HBR.com has just put up a post of mine about some new guidelines for “paid content.” The guidelines come from the PR and marketing communications company Edelman, which creates and places paid content for its clients. (Please read the disclosure that takes up all of paragraph 4 of my post. Short version: Edelman paid for a day of consulting on the guidelines. And, no, that didn’t include me agreeing to write about the guidelines)
I just read the current issue of Wired (Aug.) and was hit by a particularly good example. This issue has a two-page spread on pp. 34-35 that features an info graphic that is stylistically indistinguishable from another info graphic on p. 55. The fact that the two pager is paid content is flagged only by a small Shell logo in the upper left and the words “Wired promotion” in gray text half the height of the “article’s” subhead. It’s just not enough.
Worse, once you figure out that it’s an ad, you start to react to legitimate articles with suspicion. Is the article on the very next page (p. 36) titled “Nerf aims for girls but hits boys too” also paid content? How about the interview with the stars of the new comedy “The World’s End”? And then there’s the article on p. 46 that seems to be nothing but a plug for coins from Kitco. The only reason to think it’s not an ad in disguise is that it mentions a second coin company, Metallium. That’s pretty subtle metadata. Even so, it crossed my mind that maybe the two companies pitched in to pay for the article.
That’s exactly the sort of thought a journal doesn’t want crossing its readers’ minds. The failure to plainly distinguish paid content from unpaid content can subvert the reader’s trust. While I understand the perilous straits of many publications, if they’re going to accept paid content (and that seems like a done deal), then this month’s Wired gives a good illustration of why it’s in their own interest to mark their paid content clearly, using a standardized set of terms, just as the Edelman guidelines suggest.
(And, yes, I am aware of the irony – at best – that my taking money from Edelman raises just the sort of trust issues that I’m decrying in poorly-marked paid content.)
Greg Silverman [twitter:concentricabm], the CEO of Concentric, has a good post at CMS Wire about the democratization of market analysis. He makes what seems to me to be a true and important point: market researchers now have the tools to enable them to slice, dice, deconstruct, and otherly-construct data without having to rely upon centralized (and expensive) analytics firms. This, says Greg, changes not only the economics of research, but also the nature of the results:
The marketers’ relationships with their analytics providers are currently strained as a service-based, methodologically undisclosed and one-off delivery of insights. These providers and methods are pitted against a new generation of managers and executives who are “data natives” —professionals who rose to the top by having full control of their answering techniques, who like to be empowered and in charge of their own destinies, and who understand the world as a continuous, adaptive place that may have constantly changing answers. This new generation of leaders likes to identify tradeoffs and understand the “grayness” of insight rather than the clarity being marketed by the service providers.
He goes on to make an important point about the perils of optimization, which is what attracted the attention of Eric Bonabeau [twitter:bonabeau], whose tweet pointed me at the post.
The article’s first point, though, is interesting from the point of view of the networking of knowledge, because it’s not an example of the networking of knowledge. This new generation of market researchers are not relying on experts from the Central Authority, they are not looking for simple answers, and they’re comfortable with ambiguity, all of which are characteristics of networked knowledge. But, at least according to Greg’s post, they are not engaging with one another across company boundaries, sharing data, models, and insights. I’m going to guess that Greg would agree that there’s more of that going on than before. But not enough.
If the competitive interests of businesses are going to keep their researchers from sharing ideas and information in vigorous conversations with their peers and others, then businesses simply won’t be as smart as they could be. Openness optimizes knowledge system-wide, but by definition it doesn’t concentrate knowledge in the hands of a few. And this may form an inherent limit on how smart businesses can become.
CNN.com has posted my op-ed about why where you work is not about the quality of your life so much as about the substance of it.
Judging from some of the reaction, I should emphasize that if the only way to save Yahoo were to require everyone to come to work every day, that would certainly be the right decision. But it seems clear to me that Marissa Mayer was sending a signal with this policy, for surely there are some people who were working productively from home. So, if the new policy is a signal and is not actually required to save Yahoo, then I think she has underestimated how disruptive a signal it is. [To late to stick in a spoiler notice? That was the essence of my op-ed.]
Also, CNN.com has stripped out the links, I’m pretty sure unintentionally. Here they are:
Dylan Tweney notes that Lotus Notes, which invented a bunch of the enterprise collaboration stuff we now take for granted, has become a drag on IBM’s revenues. Dylan writes:
I used it extensively at several companies I worked with. Initially, it was mysterious and powerful. Like most end-users of Lotus Notes, I used it primarily as an email program. It had its quirks, but it worked. But there was another dimension to Notes, a powerful, programmable backend that let you create databases and workspaces for collaborative work, contact management, information sharing, and communication.
Today, we’d call it a collaboration tool or a corporate social-media tool, and it would be web-based and standards-compliant, like Yammer, Jive, and Huddle. In the absence of standards, Notes’ engineers had to invent everything themselves, making it a clever but proprietary solution.
But long before those web-based startups came along, Notes was already losing its cool. The client software became huge and bloated. It was expensive to implement and difficult to customize.
I think I’m legally not supposed to remember that in about 1995, a company I worked for — Open Text — ran a full-page ad in the Wall Street Journal proclaiming “Notes is dead.” ‘Twas the Web that killed it, the ad claimed. I was Marketing VP at Open Text at the time, but the ad was conceived and placed by a different VP. I didn’t hear about it until the morning it appeared; Open Text was that sort of place. And, yes, a lawyer did call us rather promptly.
Anyway, 18 years later, it seems like that bold headline might be coming true.
To be fair, it was true enough at the time. Notes has hung on primarily as an email tool, not living up to its promise as an enterprise collaboration system. And that was indeed because the Web came along with more open solutions that ran in browsers. Eventually. It took a visionary to think that the crappy browsers of that era would someday host fullscale apps — I floated the phrase “client/surfer architecture” but it never took off — but Netscape had such visionaries, and so did Open Text in the form of its CEO, Tom Jenkins.
Lotus Notes was noble software. Brilliant idea. Immensely powerful. But once the Web happened, the jig was up. It took about a decade for enterprises to be willing to trust their mainstream collaborative processes to the Web and its browsers. But eventually Web clients scaled up in power, functionality, and robustness…enabling systems far beyond what the old proprietary backend systems could manage.
Last week I paid a visit to my old PC store, ICG Computers, in Brookline. I hadn’t been there in maybe 5 years because I switched to Macs and thus spend time at the Computer Loft in Brighton. Also, when I was a PC, I was building my own computers out of components, so lots more went wrong (= I did lots more wrong). And, yes, I wish I could compile my own hardware and install the Mac OS on it. (Hackintosh scares me. Someday.) But, my remaining Windows machine crapped out last week, so I carried it to ICG’s small storefront.
Ray greeted me by name. Because no one else was there, we took the opportunity to catch up.
Ray comes from China and runs a quintessential American small business. He’s honest as the day is long, and could teach any bigger company about customer service. But it’s been a lean few years for ICG. Ray says that the recession hurt his primary customer base, small businesses. There haven’t been a lot of new businesses formed, so they’re not coming in to equip their offices. And, of course, the PC business has gotten commoditized. So, ICG relies on repairs and aggressively trying to beat the Internet on prices.
The walls of the store are lined with components. Then there are a few tables of new and used machines. He prices his used machines against eBay, and his new machines against Net low-ballers. As a result, you can get a power-packed laptop for $250 or $300. And you can do so knowing that Ray knows the tech and stands behind what he sells.
ICG is a great place to buy a computer. It’s also a great place to hang out and talk about tech. Ray knows my own level of expertise and talks at that level. No condescension, no salesmanship, no BS. I always learn something talking with Ray. In this case it turns out that my PC needed a new power supply, and the one I’d put in was under-powered. So, yeah, Ray upsold me, but I have complete confidence that he also right-sold me, so to speak.
Bunches of small, locally-owned computer stores have gone out of business here over the past few years. So have most of the larger stores. Remember EggHead? CompUSA? Me neither. And much as I love the Internet, I hate what it’s doing to the Rays of our town, who epitomize the best of small business. ICG is surviving and will continue to serve our community. But I want Ray’s business to do more than that. It seems unfair that honesty, expertise, friendliness, and low, fair prices aren’t enough for a business to go gangbusters.
Mitt Romney is taking some flack for using some notoriously flaky science as his example of good science. But in the same passage he betrays a Big Corporate view of how innovation works that should cost him the support of every entrepeneurial startup in the country.
CARNEY: What role should government have in promoting certain industr
And keep in mind that Romney here is not talking about the auto industry specifically; rather, he is explaining why governments ought not to back entrepreneurial companies. It’s not just that governments are bad at picking winners, it’s that when the winners are startups — even when they’re way out of the prototypical garage — they’re unlikely to get past “delight.” So, wies or economic activities such as homeownership, or manufacturing, renewable energy or fossil fuel energy, eBig Corp xports, or just advanced technology? What sort of subsidies and incentives do you favor? You had some of these in Massachusetts, I know.
ROMNEY: Very limited — my answer Big Corp to your first question. I’m not an advocate of industrial policy being formed by a government. I do believe in the power of free markets, and when the government removes the extraordinary burdens that it puts on markets, why I think markets are more effective at guiding a prosperous economy than is the government.
So for instance, I would not be investing massive dollars in electric car companies in California. I think Tesla and Fisker are delightful-looking ve
And keep in mind that Romney here is nBig Corp ot talking about the auto industry specifically; rather, he is explaining why governments ought not to back entrepreneurial companies. It’s not just that governments are bad at picking winners, it’s that when the winners are startups — even when they’re way out of the prototypical garage — they’re unlikely to get past “delight.” So, whicles, but I somehow imagine that Toyota, Nissan, and even General Motors will produce a more cost-effective electric car than either Tesla or Fisker. I think it is bad policy for us to be investing hundreds of millions of dollars in specific companies and specific technologies, and developing those technologies.
I do believe in basic science. I believe in participating in space. I believe in analysis of new sources of energy. I believe in laboratories, looking at ways to conduct electricity with — with cold fusion, if we can come up with it. It was the University of Utah that solved that. We somehow can’t figure out how to duplicate it.
So, first the problem with his science remark. I understand that he’s boosting Utah. But the 1989 experiment by Stanley Pons and Martin Fleischmann was famous not only because it could not be replicated, but because it was prematurely hyped by Pons and Fleischmann before it had gone through peer review or had been replicated. (As BoingBoing points out, the Wikipedia article is worth reading.) No matter what you think of the experiment, it is a terrible example to use as proof that one appreciates basic science…unless you’re citing the rejection of the Pons-Fleischmann results, which Romney explicitly was not. The issue is not merely that Romney continues to believe in a discredited claim. The real issue is that this suggests that Romney doesn’t understand that science is a methodology, not merely the results of that methodology. That’s scary both for a CEO and for a possible president.
I’m at least as bothered, however, by Romney’s casual dismissal of entrepreneurial startups as a source of innovation: “I think Tesla and Fisker are delightful-looking vehicles, but I somehow imagine that Toyota, Nissan, and even General Motors will produce a more cost-effective electric car than either Tesla or Fisker.” “Delightful” is a dismisive word in this context, as evidenced by the inevitability of the “but” that follows it. Romney, it seems, doesn’t believe that startups can get beyond delight all the way to the manly heavy lifting that makes innovation real. For that you need the established, massive corporations.
Wow. Could there be a more 20th century vision of how a 21st century entrepreneurial economy should work?
I wanted to replace the smashed screen of a white MacBook, and found what seemed like a very good price from Wegener. The new screen arrived very quickly, and was exactly as described. But when I started to strip down the MacBook, I discovered I had ordered the wrong screen. It’s surprisingly easy to do.
So, I sent an email to Wegener and quickly got a reply, followed by a phone call. The support person said they are happy to send me the right screen, for which I have to pay a little more because it’s a more expensive part. They’re sending it even before I return the old one. So far, the experience has been terrific: Quick responses, friendly people, good return policy.
Then they told me that in the carton for the replacement part I’ll find a postage paid mailing label. I reminded them that the problem was entirely my fault, and thus there’s no reason for them to pay for shipping. Yikes, that’s some good customer service! (I went ahead and returned the first screen on my own dime.)
It’s amazing how powerful an experience it is to be treated like a human being by a business.
HumbleBundle is a fantastic way to sell indie games and music. You name your own price, you can divvy it up among the creators and among charities, and today I got a message that they’ve added more songs for free for anyone who purchased the most recent bundle.
Yo, Humbles, I already bought the product. You don’t have to entice me any more. On the other hand: You’ve made me love you even more, and you’ve helped some musicians spread their music just a little wider.
I thought it had been 6 months since my last dental check up. Since I now routinely multiply any past intervals by two, I figured, correctly, that it’s really been a year. Usually, the hygienist has to put on waders and go at me with a pickaxe and a trowel. This was the first time in my life that a dental hygienist has marveled at my teeth. Gums are strong. No tartar, except for a little around a couple of teeth. Some healing of a couple of “pockets.”
There’s been one major variable that I know of: I switched from a Braun electric toothbrush to a Philips SoniCare.Why? Because the Internet told me to. I believe that the correlation is not accidental (see what I did there?), but of course it is just one data point.
He points to a problem in how we’ve thought about design, trained designers, and have practiced design. The great thing about designing simple products is that you can know almost everything about them: who made them, who they’re for, how they were produced, etc. But as products get more complicated, it gets harder even for a team of designers to really understand what’s going on. They get so complicated that there are lots of places design can fail.
When we go out to urban planning , that becomes even more obvious, he says. He shows Union Sq. when it was designed and how wildly NYC has grown around it. Or, at the Courtyard Marriott chain, every element of the user’s experience has been thought through. He shows a script that specifies every interaction. But you can’t anticipate everything. E.g., JetBlue is one of the best designed customer experiences and even they got it wrong a couple of winters ago.
What’s going on? It’s all about complexity. Henri Poincaré in the 19th century tried to solve the three body problem that had been set by the French govt as an open source competition. HP couldn’t solve it. It sounds like a simple problem, but it’s very hard. [BTW, there’s a fascinating history of three French aristocrats hand-computing the movement of Halley’s Comet, which depended on calculating the gravitational influences of multiple bodies. Can’t find the ref at the moment]
Our basic ideas about design have been based on Newton, says Tim. Design assumes the ability to predict the future based on the present. We need to think more like Darwin: design as an evolutionary process. Design is more about emergence, never finished.
He presents a few principles of Darwinian design that he’s been exploring.
1. Design behaviors, not objects — the behaviors that come from our interactions with objects. If you’ve traveled on the high speed trains in Europe, there are signs urging men to be more accurate when peeing. But at Schiphol Airport, they print a fly at the right spot in the urinal; men became 80% more accurate. That’s designing behavior; the actual object doesn’t matter.
2. Design for information flow. Nicholas Christakis has looked at how networks affect behavior. Tesco uses its loyalty card — which cost them 20% of their margins — to increase sales.
3. Faster iteration = faster evolution. Viruses evolve faster than we do because they iterate faster than we do. E.g., State Farm tried out a new idea how to build relationships with the new generation. They built one storefront for this, and learned from it. “Launch to learn.”
4. Use selective emergence. This intrigues him, alathough he doesn’t know how useful it will be in design. Rather than random mutations, you choose what might be interesting and design things that get us there through many iterations. I.e., genetic algorithms. E.g., the Strandbeest walks along beaches with a hip joint unlike any in nature because the artist used genetic algorithms.
5. Take an experimental approach. I.e., testing hypotheses. Cf. Eric Ries, the Lean Startup (build, measure, learn). E.g., Ideo.org has been working on sanitation in Ghana. Where you can’t dig septic pits, Ideo has been experimenting with low cost receptacle toilets (with bio-digesters). But people didn’t want to pay for the service. So, they gave some to families and went away for three days. All the families changed their minds and said they are willing to pay for the service (which is provided by a local franchise).
6. Focus on simple rules. This comes from emergence theory. E.g., complex bird flocking patterns are based on simple rules. [Canonical example: Termite mounds.] E.g., Bi-Rite stores in SF uses simple rules: If an employee is within 10′ of a customer, you look the customer in the eye. If within 4′, you talk with them. This creates a wonderful service experience.
7. Design is never done. E.g., World of Warcraft is constantly being designed by its players.
8. The power of purpose. This creates the self-governance these complex environments succeed. Arab Spring and Occupy Wall Street are examples. Companies are experimenting with new ways of thinking about their business and products. E.g., Patagonia tells you not to buy its products because it also wants to preserve the environment.
The prototypical design artefact is a blue print. Once you created the blue print, the design was done. It was the instruction set for someone to make it. That’s how we think about design: finish and done. What replaces it: Code. It might be DNA (and Tim has people researching this), but more often it’s programming code. It’s an instruction set that can continue to evolve.
JF: You embody your principles. The rules are differen from a prior version. [ACK! Crash. Missed about 2 minutes]
TB: We’ve just finished designing the prototype experience for the new health care exchanges. It will affect how people choose which health care insurance to choose. Today it’s done with paper. Under the new health care laws, lots of people will get to make these choices. We worked with the CA Healthcare Foundation to prototype the user experience. What are the key pieces are parts? How can we keep the choices reasonably simple? Then each state will use this a platform to develop their own.
JF: And the govt had the wit to come to you to do this?
TB: The CA Health Care Foundation…
JF: What are the barriers? Does it cost more to do it your way?
TB: It’s often less costly. Most often they don’t have a good understanding of what their customers go through. When a health care org comes to us, relatively frequently we find out that a senior exec had to go through the health care experience. It’s true of all organizations. We don’t ask the right questions. The urgency to change is not there, and the resistance to change is always huge.
JF: Has the TSA come to you?
TB: Yes, but … well, we learned a lot. In the previous admin, we worked with them to find areas of change. Although going through the scanners has to improve, a lot of it has to do with the behavior of the people. They looked at a training program that was intended to take away some of the rule-based system they used. The more rules you apply, the less sensitive the system is. You need to give the people in that system much more independence to make judgments.
JF: Who do you hire?
TB: We look for a wide range of people. Many disciplines. We look for deep skills, and for empathy. It’s hard to solve problems for others without that. Also, most of what we do is too complex for individuals, so we work in teams, and thus people need an enthusiasm for empathy.
JF: Any unusual interview techniques?
TB: We put people into a situation in which they’re practicing design. E.g., intern program. Also, competitions. And we use Open Ideo as a way of seeing how people work.
JF: Beyond the toilet, what else are you doing for “design for poverty.”
TB: I got excited when I saw the opportunities for design in some social design work. At Open Ideo we’re working on clean water, early ed programs, etc. Ideo.org is a non-profit org. We want it to be sustainable and scalable so we look for external funding for it.
JF: How do you approach environmental sustainability?
TB: We try to build that into every project. Every project affects the environment. We try to bring sustainable thinking around systems, materials, energy flows, etc.
JF: What projects are you proudest of?
TB: The work we do in health care, including with Kaiser Permanente. Also, consumer-facing, post-crash financial services. PNC digital wallet. “Keep the change.” Etc. This is not an area where design has had much to do.
TB: For physical objects, it peaked maybe 20-30 years ago (with Apple as an exception). But we’re in ascendance for behavior-based designed. We get 25,000 apps a year for 100 openings. We’re a 600-person company. Etsy, Kickstarter, sw designed better than ever before…great things are happening. Soon if not already the number of digital designers will be greater than all other designers combined.
Q & A
Q: Your principles are so close to Buckminister Fuller’s [says the guy from the Fuller institute]. But the boundary between social and evolutionary systems is illusory.
TB: Yes, Fuller figured this out a long time ago. We’re perhaps resurrecting ideas, as every generation does. Design has operated as a priesthood for too long. When I started, I was only interested in how beautiful something is. That’s so much simpler. Opening design up to many more will convince us all that we’re all part of this big design ecosystem and have a responsibility to be thoughtful about the contributions we’re making to the world around us. I hope professional designers learn to enable that, more than controlling it. The B School at Stanford is introducing non-designers to design, which is great.
Q: What can we do to simplify the rules?
TB: The unstated bit of my thesis is that you still have to stop and design something. We develop an idea, perhaps more through iteration. That process doesn’t change. For rebuilding a complex system, maybe big data will help us to see patterns that allow us to understand what we’re designing’s complex effects…but I don’t think we’re there yet. We should be thinking about the hooks we’re building in. I’m big into APIs that allow other people to build with what you’ve built.
Q: Is it training or DNA that determines a good employee for you?
TB: Both. We hire people straight out of grad school because they’re moldable. We hire older people, but it’s harder for them to adapt. I don’t have much control as CEO. The future of all businesses is to have cultures that are a s self-governing as possible. That’s much more resilient and agile than cultures built on inflexible rule sets.
Q: I chair a land conservancy. We create parks in urban areas. Does Ideo have much experience in designing to create behaviors that will get people to use parks? What’s your view of the state of park design?
TB: We don’t have a lot of expertise in designing anything because we like designing everything. The High Line and the West Side park in NYC are remarkable examples. Projects like that show that parks can be remarkable assets to the city. We’re working with High Line on the third phase of that project. NYC’s life expectancy has gone up 3 yrs. Two explanations: People are closer to health facilities, and people walk more.
Q: What are the logistics of running a decentralized org? Mentoring? Sharing a vision?
TB: Purpose creates a sense of direction, so we talk about why the heck we’re doing what we’re doing. We think we should measure everything we do based on the impact it has on the word. We’ve done an occasionally decent job of mentoring; that can be a problem with a decentralized org. It’s a tension. Most of our employees probably want more mentoring, but we also want autonomy. We are not big believers in warehousing knowledge. Designers hate reusing other people’s ideas. It’s much better to have knowledge systems that inspire people to think in new ways. So we’re a storytelling culture. It’s a bit of an obsession of ours. If you do a piece of work, your job is to have some stories to tell about it. That’s more effective than big reports that live in a database somewhere.
(JF calls for all remaining questions)
Q: My group works with at-risk youth. Education is increasingly standards based, but your work is collaborative.
Q: How do you look at chaos? People in open markets are open and affectionate. In corporate controlled spaces, people shut down.
Q: Does form drive function or vice versa?
Q: Apple is a closed system. Google wants more control. Open vs. controlled systems?
TB: 1. University ed is not always the best way to teach entrepreneurship. Apprenticeships are interesting. 2. Great markets are vibrant, but not chaotic. I take clients to the Ferry building to point out all the interrelated pieces that make that such a great experience. It’s not top down, but you can see the patterns and use them as inspiration. 3. Form follow function? Hard to kick that notion because I believe in beautiful engineering, but most things we’re designing today have hundreds of functions, so you can’t get a single form for it. 4. I love closed systems but I think they’re inevitably part of an open system. IOS is part of an open system of everything else that I do with it. We need both. [At last! Something I disagree with! Sort of! :)]
[Fantastic. I’ve been a huge fan of Ideo’s work, and Ideo’s organizational ethos, and Tim Brown, for a long time. So I felt particularly narcissistic as I heard this talk through Cluetrain and Too Big to Know lenses. Substitute “knowledge” for “design” and you get a lot of the ideas in 2b2k. To hear them coming from Tim Brown, who is a personal idol of mine, was a self-centered thrill.]
Walter Isaacson is interviewing Ricardo Salinas (Mexicon media billionaire) and Richard Haass (president of the Council on Foreign Relations) about our relationship with Mexico.
NOTE: Live-blogging. Getting things wrong. Missing points. Omitting key information. Introducing artificial choppiness. Over-emphasizing small matters. Paraphrasing badly. Not running a spellpchecker. Mangling other people’s ideas and words. You are warned, people.
Richard H. says that the media only covers drugs and guns when it comes to Mexico, but that’s a very small part of the problem. In fact, Mexico is a major economic success story. Indeed, he says, the Americas are an amazing success story: growing economies, democratic, at peace, overall. Ricardo says that his Mexican company employs 75,000, but they have 15,000 unfilled positions; Americans may emigrate to Mexico to get jobs.
Ricardo says that demand is driving the Mexican drug trade. It has become violent in Mexico, he says, because the president has said, as a policy, “Get them all.” The victims are cartel members — over 50,000 dead. Richard H. says the drug trade is more peaceful in the US because the police aren’t as corrupt. Ricardo says Mexico should adopt the US policy: raise the professionalism of the police, and focus on the violence; let the rest slip for now.
Richard H. asks if MExico will open itself up to foreign oil investors, because Mexico is an under-producer. Ricardo says the national govt gets about 30% of its revenues from oil. There will be foreign investment in extracting the oil, he says, but not in the oil territories themselves. There’s also solar, wind, and geothermal energy in Mexico.
The student movement, inspired by left wing leaders, says the media are closed to them, but that’s untrue, says Ricardo (media mogul). The media are balanced. Calderon’s electoral reform of 2007 gave political parties 3 mins of air time every hour of radio and TV for free. That’s “theft,” Ricardo says.
After the upcoming election, it’s 5 months of waiting. Also, presidents are limited to one 6-year term. Might either of these change? Ricardo says that the five month waiting period should be changed. But there’s no political possibility of changing the one-term rule.
Nicholas Burns: Presidents Bush and Obama have put a lot of their eggs into Brazil as the primary political partner in the Americas. Does that underestimate Mexico? Mexico is a regional power.
Ricardo: Mexico is such a friend that they don’t even take us into consideration. The relationship with Mexico is really good. Huge amounts of investment. The traffic in goods and services is huge. Everything is working fine. Richard H. says US-Mexican trade is 5x US-Brazilian trade. Brazil will probably double its oil output over the next few years, but they have problems with corruption. Ricardo says that Mexico has not been active in external affairs because it’s been distracted by its drug mafia. Richard H.: Our lack of a regional trade policy has been a mistake. We haven’t gone beyond NAFTA the ways that we should. NAFTA is one of the reasons Mexico’s economy survived the meltdown. And the next strategic area of partnership will be energy. Put together Canada, US, and Mexico and you get 18M barrels of oil a day.
Cuba? Ricardo: the poor people there are in a terrible situation. And the American blockade — an absurd thing — is the main reason. Castro would have been out a long time ago.
Q: What was your prior election — so close — like for osmeone in the private sector?
Ricardo: The election was so close because the PRI put forward a terrible candidate. Andres Manuel Lopez Obrador, the Democratic REvolution Party candidate, did a good job as mayor of Mexico City, and would do fine as president.
Q: Landscape for emerging entrepreneurs?
Ricardo: A year ago we started a project for women entrepreneurs. In one year, we’re up to 900,000 women. Entrepreneurs tend to go underground because it’s too hard to be legal and pay taxes and social security. It’s complicated to set up a new business. Forms, taxes. We should simplify business for small corporations. Richard H. adds that it’s become simpler over the past few years.
Ricardo: People say we charge too much. But it’s for small amounts. 80% of $100 is only $80.
WI: That’s a lot.
Ricardo: For small loans, the transaction costs are high.
WI: ou need to fix that to get more entrepreneurship.
Ricardo: You fix it by making more credit available.
Ricardo: The govt has not made a level playing field for telecom companies. And how are we going to bridge the digital divide except via mobile?
Q: How’s the tourism business been affected?
Ricardo: You’re missing something good and you should go. Nothing bad will happen to you. They’re not going after tourists. Best golf in the world.
Q: Why is it still under travel advisory from the State Dept?
Haas: Some areas are more dangerous, e.g. Monterey. The State Dept. is conservative.
Ricardo: Mexico is a very large country. It’s totally different in different places.