April 2017 – Page 2 – GEORGE ROTHERT

What Would Mr. Carnegie Think?

The University of California-Berkeley recently remodeled its undergraduate library. With the remodel, they have lifted the ban on bringing food and drink inside. There is no longer any danger of books in the library being damaged by spilled food or drink. The reason: there are no longer any books in the library.

As we all know, if it’s on the Internet, it must be true, so the library has been re-styled to serve as a gathering place for students to gather for important discussions, complete with power supplies for laptops and whiteboards for recording vital ideas, and monitors to view work produced in PowerPoint, that scourge of civilized discourse.

What, no Foosball table?

“It’s the wave of the future,” a professor said. “The idea of research in a library is becoming archaic, versus Googling on the Internet. Maybe they’re not accessing the best information with what comes up on Google, but people are used to finding things on the Internet.”

Keeping Things in Perspective

Millions of people took to the streets on Earth Day to promote science as necessary to save the earth. Nearly 900 million people in the world are undernourished. In Syria, 6 million people have lost their homes; another 4.8 million are refugees who have left the county. In the Vatican City, cardinals are outraged that Pope Francis has said that it might be okay for divorced Catholics to take communion.

Writing in his 2016 “Amoris Laetitia” – if you didn’t study Latin that means “The Joy of Love” – Pope Francis said bishops can use their discretion in allowing Communion for Catholics who have divorced and remarried. A few years earlier the Pope said it was probably all right for Lutherans to receive Communion. As if that wasn’t bad enough, he later surmised that is was not for him to judge if gay people could take communion. To conservative bishops in Germany and the U.S. this is not acceptable and goes against what has been Catholic dogma for centuries. The Church does not recognize divorce and so those who remarry are living in sin.

If you’re like many people, you don’t care.

Earth Day – Then and Now

Gaylord Nelson, Democratic Senator from Wisconsin, originated the first Earth Day in 1970. (Also born in 1970 was Paul Ryan, an Ayn Rand acolyte elected to Congress by Wisconsin voters in 1998.) Nelson wanted a “national teach-in on the environment.” Pete McCloskey, a Republican Congressman, from California, served as Nelson’s co-chair. What are the chances today of a Democrat and a Republican coming together on environmental issues?

Twenty-million Americans demonstrated on April 22, 1970, sending a message that it was time to address the deterioration of the air, the water and the land. Later that year, President Richard Nixon issued an executive order creating the Environmental Protection Agency. Congress soon after ratified the order. Nixon – yes, that Richard Nixon – also signed the Clean Air Act, the Safe Drinking Water Act and the Endangered Species Act.

Forty-seven years later, flanked by coal-company executives, coal miners and the vice-president, along with various administration flunkies, Donald Trump signed an executive order rescinding his predecessor’s “Clean Power Plan.” Just to rub the EPA’s nose in it, the president held the signing ceremony inside the agency’s offices. He finished by telling the deluded coal miners, “C’mon, fellas. You know what this is? You know what this says? You’re going back to work.” According to the Associated Press, renewable-energy jobs already outnumber coal jobs, and many renewable-energy technologies are on their way to being cheaper than coal.

Obama’s executive order was a plan to reduce carbon emissions. Trump’s EO lifts a moratorium on new coal mining leases on federal land and relaxes limits on new coal power plant construction.

I wonder what our children and grandchildren will think about this.

…and in other news…

In a lawsuit filed against Palm Beach County, Trump demanded $100 million damages, alleging that emissions from the jets flying overhead are “causing substantial destruction of the materials” used to build the club, which include unique and historical items like “porous Dorian stone, antique Spanish tiles and antique Cuban roof tiles.”

And if that wasn’t bad enough, the suit claims noise and fumes from the air traffic have “substantially deprived” Trump and the club’s members the ability to use the property’s outdoor areas and amenities.

Records… What Are Records?

Vinyl records are having a resurgence. Enough people remember what music sounded like before the current era of sterile downloaded digital recordings reproduced through crappy ear buds. Vinyl discs required careful handling, touching only the edges, to avoid scratching the playing surface. When the needle dropped into the groove, pops and skips and scratchy sounds showed the futility of the effort. In spite of that, serious audiophiles spend thousands of dollars on turntables and tube-powered amplifiers.

And record stores are still in business. Some people still purchase compact discs and brand-new twelve-inch vinyl record albums. (No doubt including oldsters who have a much easier time trying to read the notes and deciphering the graphics on the larger album sleeves.) Some artists still record albums with thematic unity. Buying and selling used vinyl and CDs is a thriving business.

Tower Records is gone, but independent record stores are still in business. April 22 is their day. (It’s also Earth Day.) Go visit your local business where they care about the music.

My favorite: Last Record Store in Santa Rosa, California.

What To Drink on 420 Day

Heineken presumably knew what they were letting themselves in for when they put up a half-billion dollars last year to purchase half ownership of Lagunitas Brewing. Tony Magee founded the brewery in Petaluma California. Since then, most non-profit events in Sonoma County featured Lagunitas beer donated by Mr. Magee. The brewery also made headlines with the great marijuana bust of 2005. Lagunitas suffered through a twenty-day license suspension imposed by the state Alcohol Beverage Control Board. Unapologetic, the company periodically releases a seasonal brew labeled “Lagunitas Undercover Investigation on Shutdown or ‘Whatever, We’re Still Here’.” Still here… and there, too. Lagunitas has expanded to Azusa, Chicago, Charleston and Seattle.

So, of course Lagunitas is commemorating 420 day. According to legend, the day’s origins can be traced to high schoolers in San Rafael, just a few miles down Highway 101 in Marin County.

Lagunitas will celebrate – the operative word no doubt will be “celebrate” – twenty-five years of brewing in 2018.

The Oracle of Omaha

The Chairman of the Board of Berkshire Hathaway Inc. is perennially in the top three of the Forbes magazine list of wealthiest Americans. Warren Buffett’s letter to shareholders in the company’s annual report is must reading for many. The letter has become so popular that it is copyrighted and posted on Berkshire’s web site with access given to everyone. The first letter, written in 1978, discloses information about Blue Chip Stamps, one of Berkshires major holdings. The letters contain an aw-shucks overview of the company’s financial performance and explanations of how their major businesses work, including how to make money in the insurance business. They are filled with criticism of other corporate leaders and their outsized compensation packages, which in the end are not tied to actual financial results.

In his latest letter, as in most, Buffett, with his homespun style, offers his investment advice. Not flashy, but sound strategy for the long run.

“The bottom line: When trillions of dollars are managed by Wall Streeters charging high fees, it will usually be the managers who reap outsized profits, not the clients. Both large and small investors should stick with low-cost index funds.”

“Human behavior won’t change. Wealthy individuals, pension funds, endowments and the like will continue to feel they deserve something “extra” in investment advice. Those advisors who cleverly play to this expectation will get very rich.”

“Over the years, I’ve often been asked for investment advice, and in the process of answering I’ve learned a good deal about human behavior. My regular recommendation has been a low-cost S&P 500 index fund. To their credit, my friends who possess only modest means have usually followed my suggestion.”

The folksy letter finishes with summary of the upcoming shareholders meeting, a three-day bacchanal for the conservative investor. Nearly forty-thousand shareholders will travel to Omaha for the event.