Digital Transparency & Demographics

Steven Salsberg submitted the following topical thoughts in advance to an economic summit held in Washington to coincide with Inauguration activities:

In my view, to influence the new administration’s economic infrastructure with socially responsible values, those promoting a progressive agenda need to be proactive and specific in addition to innovative.

Here are two areas which I do not see in the topics where I will attempt to be both specific and innovative:

Digital Transparency

It is clear that there will be significant investment in infrastructure as well as a shoring up of bank credit. Some of the justifications for this kind of investment include job promotion and preservation as well as insuring the flow of lending to small businesses and ultimately consumers.

Without revolutionary transparency in the expense of these funds, government runs the risk of the financial system perpetuating previous miscalculations and violating the intent of legislative funding. We have the technological capability to be notoriously transparent for example, where a bank or government entity provides a construction loan, general contractors, builders and other recipients of the funds should be required to make purchase orders, work requests, draw downs, and payments in real time, with transparency to the funders, disbursement agents and vendors.

This kind of digitized transparency not only mitigates risk and insures compliance. It also provides supply chain optimization and can serve a social agenda. For example, where a contract for infrastructure provide funds to a private or quasi-governmental body and the contractor is encouraged to invite bids from minority and women owned vendors, a transparent payment system would not only ensure that this takes place but provide enabling technology in the hands of these new vendors in the work place. A vendor should be able to respond to a bid in real time from their cell phone. The bidding process from P.O. all the way to invoice payment and lien waiver should be notoriously transparent to the lender and even the government body which initially disbursed the funds.

We are likely to see numerous RFP’s and construction initiatives which promise to not only create local jobs but also to build environmentally sustainable projects and material and promote a more inclusive work force. However, anyone familiar with large infrastructure projects knows that construction unions are in fact often unreceptive, particularly in urban communities, to engaging a local workforce. Large scale contractors do not typically diversify their attempts to order goods and services from environmentally responsible, minority or woman owned new sources. Further, many new such vendors are not given enough tools to enable them to bid on larger newly funded projects.

A simple payment and communication system between, general contractors, vendors, their lenders, and governing oversight bodies would facilitate large scale risk mitigation, supply chain optimization and a social agenda of job preservation, new business promotion, innovation and environmental technology.

Demographics

The second area that a socially just economic proposal must address is Demographics.

No one doubts the impact of “Baby Boomers” on the economy over the last 50 years. The 79 million persons born between 1944-1964, shaped our economic and social/cultural order. For a business or political agenda to succeed, it needed to satisfy and speak to the tastes and inclinations of the “Baby Boomer” generation because of their sheer size.

While these baby boomers were followed by a smaller generation know as Generation X, there is not enough attention to the impacts and opportunities related to the emerging new Generation Y.

This 100 million strong generation is in fact much larger than the baby boomers. It’s population Communicates differently and in fact is already embracing very different social values. These “Millennials” statistically unprecedented in size, are in large part, concerned for the environment.

When seniors in high school, are asked for their top 3 priorities, the environment is the only topic which polls 85% and higher. When they respond to polls typically digitally they take owner ship of their response whether they download it to their MySpace page or embrace it social networking. Therefore, rather than advocating or promoting social justice like they needed to in the 60’s and 70’s, progressive bodies should now engage proactively and digitally the massive power of this new generation. Clearly this was done by our new President.