's major cities. Kopp has been advocating for high-speed rail for more than a decade, and was one of the people who pushed for the extension of the BART line to San Francisco International Airport.

If and when it's completed, the high-speed rail line will make it possible for people to travel from LA to San Francisco in just 2 1/2 hours, and at just 20% of the energy cost of an automobile taking the same trip. "How do you get it done? Necessity," Kopp said.

Kopp had slides mapping out the route and showing artists' renderings of snazzy new transportation hubs linking rail and other modes. Now, that's a Futurama I can get into.

What we need is brave leaders willing to paint a picture of the benefits of a less-car-dependent future that's as compelling as the vision GM and its allies conjured up in 1939 and 1964. If the voters see the necessity, maybe they'll support it.

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Noble Peace Prize winner Muhammad Yunus was his level-headed
provocative self this morning when my colleague, Jay Greene, and I met
him at the Sheraton Hotel around the corner from our office. We asked
him: How can the advocates for the poor capitalize on the downturn? His
answer was that the financial system should be reformed in ways to make
it more inclusive. "If the institutions have failed. let's not go back
to the same thing. Let's fix it. Let's build the bank as an inclusive
institution. Let's extend their services to people who don't have them
now." He says government regulators and policy makers should make some
of their help to banks contingent on their willingness to extend
services to the poor so they don't have to relay on the loan sharks
who operate pay-day loan operations and pawn shops. "The government
should say, 'If you expand we'll help you. If you don't, we won't,'" Yunus says.

Unfortunately, most of the help that the US government is going to
give banks has already been doled out, so the opportunity to do
something constructive may be lost. And, also, unfortunately, banks
making sub-prime loans to people who shouldn't haven gotten them was
one of the things that got us in this big mess. But, still, Yunus is
right that now is the time for the government and the banks to consider
new approaches that would extend banking services to the poor without
causing unmanageable risk to the banking system.

I don't hear anybody else talking about that. It's a shame about wise men.
They're often honored but not heeded.

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Paul Kagame, in many ways, represents the hopes of Africa. He’s a strong but soft-spoken leader who has a radical approach to reconciling the people of his country. He’s willing to take help from richer nations, but insists on independence (“Nobody owns us,” he says) and hopes for a day when Rwanda will no longer be dependent on foreign aid. Hooked to the 15-year anniversary of the Rwandan genocide, Kagame appeared on Fareed Zakaria’s public affairs show on CNN yesterday (http://tinyurl.com/ney6mn).>

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