The Passing of Peter F. Drucker

The FAIRBANK REPORT would like to pay its respects to the father of management science, Peter F. Drucker, who passed away on November 11, 2005 in Claremont, CA, at the age of 95. Like W. Edward Deming, Prof. Drucker was a giant in his field. His influence was particularly felt in the United States and the Pacific Rim. His legacy lives on among progressive and talented managers all over the world in all areas of business endeavor.

B G Phan, Senior Editor.

HIGHWAY TO HADES

By Jonathan Fairbank

Mr. J. Fairbank is Editor-in-Chief of the FAIRBANK REPORT.

The following are recently culled newspaper headlines about the Los Angeles Metropolitan area:

**The LA Metro has the largest number of murders and the second highest murder rate in the United States.

**The LA Metro has the most congested highways and freeways in the United States.

**The LA Metro has the worst air pollution in the United States.

**The LA Metro has the largest number of illegal aliens in the United States.

**The LA Metro has the largest number of illiterates and the highest rate of adult illiteracy in the United States.

Can Los Angeles be far from collapse?

Can the Fifth Republic Survive?

Eventually, the riots and fires in France will die out--in spite of police inaction. At some point in time, rioters will run out of cars to torch or will just become bored with the whole thing and stop.

The question now becomes, how long can the French Fifth Republic survive after the last ember has flickered out? Notwithstanding sentimental rhetoric, the Republic has failed miserably to mainstream its large number of Arab and African immigrants who have been socio-economically marginalized and physically corralled into densely populated suburban ghettos.

Institutional racism remains a major fact of life in ostensibly progressive and welcoming France. In fact, institutional racism is a Europe-wide phenomenon. Having lived in Europe for two years, I have seen the ugly face of institutional racism hidden behind the facade of enlightened rhetoric. Action speaks louder than words, and in Europe there has been very little action to match the rhetoric of ethnic and racial equality. As I had often noted to friends when I was living in Europe, the Continent, as a whole, was about 20 years behind the United States when it comes to race relations. Yet, ironically and basely, the European press gleefully snickers at Americans every time there's some racially motivated incident in the United States. And now that France is burning, the unpleasant truth has come out.

I am not gloating or am I excusing these reprehensible criminal acts that are currently taking place in France. The immigrant communities need to proactively assimilate to French customs and culture. After all, they are in France, in Europe now. Stop trying to replicate the institutions, customs and mores of the places from which you had fled!

Can Charles de Gaulle's Fifth Republic survive? Or will it take a new Sixth Republic to address the issues of racial equality, cultural assimilation and economic prosperity for all French citizens?

Good Bye and Good Riddance (?) to "the Maestro"

Good bye and perhaps good riddance to Federal Reserve Bank Chairman Alan Greenspan. He is scheduled to leave the Fed at the end of January 2006. Sycophants in government and the mass media have hailed him as "the maestro," "the genius" and other equally nauseating, honey-dripping terms of endearment. 

 Let's look at his recent records to see if these accolades are justified. In 1996, Greenspan correctly foresaw the "irrational exuberance" of an overheated, speculative stock market. Yet, he did nothing to cool down the market. A few interest rate hikes in 1997, 1998 and 1999 might have avoided the crash of the stock market from 2000-2003. 

In fact, Greespan probably exacerbated the 2000-2001 recession by belatedly and continuously raising rates after the March 2000 bubble had burst. It was only after the attacks of 9/11/2001 that the Fed began to cut interest rates. And then there's his recent "froth" in the real estate market commentary. 

Duh!, as the Valley Girl would say. Under his chairmanship, the Fed has failed to regulate the banks and other financial institutions, which have been pushing dangerous exotic loans, e.g., interest-only, piggy-back, 100%+-financing mortgage loans. In overheated housing markets such as California, Boston and New York, these creative financing schemes now account for the majority of outstanding loans! People who have no business buying houses are purchasing them at enormously inflated prices. After all, it's not their money; they're playing with OPM, other people's money. 

 The housing bubbles in California, Boston and New York will burst. And the consequences and ramifications will be ten folds worse than the bursting of the Nasdaq bubble. Yet, Dr. Greenspan, "the maestro"--nay "the genius"--has done very little to prevent excesses in the housing markets by reining in rogue lenders. Even if the Fed acts aggressively today, it is a day late and a dollar short. 

The upcoming housing bubble-induced recession, perhaps even a small depression, should be called Economic Hurricane Alan in honor of the maestro, and like other hurricanes, this one will pack a wallop and cause a world of hurt...

Joe Sixpack v Illegal Immigration

By William Barker-Finch

Mr. Barker-Finch is a free-lance writer based in Claremont, California.


When Poncho Villa and his gang of bandits crossed the sparsely populated Arizona and New Mexico border areas to raid on American towns and hamlets, President Woodrow Wilson sent in federal troops to defend American citizens and American sovereignty. Yesterday, we hear from the Border Patrol that the number of attacks against its agents by both the illegal aliens and their smugglers has skyrocketed over the last few years. Yet, we hear nothing from the Executive Mansion except that they would like to have a “guest-worker” program, which will undoubtedly spur on more illegal immigration and thus more attacks against our small cadre of border patrol agents.

The purposeful neglect of border enforcement has gone on for years through both Democratic and Republican presidential administrations. Amidst the constant bickering over Iraq and taxes, it appears that there is one common thread linking the two political parties: the support of an open border policy.

Democrats believe that more poor, uneducated, unsophisticated and diseased immigrants mean more Democratic voters in the future. In fact, Democrats don’t have to wait that long as there is ample evidence that illegal immigrants have voted in certain crucial local and national elections. Republicans, at the national level, represent the interests of big business—the big farm concerns, construction firms, food processing firms and other labor-intensive industries. These corporate fat cats want cheap and docile labor to boost their (already obscene) corporate profits.

At the same time, no party represents Joe Sixpack. He is burdened with high taxes to pay for the social services provided to illegal aliens. In fact, Joe has become the de facto benefits administrator-cum-payer for corporate America. Meanwhile, his middle class job is threatened with overseas outsourcing, and for those service jobs that cannot be easily outsourced, Joe is being undercut by unskilled, low-wage illegal immigrants. Joe’s schools have been so over-run with illegals that he has to put his kids in private school, which is another expense he can ill afford. His neighborhood, too, has been overtaken by illegals who live 19 to a room, which by the way is the allowable standard in the immigrant-dominant City of Santa Ana, California. And at 6 AM this morning just as he is about to put in another 12-hour day, Joe is rear-ended by an illegal who has no license and of course no automobile insurance. Another $500 out of Joe’s pocket for the deductible.

But there is a quiet and growing movement afoot to help out Joe Sixpack. In the wee hours of the night, patriotic radio hosts and Internet bloggers on sites like this are engaging in a revolution to reclaim the American government by educating the public about this problematic issue. The open-border Dems and Reps currently in power won’t know what hit them. They will still be talking about driver’s license and welfare for illegal immigrants when they are finally thrown out from Joe’s House of Representatives and Joe’s Senate.

Patience, Joe. Patience. Help is on the way…