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Saturday, 6 March 2010

Up Close and Personal with Richard D. Brynteson

NEARLY every morning, a tall caucasian makes his way to the neighbourhood Hailam Kopitiam, located somewhere off Old Klang Road, Kuala Lumpur. The cafe has become the haunt of the Concordia University’s professor from the College of Business and Organisational Leadership Richard D Brynteson over the past month.

On mornings that he does not turn up, it gets the Myanmar staff wondering about his absence.

Brynteson goes there to write and reflect. It is a time of renewal and assessment as he savours the scene before him and compares life here with another back home; where eight lakes are just a five-minute drive from home and he can just throw his kayak atop the car to get some fun.

So while his body is in that kopitiam, his mind and spirit is far away in another world, in another time.
Brynteson is from Minnesota, USA but he’s lived in different parts of the world doing different things other than teaching.

Occasionally, he engages in conversation with the staff from Myanmar. Divided by a deep chasm, he is a professor and they, waiters from another foreign land, they have somehow come together, drawn to each other because of their comradeship as foreigners in a country not their own, learning about life in a strange land.

“Coming here has taken me out of my comfort zone. People here do things differently. It jars me and makes me look at life and things differently,” he says.



Brynteson is here on a six-month sabbatical. While he is here, he aspires to do a number of things. He is writing a book on innovation; he has published two on other subjects and has a series of published works.
Brynteson is a man of many talents and interests. Maybe that is why he feels so pulled in different directions. There are many things he would like to do – being a war correspondent is one of them – but like most of us, he is limited by human frailties.

Before coming here, there were several options he had considered. One of them was to save the children in Haiti immediately after the earthquake. His brother-in-law is there, helping out.

“I told myself, they need people who are doctors. I have no practical skills but paint with water colours and make Christmas cards. I don’t have a skill to help out. I can’t build orphanages or houses, although I have washed dishes in four continents.”

He pauses a few seconds. “I’d like to be a war correspondent, but I don’t think that is going to happen.”
There are so many things he would like to do, yet he is cautious, to the point of being self-deprecatory despite his many achievements.

“I am not a risk-taker,” he says simply. That is ironic because as one goes through his resume, he seems to have taken a great many risks in his 54 years – his published works, workshops, seminars and presentations run into several pages, likewise the training he has had and the consultancy work he has done.

Although Brynteson’s background is in marketing, he has moved on to various subjects. He taught advertising, human relations, management, and organisational behaviour.

He is now lecturing on creativity and innovation. How he goes about doing that is baffling but while he is here in Kuala Lumpur, a consultancy has lined him up to do an interactive one-day workshop on Innovation for Managers and Team Leaders: The Manager’s Innovation Toolkit.

“You teach creativity and innovation by asking questions.”

There were times when he told his students to list down 25 questions about a pram, or an orchid. They are not going to leave the classroom until they do. The objective: to sharpen their creativity and questioning mind.
Brynteson does not seem to be aware of it but in many ways, he is more than a teacher. He is a leader and a motivator.

Yet, from the same man, came this statement: “The most important quality is self-awareness – how well do you know what you are good at, and what you are not.” And that is the single most ironic thing about this man. He is a leader in his own right and yet does not seem aware of it.

Loving life and people

Brynteson loves life and people. And it is this single factor that has taken him out of his comfort zone, time and again, to different parts of the world to work on different things. He’s worked on a kibbutz (a farming community where people live and work, sharing profits and decisions) in Israel.
He has been at one time an assistant manager in a coffee plantation in Guatemala, Latin America.
He has also worked with Wycliffe Bible Translators in Ecuador, South America and studied art history in Florence, Italy.

In short, he has done a myriad of things not connected to teaching, marketing or innovation. But all these experiences and encounters have made him a better teacher, leader and friend. And his enthusiasm for people and living comes across.

“I love teaching and working with students. I want to open up their minds to different possibilities. I cannot believe that at the end of the evening, from 5.30pm to 9.30pm, I am paid to do something I like.” Therein lies the enthusiasm and hope for his students and the people he encounters.

Brynteson holds a strong connection with his students. Until today, he is still in contact with students he taught high school history in 1980.

“I enjoy my students. Many of them love a challenge. They see a problem and ask themselves how they can solve it. They are tenacious and will not let go (of hope) of their goals.

“I like people who have a heart and mind and who cares more than just about how to make more money. I like people who grow and who are challenged. All of us go through different stages of life. At 40, we are different when we were 30. When they are in my classroom, I am there to take them part of the way.”

Brynteson says one of his students went from a secretary to become an executive vice-president; she is now retired and runs a quilt shop. Another went from a bank teller to vice-president of marketing.

“It gives me tremendous pleasure to see them grow and come up to their full potential.” While some of his students have risen up the corporate ladder, others made decisions which positively touched the lives of others because they believe in doing the right thing.

“One of them told me, ‘yes, Richard, I may have lost US$7mil, but I’m glad I did the right thing. I have built a community for senior citizens, where they can go to the doctors, the coffee shop, and the lawyers, all within a community.’ Another has built an office where you can jump from the second to the first floor to de-stress.

“All of us work very hard and there are times when we need to de-stress and have some fun. There is a minor league team in Minnesota. Their tickets are sold out game after game. There’s a pig that runs around the place. People enjoy going to the games. It’s not about winning or losing. People don’t care about that but they are there to have a great time. It is about entertainment.”

Creativity and Innovation

Brynteson’s interest in creativity and innovation came about as a result of the comments of people around him. He is pretty much a thinker, analysing situations and problems in order to find a solution. There was a time when he was in the chemistry industry and had to develop non-toxic oven cleaners.

From products, he went on to marketing and developing strategies for marketing. But at the root of all that interest him is the mind and the thinking process.

He takes the ordinary and mundane, and considers how the actions of today is going to impact the future.
In his book Once Upon A Complex Time, he writes: “System thinking is thinking with wide-angle lens, not telephoto lens. (It) is seeing the connections between parts, not just the parts themselves. (It) is seeing the patterns and structures underneath events, not just the events themselves, (It) is examining the time and distance between cause and effect. Systems thinking is circular, not linear, thinking. (It) is an excellent problem-solving tool.”

Let’s take systems thinking and consider how it has affected Brynteson himself. Because he’s been told often enough about his creative ideas, he went into lecturing the subject. He has learned from those around him that he is good in this.


“People keep telling me that I am creative. I kept coming up with new ideas for this and that. That was how I got into this creativity and innovation lectures. Creativity is being able to look at things and situations differently and innovation is applied creativity. Innovation is taking something and making it useful.

“We need to think innovatively. Most innovations are not coming from people who are brilliant but from collaboration between government agencies, corporations, think tanks, universities and foundations. It is not something that comes overnight but it is a process of working together for the common good,” he says.

By Thean Lee Cheng

Icelanders reject deal to repay British and Dutch

(Reuters) - Icelandic voters vented their fury on Saturday at the bankers and politicians who ruined their economy, overwhelmingly rejecting a $5 billion deal to repay debts to Britain and the Netherlands, early results showed.


The outcome of the referendum had not been in doubt since Iceland had recently been offered better repayment terms than those contained in the deal on which residents were voting.

Partial referendum results from around a third of the cast votes showed 93 percent opposed the deal and less than 2 percent supported it. The rest cast invalid votes.

But the rejection will still have major repercussions, keeping financial aid on hold and threatening to undermine the center-left government of Prime Minister Johanna Sigurdardottir.

"This has no impact on the life of the government. We need to keep going and finish the (Icesave) debate. We have to get an agreement," Sigurdardottir told public television.

The referendum, Iceland's first since independence from Denmark in 1944, was forced by the refusal of Iceland's president to sign a law in January on repayment terms negotiated by the government and approved by parliament.

He cited public anger at the time. Since then, the anger of the people on this recession-hit island has only grown.

While polls show Icelandic people believe the debts should be repaid, residents bitterly resent being stuck with a bill for the mistakes of a handful of bankers under the watch of foreign governments. The Icesave debts come to more than $15,000 for each one of the 320,000 people on the island.

The debts arose after Iceland's top banks all collapsed within days of each other in 2008, brought down when credit dried up in the global financial crunch.

Around 400,000 savers in Britain and the Netherlands had deposits with one of the banks in so-called Icesave online deposit accounts. The two countries compensated the savers and since then have demanded their money back.

What makes the impasse all the more problematic is that the International Monetary Fund is waiting for the affair to be resolved before resuming financial aid, money which is crucial if Reykjavik is to rebuild a shattered economy.

Iceland, Britain and the Netherlands have been in on-and-off talks for weeks to try to reach a new deal. They started talks once it became clear which way Icelandic people would vote.

But a deal has proved elusive. Britain and the Netherlands softened terms, offering a variable interest rate instead of the relatively high fixed rate contained in the old Icesave deal.

Reykjavik held out. The issue has become so emotive that the government is under pressure to come up with a deal that will clearly be acceptable.

Turnout was high despite freezing rain and howling wind -- not uncommon for March in a country near the Arctic Circle.

A group of several hundred protesters gathered, saying that Iceland should focus on helping its own citizens get through the crisis before repaying foreign obligations.

"No Icesave. No traitors in power. The nation is innocent." read one banner. "Save our homes instead," read another in a loud protest reminiscent of the "Pots and pans revolution" which helped bring down the previous Icelandic government a year ago.

"We want to pay our debts, but we want to do it without going bankrupt," said Steinunn Ragnarsdottir, a pianist who voted in Reykjavik City Hall with her two-year-old daughter.

No political parties are backing the "Icesave" accord agreed in late 2009, not even Sigurdardottir who brokered the deal. She has vowed to stay on after the referendum and said she would not cast a vote in the ballot.

INTEREST RATES

Ultimately, most of the money is likely to be raised eventually by the sale of assets of Landsbanki, which operated Icesave accounts before folding in October 2008.

The focus of the negotiations is therefore the interest on the loan, which Icelandic officials say could knock about $1 billion off their costs.

The Netherlands appears to have hardened its position by linking Icesave with Iceland's hopes to join the European Union.

Brussels invited Reykjavik to accession talks last month.

"The situation has changed," Foreign Minister Maxime Verhagen was quoted as saying by ANP news agency on Saturday.

"Iceland has launched a referendum and the negotiations went wrong. I see that accession negotiations are an additional tool to enforce the agreement with Iceland," Verhagen added.

Iceland's central bank already expects the economy to contract more than 3 percent more this year after a steep fall in 2009. Failure to reach an Icesave deal could make the economic pain much worse, with no aid coming in and foreign companies delaying or scrapping projects.

The Icesave row with the two European Union countries has also rekindled anti-EU sentiment. Support for membership has been falling and is now opposed by more than half of Icelanders.

(Additional reporting by Daniel Zdolsek in Reykjavik and Ben Berkowitz in Amsterdam, editing by Charles Dick)

Friday, 5 March 2010

Rise of the market state

WHEN the Berlin Wall fell in 1989, free market fundamentalists crowed that it was the end of central planning and the triumphalism of their philosophy. Twenty years later, with excesses of fiscal spending and having to bail out the banking system, the Western economies all have very large state involvement in the economy and fiscal deficits are historical huge by any standards.

No country today can claim with an honest face that their banking systems are totally private owned. Many are still being kept on life support by huge deposit guarantees and cheap funding by central banks, including large state ownership. In order to generate employment, governments are spending unprecedented amounts.

How big is the size of the state in the total economy? The more advanced economies tend to have very large governments. France has government expenditure around 50% of GDP and the US at 40% of GDP. By comparison, China and Indonesian government expenditure are only 20% of GDP. According to historical data, for most of Chinese history, government revenue never exceeded 10% of GDP.

Government has grown in size due to growing demand for government services. The minimum government services are defense, security, health, law, infrastructure and education. Government was not always financed by taxation. Throughout history, government has been financed sometimes by monopoly over certain activities, such as sales of salt, tobacco or alcohol. Thus, including state-owned enterprises into the sphere of government activity would increase the size of the public sector.

As Asia grew faster than the West, there has been considerable unease that Asian governments have been much more intrusive and mercantilist than the advanced economies. When Japan became the first Asian economy to join the ranks of industrial countries, the Japanese government was quite keen to push the Japanese model of development, especially the positive role of the public sector. In the 1980s, the Japanese government financed a World Bank Study on the Asian Miracle.

The World Bank economists, who were imbued by free market philosophy, were initially unwilling to accept the fact that governments have a major positive role in economic development. But as they dug into East Asian growth, they realised the strong role government played in fostering sound markets. Indeed, without an active role of Asian governments in building up the infrastructure, devoting resources to education and health and providing political stability and protection of property rights, Asian markets could not have grown so fast. The World Bank economists admitted that Asian state-market cooperation succeeded because the state “mimicked” the market.

Even though the free market World Bank economists hated the idea of governments “picking the winners”, they had to admit that Asian technocrats somehow did select the key industries to develop, but with crucial input from the market. They did not pick winners from thin air, but worked with the market and had good feedback on when to advance and when to retreat.

With the failure of central planning, free market philosophy gained dominance. Throughout the advanced economies, the philosophy was to reduce the role of the state and roll back government intervention. For the developing economies, the advice was to privatize, whereas for the advanced economies, former government activities became joint-ventures through what is known as Private-Public Partnerships. When the governments could not afford to undertake any infrastructure investment, the private sector was invited to invest through Build-Operate and Transfer contracts.

In many countries, this strategy worked and efficiency did increase. But in other countries, privatisation became “piratisation”, in which politically connected elites enjoyed the perfect game – private profit at public expense. Indeed, while economists argued for free markets, the democratic movement was arguing for exactly the opposite, more and more government intervention to deal with social justice, protecting the environment and better social infrastructure.

The global financial crisis has laid bare the free market dogma. The market cannot solve all problems and may create excesses that need to be curbed. If regulation is too market friendly, the system may be captured so that “too large to fail” institutions can hold whole countries to ransom. Indeed, global banks have become larger than national governments who were forced to bail them out with public debt. In less than five years, the US public debt has doubled to 100% of GDP. Governments have been forced to be more intrusive in markets because of the high cost of moral hazard.

Actually, where Asian government has succeeded is not whether the government led the way, but where the balance between government and the market was delicately calibrated. Economies work well where governments knew how to let the market work where it functioned best and the government concentrated on what it did best. The idea of Hong Kong being the freest market in the world is a bit of a myth, considering that half of Hong Kong citizens live in government owned low-cost housing and the government provided superb social welfare. Positive non-intervention did not mean no intervention.

It meant that the government provided the environment for the private sector to thrive, without competing directly with the private sector. How far the pendulum has swing is demonstrated in the recent report that US regulators have begun to ask hedge funds not to destroy trading records on euro bets, as Europe and the US step up scrutiny of the funds’ role in the Greek debt crisis. I still remember when Asian governments asked the developed markets to investigate the role of hedge funds, the advanced market regulators were so skeptical of market manipulation that they set up task forces to prove that the hedge funds were not responsible for the market turmoils in Asia.

By contrast, China recently approved the use of short selling, whereas in 2008 the leading Western banks were the first to complain to their regulators to ban naked short-selling on their stocks to prevent their meltdown.

Regulators investigating the role of hedge funds speculating on the euro would be wise to start measuring the proprietary trading position of their large banks and prime brokers first to find out whether these positions are larger than those of the hedge funds. During the Asian crisis, I learnt that it was not always your enemies who are acting against your interests. If you have friends like these, who needs enemies?

Datuk Seri Panglima Andrew Sheng is adjunct professor at Universiti Malaya and Tsinghua University, Beijing. He has served in key positions at Bank Negara, the Hong Kong Monetary Authority and the Hong Kong Securities and Futures Commission, and is currently a member of Malaysia’s National Economic Advisory Council. He is the author of the book “From Asian to Global Financial Crisis