Wednesday, September 17, 2008

Carly on Palin

I'm not a big fan of Carly Fiorina, but she's at least an experienced CEO who knows what a meritocracy of ability is about. She's also one of McCains key economic advisors. Here's what she said about Palin yesterday during a radio interview:

Do you think she [Palin] has the experience to run a major company like Hewlett-Packard?”

“No, I don’t,” Ms. Fiorina said.

I said there's no way she could run Goldman, and I agree there is no way she could run HP. But apparently she's good enough to run the country.

I can't imagine how McCain, Palin and their economic advisors (among them Fiorina) would fare in dealing with the current mortgage problems. Bush is very lucky his last Treasury Secretary is not a dud like the first two. Thanks, Goldman!

Common incorrect belief: it doesn't matter who the president is, or what his IQ is, he'll just bring in the right advisors. Now replace the word "president" with CEO (or Lab Director or Head Trader or Commander in Chief...) and tell me whether you still believe it. Smart people bring in even smarter advisors, and are better at deciding between conflicting streams of advice. As we say in science: first rate people hire first rate people. Second rate people are in danger of hiring third rate people.

...The Obama campaign could not have been more gleeful: “If John McCain’s top economic adviser doesn’t think he can run a corporation,” said Tommy Vietor, an Obama spokesman, “how on Earth can he run the largest economy in the world in the midst of a financial crisis?”

Let me clarify something: I'm not an IQ fundamentalist. There are many smart people would not make great leaders. They cannot connect with average people, lack common sense, are not pragmatic, etc. To be a great leader, one needs all of those qualities and intelligence.

The very fact that Obama was able to defeat Hilary in the primary implies that he can effectively run a big, complex organization. His silicon valley approach to fund raising was novel and wildly successful. Any of the other candidates (D or R) could have tried it, but no one else did. Does that mean Obama is a technologist? No! But he was smart enough to understand and adopt the proposal when it was brought to him by technologists! That's why I think he has the pragmatic smarts to be a good president.

As of the spring: nearly $200 million raised from over a million donors. In February, the Obama campaign reported that 94 percent of their donations came in increments of $200 or less, versus 26 percent for Clinton and 13 percent for McCain.

To understand how Obama’s war chest has grown so rapidly, it helps to think of his Web site as an extension of the social-networking boom that has consumed Silicon Valley over the past few years. The purpose of social networking is to connect friends and share information... A precursor,, helped supporters of Howard Dean organize gatherings during the last Democratic primary season, but compared with today’s sites, it was a blunt instrument.

Obama’s campaign moved first. Staffers credit the candidate himself with recognizing the importance of this new tool and claim that his years as a community organizer in Chicago allowed him to see its usefulness. Another view is that he benefited greatly from encouraging a culture of innovation and lucked out in the personnel department, with his own pair of 20-something wizards. Joe Rospars, a veteran of Dean’s campaign who had gone on to found an Internet fund-raising company, signed on as Obama’s new-media director. And Chris Hughes, a co-founder of Facebook, took a sabbatical from the company and came to Chicago to work on the campaign full-time.


xyetay said...

McCain, Palin, do not have the experience. Granted that Palin doesn't. And I even wonder if McCain is qualified to run a major corporation.

But then are Obama or Biden any more experienced?

Looking at the qualifications of any of the four candidates does not inspire confidence in their economic experience. Sitting on committees making laws is very different than managing a corporation or an economy.

You are obviously an Obama supporter but why should I trust his economic judgment any more than any of the other candidates?

Steve Hsu said...

"First rate people hire first rate people. Second rate people are in danger of hiring third rate people."

Anonymous said...


the quotation about who hires first, second, third etc rate people comes from Andre Weil
(leading 20th-century mathematician).

"First rate people hire other first rate people. Second rate people hire third rate people. Third rate people hire fifth rate people."

gs said...

I gather that Fiorina added that McCain, Obama and Biden couldn't be major CEOs either. "Running a corporation is a different set of things." Literally correct IMO, but astonishingly dumb in political terms: she certainly demonstrated her point! At least she didn't helpfully add that Romney has been a successful CEO...

After Gramm, Fiorina (though Whitman was potentially available). What is McCain thinking?

Anonymous said...

These days it seems that most CEOs can't run a corporation either.

Icepick said...

In February, the Obama campaign reported that 94 percent of their donations came in increments of $200 or less....

Some of that seems a bit shady, though. According to FEC records, one Annonymous Annonymous gave $492 on February 6. S/he did it by making 30 separate contributions ranging from $1 to $100. Why didn't s/he simply write one check and be done with it? (A. A. gave almost $2200 in January in February, over 81 separate contritbutions.)

In case you don't like Annonymous Annonymous (Or people with names like Anonymous Anonymous Anonymous Anonymous, or John Anonymous) you can look at the records of a Ciara Arnette who gave $10 thirteen separate time on September 27, 2007. Or Sara Benjamin who gave $500 on February 1, 2008, but did it over six separate contributions. Or Delon Abrams who apparently wrote six checks of $100 or less on Feb 16, 2008 totaling $250. (Through June 30 Delon Abrams had given $3300.)

There's a lot of this kind of thing going on in Obama's contributions, so don't take that 94% as anything other than some accounting slight of hand. (There's some of this going on in McCain's contributions, but not to the extent as in Obama's contributions. It should be noted that the members of the Anonymous clan, and Annonymous Annonymous, don't seem to like McCain anywhere NEAR as much as they like Obama, as they haven't given him a penny.)

Anonymous said...

***Palin Gets the Financial Crisis, While Obama/Biden are Clueless [Mark Hemingway]

Both Joe Biden and Sarah Palin were asked whether or not they were in favor of the AIG bailout today. Now as Ramesh noted, Biden's decision to blame tax cuts for the wealthy for the AIG bailout is frankly idiotic. But also profoundly troubling is that nowhere in the statement does Biden evince any knowledge of what AIG does or why it was important to be bailed out — and his ignorance goes a long way toward explaining why he's against a bailout that is pretty obviously necessary to prevent a potential worldwide financial crises. (Meanwhile, Obama issued a statement that makes it impossible to discern whether he's for or against the bailout, and said statement even gets AIG's name wrong.)

Now here's Palin's statement today on AIG:

“Dissapointed that taxpayers are called upon to bailout another one,” she said. “Certainly AIG though with the construction bonds that they’re holding and with the insurance that they are holding very, very impactful to Americans so you know the shot that has been called by the Feds its understandable but very, very disappointing that taxpayers are called upon for another one.”

That is exactly right. It's terrible that the bailout is occurring but Palin indicates that she understands why letting the world's largest insurer go down would be a very bad shock to the financial system. AIG underwrites a massive amount of credit default swaps — which are very similar to insurance contracts for debt instruments. While I wouldn't say AIG couldn't have done anything to avoid their predicament, in some important respects, AIG's financial burdens were not created through their own mismanagement so much as being left holding the bag on these contracts after the failings of its customers. Thus the AIG bailout is more about maintaining liquidity — refusing to bailout AIG would not be about addressing moral hazard in the way it would be if the Fed were dealing with an investment bank insolvency.

The bottom line is that Gov. Palin gets it, and veteran Senator Biden is embarrassingly clueless.

09/17 06:00 PM***

From NRO

*As for me, I wish Romney were at the helm; McCain has to appoint him to some position to put Americans more at ease. Romney truly was the thinking man's choice for president, regardless of party.

xyetay said...

>"First rate people hire first rate people...<

I think you are trying to imply that Obama is a first rate people and that the other candidates are not.

Ok, I will bite. What makes Obama first rate? How do I know that he is or isn't?

zarkov01 said...

David Axelrod runs Obama's campaign, so the credit for the successful campaign against Hillary goes to him, not Obama. Moreover, Hillary made some strategic mistakes; going for a super Tuesday knockout, Obama went for points. Remember the nomination was a virtual tie. At this point its not clear than Obama can do anything except give speehes.

Anonymous said...

Do we have evidence that Carly was really qualified to be the CEO of a major corporation?

Steve Hsu said...

"First rate people hire first rate people. Second rate people are in danger of hiring third rate people."

That's the whole point of the 2nd half of my post. Pointing out that he brought on a good campaign manager (and the co-founder of Facebook) hardly undermines that argument. Let me repeat: 2nd rate people often cannot even *recognize* first rate talent when they see it. (Or tell who is third rate.) Look closely at McCain's economic advisors (link from post above) and you will find some hacks (Laffer? Luskin? Hassett?). If you are serious about finding the truth (are you a scientist, or just a hack?), take a careful look and compare to the quote above.

BHO is magna from HLS and was president of the law review. See for lengthy discussion of his IQ versus McCain / Palin.

Betting markets a year ago would have given Obama only a tiny chance against Hilary. So, objectively, he pulled off a huge upset -- like the Spartans holding off the Persians.

That is a greater "executive" feat than anything McCain and Palin have ever done. Who do you think made all the final decisions on Obama's campaign? He's not a strawman taking orders from Karl Rove. He's clearly a thinker. If you don't believe that, read Dreams of My Father, which he almost certainly wrote himself, and imagine, if you will, McCain or Palin writing something of similar quality. The syntax, logic and prose style alone are way beyond what those two could manage.

zarkov01 said...

"Pointing out that he brought on a good campaign manager (and the co-founder of Facebook) hardly undermines that argument."

How do you know it was Obama who recruited Axelrod?

"BHO is magna from HLS and was president of the law review."

So how come Obama never wrote a law review article while at HLS or any article whatsoever since graduation? How would you rate a promising physicist who graduated high in his class yet over the next 20 years didn't publish a single paper? How come Obama will not release any of his academic records either a Columbia or HLS. Why can't we even find out his LSAT score? If Obama is such as hot shot, then show me where he has shot hot? Remember Axelrod runs the campaign and we really don't know who picked Axelrod.

"He's clearly a thinker. If you don't believe that, read Dreams of My Father, ..."

I did and all that comes through is a narcissist. What deep thoughts are in that book? All we know is that the author was a competent word smith.

Now I agree his opposition is pretty lame, but that does not make him a great thinker.

Steve Hsu said...

"How do you know it was Obama who recruited Axelrod?"

The point is not that Obama found him. The point is Obama made the final call to hire him. Like McCain decided Arthur Laffer should be his economic advisor. (Do you know what the Laffer curve is?) That's the whole point of the 1st-2nd rate distinction. When Bush gets a capable Treasury Secretary it's luck (1 out of 3). When Obama gets one it will be because he can tell a first rate brain from a hack. It was no accident that Clinton had Rubin and Summers.

(Someone with an IQ of X has a hard time telling the difference between two people with IQs of X + 2 SD and X + 3 SD. Think about that.)

No one is making the claim that Obama is a top legal scholar (that was never his goal). Just that he is significantly smarter than McCain / Palin. The HLS credentials are easily enough to establish that. For a national-level politico, those credentials put him near the top for intelligence. Ask someone with a top 5 law degree how hard it is to make law review or graduate magna from Harvard.

Yes, maybe Dreams... is narcissistic -- it's an autobiography for god's sake! I ask you just to look at the prose, logic, vocabulary and tell me Obama is not a smart person. (I anticipate now you'll tell me he didn't write it, but I suggest you do your research before claiming that.)

If you want more discussion on this topic, go to (who has, I believe, an Ivy and top law school degree). I don't want to waste any more time on it here.

Note I am not debating ideology here -- that is much more complicated. Estimating basic ability levels of different individuals is not as hard.

Anonymous said...

You are truly confused my friend. Your reasoning on this topic is driven by your political bias.

If Palin can't, then Obama doesn't even have a chance.

zarkov01 said...

By your logic Bush must be smart because he picked Karl Rove, and Karl Rove must really be smart because he ran 3 successful campaigns. One to get Bush the nomination and two that got him elected. Moreover, Jimmy Carter had an even more impressive resume, and yet he was a disaster as president.

You are making too much out of Obama's being at HLS. I know people with the same or better credentials, and I wouldn't trust them to mail a letter. You also need to differentiate between ego and narcissism. One is commonly found in high achievers, while the other is a personality disorder.

Anonymous said...

Bush must be a genius if we recognize that in 2003 he called out the need to regulate these two GSEs. It was the Dems that refused saying it was not an issue.

Going a step further McCain must be a super genius that he called for regulation of these two GSEs in 2005. Again he was rebuffed by the Dems.

Obama and Biden have no clue what is going on with this mess. They are clueless. As a matter of fact the ideas being floated by Biden suggest that he is an ignoramus. Obama has spewed a lot of hot air casting blame but has shown no thought leadership. He shows the same old political gamesmanship that political cronies present. Nothing done but smearing others.

Obama cannot be supported by free thinking beings. he offers us nothing but the same old political games.

Steve I do have one question. How can a smart guy like yourself get so caught up in petty political gaming? Don't you see that Obama is clueless?

Anonymous said...

Rubin gave us Enron and Summers let the unregulated markets pass. Not sterling picks.

Obama picked Biden.

Obama does not economics. I do not care if he gets advisers who get economics, if he cannot sift through their reasoning.

Anonymous said...

"First rate scientist, second rate man; second rate artist, first rate man." -- Nietzsche

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