Walgreens, CVS, and Rite Aid - What RE Investors Should Know

There are 3 major drugstore chains in the US: Walgreens, CVS, and Rite Aid. Below are some key statistics about the 3 major drugstore chains as of 2012:

1. Walgreens ranks first with market cap of $28.51 Billion, $72.2 Billion in 2011 total revenue ($45.1B from prescription revenues), and an S&P rating of A. According to Walgreens, 75% of the US population lives within 3 miles from its stores. In April 2010, it acquired 258 Duane Reade drug stores in New York Metropolitan area which brings a total of 7841 drug stores Walgreens operates as of February 2012, including 137 hospital on-site pharmacies.

2. CVS ranks second with market cap of $56.56 Billion, $107.1 Billion in revenue ($40.5 Billion from CVS prescription revenues and $16.1B from its Caremark prescription mail order revenue), and an S&P rating of BBB+. As of December 31, 2011, CVS operates 7404 drug stores.

3. Rite Aid ranks third (fourth, behind Walmart in terms of prescription revenues) with market cap of $1.49 Billion, $26.1 Billion in revenue ($17.1B from prescription revenues), operates 4714 drug stores as of February 2011 and has an S&P rating of B-.

Investors purchase properties occupied by these drugstore chains for the following reasons:

1. The drugstore business is very recession-insensitive. People need medicine when they are sick, regardless of the state of the economy. Both rich and poor people in the US have access to medicine. Some even argue that low-income people use more medicine due to free or low-cost drugs offered by government-assisted programs. So the tenants should do well during tough time and have money to pay rent to landlords.

2. The drugstore business has a good prospect in the US:

· People are living longer and need more medicine to sustain longevity, e.g. Actonel for osteoporosis, Aricept for Alzheimer's symptoms. Older people tend to use more medicine than younger ones as they often have more medical problems. As the 78 million baby boomers are getting closer to retiring age starting from 2008, the drugstore chains anticipate the demand for medicine to increase in next 20 years.

· The drug market continues to expand as the US population continues to grow. More and more Americans suffer from various diseases. The number of Americans suffers from seasonal allergies doubled in the last 15 years to 37 million people per Fortune magazine. They spent $5.4 Billion in 2009 for allergy drugs. As their waist lines balloon (75% of Americans are forecasted to be either overweight or obese by 2020), more Americans are diagnosed with diabetes, along with high cholesterol at younger and younger ages. In addition, doctors also recommend treating various diseases sooner than later due to better understanding about the diseases. For example, doctors now prescribe antiretroviral drugs for patients soon after infected with HIV virus instead of waiting for the infection to become AIDS. More doctors combine insulin with oral medicines to treat type-2 Diabetes instead of just oral medicines alone. All these factors increase the size of the drug market.

· Advance in genetic engineering has introduced various new genetic DNA testing kits which allow the genetic diagnosis of vulnerabilities to inherited diseases and disorders. Genetic testing is currently the highest growth segment in the diagnostics industry. Some of these genetic tests will probably transform into direct-to-consumer testing kits available in drug stores in the near future.Upon FDA approval, these new products will potentially bring in additional revenue for drug stores.

· Using a new method of tailoring molecules called structure-based design; drug companies come up with new medicines that they might not have discovered otherwise, e.g. Xalkori by Pfizer to treat lung cancer.

· The passage of Health Care Reform Bill on March 23, 2010 provides insurance coverage to an estimated 33 million more American. This is a great present to the drugstore industry.

· There are new drugs to treat previously untreatable illnesses, and new diseases, e.g. Viagra for men's unhappiness, Avastin for colon cancer, Herceptin for breast cancer,. The new medicines are very expensive, e.g. a year's supply of Avastin costs about $55,000. Eli Lilly has sold about $4.8 billion of Zyprexa in 2007 for schizophrenia and yet most people have never heard of this medicine.

· There are existing drugs now approved to treat new illnesses and thus increase their sales revenue. For example, Lyrica was originally intended to treat pain caused by nerve damagein people with diabetes. It is now approved by FDA to treat Fibromyalgia which affects 5.8 million Americans per WebMD.

· Big advances in genetics, biology and stem cells research are expected to produce a new class of drugs to treat diabetes, Parkinson's and various rare genetic disorders. For example the new drug Ilaris from Novartis targets genetic causes of an inherited disorder that there are only 7000 known cases worldwide. However, Novartis hopes to gradually broaden its drugs to a blockbuster drug to more common disorders caused by similar genetics.

· Technology and modern life introduce and require new products, e.g. pregnancy test kits, Lamisil for stronger clearer toe nails, Latisse for longer & thicker eyelashes, Propecia for male hair loss, Premarin for menopausal symptoms, diabetic monitors, electronic toothbrushes, contact lenses, lenses cleaners, diet pills, vitamins, birth-control pills, IUDs, nutrition supplements and Cholesterol-lowering pills (Americans spent nearly $26B in 2006 on Cholesterol medications alone per IMS Health, a Connecticut-based consulting company that monitors pharmaceutical sales.)

· Before the customers can get to the medicine aisles or pharmacy counters, they have to pass by chocolates, sodas, digital cameras, watches, toys, dolls, beers and wines, cosmetics, video games, flowers, fragrances, and greeting cards. Drug stores hope you use the one-hour photos services there. The stores also carry seasonal items, e.g. Halloween costumes, and "As Seen on TV" merchandise, e.g. Shamwow. As a result, customers buy more than their prescriptions and medicine in these drugstores. CVS reported that non-pharmacy sales represented 30% of the company's total sales in January of 2007. The figure for Walgreens is 34% and 37% for Rite Aid. Many pharmacy locations are in effect convenience stores especially ones that are in residential or rural areas. And so Walgreens hopes that customers also pick up WD-40, and screwdrivers at its stores instead of at Home Depot; Thai Jasmine rice, and fish sauce to avoid a trip to Safeway or Kroger Supermarkets. During the recession, sales of these non-drug items are down as customers buy what they need and not what they want. Walgreens tries to reduce the number of items by 4000. It also introduces its own private label which has higher profit margins.

· There are more and more generic medications on the market as a number of enormously popular brand-name blockbusters lose their 20-year long patents, e.g. Lipitor (best selling drug in the world to lower cholesterol) in 2010, Viagra (you know what it's for) in 2012. Drugstores prefer to sell generic drugs to customers due to higher profit margins than the brand-name medications.

· Many people are addicted to pain killers, e.g. Hydrocodone/Oxycodone. Per the DEA in 2012, there are 1.5 million American addicted to cocaine but 7 million addicted to prescription drugs.

· This author estimates that at least 10% of the dispensed prescription drugs are not used at all and sit idle in the medicine cabinets. They are eventually expired and thrown away.

3. These companies sign very long-term NNN leases, guaranteed by their corporate assets. This makes the investment in the underlying property fairly low risk, especially for Walgreens with a S&P "A" rating. In fact, these properties are sometimes referred to as investment-grade properties. Once the drugstore chains sign the lease, they pay the rent promptly and timely. This author is not aware of any properties leased by one of these drugstore chains in which the tenants failed to pay rents. Even when the stores are closed due to weak sales (Walgreens closed 119 stores in 2007), these companies may sublease the properties to other companies, e.g. Advance Auto Parts and continue to pay rents on the master leases.

· A typical Walgreens lease consists of 20-25 year primary term plus 8-10 five-year options. During primary term and options, there will be no rent increases in most of the leases. This is the main disadvantage of investing in Walgreens drugstores.

· A typical CVS lease consists of 20-25 year primary term plus 4-5 five-year options. The rent is normally flat during the primary term and then there is a 2.5%-10% rent increase in each 5-year option.

· A typical Rite Aid lease consists of 20-25 year primary term plus 4-8 five-year options. The lease often has a rent increase every 5-10 years.

Investment Risks

Although the pharmacy business in general is recession-insensitive, there are risks involved in your investment:

1) The main downside about investing in pharmacies is there is little or no rent bump for a long time, e.g. 20-50 years, especially for Walgreens. So the rent is effectively reduced after inflation is factored in. This is one of the main reasons these properties do not appeal to younger investors, especially when the cap rate is low.

2) The 3 drugstore chains now have a new formidable competitor, Walmart. Walmart sells prescription drugs in more than 4000 Walmart, Sam's Club and Neighborhood Market stores in 49 states. As of 2012, Walmart is the third largest drug retailer with $17.4B in prescription sales, just ahead of Rite Aid with $17.1B in prescription sales. The retail giant is known for launching in 2006 a highly-publicized $4 generic prescription drug program which now sells 350 generic medications for a 30-day supply. The actual number of medications is less as the medications with different strengths are counted as different medications. For example, Metformin 500 mg, 850 mg, and 1000 mg are counted as 3 medications. Walmart probably makes very little profits on these medications if any. However, the marketing campaign--created by Bill Simon, the President and CEO of Walmart US, generates a lot of publicity for Walmart. Walmart hopes to draw customers to its stores with other prescriptions where it has higher profit margins. In an unscientific survey with just one brand-name prescription of Lyrica, this author finds the lowest price at Costco, the highest price at Walgreens and Walmart at the middle. Other drug chains try to counter Walmart in different ways. Target now offers the same 350 generic medications for $4 for a 30-day supply. Walgreens has a Prescription drugs club with membership fee which offers 1400 generic medications for as little as $1/week. CVS says it will match any offers from its competitors.

3) Chief Business Correspondent Rick Newman from US World & News Report predicted that Rite Aid might not survive in 2009. Rite Aid is still around in 2012. The prediction seems to go away in 2012 as Rite Aid as it was able to refinance the long terms debts and sales revenue has increased.

4) Drugs are also sold in thousands of supermarkets, Target stores, and Costco warehouses. However, there are no drive-through windows at these stores or Walmart to conveniently drop off the prescriptions and pick up medicines. Customers will not be able to pick up their prescriptions during lunch hour or after 7PM at Target stores or supermarkets. They need to have membership to buy medicines at Costco. Others may not fill their prescriptions at Walmart because they don't want to mingle with typical Walmart customers who are in lower income brackets. And some baby boomers don't want their prescriptions filled at Target or Walmart because there are no comfortable chairs for them to sit down and wait for their medicines.

5) Drugs retail business to some degree is controlled by the Pharmacy Benefits Managers (PBMs). Customers normally get prescription coverage from their health insurance companies, e.g. Blue Cross. These PBM manage prescription benefits on behalf of the insurance companies. In 2012 Walgreens lost a contract valued at over $5 Billion with Express Scripts, a major PBM. Walgreen revenue was immediately fallen in the first quarter of 2012 as Express Scripts customers cannot fill their prescriptions at Walgreens. The PBMs are also in the drugs retail business via mail orders which do not require leasing expensive retail spaces. The prescription mail orders currently capture over 20% market share of the total prescription revenue. Should customers change their prescription purchase habits to mail orders (there is no such evidence in 2012), it could have negative impact to the business of drugstore chains.

6) Many leases in areas with hurricanes and tornadoes are NNN leases with the exception of roof and structure. So if the roof is damaged, you will have to pay for the expenses.

7) The tenant may move to a new location down the road or across the street when the lease expires. This risk is high when the property is located in small town where there is low barrier for entry, i.e. lots of vacant & developable land.

8) The tenant may ask for rent concession to improve its bottom line during tough times. The possibility is higher if the tenant is Rite Aid and if the store has low sales revenue and/or higher than market rent.

9) More Americans are walking away from their prescriptions, especially the most expensive brand-name medicines. This may have negative impact on the sales revenue and profits of drug stores and consequently may cause drug store closures. According to Wolters Kluwer Pharma Solution, a health-care data company, nearly 1 in 10 new prescriptions for brand-name drugs were abandoned by people with commercial health plans in 2010. This is up 88% compared to 4 years ago just before the recession began. This trend is driven in part by higher and higher co-pays for brand name drugs as employers are shifting more insurance costs to their employees.

Among 3 drugstore chains, Walgreens and CVS pharmacies in general have the best locations-at major intersections while Rite Aid has less than premium locations. Walgreens tends to hire only the top graduates from pharmacy schools while Rite Aid settles with bottom graduates to save costs. When possible, all drugstore chains try to fill the prescriptions with generic medications which have higher profit margins.

1) Walgreens: the company was founded in 1901 by Charles Walgreen, Sr. in Chicago. While the company has existed for more than 100 years, most stores are only 5-10 years old. This is the best managed company among the three drugstore chains and also among the most admired public companies in the US. The company has been run by executives with proven track records and hires the top graduates from universities. Due to its superior financial strength--S&P A rating-- and premium irreplaceable locations, properties with leases from Walgreens get the highest price per square foot and/or the lowest cap rate among the 3 drugstore chains. In addition, Walgreens gets flat rent or very low rent increases for 20 to 60 years. The cap rate is often in the low 5% to 6.5% range in 2012. Investors who buy Walgreens tend to be more mature, i.e. closer to retirement age. They are looking for a safe investment where it's more important to get the rent check than to get appreciation. They often compare the returns on their Walgreens investment with the lower returns from US treasury bonds or Certificate of Deposits from banks. Walgreens opened many new stores in 2008 and 2009 and thus you see many new Walgreens stores for sale. It will slow down this expansion in 2010 and beyond and focus on renovation of existing stores instead.

2) CVS Pharmacy: CVS Corporation was founded in 1963 in Lowell, MA by Stanley Goldstein, Sidney Goldstein, and Ralph Hoagland. The name CVS stands for "Consumer Value Stores". As of 2009, CVS has about 6300 stores in the US, mostly through acquisitions. In 2004, CVS bought 1,200 Eckerd Drugstores mostly in Texas and Florida. In 2006, CVS bought 700 Savon and Osco drugstores mostly in Southern California. And in 2008 CVS acquired 521 Longs Drugs stores in California, Hawaii, Nevada and Arizona for $2.9B dollars. The acquisition of Long Drugs appears to be a good one as it CVS did not have any stores in Northern CA and Arizona. Besides, the price also included real estate. It is also bought Caremark, one of the largest PBMs and changed the corporation name to CVS Caremark. When CVS bought 1,200 Eckerd stores, it formed a single-entity LLC (Limited Liability Company) to own each Eckerd store. Each LLC signs the lease with the property owner. In the event of a default, the owner can only legally go after the assets of the LLC and not from any other CVS-owned assets. Although the owner loses the guaranty security from CVS corporate assets, this author is not aware of any incident where CVS closes a store and does not pay rent.

3) Rite-Aid: Rite Aid was founded by Alex Grass (he just passed away on Aug 27, 2009 at the age of 82) and opened its first store in 1962 as "Thrif D Discount Center" in Scranton, Pennsylvania. It officially incorporated as Rite Aid Corporation and went public in 1968. By the time Alex Grassstepped down as the company's chairman and chief executive officer in 1995, Rite Aid was the nation's largest drugstore chain in terms of total stores and No. 2 in terms of revenue. His son, Martin Grass, took over but was ousted in 1999 for overstatement of Rite Aid's earnings in the late 1990s. Rite Aid is now the weakest financially among the 3 drugstore chains. In 2007, Rite-Aid acquired about 1,850 Brooks and Eckerd drugstores, mostly along the East coast to catch up with Walgreens and CVS. In the process, it added a huge long term debt and is the most leveraged drugstore chain based on its market value. The integration of Brooks and Eckerd did not seem to go well. Revenue from some of these stores went down as much as 20% after they change the sign to Rite Aid. In 2009, Rite-Aid had over 4900 stores and over $26 Billion in revenues. The figures went down in 2010 to 4780 stores and $25.53 billion in revenue. On January 21, 2009 Moody's Investor Services downgraded Rite Aid from "Caa1" to "Caa2", eight notches below investment grade. Both ratings are "junk" which indicate very high credit risk. Rite Aid contacted a number of its landlords in 2009 trying to get rent concession to improve the bottom line. In June 2009, Rite Aid successfully completed refinancing $1.9 Billion of its debts. In 2012, Rite Aid benefits from Walgreens contract problem with Express Scripts. Same store sales increased 2.2%, 3.2%, and 3.6% for January, February and March of 2012, respectively. Rite Aid is still losing money in fiscal year 2012 which ended in March 3, 2012. However, it is losing less, $0.43 per share in 2012 versus $0.64 per share in fiscal year 2011. The company expects better outlook in fiscal year 2013.

Things to consider when invested in a pharmacy

If you are interested in investing in a property leased by drugstore chains, here are a few things to consider:

1. If you want a low risk investment, go with Walgreens. In stable or growing areas, the degree of safety is the same whether the property is in California where you get a 5.5% cap or Texas where you may get a 6.5% cap. So, there is no significant advantage to invest in properties in California as the property value is based primarily on the cap rate. In 2012, the offered cap rate for Walgreens seems to come down from 7.5%-8.4% in 2009 to 5.5%-6.5% for new stores.

2. If you are willing to take more risk, then go with Rite-Aid. Some properties outside of California may offer up to 9% cap rate in 2012. However, among the 3 drug chains, Rite Aid has 10.5% chance of going under in 2010. Should it declare bankruptcy, Rite Aid has the option to pick and choose which locations to keep open and which locations to terminate the lease. To minimize the risk that the store is shuttered, choose a location with strong sales and low rent to revenue ratio.

3. Financing should be an important consideration. While the cap rate is lower for Walgreens than Rite Aid, you will be able to get the best rates and terms for Walgreens.

4. If you are not a conservative investor or risk taker, you may want to consider a CVS pharmacy. It has BBB+ S&P credit rating. Its cap rate is higher than Walgreens but lower than Rite Aid. Some leases may offer better rent bumps. On the other hand, some CVS leases, especially for properties in hurricane areas, e.g. Florida are not truly NNN leases where landlords are responsible for the roof and structure. So make sure you adjust the cap rate down accordingly. Some of the CVS locations have onsite Minuteclinic staffed by registered nurses. Since this clinic idea was introduced recently, it's not clear having a clinic inside CVS is a plus or minus to the bottom line of the store.

5. All 3 drugstore chains have similar requirements. They all want highly visible, standalone, rectangular property around 10,000 - 14,500 SF on a 1.5 - 2 acre lot, preferably at a corner with about 75 - 80 parking spaces in a growing and high traffic location. They all require the property to have a drive-through. Hence, you should avoid purchasing an inline property, i.e. not standalone and property with no drive-through windows. There is a chance that these drugstores may not want to renew the lease unless the property is located in a densely-populated area with no vacant land nearby. In addition, if you acquire a property that does not meet the new requirements, for example a drive-through, you may have a problem getting financing as lenders are aware of these requirements.

6. If the pharmacy is opened 24 hours a day, it is in a better location. Drugstore chains do not open the store 24 hours day unless the location draws customers.

7. Many properties may have a percentage lease, i.e. the landlord can get additional rent when the store's annual revenue exceeds a certain figure, e.g. $5M. However, the revenue used to compute percentage rent often excludes a page-long list of items, e.g. wine and sodas, tobacco products, items sold after 10 PM, drugs paid by governmental programs. The excluded sales revenue could account for as much as 70% of store's gross revenue. As a result, this author has seen only 2 stores in which the landlord is able to collect additional percentage rent. The store with a percentage rent is required to report its annual sales to the landlord. As an investors, you want to invest in a store with strong gross sales, e.g. over $500 per square foot a year. In addition, you also want to check the rent to revenue ratio. If the figure is in the 2-4% range, the store is likely to be very profitable so the chance the store is shut down is low.

8. It does not matter how good the tenants are, avoid investing in declining, e.g. Detroit and/or low-income areas or small towns with less than 30,000 residents within 5 miles ring. In a small town, it may be the only drug store in town and captures most of the market share. However, if a competitor opens a new location in the area, revenue may be severely affected. In addition, the tenant can always moves to a new location down the road when the lease expires since there is low barrier to entry in a small town. These properties are easy to buy now and hard to sell later. When the credit market is tight, you may have problems finding a lender to finance these properties.

9. Many properties have an existing loan that the buyer must assume. If you have a 1031 exchange, think twice about buying this property. You should clearly understand loan assumption requirements of the lenders before moving forward. Should you fail to assume the existing loan (assuming an existing loan is a lot more difficult than getting a new loan), you may run out of time for a 1031 exchange and may be liable to pay capital gain.

10. With few exceptions, drugstore chains do not own the stores they occupy for several reasons. Here are just a couple of them:

- They know the pharmacy business but don't know real estate. Stock investors also don't want Walgreens to become a real estate investment company.

- Owning the real estate will require them to carry lots of long term debts which is not a brilliant idea for a publicly-traded company.

11. About 10% of the drugstore properties for sale and typically CVS pharmacies require very small amount of equity to acquire, e.g. 10% of the purchase price. However, you are required to assume an existing fully-amortized loan with zero cash flow. That is, all of the rent paid by the tenant must be used to pay down the loan. The cap rate may be in the 7-9% range, and the interest rate on the loan could be attractive in the 5.5% to 6% range. Hence, the investor pays off the loan in 10 to 20 years. However, you have no positive cash flow. This requires you to come up with outside cash to pay income tax on the rental profits (the difference between the rent and mortgage interest). The longer you own the property, the more outside cash you will need to pay income taxes as the mortgage interest will get less and less toward the end. So who would buy this kind of property?

- The investors who have substantial losses from other investment properties. By acquiring this zero cash flow property, they may offset the income from the drugstore tenant against the losses from other investment properties. For example, a property has $105,000 of rental profits a year, and the investor also has losses of $100,000 from other properties. As a result, the combined taxable profits are only $5,000.

- The uninformed investors who fail to consider that they have to raise additional cash to pay income taxes.

Out of the Box Thinking

If you put too much weight on the S&P rating of the tenants, you may end up either taking a lot of risks or passing up good opportunities.

A Good location should be the key in your decision on which drug store to invest in. It's often said a lousy business should do well at a great location while the best tenant will fail at a lousy location. A Walgreens store that is closed down later on (yes, Walgreens closed 119 stores in 2007) is still a bad investment even though Walgreens continues paying rent on time. So you don't want to blindly invest in a drug store simply because it has a Walgreens sign on the building.

No company is crazy enough to close a profitable location. It does not take rocket science to understand that a financially-weak company like Rite Aid will make every effort to keep a profitable location open. On the other hand, a financially-strong Walgreens will need justifications to keep an unprofitable location open. So how do you determine if a drug store location is profitable or not if the tenant is not required to disclose its profit & loss statement? The answer is you cannot. However, you can make an educated guess based on the store's annual gross revenue which is often reported to the landlord as required by the percentage clause in the lease. With the gross revenue, you can determine the rent to income ratio. The lower the ratio, the more likely the store is profitable. For example, if the annual base rent is $250,000 while the store's gross revenue is $5M then the rent to income ratio is 5%. As a rule of thumb, it's hard to make a profit if this ratio is more than 8%. So if you see a Rite Aid with 3% rent to income ratio then you know it's likely a very profitable location. In the event Rite Aid declares bankruptcy, it will keep this location open and continue paying rent. If you see a Rite Aid drug store with 3% rent to income ratio offering 10% cap, chances are it's a low risk investment with good returns and the tenant will most likely to renew the lease. The weakness of corporate guaranty from Rite Aid is probably not as critical and the risk of having Rite Aid as a tenant is not really that significant.

Drug stores with new 25 years leases tend to sell at lower cap, e.g. 6-7% cap on new stores versus 8.0-8.5% cap on established locations with 5-10 years remaining on the lease. This is because investors are afraid that the tenants may not renew the leases. Unfortunately, lenders also have the same fear! As a result, many lenders will not finance drug stores with 2-3 years left on the leases. The fact that drugstores with new leases have a premium on the price means they have potential of 20% depreciation (buying new at 6% cap and selling at 7.5% cap when the leases have 8 year left). Some investors will not consider investing in drug stores with 5-10 years left on the lease. They might simply ignore the fact that the established stores may be at irreplaceable locations with very strong sales. Tenants simply have no other choices other than renewing the lease.

David V. Tran is the President and Chief Investment Advisor at Transmercial, a commercial real estate & loan brokerage company in San Jose, CA. His website is www.transmercial.com. He may be contacted at (408) 288-5500. Transmercial does business in all 50 states. David currently offers 2 FREE real estate investment seminars/webinars: How to invest in commercial real estate. How to maximize cash flow with 1031 tax-deferred exchange.

David's blog features a daily list of 10 Best Commercial Properties in 50 states.

You are welcome to share this report, unedited and in its entirety, with anyone you like. You may not remove this text. © 2007-2012 Transmercial.

The International Baccalaureate: Why Parents and Students Should Demand It for Their Schools

Happily for all of us in the "Good Old US of A", our friends in other parts of the world tend to be patient with us. Either that or they are happy to allow us to sleep soundly as the rest of the world moves quietly past us- perhaps like the Aesop's Fable of the Hare and the Tortoise. We will return to Aesop shortly. Let's push onward...

When you hear the recent group of Republican candidates pander to the denizens of the far right of the political spectrum, there is a lot of flag-waving and Bible thumping and gun-toting going on that we didn't see even 10 years ago. Remember, for example, when all of the baseball stadiums in the mid- seventies had foot signs as usual with the metric equivalent underneath. You remember the metric system don't you?- its adoption was at least being given something less than "short-shrift" by our politicians at that time. This logical process of measuring by tens should be a "no-brainer" as they say. It loses, not because of its logic, but because "it's a foreign thing." What are the chances of America adopting something "foreign" today?

As an Italian acquaintance pointed out to me... You folks in the United States always depict Italians as gangsters. Your history book goes back perhaps 300 years. Have you heard of the Roman Empire whose roads and government, for example, facilitated the spread of Christianity, brought water hundreds of miles, accurately measured time and seasons, had architecture that today could not be duplicated, while providing a measure of 14th Amendment due process to important people like the Apostle Paul who could say, "I am a citizen of Rome" which guaranteed at least a trial when he was captured. Or perhaps you have heard of Leonardo DaVinci, Marco Polo, Christopher Columbus, Guglielmo Marconi, to name a few. Our history goes back over 2000 years. You have been here for 5 minutes and you think you invented science, art, government, mathematics, medicine, etc.

American ethnocentrism is legendary. Sinclair Lewis wrote about it in the early 20th Century. His book "It Can't Happen Here" should be read today- right now-Quick! People in the Tea Party want it to be 1955 again when those "foreigners knew their place dag nabbit!" Its time to change all of this if we really expect to be "competitive" (Presidents love this cryptic word) in the 21st Century. Parents should be demanding the International Baccalaureate as an option at the very least.

Interestingly, those same politicians of the present-day are strong supporters of former American Corporations that have become multi- national and know no national boundaries nor do they have any national affiliations. Globalization has made that a reality.

So when you hear the President saying that our schools must become more competitive - we must ask the questions, Competitive with who?, and About What? Must Exxon America be competitive with Exxon India? Its just plain Exxon anymore isn't it? It's not USA vs. India, or China. You might think that it is- and the media and the politicians frame it that way for those of you who still wish there was a Memorial day parade and a July 4th Parade. They show you the new incredibly large Chinese aircraft carrier as a distraction since hacking another country's computerized power grid, air traffic control system, and banking system for example will be causing far greater chaos and can already be done- without a big aircraft carrier- and if it was we'd all be killing one another in the streets while the Chinese Army is asleep in their beds. Do you think the Chinese are unaware of this?

Where are we going? Simply stated, we in America think we invented Education. Our history books still act as though everything started in the Middle east *(just for Adam and Eve and some inconvenient religious stuff- like Jesus for example)- quickly went to Europe, then came here with Columbus. We don't talk about the Arabs for example who invented Algebra and did surgical things that astonished the people in Europe- or the amazing things Marco Polo found at the court of Kublai Khan? The astonished Europeans were, of course, the ones who were actually permitted to learn to read without fear of being killed as heretics in the "Dark Ages."

They say that Patton had a difficult time convincing his superiors about the concept of tanks in the next war because there was still horse cavalry in the US Army, circa 1938. The tanks are called "Cavalry" today. Progress takes time here.

Our public school system like the cavalry up till the second world war is still trying to catch up to Sputnik, and spending most of its time taking or preparing for the decontextualized- who wants to be a millionaire multiple choice tests. The current system of Standardized testing has only one objective, that of discouraging young people- while sorting and classifying them- so that eventually many will lower their aspirations intuitively, quit school, and take the jobs that people with green cards are now happy to take. I know some of you don't believe that, so start by reading about something called the "Mudsill Theory". Stated succinctly by a South Carolina Senator in 1858 or so, a society succeeds or fails based on the quantity of people it has who are willing to do the menial tasks for minimum wage and no benefits. If a country lacks those kind of people, some think, they must import them or create their own. Witness the turmoil in Europe in countries where the first choice to import was made.

It should not be a surprise to you, then, that every Independent school in the world awards the International Baccalaureate to its graduates, and there is a very successful Pre K-12 process designed to develop scholarly, innovative, creative, humanistic citizens prepared to confront the global challenges and rewards that lie in the future. By the way, they don't give those endless multiple choice tests to their students.

What is it about the International Baccalaureate that is so appealing?

The International Baccalaureate was founded in Geneva, Switzerland in 1968. It starts out being far more humanistic and it demands thinking on a higher level by young people. In a brilliant proactive move which foreshadowed the world of the 21st Century, the program was created with the focus being to create "World Citizens" meaning people who would be able to live, work, and compete anywhere in the world. Recently, the IB added its 4,000th program to its worldwide list of institutions in approximately 150 countries. (Trying naming more than 50 countries some time- Forget it, you are an American, bet you can't do it!) Similar to the AP Program, students with IB credit for specified courses can get college credit. Of course, the American Association of University Professors, AFT, and the various state college unions in America hate to allow anybody to get credit for anything because it means less people in the class that remains required to protect jobs- like a stat course for teachers- who will never calculate a standard deviation in their professional lives.

The difference between Advanced Placement and the International Baccalaureate is that American students selecting AP course may do so at their pleasure, selecting the courses they wish to take based on the schools requirements for eligibility. The IB requires students to take 6 interdisciplinary courses, complete appropriate detailed research papers, and complete a community service requirement.

The IB encourages young people to debate topical, moral, and social issues. Children as young as 3 years old can be involved in the program under the PYP Program (Primary Years Programme). Students follow this until they are 12 years of age, then they enter the MYP (Middle Years Programme) till age 16, followed by the IB Diploma programme at the age of 16.

The course offerings for the student who has reached 16 years of age includes the following:

3 courses that are standard level subjects.

3 courses that are higher level subjects

A Theory of Knowledge Course(TOK)

A Scholarly Essay (4000= words)

They are also, vis a vis their course, assessed as to Creativity- Action- and Service to Others.

The groupings of courses are as follows:

Students select one from each of the following:

Group 1: Native (First Language)

Group 2: Second Language- French, Spanish, German, Mandarin, Latin, Greek (minimum) and these can be taken over three years, i.e. Mandarin I, II,III.

Group 3: Individuals and Societies- Business and Management, Economics, Geography, or History

Group 4: Experimental Sciences- Biology, Chemistry, or Physics.

Group 5: Mathematics

Group 6: Arts Selection- Music, Theater Arts, Visual Arts.

The theory of Knowledge course, as explained by Prof. Thomas Brown is the core of the IB and it challenges the students to think critically. Some examples of questions include:

How is knowledge gained and from what sources?- this relates to epistemology

To what extent do personal experience and ideology influence our knowledge claims?

What differentiates statements like "It is certain" and "I am certain".

Does a moral life manner?

It is important to note that this type of interaction does not produce one correct answer. Factual recall is a very low level of learning. There are some people who want it that way in this country. The IB moves to higher levels of thinking and encourages human interaction and mutual respect of the opinions of others.

There exists sufficient flexibility in the system such that one could, instead of taking a group 6 offering, could take a second language, or science, for example. The courses go much further in depth than the typical American courses that, like Olympic Game television coverage, tries to cover a "Little bit about a Lot" rather than a "Lot about a little Bit"- an over- simplification, to be sure, but it hasn't worked very well with the Olympic coverage- remember the drama of watching the WHOLE High Jump event for example?

A statement from the 1996 IB Organization Subject Guide asserts that, "An international education must go beyond the provision of information and is involved in the development of attitudes and values WHICH TRANSCEND BARRIERS OF RACE,CLASS, RELIGION, GENDER.OR POLITICS."

There are people on the right side of the political spectrum who hate statements like this because it means really acting in the Judeao-Christian mode and living and succeeding in a diverse world while being kind to the less fortunate. Yet, these same individuals support strongly the laissez-faire, less government, capitalist, Ayn Rand,Corporate paradigm that is taking their corporations to international places leaving behind the menial jobs. Was it Einstein who said that the definition of Insanity is to keep doing the same thing and expecting different results? At the present rate that the world is changing and the jobs are going elsewhere, all but a small amount of American Public school children will be doing something other than taking the menial jobs, while IB educated professionals will be taking the real jobs in places other than Main Street. At the same time, the IB is designed to insure that its graduates will be significantly more employable internationally than their American counterparts. They will also approach things in a more scholarly and statesmanlike manner.

Siva Kumari, Chief Operating Officer of IB asserts that one purpose of the program is to provide a knowledge base to our students that they will be able to apply to a variety of different jobs in many different nations. Wow, can your locally run school district make such an assertion? But wait, there's more... Kumari is all about pragmatism too as she adds that, "We teach a canon of knowledge we think students should know so that it does not matter what job they have or where they go, students WILL BE ABLE TO ADAPT TO ANY CONTEXT. We are, she continues, "CREATING LEARNERS." Some of this would be heresy in our schools- Philadelphia for example where, at standardized test time, everything on the walls that might provide a morsel of an answer to a student must be covered in black drapes- whew, "The Land of the Free" huh?

What is the American reluctance to embrace a program of study that will prepare students for the world that is and that is to come? "Real"( a scary term) Americans who embrace freedom and independence and creativity should be outraged at the classifying and sorting process that is occurring vis a vis the standardized testing process- cleverly tied in with the shibboleth "No Child Left Behind", all the while guaranteeing a steady stream of uncreative undereducated consuming robots with a high dropout rate, while students in Independent Schools the world over are not so burdened but are granted the precious opportunity to be creative, think out of the box, apply their learning to real, authentic settings anywhere in the world.The teacher is given much greater respect in the IB process as well- compared to American Public Schools where a sincere effort is underway to "teacher-proof" the curriculum. Does anyone in America really think that if all the test scores suddenly went up, the corporations who have left the country would all come back? What is the stage you want your child competing on in a scholarly sense? The little one in the church basement on Main street or on the World Stage?

As always, we want to look beyond valuing something based solely on "snob appeal", but as a Principal, I can assure you that children's course choices were often based upon what the really smart kids on your street were taking. So, even if you do not examine this program in a scientific manner as you should, allow your children to be able to "come to the table" so to speak with the same credentials that the children have who have graduated from Independent schools where they don't have to take standardized state exams longer then the bar exam every year. There is a story, perhaps apocryphal, that the owners of the Pony Express were sitting around a table brainstorming about improving service... "Faster horses", said one exec... "Riders with Master's Degrees" said another, "Bigger but lighter mail sacks", said a third," "More guns and ammo to fend off Indians and wild animals", offered the fourth. At the end of the meeting, they were all fired up about the new improved Pony Express. In the same week, the last spike was driven in the new intercontinental railroad. The Pony Express filed for bankruptcy the following year.

There are moral implications to how a country educates their young people. In America, people who were "different" have always had a difficult time and continue to do so. Women, Blacks, Jehovah's Witnesses, Indians, Japanese-Americans in WWII, Gays, all have had to fight for things which were already spelled out in the constitution. The International Baccalaureate fosters discussion on uncomfortable topics, allowing for divergent thinking among its students. The Apostle Paul said this in his letter to the Romans... "Don't be conquered by the evil but conquer the evil with good..." As you read the next paragraph, ask yourself which system of education tries to adhere to Paul's admonition.

Thomas Baker, an IB teacher stated the matter with eloquence when he said that in the USA it was once thought that you could have "Separate but Equal" schools for white and non-white children.(Guess who got the hand me down books and football helmets in a southern city in this "separate but equal" system) In the early 1950's, Brown v. Board of Ed. caused this fallacy of false equality to be overturned. This of course opened the door for special needs children and victims of gender bias, for example. But if education( the United States public schools), continues Baker, conceives of itself as separate from the rest of the world, it is committing the same fallacy that Brown v. Board of Ed. Sought to reverse, only this time, its on a massive, global scale"...with the United States system serving as the "Non-white" schools for this analogy. Stated simply, Americans should be demanding the IB program for their children because it reflects more accurately the chain of events now occurring and the zeitgeist that we exist in at the present moment. Eight weeks studying Civil War battles, really? Not offering Chinese, German, French.Latin, Greek, etc., to name a few?

Emmett Mc Groarty, Executive Director of Preserve Innocence, an initiative of the American Principles Project argues against the IB by asking, Should we spend taxpayer dollars on a public school curriculum commissioned by the United Nations, made in Europe, and at odds with the principles of the American Founding? Through the IB, this is already happening."

Having heard that quote, we must return to Aesop's Fables and this time, The Emperor's New Clothes. When will someone be like the little boy on the corner who yells that the King has no clothes on- to the dismay of the townspeople pretending everything was OK- and tell Mr. Mc Groarty and our leaders that there is more to learning than standardized tests? The people demanding less government have militarized and micro-managed the schools.

What do you think? America is approximately 30th in the world in infant mortality among industrialized nations, 18th in math test scores and clearly not the leader in a host of other metrics. Vacations and health care and other benefits are hopelessly demode as taking care of our people is no longer a priority. How is that ostrich approach(head in the sand) working? In many American schools, 4 year of Social Studies is required along with English- every day, every year. Why? The English teachers only teach literature and poetry anymore anyway. One leading politician thought it a disgrace that children did not know that Columbus discovered America in 1492. Who cares? You can find it on your laptop if you really needed it -which you don't. Our students need to be learning, discussing, sharing, comparing, contrasting, in situated cognitive learning situations with a transfer of learning happening between the theory and the practical application. Why would people in this country not want their high school graduates put in a position that maximizes their talents and gives them an opportunity to compete on the world stage?

The IB has been doing this since 1968. The baseball fences had meters under the foot measurement in those days. Do you want fries with that cheeseburger sir?

Daniel L. Chandler is a Professor of Pedagogy at The College of New Jersey. In a previous life, he was a high school principal for 18 years.

7 Reasons You Should Be Using Social Media

1. Social media is the 21st century Town Hall.

People do not meet the way they used to. Sure, we all still attend meetings at church and at city hall and at our children's teacher conferences, but more and more people are congregating online. Did you know that, according to iStrategyLabs, Facebook's United States' user base grew by 144.9% in 2009? Some estimates put all Facebook activity worldwide at as high as 20% of all internet traffic!

Facebook, and increasingly Twitter, are the places people are going to find out what is happening in the lives of their friends and family. Furthermore, with the explosion of fan pages, users are seeking out news from businesses, organizations, and causes that they support.

Friends and family meet regularly on Facebook. Colleagues and like-minded people use Twitter to share ideas throughout the day. Professionals are connecting on LinkedIn. Flickr and YouTube stream photos and videos to the world eternally. And blogs are maintained for topics as varied as pro football officiating and crocheting. All this is going on 24 hours a day, every day of every year. Is your business connecting with people where they are now?

2. Yours is a small company.

You own a small business, perhaps a local party store or an independent insurance agency. Social media is intriguing, but you cannot see the benefit to a business of your size. Let's say you own a small party store. You check out the largest chain pharmacy's Facebook Fan Page. They have 433,000+ fans. Do you have 433,000 customers?

Or say you are an insurance agent. After spending some time on a national insurer's Facebook fan page, you find you're joining 16,600+ others. Do you have 16,600 clients?

Small businesses need revenue streams more than ever. One cost effective way to generate business is through social media marketing. People who become your fans and see regularly what you post on your fan page are more likely to do business with you than a larger company with whom they might not share a connection.

Social media does not have to be a daily task, but it certainly should be something used weekly. A small business might post community news, events in the lives of staff members and their families, cross-promotions with other local businesses, and content related to its products or services.

3. Yours is a large company.

You are a president of business development for a large, globally-known company. The board of directors has asked you to find new ways of connecting with prospective customers. Let's go back to the example of chain pharmacies. The number of fans is staggering - 433,000 - when you consider how few fans Competitor #1 has (5,967) and that Competitor #2's page (88 fans) is apparently created by someone outside the company. If you are in business development for the competitors, do you think there is an urgency to use social media effectively?

Social media is essential to large companies in the 21st century. Modern consumers are discerning and intelligent. They want companies to be responsive and transparent. Social media allows your company to hear from and speak with customers, address their concerns, and generate positive feelings about your brand.

4. Your client base is mostly local.

Your company is successful on the local level; it sustains your business and you've reported moderate growth for several years. But lately you have wanted to drive business on a larger level.

Social media is a place to go "remote" while never leaving home. The beauty of platforms such as Facebook, LinkedIn, and Twitter is that you can reach a global audience from wherever you are. These sites will allow your business to be seen and known by thousands and thousands of people who might otherwise never know it existed.

Your business can promote its products and/or services to these new potential customers. You can inform them of your past successes and current specials. You can tailor orders easily without having to spend time on the phone or meet in person. Social media will introduce you to new people and render services to them more efficiently.

As well, local support will grow for your business so long as you focus some content on items of local interest. Producing social media content about civic news, high school events, community fundraisers, and the like will keep your base loyal and growing.

5. Your client base is mostly remote.

Your company sells mostly to customers who are remotely located from you. You engage people mostly through your website. Business is good, but you haven't made much progress with local customers. Perhaps you are a new business in a region that has long been faithful to a competitor. Social media is a way to bridge this gap. Your company may simply suffer from a lack of exposure. A strong presence on social media sites is evidence to prospective customers that you are interested in their ideas and that you are responsive to their concerns. These platforms of "open conversation" can showcase your business as part of a mutually-supportive community.

6. Your friends (and their friends) are your best advocates.

Who are you more likely to trust when he says you should buy a car from a particular dealer - someone you just met on the street or your friend of 20 years? We hope you chose the latter. If so, you are like 99% of the people in this world who believe the word of their friends because they share a common past and have trusted them in other situations.

A company needs friends or fans or followings (depending on the social media platform). You need not fear that you are breaching a social contract with friends so long as your social media is about your customers, their needs, and conversations driven by them. Strangers don't want to be "sold" anything and neither do your friends.

Social media is about conversation and community and relationships. Developing strong relationships does not mean you cannot promote your business, but it does mean you have to listen more than you talk.

7. Money goes where people go.

You can't afford not to participate. The perception of social media is that it is for young people. Sure, Facebook and MySpace began as platforms for college students and high school kids. However, according to iStrategy Labs, Facebook users of the age 35 and older are now 30% of the entire user base. Additionally, in 2009, users who are 55+ grew an astounding 922.7%. In fact, every demographic grew in 2009 except college users.

So everyone and their brothers are using Facebook and other social media platforms. Grandmothers are sharing pictures of grandchildren on Flickr. Auto dealerships are bringing the showroom to the customer's home with videos of cars on YouTube. And the local coffee shop is "linked in" with a new coffee bean distributor with lower shipping costs. People are taking their lives and their money to these virtual worlds. Are you there to meet them?

Getting Started Yesterday

Social media, while not ubiquitous to business, is by no means still a mystery. There are thousands of businesses of all sizes who "get it". Is yours one of them? If so, that is great and we'd love to share insights with you. If not, how will you get up to date? Where do you begin?

Facebook is the proverbial tip of the social media iceberg. The best advice we have is: choose one to three platforms and commit yourself to producing content on each one consistently. If we had to suggest three, we would probably choose Facebook, LinkedIn, and a company blog. However, Twitter, Flickr, YouTube, and many other sites have their merits. Depending on your size, time constraints, and budget, you may want to hire an outside agency to handle social media content. Whichever path you choose, we welcome you to the conversation.

iStrategyLabs is a social media solutions company. Their Facebook research can be found by searching their name in a Google search.

Now, we understand that the majority of businesses do not have the time to execute even half of these engagement methods. At Xspond, we can. Our social media staff can implement these ideas and all the other ones we develop with you. Let us show you how at http://www.xspond.com.

Social Media Programs
Work Phone: 810-225-8350

Should The G8 Be In Charge Of Education, Sustainable Development And Humanitarian Services

Should the G8 be in charge of education, sustainable development and humanitarian services in the Developing world?

Lessons in life come via formal and informal education, while formal education by most is valued as a human right it can also be utilized to train and develop partakers into self-sufficient contributors and participants towards the development of sustainable societies. Many others take education for granted and use it to spread general and even useless knowledge. Education must be taken seriously to protect Human Rights and enhance peace and sustainable environments in developing societies. Since there are immediate troublesome conditions throughout the world, and especially in developing states in Africa, one must deeply consider what role formal education can play to hasten holistic development of the people towards bringing solutions to conflicts. Many of the G8 nations have been the caretakers of the developing world for at least the last century. Although this time has proven to be quite successful for most of the developing nations, has there really been any measurable success for African people? Has there been measurable success for poor people? And not to unfairly place blame, has anyone besides the G8 even taken the interest or responsibility to find solutions to help educate and assist development in poor countries otherwise?

These strong European and American alliances are the foremost leaders in education and development across the globe. They are creators of most of the religious, social, economic and political organizations that provide programs and services that assist developing nations and they work together to provide humanitarian support to developing peoples throughout the world. Yet, ironically, these European partners are also among those since the beginning of the slave trade in the 1600s, 1885 and beyond that have combined resources to trigger colonialism and neo-colonialism, and setting up bureaucracy that has played a very significant role in the under-development of African states as well. For centuries, this leadership has gathered valuable resources from especially Africa and from other developing nations in South America and had utilized both human and natural resources to service their own national interest and drive their economic and technological development. If in truth this is a historical fact about the history of our leaders, then have our leaders evolved to be good stewards since the active practice of enslavement, apartheid and colonialism? Have they become willing and able enough to create educational services, and social welfare systems that can empower those they once sought to dominate?

A brief 'stroll down memory lane' will allow us to remember the roles that our leaders have played in crimes against humanity. Hate, racism, greed, and having little regard for the human life of poor peoples are some of the human dis-eases recognizable as the causes of both the exploitation and genocide of African related and other peoples. Certain systems of domination were implemented by most of the G8 governments that severely exploited human rights. One such exploitation existed in slavery. Slavery is a system noted by the United Nations Human Rights Charter, to be a severe violation of human rights. Although many of the G8 nations have offered formal apologies for enslavement of humans there had been no reparations or solutions to the poverty that slavery and apartheid and colonialism created, given to most of the people that have suffered and chiefly those of African descent.

These African related people are themselves not respected by other nations and thought to be abusers of themselves and indifferent, and are among the same populations that present in large numbers as the impoverished and needy. On the other hand, since there has been no formal display of remorse to show respect for life in their behalf and no sentiments that seek to replace or rejoin families that were separated. And are there any sincere activities by leading governments to make amends for land, possessions or lives lost for those enslaved or exploited? Has there been a real effort to provide reparations for the lost of life, dignity and human rights? Additionally with no formal activities to address the trauma that these certain groups experienced for generations, is there any wonder how serious social problems including poverty might prevail among those with former slave, apartheid or colonial experiences?

And finally, some ask, how can the same Leaders who appear not to support the reparation of crimes against humanity perpetrated on specific peoples seek to bring other leaders of countries to justice for similar atrocities, RE-SURFACE as the teachers and healers of those same societies and the world? It is possible that governments do have remorse and seek healing from somewhere to learn how to show respect for people they once hated or abused. But let's ask the Afrikaners, if they have healed from the system of Apartheid in the last 20 years, where suddenly in the last 20 years almost 70 percent of the cases of HIV are in Africa, with the most cases in South Africa. Why are these Black African populations suddenly the most infected with HIV, and they appear not to thrive specifically? Could there really be a plan of genocide targeting specific people to gain their resources? I pray genocide in 2007 is not a reality, but if this is the case, human-kind and particularly those who stand up as global leaders are still terrible offenders of Human rights and need serious support in their recovery.

But maybe the same religions that were used to enslave Africans and others are working towards the healing of man-kind and can mend the dis-respect for life that caused exploitation and crimes against humanity such as slavery and genocide? Maybe the government and leadership of yesterday active in committing crimes against humanity did eventually want to rectify human dis-eases that caused exploitation and so they produced a document that would eventually manifest justice as created in the Declaration of Independence of 1776,

When in the Course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation. We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights that among these are Life, Liberty and the pursuit of Happiness. -- That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, -- That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness....But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security. --

When the initial colonies wanted freedom from Britain their aim was to create a government that would protect human rights and they themselves were champions of liberty. Today have Americans lost sight of the initial purpose of America---to protect Life, Liberty and the pursuit of Happiness for all men? Since most of us really have faith in life and Liberty it is certain that many would like to support the protection of the quality of life that our constitution as human, as opposed to animal stands for. We do not want to believe that there are leaders operating in 2007 who no longer care about protecting this quality of life. It appears that something has gone astray from the initial declaration of Independence that greatly supported the protection of Human rights and the happiness of mankind?

Consequently, some are not very confident that leading governments want to be successful in providing human services or champions of peace. Certainly, the last 50 years had not hosted a global environment of peace and security to warrant success. Even less than 40 years ago, numerous martyrs were assassinated and imprisoned in the name of human rights and development or peace: remember, Martin Luther King, Malcolm X, Marcus Garvey, Gandhi, Nelson Mandela, Patrice Lumumba and Kwame Nkrumah just to name a few. In more recent history Leaders in the African-American community are still arrested or detained for unifying their communities to enhance the quality of life of economic development: remember Yahweh Ben Yahweh who was arrested and detained from 1990-2007. It is thought, he was arrested just because his community became economically sustainable. This happened in America. It would appear that government leaders in today are not in the business of supporting education systems or services that support the development of leaders that seek to protect human rights, at least this proven to be the case for African related or poor people specifically.

If this is so, can the G8 or other super powers be supported in their lead especially in sustainable development programs and global peace for Africa or elsewhere? Can they continue to take charge of programs and services that are established to protect human rights if their evaluation is not good?

The European alliances through religious missions or programs are the foremost providers and pioneers of services to humanity and continually raise money to serve and protect the needs and wants of developing peoples especially. Consequently, they have had the most potential to champion human development and the peace process. They have been the Global leaders in developing systems in Education, Health, Economics, Social Welfare, Business and Commerce and the pioneers in implementing related programs, services and activities across the globe. Certainly they have been successful in protecting the human rights of some, but it is also evident that they have not supported the sustainable development of Africa. Maybe they need guidance to direct their Human development and Education to insure a better progress for African-related and poor people in the future.

A look at recent history reflects that they need support in providing effective programs or services to Africa specifically. The protection of Human Rights in the last 50 years in Africa shows little progress in peace and sustainable economic development. A 2005 UN Human Development magazine about Africa reported 70 percent of the worlds HIV cases were in Africa alone and 27 percent of the worlds Refugees came from Africa, while Africa only contributed to being 10 percent of the world population. If the G8 have been in charge of Education programs in Health; Peace building and conflict management, then the amount of Refugees and bad health alone reflect little progress with government programs to support peace or human development and education in Africa.

Maybe Government leaders need others to help them with their health education and global peace and conflict management programs because something has gone astray from the intention of American Founding Fathers. We as consumers have a right to direct our support to programs and services that can better relate to the Life, Liberty and pursuit of happiness for all people it intends to serve. There are other leading agencies that can lay the foundation that will protect and service the rights of all humans in the future, which are usually non-governmental and have a genuine interest with no strings attached for human service. Governments in the business of Human Rights and protection should carefully review the Declaration of Independence and restructure to effectively champion Life; Liberty and pursuit of happiness for the good of all humanity. The specific target of groups of human beings for genocide or exploitation is a crime against humanity.

For those whose rights are continually and maybe even unintentionally disrespected, a Champion must arise to help open the door for non-governmental agencies to save innocent people and provide some immediate relief. Many will benefit and many more warrant the protection of their human rights, but targeting those in the most distress in a beginning. Every life is precious even though it appears that poor or people in developing countries are taken for granted. This makes it obvious that Governing bodies need assistance with their global peace and development objectives, especially when they try to serve the poor. The wars that exists today in Africa and the Middle East do demonstrate the lack of progress of super powers in protecting human rights and being real champions of peace.

While there is respect for our powerful leaders some guidance is needed in education and social affairs so that meaningful servicing of Human rights can progress. Non-governmental agencies can better support developing peoples with no strings attached.

My name is Dawnis Ba, I have worked within the field of Human Services for over 25 years. I have worked with both Government and non-governmental agencies towards the alleviation of poverty and addressing social service and human rights concerns. I am currently a private resettlement consultant, trainer and specialist: a problem solver for migration and poverty concerns. The World is calling on a real champion. Blood is a terrible thing to Waste and it cries from the ground. Visit http://www.globalhandincorporated.org

Why Should the Government Assist US Auto Manufacturers?

As a lifelong resident of Michigan, I was raised with the belief that we must purchase only those automobiles produced by an American car company (yes, even if some parts were made in foreign countries). To this day, I still hold that belief due to the fact that I find it incomprehensible to allow my own selfish desires to affect the employment outlook of my family members, friends, neighbors, acquaintances and my community as a whole.

Yes, Detroit built its share of lemons in the 70's, 80's and 90's, but quality has much improved since then. Here's an example; I am a self-described car nut, and my enthusiasm happens to get the best of me when that awesome, latest and greatest "wow" car design is introduced. As a result, I don't wait for rebates or incentives; I just go for it as soon as my dream car hits the showroom. The first time I could afford to do so was over ten years ago, when the '97 Ford F150 was introduced. I loved it, leased it and never had a single problem with it. Then came the '99 Chrysler 300M. Again, I leased this beauty and loved driving it. Unfortunately, it was not as trouble-free as my Ford, but it was okay. I figured it still looked good, was fun to drive and the lease would be up soon. So, the next best thing came out, and again it was a Chrysler product, albeit the Dodge line - the 2004 Dodge Durango. I leased this vehicle for four years and didn't want to chance a potential lemon, so I purchased the extended bumper-to-bumper warranty. Of course, I never had to use it; this vehicle was abused by my family, pushing the towing capability to the limits, and during our four-year lease we never once required service. Even at its lease end, this vehicle drove beautifully. So, it is my opinion that Detroit's automakers made a 100% improvement in quality in the short span of just five years, from the late '90's to the year 2004.

Some might wonder why I would have chosen an American car, after recently experiencing problems with a previously leased American car. Well, the answer is simple, my friend. If more people had my attitude, Michigan would not be where it is today. You see, Michigan has been in a recession for five years, and it hurts to know that my decision, combined with all of the others who might choose foreign cars, will deeply affect others.

While I agree that the business model of U.S. auto companies needs drastic change, I also have a clear understanding of what's ahead for the entire country if the government does not lend these manufacturers the necessary funds to see them through this very difficult period; we're living it already here in Michigan, and the rest of the country will experience what we've gone through for several years. Michigan lost 330,000 factory jobs since 1999, and as a result many others have been affected:


My husband is an energy center operator for a manufacturer directly tied to the auto industry. He's been laid off at least five times in as many years, and the threat is always lurking.

My dentist has lost 27% of his business due to the fact that people who don't have insurance simply do not go to the dentist.

My OB/GYN found it necessary to eliminate 20% of her staff - again, because women's "female problems" are placed on the back burner when they don't have insurance and can't afford an office visit.

A close friend has taken a 10% pay cut in order to keep his job. As a result, his home has been in a near-foreclosure status twice within the past year.

My sister, a medical biller, lost two jobs in the last five years due to our economy. She now works two part-time jobs, just trying to make the mortgage payment.

My close friend, a vice-president of the mortgage department for a local bank, lost her job when the bank was absorbed by a larger national bank.

Beautiful neighborhoods are left with abandoned homes because people have had to move just to find work. Of course, there are few people who can afford to buy homes, so these homes sit unoccupied.

Municipalities are eliminating police and fireman jobs because they're not collecting the taxes required to pay the employees' salaries.

School systems are eliminating teachers, resulting in higher class sizes.

My nephew, a packaging engineer, moved to Pennsylvania because there are no such jobs here in Michigan. The affect of our economy is also starting to hit Pennsylvania, and he's not sure if he'll have a job in six months.

The list goes on and on, and the loss of another 2.5 million jobs in this country will be absolutely devastating; entire cities will go bankrupt and recovery will take years. The government didn't waste a moment deciding the fate of AIG, who employs 100,000 people worldwide. Why are they so hesitant to save 2.5 million jobs here in the United States? Probably because they believe auto workers are overpaid - and they are. The UAW needs to voluntarily take a 20% pay cut, and the company executives need to do the same. Perks need to be eliminated, and survival has to be priority number one. Each car company should be required to produce small, fuel efficient vehicles within 18 months of obtaining government assistance, and do everything in their power to develop alternative energy for their vehicles - even if it means joint ventures. Executive greed needs to be a thing of the past; the auto company leaders could learn a thing or two from talking with Lee Iacocca, who generously offered to bring Chrysler back from the brink of bankruptcy for a yearly salary of just $1.00 back in early 1980's. Now, that's a true leader, and a man dedicated to seeing results. Perhaps Steven Feinberg, owner of Cerberus, which purchased Chrysler in 2007, should do a little something to help with the U.S. manufacturing sector, rather than just looking to make a quick profit.

If the auto industry in this country is going to survive, and ultimately keep the United States from entering a depression, everybody needs to give. Consumers need to take a second look at American cars, the UAW members need to take a 20% wage cut, as well as start paying for a portion of their health insurance, and CEOs and executives need to put an end to their greed. And most importantly - the key to the auto companies' survival - the United States government needs to lend the money these companies need so that manufacturing and its jobs remain a vital and stable factor of this nation's economy.

Marie Megge is a consultant in the credit services industry. Over the past several years she has assisted many individuals in resolving their debt-related matters. For more information on Marie's work, visit http://www.DonaldsonWilliams.com

Should I Join a Landlord Association? - UK Landlords

Investors who have recently become landlords as well as those that have been doing it for some time will eventually come across one of the 'trade' associations that claim to represent their interests.

The 3 main landlord bodies that exist in the UK are:

RLA (Residential Landlords Association)

NFRL (National Federation of Residential Landlords)

NLA (National Landlords Association)

What do they do?

Each organisation offers a range of benefits for their members, these include:

* discounts on products such as insurance

* produce a magazine containing articles giving tips and advice

* some provide free forms & tenancy agreements

* campaign and lobby on behalf of landlords with the aim that any legislation is 'landlord friendly'

* some offer training and courses so that landlords are up to date with the latest legislation, practice and procedures

Sounds great where do I sign?

All the above sounds great however the downside to membership is that it is not free. Basic annual membership costs between £75 - 90. In the case of the NLA one of the added attractions is that landlords have access to a telephone advice line. Landlords should not forget that whilst these organisations portray the image of being an organisation working tirelessly for their benefit; they are first and foremost a business. They need to make money to pay their chief executives, fund their rent and cover the expense accounts. They do this partly by levying their membership fee, but also by selling landlords products for which they get commission. In short they are a business not a charity.

Should I join one?

After weighing up the benefits of membership, the big question is should I join one? On the face of it there are very few benefits of being a member that can't be obtained for free elsewhere. Websites such as Property Hawk offer many of the member services offered by these organisations such as ASTs, information and articles without having to pay. We can do this because we do not have to support the costs of expensive offices, chief executives and other corporate paraphernalia. One of the other advertised attractions of membership of these organisations is that they offer specially negotiated deals and rates for members, such as discounted insurance. Again these rates are often nothing different to those provided by other intermediaries. Property Hawk has partnered with Alan Bosewell Insurance Brokers to provide discounted rates which are comparable.

The one useful function that they do provide is the facility to represent the wider interest of landlords. It is undoubtedly true that the associations do play a useful role in lobbying against some of the more draconian and poorly thought out legislation emanating from Government. What is not clear however is how much of their budget they actually spend on it in relation to other expenses such as wages, pension and running costs. I suspect it is relatively small. The Associations also produce a magazine, which contain some useful and interesting content. The question is that is all this worth £75+ per annum; you may think it is and if so you can always offset it against your rental profits for tax purposes.

Which one should I join?

Personally, if I were to choice one to join I would probably go for the NFRL. This is because the NFRL is actually an umbrella organisation for over 40 local branches. When you join your local organisation you will also obtain membership of the national body. Subscriptions are generally cheaper than the national associations. For instance membership of my local branch; the East Midlands Property Owners (EMPO) is currently £55 and this entitles you to a discount of £60 from the HMO licensing fee. Being a member of a local organisation means that you stay tied in to local issues. This is becoming increasingly important as much of the new legislation such as HMO licensing often has to be interpreted by your Local Authority. The thing to be aware of is that the quality of these local groups is variable, depending very much on the time and resources that the voluntary committee can devote to running them. I must add my local group EMPO is very good.

My advice is therefore think very carefully about what you are getting from membership before signing up. It may well be that you are actually paying to keep a load of executives in expensive suits, when in reality most of the benefits they offer can be had for free.

Chris Horne has 20 years experience as a property professional having worked for companies such as English Partnerships and Drivers Jonas as a planning and surveying consultant.

He now works full time as a investor and property developer.

He also has developed the site Property Hawk targeted at UK Landlords it provides FREE Property Management Software.

Property Hawk also includes a mass of Buy to Let targeted information.

propertyhawk.co.uk is the Landlord's Homepage

6 Reasons Why College Football Should Go to a Playoff System

Reason # 1. Obviously, so that we can finally have a clear cut winner, with no speculation. And it's teams that fought hard to get there. Teams that are deserving..not some over weight powerhouse that hasn't played a game in 2 months because they don't play a conference championship.

Reason # 2. It would give more deserving conferences like the SEC and the Big12 a chance to get in. Thus insuring a exciting game. No more blow outs!

Reason # 3. It's what the fans want. President elect Barrack Obama even said a 8 game playoff system has been long over due in college football. Let's give the people what they want!

Reason # 4. Nobody cares about the outback bowl. Nobody cares about any of the bowls other than the BCS bowls and the title game is the only real tv draw on a weeknight. You bring in this playoff system and suddenly it's March Madness in December. What's more exciting then a bracket with these 8 teams in it. Florida, USC, Texas Tech, Georgia , Alabama, Oklahoma, Texas, Oklahoma ST. I wouldn't put Penn ST. or Mizz on there but for you fans,it could happen. Then,think of the action that a 16 game system would produce. The Sweet Sixteen has never been seen like this...

Reason # 5. I'm sick of all the talking. Let's put this to rest. No more will there be some under achiever that achieved over crying for a piece of the title. No more "co. champions." Not that there ever was really. To my recollection they only give out one crystal ball each year. Still,I am sick of the chatter. I want to see some action.

Reason # 6. I'm sick of hearing Pete Carrol cry about how his team deserves a shot. I want to see USC take on a real team.Not one of these mediocre teams that seem to throw a monkey wrench in the National title implications for USC every year, but a real team, with a real defense. I guess that doesn't take care of Pete Carrol's crying though,because after a thrashing from UG or UF. USC will finally be seen as they are. And not the greatest team in college football.

b-rad from the boot signing off

[http://bradfromtheboot.com]

Credit-Related Life Insurance - Should You Buy It?

Credit insurance is one of the most misunderstood and fraudulently marketed products in the field of personal finance. The types of insurance sold by creditors to debtors range from the old standard credit life and accident and sickness insurance to such worthless contracts as "life events" which will be explained below. Almost all of these policies are grossly overpriced and are a source of substantial profits for lenders and sales finance companies.

The use of insurance as a type of security for a loan or other extension of credit is not an inherently a bad choice. Both the creditor and the debtor can benefit from removing the risk of death or disability from the equation. If the reduced risk is a factor in providing a lower interest rate, or in basic credit approval, it can be a win-win situation. The problem arises, however, when the creditor intimidates or otherwise induces a customer to purchase an insurance product not for its effect on risk but as an additional and substantial source of revenue.

Normally insurance rates are set by the competitive market, which tends to hold rates down at least for the reasonably informed consumer who does some comparison shopping. Automobile insurance companies, for example, are highly competitive and the rates are seldom regulated. But in the context of an application for credit there may be no competition at the point of sale of the insurance. The creditor may be the only practicable source. The only "competition" is between insurance companies to see who can charge the highest premium and pay the highest commission to the creditor or its officers for selling the coverage. This tends to force rates up rather than down and has been dubbed "reverse competition".

During the 1950s as consumer credit was expanding rapidly and many states had strict usury laws (laws limiting maximum finance charge rates) both lenders and sellers began relying on commissions from credit insurance premiums to pad the bottom line profits. Many engaged in selling excessive coverage (not needed to pay the debt if something happened to the debtor) and nearly all charged outrageous premiums, with 50% or more being paid to the creditor or its employees, officers or directors as "commissions" for writing the coverage. As incentives for paying as few claims as possible there were also "experience refunds" awarded to creditors, which sometimes raised the total compensation to 70% or more of the premiums. In addition, the premium was added to the loan or unpaid balance of the sale price and finance charges were charged on the premium.

Finally the National Association of Insurance Commissioners (NAIC) declared it had had enough of the consumer abuse and model legislation was drawn up and passed in nearly every state authorizing insurance commissioners to limit the amount and cost of credit life and accident and sickness insurance...the two biggest sellers in the field. In some jurisdictions the legislation had very little effect because the commissioners would not seriously exercise their new regulatory powers, but in others the rates came down almost immediately. Over a number of years where there was pressure from consumer groups the rates on these two products reached a reasonable level...with some states requiring that the rates produce a 50 or 60 per cent "loss ratio"....ratio of incurred claims to earned premiums....and limiting commission payments to creditors.

While this progress helped the consumer buying credit life and accident and sickness insurance creditors soon realized that it was easy to develop new products which were not regulated under the NAIC model law...products such as "involuntary unemployment insurance" to protect the consumer against job loss and "unpaid family leave" insurance to make payments in the event of a family emergency that required the debtor to have to leave his job temporarily.

Now, back to the question of whether you should purchase credit related insurance in connection with your next transaction, that really depends on the type of transactions, your individual circumstances and the kind of coverage in question. The first question to answer before deciding who to buy credit life insurance from is whether you need life insurance at all. The first step in the answer is "Do I already have life insurance in sufficient amount to cover this obligation and other needs?" If so it is obvious you don't need any more, and the answer should be "No".

Life insurance is justified when (a) there are dependents to be cared for after you are gone; (b) you have a moral obligation to a co-signer or co-maker or guarantor...possibly a family member...that you will pay at least your portion of an obligation, living or dead; (c) you own property or other assets which you want to leave to someone upon your demise, and unless this debt is otherwise paid the property may have to be sold to pay it; (d) you are buying something important "on time", such as a home or an expensive vehicle, and don't want it to be foreclosed or repossessed if you are not there to make the payments; or (e) you and a partner have invested heavily in a business that depends on both of you working, and you don't want your partner to suffer a hardship if you are not there. There may be other reasons, but the point is that you must examine your individual circumstances.

You do NOT need life insurance if you have no dependents, own very little and are not leaving anything to anyone, and there is no co-maker to protect, because your debts essentially die with you. No one will have to pay them if you don't. And if there is no money to bury or cremate your remains don't worry. Something will be done with them because public health requires it. If you want an expensive send-off buy just enough to pay for the funeral and name a beneficiary with instructions to use it for that purpose so your creditors won't try to grab it.

If you want to make gifts to others when you die, perhaps to make up for the mistreatment of them while you were around, life insurance is a very expensive "estate substitute". It is better to put your money into savings than to pay it to some national insurance corporation on the hope that you will profit by dying. With life insurance you are essentially betting that you will die and the insurer is betting you won't.

Assuming you decide you need life insurance, the next question is whether to buy it from a creditor or on the open competitive market. Most of the time it is best to purchase a proper amount of term life insurance payable either to a beneficiary, or to a trust for the benefit of minor dependents, or to your estate to be used to pay your last rites and obligations. If you have it paid to a beneficiary, such as your spouse or children, your creditors cannot claim it for the payment of your bills....unless you designate a particular creditor as a beneficiary to the extent of your debt obligation. No creditor has an insurable interest in your life except to the extent of your debt.

If you owe a mortgage debt on your home it may be wise to scale your term life policy to approximate the amount of your mortgage so it will be paid off for the benefit of your spouse and children if you, a provider, cannot provide. If you have a car note you need to adjust your total life insurance amount to discharge that obligation as well, so that whoever gets the car gets it free and clear. If you don't care what happens to the vehicle don't worry about the additional coverage. The creditor will take it and sell it and eat the balance. It is theoretically possible for a sales finance creditor to sue an estate for a deficiency after repossession but it very seldom occurs. It's just too much trouble.

Aside from large obligations such as home mortgages and car notes there is usually very little justification for buying life insurance, and certainly not from a creditor. The premium rates on creditor-provided life insurance are much higher, as a general rule, than the rates for other life coverage.

Credit life insurance comes in three varieties...level, decreasing, and revolving. Level life insurance begins and ends with the same coverage over the term and is normally associated with single payment obligations. It is illegal in most states to sell level life insurance on installment transactions. Decreasing credit life comes in two sub-varieties...gross and net. Gross decreasing credit life begins with the "total of payments" (the principal plus all interest you will probably have to pay over the whole term of debt) and decreases by one monthly payment each month until it reaches zero at the end of the term. Net decreasing credit life starts at the "amount financed" and declines as the principal balance declines over the term. Usually net decreasing life is enough to pay the obligation because it tracks the remaining principal, unless you fail to keep up with the payment schedule and reduce the debt accordingly. Gross decreasing life will normally be excessive at the beginning and less so as the term continues. For example, if the principal is $10,000 and there will be $4000 in finance charges on a car note over a six-year term, the insurance will start at $14,000, but during the first month the debtor in fact only owes $10,000 plus a few days interest. This means that if the debtor dies during the term the excess coverage should be paid either to the debtor's estate or to a named beneficiary. In some states creditors are limited to net decreasing life plus three or four months of payments just in case the account is in arrears at the time of death.

Auto accident deaths create a unique insurance situation where credit life is involved because the casualty insurance on the vehicle will often pay off the car note leaving the credit life insurance to be paid directly to the debtor's estate as a cash benefit. Millions of dollars of insurance benefits have been lost because the surviving spouse was unaware of the double coverage on the note.

"Revolving account" credit life insurance usually involves a monthly premium computed on the basis of the outstanding balance being billed. The premium covers that amount for 30 days, discharging the obligation if death occurs before the next billing date.

Unfortunately, national banks that issue credit cards have developed a scam to get around the accusation of illegally high credit life premiums. Most of them if pressed would take the position that since they are a "national" bank the states cannot limit their insurance premiums, even if the state also limits premiums charged by state banks, but this legal position stands on shaky ground.

Many have issued their own policies in the form of "debt cancellation clauses" which are amendments to credit card agreements under which the account balance will be canceled if the debtor dies. But because of the risk that some state may clamp down on their rate-setting practices they "bundle" the credit life with up to a dozen other coverages, nearly all of which are not rate-regulated, so the charges produce a very large margin of profit. They won't sell credit life alone, but require an "all or none" purchase of the various components such as credit accident and sickness, involuntary unemployment coverage, unpaid family leave coverage and even such weird products as "college graduation", "having a baby", "retirement", "divorce" and other "life events", each of which results in a month or two of benefits at the minimum payment level on the account. These bundled products usually cost upward of $1.00 per $100 per month, or twelve per cent per annum on top of the existing finance charge rate. Truth in Lending does not require that additional 12% to be reflected in the annual percentage rate, however, because the coverage is deemed "voluntary" and not part of the "finance charge".

So the answer to the initial question is a resounding "maybe"...depending on your individual circumstances, the options available to you, and the cost of each alternative. Perhaps having read this you will know what questions to ask and make an informed choice.

Sidney L. Moore Jr. is a retired consumer credit attorney who has handled many thousands of consumer defenses and claims against creditors. He holds a Master of Laws degree and was in practice for more than 40 years. He now specializes in consumer class actions against credit-granting institutions. His cases have resulted in millions of dollars being paid to non-profit organizations by creditors, in addition to millions in refunds to customers. He is a member of the National Association of Consumer Advocates (NACA) and a frequent lecturer on consumer credit issues in lawyer-training events. He may be reached by e-mail at attnys@windstream.net.