Category Archives: Competence

An Antidote For The Folly Of Government “Investment”

As we’ve discussed previously, efficient systems require feedback. Without the feedback of the pain that comes from making an incorrect decision, bureaucrats have no incentive to be good shepherds of taxpayer dollars.

For example, the federal government “invested” $527 million in the solar energy company Solyndra. These dollars have been (according to various accounts) diverted to the pockets of Solyndra corporate officers, squandered, kicked-back to corrupt Obama administration officials, or (at best) lost in a noble effort to put Americans back to work. In any event, taxpayers have seen $527 million of their money go down the drain.

The reason why this sort of outrage happens when the feds “invest” is simple: it’s not their money. As we all know, it’s easy to invest/gamble/have parties with other people’s money. Therefore one could reasonably ask, why not make it a requirement for every government official to have a stake in the outcome of every “investment”? (This is just for argument’s sake. Since there is no apparent Constitutional authority for the federal government to funnel taxpayer money into private enterprises, Solyndra-type expenditures should not even be taking place.)

In other words, if the investment is a bust, as was Solyndra, then the loss comes out of the bureaucrats’ pay checks. Let’s see, $527 million divided by approximately 16,000 direct Department of Energy employees equals about $33,000 per employee. Wow, no bonus this Christmas!

What if the investment is a success? Based on the government’s track record that would be highly unlikely, but if it should ever occur, we the people can work out an appropriate bonus.

-Ed Walker


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ET EXTRA: Why Medical Care Is So Hazardous

“…as much as 90 percent of the published medical information that doctors rely on is flawed.”
From “Lies, Damned Lies, and Medical Science,” by David H. Freedman, 23 Aug 2011, The Atlantic

ET Corollary: Don’t be afraid to ask your doctor probing questions, to challenge his/her assumptions, and to do your own research.


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Books, Magazines, and Seminars: Who Do You Trust?

The value of what you learn is dependent on the character and competence of those from whom you learn. If the articles and books you read are written by truly reputable authors, then the odds are good that you will absorb some valuable knowledge. But how does one verify character and competence?


A background check, using a reputable person or organization as your guide, is a good way to identify those who are less competent at what they do. Well-intentioned and honest but unqualified folks may perform poorly, but they do it without guile, creating a paper trail of unflattering reviews that allow us to adjust our expectations. You may even want to hire Joe the painter because of his rock-bottom price, even though you’ve learned from his past customers that when Joe is done you’ll find your windows painted shut.


On the other hand, those with low moral character tend to be less visible, because they are adept at escaping detection. Performing competently is not their real goal, so their offerings may be completely wrong and even dangerous: seminars on why you should invest in their business; books on losing weight without reducing calories or exercising; and articles on how to win the lottery or find the perfect mate.

Smiling Faces Sometimes Tell Lies

Low-character predators convey an engaging personality, adopt honorable professions (sometimes obtained with fraudulent mail-order degrees), and are fluent with phrases that may sound scientific to a non-scientist, but are actually gibberish. They have an excellent understanding of human nature and you want to believe them. You want to make them your best friend, trust them with your life’s savings, even marry them. You’ll find these charming frauds throughout society, and their intent is to make you part with whatever you have that they want. Many of them have a favorite saying:

Trust Me

Therefore, although an article, book, or seminar may have the trappings of authenticity, beware that it could easily be bogus, because fraudsters are master mimics of respectability. Before you order that weight-loss product touted in an article by a celebrity author, or sign up for that “ten simple steps to great wealth” seminar, insist on proof of past performance to confirm that the author or lecturer is truly worthy of your time and money.

Sometimes it only takes a few civil well-placed questions to weed out the lower-level ripoff artists. Here are some examples from personal experience:

1. The “Too Good To Be True” Scam:

While researching a dubious claim for a product, I asked a sales rep, “Can you provide a report from an independent testing company that proves the effectiveness of your all-electronic water purifier?” After some attempts to deflect me to the company’s own test results, it was admitted that the answer was no.

2. The “You Can Trust Me Because I Know Your Neighbor” Scam, Version 1:

I answered a knock on our door to find a scruffy man in workman’s clothes who said, “Hi, I can give you a good price for trimming your trees. I’m going to do the same for your neighbor next door, um, um…” He was obviously stalling, waiting for me to say “Mrs. Gibbons?” so he could then say, “Yeah, Mrs. Gibbons,” but I just waited. He finally stuttered some more, “Um, um…” and then laughed and walked away.

3. The “You Can Trust Me Because I Know Your Neighbor” Scam, Version 2:

The smiling collegiate-looking young man at the door said he was collecting money for a neighborhood student’s field trip to Europe. “How nice,” I said. “Please give me the student’s name and phone number so I can call to make arrangements to give them a donation.” He walked away.

4. The “I’m Well-Dressed And Articulate So You Can Trust Me” Scam:

A professionally-garbed man approached us in the early evening on a street in St. Augustine. With polished grammar, he politely requested a short-term loan to get his car out of a garage. “I’m so stupid;” he said, “I left my wallet at home.” I sympathized and then asked, “What’s the name of the garage?; I’ll call and give them my credit card number.” He tried a few more gambits but I insisted on dealing directly with the garage. He finally smiled and walked away.

For another example of the audaciousness of frauds, reprinted below is a true story from a prior issue of The Design/Analysis Newsletter:


Sightings is a collection of true experiences as reported by credible sources

Charlie the Consultant was advised that he was to start reporting to Pat, the new Director of Manufacturing who had been hired to launch the product Charlie had designed. Charlie attended the initial one-on-one meeting with Pat, and half an hour later left, feeling puzzled — very puzzled. Pat had not asked Charlie any pertinent questions concerning the product, and in fact seemed to be in a hurry to get rid of Charlie.

Charlie returned to the office and dug out a resume of Pat’s that had been circulated earlier. Although Charlie had been asked to review the resume, Pat had been quickly hired before Charlie had the opportunity, so Charlie had just filed it away. But now he gave it a good look, and frowned. The resume was one of the worst he’d ever seen (and he’d seen quite a few), and did not appear at all to reflect the background of someone who claimed to have been head of manufacturing for an electronics firm.

Charlie asked an associate — someone who possessed particularly good investigative skills — to check out Pat’s claims. It soon became apparent that Pat had never been a Director of Manufacturing, nor for that matter director of anything. Pat was a fraud.

Although Charlie had not yet confirmed some of the details, such as the bona fides of Pat’s supposed BSEE degree from the Southwestern University in Arizona, Charlie had more than enough evidence to alert his client, which is what he did. But to Charlie’s surprise, rather than being congratulated for helping avoid a terrible mistake, Charlie was instead chastised. “We’ve checked him out and he’s okay,” said the client, blithely ignoring the results of the investigation. Charlie replied, “Did you even check out his academic background?” ”Of course,” said the client angrily, “He showed us his diploma.”

After a few more terse comments, Charlie decided that, for whatever reason, his client was not capable of looking at the situation rationally. Perhaps it was because the client had earlier released an announcement in the company newsletter informing the shareholders of the great new manufacturing director that had just been hired. In any event, Charlie resigned.

Shortly thereafter, Charlie received confirmation that Southwestern University had been a scam, a diploma mill that federal agents had investigated and shut down back in the eighties. It was basically a post office drop where you could mail in a couple hundred bucks and they would mail you back a degree. Charlie wondered why Pat didn’t spring for fifty dollars more and get a doctorate.

Some months later Charlie heard that the locks on the doors of his ex-client’s facility had been changed, at about the same time that Pat was fired.

Next Post:

Advice From Professionals: Who Do You Trust? (Part 2)

-Ed Walker


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