“Perry Sanders and shrewd dealing,” The Colorado Springs Business Journal, May 25 - 31, 2012, 21.

THE MINING EXCHANGE HOTEL

The latest debacle at J.P. Morgan, when $2 billion was lost because of misconceived trades that were supposed to hedge risks, is only the tip of a much bigger iceberg of silly activities that some consider entrepreneur-like; they are not.

Any kind of arbitrage, despite whatever justification made by Wall Street, ends up adding no value to the marketplace. It is defined as “the simultaneous purchase and sale of an asset in order to profit from a difference in the price. It is a trade that profits by exploiting price differences of identical or similar financial instruments, on different markets or in different forms.”

Wall Street insiders may argue about “market inefficiencies” that ought to be exploited to the fullest. But as long as the very concept of “fair value” is itself under greater scrutiny in light of Facebook’s Initial Public Offering, valuing the company at $100 billion, one must pause with incredulity. Remember the dot.com bubble?

There is nothing courageous about betting against one’s own stock, finding minimal deviations in prices—with the aid of sophisticated computer algorithms—in order to squeeze a daily profit. It’s not even risk-taking, unless you are clueless.

And then there are real entrepreneurs, like my dear friend Perry R. Sanders, Jr. I had a small part to play in this downtown saga, so I know what it took to make this dream come true. It was a labor of love that required a vision; and yes, it was and still is as risky as it gets, but he’s not betting someone else’s money.

Having gotten out of the toxic relationship with Landco , Perry was free from the apartment plans they originally agreed to. For him, a hotel was the best use of an existing building, because of parking concerns for residential units.

Perry’s vision was contagious, and I was swept up by it: Perry’s enthusiasm and rhetorical skills, his salesmanship and conviction, honed for years as one of the most successful trial attorneys in the country, came in handy in this project.

We started small with Il Postino—now Springs Orleans—and were gratified to see immediate positive response from the local community. The “bones” of these structures are so magnificent that they provide an aesthetic experience unlike anything else in this town—they take us back to the days of gold prosperity that endowed our city with great legacies.

When we parted ways as partners, we didn’t part ways as close friends. The rule of thumb in partnerships is that most fall apart because of rancor or personality conflict. This was not our case. I have been asked, since the hotel opened last week, if I have any regrets no longer being part of this success story.

There are three emotions that are wasteful, and definitely have no room in a rational business world: anger, jealousy, and regret. I recommend you train yourself to excise them from your emotional repertoire.

Anger is wasteful because, as Spinoza already noted in the 1600s, it merely expresses your own feelings. It’s not a response to someone else’s actions, because you have no control over them. When you yell or scream, you are simply emoting irrationally and finding an excuse to blame someone else for how you feel. Instead of “anger management” try anger elimination.

Jealousy is wasteful as well because it can’t change anything; no good comes out of eating your heart out trying to “keep up with the Joneses”. You should be happy that your friend succeeds, that you bear witness to this success, and that you were helpful in its achievement. There is plenty of room at the top—it’s not a zero-sum game.

Regret is similar to guilt insofar that it’s about what could or should have happened but didn’t. Unlike guilt which is justified if you willfully hurt someone (acted immorally), regret is victimless (you think you hurt yourself in some ways). Heraclitus said, “you can’t step twice in the same river”—what’s gone is forever gone (“water under the bridge”). It’s more productive to focus on the present. Buddhists call it mindfulness. Westerners call it intentionality.

As an entrepreneur, Perry teaches us to focuses on the tasks at hand and get them done. No obstacle is too large for him to circumvent: from bank loans to design and remodeling. His positive outlook and ready smile, his outpour of friendly chatter and tales from across the country, his love of music and people, all contributed to accomplish his dream of bringing a classy boutique hotel to downtown.

As fortunate recipients of his hard work, we should support his dream and make it our own. And whenever tempted, refuse to waste our emotional capital.

Raphael Sassower is professor of philosophy at UCCS. He can be reached at rsassower@gmail.com See previous articles at sassower.blogspot.com

“Is college worth it?,” The Colorado Springs Business Journal, May 18 – 24, 2012, 19.

DISTANCE LEARNING

As about 1,300 students will be graduating today from UCCS, the value of higher education remains controversial: is it worth the money?

According to the National Center for Public Policy and Higher Education, “57 percent of the 2,142 Americans surveyed claimed that the nation's higher education system does not offer adequate value in return for increasingly high costs, and 75 percent feel it is unaffordable for the average citizen.”

Graduating students owe about $1 trillion, more than all the mortgages and credit card debt combined. Colorado is ranked 49^th in the nation in per-capita support for higher education. The CU system receives about 5% of its budget from the state.

Tuition is rising annually to accommodate more students—at UCCS enrollment has tripled in the past twenty years—and a dismal labor market awaits them—less than half will be employed including unpaid internships. So, why bother?

According to the Pew Research Center, “the typical adult with a bachelor’s degree (but no further education) will earn $1.42 million over a 40-year career, compared with $770,000 for a typical high school graduate. “ Is the $650,000 difference worth the $18,704 investment at UCCS?

The obvious answer tells only a fraction of the story. Presumably, UCCS graduates would also have forty years of a more fulfilling job, even a career where their contributions are better appreciated. Can you quantify that?

A study from the University of Maryland found that “the rate of breakups within 10 years of marriage dropped by one-third among college-educated women while remaining stable among less-educated women.”

The Alliance for Excellent Education reports that “about 75 percent of America’s state prison inmates, almost 59 percent of federal inmates, and 69 percent of jail inmates did not complete high school.” Outside of high-profile white-collar crime of Wall Street insiders, college-educated citizens are less likely to end in prison.

A study by the University of Wisconsin Population Health Institute suggests that “the relative health of people in more than 3,000 U.S. counties showed that those with more college-educated residents had fewer premature deaths and fewer reports of being in poor or fair health.” Need we continue?

There are many reasons why college education is good for the individual and for the nation as a whole. So, why is there persistence in criticizing college-bound students? What is it about college itself that irks so many?

Congressional wrangling over rate increases for some student loans is useful for political demagoguery but unimportant compared to other changes to Pell Grant qualification, for example. And all of this pales by comparison to European policies of subsidized higher education for their best students.

The issue then isn’t money as such but ideology: who should pay for college education? Should it be a personal investment? Should the state pay for college education? Or should it only guarantee student loans?

Let’s do some math: B-2 “spirit” bomber costs around $2.2 billion. Annual tuition at UCCS is $4,676. If we skipped buying one such bomber, 470,487 students could spend one year there, or 117,621 students could complete their entire 4-year education.

But how can you mix national security with education? In an age of drone-attacks and “smart bombs,” college-educated soldiers are more important than ever before. Our national security will always depend on smart people rather than raw physical strength. Even the Greeks figured this out, ensuring a healthy mind in a healthy warrior’s body.

Instead of thinking about higher education in terms of skill-acquisition or content accumulation, we need to appreciate our ability to think critically, to assess data collections, and to navigate a new era of digital information that may not resemble anything we have known in the past.

This is true not only for computer geeks and nerds whose genius surpasses the average student—they can skip college, but for the rest of us whose curiosity can be challenged at the university—those who slept through their high-school education.

Since no one wants to close K-12 education, we should remember that teachers are college-educated, and therefore the better their education the better the education of their young students. And what about having better-informed citizens?

Even if everyone agrees to keep higher education and subsidize it, the question still remains: can it be done more efficiently? Can’t it all be transmitted via the Internet?

This may be true for content transmission, even skill-acquisition, but what about education? As more studies show our social misbehavior in the virtual reality of social media, such as Facebook, leading in extreme cases to suicide, we need to socialize our youth to read body language and social cues.

Classroom experiences are about brain-storming and interactive critical thinking.  Especially in the Digital Age, we need more of this training rather than less.

Raphael Sassower is professor of philosophy at UCCS. He can be reached at rsassower@gmail.com See previous articles at sassower.blogspot.com