You probably have received the same email I have about the carrot, egg and coffee. It is a little inspirational message about the way three different things respond to a harsh environment; the responses tell us something about how we might react to difficulties in our lives. Here’s how the story goes:
A woman sets three pots of water boiling on a stove. She puts a carrot in one pot, an egg in the other, and coffee grounds in the third. She lets each boil for 20 minutes. Then she turns off the heat and assesses each. The carrot has become completely mushy and the egg has hardened. The coffee grounds haven’t changed much, but the hot water has become delicious coffee.
How does this apply to life? Well, when surrounded by a harsh environment – say a difficult situation at work, or bickering at home, or big-time pressure at school – do you react like the carrot, the egg or the coffee? Do you let the situation overwhelm you so that you turn to mush, like the carrot? Or does the situation harden your interior, as it does the egg? Or are you like the coffee, which transforms the environment instead of letting the environment transform it?
Yeah, I want to be like the coffee.
As I thought about it, this little story is just another way to say what Paul Bremer was saying in my March 14 post. If you go back and read that, you see that his second tip for successful management includes an explanation that says: “Your example should show people how to master events and not let events master them.” We’ve all seen managers who become completely frazzled by unexpected events, customer pressure, financial stresses or other difficult circumstances. This is never impressive. What is impressive is to see someone go into a difficult situation and transform it with their hard work, sincerity, diligence, competence and perhaps innovation. I’ve seen that far fewer times, but when I have, it has been impressive. According to Bremer, this is what good leaders should do all the time.
Christ, of course, sets the most impressive example. Remember when John baptizes Jesus in the Jordan? Students of the Bible love to discuss the question of why Jesus was baptized. Certainly, He didn’t need baptism the same way everyone else does. Maybe the answer is something like the coffee. Jesus wasn’t transformed by the water the way most of the people being baptized were; the water was transformed by Jesus. By entering into the river, Jesus made the Jordan living water, from which God’s grace would forever flow through this sacrament of initiation.
Prior to getting that email, and prior to hearing Bremer speak, I never thought about the baptism of our Lord as setting an example that could be valuable to me in the workplace. But now I see that it is a powerful example. While none of us can change anything to the extent that God can, we can make the world a better place. If even a handful of coffee grounds can follow the example of Christ, then so can I. We are not supposed to cave into our environment; we are not supposed to be hardened by our situation. I am convinced that we are supposed to go out and transform the world, making it better every day.
Wednesday, March 30, 2005
Wednesday, March 23, 2005
The Aging of America: Midwest will be particularly hard hit
The debate over Social Security reform has shined the spotlight on the demographic realities of our country. We’ve all heard the facts:
*) In 1950, there were 16 workers for every Social Security beneficiary; today there are three workers for every beneficiary.
*) The first of the baby boomers (those born between 1946 and 1964) will retire in 2008. The number of people entering the workforce will not keep pace with those retiring.
*) By 2040, there will be just two workers for every Social Security beneficiary.
*) In general, people are living longer and retiring earlier.
The “aging of America” will affect everyone, particularly the Upper Midwest, which has a higher-than-average proportion of the aged population.
The Unites States Census reports there were 35 million people in the year 2000 who were 65 years old or older, a figure that represents a 12 percent increase in the over-65 population from 1990. However, the overall population grew as well in the 1990s, so while the over-65 group made up 12.4 percent of the total population in the United States in 2000, that’s actually a smaller percentage than the 12.6 percent that group made up in 1990.
In the 1990s, the oldest of the older generation saw their ranks swell. The population 85 years and older increased by 38 percent, from 3.1 million in 1990 to 4.2 million in 2000. The 75 to 84 crowd grew by 23 percent, and the population 65 to 74 grew by just 2 percent.
During the 1990s, the portion of the population over 65 in the Midwest stayed relatively stable, representing 13 percent of the population in 1990, and 12.8 percent in 2000. However, certain counties in the Midwest saw high concentration levels of seniors. The Census Bureau reports that the Midwest has more counties that have senior populations exceeding the national average than any other region. Eighty-two percent of the Midwest’s 1,055 counties have a senior population larger than the 12.4 percent average for the country. States such as Nebraska, Iowa and North Dakota are particularly gentrified, with more than 90 percent of the counties in those states hosting senior populations larger than the national average. North Dakota has more people older than 85 per capita than any other state. South Dakota and Iowa have the highest percentages of people 100 years old or older (1 out of 3,056 people in South Dakota, and 1 out of 3,110 in Iowa).
The demographic age wave is rolling toward the Midwest and some say it may swamp the region if careful planning doesn’t take place now. Consider that about 76 million baby boomers are expected to retire between 2008 and 2030. This means that the country will have about twice as many people over the age of 65 as it does now, but fewer people working. There are only 48 million people in Generation X, the group of workers behind the boomers. And even if you add the youngest workers, who constitute Generation Y, you don’t come up with enough people to replace all the expected retirees.
In Minnesota, for example, the over-65 population is expected to grow by 117 percent between now and 2030. By then, 21 percent of Minnesota’s residents are expected to be older than 65 compared to 12 percent today. South Dakota expects is senior population to increase by 66 percent by 2020. By 2025, one University of South Dakota researcher expects 25 percent of the state’s population to be over 65. North Dakota, already considered to host the country’s fifth-oldest population, will see its over-65 population segment grow from 14.7 percent of total state population today to 23 percent by 2020.
Given the current media buzz, we have heard a lot about the impact of the changing demographics on Social Security. Beginning in 2018, the amount of taxes collected for Social Security from the labor force will not cover the benefits paid. The existing trust fund will be depleted –- by 2027 it will exhaust the interest it collects on its Treasury bonds, and by 2042 the bonds themselves will all have been redeemed.
Social Security, however, is only one concern. Equally pressing, or even more so, is the condition of the nation’s Medicare and Medicaid programs. Expenditures for these two programs currently constitute about 3.4 percent of the country’s Gross Domestic Product. The Congressional Budget Office estimates that expenses will grow to equal 8 percent of GDP by 2030, and to as much at 15 percent by 2075. CBO made these projects prior to 2003 reforms, which will increase costs even more.
The Fed Gazette, a publication of the Minneapolis Federal Reserve Bank, recently cited a Minnesota Department of Health analysis that said one in 10 people of baby boomer years are hospitalized in a given year. For those 65 to 74 years old, the rate is three in 10, and for those over 85, it is six in 10. The analysis predicts a 56 percent increase in hospitalizations over the next 30 years -– over half of the increase due to the state’s aging population.
Such developments will have a real impact on states and taxpayers. Medicare, (a federal health care program for the elderly) is funded entirely at the national level, but Medicaid, (a federal health care program for poor, disabled and indigent elderly) is partially funded by states. The federal government pays about 57 percent of Medicaid expenses, leaving the rest to the states. Medicaid accounted for 21.4 percent of total state spending in fiscal 2003, or about $122 billion. Across the country, more than 50 million low-income people receive assistance through Medicaid. And the enrollment is growing. Enrollment increased 8.8 percent in fiscal 2003, and was estimated to grow another 5.5 percent in fiscal 2004.
The National Association of State Budget Officers reports that Illinois was projected to spend $5.5 billion for Medicaid in fiscal 2004, or 28.1 percent of its total budget. Indiana was set to spend $1.52 billion, or 21.6 percent of its budget. It’s a major expense in all states, even though some states have reduced their expenditures. Iowa reduced its Medicaid spending from $1.17 billion in 2002 or 20.4 percent of its budget, to $795 million in fiscal 2004, but that’s still 15.6 percent of its budget.
These are just some of the numbers that begin to tell the story of a population that is increasingly aging. The fact that more people are living longer in the United States is not new; we’ve seen this coming for decades. The real story will unfold in the decades ahead as people adapt to new paradigms surrounding retirement and health care.
Friday, March 18, 2005
Old Testament brings meaning to Palm Sunday
The 20th of March is Palm Sunday in my church, a feast I recall commemorating as early as my childhood years. We would get palm branches to hold during Sunday Mass, but until recently that was the extent of my understanding of this important day in the liturgical calendar. With some study, I have learned a little about the significance of this day and I appreciate this opportunity to share that knowledge.
Palm Sunday, of course, is the beginning of Holy Week – the week that includes the Last Supper of our Lord and His crucifixion. One week after Palm Sunday, we celebrate Easter, commemorating Christ’s great triumph over death in resurrection from the cross. Luke 19:28-38 describes Jesus’ entry into Jerusalem, which we remember on Palm Sunday. Riding on the back of a donkey, He is praised by the crowds: “Blessed is the king who comes in the name of the Lord.” The remainder of Luke’s Gospel presents the story of Christ’s crucifixion and resurrection.
In order to really get some perspective on what is happening, go back to Exodus 12:1-20, where God describes to Moses and Aaron the first Passover. God explains that in order for the chosen people to be saved, a lamb must be slaughtered. In fact, the chosen people must eat the lamb. God says a lamb is to be selected on the 10th day of the month of “Nisan,” which translates roughly to our springtime today. The lamb is to be inspected; four days later, after the lamb has been determined to “be without blemish” (Ex 12:5), it is to be slaughtered in the evening twilight with the whole assembly of Israel present, (Ex 12:6). At Exodus 12:22, Moses instructs people to take a hyssop branch, dip it in the blood of the lamb, and apply the blood to their doorposts; the angel of death passes over the homes so marked. They are literally saved by the blood of the lamb.
Now, fast-forward to the New Testament and it becomes apparent that Christ is the fulfillment of the Passover. The nativity stories of Christ, which we celebrate at Christmas, tell us that Christ is born in a stable at Bethlehem, which is just outside Jerusalem. By the time of Christ, faithful Jews would come to Jerusalem for the annual Passover ritual. Flocks of sheep would be kept near Bethlehem, precisely for the purpose of eating lamb at Passover. Sheep are outdoor animals; the only time they come indoors is to give birth. The stable where Jesus was born was a place for the sheep in the sacrificial flock to give birth.
Thirty years after the birth of Christ, John the Baptist sees Jesus at the Jordan River and exclaims: “Behold the Lamb of God,” (John 1:29).
Palm Sunday is the day the shepherds would march the sheep from Bethlehem into Jerusalem so people could select the one they want for their Passover meal. Jesus rides into town on a donkey on that same day. That is partly why there were crowds of people in the street to greet Him. The Jews would buy a lamb, and over four days inspect it before slaughtering it so they could eat it on Passover. Soon after entering Jerusalem, Jesus is arrested and questioned at length by Pilot, who declares Him innocent. It has been about four days since Jesus entered Jerusalem, and Pilot declares “I find no guilt in him” (John 18:38). The Lamb is declared to be without blemish, as the Passover ritual requires. Then, in the evening twilight, He is crucified -- slaughtered before crowds of people. While Jesus is hanging on the cross, a soldier offers Jesus vinegar to drink by soaking a sponge on a hyssop branch and raising it to His mouth.
Christians are saved by the blood of Christ, as the Israelites were saved by the blood of the lamb. And just as the Israelites were to eat the Lamb, we are to eat of the Body of Christ, the new Lamb (see John 6:52-59).
Clearly, the Passover, the nativity, the resurrection and the Eucharist are all part of the same story. And we are given a hint about that as early as the Book of Genesis. The 22nd chapter of Genesis describes the famous story where God commands Abraham to sacrifice his only son, Isaac, on the top of the mountain. Isaac doesn’t understand what is happening, but Abraham must understand the whole picture very clearly. As the two of them are ascending the mountain -- Isaac with the wood on his back for the offering -- Isaac asks his father: “Here are the fire and the wood, but where is the sheep for the holocaust?” (Gen 22:7). Abraham answers: “God himself will provide the sheep for the holocaust.”
You know the conclusion of the story: At the top of the mountain, God relieves Abraham of the requirement to kill his son. Instead, they see a ram caught in the thicket and slaughter the wild animal instead. Note that it is a ram, not a lamb. God doesn’t provide the Lamb until the New Testament, and that is what we celebrate on Palm Sunday, riding triumphantly into Jerusalem.
Palm Sunday, of course, is the beginning of Holy Week – the week that includes the Last Supper of our Lord and His crucifixion. One week after Palm Sunday, we celebrate Easter, commemorating Christ’s great triumph over death in resurrection from the cross. Luke 19:28-38 describes Jesus’ entry into Jerusalem, which we remember on Palm Sunday. Riding on the back of a donkey, He is praised by the crowds: “Blessed is the king who comes in the name of the Lord.” The remainder of Luke’s Gospel presents the story of Christ’s crucifixion and resurrection.
In order to really get some perspective on what is happening, go back to Exodus 12:1-20, where God describes to Moses and Aaron the first Passover. God explains that in order for the chosen people to be saved, a lamb must be slaughtered. In fact, the chosen people must eat the lamb. God says a lamb is to be selected on the 10th day of the month of “Nisan,” which translates roughly to our springtime today. The lamb is to be inspected; four days later, after the lamb has been determined to “be without blemish” (Ex 12:5), it is to be slaughtered in the evening twilight with the whole assembly of Israel present, (Ex 12:6). At Exodus 12:22, Moses instructs people to take a hyssop branch, dip it in the blood of the lamb, and apply the blood to their doorposts; the angel of death passes over the homes so marked. They are literally saved by the blood of the lamb.
Now, fast-forward to the New Testament and it becomes apparent that Christ is the fulfillment of the Passover. The nativity stories of Christ, which we celebrate at Christmas, tell us that Christ is born in a stable at Bethlehem, which is just outside Jerusalem. By the time of Christ, faithful Jews would come to Jerusalem for the annual Passover ritual. Flocks of sheep would be kept near Bethlehem, precisely for the purpose of eating lamb at Passover. Sheep are outdoor animals; the only time they come indoors is to give birth. The stable where Jesus was born was a place for the sheep in the sacrificial flock to give birth.
Thirty years after the birth of Christ, John the Baptist sees Jesus at the Jordan River and exclaims: “Behold the Lamb of God,” (John 1:29).
Palm Sunday is the day the shepherds would march the sheep from Bethlehem into Jerusalem so people could select the one they want for their Passover meal. Jesus rides into town on a donkey on that same day. That is partly why there were crowds of people in the street to greet Him. The Jews would buy a lamb, and over four days inspect it before slaughtering it so they could eat it on Passover. Soon after entering Jerusalem, Jesus is arrested and questioned at length by Pilot, who declares Him innocent. It has been about four days since Jesus entered Jerusalem, and Pilot declares “I find no guilt in him” (John 18:38). The Lamb is declared to be without blemish, as the Passover ritual requires. Then, in the evening twilight, He is crucified -- slaughtered before crowds of people. While Jesus is hanging on the cross, a soldier offers Jesus vinegar to drink by soaking a sponge on a hyssop branch and raising it to His mouth.
Christians are saved by the blood of Christ, as the Israelites were saved by the blood of the lamb. And just as the Israelites were to eat the Lamb, we are to eat of the Body of Christ, the new Lamb (see John 6:52-59).
Clearly, the Passover, the nativity, the resurrection and the Eucharist are all part of the same story. And we are given a hint about that as early as the Book of Genesis. The 22nd chapter of Genesis describes the famous story where God commands Abraham to sacrifice his only son, Isaac, on the top of the mountain. Isaac doesn’t understand what is happening, but Abraham must understand the whole picture very clearly. As the two of them are ascending the mountain -- Isaac with the wood on his back for the offering -- Isaac asks his father: “Here are the fire and the wood, but where is the sheep for the holocaust?” (Gen 22:7). Abraham answers: “God himself will provide the sheep for the holocaust.”
You know the conclusion of the story: At the top of the mountain, God relieves Abraham of the requirement to kill his son. Instead, they see a ram caught in the thicket and slaughter the wild animal instead. Note that it is a ram, not a lamb. God doesn’t provide the Lamb until the New Testament, and that is what we celebrate on Palm Sunday, riding triumphantly into Jerusalem.
Monday, March 14, 2005
Bremer shares thoughts on leadership
Former U.S. Envoy to Iraq L. Paul Bremer spoke to another group I covered for NorthWestern Financial Review magazine, this time on March 12 in San Antonio, Texas. He delivered largely the same message I reported in my last post, but he added some personal thoughts on leadership. I thought they are worth sharing.
These are what he called “Eight Steps to Successful Leadership.”
Set a vision and communicate it relentlessly. “People need to know how their work relates to the bigger picture,” he said. “People need to see that their work is bigger than themselves.”
Set an example. Create a sense of urgency, he said. Furthermore, he said your example should show people how to master events and not let events master them.
Set clear priorities and goals. “A vision is not enough,” he said.
Be decisive. He encouraged people to make “skillful and energetic actions.” He told his audience that good leaders need to “find the right balance between speed and deliberation.”
Be flexible. Adaptability is important, he said. Good leaders are masters at what Bremer called “responsible risk-taking.”
Delegate and hold people responsible. “Leverage the strengths of your organization,” he said.
Give credit to your colleagues; loyalty is a two-way street. “Acknowledge the sacrifices people make,” he said. “It is impossible to over-do this.”
Keep your perspective. He said people do this in three ways: by cultivating a good understanding of yourself; by allowing time for reflection about what you are going, and by pacing yourself.
Monday, March 07, 2005
Speech by former Envoy to Iraq clarifies U.S. approach to terrorism
I remember where I was the day those airplanes brought the Twin Towers down on September 11. I am sure you do to. It is a point in time that every American of my generation will remember for the rest of their lives. The country changed on that day.
The political response has been impossible to miss: stopping terrorism has become our top priority, homeland security became serious business and our military removed the long-standing political regime in Iraq. It is not always easy for ordinary citizens such as me to understand all the connections, to get a handle on the scope of our challenge, to comprehend the motivation of people who would lash out at our country.
L. Paul Bremer III, the former U.S. Envoy to Iraq, spoke to a business group in Phoenix on President’s Day. He described the United States’ response to the terrorist attacks, including its activities in Iraq. Bremer served as the administrator of the Coalition Provisional Authority beginning May 6, 2003. He completed his work on June 28, 2004 when he handed over power to the interim government of Iraq. I found it extremely interesting to get an hour-long presentation on terrorism and Iraq from someone who has been on the front lines. I liked getting the story straight from someone who knows, without the filter of editors. I can make my own allowances for what I suspect to be Bremer’s political leanings.
Bremer knows a thing or two about international affairs. During a 23-year State Department career, he served as special assistant or executive assistant to six secretaries of state. He worked in the U.S. embassies in Afghanistan and Malawi, and as deputy chief of mission at the American Embassy in Norway. President Reagan named him ambassador to the Netherlands in 1983, where he worked for three years.
He also has a lot of experience dealing with terrorism. He was President Reagan’s ambassador at large for counter-terrorism. In 1999, he was appointed chairman of the National Commission on Terrorism. In June 2002, President Bush named him to his Homeland Security Advisory Council.
What follows are excerpts from Bremer’s February 21 speech:
I was shocked by what happened on September 11, but not actually surprised by it. The reason was I had served as chairman of the National Committee on Terrorism. We had reported to President Clinton and to Congress and the American people more than 15 months before September 11 that we should expect terrorists to conduct mass casualty attacks on American soil, on a Pearl Harbor scale. This was a bi-partisan commission. We were not that smart, we just cited the evidence. And the evidence suggested that we faced a new kind of terrorist attack.
What we found was a different kind of terrorism appeared in the early 1990s. If you look at the terrorism we fought in the 1960s, 1970s and 1980s, terrorism then is what I would call “old style terrorism.” They used terrorism as a way of attracting attention to their cause, which they thought had broad appeal. So they would kill a few people in order to get the press to come to the site and then they would issue some statement drawing attention to their cause. They didn’t want to kill a lot of people because they were afraid if they did they would turn off public support… They didn’t want to get caught, they didn’t want to die, and they didn’t want to kill an awful lot of people.
We on the National Commission of Terrorism found three trends in the 1990s that told us something new was afoot. First of all, we noticed that in the 1990s, the number of terrorist incidents was declining but the number of casualties was rising. Second, there was a dramatic increase in the 1990s of suicide attacks. They had been almost unknown in the 1970s and 1980s. And third, the states that the American government identified as supporting terrorists were involved in research of weapons of mass destruction. That meant that terrorists could get their hands on those things – nuclear, radiological and biological weapons.
And indeed, it suggested new motives on the part of the terrorists. What do we know about those folks? Actually we know quite a lot because they have spoken very openly. You can study their statements, their fatwas, their press conferences. Now you can study their web sites.
Basically, they are driven by a view that Islam is necessarily at war with the West. And that they must, as a duty, convert or kill all non-Muslims. They are very frank about this. They are motivated by a burning hatred of the West. Not just the superficialities of the West -- our newspapers, our television shows and our movies -- but by the very foundations of the West: universal suffrage, separation of church and state, women’s education, and above all, democracy. These are the things they very clearly state they hate and are against. And they seek not modest change, but basically world changing revolution. And they very dearly want to kill us by the thousands or by the tens of thousands.
People forget that there was a first World Trade Center attack in February of 1993. And we caught a number of the terrorists and they have since confessed that their objective was to topple the two towers together. Their objective was to kill 250,000 Americans.
What’s the root cause of terrorism? Can’t we deal with the root cause? Ladies and gentlemen, the root cause of these terrorists -- these extremists -- is nothing less than our existence and our success.
What creates that kind of hatred? I don’t know; one thing for sure is it is not poverty. The 19 young men who flew those planes into the World Trade Center, into the Pentagon and in Pennsylvania were, every one of them, well educated, upper middle class Arabs, mostly from Saudi Arabia. Osama bin Laden, who headed al Qaeda, his main theologian is a well-educated Egyptian doctor. These are not poor people. Bernard Lewis, who is professor emeritus at Princeton University, one of the country’s leading observers of the Islamic world, believes a lot of this hatred comes from self-hatred. It comes from the realization that in the last 300 years Islamic countries have had failure after failure, and have not been able to reconcile Islam with the modern world.
These new terrorists are prepared to die for their cause and we have to take them just as seriously. We have got to develop a robust strategy to deal with this.
President Bush has said that the war of liberation in Iraq is related to the war on terrorism. And he is right.
First of all, American administrations from both parties for more than 20 years have identified Iraq as a state that supports terrorism. And the reasons are very clear. Under Saddam Hussein, Iraq supported Palestinian terrorists. He gave safe refuge to notorious characters. His government supported Iranian terrorist groups. The bi-partisan 9-11 Commission reported in the fall there was clear evidence of a connection between Saddam’s government and members of al Qaeda throughout the 1990s.
Moreover, it was the stated policy of the American government, supported by both parties, both Houses of Congress, and signed into law by a Democrat president, to seek regime change in Iraq. Therefore, in early 2003, after Iraq had been found to be in violation of 17 U.N. resolutions dealing with WMD, after the intelligence services of the U.S., Britain, France, Russia, Germany, and others, I think it was correct for the president to conclude that the status quo was not sustainable. Sanctions were weakening. The time had come for action.
So when I left for Iraq in May 2003, I had no doubt that this war was related to the war on terrorism…
What kind of situation did we find on the ground? First of all, let’s talk about the evidence of Saddam’s brutality, which was everywhere. People forget that Saddam modeled his society on Hitler. He says so in his biography. He admired the way Hitler and Stalin were able to control their society. Mein Kampf was required reading in Saddam’s intelligence services.
About a week after I got there, I visited the first of the mass graves in a town called Hillah, about 50 miles south of Baghdad. You might remember that after the 1991 uprising in the south, the Shi'a rose up. Saddam sent in his army into the Shi'a town south of Baghdad. They picked up men, women and children, put them on flatbed trucks, took them out to open fields and machine-gunned them down, and threw them into open pits. This site that I visited at Hillah was about three times the size of a football field. And it was covered with little clumps of bones. All over there were people scrambling to see if they could find some evidence, a piece of clothing, an ID card, jewelry, that would identify the bones of a relative. We estimated that there were 20,000 to 30,000 bodies in this grave alone. By the time I left 14 months later, we found over 100 mass graves in Iraq. Human Rights Watch estimates that Saddam killed over 300,000 of his fellow citizens while he was in power. No one will ever know how many he killed. There are more than one million Iraqis still missing.
I also visited the police stations; every police station had a torcher chamber. Most of them had rape rooms, including the Baghdad central police station. I visited a town in the Kurdish region called Halabja, up in the north, on the east border with Iran. One day in March 1988, Saddam used chemical weapons on his own people, killing 5,000.
When it is safe, I challenge you to go to Iraq and visit the mass graves, look at the torcher chambers, talk to some of the survivors of the rape rooms. Go up and see the 5,000 tombstones in Halabja. I guarantee after you see those things you will conclude as I have that we did a noble thing liberating the people of Iraq.
The collapse of the government in Iraq is one of the most dramatic and abrupt in recent history. It was very different from what happened in the Soviet Union, and Eastern Europe where the change really took place over about a 20-year period. In Iraq, it happened in three short weeks.
It was clear when we got over there that we needed action in three areas: We needed to get the economy going. We needed to start the process of political reform, and of course, we had to deal with the security situation.
The economy was a wreck. Saddam combined the worst features of corruption with socialism and its unbounded faith in bureaucrats. The result was that over a period of almost 30 years there was a really spectacular misallocation of capital. Between 1979 and 2002, the World Bank found that Iraq’s per capita GDP dropped more than any country in the world. In the decade of the 1990s, when Saddam was arguing for the sanctions to be lifted, he cut health care spending by 90 percent, so that by 2002 Iraq had the shortest life expectancy and the highest infant mortality rate of any country in the region.
Even in the wonderful land between the waters in Mesopotamia, there was a water crisis. The U.N. estimated that every day tons of untreated sewage was being dropped into the Tigris and Euphrates Rivers.
Almost all of Iraq’s state-owned enterprises were bankrupt. The banking system was bankrupt. There were state-owned banks that made loans on political dictates, not according to the markets.
We had a budget crisis, the size of which was not that clear to us because under Saddam, the budget was a state secret. We found to our surprise that only 8 percent of the national budget was actually spent by the ministries; 92 percent was spent directly out of the presidency, by Saddam. We knew we were going to go broke by the end of 2003. The consequences of fiscal indiscipline were dramatic. Saddam had simply run his printing presses throughout the 1990s to cover his deficits. His people told us that at the end of 2002, inflation was running at the rate of 115,000 percent. We faced a challenge as great as the challenge the United States faced in the Depression.
I decided we needed to move economically on two dimensions. We needed to get consumption going quickly. And we needed to start longer-term reform, and to put reasonable macro-economic policies in place. Getting the economy going was tough. We had unemployment of about 50 percent. But, we the government were the largest employer. We could find no good payroll records in any of the ministries. The pay system was all over the place. There were special systems, under the table payments, bribes, kickbacks, all kinds of things. We cut through it very quickly. Within a week of arriving, I mandated a four-grade pay scale, and subsequently put in a more sophisticated 13-grade pay system, which we did in August. That wasn’t so easy because we had no banking system, so we had to pay in cash, by hand. Our payroll was about $200 million a month, including pensions. This money had to be transported around the country while the war was going on.
I also knew that we had to create jobs and I immediately allocated hundreds of millions of dollars of the Iraqi budget to new WPA-like public works programs. We were able to create several hundred thousand jobs in the first few months.
We also needed to start the longer-term process of starting macro-economic reform. Within 90 days, we had established a regime of open tariffs; we got rid of Saddam’s tax on foreign investment to encourage outside investment in the country.
In July 2003, I created a central bank for the first time in the country’s history. We freed interest rates. We let markets set the rates. We cut taxes on businesses and individuals. We simplified business procedures so you could start a new company in Iraq in 10 days. We modernized and strengthened patent and copyright laws. We opened a stock market. We replaced the entire stock of currency. It was about 2,200 tons of currency that had to come in. 13,000 tons of old currency had to be destroyed. The new currency alone filled twenty-seven 747 airplanes. We did this over a 90-day period without a single incident, with no telephones, no electricity, lousy roads, and a war. On balance, I think the economy is doing rather well. Reconstruction is going forward.
During the 14 months we were there, we completed over 20,000 reconstruction projects, most of them small projects, but very important to people. Re-opening a school, building a generator for a hospital, repairing windows in a municipal center, and refurbishing a soccer field. Oil production is running at about 2.2 million barrels a day, roughly what it was before the war. Unemployment has fallen to about 20 percent, it’s half that in major urban areas. Inflation is running at an annual rate of 3 percent. With better security, I don’t think there is any doubt that Iraq will take its place as one of the leading countries in the region.
How do you get a model political system in a country that had never known it?… Fifteen months ago, working with Iraqis, I laid out a clear plan for Iraq’s transition to democracy. We laid out a number of steps and we followed every step along the way. We said we would have a new constitution by the end of February, we did. We said we were going to appoint a broader Iraqi interim government by the end of May, we did. We said we would return sovereignty to the Iraqis by the middle of June and we did. And we said we would have elections by the end of January, and we did.
The pundits in this country have consistently under-estimate the Iraqi people and the American government’s will to follow this path. The constitution, which I signed into law March 8 a year ago, established a balance of power. It contains a completely unprecedented bill of rights, guaranteeing the kinds of freedoms which we take for granted: the freedom of assembly, the freedom of speech, the freedom of the press, freedom of religion. All Iraqis are guaranteed equal rights, regardless of their background. A man is innocent until proven guilty. The right of habeas corpus was established. The elections which just took place are a great victory for democracy and freedom over tyranny and terrorism. The president said every vote cast was an act of defiance against the terrorists.
It is clear there will be bumps on the road going ahead. The movement from tyranny to freedom is never easy. I was recently reading a story of a country moving from tyranny to freedom and it describes the characteristics of that country: looting, crime, mobs, the storming of government buildings, the breakdown of government structures that had been responsible for security. Rampant inflation. Supporters of the former regime roaming the streets and countryside. Endless delays and bickering over the establishment of a new government.
I am describing the United States in 1783. I do that to encourage Americans to take a bit more perspective on what’s happening in Iraq. And not to be too quick to criticize the process. Remember that it took us seven years to win our independence. It took 12 years to write our constitution. And it took us 20 years before we even had political parties. Iraq has done all of this in less than two years and without the benefit of the great Anglo-American tradition that we benefited from in the 18th century. The key here is that the process has started, and the direction is good.
Who are we fighting over there? There are basically two groups. There are the Saddamists. They have a simple vision for Iraq, which is to take Iraq back. In fact, they call themselves “the party of return.” Then there are the al Qaeda terrorists. Their vision for Iraq is also very simple. It is to do to Iraq what they did to Afghanistan when the Taliban took over. Both of these groups are anti-democratic. They cannot win an election, so they have to be against the elections. And not surprisingly, the Iraqis were targets in the election. But the Iraqis came forward. Thousands went to the poles. They come forward everyday to be recruited into the police and the National Guard. Iraqis are literally dying for democracy every day.
From day one, security was a multi-national effort. Even today, there are 27 other countries with troops on the ground along side ours in Iraq. But in the long run, security in Iraq belongs to the Iraqis. So we have set up very robust training plans. For example, the world’s largest training plan for police was set up -- to train 25,000 police in less than a year and a half. We set up training for a new Iraqi army and National Guard. Today there are about 130,000 Iraqis in these various groups. They are improving, and they did a very good, commendable job at the elections.
Al Qaeda is operating there. Al Zarkowi is running al Qaeda there. He is followed by bin Laden, the prince of al Qaeda. These guys understand fully the danger to terrorists of a pluralistic, democratic Iraq. Bin Laden, in his latest statement, in December, condemned
the elections as un-Islamic. Why? Because they would put man and not God in charge of Iraq. Zarkowi, more than a year ago, in a note to his colleagues, said there is no place for us in a democratic Iraq. And just a week before the elections, he issued a statement declaring what he called a bitter war against this evil principle, democracy. The terrorists understand full well that when we succeed in Iraq, they fail. And when they fail in Iraq, it will have very big implications not just for Iraq. Go back to Bernard Lewis’ analysis. If Iraq can be relatively pluralistic and stable, it can give an example of a successful Islamic state modernizing in this world. That is remarkable.
It may be too early today to know who the winners in the Iraqi elections are, but you know who the losers are. You can find out by watching reports of the television coverage of the Iraqi elections in Syria and Saudi Arabia and Iran. Because when they covered the elections, they were covering pictures of Iraqis living in Syria and Saudi Arabia and Iran voting in the election in Iraq -- the same thing we saw here when the voters came out of the voting booths in Detroit, Nashville and Washington. They saw Iraqis dancing in the streets of Riyadh and Hamah and Teheran. That must, in the end, be a rather frightening thing for these rather non-democratic governments.
The president speaks of “an arch of reform” stretching from Morocco to Afghanistan. Already municipal elections have just been held in Saudi Arabia for the first time in history. There is an arch of reform. The example of Iraq is already spreading like a very helpful contagion in the area.
Iraq has a very skillful people. The vast majority wanted to be liberated from Saddam and want nothing to do with going back.
We are engaged in a noble enterprise. We are only at the beginning. It is likely to be a long, difficult struggle. It is like where we were at the end of the Second World War when we faced communism. I think we will succeed. It is likely to define American security policy for a generation to come. We just need to be as patient and as tough-minded as we were in the war against soviet communism. American history suggests we will succeed. We are not quitters. We will not fail America, Iraq or the people of the world who face this new challenge.
The political response has been impossible to miss: stopping terrorism has become our top priority, homeland security became serious business and our military removed the long-standing political regime in Iraq. It is not always easy for ordinary citizens such as me to understand all the connections, to get a handle on the scope of our challenge, to comprehend the motivation of people who would lash out at our country.
L. Paul Bremer III, the former U.S. Envoy to Iraq, spoke to a business group in Phoenix on President’s Day. He described the United States’ response to the terrorist attacks, including its activities in Iraq. Bremer served as the administrator of the Coalition Provisional Authority beginning May 6, 2003. He completed his work on June 28, 2004 when he handed over power to the interim government of Iraq. I found it extremely interesting to get an hour-long presentation on terrorism and Iraq from someone who has been on the front lines. I liked getting the story straight from someone who knows, without the filter of editors. I can make my own allowances for what I suspect to be Bremer’s political leanings.
Bremer knows a thing or two about international affairs. During a 23-year State Department career, he served as special assistant or executive assistant to six secretaries of state. He worked in the U.S. embassies in Afghanistan and Malawi, and as deputy chief of mission at the American Embassy in Norway. President Reagan named him ambassador to the Netherlands in 1983, where he worked for three years.
He also has a lot of experience dealing with terrorism. He was President Reagan’s ambassador at large for counter-terrorism. In 1999, he was appointed chairman of the National Commission on Terrorism. In June 2002, President Bush named him to his Homeland Security Advisory Council.
What follows are excerpts from Bremer’s February 21 speech:
I was shocked by what happened on September 11, but not actually surprised by it. The reason was I had served as chairman of the National Committee on Terrorism. We had reported to President Clinton and to Congress and the American people more than 15 months before September 11 that we should expect terrorists to conduct mass casualty attacks on American soil, on a Pearl Harbor scale. This was a bi-partisan commission. We were not that smart, we just cited the evidence. And the evidence suggested that we faced a new kind of terrorist attack.
What we found was a different kind of terrorism appeared in the early 1990s. If you look at the terrorism we fought in the 1960s, 1970s and 1980s, terrorism then is what I would call “old style terrorism.” They used terrorism as a way of attracting attention to their cause, which they thought had broad appeal. So they would kill a few people in order to get the press to come to the site and then they would issue some statement drawing attention to their cause. They didn’t want to kill a lot of people because they were afraid if they did they would turn off public support… They didn’t want to get caught, they didn’t want to die, and they didn’t want to kill an awful lot of people.
We on the National Commission of Terrorism found three trends in the 1990s that told us something new was afoot. First of all, we noticed that in the 1990s, the number of terrorist incidents was declining but the number of casualties was rising. Second, there was a dramatic increase in the 1990s of suicide attacks. They had been almost unknown in the 1970s and 1980s. And third, the states that the American government identified as supporting terrorists were involved in research of weapons of mass destruction. That meant that terrorists could get their hands on those things – nuclear, radiological and biological weapons.
And indeed, it suggested new motives on the part of the terrorists. What do we know about those folks? Actually we know quite a lot because they have spoken very openly. You can study their statements, their fatwas, their press conferences. Now you can study their web sites.
Basically, they are driven by a view that Islam is necessarily at war with the West. And that they must, as a duty, convert or kill all non-Muslims. They are very frank about this. They are motivated by a burning hatred of the West. Not just the superficialities of the West -- our newspapers, our television shows and our movies -- but by the very foundations of the West: universal suffrage, separation of church and state, women’s education, and above all, democracy. These are the things they very clearly state they hate and are against. And they seek not modest change, but basically world changing revolution. And they very dearly want to kill us by the thousands or by the tens of thousands.
People forget that there was a first World Trade Center attack in February of 1993. And we caught a number of the terrorists and they have since confessed that their objective was to topple the two towers together. Their objective was to kill 250,000 Americans.
What’s the root cause of terrorism? Can’t we deal with the root cause? Ladies and gentlemen, the root cause of these terrorists -- these extremists -- is nothing less than our existence and our success.
What creates that kind of hatred? I don’t know; one thing for sure is it is not poverty. The 19 young men who flew those planes into the World Trade Center, into the Pentagon and in Pennsylvania were, every one of them, well educated, upper middle class Arabs, mostly from Saudi Arabia. Osama bin Laden, who headed al Qaeda, his main theologian is a well-educated Egyptian doctor. These are not poor people. Bernard Lewis, who is professor emeritus at Princeton University, one of the country’s leading observers of the Islamic world, believes a lot of this hatred comes from self-hatred. It comes from the realization that in the last 300 years Islamic countries have had failure after failure, and have not been able to reconcile Islam with the modern world.
These new terrorists are prepared to die for their cause and we have to take them just as seriously. We have got to develop a robust strategy to deal with this.
President Bush has said that the war of liberation in Iraq is related to the war on terrorism. And he is right.
First of all, American administrations from both parties for more than 20 years have identified Iraq as a state that supports terrorism. And the reasons are very clear. Under Saddam Hussein, Iraq supported Palestinian terrorists. He gave safe refuge to notorious characters. His government supported Iranian terrorist groups. The bi-partisan 9-11 Commission reported in the fall there was clear evidence of a connection between Saddam’s government and members of al Qaeda throughout the 1990s.
Moreover, it was the stated policy of the American government, supported by both parties, both Houses of Congress, and signed into law by a Democrat president, to seek regime change in Iraq. Therefore, in early 2003, after Iraq had been found to be in violation of 17 U.N. resolutions dealing with WMD, after the intelligence services of the U.S., Britain, France, Russia, Germany, and others, I think it was correct for the president to conclude that the status quo was not sustainable. Sanctions were weakening. The time had come for action.
So when I left for Iraq in May 2003, I had no doubt that this war was related to the war on terrorism…
What kind of situation did we find on the ground? First of all, let’s talk about the evidence of Saddam’s brutality, which was everywhere. People forget that Saddam modeled his society on Hitler. He says so in his biography. He admired the way Hitler and Stalin were able to control their society. Mein Kampf was required reading in Saddam’s intelligence services.
About a week after I got there, I visited the first of the mass graves in a town called Hillah, about 50 miles south of Baghdad. You might remember that after the 1991 uprising in the south, the Shi'a rose up. Saddam sent in his army into the Shi'a town south of Baghdad. They picked up men, women and children, put them on flatbed trucks, took them out to open fields and machine-gunned them down, and threw them into open pits. This site that I visited at Hillah was about three times the size of a football field. And it was covered with little clumps of bones. All over there were people scrambling to see if they could find some evidence, a piece of clothing, an ID card, jewelry, that would identify the bones of a relative. We estimated that there were 20,000 to 30,000 bodies in this grave alone. By the time I left 14 months later, we found over 100 mass graves in Iraq. Human Rights Watch estimates that Saddam killed over 300,000 of his fellow citizens while he was in power. No one will ever know how many he killed. There are more than one million Iraqis still missing.
I also visited the police stations; every police station had a torcher chamber. Most of them had rape rooms, including the Baghdad central police station. I visited a town in the Kurdish region called Halabja, up in the north, on the east border with Iran. One day in March 1988, Saddam used chemical weapons on his own people, killing 5,000.
When it is safe, I challenge you to go to Iraq and visit the mass graves, look at the torcher chambers, talk to some of the survivors of the rape rooms. Go up and see the 5,000 tombstones in Halabja. I guarantee after you see those things you will conclude as I have that we did a noble thing liberating the people of Iraq.
The collapse of the government in Iraq is one of the most dramatic and abrupt in recent history. It was very different from what happened in the Soviet Union, and Eastern Europe where the change really took place over about a 20-year period. In Iraq, it happened in three short weeks.
It was clear when we got over there that we needed action in three areas: We needed to get the economy going. We needed to start the process of political reform, and of course, we had to deal with the security situation.
The economy was a wreck. Saddam combined the worst features of corruption with socialism and its unbounded faith in bureaucrats. The result was that over a period of almost 30 years there was a really spectacular misallocation of capital. Between 1979 and 2002, the World Bank found that Iraq’s per capita GDP dropped more than any country in the world. In the decade of the 1990s, when Saddam was arguing for the sanctions to be lifted, he cut health care spending by 90 percent, so that by 2002 Iraq had the shortest life expectancy and the highest infant mortality rate of any country in the region.
Even in the wonderful land between the waters in Mesopotamia, there was a water crisis. The U.N. estimated that every day tons of untreated sewage was being dropped into the Tigris and Euphrates Rivers.
Almost all of Iraq’s state-owned enterprises were bankrupt. The banking system was bankrupt. There were state-owned banks that made loans on political dictates, not according to the markets.
We had a budget crisis, the size of which was not that clear to us because under Saddam, the budget was a state secret. We found to our surprise that only 8 percent of the national budget was actually spent by the ministries; 92 percent was spent directly out of the presidency, by Saddam. We knew we were going to go broke by the end of 2003. The consequences of fiscal indiscipline were dramatic. Saddam had simply run his printing presses throughout the 1990s to cover his deficits. His people told us that at the end of 2002, inflation was running at the rate of 115,000 percent. We faced a challenge as great as the challenge the United States faced in the Depression.
I decided we needed to move economically on two dimensions. We needed to get consumption going quickly. And we needed to start longer-term reform, and to put reasonable macro-economic policies in place. Getting the economy going was tough. We had unemployment of about 50 percent. But, we the government were the largest employer. We could find no good payroll records in any of the ministries. The pay system was all over the place. There were special systems, under the table payments, bribes, kickbacks, all kinds of things. We cut through it very quickly. Within a week of arriving, I mandated a four-grade pay scale, and subsequently put in a more sophisticated 13-grade pay system, which we did in August. That wasn’t so easy because we had no banking system, so we had to pay in cash, by hand. Our payroll was about $200 million a month, including pensions. This money had to be transported around the country while the war was going on.
I also knew that we had to create jobs and I immediately allocated hundreds of millions of dollars of the Iraqi budget to new WPA-like public works programs. We were able to create several hundred thousand jobs in the first few months.
We also needed to start the longer-term process of starting macro-economic reform. Within 90 days, we had established a regime of open tariffs; we got rid of Saddam’s tax on foreign investment to encourage outside investment in the country.
In July 2003, I created a central bank for the first time in the country’s history. We freed interest rates. We let markets set the rates. We cut taxes on businesses and individuals. We simplified business procedures so you could start a new company in Iraq in 10 days. We modernized and strengthened patent and copyright laws. We opened a stock market. We replaced the entire stock of currency. It was about 2,200 tons of currency that had to come in. 13,000 tons of old currency had to be destroyed. The new currency alone filled twenty-seven 747 airplanes. We did this over a 90-day period without a single incident, with no telephones, no electricity, lousy roads, and a war. On balance, I think the economy is doing rather well. Reconstruction is going forward.
During the 14 months we were there, we completed over 20,000 reconstruction projects, most of them small projects, but very important to people. Re-opening a school, building a generator for a hospital, repairing windows in a municipal center, and refurbishing a soccer field. Oil production is running at about 2.2 million barrels a day, roughly what it was before the war. Unemployment has fallen to about 20 percent, it’s half that in major urban areas. Inflation is running at an annual rate of 3 percent. With better security, I don’t think there is any doubt that Iraq will take its place as one of the leading countries in the region.
How do you get a model political system in a country that had never known it?… Fifteen months ago, working with Iraqis, I laid out a clear plan for Iraq’s transition to democracy. We laid out a number of steps and we followed every step along the way. We said we would have a new constitution by the end of February, we did. We said we were going to appoint a broader Iraqi interim government by the end of May, we did. We said we would return sovereignty to the Iraqis by the middle of June and we did. And we said we would have elections by the end of January, and we did.
The pundits in this country have consistently under-estimate the Iraqi people and the American government’s will to follow this path. The constitution, which I signed into law March 8 a year ago, established a balance of power. It contains a completely unprecedented bill of rights, guaranteeing the kinds of freedoms which we take for granted: the freedom of assembly, the freedom of speech, the freedom of the press, freedom of religion. All Iraqis are guaranteed equal rights, regardless of their background. A man is innocent until proven guilty. The right of habeas corpus was established. The elections which just took place are a great victory for democracy and freedom over tyranny and terrorism. The president said every vote cast was an act of defiance against the terrorists.
It is clear there will be bumps on the road going ahead. The movement from tyranny to freedom is never easy. I was recently reading a story of a country moving from tyranny to freedom and it describes the characteristics of that country: looting, crime, mobs, the storming of government buildings, the breakdown of government structures that had been responsible for security. Rampant inflation. Supporters of the former regime roaming the streets and countryside. Endless delays and bickering over the establishment of a new government.
I am describing the United States in 1783. I do that to encourage Americans to take a bit more perspective on what’s happening in Iraq. And not to be too quick to criticize the process. Remember that it took us seven years to win our independence. It took 12 years to write our constitution. And it took us 20 years before we even had political parties. Iraq has done all of this in less than two years and without the benefit of the great Anglo-American tradition that we benefited from in the 18th century. The key here is that the process has started, and the direction is good.
Who are we fighting over there? There are basically two groups. There are the Saddamists. They have a simple vision for Iraq, which is to take Iraq back. In fact, they call themselves “the party of return.” Then there are the al Qaeda terrorists. Their vision for Iraq is also very simple. It is to do to Iraq what they did to Afghanistan when the Taliban took over. Both of these groups are anti-democratic. They cannot win an election, so they have to be against the elections. And not surprisingly, the Iraqis were targets in the election. But the Iraqis came forward. Thousands went to the poles. They come forward everyday to be recruited into the police and the National Guard. Iraqis are literally dying for democracy every day.
From day one, security was a multi-national effort. Even today, there are 27 other countries with troops on the ground along side ours in Iraq. But in the long run, security in Iraq belongs to the Iraqis. So we have set up very robust training plans. For example, the world’s largest training plan for police was set up -- to train 25,000 police in less than a year and a half. We set up training for a new Iraqi army and National Guard. Today there are about 130,000 Iraqis in these various groups. They are improving, and they did a very good, commendable job at the elections.
Al Qaeda is operating there. Al Zarkowi is running al Qaeda there. He is followed by bin Laden, the prince of al Qaeda. These guys understand fully the danger to terrorists of a pluralistic, democratic Iraq. Bin Laden, in his latest statement, in December, condemned
the elections as un-Islamic. Why? Because they would put man and not God in charge of Iraq. Zarkowi, more than a year ago, in a note to his colleagues, said there is no place for us in a democratic Iraq. And just a week before the elections, he issued a statement declaring what he called a bitter war against this evil principle, democracy. The terrorists understand full well that when we succeed in Iraq, they fail. And when they fail in Iraq, it will have very big implications not just for Iraq. Go back to Bernard Lewis’ analysis. If Iraq can be relatively pluralistic and stable, it can give an example of a successful Islamic state modernizing in this world. That is remarkable.
It may be too early today to know who the winners in the Iraqi elections are, but you know who the losers are. You can find out by watching reports of the television coverage of the Iraqi elections in Syria and Saudi Arabia and Iran. Because when they covered the elections, they were covering pictures of Iraqis living in Syria and Saudi Arabia and Iran voting in the election in Iraq -- the same thing we saw here when the voters came out of the voting booths in Detroit, Nashville and Washington. They saw Iraqis dancing in the streets of Riyadh and Hamah and Teheran. That must, in the end, be a rather frightening thing for these rather non-democratic governments.
The president speaks of “an arch of reform” stretching from Morocco to Afghanistan. Already municipal elections have just been held in Saudi Arabia for the first time in history. There is an arch of reform. The example of Iraq is already spreading like a very helpful contagion in the area.
Iraq has a very skillful people. The vast majority wanted to be liberated from Saddam and want nothing to do with going back.
We are engaged in a noble enterprise. We are only at the beginning. It is likely to be a long, difficult struggle. It is like where we were at the end of the Second World War when we faced communism. I think we will succeed. It is likely to define American security policy for a generation to come. We just need to be as patient and as tough-minded as we were in the war against soviet communism. American history suggests we will succeed. We are not quitters. We will not fail America, Iraq or the people of the world who face this new challenge.
Tuesday, March 01, 2005
Free Credit Reports
I could hardly wait until today. March 1 is the first day I can get a free credit report. So on my lunch hour, I closed my office door, adjusted my computer screen and tried to get reports from each of the credit reporting agencies.
On a four-star scale, I would say I got a two-star experience.
The Fair Credit Reporting Act requires the three credit reporting agencies to make reports available for free. People living on the West Coast have been able to get their reports since December 1. Most of the states in the Midwest had to wait until March 1, and the rest of the country phases in June 1 and September 1. Equifax, Experian and Trans Union are participating; reports can be obtained via the Internet, by phone or through the mail. Consumers are entitled to one free report from each company, one time per year. A consumer can get all three reports at the same time, or stagger the requests to get them throughout the year.
My portal to the three companies was www.annualcreditreport.com. The site worked well, although I was disappointed that each time I returned to the site after completing a download from one of the agencies, I had to re-enter my personal information. I was a little nervous about entering my Social Security number to make the site work, but I was placated by the promise of encryption and other security measures.
Equifax was the first company I visited, and it turned out to be my best experience of the three. I got an 18-page report on my credit situation. It told me how many accounts I have open, how much credit is available through each account, and my payment history for each one. I also got information about who has requested to see my credit report.
Most interesting was a unique report called the Equifax Credit Ranking. This little service tells me how my debt stacks up against peers, such as those living in my zip code area, my state and my country. For example, the report told me the average Minnesotan has $828 outstanding in credit card debt, the average person living in my zip code area has $863 and the average person in the United States has $972. I got similar reports for average car payments and mortgage payments. I was intrigued to learn that the average person in my neighborhood pays a $380 monthly car payment. That compares with a state average of $490, and a national average of $534. The average outstanding balance on those car loans is $9,668 for the neighborhood, $9,687 for the state, and $10,708 for the country.
Perhaps the most interesting feature in the Credit Ranking service was a chart that told me I am using only a very small percentage of the total credit available to me. In my neighborhood, people are using 19 percent of the credit available to them, about the same as the state average, which is 20 percent. The national average, the report says, is 25 percent.
Experian also provided a comprehensive report, although without the cool comparison data. I spent about a half an hour trying to access the Trans Union site, but never succeeded. I kept getting a message that said “site temporarily unavailable.” Oh well. There must have been a lot of other people excited about a new opportunity to get a free credit report, trying to get on the site.
If you haven’t already tried to do this on your own, I encourage you to do so. It is always an eye-opener to learn what the rest of the world knows about you.
On a four-star scale, I would say I got a two-star experience.
The Fair Credit Reporting Act requires the three credit reporting agencies to make reports available for free. People living on the West Coast have been able to get their reports since December 1. Most of the states in the Midwest had to wait until March 1, and the rest of the country phases in June 1 and September 1. Equifax, Experian and Trans Union are participating; reports can be obtained via the Internet, by phone or through the mail. Consumers are entitled to one free report from each company, one time per year. A consumer can get all three reports at the same time, or stagger the requests to get them throughout the year.
My portal to the three companies was www.annualcreditreport.com. The site worked well, although I was disappointed that each time I returned to the site after completing a download from one of the agencies, I had to re-enter my personal information. I was a little nervous about entering my Social Security number to make the site work, but I was placated by the promise of encryption and other security measures.
Equifax was the first company I visited, and it turned out to be my best experience of the three. I got an 18-page report on my credit situation. It told me how many accounts I have open, how much credit is available through each account, and my payment history for each one. I also got information about who has requested to see my credit report.
Most interesting was a unique report called the Equifax Credit Ranking. This little service tells me how my debt stacks up against peers, such as those living in my zip code area, my state and my country. For example, the report told me the average Minnesotan has $828 outstanding in credit card debt, the average person living in my zip code area has $863 and the average person in the United States has $972. I got similar reports for average car payments and mortgage payments. I was intrigued to learn that the average person in my neighborhood pays a $380 monthly car payment. That compares with a state average of $490, and a national average of $534. The average outstanding balance on those car loans is $9,668 for the neighborhood, $9,687 for the state, and $10,708 for the country.
Perhaps the most interesting feature in the Credit Ranking service was a chart that told me I am using only a very small percentage of the total credit available to me. In my neighborhood, people are using 19 percent of the credit available to them, about the same as the state average, which is 20 percent. The national average, the report says, is 25 percent.
Experian also provided a comprehensive report, although without the cool comparison data. I spent about a half an hour trying to access the Trans Union site, but never succeeded. I kept getting a message that said “site temporarily unavailable.” Oh well. There must have been a lot of other people excited about a new opportunity to get a free credit report, trying to get on the site.
If you haven’t already tried to do this on your own, I encourage you to do so. It is always an eye-opener to learn what the rest of the world knows about you.
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