the global warming beat goes on
I don't know if anyone is still looking at the Brainstorm blog, but I thought I'd point you to the article I wrote that is largely a summary of the global warming panel I did at the conference: http://money.cnn.com/2006/07/12/news/economy/pluggedin_lashinsky.fortune/index.htm. Enjoy.
Politics Lost: Has the U.S. political system been hijacked by the pros?
While Time Magazine's Joe Klein assured a packed audience that some of his "best friends" are political consultants, he bemoaned a shortage of politicians who have faith in the public - and in themselves - and are willing to buck these advisers. And he denounced opinion polls as the "crack cocaine" of politicians (and of political reporters, his panel-mates offered).
Likewise, US News editor-at-large David Gergen complained that today’s "leadership class is failing us… pushing a lot of problems down the road" - in contrast to the World War II generation of leaders who were willing to cross party lines to solve problems.
That left Bush media guru Mark McKinnon and Clinton pollster Mark Penn to defend themselves - and the impact of their professions on a system that nearly everyone agrees has become polarized and short-sighted.
McKinnon dismissed Klein's thesis, noting examples of leaders who acted on core beliefs rather than polls - like Bush's pursuit of social security reform - and weren't applauded for it.
Penn argued that public opinion polls actually enable political leaders to see beyond the biases of small staffs/advisers, providing a window to the concerns of the broad public. Polls, he said, act as a "public desk" that break through the elitist noise of interest groups and advisers to examine the concerns of real people. Posted by Nina Easton
McCain on Guantanamo, global warming, immigration, Iraq, Iran, creationism, gay marriage, and flag burning
John McCain's arrival at Brainstorm at first went largely unnoticed -- coming as it did just as Germany and Argentina began overtime penalty kicks in their quarterfinal World Cup match. But it didn't take long after Germany's narrow victory for the Arizona Senator and presumed 2008 Presidential candidate to make his way to center stage.
McCain (who no doubt gets his way when it comes to speaking format) kicked off the scheduled "Q&A" by speaking from the podium regarding two hot political issues, namely the Supreme Court's just-announced decision regarding the rights of detainees in Guantamo Bay (he pronounced himself "not surprised" and glad the ruling had "unstuck" the process), and the unfortunate state of carbon emissions legislation he had co-sponsored with Connecticut Senator Joe Lieberman (the media should have "paid more attention to it.")
The Senator then fielded questions from Aspen Institute chief Walter Isaacson and Fortune's Eric Pooley, earning enthusiastic applause for his positions on global warming, immigration, and the need for a more bi-partisan spirit in congress -- and even on the U.S. military situation in Iraq. Audience reaction appeared somewhat less cheery, however, when McCain explained his support for a constitutional amendment to ban flag burning and his artful dodge on the subject of teaching creationism in schools ("I don't see what the issue is," and "I'd leave it to the school board.")
Click here for a somewhat rough transcript of Senator McCain's remarks.
Ayaan Hirsi Ali and Lesley Stahl
I'd read about the former Dutch parliamentarian Ali before, but seeing her in person was electric. This young, charasmatic woman is a star. I'll make a note (here!) to put up some links to some good articles about her if people want to catch up on her incredible story.
Equally inspirational was seeing Lesley Stahl in person. She was the same on stage as she is on 60 Minutes: tough, intelligent, penetrating. Stahl has this incredible style where she firmly and respectfully directs the conversation, condoning no BSing and eliciting interesting responses, even when she's interviewing someone she so clearly admires, like Ali.
I'd love to be half the interviewer Lesley Stahl is.
Digital Life On Steroids
We had a robust chat during our breakfast panel Friday morning that pursued several strands, among them whether our lives have become too chaotic as a result of the Internet.
What was pretty cool, and this was a Brainstorm moment, actually, was the amount of Internet history we had in the room. Stewart Brand, founder of the first online "community" the Well; Yossi Vardi, founder of instant-messaging pioneer ICQ; and paid-search inventor Bill Gross were among the luminaries who showed up for our early-morning chat.
We certainly didn't solve anything - another Brainstorm moment - but at the same time we aired some interesting divisions. Some of us, myself included, wondered if the "steroids" of our digital life doesn't get a bit much from time to time. (Venture capitalist John Fisher talked about the "tyranny of email," for example.)
Others, like Microsoft's Gary Flake and Brand himself, waxed eloquent about how our lives are only going to keep getting better and better as a result of digital steroids.
The entertaining Vardi informed us why we like instant messaging so much. The collaboration entailed in IM actually releases dopamine, the pleasure chemical, he said. Amazing. Smart people, interesting ideas.
Brainstorm Revealed - A trip to the Eisner's
Germany vs. Argentina II
As the game progressed and went into extra time, the crowd watching grew to more than 100 -among them Sen. John McCain - causing Brainstorm organizer David Kirkpatrick to briefly consider rejiggering the schedule.
He didn't, and a lot of the crowd (including me) went back to Brainstorm business when the game went to PKs.
Brainstormers do their bit for global warming
There is a certain irony in 300 people traveling from around the world on CO2 (that's "cee oh two") spewing jets and cars to attend a conference in Aspen where one of the main topics is how to solve the global warming problem.
But this year's attendees need not fret because Bill Gross, the CEO of the Pasadena, CA start-up, Energy Innovations, has made the Brainstorm conference carbon neutral.
Gross estimates that the attendees would add some 750,000 pounds of carbon dioxide or greenhouse gas to the environment from their travel and from the energy they burn up staying in hotels and airconditioning the meeting rooms.
To conteract the effect of this greenhouse gas, Gross paid to have trees planted and alternative energy generated. On the panel, Green Is The New Bottom Line, he urged every individual to calculate their own carbon footprint (the amount each of us generate each year in greenhouse gas) to buy renewable energy certificates through carbonfund.com, a website that helps reduce the cost of clean energy.
Gross also added that his new solar device, the Sunflower, is now on the market and will help make alternative energy more affordable. The device, a panel of mirrors, concentrates sunlight and makes solar panels more efficient. Gross hopes the Sunflower, coupled with other breakthroughs in photovoltaics, the science of turning sunlight directly into electricity without the release of any greenhouse gases, will soon become competitive in price with fossil fuels such as natural gas and coal. Posted by Brian Dumaine
Drive for an AIDS vaccine
Let's get real about AIDS, Dr. Seth Berkeley said at a Brainstorm tutorial. Changing behavior may be a 100% certain way of preventing the disease but only one thing will bring the epidemic to an end - and it's not abstinence, not condom use, and not a still-undeveloped microbicide for women, as important as all those approaches are. The only long-term solution is an AIDS vaccine.
As founder and head of the International AIDS Vaccine Initiative (IAVI), a global public-private partnership, Dr. Berkeley explained why developing a vaccine is an incredibly complex, difficult and time-consuming task.
Think about it - you need to persuade many thousands of healthy people to take medicine that may or may not work, and may or may not have side effects. The legal and moral issues are daunting, and it's no surprise that very few drug companies are interested.
The good news is that 30 potential vaccines are in the early stages of testing, and a couple of large human trials have begun. The Gates Foundation has been a big supporter of Dr. Berkeley, and Warren Buffett's money will help, too.
And hey - we developed vaccines to all but eliminate polio, smallpox and measles. We ought to be able to do the same for AIDS, the most lethal human plague since the 14th century. Posted by Marc Gunther
Rwanda a model for Africa?
Africa's economy looks better than it has in many years - overall GDP is growing 5%, inflation generally is below 10% and tourism is up 10% this year vs. 5% globally.
Paulo Gomes, the World Bank's executive director in charge of 25 Sub-Saharan countries, laid out the reasons and the lessons in his tutorial, "Africa: The Rising Economy." Of course, high oil prices are spurring economies in some countries (Angola, Chad), and high mineral prices are a windfall for others such as Mozambique, South Africa, and Zambia. But even countries not dependent on such commodities are growing.
Peace, quite simply, has a lot to do with Africa's brighter outlook. "Ten years ago there were 16 active conflicts, and now we have four," Gomes says.
Is Africa's rise sustainable?
Of course, African countries tend to be powderkegs, and a global recession, Gomes says, "would be very very painful for Africa."
Direct foreign investment, not foreign aid, is the key to sustainability. The best model may be Rwanda.
John Gage, Sun Microsystems' chief researcher, talked passionately in the session about his quest to determine which African country Sun should put its money into.
"I went around the country and kept asking people, "Have you been asked for bribes?'"
Rwanda emerged as the least corrupt country, at least by Gage's on-the-street survey. Gage and Sun are now helping to get Rwanda wired for cell phones. They're working with a Boston investor who bought Rwandatel. The goal: Get cell service across Rwanda and reduce calls to 10 cents a minute, vs. 45 cents in the rest of Africa.
Connectivity - the theme of Fortune Brianstorm - is a big step toward sustaining growth. Posted by Patricia Sellers
Sandra Day is watching, too
Just got a report from Jaime Florcruz, CNN's Beijing bureau chief. He's at the Aspen airport and says he's watching the game with Sandra Day O'Connor. She's a big fan, apparently. Is there nothing this woman cannot/doesn't do?
Germany vs. Argentina
While most of the Brainstorm crowd is in the main tent discussing "Capitalism Under Fire," about 40 of us are sitting under another tent nearby watching "Germany under fire," as one of my neighbors just said. We are, however, still getting audio of Bob Nardelli et. al. talking about the difficulties of doing one's job while getting paid millions of dollars. Which is marginally better than the game commentary you get from ESPN.
Net Neutrality: The debate continues
The "Net Neutrality" issue -- whether or not companies like Google and Yahoo should have to pay the big telecom carriers to ensure that their services are delivered in a timely fashion to consumers -- continued to dominate chatter at Brainstorm.
Stephanie Mehta already has posted about how a conversation on Thursday about the cell phone revolution turned into a debate about Net Neutrality. Christopher Sacca of Google said he feared what would happen if "the people who own the networks can make choices on what customers can or can't see" and added that even though Google does not always see eye-to-eye with its online rivals, Net Neutrality is something that Google, Yahoo, Microsoft, eBay, Amazon and IAC (which owns Ask.com and many other online properties) all agree on.
But former Motorola CEO Christopher Galvin, who at first said he was unaware of the term Net Neutrality (a confession that was met with some snickers in the audience), argued that network providers should get paid back for their investments in broadband infrastructure.
This debate spilled over to Friday morning's breakfast panel discussion about where VCs were putting their money. Morgan Stanley Internet analyst Mary Meeker sided with the Internet giants, a stance that did not please the woman sitting next to her, Citizens Communications CEO Maggie Wilderotter.
Citizens, one of the nation's largest telecom carriers focusing on rural markets, obviously has a stake in how the Net Neutrality debate pans out. Wilderotter conceded that AT&T CEO Ed Whitacre is probably taking too antagonistic a stance against companies like Google. But she, like Galvin, said that phone companies have every right to "monetize their networks."
Stay tuned to see how this all pans out. But based on the conversations at Brainstorm, expect this to be a highly contentious battle between Internet behemoths and the telecom titans for months to come.
Inside the Fed
The Fed did exactly what everybody thought it would on Thursday and the market rejoiced. But Alan Blinder, a former vice chairman of the Federal Reserve and now an influential economist with Princeton University, thinks that Wall Street's euphoric reaction was a bit overdone.
The two of us talked about the Fed over glasses of merlot during dinner at the Eisner's insanely large ranch Thursday night. (Tough life, eh?) Blinder said that he thought the market often makes the wrong call about the Fed at first. And he said that he read Thursday's statement and was not convinced that the Fed would pause just yet. He said that the Fed, by commenting on slowing economic activity, is clearly signaling that it may pause soon but that the market should never assume things with the Fed.
Blinder joked that he always found it amusing to see how the market would react to interest rate announcements when he was at the Fed. He said he would often guess how the market would respond following the announcement and found that it was often difficult to accurately predict what the stock and currency markets would do. The bond market was usually easier to figure out.
As for his former boss, Blinder said that Alan Greenspan pretty much spoke in private the same way he did in public. In other words, he was just as incomprehensible behind closed doors. Blinder thinks that it's a good thing that new Fed chair Ben Bernanke is more plain-spoken but that it will take a few months for Wall Street to get used to the fact that Bernanke, unlike the Maestro, doesn't speak in riddles.
Revenge of the dot-com bubble?
I had an interesting one-on-one chat with Reid Hoffman, the co-founder and CEO of professional networking service LinkedIn. Hoffman, who is also on the board of several other private Net firms such as Mozilla and SixApart and is an investor in Facebook, Friendster and Digg, is a little worried that too many venture capitalists are chasing companies with bad business models.
"The consumer Internet landscape is between a bubble and frothy," he said. Hoffman said that he still believes in consumer Internet companies but that thanks to the success of sites like MySpace, YouTube and Wikipedia, there is a rush to fund "me-too" projects.
"The thing is that with so much money being thrown at the Internet, so many half-baked ideas are being funded," he said. "Look at the profusion of photo-sharing sites. Only a small percentage of them can become really meaningful."
Hoffman said he also doesn’t think that podcasting is a legitimate business model and that companies that are just getting into blogging now are probably too late. With that in mind, he said he’s become a lot more selective and cautious when it comes to looking for new companies to invest in.
Our conversation came to an end as MySpace CEO Chris DeWolfe approached us to introduce himself to Reid. Strangely enough, the two had never met. DeWolfe was very curious to hear about how much money LinkedIn was generating from ad sales and whether the company had a significant presence beyond Silicon Valley and Wall Street.
DeWolfe and Hoffman promised to meet up at another time. And it makes you wonder ... as all those MySpace teens start to grow up and get jobs, maybe they will need a professional networking service like LinkedIn. Hmmmm.
China's Oprah talks censorship with Meeker
How to convince Chinese government cyber-snoops to keep their mitts off their nation's Internet?
Beijing entrepreneur and media diva Hung Huang - who's been dubbed the Oprah of China - found a persuasive argument in comments of Morgan Stanley tech analyst Mary Meeker. In a panel discussion of the explosive growth of China's Internet, Meeker reckoned that China, with 111 million Internet users and 393 million mobile phone users, has already overtaken the US as the largest consumer of telecommunications products and services.
And yet, Meeker noted, the market performance of Chinese IT companies lags far behind their potential: total market capitalization of Chinese Internet companies amounts to less than $15 billion - half the market cap of Yahoo Japan.
Why the mismatch? The key reason, says Meeker, is investor uncertainty about state censorship and over-regulation.
"If I were China"s Information Minister," said Hung, "I'd be a lot more impressed by claims that Chinese companies are undervalued and that censorship hurts economic competitiveness than I would by Western complaints about human rights."
Hung promised to post that and other observations from the morning's panel on her own blog, which is one of the most the most popular in China.
"I want to do it as an experiment," she said. "Let's see if it gets censored."
The Great Cellphone (And Broadband) Debate Continues
Justin Fox has already filled you in on the ongoing Brainstorm debate about the quality of U.S. mobile networks. (Thomas Hazlett thinks we're doing just fine, others wonder why we lag Europe and Korea.) That debate - and a continuing discussion about the underwhelming broadband penetration rate in the U.S. - raged on at the Connected Without Wires panel.
One audience member complained that he couldn't complete his 20-minute drive to work without multiple dropped calls. Chris Sacca of Google, no appologist for the big phone companies, was nevertheless sympathetic to their situations. He's the guy working on trying to develop a free wi-fi service in San Francisco, and he recalled that one San Francisco official actually was proud of the fact that the city hadn't authorized new cell sites in recent years: No wonder our intrepid Brainstormer's service suffered.
Somehow this discussion about wireless moved into a conversation about 'Net Neutrality - legislation that Google and others are pushing to ensure that broadband providers like AT&T, Verizon and Comcast don't charge extra fees to content providers to ensure, say, faster delivery of their content to end-users. Many people feel that the heart of the issue is that the telcos in particular are looking for ways to recoup the billions of dollars they are spending to deploy fiber to neighborhoods and homes for ultra high-speed Internet - the kind of stuff you can run video over. "AT&T says it spends hundreds of millions of dollars to deliver my service to consumers," fumed Sacca. "Well, I spend hundreds of millions of dollars, too."
Alas, we at Brainstorm didn't come up with a solution to these problems. But the 'Net Neutrality issue continues to be hot in Washington, and we'll be watching to see how it plays out.
Vinod Khosla offers Shell an ethanol deal
During a discussion on energy resources this afternoon, technology-guy-turned-biofuel-backer Vinod Khosla offered a deal to Royal Dutch Shell CEO Jeroen van der Veer. Khosla said he'd be willing to sign a long-term fixed-price contract guaranteeing to supply Shell with ethanol. The price would be set to allow Shell to retail the stuff for $1.99 a gallon at the pump and make a profit. Or something like that--I was busy moderating the discussion, so I didn't take notes.
Afterwards I saw Van der Veer and Khosla sitting in the shade of a tree on the Aspen Institute grounds, deep in discussion. So if anything comes of this, you read it here first.
Brainstorm blogger roundup
Despite a somewhat spotty wireless signal, the blogosphere is thriving here at Brainstorm. (Says blog pioneer Dan Gillmor, "The next conference I go to that has a consistent WiFi signal will be my first.") For your convenience, we offer a roundup of the blog activity, in no particular order:
Who are we missing? Please advise.
It was 7:30AM, a Breakfast Roundtable entitled "Relations Between the Arab and Western Worlds--Can they improve?" The panel was stacked with big names (Albright and Queen Noor among others) and so the room was filled to the brim. The Grand Mufti of Bosnia sat on the periphery. A few chairs down, separated by the door, was Sandra Day O'Connor.
The Mufti took out his card and a piece of paper and passed a note down the line to the Supreme. It said, "I wish I had a copy of the United States Constitution." Sandra Day received the note and smiled at the Mufti, who bowed slightly. Then she reached into her bag and pulled out her pocket copy of the Constitution (and the Declaration of Independence.) She wrote a note on it to the Grand Mufti and passed it back through the crowd.
Yunghi Kim, our intrepid photographer, has been up since dawn tracking Brainstormers. We offer you some candid shots, and propose an experiment in collective intelligence for those in Aspen, namely caption writing. Here's how it works: Following are some shots from yesterday evening and this morning (and there will be more to come.) Were you at the meeting? Do you know the subject? Add your insights simply by adding a comment.
Living with global warming
My panel, concluded earlier this morning, was a too-fast romp through some real, practical things we all can do to reduce global warming. I already published a preview earlier this week on what some businesses are doing about global warming. The big theme from today's panel was carbon neutrality - the concept that every person, government and business can be carbon neutral by making sure that for every action contributing carbon dioxide to the atmosphere there is an offsetting reaction to neutralize it. My takeaway: If you want to be carbon neutral you literally can write a check to purchase offsets to your own waste. It sounds a little kooky, but this is totally worth exploring. We filled up an imaginary white board of ideas during this panel. Watch Fortune.com for an entire Plugged In column from me on the subject.
What the kids are thinking
Julie Schlosser hosted a kick-ass breakfast panel this morning about our co-called sped-up youth, in other words, how kids are living faster lives than we oldsters did as a result of their use of the Internet. We actually had some college- and high-school-age participants. They agree that their lives are different than the previous generation's. They use IM, for example, to keep up constantly with a wide group of friends in a way that the pre-IM generation couldn't. One student challenged Chris DeWolfe, CEO of MySpace, suggesting that News Corp. wants to control the message everyone hears. DeWolfe kidded that Rupert Murdoch was listening to the conversation, then insisted that News hadn't changed MySpace, a debateable point. My panel tomorrow morning, "Life on Digital Steroids," should be a continuation of this conversation.
What's doing in Lebanon
At a panel discussion last night in which the problems of the Middle East featured largely, journalist David Ignatius noted that he is always more optimistic when he is in the region rather than outside it talking. As an example of the cultural ferment that can be seen, he noted that on a recent trip to Lebanon, the hottest ticket was an Arabic version of............The Vagina Monologues. At the same time, 50-Cent, the American rapper, was also sold out.
El Salvadoran President defends CAFTA
Elias Antonio Saca, President of El Salvador, wants to do business. That was more or less the gist of his 20 minute speech, in Spanish. "Things have changed since we signed the peace accord 14 years ago," he said. "We no longer talk about rifles and revolutions. We talk about Internet revolutions." Saca noted that Dell has moved into the country, hiring 1,000 customer service agents, and launching a manufacturing operation. And he wants to do more, which is why he's a staunch defender of the newly signed CAFTA.
"CAFTA is going to add 1.6% to annual GDP," he said. "It has already allowed us to attract $200 million in foreign investment." And all this, of course, means new jobs. President Saca ended with an invitation to Brainstormers. "We want you as leaders of your companies to participate in our project. I invite you to participate in making El Salvador [an even greater country.]"
Stupid Media Tricks
A lively (for 7:30 a.m.) conversation took place during this morning's panel discussion on entertainment in the digital age. FORTUNE's Pattie Sellers immediately put everyone on their toes by asking the panel members to discuss the dumbest (as well as smartest) decision they've made in the past few years.
CBS' David Poltrack was unlucky enough to start things off. At first, he declined to say what his company's dumbest move was. "I'm not going to tell this group. You do know Leslie Moonves?" he joked, referring to CBS' CEO. But he finally relented and said that CBS' recent attempt to create a reality version of ABC's hit "Desperate Housewives", the ill-fated "Tuesday Night Book Club" was CBS' most recent example of a dumb move. The show attracted a lot of buzz when it first aired a few weeks ago but subsequently lost a large portion of its first episode's viewers and has since been shelved.
Movie and TV producer Brian Grazer said his best and worst decision was to produce the blockbuster film adaptation of "The Da Vinci Code." He said he didn't expect there to be such a big backlash to the movie's controversial content.
Ken Miller of Lehman Brothers candidly admitted that he, like many others, fell for the Internet hype back in the late 1990s and 2000. He said he no longer trusts "BS metrics" like page views and unique visitors, which he says have no real relation to cash flow and profits.
Former Disney CEO and chairman Michael Eisner had the audience rolling with his answer. He said "it was hard to count all the dumb moves" he made before zeroing on one high-profile blunder: misjudging personnel.
Activision CEO Robert Kotick joked that his smartest move was deciding to not sell his video game publishing firm to Eisner when he was still at Disney. That comment was also met with a few chuckles.
How is J.J. going to get paid?
A collection of media heavyweights (and middleweights) gathered at Brainstorm this morning to talk about entertainment in the Internet age, and not surprisingly, the discussion turned to protecting the rights -and bank accounts - of content creators. When a company like News Corp. or Disney takes a hit program and repackages it or repurposes it for an iPod or a cell phone, how do the creative types get theirs?
William Morris Agency CEO Jim Wiatt illustrated the problem thusly: Shortly after Disney CEO Bob Iger announced plans to make the television show "Lost" available for viewing on iPods, Wiatt called "Lost" creator J.J. Abrams (a William Morris client, natch) and asked if he had any idea the venture was in the works. Abrams said no, so Wiatt says he then called Iger and asked: "How is J.J. going to get paid?"
Iger, according to Wiatt, said, "I don't know." Wiatt paused and looked at former Disney CEO Michael Eisner, who was sitting across the room and added: "If I had asked Michael he probably would have said: "He's not."
Why Tom Hazlett thinks our cell phones are great
In a previous post, I told of how Thomas Hazlett of George Mason University defended the U.S. wireless telephony system as globally competitive. Several of those in earshot were incredulous at this assertion, given how spotty cell-phone service is here compared with in Europe, Asia, Africa, the Middle East, etc. But time ran out on the discussion and Hazlett never had time to explain himself.
I tracked him down last night, and here are his three reasons why we should be happy with our RAZRs:
1) U.S. wireless rates are among the lowest in the world.
2) U.S. wireless usage (minutes, not the percentage of the population with phones) is among the highest in the world.
3) U.S. technologies (mainly Qualcomm's CDMA) are driving the global wireless business.
The USA: future deadbeat
In this morning's breakfast discussion on U.S. indebtedness (where economist David Li also made some interesting remarks), former Goldman Sachs Asia vice chairman Kenneth Courtis offered this rhetorical question:
"When the current administration leaves office, the U.S. will have an external debt of $6.5 trillion," Courtis said. "Is anyone in this room naive enough to believe the U.S. will ever pay that back?"
No one spoke up.
Google, Microsoft, eBay and Madison Ave. make nice
Their companies may be locked in daily combat, but this morning they chatted amiably with David Kirkpatrick. The panel? Ray Ozzie (Microsoft), Pierre Omidyar (founder eBay, now venture capitalist), Marissa Mayer (Google), and Martin Sorrell (chief of ad giant WPP.) Gary Bolles has summarized the discussion admirably.
The Chinese government as stock picker
Harvard-trained economist David Li, who runs the new Center for China in the World Economy at Tsinghua University, has already emerged as one of the more interesting people at this conference, with two mentions in this blog already.
This morning, at a breakfast discussion I moderated on U.S. indebtedness to Japan, China, and the rest of the world, he broached a fascinating suggestion. He and others in China, he said, have recently been pushing the government to invest some of its massive foreign exchange reserves in "well-managed, resource-deep companies in order to hedge the risk of an increase in commodity prices." That is, it could buy a 5% stake in, say, BP or Exxon Mobil. Li says he broached this idea with BP chief John Browne, who responded, "Why not 25%?"
Give the Mufti a TV program....
Following a few more highlights from last night's dinner panel hosted by Madeleine Albright's (see "Eddie Lampert asks a question" below for more....)
The scene: Former Secretary Albright sits to the far left on stage, a large presence, but significantly smaller, physically, than than the Grand Mufti of Bosni and Queen Noor to her left. The Mufti owes his stature in part to a bright white cylindrical hat, while Queen Noor is simply sporting the sort of lofty hairstyle that only a Queen could get away with, and she does.
ALBRIGHT opens with strong point of view that wins applause. "I believe the United States needs to have a moral foreign policy. Now, that's a little different than a moralistic foreign policy where we're telling everyone else what they should believe."
Eventually, she cedes the floor to the Queen Noor, and then the Grand Mufti who takes the "corporate" group as far back as 1289 -- when the last Caliph was killed in Bagdhad -- in laying out his analysis of the various paths that Islam has tried in its attempts to modernize. The Mufti is clearly a charmer, confessing his ignorance of business repeatedly: "The corporate, you have surplus in your material goods. We have surplus in our spiritual goods. We should do a trade."
IGNATIUS follows the Grand Mufti and gets right to the point: "I saw quite a few Hollywood people in the audience, and I'm thinking someone ought to sign the Mufti up for a TV show."
Eventually, it's time for the Q&A. (The main course has yet to arrive, but the clatter from dishes being served is rising.) Before Eddie asks his big question, Narayana Murthy gets in a good one. Murthy is the Chairman and "Chief Mentor" (read founder) of Infosys, the giant Indian tech outfit. Murthy wonders why he has not "come across a single Indian Muslim" involved in global terrorism of the sort committed by al Queda. Queen Noor's answer make very good sense: "India is a live democracy -- one that is allowing political space for dissidents." This is not the case in the Arab world, she says.
Photo by Yunghi Kim
Eddie Lampert has a question
During last night's big discussion on religion and global politics, led by former Secretary of State Madeleine Albright, hedge fund superstar (and Sears boss) Eddie Lampert got up to ask a question.
All the panelists (Albright, Queen Noor of Jordan, Kenneth Roth of Human Rights Watch, David Ignatius of The Washington Post, and Dr. Mustafa Ceric, the Grand Mufti of Bosnia) had been more or less critical of the Bush Administration's approach to foreign policy, especially in the Middle East. Lampert pointed out that a similarly elite panel in the 1980s would have said the same negative things about Ronald Reagan, yet Reagan's foreign policy approach has since gone down in history as a great success.
"What would have to happen," Lampert asked the panel, "to convince you that you were wrong?"
Albright had a pretty straightforward answer. "The situation in Iraq would have to stabilize to the point that it is seen as a great success." Roth of Human Rights Watch offered a response that was less on-topic but certainly interesting: "The U.S. has to live by its ideals so we can promote democracy and not be embarrassed by it."
I'm used to feeling inadequate at Brainstorm...
Feeling intellectually inferior at Brainstorm is nothing new for me: This conference consistently pulls together some of the smartest, most articulate, most impassioned people on the planet for a 48-hour gabfest that leaves me feeling both energized and exhausted. (I also go home with a really long reading list.) But at last night's opening dinner, I found myself feeling upstaged by a bunch of kids in their teens and early twenties when conference organizer David Kirkpatrick introduced five student fellows who are attending Brainstorm with the assistance of the Salesforce Foundation.
In true Brainstorm tradition, they are doing smart, important work - some at the ripe old age of 18. One young woman is pursuing human rights work from a legal perspective. another is working to improve the lives of indigenous people. One young man has been a spokesman for Israeli-Palestinian issues since he was 13 years old. And another fellow is using computer programming skills to help a non profit track human rights voilations. In all, an utterly impressive young group that reinforced that good old Brainstorm feeling of inadequacy. My only solace: I was sitting at an adjacent table at dinner, and I'm happy to report that I do have slightly better table manners!
Bill Gates' new legal strategy
An awkward moment at the discussion about the competitiveness of the U.S. economy: Professor Thomas Hazlett of George Mason (how about the Colonials' Final Four run?) was talking about the old Microsoft antitrust case and that how he never could understand why Microsoft's lawyers could not make a stronger argument that Microsoft was a company that was challenged every day by new competitors. It turns out that someone from Microsoft was in the room. "I'll pass on that to Bill for you," shot back Gary Flake, a technical fellow at Microsoft.
Later on during the question and answer session, Flake took issue with some of Hazlett's comments about the state of the telecom industry in the U.S., saying that it was "shameful" how far behind the U.S. lagged Asia, Europe and other regions of the world in wireless telecommunications.
But Hazlett cast some of the blame at Microsoft, arguing that "even forward thinking companies like Microsoft are on the wrong side of lobbying," regarding efforts to get the government to invest more in tech and telecom infrastructure.
Khosla versus Brown
Call it the battle of the environmental advocates. Vinod Khosla, the esteemed entrepreneur and venture capitalist, held forth on his plans to replace gasoline with ethanol during the first of two tutorials on the environment Wednesday afternoon. Lester Brown, president of the Earth Policy Institute and author of the recent Plan B 2.0: Rescuing a Planet Under Stress and a Civilization in Trouble, presented his competing view right after Khosla. What we should have done is brought the two together for a green slugfest.
Khosla has become perhaps the best known proponent for ethanol in America. His slideshow, less multimedia than Al Gore's but just as powerful, explains why ethanol can end our addiction to oil. (Khosla was featured prominently in Fortune's January article on ethanol, "How to Beat the High Price of Gasoline. Forever.") Khosla's policy proposals include mandating that 70% of all new cars be able to burn fuel that is 85% ethanol. He's heard all the criticism of ethanol before. To the people who say ethanol will use up all of America's crop land he says that they are assuming no advances in crop technology, which is wrong. Dramatic crop yield improvement is a given, he says. He also notes that the future is not corn ethanol, largely used today as a gasoline additive, but rather cellulosic ethanol, which is made from the garbage of the agriculture world. Khosla thinks his dreams could be realized in a matter of years, if government and industry (minus the oil companies) pull together.
Brown has a different take, to say the least. He sees ethanol production as being incredibly wasteful. Fill up your SUV with ethanol, he says, and you're doing nothing for the environment. Moreover, Brown points out that growing ethanol, any kind of ethanol, requires water and that half the world already is pumping more water than they should be. Countries like the U.S. and China are depleting aquifers so rapidly that there won't be enough to grow food, let alone renewable sources of energy. To be sure, he thinks cellulosic ethanol will be part of the solution. But he worries about the rise of corn-based ethanol creating a competition between fuel and food. He advocates gas-electric hybrids powered by wind-generated electricity, and a carbon tax offset by income tax reductions (now being considered in China and Japan.)
We were so impressed by the differences between these two thoughtful people that we're trying to set up a debate between them Thursday. Stay tuned.
John Doerr haiku
Several Brainstorm attendees gave three-minute talks this afternoon on "Getting It Right." Here's an extremely brief summary of what venture capitalist John Doerr said:
John Doerr is angry.
"Going green should be our next
Big thing," Doerr exclaims.
It's good to be the king?
During Wednesday afternoon's discussion about restructuring the global economy, one member of the audience asked panel speaker Lester Brown of the Earth Policy Institute what he would do if he were king. Brown, after hesitating for about a second, quipped, "King, which is different from being president?"
The comment got a fair amount of laughs from the room, including actress Glenn Close. After the laughter died down, Brown went on to say that more adults need to be educated, particularly about the effects that the U.S.'s dependence on oil is having on the nation and world at large. Brown said that the U.S. has to invest in alternative forms of energy, even going so far to suggest that lowering income taxes while raising energy taxes could be one way to wean the nation off of oil and fossil fuels.
Surprising facts about newlyweds
Diana Farrell of McKinsey Global Institute, McKinsey's think tank, just wrapped up an amazing tutorial called Ten Trends That Matter to Business. It was chock full of startling facts about everything from the growth of the middle class in places such as China, India and Brazil (975 million new households in the next 20 years) to the size of the socially-responsible investing opportunity. But the stat that made the room gasp and titter? Some 12% of couples married last year met online.
Farrell used the newlywed statistic to highlight the trend of social life in a technologically connected world. This is both an opportunity and risk for businesses. Technological connectedness means businesses that do poorly or disappoint consumers will be slammed online. But innovators that figure out how to capitalize on consumers' increasing dependence on the 'Net and their mobile phones for social interactions can thrive. Come to think of it, a good example of this might just be online dating site.
Thomas Hazlett says our cell phones are great
George Mason University economist Thomas Hazlett was part of the same competitiveness workshop that featured the Alan Blinder talk described below. He sliced off a smaller piece of the competitiveness pie, focusing on the U.S. experience in wireless communications.
Hazlett is a contrarian and a libertarian (and probably some other things that end in -rian), so he didn't offer the familiar refrain about how smart the Europeans are and how great their GSM system is. What happened, he said, was that Americans were the wireless pioneers, then fell behind because the FCC was so slow to approve digital wireless licenses. The Europeans moved ahead with their digital GSM, which wasn't better because it imposed the same standards on all wireless carriers, but because it came out earlier. "We allowed a lot more flexibility and a lot more competition among operators," he said. "On the other hand, the Europeans moved quickly and eliminated regulatory blocks." Now the U.S. way is paying off in the form of more innovation, Hazlett argued, although the failure of the federal government to allot more bandwidth for wireless is crimping the industry's style.
Several people in the audience reacted with incredulity to Hazlett's assertion that U.S. wireless policy isn't a total disaster. They told tales of driving through South Africa, or between Jordan and Israel, and getting wireless reception vastly better than that available on Interstate 280 on the edge of Silicon Valley. Hazlett had a response, but I cut him off because I was moderating the discussion and time was up. I'll get the full answer from him later.
Alan Blinder on U.S. competitiveness
Princeton economist Alan Blinder gave a talk on U.S. competitiveness this afternoon. His main point was that the offshoring of services to English-speaking countries with lower wages (India, mostly) is a much bigger deal than most academic economists allow. "The potential shift is massive--dwarfing anything we have seen in recent years. Not dwarfing the industrial revolution, though."
The shift in the U.S. labor force, Blinder said, will be away from services that can be performed remotely (and thus will done where wages are lower), and toward those that demand a personal touch. So instead of skilled workers making more money and low-skilled workers losing out, as has happened over the past few decades, the divide between winners and losers will be more complicated. Brain surgeons and child care workers will do fine; call-center workers and computer programmers won't.
And college professors? "I'd like to think university teaching would be degraded substantially by remote delivery," Blinder said. "But in my heart of hearts I'm not sure the next generation of American academics won't be replaced by lecturers in Bangalore."
Bush and Gore image makers watch The War Tapes
Intense as all the afternoon sessions were today, there was perhaps only one that brought many participants to tears. Documentarian Deborah Scranton screened her unflinching and innovative film, The War Tapes, to a packed crowd, many of whom stuck around for a heated Q&A. On everyone's mind was whether the film - a sort of video diary shot entirely by three soldiers, and directed by Scranton over the Internet -- had in any way been censored. According to Scranton, very little. The interesting thing here, and certainly a testament to the art of the film, is that the audience seemed to come away split over whether the film gave a positive or negative portrayal of the American presence in Iraq. Had we wanted a professional opinion of the political "optics" of the piece, however, we might have quizzed either Mark McKinnon, George Bush's media advisor, or Naomi Wolf, McKinnon's opposite in the 2000 Gore campaign -- both of whom happened to be on hand, though on opposite sides of the room....
4 questions, hundreds of answers
Prior to the Brainstorm conference, participants were asked to respond to four questions:
1. If the collective might of Brainstorm could be channeled to solve a single problem, what should it be?
2. What do you fear most?
3. What three global leaders will have the greatest impact in setting the course for the next decade?
4. What value do you most cherish?
Here is a summary (unscientifically collated, admittedly) of the answers.
1. The single problem to solve: Lots of worried people out there, but two big categories emerged: the global divide between rich and poor; and environmental issues, with global warming at the top of the list. The future of energy -- ie, moving away from fossil fuels in particular, also comes up repeatedly; and the role of business in the world as well.
Some others, in no particular order of frequency: education and literacy; checks and balances in Washington; poverty; hunger; nuclear and other forms of terror; intolerance; Muslim-Christian confrontation; globalization and its discontents; the need for a collective spiritual awareness; clean water.
2. What do you fear most? No clear "winners" here, but again global warming crops up repeatedly. A whole cluster of ideas having to do with intolerance; religious extremism; frustration; fear; polarization. Hard to find a single term for this, but this accounts for a broad array of answers. Some more specific concerns: avian flu; maniacs with money and power; fear itself; nothing at all; nuclear war; inaction; electronic voting; ignorance; political and social gridlock; viruses and biological pathogens.
3. Most important leaders in next decade? A very clear consensus here on two -- the President of the US (either Bush or the next one); and the leader of China (Hu Jintao or the next).
Almost everyone who answered mentioned one or both of these. The third slot is tightly contested with the leaders of Russia, China, India, Iran and Iraq (current and prospective) fighting it out for bronze. Ben Bernanke, Bill Gates; the Google guys; and the hoped-for moderate leader of the Arab world were all mentioned fairly often. Some of the more unusual answers: an unknown entrepreneur; Bill Gates; the global consumer; the prime minister of Sweden; science; John McCain; the chairman of Toyota; the Moral Man; the head of the World Health Organization; chairman of Exxon; Bono; a third-party US candidate; Kim Jong-il; Pat Russo; Narayna Murthy (head of Infosys); the leaders of Liberia and Nigeria; Rick Warren (Saddleback Church); the People, the People, the People.
4. Most cherished value - the usual stuff: integrity, honor, hope, responsibility, sense of humor, freedom, moral leadership, courage.
The view from Beijing
Naturally, China drew a crowd. The takeaways? Yes, China is big, and growing fast, and you should probably figure out how to invest there. And, no, the country is not about to devolve into social unrest. But it may take time to solve the country's equally impressive challenges. Fortune's Clay Chandler (center) grilled Dr. David Li (right) of The Center for china in the World Economy and Victor Yuan of the Horizon Research Consultancy Group. The eloquent Dr. Li sumarized the thing well: "Let me argue there are two implications: we have to be patient with the Chinese situation. Indeed, the Chinese situation is not ideal, but the changes are in the right direction. Patience is one implication, and the second is that the external world has to be positively accomodating to the emergence of China."
UPDATE: Clay Chandler has files the following far better summary of the meeting.
China¹s torrid macroeconomic growth rates belie huge challenges to continued
expansion: How to keep generating jobs for China¹s vast population? How to
create a social safety net and minimize income inequality? How to avoid
fouling air and water, and gobbling energy and other natural resources at
such voracious pace that China overwhelms the rest of the planet? How to
transition from central planning to a political system better suited to a
market economy? For Hu Jintao, running the world¹s fastest growing economy
is turning out to be one the world¹s toughest jobs.
CLAY CHANDLER, FORTUNE ASIA EDITOR:
"Fortune 500 CEOs have come a long way in their understanding of China. At
the 1999 Fortune Global Forum in Shanghai they were still groping, trying to
figure China out. By the 2005 Global Forum in Beijing, they felt assured.
Many had socked billions of dollars into China operations and were visiting
China 4 and 5 times a year. Increasingly, CEOs like what they see in China:
a nominally socialist system where government leaders all want to talk
business, seem to genuinely Œget¹ the global economy and have the
administrative muscle to make things happen fast. A common CEO refrain:
³State-led capitalism ya gotta love it.² Many draw a contrast between
can-do pragmatism in China and democratic malaise in India. But the reality
is a lot more complicated. China¹s leaders are scrambling to keep the
economy growing and hold society together. Topping China¹s development
agenda, the ŒFive E¹s¹: Employment, Equality, Enterprise, Energy,
DAOKUI "DAVID" LI, PROFESSOR OF ECONOMICS, TSINGHUA UNIVERSITY, DIRECTOR, CENTER FOR CHINA IN THE WORLD ECONOMY
"Four paradoxes of China:
1) China is a huge economy, but it¹s also a poor economy, with per capita
GDP of $1700, barely half that of Russia....
2) China is an open economy, in the sense that it absorbs billions of
dollars in FDI, but in fundamental ways it remains essentially closed. Few
Chinese speak English, Chinese society is less open than that of India, and
ideologically, it¹s more insular. By comparison, India is a closed economy,
but an open society.
3) China¹s economy is highly centralized in the sense the central
government oversees all, appoints the political leaders and party
secretaries at the state and local levels. But the local officials have a
lot of power and the government often has difficulty enforcing its will
4) Chinese development seems remarkable stable in the sense that after
more than 20 years of reform it is still a one-party state, in which the top
officials in the Communist party hold all the top government jobs. But at
the same time, Chinese economy has experienced change at a phenomenal rate
-- even changing fundamental aspecits of the official ideology -- under that
China¹s five big challenges:
1) GDP is growing rapidly, but growth is lopsided. More than 44% of GDP
growth comes from investment. Consumption is just over 50% No other economy
has had such lopsided growth. Even in the periods of rapid industrialization
in Japan and Korea, investment never exceeded 35% of GDP.
2) Rising social tension. The current government has raised expectations for
greater equality and social justice.
3) Natural Resources: If China duplicates the lifestyle and consumption
patterns of the US, we will bankrupt the rest of the world in terms of
resources. We have to find new ways of enjoying the benefits of modern life
that won¹t add to the strain on global resources.
Achieving a political Œsoft-landing¹: It¹s widely recognized among
China¹s elites that the current system isn¹t compatible with a market
economy. But the question is, how to liberalize? If China moves too fast we
may create internal problems.
5) Global Leadership: China¹s not used to being a world leader. Today
China¹s interests are embedded in the global economy, and yet we¹re
developing the leadership and negotiating skills commensurate with our
1) Be patient: China is moving in the right direction.
2) The rest of the world needs to be positively accommodating to China¹s
emergence. We have to understand what happens in China matters for the rest
of the world."
VICTOR YUAN, CHAIRMAN, HORIZON RESEARCH CONSULTANCY GROUP
"China is a good destination for investment. The general public has more
confidence in the government¹s ability to develop the economy than develop
good social policy. Several big issues for China to tackle: employment,
social security, corruption. People aren¹t so confident about the
government¹s ability to root out corruption. About 90% of the public trusts
the central government, but maybe on 45% have confidence in the
But there are positive trends: The rise of a younger generation. Chinese
raised under Mao¹s one-child policy are active consumers. Call them
Generation S for single child. They¹ve created a new foundation.
Migration creates new challenges and opportunities. The migrants who come to
the cities are demanding equal treatment. Chinese move from the country to
the city, they move from city to city, there¹s more tourism enabling them to
see the outside world with their own eyes. This is changing the foundation
of Chinese social life."
Sandra Day O'Connor rules!
Ex-Supreme Sandra Day O'Connor scored pretty close to a perfect ten on the compulsory exercises: she spoke clearly and simply -- her thoughts carrying the weight of experience and conviction -- and yet managed at the same time to be very smart. She was interviewed by former Time Inc. Editor-in-Chief Norman Pearlstine. Following some choice excerpts:
PEARLSTINE: It seems of late there's been an attack on the judiciary by legislative and indeed executive branches. What are your thoughts?
O'CONNOR: I'm very concerned about it. When the framers designed our Constitution the most innovative thing they did was separate the three branches. They went to great lengths to ensure that the judges would be independent. I've lived a long time, and in my lifetime I have never seen such hostility toward judges coming from Legislative, and a little bit from Executive, though not as much -- and especially the states. In South Dakota, they've got something called "Jail for Judges." What kind of a system are we going into if that passes? And you can hardly read the news without hearing about "activist judges." I'm not sure I know what that means. I think it means a judge whose decision you disagree with.
PEARLSTINE: What's behind it?
O'CONNOR: Well, there are decisions that people are unhappy about. The sodomy law in Texas; the 10 commandments ruling in Kentucky; affirmative action at the University of Michigan. These things seem to be driving alot of unhappiness.... Back in the 1950s we had the Brown vs. Board of Education which said "separate but equal." That was highly controversial, but over time that unpopular decision has been accepted by American people as correct. That kind of decision would not be possible under the regime that's being urged today.
PEARLSTINE: What do we do in a world where globalization is so much a part of the fabric of society? What deference should we make to foreign laws?
O'CONNOR: That gets us into the area of transnational law. We have so many issues that cross national boundaries now... When we became a country, the Supreme Court under John Marshall made the point that our laws included international law. Our country was very eager then for other countries to know that we accepted international law. Today we're seeing a certain amount of rejection of that principal.... With regards to the citation of a foreign judgement: there is no case from the Supreme Court that a foreign judgement is binding and relevant to our interpretation. But could it be interesting? [Yes.] Transnational law will be more and more an part of the makeup of the jurisdiction of courts in the U.S. just as it is in courts around the world.
PEARLSTINE: You've worked with judges from the Middle East. What's your sense of hope about the area?
O'CONNOR: Let me back up before Iraq if I may.... We had an enormjous amazing situation in the world with the breakup of the fomer Soviet Union because a huge chunk broke off and developed into 26 separate nation states.... Everyone had to write a constitution and create a judicial system.... Many have become members of the European Union.... So this effort succeeded to a huge extent. So we need to do the same thing for other emerging countries, like Iraq.
PEARLSTINE: Is there any evidence that Iraq is moving towards rule of law?
O'CONNOR: Oh, it's too early to ask that. I met with some Iraqi judges in the Hague last year because that's where they felt safe. I was frankly impressed by them: well-educated and committed. They wanted to get back to judging.... I was left with the impression that there are people in Iraq who want to [move ahead.] Right now some of those people are being assasinated, and I'm sure it's giong to be hard to find people to serve in those positions. Right now what they need is security.
PEARLSTINE: On the Internet: How is the court beginning to deal with immense changes that technology is visiting upon us. Does the Internet figure in your life?
O'CONNOR: I don't think we need a whole new system. Judges and courts move slowly. One of the symbols that architect Cass Gilbert created for the Supreme Court are lampposts resting on the backs of tortoises...When I arrived we used strange machines called ATEX machines, and we still had hot lead printing machines in the basement. Now it is possible that we can do legal research right on our computers, and that's such an amazing change. So I think it's pretty good. But I don't do email. I'm not into that yet.
PEARLSTINE: When thinking about the court during your years, many have said that you were following in the footsteps of Justice Powell, that you [ruled on each case without following a clear dogmatic line.]
O'CONNOR: There is some tension among some members of the Court about this question, but I think that everyone would have to acknowledge that here are certain provisions of the Constitution that are written in such broad terms that it is simply not possible to say "Oh, the framers would allow DNA testing," or "Oh, the framers would allow wiretapping." The language of the Fourth Amendment said no "unreasonable searches and seizures." Well, there's no way to look at Thomas Jefferson notes, so there's no way to know. The same is true for the 8th amendment: "cruel and unusual punishment." [At that time,] it probably was alright to execute people who were under the age of 18...
PEARLSTINE: ...or mental retardation
PEARLSTINE: ...and slavery was legal
O'CONNOR: Yes, but then we fought a civil war to pass the 12, 14, and 15th Amendments to solve that problem.
Audience Questions & Answers
Q: [About the ambiguiuty of the Constitution, and whether it should change with the norms of society.]
O'CONNOR: The framers of the constitution never dreamed that it would last as long as it has. Do you know that our Constitution is the oldest that there is in the world today? That would have astonished them. And the reason is - I'll show you - here is the Constitution with the Declaration of Independence. [See photo above.] Basically that's simple enough that most Americans can read it and understand it for themselves. The framers did not intend that we look back at the notes of the Constitutional Convention. The language is very broad - it leaves some room for interpretation.
Q: What is the reticence of the court to being televised. CSPAN has done such a service. Why not the Court?
O'CONNOR: The court is probably the most open of the three branches of government because the Supreme Court is the only one that explains in detail everything that it does. You show me a Senator or a House member or a President that does that. If that isn't open, I don't know what it is.
Now, true, you didn't see it on your television, but is that so critical? Can you not read, or hear? [Proceedings are also broadcast on the radio.] The Justices have some concerns about being seen every day, about lawyers playing to the audience. They don't want to be media stars. They don't want the arguments tailored to the media rather than to the court itself. Everything we do is so documented. [Applause]
Doron Weber, Alfred P. Sloan Foundation: Could you share your thoughts on your role in the 2000 election?
O'CONNOR: I will tell you, nothing the Courts decided changed the voting in Florida. There were three recounts, and in none of those recounts would the end result of the vote for Bush in those counties have changed. So, regardless of the Court's decision, the result would have been the same. The Court's decision was probably not the Court's best effort. Looking back, it could have been explained better than it was.
Photo by Yunghi Kim
Saving the world in three minutes....
First session of the day, and the main tent - a glowing sea of Aeron chairs and flat screen monitors - is packed. Bloggers arrayed in the last row.
Fortune Managing Editor Eric Pooley welcomes the crowd and passes the baton to Aspen Institute president Walter Isaacson who in turn passes the mike to David Kirkpatrick, the closest thing this event has to an M.C.
Kirkpatrick in sandals takes over, toting a Seagull calling device that acts as a "speaker gong," and introduces the first of four three minute speeches.
First up is Seth Berkley of the International AIDS Vaccine Initiative who more or less says our approach to AIDS is still woefully inadequate and mired in "short term thinking," despite the fact that this is now the "worst epidemic since the 14th century." Berkley makes the point that in "in a flat world, infectious diseases are all of our problems."
Next comes John Doerr, General Partner of Kleiner, Perkins, Caufield and Byers. Doerr, one of the world's most charmed venture capitalists, is here to talk about energy independence. Solving these problems, he says, "should be our generation's Apollo moonshot." Doerr thinks the debate suffers from too many rigid preconceptions, and activists overly-wedded to their positions. He then manages to fires off a few nice sound bites: "Technology optimists," he says, suffer from an "innovator's delusion," and he then suggests that a recent GM "gas subsidy" promotion should be called "No SUV left behind." The dismount? "Green tech is the mother of all markets. It is the economic, geopolictial and moral imperative of the 21st century."
Then comes Nabil Fahmy, the Egyptian Ambassador to the United States whose presentation is simple: the pressing problem in the Middle East is not war or violence, but lack of jobs. The Middle East needs to creat good jobs, says Fahmy, and he's looking to the West for help: "My proposal to you is, We live in a global society. Our success or failure will affect you. We need your help."
Mellody Hobson, of Ariel Capital Management took her minutes to lay down a contrarian attack on 401K plans. Americans aren't saving enough for retirement, she said, and the 401K is not a panacea. "The American working class is being put in the driver's seat," she said. "But they never got driver's ed." Bottom line: "My take on this unfolding pension crisis is that unless government takes meaningful steps, we may not pay now but we are certain to pay later."
Last up was Gary Flake, Technical Fellow at Microsoft who won the crowd over by beating up on Public Enemy #1 around here today: United Airlines. (Lots of griping following missed Denver to Aspen flights.) But Flake's message was simply that the top priority must be education. The U.S. educational system, he said, is in a "sorry state," and that "all the other problems hinge on having more education, and better education available." From there Flake, formerly a Yahoo biggie, managed to work his way around to a rather sweeping statement of the power of the Internet to solve some of our educational woes, saying "We will reach the full potential of the Internet when the bulk of human knowledege is online," and further that "humanity will only reach its full potential when humanity has this resource available."
Photo by Yunghi Kim
And they're off
Things are just about to get going at FORTUNE's fifth Brainstorm conference. A lot of people are milling around the Aspen Institute grounds. I'm here early mainly because I want to be first in line for brunch. Others have more elevated reasons, I'm sure.
So who's around? Levin Zhu, head of the Chinese investment bank CICC and son of former premier Zhu Rongji, was just standing next to me talking about his travel misadventures with similarly delayed Star TV boss Michelle Guthrie. This is a major theme here. So why do we hold the conference in a place that's so hard to get to? I guess so people don't leave early. Plus, it's kinda nice here.
Former Supreme Court Justice Sandra Day O'Connor has been sighted searching for former Time Inc. editor in chief Norm Pearlstine, who is supposed to interview her on stage in an hour or so. Venture capitalist John Doerr and Aspen Institite chief (and presumed future Secretary of Something) Walter Isaacson have been striding around purposefully with a several bright young things with clipboards in tow. And, well, enough of that ... food's being served in six minutes.
You can take the man out of China....
...but you can't take China out of the man.
On the morning hike to the Maroon Bells National Forest, FORTUNE Asia Editor Clay Chandler had a brainstorm of sorts. Gazing at a pristine mountain stream, with mule deer on the horizon, against a crystal blue sky, he looked at the water and said, "In China, they'd see this and try to figure out how to dam it and build a factory."
MORE TALES FROM THE BELLS
----Former Supreme Court Justice Sandra Day O'Connor used to lead aerobics classes at the court. She showed in Aspen that she is still pretty fit. As the dozens of would-be hikers wondered how to split up, the Supreme spoke up, "Why don't we have a fast group?" And off she marched.
---OVERHEARD: One guide after his hike: "Well, my group was pretty good. I had a Supreme Court Justice."
His associate replied, "Not bad, once I had Lindsay Lohan."
Photo by Yunghi Kim
Joi Ito, online diplomat
The original Brainstorm blogger was Joichi Ito. The Tokyo-based blogger/investor (blinvestor?) has been coming to the conference in Aspen since 2002 and faithfully recording his impressions. He will presumably be doing the same this year, although he is no longer quite as dauntingly frequent a poster as back in the day.
Ito is a phenomenon, a man who seems to not just know but be friends with an insane agglomeration of interesting people. (He was even buddies with Timothy Leary!) Faithful Malcom Gladwell readers will know him as a "Lois Weisberg type."
I finally met the great man at the Asia dinner referenced below last night. During our conversation, he told a fascinating story about a blog post he wrote back in April 2005. It was the time of the big protests in China against the depictions in new Japanese textbooks of the Japanese occupation of China. Ito's post was a thoughtful little essay about how Japanese educators did in fact misrepresent the Japanese army's behavior in World War II, but that if the Chinese wanted to change this they were going about it all wrong.
Nothing particularly earthshaking or groundbreaking there, but it started a cascade of comments (which can be read at the same place as Ito's post) from readers. Some of the commenters were Japanese, some were Chinese, and a lot were neither. Their discussion was at times heated, but never uncivil. (Ito's regular and calming presence among the commenters surely played a role in that.) By the end it amounted to a remarkably thoughtful and honest take on where things stand between Japan and China, something that is almost impossible to find in either the Japanese or the Chinese media.
Now the comments were all in English, which meant that only a tiny minority in Japan and China could follow along. But now Ito says they are being translated into Japanese, to be published in book form. I'm not holding my breath waiting on a Chinese translation, of course, but what a cool accomplishment.
Asian Brainstormers feast
Time Inc. Group Publisher Michael Federle said last night that the 2007 Fortune Global Forum will be held next year in New Delhi, India in late October. The announcement came at a private dinner in a room at Aspen's Matsuhisa restaurant. Federle joined Fortune International Editor Robert Friedman and Asian Bureau Chief Clay Chandler to welcome Brainstormers from across Asia. It was the first Asia-specific welcome in Brainstorm's history, and nobody will claim that there wasn't sufficient food and drink to mark the occasion. (Note to HQ: please add Nobu Matsuhisa to the 2008 Brainstorm invite list.)
Guest David Li, Director of the Center for China in the World Economy at the prestigious Tsinghua University, spent the previous night 'riding' an airport chaise following a missed connection. Possibly even less fortunate in that regard were a half dozen or so Japanese execs, including Airbus Japan CEO Glen Fukushima, who ran into their own connection troubles in Denver and thus were plodding into the mountains in a rented van as the rest sipped premium sake from tiny bamboo cups....
Star-studded Fortune Brainstorm conference goes on the record
Fortune Brainstorm 2006 is underway, and it will be coming to you live right here through Friday afternoon. Fortune Brainstorm what, you say? Well, this is Fortune's every-other-year event wherein we, the Fortune editorial staff, get to invite 300 or so of the people we're most impressed by to come spend a week talking, eating, drinking, and hiking at the Aspen Institute. Think Sandra Day O'Connor, Lance Armstrong, and Chris DeWolfe (the founder of MySpace) -- and then throw in a few dozen Fortune 500 CEOs. Take our word for it: the list goes on. And on. We've got the President of MTV and the CEO of the Blackstone Group. Silicon Valley is in the house (Doerr, Gross, Khosla) as are biggies from China and India and some of the leading lights of the environmental movement. Get the picture? This week, at least, we've got the name dropping game in the bag. But, seriously, the point is not to preen, but rather to generate a few ideas that might be helpful to someone, somewhere -- hopefully to many people in many places.
The stated theme of the gathering is "connectivity," which is sufficiently broad to allow people to talk about pretty much anything, but narrow enough to get the conversation started. It also gives some of us an excuse (read: air cover) to blog the event. Even an old media shop like ours has figured out that we can't be talking about connectivity in this day and age without somehow digging up a blog. So we plan to bring you the most important and the juiciest of bits from the meetings, even as we bicker over exactly how "on the record" we should be. We certainly don't want the prospect of an over-active blog to put a chill on the open conversation that has been a trademark of past Brainstorms. Then again, if we see the Grand Mufti of Bosnia lunching with Shimon Peres and John McCain, well, we think the rest of the world might be interested. And we'd like to hear from you on the subject.
So, stay tuned: over the next 72 hours a handful of the Fortune editorial staff -- some old school print types, some new media junkies -- will be reporting live from Aspen via this page. We hope it will make for an interesting conversation.
Welcome to the Fortune Brainstorm 2006 Blog.
A stunning day in Aspen
Less than two weeks and counting...
Brainstorm is a labor of love and we've been embracing it since long before Valentines' Day. This year we will be joined by Senator John McCain, Israeli Deputy Prime Minister Shimon Peres, former Supreme Court Justice Sandra Day O'Connor, President Tony Saca of El Salvador, novelist Bruce Sterling, Home Depot CEO Bob Nardelli, Dutch Islamic Feminist Ayaan Hirsi Ali, Madeleine Albright, McKesson CEO John Hammergren, Shell CEO Jeroen Van der Veer, blogger extraordinaire Arianna Huffington, MySpace CEO Chris DeWolfe, and on and on. I get a kick just listing them.
The whole point is to get a conversation going about the problems and opportunities facing the world, with a clear focus on the centrality of business and technology. I hope people on this blog will chime in. We can use all the understanding we can get.
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