You cannot have missed that this week the entire Internet decried, cyber-lobbied, and eventually prevailed in cowing Susan G Komen for the Cure¹ for its apparently politically motivated move to cut funding for Planned Parenthood.  If you did miss it, no doubt you did so because you were too busy reading about the unprecedented about-face performed by legislators after the Internet decried, cyber-lobbied, and eventually prevailed in cowing Congress into (temporarily, at least) shelving SOPA and its equally evil doppelganger, PIPA.  Two weeks of cyberactivism have brought two remarkable reversals, at least one of which comes from a 535-strong body not exactly acclaimed  for its responsiveness to public opinion (ahem, House of Representatives).  All of which makes the social media-fueled Arab Spring look like last year’s news (which, of course, it is).

Call it Cyberactivism.  Or Internet Lobbying.  Or Social Media-fueled Activism.  Or, simply, what it is: a tech-enabled mechanism for people to express their opinions and, more importantly, organize.  The politician, the public official, the household brand, and—yea verily—anyone whose profile is sufficiently lofty to merit public scrutiny appears now to be confronting the stark reality that this medium has teeth.  It’s bidirectional.  It is not, with apologies to Mr. Sullivan, a potted plant.

Which brings me back to my late ’70s foray into the 21st century body politic.  Future Cities’ British and unabashedly futurist authors, Kenneth William Gatland and David Jefferis, predicted a wristwatch-like device called a risto (read: iPhone) from which instant, bidirectional communication was possible anywhere, any time.  Foreshadowing Job’s iPhone keynote by a mere three decades, risto wearers could “talk to anyone, wherever [they] happened to be.”  A risto would “sell for about the same price as a pocket calculator [2-year AT&T contract notwithstanding nor anticipated] and weigh no more than a few grammes.”  But here’s the kicker, for which I feel compelled to provide a the actual figure from page 12:

image courtesy of Matt Novak, Paleofuture

Without thinking so explicitly, for more than 30 years, I’ve waited to see a world in which the public discourse grew to be informed by instant communication and distributed opinion.  This January, I believe I’ve caught my first glimpse.  Brave New World of instantaneous, unfiltered opinion.   Surely, this New World is rife with potential for imprudence:  tyranny of the majority, wide-scale misperceptions, fickleness of popularity, madness of crowds.  But the world is messy, and always has been.

For the moment, I find myself marveling in the prescience of Mssrs. Gatland and Jefferis.  They predicted that a 21st century world would bring with it immediacy (if not transparency) of opinion.  Representative Smith and Senator Leahy, beware.  Your peril was predicted in 1979.

A note on the research:  I was tempted to expand this post to wax rhapsodic about how one can find anything using Google these days, but I didn’t want to dilute the message.  Nonetheless, I feel compelled to pass along one other part of the story:  Just two hours ago, I got the idea for this post but, as you might imagine, had neither the book from my five-year-old bedroom nor a recollection of either the title or author.  But a little Googling for “1970s children books about the future” and then ” \”instant voting\” ” took me to Matt Novak‘s awesome Paleofuture blog, a couple of posts about Gatland and Jefferis’s book, and, to my utter amazement, a scan of the prescient page 12—which, it thus appears, I am not the only one to think was remarkably foresighted.  Two hours later, you have this post.  For better or worse.

1. a well-labeled, message-in-the-name, 501(c)(3) which, save for this week’s misstep, generally has my support

¹

Dinner time brought a conversation between two well-educated women who jointly have two children under the age of two, two MBAs from Harvard Business School (three if you count their spouses), and serious fashion sense. One works for a well-known and recently-public Silicon Valley company; the other is an entrepreneur and former Wall Street investment banker. Among myriad other dinnertime topics was CodeAcademy. They’re both using that particular hot site to get up-to-speed in web development. One of them signed up for CodeYear. The other was talking just this afternoon with yet a third thirty-something woman entrepreneur and Ivy League b-school grad about—you guessed it—CodeAcademy.

Whence comes this new found interest in coding? Do we credit some mass hysteria embodied in the form of people who simply must engage in NP-completeness proofs? Fortunately, not. It comes from a profound reordering of today’s business world. “Coding is the new literacy,” says Zach Sims of CodeAcademy. Just as the well-educated of the 19th century read both Latin and Greek before learning “The Algebra,” so a 21st century entrepreneur must be able–at the very least–to understand the underpinnings of her own website.² And thus to direct the next step. And the next innovation. Will they develop the next algorithm for the solving of General Lattice Puzzles? Perhaps not. But will they understand all they need to understand in order to innovate in the dynamic, real-time environment which is twenty-first century innovation? Surely. Are they equally likely to avoid being snowed by their coders as their counterparts two decades ago were when presented by a “complex spreadsheet” model? Equally surely.

All of which puts those of us who think of themselves as lifetime coders—and therefore perhaps smugly considered themselves possessed of rare skills—on notice. Calculators and spreadsheets have ceded the field to Javascript (errr, ECMAScript) and MySQL (or various NoSQLs, if you’re really cool). Requisite knowledge now encompasses what, even a few years ago, was considered the domain of the “geeks.” Which means that I, for one, have a lot of skills development to do….

1. Coders will note that my “code” on the left is, in fact, merely markup—of this post, in fact. True. But it gave me a chance plug the absolutely gorgeous syntax highlighting of my new favorite text editor, Sublime Text. Quite possibly the most beautiful text editor I’ve ever used. Consider the tip a peace offering for conflating markup and coding.
2. The perspicacious and francophone reader will note that the correct word is ‘entrepreneuse,” but I refuse.

Friday nights are reserved for family pizza night.  Although no startup exec is too surprised when business intrudes on a family ritual, none of us could have expected the matter of emergency services response times would come crashing—quite literally—into our Friday night.

…Interruptus

At 8:46pm last night¹, we heard a horrible-sounding car crash right outside our house.  At my day job (more about it in a minute), we work with police and emergency services every day, and so not one but two thoughts immediately flashed through my head:  1) thank God my family is safe; and 2) I know what to do now:  call 9-1-1; they don’t know about this yet; give them as much information as possible.  (Fortunately, I had already done the most important thing:  made sure my address was visible from the street as soon as we moved in.)  And so began my personal saga of trying to get useful information to someone who could help—and learning, at a personal level, why what we do every day at ShotSpotter matters:

False Start: 20:46:10?-20:48:35 (seconds 0000-0125)

Within 60 seconds, I find  our home phone and dial 9-1-1.  It’s a Vonage line, and I am unpleasantly surprised to be connected to San Francisco 9-1-1.  We live in San Mateo County, and I quickly realize that I must have neglected to update the 9-1-1 street address information for the account.  (Yes, Vonage doesn’t know where to send your 9-1-1 call unless you tell them.  Not their fault;  this is why Next Generation 9-1-1 is so important.)  Now I have to spend 55 seconds convincing the operator that there was an emergency, but I am in another county from her, that I had been mistakenly connected to her, and therefore that she shouldn’t do what 9-1-1 protocol calls for her to do if I just hang up:  1) call me back if I hang up and escalate the call as non-responsive, or 2) worse yet, send help to our old address in San Francisco, where we don’t live any longer.  Mission accomplished, but 125 seconds wasted.

How May I Direct Your Call? 20:49:00-20:51:30 (seconds 0170-0320)

So now I’ve got to find another way to call.  Option #1: call local emergency number posted on refrigerator.  (You do have your local police switchboard on your refrigerator, right?)  Too far.  I’m upstairs, time counts.  Option #2: use my mobile phone.  Fortunately, thanks to E9-1-1, calls from mobile phones usually go to the correct local PSAP (that’s Public Safety Answering Point), not to the California Highway Patrol, as they used to.  I’m connected and immediately confronted with a question:  ”What is the nature of your emergency?  Police, Fire or Medical?”  Hmmmm, car crash.  I’m thinking Medical.  But most fire departments deliver EMT services these days.  So is it Fire?  Eventually the Police will have to show up.  I wonder if it’s Police?  No, it’s Medical.  ”Medical,” I say.  ”OK, just a minute, sir.”  I’m on hold for what feels like hours, but is really about 45 seconds.

Critical Information: 20:51:30-20:54:12 (seconds 0170-0482)

“Please state the nature of your emergency.”  ”There’s been a car crash,” I reply.”  ”OK, are you hurt?”  ”No, it happened outside my house.  I’m trying to help.” “What is your address?  [I answer.]  OK, help is on the way, and I need to ask you some additional questions.”  I check the time at this very moment:  324 seconds havepassed—5 minutes, 24 seconds.  That’s how long it took me to get the word to people who could help that somebody needed help.  And I was clear-thinking and organized, because I wasn’t involved.  Maybe I knew a bit more of what to say because I work in the field.  Maybe.  If I had been a victim, adrenalin racing through my system and clouding my judgment, trying to figure out where I was, what precise address I had stopped at (or what road I was on, for that matter!)—who knows how much longer it would have been?

Keep Gathering Information: 20:54:13-20:59:17 (seconds 0483-0787)

Can you see anybody?”  ”Not yet, I’ve got to get a flashlight.”  And so ensued another 6 minutes of the 9-1-1 operator talking to me, instructing the victims through me, and getting information he needed.  Was anyone trapped in the car? (No.)  Was anyone ejected from the vehicle?  (No.)  Was anyone bleeding? (Yes.)  Were the victims young?  (Yes, under 18 and trying to get me not to call the police)  Was there obvious alcohol? (No.)

21:00 Help Arrives (seconds 0788+)

The cavalry arrives.  Two fire trucks and the Central County Fire chief, police, ambulance.  The neighbors disperse back to their homes to bring their families up to speed on what happened.  The professionals take over.  The kids are taken to local hospitals.  The car is removed.   Someone sweeps up the debris.  Nighttime quiet returns.

11 Minutes Matter

Which brings me to response times.  The Burlingame and San Mateo County emergency responders did their jobs perfectly:  they arrived quickly (roughly 6 minutes from my giving the address;  maybe 8 minutes if one of my neighbors had also called and not had my Vonage-related false start), to the correct location, and rendered aid.  But through no fault of their own, first responders were completely dependent on me and my neighbors to get them to the right place.  We live in a quiet neighborhood where such incidents are uncommon.  When they do happen, we all call.

My Day Job

Whereas accidents can (and do) happen anywhere, others live in neighborhoods where, sadly, violent crimes also put lives at risk—and do so every day.  At ShotSpotter, we deal with one particular kind of violent crime:  gun violence.  Literally every evening, our systems detect between a hundred or more shootings nationwide.  And therefore a hundred or more times a night, ShotSpotter delivers information similar to what it took me 5 minutes and 24 seconds to deliver over the phone automatically to police—about 150 times faster than I was able to.  Unfortunately, if you live in a neighborhood where you hear gunshots every night, you’re also not as likely to call the police every time as if you hear it once a year.  ”It happens every night; the police already know!” That’s why studies show 9-1-1 receives a call less than 25% of the time a gun is fired.  And as you can see from my experience last night why, even when they do receive a call, 9-1-1 finds out anywhere from 3 to 8 minutes after the event.  (And bear in mind that in the 25% of cases in which people do call 9-1-1 about gunfire, they don’t know where the gunfire took place; they know where they live!  So that adds time to the response too, as police don’t know precisely where to go.)

When lives are at stake, seconds matter.  (See USA Today’s “The price of just a few seconds lost: People die”, for example)

So I’ll go to work on Tuesday knowing that our product helps make communities safer, if not from an unfortunate car crash which thankfully caused no serious injuries,  then from the hundreds of gunfire incidents we help pinpoint for police so they can arrive to exactly the right place, minutes earlier than they otherwise could, hopefully in time to save a life, perhaps take a gun off the street, and in time to send a message to the community that while car accidents may happen, gun violence doesn’t have to.

1. I have accurate elapsed times in this post for everything thanks to the phone logs on my mobile and Vonage phones, except for the first 30-45 seconds which it took me to go from our family room to pick up the phone

The reaction within the Kingdom was remarkable for its simultaneous restraint and schadenfreude fascination.  The Saudi Times, the Kingdom’s English language daily and a publication best known for its heavily state-influenced reporting, could not avoid featuring Egypt as its front page, column 1, above the fold news, day after day.  They struggled to find sufficiently noncommittal statements from His Highness King Abdullah, who appropriately spoke strongly in support of the Egyptian people, but stopped short of supporting an overt removal of Mubarak.

The next day, I met with a business partner for lunch and found myself in a candid conversation with a scrupulously gracious and recent Egyptian expat, roughly my contemporary, who in his candid thoughts found himself profoundly worried about events back home. At first I thought his duty to provide Arab hospitality to his visitor perhaps extended to accommodating what he knew to be the view of the US Government: namely that Mubarak, virtual dictator though he was, was relatively preferable to a destabilized and potentially radicalized Egypt. But even Arab hospitality has its philosophical limits, and my colleague showed all the signs of real conviction:  the specter of a state run by the Muslim Brotherhood, overtly hostile to the West, to the minority Egyptian Christian population, and leaning towards extremist isolationism was enough to make my friend lose his appetite.  He began smoking constantly, until his mother called.  From Egypt.  To tell him she was alright.  And then he calmed down a bit–at least for a while.  But he kept smoking.

Now that I’ve left the Kingdom, I can say that the reports on Western news media that “Saudi might be next” or that the unrest in Jordan is but a harbinger of a complete democratization of the region are at once both hopelessly optimistic (speaking of the region as a whole) and naively ignorant of the facts (speaking of the Kingdom in particular).  The Saudi monarchy bears little resemblance to the Mubarak regime: it has developed a broad-based and effective system of wealth distribution that keeps it firmly both in power and on the friendly side of what otherwise become the restless middle class bourgeousie.  It has also struck a 30-year deal with its Wahabbi extremist constituency which keeps it both in power and cloaked in the vestments of religious authority.¹  They have effectively managed diverse constituencies and, even if we know that the average Saudi is restive and possibly susceptible to persuasion by extremists to become terrorists, at the same time the monarchy has paid attention to constituencies and dynamics which Mubarek et al. chose to ignore.  For that reason alone they may receive some flak for infrastructure failures (the virtually annual Jeddah flooding and the virtually annual street protests come to mind), but they remain firmly in power and respected.  And US media theorizing notwithstanding, they show every sign of staying that way for the foreseeable future.

At the same time, Americans and others who see the recent Egypt developments as “a miracle” ought to bear in mind that this triumph of democracy has brought with it an 80 million person power vacuum.  If the Muslim Brotherhood has its way, peace treaties with Israel disappear, the Christian minority becomes a persecuted apostatic underclass, and Egypt flirts with the fate of Afghanistan after the Soviets.  We can–and should–celebrate the removal of a brutal autocrat.  But we should also brace ourselves for a messy destabilization.  If my Egyptian friend is right, most of his 80 million fellow countrymen want I peaceful, nonradical state.  On behalf of one peripatetic and worried American, I profoundly hope he and they get what they want.

1. The relationship between the House of Saud and the Wahabbis in fact stretches back nearly 300 years, but it was the Kingdom’s need for a fatwah “authorizing” their counter-attack on the dissidents who took over the Grand Mosque in 1979 which rolled back the modicum of liberalization seen in the Kingdom during the ’70s and cemented their symbiosis for decades to come.

Last year, I traveled Pakistan to speak at a counter-terrorism conference.  I met numerous devout, serious Muslims who decried the senseless violence extremists have brought to their country.  Little did I think that, just a year later, I would be comparing those well-meaning, peaceful Pakistanis with the peaceful, shocked residents of Arizona.  But here we are, a modern first world democracy, confronting the fact that our own internal extremists brook no more dissent than do Pakistan’s and feel no more compunction at shedding the blood of leaders with whom they disagree than do the likes of Mumtaz Qadri (Taseer’s murderer and bodyguard).  In Pakistan, extremists murdered Benazir Bhutto for her  non-extremist beliefs;  in the United States, extremists murdered  Dr. George Tiller for practicing abortion.  Pakistani extremists defy the Koran when they take the lives of other Muslims whose beliefs they do not agree;  American extremists defy their (mostly Christian) beliefs when they take the lives of those whose beliefs they don’t like.

Now we find out that the alleged perpetrator in Arizona is mentally ill.  Does that exonerate him?  Make him any less an extremist?  The vast majority of schizophrenics lead non-violent, if unenviable lives.  Few of them create YouTube channels devoted to anti-government rantings.  So I brand him extreme.  When will we—Americans and Pakistanis alike—act collectively against the overt hostility of our public debate, before it roils itself into outright murder?  We live today in a democracy transmogrified into a killing field, in which those with whom we disagree politically are not only not worthy of our respect, but not worthy of their own lives.  It is already too late to save the first victims.  Will Americans wait until political killing is reaches the heights it has reached in Venezuela, or Pakistan, or Myanmar?

I have spent much of my professional career fighting to end one type of violence: gun violence.  Every day, my work at ShotSpotter helps save lives, solve gun-related crimes, and take criminals off the street who would otherwise keep using guns to destroy lives and communities.  A few years ago, I was fortunate enough to be asked to join the Board of Directors of PAX, our country’s leading non-profit dedicated to reducing youth gun violence.  I thought I was making a difference.  And then I wake up on a day like today, and I read the news from Islamabad, and the news from Tucson, and I realize just how much more difference there is to be made, and how much work we all have before us.

There was something surreal about watching President Obama take the oath of office from a hotel room in Karachi, Pakistan. Several times, I wondered whether there were more suicide bomb barriers surrounding his dais or my hotel. Suicide bombers had nearly destroyed the hotel a year or two earlier, and the predictable reaction—to erect sufficient vehicle barriers to stop more than one simultaneous attack—had of course been implemented. And so I watched, from 13,000 miles away, as America took what I profoundly hope will be the first of many steps towards reestablishing its international reputation as a symbol of freedom, all the while knowing that I was under strict orders from our hosts not to leave the building.

All around me were little security instruction sheets, thoughtfully Xeroxed by the hotel staff and placed in every room. From the typical (“this water is unsafe for drinking; kindly enjoy the complimentary bottle of mineral water provided”) to the stern (“do not stand on balcony; snipers may be active”), the warnings combined to deliver the message that, thanks to the efforts of less than 1% of the population, Westerners are simply not welcome in Pakistan. 99% of Pakistanis we met were hopeful, interesting people, happy to talk to an American (and to ask us about our new president—more about that in a different post). But all I had to do was look out my hotel room window to realize that it is the 1% who rule the country.

View from my Karachi Hotelroom

As they so often do, this picture tells the story better than I can. The balcony is enclosed in a net, lest grenades be thrown up onto the landing. The wires above the pool are for god-knows-what security technique. (My guess: since they are either grounded or energized, probably an anti-eavesdropping measure which doubles as a mechanism for defeating radio frequency bomb triggers, although my mobile phone worked just fine underneath them, so perhaps not.) There were magnetometers, x-ray machines in the lobby, and nearly every entrance to every building was peopled by thoroughly un-reasuring armed guards. There were small trucks parked in the parking lots of both “Western” hotels, each filled with four chain-smoking Pakistani infantrymen, on top of which was mounted what looked like an M60 (.50 caliber machine gun). Two bomb-sniffing Labrador retrievers worked the parking lot. ID checks were performed endlessly.

I doubt that any experience since 9/11 has reminded me that this really is a war. Not a war which gives our government the right to abrogate our Constitution, but a war nonetheless. And until it ends, Americans traveling abroad had better remember that the actions of our own government (and in particular the recently-departed administration) catalyze reactions abroad which pose as grave a threat to our well-being as any other. (Until 2002, there had been no attacks against Western targets in Karachi. That all started after we reacted to 9/11.) In the end, no matter how hopeful I am that the inauguration of President Obama will set us off to righting our standing worldwide, we will remain “the enemy” for a long time to come.

source¹

To listen to Robert Nardelli (Chrysler, formerly CEO of Home Depot), his company has minutes remaining.  I’ve certainly expressed a sense of urgency before in my job when working to close a deal, but it’s impossible to listen to him and not sense something profound.  Three of our great industrial giants are willing to speak publicly about endgame.  Rick Wagoner (GM) seriously discussed a “pre-packed” Chapter 7 bankruptcy (surely a trial balloon alternative if ever I’ve heard one) by quoting marketing studies which show consumers are overwhelmingly unwilling to buy a car from a bankrupt company.  When was the last time you heard the CEO of a major non-financial company speaking about such potential downsides alongside his competitors? Extraordinary times indeed.

But not extraordinary enough.

Towards the tail end, Alan Mullaley (Ford, formerly Boeing) was asked whether his company would exceed the new CAFE fuel economy standards.  His response?  That Ford would barely be able to make them, and would not be able to exceed them.  The others agreed with him.  That one response convinced me that any bailout of US automobile manufacturers should 1) be totally focused on saving jobs (millions of them, potentially), and 2) must be so severely punitive of the companies themselves that they don’t get out of jail free.  These three companies have succeeded in lobbying their way out of innovation legislation (fuel economy, safety, public transport, etc.) for decades.  Consumers have responded by choosing foreign manufacturers preferentially (e.g. Toyota who pushed hybrid technology as a differentiator).  US manufacturers drop to the bottom of the list of consumer choices because of the manufacturers’ complacency, and then a contraction comes along and endangers the bottom of the barrel.  Surprise, GM, Ford, Chrysler, you now inhabit the bottom of the barrel precisely because of your complacency!

A little capitalist Darwinism is in order here.  If these guys had worked on fuel economy and alternative technologies 20 years ago, CAFE standards would be unnecessary now.  For want of those prior investments, it is not the Government’s job to subsidize their lack of business skills.  Do what we need to to save the jobs (lest we further endanger the economy), but otherwise I vote let these companies suffer the fate of others who stick their heads in the sand.

1. Businessweek online, “Auto Execs in the Hot Seat” http://www.businessweek.com/bwdaily/dnflash/content/nov2008/db20081118_113319.htm?chan=rss_topStories_ssi_5

Not so.  Enter Sequoia Capital’s “RIP Good Times” presentation.  Within a day, eight people had forwarded it to me, along with notes taken by a briefly-anonymous Sequoia portfolio CEO.  Shortly thereafter came the Benchmark Letter, which another investor and our corporate counsel both forwarded to me.  And the Ron Conway email.  The argument is that revenues and earnings will fall off the table (thus perhaps justifying the fact that today’s S&P 500 is trading at a pretty low average P/E of 10.5), thus necessitating tectonic readjustments to spending.

And there it was: in one great, coordinated movement, Silicon Valley panicked.  It was as if the Valley remembered 2000-2001 and couldn’t sleep.  A friend of mine, at a Seqoia company, worked the weekend and executed a 40% layoff earlier this week.  Hi5 cut staff, Zillow and Adbrite did the same, and the list goes on and on.  One day everything is fine;  the next, the world is ending.  Trader mentality hit Sand Hill Road.  With the zeal of the converted, a paroxysm of cost-cutting swept Valley CEOs.

This “stampede for the exits” mentality of supposedly long-term investors here in the Valley makes zero sense.  One of my Directors correctly pointed out that Moritz et al. at Sequoia were undoubtedly “firing for effect,” and I’m sure they were, but tell that to the employees laid off by my friend’s Sequoia-backed company.  The problem with making rapid adjustments to early stage companies is that the adjustments themselves effect the business.  There’s a Heisenberg Uncertainty Principle in startups:  trimming too fast or too precipitously will injure the company far more deeply than it would a larger, established company.  Why?  Because start-ups in particular rely on their employees to go the extra mile, think the impossible is possible, burn the midnight oil, and invent the ingenious.  They also rely on their employees knowing they’re involved in something special, relishing their creative environment, and collaborating with their colleagues.  (For which, of course, they need to have colleagues…!) Take all that away, and a start-up is just a thinly-staffed, under-capitalized company with no track record or proven market.

There’s another, more profound risk, however:  react too strongly and Heisenberg will assure your startup misses the market opportunity it’s not expecting.  The problem with over-optimizing, particularly in venture-backed companies, is that they will miss the unexpected, creative opportunity, either because they are so busy dealing with the ramifications of precipitous cost-cutting or because they will be so under-staffed and so hyper-focused on cash flow that they will have neither the energy nor the creative spirit to do something daring when the opportunity presents itself.

Does this mean we should be spending profligately and ignoring the broader dynamics of the economy?  Of course not.  No CEO in his or her right mind would do so.  But the fact remains that what makes Silicon Valley great is certainly not its ability to play the part of proverbial “tail” to the economic dog which wags it.  Every one of us should take a careful look at our spending, our sales forecasts, and make sensible business decisions based on what we see.  (In our case, we see changes coming and are adjusting for them.  We’re cutting where we need to, investing where we can afford to, and otherwise treating the shake-up as an opportunity to test every single one of our assumptions.  And, yes, if one of those assumptions changes and we see a problem, then we’re going to cut spending.)  But lay off 40% of staff just because someone gave a presentation?

Fortunately, voices of sanity have begun to speak up.  My friend and colleague Pascal Levensohn (full disclosure: also now an investor and Board member in my company) wrote an excellent post today putting context around the Sequoia presentation.  And none other than the Sage of Omaha himself is going long on US equities.  All of us running businesses under these economic circumstances are well-served to create a back-up plan (the “survival plan”), take a whack at expenses wherever and whenever possible (hey, shouldn’t we be doing that all the time anyway?), test every single assumption in our models, and perhaps think long and hard before hiring additional staff.  But then we should go back to work, build amazing businesses, and remember that Silicon Valley is about the future and we’re in charge of creating it.

What would society be willing to pay to eliminate this $3.1 billion a year medical cost?  It turns out that two of the authors of that JAMA article tried to estimate it in a previous article in the Harvard Health Policy Review, which I wasn’t aware of when I made my previous posting.  According to their article, Duke professor Peter J. Cook and University of Chicago Professor Jens Ludwig believe the number was perhaps as high as $100 billion in 1998 (or $125 billion in my back-of-the-envelope estimate of 2008 dollars).² Here’s there logic:  in a 1998 study conducted by the National Opinion Research Center, the thousand US households surveyed were, on average, willing to spend an additional $239 dollars each to reduce gun violence by 30% in their state.  Do a little math using 2008 dollars³ and 2008 households⁴ and get:

$34 billion.  How do we get to $120 billion?  The above calculation reflects what the US households would be individually willing to pay to reduce gun violence by 30%.  Assuming a linear increase in willingness to pay to reduce by 100%, the Cook and Ludwig suggest the tab looks like this:

(In fairness, I have some concerns about this extrapolation.  Saying I am willing to spend $239—or $303 in today’s dollars—to reduce gun violence by 30% does not necessarily mean I’m willing to spend $1,010 to eliminate it completely.  And certainly, as the authors point out, there may be some real costs to eliminating gun violence by 100% that a linear extrapolation will not account for, even if I were willing to pay for it.  Nevertheless, if the precise figure is wrong, surely the scale is not.)

Add to this $113 billion the roughly $10-20 billion annually in costs attendant to suicides and gun-related accidents and you land somewhere between $123 billion and $133 billion—call it $125 billion in nice round figures.  That’s a big number no matter how you look at it:  it roughly equals the combined annual budgets for the US Department of Health and Human Services and the US Department of Education, or somewhat more surprisingly, the combined annual budgets of the US Department of Homeland Security, Department of Energy, Department of Justice, Department of Agriculture, Department of Transportation, and NASA.⁵  (By the way, think this is an abstract comparison?  Perhaps, but remember:  we pay for all of these government agencies, so we already perceive their value, just as we perceive a value in reducing gun violence.)

If all this talk of big numbers is giving you a headache, the good news is there are simpler and more cost-effective solutions than seeking the American peoples’ collective budgetary allocation for half again as many federal agencies as they’re already funding.  Take a look at simple and effective programs like Speak Up! and Ask!, both run by my friends at PAX, which seek to eliminate school gun violence by encouraging kids to speak up if they know of something which might happen (in the case of Speak Up!) and encourage parents to ask if the houses at which their children are playing contain guns (in the case of Ask!).  These are fabulously cost-effective programs, and their results (here and here) are speak for themselves.

1. Philip J. Cook; Bruce A. Lawrence; Jens Ludwig; Ted R. Miller The Medical Costs of Gunshot Injuries in the United States JAMA. 1999;282(5):447-454.
2. Philip J. Cook; Jens Ludwig; The Costs and Benefits of Reducing Gun Violence Harvard Health Policy Review. 2001; Vol 2, No. 2.
3. http://www.westegg.com/inflation/infl.cgi
4. Day, Jennifer Cheeseman, Projections of the Number of Households and Families in the United States: 1995 to 2010, U.S. Bureau of the Census, Current Population Reports, P25-1129, U.S. Government Printing Office, Washington, DC, 1996
5. http://en.wikipedia.org/wiki/United_States_federal_budget

Buried within the “Primary Sources” section of next month’s The Atlantic is a section appropriately headed “Seriously Funny,” recounting a report from the Project for Excellence in Journalism at journalism.com.  The journalism.com report summarizes a number of studies by the Pew Research Center for the People and the Press, one of which offers the following surprising comparative current events knowledge scores:

source²

Your eyes are not deceiving you:  The Daily Show and Colbert Report’s viewers actually scored higher on this particular test than did NPR listeners. (Note:  I want a margin of error on this measurement, and the Pew study doesn’t identify one, so it’s hard to tell how meaningful this 3% difference is.)  But there is no question that the data corroborate the earlier Knowledge Networks study:  Fox News Channel yet again brings up the rear.

Pew goes a little further than the Knowledge Networks study and conveys some of the audience demographics.  Of particular interest, for example, is the fact that NPR listeners are more likely to have graduated college than regular consumers of any other news media other than major newspapers’ websites, and that yet again Fox News Channel lags behind:

source3

There are some surprising numbers in these demographics, too:  The Daily Show’s viewers may know marginally more about current events than listeners to NPR, but they are substantially less likely to have graduated college (only about 75% as likely).  Equally surprising is that the Daily Show’s demographic is slightly less likely to be young than regular readers of major newspaper websites or Google/Yahoo! news.  In other words, if you’re aged 18-29, you’re most likely to get your news online.

Or, to put it another way, if you’re over 29, why are you reading this? 

1. Michel was then CTO of Knowledge Networks and his colleague Stefan Subias, conducted by PIPA (the Program on International Policy Attitudes) and published in Political Science Quarterly
2. The Pew Research Center for the People and the Press, Public Knowledge of Current Affairs Little Changed by News and Information Revolutions
3. The Pew Research Center for the People and the Press, Public Knowledge of Current Affairs Little Changed by News and Information Revolutions