Last Saturday, I was a guest on Larry Kudlow’s WABC radio program. Larry’s a good friend and we have been talking quite a bit lately on his TV and radio shows about the ways in which Federal regulations have created the sub-prime mortgage crisis. This is far and away the most underreported aspect of the mortgage story, and aside from Larry’s shows and a few conservative media outlets, such as Townhall, it has been completely missing from the discussion.

That’s a shame, because there simply was no such thing as a developed Subprime mortgage industry until the US congress created it by ordering banks to issue loans to people who were not credit worthy. Community activist groups (such as the Public Interest Research Group and Acorn) and civil rights law firms (such as Miner, Barnhill & Galland) had make their living by accusing banks of racism when the banks hesitated to approve loan requests from minority citizens with poor credit scores. Fair Housing laws, championed by American Heros like Martin Luther King, Jr., had long-ago outlawed the practice of ‘redlining’, which is refusing to sell or rent to blacks in certain neighborhoods. But a new generation of activists modified the concept of redlining, applying it not just to race-based home sale covenants, but to any refusal to lend to a minority member, even for sensible financial reasons.

The Community Reinvestment Act was created as a result. Initially the act was used, not to get banks to lend to minority households, but to get them to cut checks to ‘community groups’. Left of center activist agencies, which had pushed for the act in the first place, used it as a shakedown tool. So long as the banks kept paying off to the activists, the activists would hold off on sending complaints to the bank regulators’ CRA files.

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There’s a lot of talk among entrepreneurs about the value of an idea.  Many entrepreneurs believe that a brilliant idea will spawn a great company.  We read about companies like eBay that took one simple idea – online auctions – and turned it into a powerhouse company.

Yet ideas alone aren’t worth much.  Very few companies, including eBay, became successful based on just an idea.  Unless your idea turns into a patent that no one can replicate, it’s worth nothing until you can add the right elements to it.

Therefore a savvy entrepreneur will quickly try to back their idea with smart management, paying customers, and strategic partners as early as possible in order to build value around their idea.  All of this can be done even before the company is ever officially launched, generating a ton of value in the formative stages.

Smart Management

There’s an old saying that the wrong idea with the right management team can at least have a chance of surviving, but the right idea with the wrong management team is altogether doomed.

That’s because the true value of an idea isn’t about the idea itself, it’s about the execution of that idea.  There were lots of companies that easily replicated the idea of online auctions to compete with eBay.  Do you remember them?  No?  Neither do I.  That’s because eBay’s management team executed so much better than their competitors who had the exact same idea.

You can brag and boast about your great idea, but unless you can pull together a team that can actually pull it off, you’ve got nothing.  Investors are well aware of this fact, which is why they often evaluate their investments on the merits of the management team of a new startup company more so than the business idea itself.

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One of the most frequently repeated distortions about education is that the Commonwealth is inadequately funding poor and underachieving districts while better off districts are receiving unfair state subsidies. For some reason, people are allowed to go unchallenged when they make the claim. However, the assertion is not true and needs to be put to rest.

One relatively simple way to demonstrate the falsity of the notion that the state is inadequately funding the seriously underachieving districts is to compare what actually occurs at the state’s ten worst academically performing districts with what happens at the Commonwealth’s ten best performing districts.

The ten best performing districts were selected on the basis of the percentage of students scoring at proficient or higher on the state’s PSSA tests for the school year 2005-2006. The ten worst schools were selected on the basis of the percentage of students scoring below basic. To score below basic reflects inadequate performance and indicates little understanding and minimal display of skills included in the Pennsylvania Academic Content Standards. Unfortunately, the below basic category can include scores indicating a complete lack of understanding.

Pennsylvania’s ten best districts have around 90 percent of students scoring at the proficient or advanced level in both reading and math. This list includes Hampton, Mt. Lebanon, North Allegheny, South Fayette and Upper St.Clair from Allegheny County; Tredyffrin-Easton and Unionville-Chadds Ford in Chester County; Lower Moreland and Upper Dublin in Montgomery and Peters in Washington County.

The ten lowest ranking districts have over 30 percent of students scoring below basic. Two districts have more than 50 percent of students below basic with a third district over 40 percent. These districts, ranked by the very worst scores, are Chester-Upland (Delaware County), Harrisburg (Dauphin), Duquesne (Allegheny),Wilkinsburg (Allegheny), Farrell (Mercer), York City (York), Philadelphia, William Penn (Delaware), Steelton-Highspire (Dauphin), and Clairton (Allegheny). Note that two other Allegheny County Districts, Sto-Rox and McKeesport, just missed making the worst performer list. And while the Pittsburgh District did not make the worst ten list, there are several schools within the Pittsburgh system performing poorly enough to rank among the state’s worst.

What about the argument of underfunding at the poorly performing districts? The lowest performing ten districts had per student revenues averaging $13,054 (unweighted by size of district) in the 2005-2006 school year. Meanwhile, average per student revenues at the ten top performing districts was $12,866. Of the total funding for the poorly performing districts, the state provided $7,037 per student to the poorly performing districts. Only the Wilkinsburg and William-Penn districts raised more funds locally than they received from the state. The ten lowest achieving districts on average provide only 36 percent of their revenue from local sources.

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In the movie Liar Liar, Jim Carrey plays attorney Fletcher Reede, who’s been cursed with the inability to lie. Every attempt Fletcher makes to lie results in him blurting out the God’s honest truth instead.
Imagine what would happen if an entrepreneur were cursed with the same affliction. What would their pitch really look like?

The Sales Pitch

“Hello, I’m Wil Schroter, and thank you for being the only client that was willing to return my phone call. I’ve borrowed my roommate’s car to get here and you’ll probably notice that while it’s the middle of August, I’m wearing a 3 piece wool suit that I bought for a $1 from a thrift store yesterday.

Since this is the first time a real customer has ever looked at my product, I’d like to pitch you on every last idea we’ve ever had for the product, hoping that one of these ideas is something you’re potentially looking to purchase today.

Unlike pitches I’ve given for previous employers that simply meant a bigger commission in my regular paycheck, this time I’ll be pitching for the money that pulls me out of a mountain of debt. In many ways, your reaction to this pitch will determine whether or not I can pay my rent next month, so I certainly hope you like it.

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Trenchless technology, often referred to as "no dig", is a rapidly growing engineering industry that eliminates the need for surface excavation. Trenchless technology is also used to minimize environmental damage and to reduce the costs associated with underground work. In other words, trenchless technology provides cost-effective sewer asset management. It involves pipe and sewer inspection, rehabilitation, and cleaning services.

"No dig" is exactly what it sounds like. There is no digging up of roads to replace gas and water pipes. When there is a need for pipe rehabilitation in the middle of a busy intersection, trenchless technology allows you to repair the pipe without having to dig up the entire road. Not only does this eliminate traffic problems, but it saves money because you do not need to repair the road that you would normally have dug up.

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