First-time readers, this blog is set in the future (sometime after the year 2020).  Each entry assumes there has been a 5th revolution in the US — the Revenge Revolution.  More about Revenge Revolution and author, Entry #1.  List and general description of entries to date.  Annual assessment whether Revolution plausible.

Note: most characters appear in a number of entries, with many entries building on previous conversations.  Profile of characters.  You’ll catch on quickly.  Thanks for your time and interest…and comments.

Scene: Jordan’s office in Washington. Jordan meeting with JC, who has agreed to get storylines about causes of the Revenge Revolution for Greenie, a mutual friend.  Greenie is recovering from short-term illness.  Conversation started #191.

Jordan:  “For Greenie’s next article about the Revenge Revolution let’s select a topic that’s less political.”

JC:  “Look, most big societal issues seem to come down to politics one way or another.”

Jordan:  “Probably so.  But some factors causing the Revolution didn’t start as big political issues.”

JC:  “You have a particular topic in mind?”

Jordan:  “Flint, Michigan.”

JC:  “That’s an old story.  Won’t Greenie be beating a dead horse?  Besides you talked to POTUS about Flint.  What’s new?”

Jordan:  “Not much new about the facts.  What is new is that we…societal we…failed realize the underlying cause of the problem.  We failed to realize the cause when it happened.  We fail to realize the cause now.”

JC:  “And, I take it, you think the failure has widespread implications?”

Jordan:  “Right.  There are still many cities with problems very similar to Flint’s.”

JC:  “When the story broke, there was lots of finger-pointing by politicians.  Then people got very angry and Flint finally got a solution.”

Jordan:  “What troubles me is the solution addressed the symptoms, not the cause.”

JC:  “You saying fixing the infrastructure in Flint…and elsewhere…was the easy part?  The Band-Aid?”

Jordan:  “Here we are 5+ years after the Flint problem became public and we still haven’t start addressing the underlying cause.  When are we going to wake up?”

JC:  “Maybe that’s what Greenie should explore and write about – the real causes of problems in Flint.”

Jordan:  “We keep saying Flint but we know the problem is more widespread – look at Detroit, Chicago, Cleveland…and a lot of other cities.”

JC:  “I know there’s more than Flint but it’s a great example that’s still fresh in everyone’s mind.  What did you tell POTUS?”

Jordan:  “If you take personalities out of the Flint equation…”

JC:  “…you mean like that guy you talked about that had it in for Flint — GM’s chairman. Squeaky or whatever his name was.”

Jordan:  “Roger B. Smith.”

JC:  “That’s it, Roger Smith.  I like the name Squeaky better.”

Jordan:  “If you take personalities out of the equation, the primary cause seems to center on US tax policy.”

JC:  “Huh?  Flint and tax policy.  How so?”

Jordan:  “Because tax policy allowed, maybe encouraged is a better term, inflated compensation for senior executives.  The compensation was tax-deductible but hidden in the form of stock…more stock options then.”

JC:  “Aren’t stock options only worth something if the price of the stock goes up?”

Jordan:  “True but shareholders really didn’t understand how much the executives could make if the stock price increased.”

JC:  “So what’s wrong with the executives making money?  If the stock price increases, all the shareholders benefit also.”

Jordan:  “How do you think the execs increased the stock price?”

JC:  “I guess more effective management.  Maybe introducing new products.  I don’t know.”

Jordan:  “What about cutting costs?”

JC:  “Sure you can cut costs some but that only works for a while.  No one ever saved their way into prosperity.”

Jordan:  “Part of the problem at public companies was Wall Street.”

JC:  “You keep confusing me.  I thought Wall Street guys made it possible for companies to grow…and create all that wealth.”

Jordan:  “One thing people need to understand.  Wall Street pushes a stock price higher for increased earnings, not necessarily for preparing to grow the business.  The focus during Squeaky’s reign was short term…and to a large extent the focus today remains short-term.”

JC:  “Keep talking.  I’m still a little confused.”

Jordan:  “For many established companies, generating cash flow was…and is…rewarded more than building for long-term growth.”

JC:  “Why?  That seems like back asswards logic.”

Jordan:  “I think it is back asswards logic.  But for many stock traders, short-term is more important.  Long-term growth is uncertain and requires cash.  Earning often suffer before growth begins.”

JC:  “Sounds to me as if Wall Street cared only about performance today, not really about the future.  And certainly Wall Street didn’t care about the company.  I keep using past tense.  But you’re saying it’s till true today.”

Jordan:  “Exactly right.  People who trade stocks have no emotional bond with the company.  Wall Street’s focus is dollars, not the company or its people.”

JC:  “So now the company execs, who have a boatload of the stock options, need to play the Wall Street game if they want to make money.  Otherwise the options could be worthless.”

Jordan:  “Now you have it.  The execs are the dog being wagged by the Wall Street tail.”

JC:  “Based on what you just described, it makes more sense to cut costs and not spend money for future growth.  Seems so stupid.”

Jordan:  “Pretend you’re a CEO of a big manufacturing company with lots of workers in Flint, Detroit and elsewhere.  And then…”

JC:  “…I look at my pile of stock options and ask myself, ‘How can I make the most money?’  Mmm, maybe I can move operations to Mexico, or China as a way of cutting costs.  And with that thought I shed a crocodile tear for the workers and the cities left behind.  Their problem, not mine.”

Jordan:  “Enlightening, huh?”

JC:  “I never connected tax policy with movement of US companies to Mexico and China…or even to the southern US.”

Jordan:  “Think about the implications of the tax policy.”

JC:  “For the execs, they gain in wealth.  They also walk from any obligation to the workers or the communities.”

Jordan:  “Heads I win.  Tails you lose.”

JC:  “Seems more like the execs gave a one-fingered salute to everyone on the way to the bank.”

Jordan:  “So if Greenie writes about how tax policy helped cause the downfall of Flint and other places, maybe…just maybe…the post-Revenge Revolution Congress will make some changes.”

JC:  “And may…just maybe…people will begin boycotting companies who don’t support US cities and workers.  And with that, I need a break.”