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Proof of value from Opportunity Zones won't come quickly

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Any legislation created by Congress with the promise of helping the rich get richer by providing for them to help the poor is bound to be challenged from its birth, faced with a mix of believers, skeptics, opportunists, and cynics.  
 
So it is with the Qualified Opportunity Zones (QOZ) provision in the Tax Cuts and Jobs Act of 2017 that will permit those owing capital gains tax to delay, reduce or even totally avoid those taxes by investing in special funds designed to start businesses and provide other steps to help economically distressed communities.
 
Ralph IbarraRalph IbarraAnd now the OZ legislation, signed into law by President Trump three days before Christmas in 2017, a sort of holiday gift to taxpayers and, significantly, a bipartisan one, is drawing a lot of scrutiny from critics who contend it is turning out to be merely a tax break for billionaires and focused far more on real estate projects than on job creation.

Supporters counter that much of the criticism has a political ring to it a year before the presidential election in which Trump could point to it as an example, albeit a rare one, of Congressional bipartisan progress.
 
Meanwhile, officials in most states, including Washington, have been slow to roll out examples and promote projects the act has made possible with its capital gains tax breaks. Nor has there been much creativity on the part of state leaders to convince some of those wealthy investors to look at potentially winning projects, or in maybe putting state funds into projects that, coupled with the tax breaks, could become attractive for major investors.
 
The "politics" accusations are coming because Congressional opponents are starting to discuss what they see as the need for changes, including a possible effort to terminate zones that are not sufficiently low income. That was one of the key criteria for census tracts to gain OZ eligibility in the original list put together by the Treasury Department.
 
A recent high-visibility example of the criticism was a New York Times article that rained vilification down on Michael Milken, alleging that he tried to take advantage of the Opportunity Zones tax incentives to enhance the value of some of his Nevada property.
 
The Times article indicates that Milken, still widely recalled more as the billionaire king of junk bonds who went to jail than remembered for his decades of philanthropy since then, sought to press the Nevada governor and state officials to get the Treasury Secretary to classify the tract as an OZ.
 
There no real evidence that Milken did that, and there was no effort to paint any of his actions as illegal even if he had.  
 
The parcel was eventually included in the eligible census tracts, despite Treasury's concern that the residents were too well off to get the designation. Once included it was selected by the governor as one of the state's Opportunity zones.
 
Ironically, that Reno area OZ parcel in which Milken owns about 700 acres, contains many of the potential job-creating aspects of what proponents of the tax break indicated they hoped would come about, including a planned tech incubator where smaller companies could set up operations and seek investors.  

My longtime Latino friend Ralph Ibarra, a fan of the Opportunity Zones idea from the outset who has delved deep into the details of the tax-break legislation, says he felt it was a "golden opportunity" to provide a chance for investors to get involved to achieve good ends.
 
"if you want to get investors to act in their enlightened self-interest you incentivize them in ways they understand and that's by offering them the opportunity to get a return," said Ibarra, who has shared several ideas on how he might get involved in ways that would generate returns for his clients and causes from OZs.
 
When I mentioned the Times Article on Milken to Ibarra, who as president of DiverseAmerica Network helps corporations with diversity issues and small businesses with access to opportunities, he said he didn't see a problem.
 
"Using your influence in that way is no different than the Port of Tacoma going to the governor and saying 'it would be helpful if you designated the Tacoma Tide Flats as an Opportunity Zone so we can attract capital to some projects.'"
 
"In fact, I did it myself when I looked at every potential opportunity zone from Seattle to DuPont, intending to try to influence the process, then went to the Lieutenant Governor's office and suggested ones I thought should be selected. I said 'respectfully here are tracts that I believe are worthy of being selected because of the lack of equity capital for small and distressed firms in those areas.'"
 
Ibarra's point was he was seeking to use his influence with the lieutenant governor because of projects he had been involved with relating to the state's second-highest elected official.


Sen. Tim Scott, R-South Carolina, who wrote the 2017 Investing in Opportunity Act measure that was filed and then forgotten in committee, gathered support from moderates of both parties in a true example of working together to revive the bill as an addition to the major tax bill. Thus was born the Opportunity Zones.
 
Governors of the 50 states were brought into the implementation of the act by having the chance to designate census tracts where various business ventures would be eligible for the OZ benefits, through investment by Qualified Opportunity Funds.
 
Jessie J Knight JrJessie J Knight JrA key business figure I asked about the emerging criticism of wealth-enhancing projects just getting off the ground was Jessie J Knight Jr., a retired prominent San Diego business leader closely involved with oversight of the OZ legislation and one for whom philanthropy has become a retirement focus through his family foundation, Knight's Angels.
 
Knight, a retired Alaska Airlines board member who was chairman of San Diego Gas & Electric and Southern California Gas Co. both subsidiaries of Sempra Energy, where he was executive vice president, said: "judging this legislation on projects already in place is short-sighted and ignorant about economic development."
 
I reached out to Knight because he is one of the national business leaders selected to serve on a task force chaired by Vice President Michael Pence and Senator Scott that is overseeing the progress of the OP-zones program.
 
"This effort can only be judged in what new investment doors are opened to the private sector in the short run, and in the longer term, what businesses and communities have been improved in years five, seven and 10 (the years in which capital-gains taxes due are evaluated for reductions)," Knight said.

An effort at work in Washington may help provide the model for how Opportunity zones can help bring progress and job creation to economically deprived areas.
A working group, that includes Chuck Depew and the National Development Council for which he is a senior director and West Team Leader, is working with local communities and has come up with some promising projects, in Wenatchee and on the Colville Reservation in Central Washington.

The involvement of the state's Native American Tribes and Opportunity Zones designated near or adjacent to them has yet to fully emerge, but will be essential to future success, Depew says.

But he cautions, with a message that critics of OZ need to digest, that projects that will attract mission-driven investors who want to do good while gaining financial return take longer to put together than the low-hanging fruit that has attracted the wealthy investors looking only to get easy tax breaks.

"The challenge in the program is how can Opportunity-Zone communities, rural, urban and tribal, encourage mission-driven investors, including private, community and family foundations and social impact investors to be involved," Depew told me for an earlier column. "That takes time and resources."
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Serial entrepreneur Pete Chase carving out a key role in 5G cell technology

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Serial entrepreneur Peter (Pete) Chase is sympathetic to the pushback from communities upset about the impact of looming 5G cellular technology on their esthetics and infrastructure, but he's convinced the new company he's putting together will help ease much of that community concern.
 
Chase, whose Easy Street Solutions will be based in his hometown of Spokane, is referring to the suit filed by more than 100 municipalities around the country, including Seattle and Bellevue, against the Federal Communications Commission over its plan for the rollout of 5G networks across the country.

Pete ChasePete ChaseThe 5G stands for fifth-generation cellular wireless, which will be required in order for industry leaders AT&T, T-Mobile, Verizon, and Sprint to develop and introduce new wireless communications platforms, including the Internet of Things (IoT). This is a transition from existing networks that will require millions of what are described as "small cell towers" placed mainly in urban areas where data usage is greatest.
 
The politics that is accompanying the emergence of the new networks is that the FCC has pre-empted the right to control how the networks of new towers come about and that has local officials up in arms because they are basically being pushed aside on details of things that could have a major impact on the communities.
 
As PC Magazine noted in an article in its August issue, "you should expect the big 5G applications to crop up around 2021 or 2022 and until then, things are going to be confusing as wireless carriers jockey for customers and mindshare."
 
Meanwhile, Chase will be seeking to attract investors as well as wireless carrier "mindshare" for a company that he says will produce towers that "will fit well into the look of the communities."
 
"What we are doing is designing a very aesthetically flexible pole, 20-to-40 feet in height and one-tenth the weight of current poles and one that allows a lot of different options," Chase explained. "These will fit well into the look of the city."
 
"The FCC and carriers need to work with cities to find solutions that make both happy," said Chase. "The big thing for the FCC is that we need to beat China to 5G and you can imagine that China is not going to spend a lot of time thinking of things like building permits," he added with a chuckle. "However, I did see that China is claiming 5G systems are up in several cities - they are definitely ahead of us at this time."
 
"You can't blame communities who feel they have the right to make their own decisions, only to watch that power taken away," Chase said.
 
"Something to note about the FCC mandate is that along with insisting that cities not slow down 5G projects, they also are capping the lease rate per site that the cities can charge the carriers, Chase added.
 
"It's an educational thing on both sides since the cities need to understand that if they want 5G in their cities, they have to work with the carriers.
 
And the carriers need to accept that they can't just start to put up ugly poles everywhere since these poles will be about 800 to 1,000 feet apart."
 
As he begins seeking investors for Easy Street Solutions, which, Chase says is a name that "addresses the issue of how do you deploy this technology and make it easy for all stakeholders," he is likely reminded of his first entrepreneurial go-round with a telecom startup, Purcell Systems.
 
That was in 2000. He was 40 and recalls with a smile that he was guided in that launch by "blind optimism" in the future of what became a $140 million revenue company as a maker of outdoor telecommunications cabinets.
 
The company was sold six years ago to NYSE-listed EnerSys, a manufacturer of batteries for various uses, for $115 million.
 
His success with Purcell earned Chase official entrepreneur status with selection as an Ernst & Young (E-Y) Entrepreneur of the Year and for several years thereafter he was a judge in the EoY competition.
 
His entrepreneur focus took Chase in an unusual direction after Purcell as he launched Columbia International Finance in Spokane to become a player in the Immigrant Investment Program called EB5 that was passed by Congress 30 years ago to stimulate the economy through investment by foreigners. The vehicle was to grant green cards to a specified number of foreigners in exchange for $500,000 invested by each foreigner in projects in this country that created at least 10 new jobs.
 
Chase said he intended to use the EB5 program, which initially and quickly turned into a real estate financing tool by developers, as what he called a "true economic development tool," focused on funding new businesses across the state rather than just real estate.
 
He applied for and was granted approval for Columbia International Finance to be a regional center, which the act decreed would serve as the vehicles to turn the investment dollars into job-creating projects.
 
He found little opportunity in Spokane but got involved in several projects in Seattle to which he directed foreign investments but laments that congressional action to raise the $500,000 investment fee to $900,000, effective Nov, 21, "is going to put the brakes on the program. It's a victim of the effort by Congress to slow applications down because they just don't want immigration."
 
So turning back to his 5G initiative, I asked Chase: "If blind optimism was the attitude you brought to Purcell, what's driving your 5-G effort?"
 
"Confident zeal," Chase replied quickly. "Nothing will stop the growth of data and the Internet of Things, but you have to have a reasonable solution to 5G deployment to pull it off. We do the extremely necessary dumb stuff to make the smart stuff work."
 
"But it's important to remember that 5G networks don't exist now, although there is certainly testing in some venues like sports arenas, so what's in play right now is a lot of marketing fluff," Chase said, adding that "real 5G is probably two years out for the average consumer."

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As he turns 94, Dan Evans' role in history will be discussed at Tower Club interview

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We call the Columbia Tower Club's breakfast interviews On the Shoulders of Giants in the hope that those who accept the invitation to be our guests fit the role of giant whose shared wisdom can permit us to stand on their shoulders, as it were, to perhaps learn from them in shaping our own futures.
 
And despite his likely reluctance to accept the "giant" characterization, former Governor and U.S. Senator Dan Evan comes about as close as any public figure in this state to earning the accolade "giant."
 
So we hope to put some of his thoughts and deeds on display and in the discussion next Friday morning, October 25, the date when he has agreed to be our guest interviewee.
 
DanielEvansDaniel J EvansIt was 55 years ago this November that Daniel J. Evans was elected governor, the state's youngest governor, defeating two-term incumbent governor, Albert D. Rosellini, who was seeking a third consecutive term in the 1964 election. Evans bucked a Democrat landslide nationally that year in winning.
 
It was an election season not unlike this one in terms of the fierce political battles that then, as now, even created divisions within parties, with the John Birch Society creating a right-wing focal point for Republicans.  
 
Despite being a Republican and a self-styled conservative, Evans became known for his administration's liberal policies on environmental protection as he founded the country's first state-level Department of Ecology, which became President Nixon's blueprint for the federal EPA.
 
He was a strong supporter of the state's higher education system, including founding Washington's system of community colleges.
 
And he fought unsuccessfully for a state income tax, basically telling voters that if they rejected his tax plan they maybe should reject him as well. But voters made up their own minds and kept Evans while rejecting his income tax.
 
He achieved national prominence in 1968 as he was chosen to give the keynote address at the Republican National Convention that nominated eventual president Richard Nixon. Evans was talked about for a time as Nixon's possible running mate but his refusal to endorse Nixon, instead of throwing his convention support to Nelson Rockefeller, ended vice president talk.
 
In reflecting on Evans in preparation for the interview next Friday, I went over some previous columns I did on him and was reminded that he was an elected official who was impossible to pigeonhole ideologically. As both governor and senator, he avoided ideological rigidity and found good ideas might sometimes spring from the Democrat side of the political aisle. And that dumb ideas could sometimes be offered by his fellow Republicans.  
 
Proving he was impossible to typecast politically, Evans was equally comfortable blasting "talk show hosts screeching about waste in government," proponents of term limits and a balanced-budget amendment, environmental extremists, and excessive regulations that stymie growth.
 
In a memorable speech he made in Seattle to an audience of business leaders in the mid-90s, Evans offered a couple of bits of political wisdom that bear sharing.
 
"By constantly trashing our political leaders, we also breed disrespect for our own system, of government," Evans said. "The result is a new political landscape dotted with constitutional amendments and initiatives designed to protect citizens from 'evil' politicians."
 
Of two ideas whose proponents have continued to seek traction, Evans told a business-leader audience: "The balanced budget amendment is a loony idea that is meaningless until we decide how to keep a national standard set of books so we can measure balance."
 
And of the idea of term limits, Evans offered: "As a voter, I am outraged by those sanctimonious term limiters who would steal from me the freedom of my vote."
 
But in addition to hitting "those talk show hosts who cater to the base emotion of people," he took to task "the politicians who blithely promise what they know they cannot deliver," and "those rigid environmentalists who will see you in court if they don't get all they seek."
 
Thus he has always been a leader in what I, and many, feel is an unfortunately disappearing breed, those who view ideas on their merits rather than insisting that any new idea must be vetted based on where it fits ideologically.
 
Evans celebrated his 94th birthday this week with friends, followers and admirers, and students of history, still awaiting completion of his autobiography.

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79-year-old runner gets unusual support to overcome injury and race

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The phrase "senior support group" takes on a whole different meaning when the senior is a 79-year-old seeking to remain athletically competitive and the support group is a trio of unusual healthcare providers and a nationally prominent track and field coach seeking to contribute to the process.  
 
Members of this particular senior support group came to the fore in the past three weeks to see if collectively they could salvage my hope, after a leg injury while working out, to get to this year's Huntsman World Senior Games in St. George, UT, where I have competed in my age group in the 100-meter sprint half a dozen times in the past decade.
 
The support team is composed of Bryan Hoddle, one of the nation's most recognized and honored track and field coaches; Dr. Robert Greczanik, an acupuncturist, and practitioner with athletes both amateur and proof what he calls "energetic technologies;" high-intensity trainer Ann-Marie Anderson, and skilled Reiki practitioner Trini Evans. Interestingly, they are also teamed in that they are each other's friends and clients, as I am their client or, in Hoddle's case, friend.
 
Hoddle and Anderson have both been subjects of Harps (Flynn's Harp: Bryan Hoddle and Flynn's Harp: Ann-Marie Anderson) while columns on Greczanik and Evans are in planning, not because they are friends but because what they are doing to bring new definitions to healthcare merits attention.
 
The challenge they are now helping to address with me is that during a recent workout on a Bellevue track, as I wound up my workout with a series of full-speed 100's, near the 80-meter mark of the second 100 meters, it suddenly felt as if an alligator had bitten into the base of my right hamstring. I instantly knew I had torn it, or at least pulled it.
 
The details that follow will be interesting to some readers, amusing to others who think they know all about sports medicine.
 
I called Hoddle to ask if I could do any sort of exercise in the following three days before I could get in to see "Dr. Bob," given the injured hamstring and pain accompanying it.
"Don't do anything until you see Dr. Bob, and make sure to ask him if you locked your big toe," he added.
 
It was a weekend and I knew I wouldn't be able to see my acupuncture doc, "Dr. Bob," at his Energetic Sports Lab in Bellevue until Tuesday since Monday is the day for Seahawks to see him repair game day injuries.
 
Robert Greczanik, known to most as "Dr. Bob," has a doctorate in the practice of acupuncture as well in Oriental Medicine and for 20 years has been serving athletes (and others) to "achieve peak performance," avoid injuries and recover rapidly when injury does occur.  
 
Acupuncture is a technique in which practitioners stimulate specific points on the body by inserting thin needles through the skin. It is one of the practices long used in traditional Chinese medicine.  
 
Since he has worked with organizations and athletes from the Seattle Seahawks and Sounders, Buffalo Bills, Los Angeles Clippers, Portland Trailblazers and numerous other pro and college organizations and individuals, I was pleased and grateful that he has had time for an old runner. Being friends helped.
 
When I asked Bob about Hoddle's "frozen big toe" comment, he replied that I hadn't frozen it but he made the point that "most people are unaware of the fact that there are fibers in the big toe that help determine the health of the hamstring as well as other parts of the body. Yours is okay."
 
I remarked to Dr. Bob that I realized there was no way I was going to be able to run a competitive 100-meter race in three weeks but that I'd like to begin getting my hurting hamstring back to health.
 
"Hey, 'white lightning' (his nickname for me that he knows will bring laughter), don't worry about it" he replied. "You'll be running fine by then.'
 
So he placed the needles in my hamstring and areas in the other leg and after 25 minutes on the table, he removed them and the hamstring felt like new. But I realized I needed to avoid full-speed effort until the race day.
 
"So what can I do on the track now," I asked and Dr. Bob replied, "ask Coach Hoddle."
 
Coach Hoddle counseled me to do 40 percent-speed work out on the track, followed by 60 to 70 percent speed three days later. "I tell my guys returning from an injury to remember the 72-hour rule."
 
Hoddle is one of the nation's most recognized and honored track and field coaches whose attention to developing young athletes and counseling coaches came to include aiding disabled athletes and now a national focus on wounded veterans who have lost limbs and need to learn to run again.
 
And he's full of sayings, as in when I worried that I wished I could get one more workout in before heading for St. George, he said "Don't worry about it. The hay is in the barn." When I asked what that meant he replied: "You're set. Don't need any more preparation." Hd followed that with "People don't realize that less s frequently better."
 
When I returned to Dr. Bob the following week, he placed his needles in several places but none in the injured hamstring and when I questioned that, he replied "Hamstring is all well now. Go for it."
 
Meanwhile, sessions with my high-intensity trainer to keep muscle strength as close to normal as possible and Reike to enhance the healing, as well as deal with a sore back muscle, added key elements to the return to health.
 
Trini Evans, my Reiki Master/Teacher practitioner in the form of healthcare that is based on the idea that human hands can redirect "life force energy" to heal stress and assist in the body's natural healing processes, became a key part of the healthcare team seeking to restore my ability to compete.
 
In addition to the Reiki healing process, she regularly provided the counsel "relax. Focus on your ability. You'll do fine." Maybe that was mental Reike.
 
Interestingly, Reiki is now viewed by many as an effective, accepted alternative practice in mainstream America, where at least 1.2 million adults have tried the energy healing therapy that 60 hospitals have adopted as part of patient services and education that is reportedly offered at 800 hospitals.
 
And the high-intensity training sessions with Ann-Marie Anderson, one a week, as I have been doing with her in her Ideal Exercise Gym for more than three years, became important for her focus on ensuring that I retained the upper-body strength key for sprinting.
 
Anderson is a nationally recognized leader of a small but growing group of practitioners of an exercise technique called high-intensity resistance training, which Greczanik, also one of her clients, describes as "the new paradigm of training."
 
So after my workout on the track at 90 percent of full speed over the weekend, I told each member of the team this week: "Thanks, guys. I didn't really expect to be ready for the starting line in St. George after the hamstring pain hit, but I now know I will. So we'll see when the gun sounds mid-morning on Oct. 16 how many seconds before I reach the finish line, as well as how many guys got there ahead of me."  
 
Oops! Each of my healthcare team has admonished or scolded me on several occasions in the past three weeks to quit focusing on the idea that some will be ahead of me. "Sorry, guys!"  
 
The reality is I've never taken first in this race at the Games, but I've taken 2nd, 3rd, 4th, and 6th. So some year there may be no one ahead of me at the finish line.
 
So of the Huntsman World Senior Games themselves. The late Jon Huntsman Sr.'s vision of creating an event that would attract hordes of seniors to Southern Utah annually to engage in competition with each other if he named it the World Senior Games has become, over three decades, likely the most successful event of its kind in ...well...the world.


As many as 10,000 seniors show up at the remote corner of the West over the two weeks to compete in the Games, which include events ranging from track and field and tennis to golf, archery, bowling, cycling, lawn bowling, and various others.

So back to this year's Games. All those on my team have joined the ranks of friends important to me and I to them. So perhaps the best incentive next week in St. George will be that I don't want to let them down.
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Two with deep roots in Bon Marche share demise thoughts

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Macy's announcement that it will close its downtown flagship store and thus bring permanent closure to the last vestige of the retail icon whose decades of visibility as simply The Bon was actually ended by Macy's in 2005 prompted two people for whom The Bon had deep roots to share their thoughts on what it meant to Seattle retailing.
 
One, Chuck Nordhoff, recalled how his great grandparents, Edward and Josephine Nordhoff, she 18 with a two year old daughter and he 32,, came west to Seattle from Chicago in 1890 to create a small dry goods store they named the Bon Marche, after a famous 1800s retailer in Paris, a European capital where Nordhoff worked for a time.
 
john BullerJohn BullerJohn Buller, on the other hand, had a key role in shaping The Bon competitively and changing the culture of the retailer in the '80s when, as training director and Director of Corporate Culture, researching the history of the company was part of his approach to aide employees in understanding their roles as current employees. He described his role to me as "changing the culture from a clerk environment to a selling environment."
 
In his research relating to history, Buller discovered some of the details that helped fashion The Bon's early appeal and that built regard for the Nordhoffs among citizens of what was, at that time, a population of about 40,000 residents scattered in and around the Seattle area.
 
One was the fact that Edward Nordhoff was one of the earliest discount retailers and the story of how he fashioned that role is an amusing bit of history that should have been more enduringly told.
 
It seems that Nordhoff, in the face of competitors who included Donald E. Frederick and Nels B. Nelson (like the Nordhoffs in their 30s when they founded Frederick & Nelson) went back to New York and returned with thousands of pennies. He gave customers back a penny for each dollar spent, basically offering a 1 percent discount on all purchases, the idea of a 1 percent discount being nothing to sneeze at in those days, apparently.
 
Chuck Nordhoff's thoughts are more future-focused as he shared with me concern about what will become of fixtures and parts of history still located on the walls and doors in the store.
 
"If there's one thing the family is interested in, it's what will happen to things like the bust of Josephine Nordhoff over the elevator door and the series of panels that are mostly dated from the earliest era, including one panel that talks of Josephine," he said.
 
He suggested there would be room for such memorabilia in the Museum of History and Industry, whose board he has been a member of and chaired.
 
In fact, Josephine Nordhoff is a woman appropriate to be remembered well beyond the store. Little recalled is her role as a prominent Seattle businesswoman. In fact, Edward Nordhoff credited her with guiding the success of the store. She was also a prominent supporter of community causes, including the Seattle Day Nursery and the Seattle Orthopedic Hospital Association.
 
As early as 1918, she championed the eight-hour workday, a controversial position at the time. She died of cancer in 1920. On the day of her funeral, all of Seattle's major downtown retailers closed their stores in her memory.
She was the first woman inducted into the Puget Sound Business Hall of Fame early in the history of the event created by Junior Achievement and the Puget Sound Business Journal.
 
Nordhoff recalls that his father, Arthur, who turned 90 on September 11, was born a year after The Bon was sold to Hahn Department Stores. Five years later Hahn Stores was bought by Allied Stores Corporation.


Chuck Nordhoff recently turned 60 and climbed Mt. Rainier with his 17-year-old daughter to celebrate the occasion.
 
"I did it 16 years ago as a belated celebration of my 40th and I promised myself I'd not do it again unless one of my children  invited me to do it with them," he chuckled, given that the invitation came for this birthday.
 
Regarding Buller and his history notes, few know that The Bon Marche drug store was the largest drug store business in the state, or that the store the then-new store that opened in downtown Seattle in the 1900s was the largest department store on the Pacific Coast.
 
And Buller notes The Bon's focus on sportswear and young men's casual business apparel created an industry based in Seattle with the likes of Brittania Jeans and Union Bay apparel. And Walter Schoenfeld, who founded Brittania (as well as being a founding investor in three Seattle pro sports team), was convinced to bring jeans in from Hong Kong in what Buller noted was one of the first retailers to get clothing from a foreign country.
 
I did a Harp on Buller several years ago that focused on his book "Survival Guide for Bureaucratic Warriors, based on his experience at The Bon training the company's 4,000 employees spread across the region. His duties eventually included the role of vice president of marketing, overseeing the operations of the company that had spread across cities in six northwest states.
 
"Changing the culture at The Bon was an effort to focus on service, both to our customers and our internal attitudes toward our fellow employees," Buller explained of the approach that led to the book.  "The book was about my learning the difference between a 'Soldier,' someone who takes orders, and a 'Warrior,' one who has a mission or a cause. I learned how to be a Warrior."

As I wrote in the column on Buller, now 72 and still entrepreneurially active: He took the warrior attitude, and the details of building survival skills, to roles as co-chair and director of the organizing committee for the NCAA Final Four in Seattle in 1995, executive director of the UW Alumni Association, CEO of Tully's Coffee and CEO of the Seattle Police Foundation.
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'Encore Entrepreneurs' a growing reality for seniors support groups

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The director of Income Security at the AARP Foundation, Aliza Sir, seems an unlikely messenger for her talks to entrepreneur-support groups with her attention-getting message that today's entrepreneurs are just as likely to be empty nesters or grandparents as typical tech-savvy younger people.

So it's appropriate on this World Entrepreneur's Day, created by the Alliance of International Business Associations to focus awareness on entrepreneurship and innovation, for the entrepreneur-focused Kauffman Foundation to discuss "encore entrepreneurs," in keeping with Sir's message.
 
When I retired in 2006 and bought the domain name "Entrepreneurial encore," it was because I knew that would characterize my post-retirement path and that at some point, I could create a website with that focus for others seeking the same encore. I just didn't realize that I was merely ahead of the curve.

Kauffman, the Kansas City, MO, organization that is the nation's largest non-profit focused on entrepreneurs, notes that "America is not getting any younger," adding that "in fact, last year the U.S. Census Bureau's national population projections forecast that by the year 2030, older people, 65 years and older, will outnumber children under age 18 for the first time in U.S. history."

And Kauffman's most recent Index of Startup Activity points out that the highest rate of entrepreneurial growth over the last few years is not Gen Y startups but Boomers over the age of 50, a trend that has attracted the tag "Encore Entrepreneurs."

According to the Kauffman Indicators of Entrepreneurship, the percent of the U.S. population that starts a new business is highest in the 45 to 55 age category at 39 percent with the 55 to 65 age group following closely behind at 38 percent. In both age groups, the number of new startups trends upward. Moreover, the percent of new entrepreneurs who created a business by choice instead of necessity in the 55 to 64 age categories registers just over 88 percent, higher than any other age group.

"The future of work is something that we think about a lot," Sir added. "The trend of older entrepreneurs offers amazing potential for people to leverage their experiences, work for themselves, and transform Main Street economics. It's incredibly important to celebrate and lift up those entrepreneurs."
 
Comes now the State of New York with a leading-edge initiative that is most likely to spread to other states, and hopefully, Washington State will be at the forefront.
A bill called the "encore entrepreneur,", proposed by Sen. Rachel May, a Syracuse Democrat would establish training and education programs across the state to allow older citizens to more easily open and operate their own businesses. It's been approved by both houses of the legislature and is awaiting signature.
 
"What we're seeing in New York and around the country is that, more and more, there are people over the age of 50 turning to entrepreneurship," said the lawmaker's chief aide. "We need to understand that, while New York's population is getting a lot older, it doesn't have to be a problem. We need to see it as an opportunity. And one opportunity is the potential for encore entrepreneurs."
 
Supporters of the legislation say it will establish a more robust system that would allow the state to better incorporate older citizens into the economy.
 
As key supporters note, "many older people have significant work experience, deep networks of contacts and are typically placed in the low-risk lending category."
 
But many seniors often lack direct knowledge of starting and growing their own business or maybe intimidated to work in an incubator space surrounded by dozens of millennials decades younger.
 
My first reaction to that was that as WeWork, with its the soaring success, has changed the way people think about work and office spaces and Seattle-based Riveter has created a model for co-working space for women, some entrepreneur will soon come up with a plan for co-working space for seniors.
 
The New York plan could lead to something like dedicated educational and mentorship programs directed towards seniors within a business incubator, or it could be a dedicated space for just seniors to work in.
 
"No state to date has done much to explicitly support senior encore entrepreneurship," he said. "One of the reasons that we felt a piece of legislation was important is to nudge the state into taking more of an active role," said the New York lawmaker's aide.
 
At my retirement party, as I left Puget Sound Business Journal's publisher role in April of 2006, the late Herb Bridge said to me: "I can't envision you being retired, Mike."
 
"Herb," I replied, "there are various ways to retire. It's like if your tires are getting in need of a change, you drive into Costco to get a new set of treads and you emerge re-tired and ready for another trip."
 
I figure an increasing number of those like me, including a number of friends reaching 70s and beyond, will find themselves looking to re-tire for a new trip and that a growing number of support services, including from states and dedicated workspace, will emerge to help fuel the trips.
 
My friend and venture capitalist John Fluke Jr. has a message for senior entrepreneurs that relates to not trying to fly alone and reminds those hoping to find investors for their businesses that most of the investors that seniors might hope to attract are likely to also be seniors, well into their 60s or beyond.
 
Fluke is chairman of Fluke Venture Partners and chairman of Athira, the regenerative-medicine biotech that is attracting national attention to its human trials on a drug to regrow brain cells and in which he and I were fortunate enough to be the first two investors (at dramatically different amounts!),
 
He says his interest in investing in an entrepreneur company has more to do with the team being assembled than in the age or gender of the entrepreneur.
 
A lone entrepreneur is going to be less interesting than one who has begun to assemble a team, Fluke said. "There's a reason why a commercial jetliner always has two pilots."

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Is the Age of Google over? Discovery Institute summit to explore 'disruption and convergence'

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Seattle's Discovery Institute is planning what it's billing as a national technology summit in Bellevue in late October with some of the nation's most noted experts in areas from technology to economics on hand for an event with the compelling goal "to explore the impacts of the coming technology disruption and convergence."  

And it may be that while the topics for the October 23-25 event range from artificial intelligence, blockchain, crypto, and international political impacts, the best draw may be the discussion of "life beyond Google."

The summit gathering is called COSM, which Discovery Institute president Steve Buri explains is not an acronym but means the world and stands for what organizers tout as the era of emerging and converging technologies.

Tom AlbergTom AlbergThe event, which will be held at the Bellevue Westin, is the brainchild of George Gilder. Discovery Institute co-founder and noted lecturer and author who is described as "a peerless visionary of technology and culture." 

He was, among many things for which he is prominent, a proponent of supply-side economics in the early '80s, particularly through his best-selling Wealth and Poverty in 1981.

With the increasing controversy about Google, its social media pervasiveness and the growing concern about the security of personal information, there are likely to be more than a few attendees eager to learn more, including from Gilder whose Life After Google: The Fall of Big Data and the Rise of the Blockchain Economy may key discussion.

The Age of Google, built on big data and machine intelligence, has been an amazing time. But conference speakers are among those who say it's coming to an end.

In Life after Google, Gilder explains why Silicon Valley is suffering what he refers to as a nervous breakdown over what lies ahead and what to expect as the post-Google age dawns.

And Gilder won't be the only guest speaker challenging Google's supremacy. Peter Thiel, founder of PayPal and one of the most successful and controversial venture capitalists, has a problem with Google.

In an opinion piece for The New York Times, Thiel accused Google of being unpatriotic for operating an artificial intelligence lab in China while simultaneously developing artificial intelligence for the Pentagon. Thiel has been prominent in his criticism of Google in recent years and at a July speech at the National Conservatism conference, he called the research "treasonous."  

In addition to Gilder and Thiel, speakers include Steve Forbes, Ken Fisher, inventor, and futurist Ray Kurzweil and venture capitalist Tim Draper, a major proponent of Bitcoin and decentralization.

The conference is targeted toward anyone seeking to peek into the future of technology, including corporate senior executives from CEOs to CIOs, investors, researchers, and technologists.

The summit is being co-sponsored by Seattle-based Madrona Venture Group, whose founder, Tom Alberg, will serve as co-chair as well as moderator of a panel on alternative vehicles, called "Will Pilots and Drivers Soon Be Obsolete?"

This is a topic of particular relevance to the Seattle area as Bellevue pursues a strategy focused on an eventual 23,000 autonomous vehicles with autonomous vans as their primary transportation role. Meanwhile, Seattle's $68 billion Sound Transit light rail system could face a challenge from driverless cars in its effort to attract rail supporters.

Steve BuriSteve Buri"Technology and Science are ever-present in our lives, actually more obvious than they have been in previous decades given the phone in our pocket and constant news flow that raises questions about where it is all going," said Alberg. "COSM will bring together people from different backgrounds and points of view to talk about the impact of science and technology on culture.  These are the conversations we have around the dinner table and Seattle has experts in so many of these areas."

"Rather than being focused on specific areas of technology - we are going to take a broad look at the big themes that will continue to have an impact for decades to come," Alberg added.    

An interesting focus at the conference will be on cryptocurrencies, including a first-day panel on the question: "Can crypto reverse the tech decline (and enable an internet renaissance)?"

As Gilder puts it: The future lies with the "cryptocosm" - the new architecture of the blockchain and its derivatives. Enabling cryptocurrencies such as bitcoin and ether, NEO and Hashgraph, it will provide the Internet a secure global payments system, ending the aggregate-and-advertise Age of Google."

"Silicon Valley, long dominated by a few giants, faces a 'great unbundling,' which will disperse computer power and commerce and transform the economy and the Internet," he added.

Or how about this discussion point from Gilder: "The crisis is not just economic. Even as advances in artificial intelligence induce delusions of omnipotence and transcendence, Silicon Valley has pretty much given up on security. The Internet firewalls supposedly protecting all those passwords and personal information have proved hopelessly permeable."

That discussion alone strikes me worth the price of admission to an event that Buri said Discovery Institute hope will become an annual summit event. Meanwhile, it is looking for other sponsors for this first event.

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Mike Kunath, 'a true Renaissance Man,' remembered, as is his table

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S. Michael (Mike) Kunath, who died in his sleep early Saturday after a nearly two-year battle with cancer will be remembered for his successful financial guidance of some of the region's most prominent business people, his active support of charitable causes and his nurture of entrepreneurs.  
 
But for many who knew him, their memories will start with his table at the Fairmont Hotel where plans for most of his business, charitable and community involvements took shape and were vetted by those gathered there.

Kunath was a fan of this column and once hired me to help him create his own blog. And he often said to me: "You should write a column about this table." So here it is, Mike: a column about the table, and the unforgettable guy who held court there for nearly a quarter century through ownership of two hotels.
 
It was always an interesting group gathered over wine at his oval table just outside the bar at the Fairmont, whether they were there for important business discussions or merely someone wandering through the hotel lobby and invited to sit down. All looked on as any newcomer was advised by Kunath, leaning to his side in his chair, in earlier years, puffing on his corncob pipe: "tell us who you are and why you are here."
 
But first briefly about his background before reflection and recollections on the man his 46-year friend and co-investor in various businesses and charitable events, Brendan O'Farrell, referred to as "a true Renaissance Man for All Seasons."
 
Kunath was the son of a diplomat and spent his growing up years being educated in various places in the world before attending the University of San Francisco as well as Seattle University from which he graduated, then got his MBA. After time as a financial advisor, he became a founding partner and principal at Kunath, Karren, Rinne and Atkin, LLC in Seattle.
 
One of the most interesting ideas to spring from the Kunath-table discussions was one of the last. It was the suit he filed in July of 2017, a few months before his cancer emerged, challenging the Seattle City Council's plan to impose an income tax on Seattle residents.
 
Kunath, known as a political moderate, was incensed at a City Council that openly, and proudly, touted the measure before cheering supporters as an effort to "tax the rich." For days, his anger at a council that had departed so far from the moderate council members and mayors of old was on display to all who visited the table. Then came the lawsuit idea.
 
Filing suit against the tax was discussed and framed in table discussions for a couple of weeks, with it being important to Kunath that his suit is the first filed (eventually two other suits were filed against the City) because he was typically certain his arguments would be more persuasive before the court.  
 
Juarez Kunath BledsoeJuarez, Kunath, BledsoeKunath's suit was filed by his attorney, Matt Davis, minutes after then-Mayor Ed Murray signed the tax into law following City Council passage. By lottery, it was the suit first destined to be heard before King County Superior Court Judge John R. Ruhl in November, but the City Council decided to withdraw the income tax plan before Judge Ruhl could hear the case and rule on it.
 
While the suit over the city income tax was the most visible, it wasn't the most impactful of Kunath's involvements. The ones that likely fit that description of "impactful" came in the '80s.


First was the effort to turn the small leukemia support event called Celebrity Waiter into something significant.
 
His longtime friend, Mike Bledsoe, recalled in a conversation after Kunath's death, how he, Kunath and their mutual friend Gene Juarez, who was also a client of Kunath's, stepped in to turn the $12,000 fundraising lunch into what became the most successful Celebrity Waiters event in the country at about $500,000.
 
"We felt we could improve on the total amount raised and have a darn good time doing it," Bledsoe said. "The more zany things we could think up, the faster the event grew."
 
"I remember Kunath convincing me to travel with him to Vancouver B.C. a few years ago to convince a group of locals there that they should create, with our help, a sister group to the Seattle Celebrity Waiters group so we could have someone to compete with," Bledsoe added.
 
It was the same threesome of Kunath, Bledsoe, and Juarez who helped fulfill the dream of the founding of Heritage College on the Yakima Indian Reservation in Toppenish by Dr. Kathleen Ross, a Catholic nun of the Holy Names order.
 
Ross planned to launch a fully accredited four year College, Heritage College, in an abandoned old Schoolhouse with the dream of bringing quality education to the Native-American students in the region.
 
"It looked like a long shot to us and so it was too big of an idea to ignore." And thus with business advice and arm-twisting of contacts for a financial contribution, coupled with Ross' vision, what has emerged in Toppenish is Heritage University. It was the Hispanic youths who have come in large numbers to Heritage, which now has branch campuses at two-year colleges in the Tri=Cities and Yakima.  
 
Back to Kunath's table, which always sported a "reserved" sign throughout the day and which was, since Kunath always picked up the tab for wine there, a significant source of revenue for the hotel.  
 
Kunath and I were the same age, our birthdays a day apart so we inevitably found time for a toast to the fact we were still here and life had been good to us the previous year. But there was no toast to our 79th this past April. 
 
Kunath OFarrell HatchKunath, OFarrell, HatchAmong the most regular of attendees at the table, always serving as both table humorist and key Kunath advisor, was Ken Hatch, the retired 30-year chairman and CEO of KIRO Inc, who died in November of 2017.
 
An example that far more than wine was shared there was the comment from his longtime friend John Oppenheimer, founder and CEO of Columbia Hospitality, the Seattle-based hospitality management and consulting company.
 
"Kunath's table at The Fairmont was such a great place for all kinds of introductions," Oppenheimer recalled. "We met our Senior VP of Marketing, who has been with us for the last 10 years, thanks to Mike's table."
 
There was a time when conversations at tables cross the city shaped the future of the region, like the one on which a napkin drawing of a space needle provided a step toward what became Century 21, the Seattle World's Fair. And many of those conversations were at the same hotel, but more likely back in the day when it was the Olympic Hotel.
 
There likely will be a final gathering at, or more likely in the room surrounding the table. And Bledsoe predicts attendees will take turns sitting in the chair at the head of the table, sipping a glass of wine and leaning forward while looking at the crowd with a Kunath grin.

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Shabana Khan's squash events drawing more attention with a focus on youth

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Shabana Khan's rise to national and global prominence as the queen of promoters of the sport of squash has come with a few giant steps while her progress toward recognition in the local community that she has put on the international squash map is happening in small steps.

One of the reasons she has gained high regard from youthful squash players, their coaches and parents are the national College Showcase that she put on last week for nationally ranked students, 16 men and 16 women, aged 15 to 18, playing before coaches of the top schools where squash is a scholarship sport. It was the fourth annual Showcase event.
Shabana Khan and Yasmine

The fact the young competitors were all from Washington and California while the coaches eyeing prospective scholarship talent were from schools like Amherst, Middlebury, Vasser, George Washington, Bates, and Brown points up the difference in focus on the sport on the East Coast and the West, including the Puget Sound area.

But another difference, one for which Khan deserves significant recognition, is the fact that similar tournaments on the East Coast cost the young competitors, or rather their supportive parents, between $3,000 and $5,000 to participate in one of the four-day events while the students competing here pay nothing.

Part of Khan's stated goal is bringing an awareness of squash to young people of all backgrounds rather than merely the children of the squash affluent, whose demographics are men and women, both players and fans, with median incomes of more than $300,000 and an average net worth of nearly $1,500,000.

A quest for awareness for youth squash is exemplified by her thus-far unsuccessful effort to convince the City of Bellevue that there should be a park for squash courts so that, as she puts it, "kids of ordinary means can learn to play without having to have their parents be members of a club."

In fact, as the mother of aspiring youth squash star, 13-year-old Yasmine, she knows the challenges of youth-squash competition.  

Readers of The Harp will recognize that I've written about Khan before. Beginning when she brought the Men's World Squash Championship to Bellevue, the first time (ever) in the U.S. The reason is because of a conviction that what she is seeking to do for Bellevue and its young people in particular merits far more attention than she is getting.

A couple of significant developments for Khan and her squash initiatives await in the coming months. One brings particular pleasure to the now 50-year-old former national women's squash champion.

That's the fact that her world invitational squash tournament in August for top squash talent, six women and six men, will be an event whose sponsors have decided to name the event, the only one of its kind in the country, after her late father. There are no other squash events in the country like it.

Yusuf Khan, who brought the sport of squash to Seattle from his native India a half-century ago and, as one of the world's top squash professionals, proceeded to bring Seattle to the attention of the national and international squash establishments and see two of his daughters become women's national champions, died last October at the age of 87.

The invitational event that will be held August 25-30 at the Hidden Valley Boys & Girls club in Bellevue will be named "PMI Dave Cutler Presents The Yusuf Khan Invitational."

The "PMI Dave Cutler" portion of the title is for the two men, both internationally known in their respective professions, who have become the financial support for YSK Events, the little non-profit through which Khan carries out her squash events.

One is Dave Cutler of Microsoft, universally acclaimed as the key technical brain behind the Microsoft Windows NT and all the subsequent windows versions. A decade ago he was recognized as a National Medal of Technology and Innovation laureate, perhaps the most prestigious honor in the country for developers of new technology.

The other is Robert Harris, founder, and CEO of PMI-Worldwide, a Seattle-based brand, and product-marketing company with offices in seven cities around the world whose corporate philanthropy has only recently begun to be recognized.

The two have come to team up for a $150,000 donation that for the past several years has allowed Khan to put up the prize money, which this year will total $300,000.

"Every player participating is ranked inside the top 10 in the world," Khan noted. 'The only one, not world ranked is our local player, Reeham Sedky, who has just recently begun her professional career."

I got to write about Sedky, though sadly it was her only local visibility, after the then 21-year-old who was born and raised in Bellevue and became the nation's best women's high school squash player as a student at Forest Ridge, upset one of the world's top women at last year's Invitational.

Sedky has begun her squash pro career after graduating from the University of Pennsylvania where she was women's national squash champion.

The fact that her father is Egyptian works for Amazon and played squash, is an example of the role the growing international diversity of the Puget Sound region can play in bringing squash, among the top sports in many countries, into greater prominence among activities for young people.

It's particularly appropriate that the PMI Dave Cutler event will be named this year for Yusuf Khan since it was 20 years ago that he and Shabana teamed to bring to Seattle the first women's world squash championship ever held in the United States.

Khan is adding a fun factor to the invitational event this year in the form of a tech company tournament that she explains will be called the Tech Challenge and will involve 12 teams, with four from Microsoft already committed. Each team of top squash players from their companies will put up $5,000 to compete.

"We need about $110,000 from the 'Tech Challenge' to fill out our $300,000 prize money," Khan said.

And a few weeks after the invitational event, Khan's plan for a new series of western youth squash tournaments called West Coast Squash will debut as a competitive Junior Squash series involving teams from Vancouver, Portland, San Jose, San Francisco, and the Los Angeles area. She said Orange County, "which has an excellent squash facility," could be added.

In the face of an apparent lack of interest, from the Eastside establishment, in what Shabana is doing for the image of the area in the global squash community and the many countries where squash is a top sport. I was struck by the answer that Harris gave me last year when I asked why he was such a strong supporter of Khan. It bears repeating here.

"It's pretty simple. In a world beginning to look inward rather than building international alliances and global partnerships, I believe it's increasingly important to support sports that are global in nature and connect people from around the world. This is the only way humanity, and our planet are going to survive and prosper."

It's a comment that leaders of the business and civic communities that have "other causes" than Shabana's might ponder.

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Trade pacts should be about economics, not politics - Frmr Congressman Bonker

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Donald Bonker, one of this state's most respected experts on international trade across the past half dozen presidential administrations, suggests that when trade agreements become more about politics than economics, the stability of economies comes to be at risk.

In focusing on the current trade crisis with China, Bonker, a former seven-term Democratic congressman from Washington's Third District, suggests that "China has a historical and long-term perspective that is lacking in America. 

Donald BonkerDonald Bonker"They have a five-year economic plan that enjoys strong support while America has presidential elections every four years, with incoming presidents often reversing the course of their predecessors," he said.

Bonker's trade credentials, both those he earned during his 14 years in Congress from 1974 to 1988 and from his involvements thereafter, have gained him broad respect in this country and abroad for his trade and foreign investment knowledge.

He was a senior member of the House Foreign Affairs Committee and chairman of the Subcommittee on International Economic Policy and Trade. Bonker served on the president's Export Council and headed former House Speaker Tip O'Neill's Trade Task Force, which led to the passage of the 1988 Omnibus Trade Act.  

I knew Bonker well when we were both in our early 30s, he as innovative auditor of Clark County, laying the groundwork for an intended but unsuccessful run for secretary of state, and I as a UPI political writer in Olympia. And later, after his first unsuccessful run for the U.S. Senate, I had him write a regular trade-issues column for Puget Sound Business Journal.

In fact, I have had fun telling friends occasionally that after he left Congress, at one of our meetings, he gave me a photo of us that had been taken at a 1968 political fundraiser for Sen.Martin Durkan and that had hung on his wall during his years in Congress. After sharing the story, I then add that the reason it had hung on his wall was because of the other person in the photo, then-Sen. Birch Bayh of Indiana, one of his heroes.

Bonker, 82, travels back and forth regularly from his Bainbridge Island home to Washington, D.C., where he is an executive director and on the international advisory council of APCO Worldwide, global public affairs & strategic communications consultancy.

We hadn't visited for years when I suggested recently that we have lunch so I could learn about his newly published autobiography called Dancing to the Capitol, which begins with what the foreword describes as "a wry take on his brief stint as a dance instructor, which gives the book its title and its spirit."

The foreword, by former Los Angeles Times editor Shelby Coffey who is now vice chairman of the Nuseum, describes Bonker as "a man of faith--often struggling with being both a Democrat and a Christian," and noting that Bonker helped bring the National prayer breakfast to international prominence.

"He has been a key, if quiet, force for others of faith who contend in public life," Coffey wrote.

In fact, our luncheon discussion quickly turned from his autobiography to the issue of trade and politics. Bonker would like to see Democrats turn trade discussions away from the punitive to the progressive, meaning they should focus on building the opportunity for exports that could create jobs rather than be focused on trade barriers in the hope that approach can retain jobs.

During his tenure in Congress, Bonker authored and was a principal sponsor of significant trade legislation, the Export Trading Company Act and the Export Administration Act.

"The trade issues are very difficult for Democrats," Bonker said. "In their hearts they are global but labor has become so against trade that Democrats are left in a difficult political position."

"We should match what our competitors -- Japan, China, Germany - have been doing for years. They have ambitious government programs that give their exporters an advantage in this increasingly competitive global economy," Bonker suggested. "The U S., by comparison, is so preoccupied with limiting imports that there is little or no attention given to boosting exports. That is the real problem."
My alternative would be to export more, not import less," Bonker said.

"One example is the Export-Import Bank, which provides essential financial guarantees that allow U.S. corporations to compete with their competitors (Boeing versus Airbus)," he added.  

"This respected financial entity remains idle now, even though it does not require Federal funding," Bonker said. "Meanwhile, across America, there are about 50,000 domestic companies that are competitive but have difficulty pursuing foreign markets because the help that should be there isn't."

Bonker offered a bit of history on the political back and forth that has characterized this country's trade positions, starting with the passage in 1928 of the Smoot-Hawley Tariff Act that hiked tariffs, often up 100 percent, on 20,000 foreign imports.

"That prompted our allies and dozens of other countries to retaliate, causing the collapse of the world trading system that led to the Great Depression," Bonker said.

"Hoover was booted out, replaced by FDR, who championed pro-trade policies to repair the damage to international trade," he added. "Again, the political dynamic changed around the 1960s-70s, where Democrats, driven by labor unions, started to embrace protectionist policies, and Ronald Reagan arrived to champion free trade.  

"Trump's campaign rhetoric and subsequent actions are more in sync with Democrats and Bernie Sanders," Bonker added, with a jab at both. "Republicans are puzzled and frustrated.  It is contrary to their fundamental beliefs, alignment with their business support base."

As to the China trade concern, Bonker said: "whether China will retaliate to the latest round of tariff threats remains to be seen, but in long term, you don't mess with China, even if your name is Donald Trump."

Bonker, who specializes in Chinese investment in the United States, offers a criticism of both houses of Congress for their reactions to the Administration's tariff initiatives, saying"Senate Republicans remain muted and House Democrats discretely like what the President is doing, adding, "if we continue down this path of protectionism, it will be a repeat of Smoot Hawley."

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Genome sequencing Spiral Genetics and its young CEO prepare for fund-raising round

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Having reacquired Spiral Genetics, the genome sequencing company she co-founded fresh out of college a decade ago, Adina Mangubat has taken a couple of key steps to pave the way for a fund-raising effort she intends will move the company onto the global stage in the rapidly emerging DNA testing field.

Adina Mangubat Adina Mangubat To refer to Mangubat as a seasoned and tested CEO at the age of 32 might be a surprising description to those unaware of the path she's taken for the company she launched at age 22, fresh out of the University of Washington.  
Adina Mangubat 

But it's an apt description, given her process over the past couple of years. Or maybe more accurately the last couple of months. Two years ago she guided her company into a merger with a Bay Area bioinformatics company, then a few weeks ago did what she describes as an "un-acquisition" that paved the way for putting together a partnership with Microsoft that will dramatically expand Spiral Genetics' impact, internationally as well as nationally.

Closing the Microsoft partnership, the goal for which is to train algorithms to predict which people may be at risk of cardiovascular problems later in life," followed Adina's participation, along with her team, in Silicon Valley's Y Combinator, which she describes as "the number one start-up accelerator in the world."   

The fund-raising effort soon to get underway will permit Mangubat to scale up a broader international presence for her company as dozens of countries are undertaking large-scale genome sequencing of their populations. The company's first raise was a $3 million venture-led series A round in 2012.  

"This creates a unique opportunity to be able to find correlations between people's genomes and their medical history, which will lead to the discoveries that massively impact drug development and disease diagnosis in the future," Mangubat says of the growing effort to sequence the genomes of large populations.

"Ultimately, comparing genomes at scale will power novel discoveries that lead to new diagnostics and drug discovery," she added during an interview.

I asked Mangubat to give a layman an understanding of what widespread genome sequencing could bring about.

"DNA is life's chemical alphabet and if we could read and decipher what our DNA says and does, it would be a massive leap in our understanding of how to help our bodies overcome disease," she explained.

"The first step to read DNA is sequencing, which turns this chemical signal into a digital alphabet. The technology to read all 3 Billion letters of each person's DNA fast at not a lot of cost," she added. "The next challenge is figuring out which combinations of letters do what. Today, less than 1 percent of the function of genetic variations in humans are understood."

"Spiral Genetics has built tools for comparing large groups of people's DNA against each other to help decode the mystery," she said. 

In reference to the new fundraising, Mangubat said: "The pitch is that we make large scale genomic data mining possible.  There is a unique thing happening in history where we have reached a point of critical mass for sequencing. 

"To date, the globe has sequenced 1.5 million people's whole genomes.  And now there are 50 countries that are doing large scale sequencing of their populations to optimize their healthcare systems," she said.

"With just those groups alone, they have committed to sequencing 20 million people over the next five years and this creates a unique opportunity to be able to find correlations between people's genomes and their medical history," she said.   

"That will lead to the discoveries that massively impact drug development and disease diagnosis in the future.  Existing tools are not built to handle this scale of data.  We are making it possible to mine through this data to find the answers we've all been looking for."

With a successful raise, we are going to scale up multiple countries we are working with,' said. Spiral Genetics has been working on small projects with four countries but will look to dramatically scale up its genome work with two of those will the additional funds

With a father who was a doctor and a mother who ran the business details of the practice, Mangubat was exposed to medicine from her earliest years.

But her degree was in psychology and her exposure to the idea of genome and DNA came from a classmate in the entrepreneurship program at UW, who co-founded the company with Mangubat and remained for a time as a partner with Mangubat in growing the company in its early years, 
 
I couldn't help but wonder what kind of challenges she had to overcome in starting a company as complex as Spiral Genetics as a kid just of out college.

"The toughest challenge is not the lack of experience but the lack of network," she quickly noted. "Experience can be supplemented when needed and (in some cases) experience can be detrimental as one can have pre-existing ideas about what is or is not possible."

"But the power of a strong network makes such a massive difference for doing anything, whether it's fundraising, recruiting, connecting with potential customers, finding a good lawyer, etc. ," she said. "At 22, I had a very small network to pull from and after 10 years of actively building relationships, it's a completely different game."

Development of her network was undoubtedly enhanced pretty dramatically when she was named a Forbes Magazine 30 Under 30 For Science and Healthcare seven years ago at the age of in 2013 and in 2017 a Forbes All-Star Alum for 30 Under 30s.

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The reason that WA is unlikely to have a state capital gains tax - this session

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Disagreement between Washington's Democratic House of Representatives and the Democratic Senate over a proposed capital gains tax will likely keep the tax from being included in the state's operating budget for next biennium.

And that could be well for both those for whom the lawmakers should be seeking to provide opportunity and for the wealthy that many legislators would merely like to squeeze.

With Sunday's sine die adjournment of the 2019 Legislature's regular session looming, there appears virtually no likelihood that the two houses can resolve their differences over the most controversial piece of the tax increases they seek to impose.

There is obvious business pushback over any new taxes the lawmakers might pass in an economic environment in which state forecasts of surging new revenue already provide the lawmakers with $5.6 billion more to spend in the coming biennium without new taxes.

And the protests over a possible capital gains tax provision is the most logical for business to oppose, particularly now because of the impact an ill-thought-out version of such a tax could have on the opportunity for future job creation.

The "opportunity" I'm referring to is the Qualified Opportunity Zones created by the Tax Cuts and Jobs Act of 2017 with those zones basically being census tracts designated by the governors of each state where development could occur and where those putting up the funds to seize those opportunities would get capital gains reduction or deferral.

Gov. Jay Inslee, with the help of Lt. Gov. Cyrus Habib, was an early and enthusiastic advocate for picking census tracts that could best serve the goal of supporting the economic opportunities and creating jobs in less well to do parts of the state. Each opportunity zone is selected from the state's census tracts.

So it would seem that if Inslee thought through what's at stake in imposing a capital gains tax now, he would be saying "don't pass that now." But some would suggest urging Inslee to "think it through" might be an issue in itself.

Over the past year, professional firms and wealth management companies have been promoting their OZ expertise to clients and prospects while states have begun to compete to lure investors to projects coming about or envisioned on their lands where the benefits of the new federal tax law could come into existence.

A key issue, beyond the fact that all states that impose a capital gains tax acknowledge that it is a tax on income and an income tax is unconstitutional in this state, is that states with a capital gains tax have moved or are moving to bring their state capital gains tax provisions into harmony with the new federal one.

Meanwhile, the IRS has been tinkering with the rules, issuing proposed changes several times in the past year and leaving uncertainty for those seeking to be early users of the tax advantage for projects ranging from hotels to manufacturing facilities.

The tax rates on capital gains range from California's 12.3 percent to North Dakota's 2.9 percent. Oregon's rate is 9.9 percent, above but similar to the 8.9 percent proposed for the Washington capital gains tax.

Most all of the states understand that failing to give a capital-gains break similar to what the federal tax law will provide is likely to put them behind the eight-ball in appealing to those seeking projects that will maximize their benefits.

And since the federal law will permit anyone anywhere owing tax on capital gains to invest those dollars in a project in any Opportunity Zone in the country, the example I share with people is the guy in Keokuk, IA, who needs to find an Opportunity Zone somewhere in which to invest his gains. He will go looking for a project he likes in Montana or Oregon or Washington, make his investment watch the tax-break dollars pile up.

If he's going to give up 10 percent of tax savings on his gain by investing a Washington zone rather than an equally interesting project in Montana, why would he do that?

Thus the importance of a state staying in the herd of states that are adding state tax breaks to the federal ones. But that takes planning and such planning isn't possible during what's left of this legislative session.

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Spokane Chiefs owner sees Seattle NHL team creating hockey family for Northwest cities

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Bobby Brett, the long-time owner of the major-junior hockey Spokane chiefs who is heading into the Western Hockey League finals this weekend, is convinced the advent of National Hockey League (NHL) play in Seattle come 2021 will create a family among the Northwest's local hockey teams.

Brett, part of professional baseball's best-known band of brothers who bought Spokane's class A short-season professional baseball team, the Indians, in 1985 and added the junior hockey team in 1990, says the yet-to-be-named Seattle NHL team "will be the region's team."

Bobby Brett Journal of Business photoBobby Brett
Journal of Business photo
"The time will come when players drafted by the Seattle NHL team will be assigned to one of the region's junior-league teams and develop a following and then wind up being called up to Seattle, and people will follow the deeds in the NHL with a 'that's our guy," Brett predicted.


Brett uses the easy example of Tyler Johnson, a local Spokane kid when he was drafted by the Chiefs in 2005 at the age of 15. Three years later he began a three-year starring role with his hometown team before he was drafted by the Tampa Bay Lightning in 2011. In his 2014-15 rookie season where he was named to the NHL All-Rookie team.

Had a Seattle NHL team been around and been the team to draft Johnson and help him move to stardom, he would have been the embodiment of every teen-age hockey hopefuls dream and his fans firm fans of Seattle's NHL team.

This column was meant to be about Brett's more than three decades of ownership of the Spokane Indians, which the Brett brothers bought after a seven-city search for a minor league baseball team they would buy. They bought the team for less than $150,000 and grew it into what has been described as "a gold standard of minor league ball" in its value today.

As we sat down in the office of our mutual friend, Spokane angel-investment leader John Pariseau for an interview this week, it was meant to be focused on baseball. But Brett's hockey team and its performance and its role in Spokane sports since Brett bought the team in 1990 drew my attention.

The Chiefs begin their best-of-seven WHL Western Conference championship series against the Vancouver Giants this weekend.

Bobby and his brothers have been about baseball their whole lives. Ken, drafted by the Boston Red Sox in 1966, was an athletic phenomenon, equally gifted as a hitter or a pitcher. And while he wound up as a journeyman pitcher playing for 10 teams, several teams had considered drafting him as a left-handed center fielder.  

Ken, who was a co-owner with his brothers when they finally settled on Spokane, died of a brain tumor in 2003.

Younger brother George played 21 years for the Kansas City Royals as a perennial American League All-Star who was eventually named to baseball's Hall of Fame.

Bobby played in the minor leagues in Billings and San Jose before deciding he could make more money in business, building and owning apartments in Southern California.

Of the brothers' search for a baseball team to buy, Bobby explained the process: "I'd looked at seven cities, and Spokane just happened to be my seventh stop. With the first six places I visited, the town wasn't right or the ballpark wasn't right or something wasn't right. So I was very discouraged."  

"I landed in Spokane. We wanted to buy a team, and this was the place I liked. There was a real airport, a real downtown with a beautiful downtown park," He told an interviewer a few years ago. "I went out to the baseball park, and it was all run down, but I thought, geez, you just need a little paint, a little of this and that. So, Spokane was the one we bought."

And Bobbie, with the support of his brothers, quickly created a winner with the Indians winning the Northwest League title in four consecutive years from '87 to '90 and winning four more titles since then.

Although Bobby was involved in the Spokane community from the moment the Bretts bought the team (they also own the Class-A Rancho Cucamonga Quakes in California and the Tri-City Dust Devils, also of the Northwest League), Bobby remained an absentee owner, visiting maybe four times a year.

But that changed with the purchase of the Chiefs.

"I had gotten married in 1988 and we had a kid a year later," Brett explained. "We lived in Manhattan Beach, which is a great area to live in if you're single or married with no kids. But it's hard to raise a kid with all the stuff that happens at the beaches in California."

"I thought, if we buy the hockey team, maybe I'll move up there for six months and get it off the ground and see how I like it," Bobbie explained. Six months has turned into nearly 30 years.  

He's become more than a sports-teams owner.
Major junior hockey, for those not familiar with it, becomes not just a community thing but a family affair. And that's part of his community commitment.

"We draft the kids when they are 15 and they can play on our team at 16 and continue until they are 20 so some kids are with us for four years," Brett explained, noting that the team helps find homes for the kids to stay in and families to live with and makes sure they become part of their high school environment.  

"Fully 70 percent of the players in the NHL came from major-junior hockey." Brett said.

There are 60 cities in three leagues of the Canadian Hockey League with the four Northwest cities of Seattle, Everett, Portland and Spokane part of the Western Hockey League.

His involvement in real estate since he was in his mid-20's and has continued into today is a focus that has also benefited Spokane.  

As one Spokane business leader explained to me: "Bobby is a master preservation person."
When I asked Brett about that, he explained: "We own 13 or 14 buildings downtown, older properties in need of renovation for which we got property-tax abatement.

So in some respects, it might be said that Brett is not only at work building Spokane's sports future but with real estate investment expertise, helping preserve its past.

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Port of Seattle plan, Department of Commerce Spain agreement key step toward Land of OZ

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Lisa BrownLisa Brown

As states begin to compete to create the most attractive Land of OZ to lure investors and create new businesses and jobs, the state of Washington and the Port of Seattle have taken key steps in the past few weeks that could put them at the front of the pack employing the benefits of new federal tax law.
 
OZ refers to what is officially called Qualified Opportunity Zones that come about under the Tax Cuts and Jobs Act of 2017. The QOZ provision in the legislation approved by Congress will permit those owing capital gains tax to delay, reduce or even totally avoid those taxes by investing in special funds designed to start businesses and provide other steps to help economically distressed communities.
 
Virtually every major accounting or law firm or wealth management company in the country has been inviting clients and prospects to learn all about the details of what have become known simply as Opportunity Zones, or OZ.
 
And while the message in many of those explanatory sessions by professional firms has been the prospect to create funds for investment in real estate projects, funds could be particularly appropriate for energizing the prosperity of small and diverse firms that have not had access to equity capital to grow and expand.
 
And that's where the recent separate initiatives by the State Department of Commerce and the Port of Seattle come into play in a manner that gives this region a leg up in that competition among states for attracting new investment to job creation.
 
Ralph Ibarra 
The development for the state was Spain's first-ever Memorandum of Understanding with a state to promote economic cooperation to benefit trade relations and boost business opportunities for small and medium-sized businesses in both Spain and Washington State.  
 
The agreement was signed in Madrid March 1 between Lisa Brown, the new director of the state Department of Commerce, and Maria Pena Matcos, chief executive officer of the public agency attached to Spain's Ministry of Industry.
 
The Port of Seattle's initiative was issuing a "Request for Qualifications" for a $200 million renovation of 29 acres near Pioneer Square in Seattle to provide for the port's fourth cruise ship berth that would accommodate super-size cruise ships.  
 
That parcel, for which the Port is seeking a partner, is located within an Opportunity Zone that extends across the property on which T-Mobile Stadium and CenturyLink Field are located and extends into the International District.
 
The Port's Request for Qualifications intriguingly contains the sentence: "It should be noted that Terminal 46 is located within a Qualified Opportunity Zone," suggesting it intends to use the tax-break incentive in seeking to attract a wide array of businesses to develop on the site, or nearby.
 
So what kind of developments are being created in other regions with Opportunity Zone funds? A potentially appropriate example was the announcement by a Scottsdale, AZ, based wealth development company called Caliber of plans for a new hotel development at Tucson Convention Center, which is in a designated OZ.
 
For Ralph Ibarra, president of DiverseAmerica Network, the agreement with Spain and the Port's announcement represent important steps to dramatically benefit small and diverse businesses.    

Ralph IbarraTo Ibarra, a consultant to the public and private-sector corporations and institutions who has brought long-standing support of small and diverse business to his consulting activities,
the agreement with Spain and the Port's announcement represent important steps to benefit small and diverse businesses.  

He sees both developments as important steps"particularly appropriate for energizing the prosperity of small and diverse firms that have not had access to equity capital to grow and expand."

In fact, Commerce Director Brown said her immediate priorities include helping address the sustainability of infrastructure financing programs and enhancing the agency's outreach activities - especially with rural and underserved areas - to ensure communities in need can access Commerce programs and services.
 
The statement put out following the signing of the agreement noted that it 'builds on a foundation of approximately $9 billion in trade activities currently taking place between Spain and the State of Washington. It acknowledges common strengths in aerospace, information and communication technology, cybersecurity, clean energy technology, life sciences, maritime, agriculture, and other sectors, and formalizes plans to explore opportunities for Washington companies in the Spanish market and establish future opportunities for Spanish companies to create jobs in Washington."

Ibarra, who chairs the Washington District Export Council, suggests Opportunity Zones "hold great promise to accentuate and expedite beneficial outcomes" from the Agreement with opportunities for Washington companies in the Spanish market and for Spanish companies to create jobs in Washington.

Ibarra brings some awareness of the extent of potential represented by the state's agreement with Spain since some years ago he prepared and escorted an aerospace manufacturing firm from this state to various meetings with Spanish aerospace companies at a U.S.-Spain Aerospace Industry Summit.

"And now, whether its Spain or Washington State, any individual relationship that comes about is going to need some sort of facility, whether distribution or manufacturing, in place and that's where Opportunity Zones can come into play to facilitate those relationships," Ibarra said.
 
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Recalling eastside business journal's impact - 20 years on from launch

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A LinkedIn entry from my son, Michael, noting the 20th anniversary of the launch of 
eastside business journal brought back memories of the effort to create the "local" business voice for Bellevue and other Eastside communities as they were starting to emerge as economic entities more independent from Seattle.

Eastside Business JournalEastside Business JournalMy decision, as publisher of Puget Sound Business Journal, to create a separate weekly business publication with its own staff, readership and highly focused coverage of business on the Eastside, as well as involvement with its business community, was a realization that a Seattle-based and focused publication couldn't build close relationships east of the lake.

Michael was an experienced young public relations and marketing professional when I convinced him to leave the public relations firm, The Fearey Group, to become general manager and overseer of a weekly start-up business newspaper.  

Microsoft was already more than a decade along in turning out young millionaires with its stock, as well as new software and computer products from its Eastside headquarters, and in fact, that year spun out its Expedia division into a separate Bellevue-based public company.

And the Eastside had become the global mecca for the rapidly growing telecom and cellular industry as home to not just McCaw Cellular and Nextel but also Western Wireless, which in 1999 spun off its star telecom subsidiary, VoiceStream, which has since become T-Mobile.

Willows Road, along with the west side of the Redmond Valley, had actually become the region's high-tech highway more than a decade earlier with a number of companies like Physio-Control and Rocket Research building their headquarters along the west hillside above Willows Road.

And of course, Kemper Freeman had already, for a couple of decades, been scaling the retailers' mountain and reigned as the most prominent retailer developer in the region.  

By 1999 he was on the way to creating a retailing center that would make his Bellevue Collection of Hotels, retailers, and restaurants leap past Seattle as a destination for shoppers and diners.

Of course, the EBJ launch came two years after Amazon's IPO changed the nature of Seattle's ability to compete with the tech growth on the Eastside, and soon surpass all in growth of revenue, profits and employment. Of course, now Amazon seems intent on possibly turning the Eastside into a second headquarters now that New York has been jettisoned.

Thus 1999 was an interesting time to seek to create a successful and impactful special-interest (business) publication in Bellevue and the Eastside, a time when two Seattle daily newspapers, The Times and Seattle P-I, made life difficult for the much smaller and profit-stretched Eastside Journal in the quest for readers and dollars from the Eastside.

So I told Michael to come up with some events that EBJ could put on to attract visibility and support and promised to make sure PSBJ didn't do the events as a counter to keep EBJ from gaining a foothold, which interestingly PSBJ adverting and editorial leadership hoped to do. It was a competitor, after all.  

Thus I took the unusual business role of holding the big dog back so the puppy had a chance to grow.

For a newly minted young newspaper executive with a twenty-something staff and seeking to carve out readers and advertisers from a young, partly tech, audience, the logical event for Michael to create was one honoring youth.

So he launched Eastside 40-Under-40, geographically designated even though there was no other 40-Under-40 event in the Northwest. In fact, I don't think there was one on the West Coast at that time.

That eventually became the regional event run by PSBJ, with the "Eastside" dropped from the 40-Under-40 name.

One day in summer of 1999, I wandered over to Bellevue from my PSBJ office to check in and found folks on the staff en route to a day-long Going Public seminar that attracted a large audience of entrepreneurs, prospective investors and wealth managers to listen and learn from a panel of experts Michael had assembled.

Then Michael came up with a CEO interview breakfast event he dubbed Eastside Executive Forum, with his first interviewee being the region's then Beer Master, Paul Shipman, creator of Redhook.

Another CEO interview featured HomeGrocer.com CEO, Terry Drayton. Do you remember that Bellevue based company that sprang into existence with the first fully integrated Internet grocery that grew across the West and across the south before being forced by tight cash for growth to sell out in the fall of 2000 to competitor Webvan?

It wasn't long before the reality of having created a direct and growing competitor in basically the same market began to sink in for the parent company and EBJ and its staff were folded into PSBJ. Michael soon departed the media business to focus on a business-development career in other industries.

And with the demise of the P-I and the closing of the Eastside's daily newspaper, by then renamed the King County Journal, in 2006, and the recent dramatic cutbacks by profit-focused Sound Publishing as owner of the area's shrinking pool of weekly newspapers, memories of the local business newspaper that was have been stirred anew.

"A lifetime ago and yet there isn't a day I'm not reminded of something I learned in those years," Michael wrote in his LinkedIn message. "Thanks, Pop and EBJ Peeps."

The LinkedIn message got several thousand views and many comments, including this from the head of an Eastside wealth management firm.

"Michael: you and your team's work had a huge impact on the Eastside at a critical juncture of growth along every path - business, economic, community, stature, maturity, and poise. I miss the voice of EBJ. I relish my fond memories of all of your events and the friendships forged over robust dialogue."

 
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Biotech veteran Rhonda Rhyne guides growing & innovative cardio-diagnostic company

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Rhonda Rhyne, whose leadership as president of an innovative cardiovascular medical device company made her one of the most honored biotech CEOs in San Diego for over a decade until she guided the sale of the publicly traded company, may be headed for a repeat performance, this one on Seattle's Eastside.
 
Rhyne is now CEO, president, and director of Prevencio Inc., a Kirkland company that has developed a test that is purported to be "significantly more accurate than stress treadmills for diagnosing obstructive coronary artery disease." She has guided the company since August of 2013, a few months after its conversion to a C corporation.
 
Rhonda RhyneRhonda RhyneRhyne's San Diego honors over 12 years at the helm of publicly traded CardioDynamics included the 2003 Entrepreneur of the Year award for medical products and Deloitte's Fast 50 Award for 50 Fastest Growing Tech/Life Science Companies in Southern California for nine consecutive years from 1999 to 2007. It was exactly a decade ago that she led CardioDynamics into a sale to Bothell-based SonoSite at a 69 percent premium.
 
This past year was one of the significant developments for Prevencio, with major presentations on its series of cardio-related tests in which Prevencio's focus has been on demonstrating improved diagnostic accuracy and helping keep patients from undergoing unnecessary, expensive, and invasive tests.
 
This year is a key one for the company as Rhyne has just returned from major presentations at a Biocom event in San Diego where Rhyne says she had an opportunity to advance discussions with potential partners and to "educate the biotech, medical device and venture capital worlds on what Prevencio is doing to advance cardiac medicine."
 
Now she heads to New Orleans late this week for sessions at the American College of Cardiology where researchers from Europe and from a major U.S. healthcare system will present accuracy studies which she says "further validate the robustness of our AI-driven, multi-protein novel HART blood tests." HART is the company's trademarked name for Heart-related ARtificial Intelligence-driven, multiprotein Tests.
 
The studies, Rhyne says, 'help drive awareness and adoption, partnerships, and eventual exit."
 
In the short term, the American College of Cardiology sessions will pave the way for the company's next fund-raising round in April when its B-1 round of $7-$9 million, which will include conversion of a $4 million note that is part of Prevencio's total to-date $11 million funding, is planned.
 
Prevencio's product explanation is complex to the layman. But Rhyne explains the company "utilizes Machine Learning (Artificial Intelligence) plus Multi-Proteomic Biomarkers plus Proprietary Algorithms to deliver cardiovascular diagnostic and prognostic tests that are significantly more accurate than standard-of-care stress tests, individual biomarkers, genetic markers, and clinical risk scores."
 
Study results announced last year, including by the European Society of Cardiology, credit Prevencio's diagnostic testing with producing promising results for an array of cardio-related diseases, including those relating to kidney disease and to peripheral artery disease (PAD) in diabetes mellitis.
 
The company's lone competitor for diagnosing coronary artery disease was a Stanford spinout whose lab tests had what Rhyne describes as "significant limitations" that led to Medicare canceling coverage late last year and thus the company went out of business after raising and spending more than $300 million.
 
"Our plans for partnering with other companies for licensing and commercialization will keep our burn rates low and facilitate partnerships, widespread dissemination, and exit," Rhyne said.
 
Rhyne's introduction to the medical instruments industry and coronary testing came early in her career when, after quickly tiring of being a pharmacist, she went to work for Quinton Instrument Co., the Bothell-based company that was a pioneering innovator in medical devices.


The devices she sold for Quinton ranged from stress treadmills to cardiac diagnostic equipment.
 
So she sports a smile when she suggests that her company is positioned to replace the diagnostic treadmill systems that were the medical devices with which she started her career in that field more than 30 years ago.
 
I asked Rhonda, during one of our interviews, why she had returned to Seattle after establishing a dominant Biotech presence in San Diego.
 
"My husband was in Seattle so after 12 years of being a couple (met, dated, engaged, and married) and not living together I thought it was prudent for our relationship and marriage," she replied.

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Cuomo blasts critics who doomed Amazon deal - "...stupid or liars..."

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New York Gov Andrew Cuomo has laid to rest any doubt that the political fallout from Amazon's decision, in the face of loud but relatively small opposition, to abandon its plan to bring its HQ2 to New York will drift across the national Democratic party landscape heading toward the 2020 elections.'
 
An open letter released last Sunday on Cuomo's web page was written by New York State Budget Director Robert Mujica who basically derided those whose opposition led to Amazon's decision as either stupid or liars.
 
As Mujica ungently said of opponents of the project who claimed Amazon was getting $3 billion in government subsidies that could have been better spent on housing or transportation: "This is either a blatant untruth or fundamental ignorance of basic math by a group of elected officials."
 
Mujica, whose letter has become fodder for blog comments across the political and economic spectrums, said there were three reasons the Amazon deal fell apart.
 
"First, some labor unions attempted to exploit Amazon's New York entry. Second, some Queens politicians catered to minor but vocal local political forces in opposition to the Amazon government incentives as 'corporate welfare.' Third, in retrospect, the State and the City could have done more to communicate the facts of the project and more aggressively correct the distortions."
 
On the third point is where Mujica took opponents of the project to task for his charge of "blatant untruth or fundamental ignorance."  
 
He explained that "The city, through existing as-of-right tax credits, and the state through Excelsior Tax credits -- a program approved by the same legislators railing against it -- would provide up to $3 billion in tax relief IF Amazon created the 25,000-40,000 jobs and thus generated $27 billion in revenue."
 
The fallout from Coumo's withering criticism of Amazon critics, through Mujica's superbly crafted narrative, coupled with the emerging influence of newly elected congresswoman Alexandria Ocasio-Cortez, could make New York ground zero for a major rift among Democrats, and not just those in New York.
 
Those elected officials scorned by Cuomo through Mojika's commentary, included Ocasio-Cortez, who has gathered growing support from elected Democrats on the left as well as left-leaning groups around the country, particularly after she promised that candidates like her will be on the ballot in an array of locations next election.
 
I looked through a variety of political and economic blogs about the Amazon debacle and found several that made compelling reading.

But the one that I found most compelling, though politically partisan, was from an economics blog called Marginal Revolution done by a couple of economics professors at Gorge Mason University in Virginia.
 
"I can only think that this is some sort of cognitive dissonance that prevents people of a certain politics slant from mentally processing words that go against a deeply held stereotype," wrote the prof, Alex Tabarrok. "Amazon is big. Bezos is rich. Obviously then the state gave them unique benefits. That's the only message that the left wing brain is neurologically capable of hearing, even though, in this case, it is the opposite of what happened."
 
His comment made me think his "certain political slant" likely fits both political fringes and it was then I realized it's been exactly a decade since the modern-day Tea Party came into existence, in either February or April of 2009, depending on which event its fans took to be the launch.
 
There obviously isn't going to be a liberal Tea Party, even if "neurological incapacity" can be found far out on either fringe. But what's happening in New York in the Amazon aftermath makes it clear there could be a mirror image of the Tea Party with the mirror folks shouting "yes, taxes!" in reply to the "no on taxes!" Or "more government" to"no government."
 
That's the "balance" of equally potent fringes which, even if each appeals to about 15 percent of their parties, will be reflected in pressures on the middle as the next election nears.
 
And because the liberal "Tea Party" mirror is coming about a decade on from the original, it will be affecting political positions more than in the past for Democrats. And thus it will be interesting to see how the positions of Washington State's two presidential wanna be's, Gov. Jay Inslee among the Democrat hopefuls and Starbucks' Howard Schultz as an independent, might change.

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Amazon/New York - Are the days of corporate incentives or breaks coming to an end?

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Watching the free-for-all of analysis and commentary over Amazon's misadventure romance with New York City, we're talking about the company now, now its CEO, over a second headquarters made me think of my senior-sprinter friend and author Steve Robbins. Although he is acknowledged as the most prolific author of management textbooks, he may now have an outline for one he's never written.
 
I'm referring to Amazon's unprecedented suddenly announced decision that it was no longer planning to build a second headquarters in a section of New York City's Queens neighborhood of Long Island City.  
 
I say suddenly announced because no one can be certain that Amazon's decision to turn away from New York was as quickly made as the announcement might suggest. Like the world third's richest company may have begun to have a change of heart soon after its early November announcement that unexpectedly there would another "second headquarters", adding Northern Virginia in the announcement that New York was the pick.
 
Is it possible Amazon execs hadn't thought things through about New York until Gov. Andrew Cuomo and New York Mayor Bill de Blassio pointed out, as they welcomed the company, that New York is a union town? That fact had assumedly already been digested by a company that doesn't go for union organizing.
 
The business fallout from this may simmer for a time but will likely disappear. Bu the political fallout will likely continue for New Yorkers into the next general election and maybe beyond.

Meaning from a business sense, Amazon will likely be able to go on as if nothing happened. As a former top Amazon executive told me, "the world is a very big place. If one doesn't want us, others will."
 
But politically, the rift between the New York Democratic party power structure and the newly emerging powerhouse of left-wing forces, some elected and some not elected, will echo down the coming months.
 
I called my roommate from college days at Marquette, who retired after fashioning a prominent New York legal career, to ask him his thoughts.
 
"A lot of the politicians who were against the Amazon deal didn't represent the district so they had no skin in the game and Governor Cuomo is outraged at the politicians who had no constituent reason to get involved but screwed it up," he said.
 
"Regarding the idea that unions opposed Amazon, a non-union giant, coming to New York: that doesn't make sense," he said. "The municipal employees union was very opposed because they feared the multi-billion dollar package the city had put together for Amazon would come out of their salaries and future raises.
 
"But a majority of the unions are upset that Amazon walked away. Do you think any of the construction-related unions weren't excited about what the future held for them?"
 
The Amazon-New York situation represents the conundrum that areas seeking to attract new business face. If a city or state don't offer the incentives, they are often out of consideration.  If they do play the game, they are open to public pressure to back off.
 
A longtime business leader in this state, when I asked about that conundrum, told me he thinks the days of corporate incentives or breaks are coming to an end.
 
"This movement among millennials to the left is going to reset the political system, including things like corporate incentives," he said.
"The selection process was, in my judgment the height of corporate arrogance in a time when the tide is going the other way," added my business-leader friend.
 
"The variables which help strengthen public support for a company's actions are the goodwill a company builds in the community and the public support they build," he added. "Boeing has been a master at that, something they learned after the 1972 cutbacks from the demise of the SST."
 
So back to Steve Robbins and his management textbooks. I haven't seen Robbins, who moved from Seattle to Cleveland a few years ago and turned 76 last month, for a decade but was caused to recall his leaving me far behind in various 100-meter races in masters and senior games events. But fortunately, I got to talk with him after or over coffee about both writing and running.
 
I'd love to get hold of him now to get his view of the management aspects or lack thereof, that might have been in evidence in the non-dramatic drama of Amazon's decision.
 
I flipped through his nearly three dozen titles, of which he has sold 10 million copies and that have been translated into 20 languages, to see if any of the titles, all available on Amazon, might suggest he's already been there in the discussions and lessons in his management textbooks.
 
Robbins' books focus on conflict, power, organizational politics and interpersonal skills. Which of those were in evidence or absent, and to what extent, would make interesting cocktail lounge or boardroom, discussion.
 
I was intrigued at the title of one of Robbins' books: "Divide and Conquer: The ultimate guide for improving your decision making."
 
It occurred to me that the way Amazon left the New York political scene in taters definitely demonstrated an ability to divide, as was also evidenced in the embarrassing snafu of the Seattle City Council and its aborted head tax.
 
I'll leave the "conquer" to those cocktail lounge conversations.

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The Future Role Of Newspapers And To Whom It Really Matters

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A most interesting, and broadly important, corporate takeover battle is taking place in full national view but unfortunately, it's apparently attracting only modest attention from the general public, perhaps because of declining numbers of the public view the issue at stake as all that important.

That issue is the future of daily newspapers, framed against the hostile bid by Alden Global Capital, a New York hedge fund that has bought and then proceeded to suck the life from scores of newspapers in this country, to buy Gannett, owner of the country's largest newspaper chain.

If Alden's hostile takeover succeeds, the hedge fund's Digital First Media company would gain control of Gannett's 100-plus local newspapers as well as Gannett's flagship publication, USA Today. Digital First, which has a long record of stripping the staff and assets of newspapers, would become the largest newspaper chain in the country.

In the view of traditionalists, journalism, the kind that presumes investment in people and tools to deliver the kind of information that enables the informed public opinion that some of us believe democratic governance requires, would suffer another grievous blow at the hands of Digital First.

But the intriguing question is: does anyone other than those instilled with traditional journalistic mores, or moral compass, really care in an era of internet and social media and social network platforms that reach audiences with whatever information or messages they wish to receive or share. And there is coming to be an almost limitless number of those information alternatives, well beyond Facebook, Twitter, LinkedIn, and YouTube, each attracting not only customers but also ad revenue in increasingly clever and user-intrusive ways.
 
As far back as the turn of the last century, local daily newspapers were attracting ambitious men who wanted to own a lot of them. First, it was newspapermen like William Randolf Hearst and E.W. Scripps, and a small-town New York newspaper owner named Frank Gannett, who all had a personal zeal to expand their newspaper holdings as much for personal influence as for profit.

Soon companies that owned groups of newspapers, each of which could be expected to post profit margins approaching 50 percent, realized that as public companies they could return dramatic shareholders profits. Thus emerged newspaper companies like Knight-Ridder, McClatchy, Newhouse and Lee Newspapers and a host of smaller, lesser-known chains. And of course Gannett, the nation's largest.

But even the most committed newspaper groups, while pressing to maintain quality coverage for each of the communities they served, realized that delivering continually increasing profits required cost-cutting focus in all areas, not just logical ones like travel and meals and entertainment but also, inevitably, personnel.  

Then as daily newspapers began a long and slow but steady decline in circulation and advertising revenue, both the result of waning customer interest, newspaper acquisitions become appealing for far different reasons than the surging profits that once marked the industry.

So the sharks began to circle and there were a number who created profits by acquiring newspapers and imposing devastating cost constraints, which inevitably meant editorial staff reductions and thus the quality of the news coverage.

And Alden's Digital First found even greater investor appeal, realizing that after they bought a newspaper at a distressed price, they could not only reap the cash flow and lay off employees, but then sell the buildings the newspapers had owned. Thus disappeared or shrank dramatically dailies of onetime major prominence like the San Jose Mercury News, the Denver Post, the Orange County Register or the Oakland Tribune, which Alden merely closed.
At first, readers looked to television to provide news in a much more timely fashion than newspapers. Then social media platforms emerged to provide people with an outlet to feel like they could escape from the real world and interact with people who shared like minds and common interest on one of the web-based communities.   

Suddenly alternatives to conventional media like newspapers provided places to unplug from the grind of corporate America, family or whatever a person needed a break from, which was frequently the onslaught of information about wars, politics, disasters, or combinations of all three.

Meanwhile, most daily newspapers have fallen short in efforts to replace lost circulation and advertising revenue with revenue from digital news and product offerings. Though the device of luring readers to websites and then requiring a subscription in order to proceed beyond the first paragraph is benefitting those with higher-quality editorial offerings.  

So what of that conventional wisdom about the fate of newspapers holding the key to the health of democracy?  

Well, first those engaged in the demonizing of media for political reasons are having an active impact on the declining acceptance of newspapers. In addition, an article in Wired magazine last week included an article entitled "Journalism isn't dying. It's returning to its roots."

"If men like Ben Franklin or Samuel Adams, both newspapermen returned to today, they'd find our journalistic ecosystem, with its fact-checked-both-sides-ism and claims to 'objectivity' completely unrecognizable," suggested the Wired writer. Both founding fathers wrote under numerous pseudonyms and Franklin pioneered placing advertising nest to content.

"We take journalistic objectivity to be as natural and immutable as the stars, but it's a relatively short-lived artifact of 20th-century America," the Wired article continued. "Even now it's foreign to Europeans-cities such as London cultivate a rowdy passel of partisan scribblers who don't even pretend there's an impregnable wall between reportage and opinion."

The Wired article, written by Antonio García Martínez, who worked on Facebook's early monetization team where he headed its targeting efforts, suggests that "While the tone of journalism might be headed back to the 19th century, clearly the business models are not. Revenue-wise, the Great 21st Century Journalism Shakeout will likely end with smaller organizations inventing new business models that the villains-the internet and social media-enabled."
There's a local aspect to this column: it's the observation that this state benefits unusually from the number of local and family-owned daily newspapers operating here, compared to other states.  

But those newspapers in Spokane with the Spokesman-Review, Vancouver with the Columbian and Seattle with the Seattle Times, plus Yakima and Walla Walla that I also include as a local family owned since they are Seattle-Times owned, face dramatic financial challenges that do threaten their survival.

I also include the Lewiston Morning Tribune among the local, family-owned in this state because The Trib serves an audience across parts of Southeast Washington and the Palouse, through its Moscow-Pullman Daily News. And also because two of the stories about the community service that comes with local ownership relate to the late A.L. Alford and his son, A.L. "Butch" Alford Jr., former publisher, now president and chairman of TPC Holdings, an umbrella for the Tribune and Daily News. Butch succeeded his father upon his death in 1968 and passed the publisher Baton to his youngest son, in 2008.

Seems that years ago, The Trib was writing some stories critical of Potlatch, the then locally based lumber-products public company that was a major advertiser, when the CEO one day paid a call on publisher A.L. Alford Sr., and made it clear there would be no more Potlatch advertising in the Tribune unless the critical stories stopped. So the senior Alford, without further ado, asked his assistant to please show their guest to the door and the CEO, true to his word, stopped advertising and the critical stories continued.

A few years after he became publisher, Butch Alford was appointed to Idaho Board of Education and took the occasion to write a front-page column detailing his various business and community involvements and ties, explaining to readers that he felt it important that they be able to be aware if his newspaper's coverage seemed to be influenced at any time by his involvements and interests, so they could call him to account if it seemed appropriate.

Without offense to the journalistic stints of our founding fathers, I'd personally prefer that the future of newspapers was in the hands of those like the Alfords rather than Franklin. I only hope the future is not in the hands of Alden. Or Facebook's Mark Zuckerberg.
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WA legislature and Congress in crosshairs over consumer privacy

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Lawmakers in both Washingtons are in the consumer-privacy crosshairs amid a growing awareness, and thus anger, of how little people are able to keep private about themselves.  
 
While both the Washington Legislature and Congress are deliberating bills the lawmakers hope can be crafted to satisfy both tech giants and consumers, there is an increasingly uncomfortable sense among legislators at both the state and federal levels that they had better not rile consumers further on the privacy issue.
 
And interestingly, part of the script for how this struggle between the tech industry and individuals over privacy plays out may be written in Washington state, either with the legislative tax hammer that is almost uniquely available in this state or by an emerging Bellevue company that hopes to take the privacy issue out of the hands of the tech giants.  
 
The tax tool is the state's business and occupation tax, a use tax on gross receipts rather than profits, which can and has been imposed in a punitive manner. The business start-up company is Helm, which has created a relatively inexpensive device, about the size of a router, that lets consumers send and receive emails from their own domain. More on both the b&o and Helm later.
 
At the federal level, Sen. Ron Wyden, D-Ore., is proposing sweeping new legislation that would empower consumers to control their personal information, create radical transparency into how corporations use and share their data, and impose harsh fines, even prison terms for executives at corporations that misuse Americans' data.
 
As Wyden has put it: "Today's economy is a giant vacuum for your personal information - Everything you read, everywhere you go, everything you buy and everyone you talk to is sucked up in a corporation's database. But individual Americans know far too little about how their data is collected, how it's used and how it's shared,"  
 
Washington Gov. Jay Inslee said he expects the state legislature to address privacy in the upcoming session, saying he has begun discussions with tech leaders in the state "about a privacy policy that is consistent with innovation and also consistent with fundamental rights of privacy." And Inslee expressed confidence about getting a policy, probably in this session, that will be pleasing to innovators and consumers."
 
"Pleasing" to the big tech companies like Facebook, Google and hometown Amazon is an almost amusing word for a governor to use when "acceptable" to the tech giants is the best that is likely to happen with any state legislation that constrains the manner in which personal information is being collected and used.
 
That's particularly true with citizen pressure on lawmakers here and in other states after California's Assembly and Senate overwhelmingly passed a far-reaching piece of legislation called the California Consumer Privacy Act of 2018 (CCPA). The measure largely mirrors protections offered to European citizens under the recently implemented General Data Protection Regulation (GDPR), is likely to drastically change the ways that American companies store and trade in consumer information for Californians.
 
The law allows Californians to ask firms collecting and selling data: what do you collect, why and with whom do you share it? And it allows California residents to opt out of the sale of their data and to request deletion of their data.
 
And in addition to Wyden's zeal on behalf of privacy, the passage of CCPA is spurring the tech industry to seek Congressional action on something they could at least reluctantly accept to avoid what they are protesting as a possible "patchwork approach to privacy policy" if each state enacts its own version.
 
So in the event Washington lawmakers approve legislation that makes its citizens happy about new state protections for privacy, and then Congress approves a law that offers dramatically less protection that supersedes what states like California, and Washington, have put in place, how can this state preserve the protections it will have given its citizens.?
 
A suggestion, borne or my political-writing background: The state, led by its Democrat Atty. Gen. Bob Ferguson, could put in place a privacy policy that companies would be told they must comply with or a special B&O tax rate of some compelling amount, maybe even 25 percent, will apply to those firms not honoring our privacy policy.  
 
Would Ferguson have the courage to confront major tech companies either located here, like Amazon or having a significant presence here like Google and Facebook? Given the fact that he'd like to be Inslee successor as governor and that his key role is first and foremost "preserving the rights of the individual," he could fatally impact his political hopes if he failed to follow the public demands on this issue. And in fact, if he failed to take a protective step demanded by citizens, they could use the initiative process to create a special b&o tax rate themselves.
 
This wouldn't be a law, since the federal government if Congress passes a privacy act, would likely have pre-empted states passing laws governing privacy. But legislation imposing a different b&o tax and the significantly higher rate has a long tradition protected by decisions of the Washington State Supreme Court.
 
Would what I am talking about be legal blackmail? Consider that there are almost three dozen B&O classifications with rates often unexplainable, like parimutuel wagering having a rate of .0013 and gambling contests of chance, .015. The latter, incidentally, is the rate for "service and other activities," which includes professional firms like attorneys as well as consultants-the rate I pay.
 
And how law firms came to be taxed at the highest rate is instructive for how lawmakers in Washington can use the b&o. In the 1993 session, lawmakers sought to extend the sales tax to the legal profession but the attorneys brought their lobbyists to the fray and successfully defeated the effort. Presto, came the highest b&o tax suddenly applying to attorneys, just about tripling their tax.
 
I once asked the late Gov, Mike Lowry if that came about as punishment by a Democratic governor (him) and Democratic legislature and he let out one of his classic shoulder bouncing laughs.
 
When I discussed the privacy issue with Bellevue-based research analyst Jim Hebert, he noted that Congress has been through a major privacy-invasion crisis and solution before. He was referring to the reforms in consumer credit law to combat excesses of the credit agencies.  
 
"The agencies collected information on you, kept it and sold it to banks and others, with statistics disclosing that 40 percent of the information was wrong and no one knew it," Hebert said.  
 
The outcome was legislation enacted requiring that all such data the credit agencies collect is now turned over to a third-party organization that polices the data's accuracy and makes it available to consumers.
 
"Credit bureaus weren't put out of business or even really damaged by the corrective legislation," Hebert noted.
 
So back to Helm, the Bellevue company that was the idea of  Giri Sreenivas and Dirk Sigurdson, two entrepreneurs who had sold a security startup and raised a $4 million seed round from top venture capital firms last year.
 
"Right now, nearly all of the data that comprises your online life is stored in a massive data center," Sreenivas wrote in a blog he posted. "You don't own it. You can't see it, you can't touch it - and you don't know who can. That dream of a device that would make data 'ownable' to the individual - not a stranger - is what led to Helm."
 
Their device connects to a home network and pairs with a mobile app that lets users create their own domain name, passwords, and recovery keys. Helm supports standard protocols and works with regular email clients such as Outlook or the Mail app, with encryption protecting the connection between the device and the apps.
 
A key challenge for privacy champions is the apparent uncertainty about the extent to which younger generations will care enough to get into the fray as opponents of the big tech data collectors, although a recent survey I saw said there's growing disillusionment among people in their twenties and thirties surrounding social media.
 
But in a comment that leaders of the privacy battle would find disappointing, one of the millennials in the survey was quoted as saying "I feel like our generation has been raised to not be so worried about online privacy because it just feels like there is no alternative. Ultimately I do value privacy in theory, but it feels like it's a cost of participating in society. Not just online."

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An amusing post-script to last week's column
 
An email from a Russian friend provides a post-script to last week's column in which I suggested the formation of a business that, for a fee, could crowd the fringe in congressional or legislative races, helping ensure the re-election of moderates of either party.
 
Natalia Blokhina, who helps guide a Moscow-based fund management company that invests in U.S. companies, as well as companies elsewhere, sent me an email saying it was an interesting column.
 
Because I sought to help introduce Natalia to companies in which her fund might invest, I emailed her back asking if her fund might be interested in being an investor if the idea of a Save Our Middle LLC took hold.
 
"It would be interesting to tell people we have Russian investors in our company," I joked to her.
 
"We wouldn't want to be involved in a political company," she replied quite seriously.
 
You can search the column I did about Natalia at Flynn's Harp: Natalia Blokhina.

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