Automotive

Documents Detail Another Delayed GM Recall

The embattled automaker waited years to recall nearly 335,000 Saturn Ions for power steering failures, government documents say

Updated 3:59 PM ET

(DETROIT) — General Motors waited years to recall nearly 335,000 Saturn Ions for power steering failures despite getting thousands of consumer complaints and more than 30,000 warranty repair claims, according to government documents released Saturday.

The National Highway Traffic Safety Administration, the government’s auto safety watchdog, didn’t seek a recall of the compact car from the 2004 through 2007 model years even though it opened an investigation more than two years ago and found 12 crashes and two injuries caused by the problem.

The documents, posted on the agency’s website, show yet another delay by GM in recalling unsafe vehicles and point to another example of government safety regulators reacting slowly to a safety problem despite being alerted by consumers and through warranty data submitted by the company.

Both GM and NHTSA have been criticized by safety advocates and lawmakers for their slow responses to a deadly ignition switch problem in 2.6 million GM small cars. GM admitted knowing about the problem for more than a decade, yet didn’t start recalling the cars until February. The company says it knows of 13 deaths in crashes linked to the ignition switches, but family members of crash victims say the number is much higher.

The Ion was one of a few GM cars included in a March 31 recall of 1.5 million vehicles worldwide to replace the power steering motors; the recall also covered some older Saturn Auras, Pontiac G6s and Chevrolet Malibus. If cars lose power steering, they can still be steered, but with much greater effort. Drivers can be surprised by the problem and lose control of the cars and crash.

NHTSA closed its investigation into the Ion because GM had decided to recall the cars, according to the documents released Saturday.

In a statement issued Saturday, GM admitted that it didn’t do enough to take care of the power steering problem. A NHTSA spokesman told The Associated Press he was checking into the matter.

The number of complaints and claims with the power steering issue appears to be high when compared with other recent recalls that were preceded by NHTSA investigations. In March, three recalls — none of which were GM vehicles — were issued after two or fewer complaints. There were 29 warranty claims in one case, 263 in another and none in the third investigation. All three cases covered fewer vehicles than the Ion recall.

A search of the agency’s database records shows that Ion owners started complaining about power steering failures as early as June 2004, and the first injury accident was reported to NHTSA in May 2007. The owner of a 2004 Ion reported driving 25 mph and tried to turn the steering wheel, but it locked, and the car crashed into a tree.

“Saturn stated the vehicle is not a defect,” the complaint said.

Another driver who filed a complaint in July 2010 said that one evening, “midway around a bend, my vehicle’s electric power steering went out and straightened my wheel, putting me into oncoming traffic.”

“I could have died and killed another driver,” said that person, who also owned a 2004 Saturn Ion.

The government does not identify people who file complaints with NHTSA.

Some of the people who complained about the Ion power steering found on the Internet that GM had recalled the Chevrolet Cobalt for the same problem in 2010. The Cobalt is nearly identical to the Ion.

“Very disturbed that the Cobalt was recalled for this problem and not the Saturn,” one owner wrote in 2010. “Makes no sense since the power steering is the same in both vehicles.”

GM spokesman Greg Martin wouldn’t comment directly on the Ion power steering Saturday, but pointed out a quote from the company’s new global safety chief Jeff Boyer when GM issued the power steering recall.

“We have recalled some of these vehicles before for the same issue and offered extended warranties on others, but we did not do enough,” Boyer said in March. “With these safety recalls and lifetime warranties, we are going after every car that might have this problem, and we are going to make it right.”

Martin also said GM has created a team that includes safety in the company’s product development.

Advertising

If You Have a Heart, This Puppy Ad Will Completely Melt It

+ READ ARTICLE

American spending on pets reached a record $55.7 billion last year, according to the American Pet Products Association. “If the pet industry were tracked by the U.S. government as a single entity, we’d be the seventh largest retail segment in the country,” Bob Vetere, CEO of the industry group told TIME recently. All that spending has been a boon to pet-food marketers willing to capitalize on the Web’s obsession with animals. Now Pedigree New Zealand is trying to use puppies and YouTube’s revenue-sharing model to raise money for dog charity—and drive views. Apparently, this involves watching uber-cute dachshunds eating hot dogs.

Careers & Workplace

17 Things Extremely Happy People Say Every Day

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Are you as happy as you wish you were? If not, try saying a few of these simple, inspiring things to other people


This post is in partnership with Inc., which offers useful advice, resources, and insights to entrepreneurs and business owners. The article below was originally published atInc.com.

There’s an easy-to-articulate, hard-to-implement best practice when it comes to how to teach yourself to be happy. It stems from the recognition that the positive things you do for other people often reverberate back to create positivity in your own life. In effect, doing little things to make other people happy can greatly improve your happiness.

Make sense? There are two theories at work. The first is that focusing on others creates joy of its own accord. The second is that as you succeed in improving others’ happiness, you’ll wind up with happier, more grateful people around you. They’ll find you likable and charismatic, which in turn can lead them to treat you in a manner that produces even more happiness.

It’s easier said than done, but fortunately, there’s a compelling shortcut. Your words are among your greatest tools, so you can have an outsize effect on others simply by thinking about what you say every day and making an effort to be both positive and sincere. There are certain inspiring things that truly happy people find themselves saying to others all the time. Try making an effort to say a few of these every day for a week. You’ll be amazed at how the positivity you create improves your happiness.

1. “I’m happy to see you.”

This is the most basic and attractive sentiment you can express to another human being–that simply being in the person’s presence creates a positive feeling. Whether you’re telling an employee that you need his skills, that you value his opinions, or just that you think he’s good company, you’ve begun an interaction on a very high note. How can that not produce some level of happiness in the other person?

2. “I’m always happy to see you.”

Take the previous remark a step further. This is the opposite of most relationship advice–that you should never take a specific negative action and suggest that it’s indicative of someone’s entire way of acting. Well, turn that on its head, by expressing that it’s not just this interaction that has produced positive feelings but basically all interactions with this person. It’s an amazingly gratifying thing to hear.

3. “Remember when you…”

Surprise someone by bringing up a positive thing that she did in the past, and you’re almost guaranteed to induce a positive response. Maybe it’s a joke the person told that you’re still laughing about; maybe it’s a small act of heroism she performed. Regardless, if it’s something she thought was long forgotten, learning that something she did made a positive, lasting impression on someone else is an amazing experience.

4. “You might not realize this, but…”

This an even more potent version of the previous suggestion, provided you finish the sentence with a description of how the person’s actions led to a positive outcome. It’s one thing to learn that other people recognize the favorable things you’ve done; it’s another thing entirely to learn that you’re having a positive effect on other people without even realizing it.

5. “You really impress me.”

This is similar to “I’m happy to see you” and “I’m always happy to see you,” except that it focuses on things that the person does, rather than his or her existential being. Other variations include “You are really great at…” or “People love that you…” Simply be sincere and specific. “You’re really great at calming stressful situations” or “People love that you always have the best music.” It can be anything, as long as it’s authentic and truly positive, and it’s guaranteed to elicit positive reactions.

6. “You really impressed me when…”

Focusing on specific actions or events can be even more powerful. It means that you’re not only thinking abstractly but offering proof that things the other person does provoke positive reactions. It’s the difference between saying that a comedian was really funny and quoting one of his or her best jokes. (Other versions: “You handled that well when you turned that client’s objection into an opportunity” or “It was really cool to see how you parallel-parked that car into that tiny spot.”)

7. “I believe in you.”

People have self-doubts. You do, I do, we all do. (Heck, every time I write a column here–and this is number 167, by the way–I wonder how people will react.) When others simply say they believe in you, however, it becomes easier to believe in yourself.

Here’s an analogy. Have you ever gotten into lifting weights, or simply watched people do it? It’s amazing how the slightest bit of assistance from a spotter–with force equal to the weight of a pencil–can help someone lift far more weight than he could on his own. It’s the same concept here–just that small expression of confidence can push people to achieve more–and then to be thankful for the help.

8. “Look how far you’ve come!”

It is so important to celebrate achievements. This doesn’t mean you have to throw a party, but even acknowledging that someone’s efforts have achieved results can be extremely gratifying for the person.

Of course, heck, if you want to take things to the extreme, throw a party. Just be sure that you’re the one buying the first round and singing the loudest.

9. “I know you’re capable of more.”

Everyone needs to be pushed at times, especially when we fall short. If you care about people, you’re going to be called on sometimes to be a bit of a coach, or maybe to employ a bit of tough love. Even the most steadfast and confident among us sometimes need a friend to guide them to a better way of acting.

The late, great NFL coach Vince Lombardi put this best: “Leadership is getting someone to do what they don’t want to do, to achieve what they want to achieve.” Nobody does anything great alone, so be the one standing by to help, and you’ll inspire positivity and gratitude.

10. “I’d like to hear your thoughts about…”

Everyone likes to think that his or her opinions matter, and of course they do–sometimes. However, this kind of invitation to share what someone thinks can’t help making the person feel just a tiny bit more self-worth, which in turns creates both happiness and positive feelings toward you. Just be sure to be sincere; don’t just say this for the sake of saying it. Make sure that you are truly interested in whatever subject you’re asking about and listen actively.

11. “Tell me more.”

This is the best follow-up to the last item. It tells the other person that you’re listening, and that you find value in what he or she is saying. The actor and writer Peter Ustinov once said that the greatest compliment he ever received took place when he was afraid he had gone on too long in a conversation with Prime Minister Margaret Thatcher, only to have her tell him, “Please continue.”

12. “I took your suggestion.”

OK, it’s almost too easy at this point. Combine asking someone’s opinion and demonstrating that the person has had impact on your life and you’ve provided him with two of the most gratifying, basic experiences of the human condition.

It doesn’t matter really whether you tried a new restaurant on the other person’s advice, followed his suggestion on how to begin an important conversation, or started getting up 15 minutes earlier for a week because he said it was a good idea. Simply being listened to and having impact makes people feel better. Bonus points if his suggestion created a positive result, but you’ll get credit regardless. (Related: “You were right.”)

13. “I’m sorry.”

Say this when you mean it–when you’ve done something worth expressing regret for or the other person deserves sympathy. However, don’t water it down by using it when you don’t mean it. In fact, one writer made a compelling argument recently that the phrase is so overused that it ought to be retired. That would be a shame, but it underscores how people appreciate this phrase when it’s sincere, and how it annoys them when it isn’t.

14. “I’d like to be more like you.”

Now you’ve got it–you’re expressing positivity toward other people almost naturally, pointing out not only things that they do well but maybe even things they do better than you do.

If you want to see a sentiment similar to this work very effectively, watch the 1997 movie As Good As It Gets. Or else, just read this short bit of dialogue in which Jack Nicholson’s character offers Helen Hunt’s character the ultimate compliment: “You make me want to be a better man.

15. “Thank you.”

It’s not that much of a stretch to suggest that every other item on this list is in fact a form of “thank you.” This is truly one of the most powerful, underrated phrases in the English language. It packs a heck of a punch, encompassing positivity and impact in two little syllables. (By the way, thanks for reading this far into this column. Maybe if you share it with others, they’ll thank you, too.)

16. “You’re welcome.”

Not “yep.” Not “no problem” or “no worries.” Say “You’re welcome.”

Instead of deflecting another person’s thanks, as some of these other phrases do, saying “you’re welcome” dignifies the person’s gratitude. It acknowledges that yes, you did do something worthy, or nice, or positive for someone–because you believe that she’s worth it.

17. “No.”

There’s one small risk in this entire mode of expression, and this word is your fail-safe. The danger is that sometimes people who make other people’s happiness their priority can wind up doing so at the cost of their own happiness. We all know some people who take advantage, or who simply aren’t going to be happy no matter what your efforts amount to.

Two little letters, and yet they can be so powerful. Most important, they demonstrate that you care for yourself, which is a key prerequisite to caring truly for other people. Carry this one in your back pocket; use it when necessary. You’ll find that the most positive and happy people you interact with respect you for doing so–and that can make you happy, too.

More from Inc.com:

12 Simple Tricks For Saving Time on Email

3 Beliefs of Highly Successful People

5 Things Anyone Can Do to Be More Self-Confident

legal

N.Y. Judge Upholds Charges Against Financier’s Kin

(NEW YORK) — A judge has declined to toss out federal fraud charges against the brother of a one-time billionaire hedge fund founder, though she noted that two charges have flaws that the government must fix.

U.S. District Judge Naomi Reice Buchwald said in a ruling filed Friday that the indictment brought against Rengan Rajaratnam adequately describes the crimes against him. Rajaratnam last year was indicted in the case that resulted in an 11-year prison sentence for his brother, Raj Rajaratnam.

Rengan Rajaratnam, 43, was charged with conspiracy to commit securities fraud and five counts of securities fraud. He has pleaded not guilty. Lawyers in the case did not immediately return messages for comment Friday.

The judge wrote that two counts in the indictment allege that the defendant directed certain traders to carry out illegal trades even though the government has also alleged that his brother caused the trades while Rengan Rajaratnam merely offered indirect aid. She called the counts inconsistent and said the government must drop them or offer a “coherent, logical theory as to how defendant aided and abetted the alleged securities fraud.”

The government has said Raj Rajaratnam had earned as much as $75 million illegally by trading on inside information provided by friends who were fellow money managers or corrupt employees of public companies.

Federal prosecutors said Rengan Rajaratnam had earned nearly $1.2 million illegally on 2008 trades involving Clearwire Corp. and Advanced Micro Devices Inc.

The brothers are part of a prosecution that has resulted in more than two dozen convictions.

Prosecutors say extensive use of wiretaps for the first time in an insider-trading probe is a reason for the success.

Autos

This Is What’s Going to Replace Your Boring Old Sedan

2015 Chevrolet Trax
2015 Chevrolet Trax Chevrolet

A new automotive segment is being hatched this Easter Week at the New York International Auto Show—the small SUV. Three new models aimed directly at millennials made their debuts: Chevrolet’s Trax, Jeep’s Renegade and Honda’s HR-V. “The small SUV is truly becoming the next big thing in the global auto market,” says Alan Bately, GM’s CEO for North America. Worldwide, the car manufacturers expect small SUVs to generate two million units in sales in 2015.

That’s more than enough sales to attract the likes of Fiat-Chrysler’s Jeep division, which unwrapped a gorgeous little Renegade. It’s the latest effort by the company to extend the Jeep brand, one of the hottest performers in the company, on a global scale. The Renegade has a passport, too. It was designed in Auburn Hills, MI. But the car will be manufactured in Fiat’s plant in Southern Italy, to take advantage of the company’s small car manufacturing skill as well as the available capacity.

Honda is adding the HR-V to its small vehicle lineup for a winter launch. It’s built on the same platform as the subcompact Fit.

The attraction of small SUVs, say manufacturers, is the combination of urban maneuverability, versatility, and improved fuel economy. “People are moving to smaller SUs because they like the SUV attributes like higher chair height for better command view of the road. They like the versatility between passengers and cargo,” says Jim Brown, Chevy’s product manager for small cars.

Named for a 2007 concept vehicle, the Trax was launched in late 2012 in Mexico and Canada as a 2013 model. About 90,000 have been sold in more than 60 global markets. In addition to the U.S., the 2015 Trax will also go on sale in China, adding the small SUV to Chevy’s two largest markets. Made in Korea, it will be in showrooms this December and likely cost in the mid $20,000s.

The development of the small SUV segment also demonstrates that millennials have entirely different criteria for purchasing cars than their parents did at the same age. To them, a small SUV is an all wheel drive iPad with room for their friends and their stuff. “A generation ago maybe there was more emphasis on horsepower, performance, those type of things,” says Cristi Landy, Chevy’s senior manager of strategy for small cars. “Now the most sacred possession for a lot of these people is their smartphone, so we’ve been able to integrate that technology into the vehicle very seamless fashion.”

The Trax will be available Siri Eyes Free, a 7-in.-diagonal color touch screen and additional USB ports. OnStar 4G LTE with a built-in Wi-Fi hotspot will allow passengers to connect multiple devices. And the driver can navigate with downloaded apps such as BrinGo, which will keep the cost of options down. Embedded music apps will include Pandora, Stitcher, and TunedIn. It will also have an engine, no doubt.

At Jeep, the new Renegade comes in urban and rural flavors, Latitude and Trailhawk, with a couple of powertrain and 4×4 options that can suit a variety of drivers, “whether it’s rigorous off-roading or just some social climbing in the city,” notes Jeep CEO Mike Manley. The 9-speed automatic transmission claims more than 30 mpg. Hewing to its off-road heritage, though, Renegade offers two “intelligent” 4×4 systems—Active Drive and Active Drive Low in the Trail Hawk version. The former allows seamless transfers between 2- and 4-wheel drive; the later is designed for ultra off-road travelers.

“Make no mistake, Renegade is pure Jeep,” Manley says, pointing out details such as the rounded headlamps and the seven-slot grill. The Renegade may have been conceived in America, but this Jeep also shows its Italian refinement. The design of the upper part of the SUV just screams Fiat. The curve of the windows, tilting toward the rear, the interior styling and the wide environmental view from inside all take cues from Renegade’s Italian in-laws, the Fiat Panda and 500.

Honda’s HR-V lacks any Continental legacy, nor can it claim much in the way of off-road chops. Then again that’s not what you’d expect from a Japanese utility vehicle. Instead, Honda is making a play for urban cool. The company says the HR-V will feature Honda’s Magic Seat, which morphs quickly into multiple configurations and allows the second row seat to go flat for added cargo space. It will be a complement to the Fit and a competitor to crossovers such as Nissan’s Juke and Kia’s Soul.

The manufacturers expect sales of small SUVs in the U.S. to increase 87% over the next three years, which is one reason they are rushing them to market. More importantly, these are vehicles perfectly suited to first time buyers. Get them now, goes the strategy, and you have a good shot at keeping them for decades.

LeBron James Is Lovin’ McDonald’s — in China

Brooklyn Nets v Miami Heat
LeBron James during a game at American Airlines Arena in Miami, March 12, 2014. Mike Ehrmann—Getty Images

The Miami Heat forward is taking center court in McDonald's plan to retool its strategy in the world's second-largest economy, where burgers have lost sales to noodles

China, meet McDonald’s new cultural emissary. LeBron James, meet China.

The fast food empire will feature the NBA star in its China-focused commercials later this year, using LeBron as a gambit to boost its sales by satisfying the Chinese love of American basketball.

McDonald’s new ad move is part of drive to lure more Chinese sales, the Wall Street Journal reports, where the company is redoing its China-based stores in Beijing, Shanghai and Guangzhou and overhauling its advertising campaign.

The moves come even as growth in China appears to be slowing, with overall economic growth in the country at 7.4% in the first quarter, its lowest level in 18 months.

Last year, China’s sales slowed 3.6% compared with 2012, as many of McDonald’s customers in China eat at cheaper local restaurants and noodle joints instead.

[WSJ]

 

Food and Beverage Industry

Big Comeback Planned for the All-American Drive-in Burger Joint

Wendy's hamburger has become more popular than McDonald's.
Paul Vernon / AP

The once-ubiquitous drive-in restaurant–you know, the kind with rollerskating waitresses–will be seen again very soon in all parts of the country, even in states where you wouldn’t want to eat outside for much of the year.

Sonic, the old-fashioned burger-and-shake chain known as “America’s Drive-in,” grew steadily in the early years of the new century. The company hit the 2,000-location market in 1999, and promptly leaped up to 3,000 drive-in locations by 2005. By late 2008, the 3,500th Sonic location opened in the U.S.

However, that’s where the expansion leveled off. Here we are, six years later, and the Sonic website lists the number of locations as simply “more than 3,500.”

It’s understandable that Sonic’s growth might slow substantially of late. The company’s franchise expansion stalled around the time of the Great Recession, when business slowed across a wide range of industries. Over the past five years or so, fast food lunch and dinner sales totals have generally plateaued, and a perception has taken hold that perhaps we’re reaching the point when American consumers just can’t handle any more fast food burger joints.

What’s more, Sonic stands out in the crowded field due to its drive-in feature, in which customers pull up into parking spots in their cars, place their order, and wait for one of the restaurant’s old-fashioned “carhop” staffers to delivery the food. It’s a charming custom, but the charm wears off when, say, it’s 20 degrees and there’s 18 inches of snow on the ground.

“The main difference that sets drive-ins and drive-thrus apart is that the demand for drive-ins is more heavily dependent on the weather,” Hester Jeon, an analyst with IBIS World, explained recently to Marketplace. “Sonic’s business dips pretty dramatically during the colder months.”

So another reason that Sonic’s growth slowed is that it was running out of warm-weather spots to open up more franchises. The company is based in Oklahoma, and its restaurants have traditionally been concentrated there and in Texas, Mississippi, Tennessee, and throughout the South—pretty much everywhere that spring starts early and the chill of fall sets in late.

Nonetheless, Sonic just announced huge plans for growth, with expansion in the U.S. expected to reach roughly the same pace it reached in the early ’00s. The numbers thrown around by Sonic are bold, and nice and round: 1,000 new locations over the next 10 years.

In light of the company’s already heavy presence in the South, how will Sonic do it? First, it’s targeting states with mild climates that don’t already have an abundance of Sonics, namely California. Over the next six years, the goal is to open 15 Sonics in southern California, specifically in greater Los Angeles and San Diego County, and another 15 elsewhere in California. By 2020, Sonic expects to have a total of 300 drive-in locations in the state.

Second, and most interestingly, Sonic isn’t shying away from cold-weather locations. Last summer, Sonic opened in its 44th state, an unlikely one for a drive-in chain: North Dakota.

What makes Sonic’s expansion to North Dakota and other spots with short summers feasible is the introduction of a new restaurant design prototype that features drive-in stalls and outdoor seating that most Sonics, but that also includes a decent-sized area for indoor seating—making the idea of eating at Sonic in January in North Dakota or upstate New York seem not totally nuts. “With locations up north, we had to think creatively about how to develop a location that works with inclement weather while still matching the iconic SONIC Drive-In look,” Bob Franke, Sonic senior vice president of franchise sales and international development, said in a press release for the opening of the North Dakota location. “The result is a new SONIC Drive-In prototype that gives our guests many options during their visit that won’t be disrupted by a little snow.”

The result for diners is that even if they live in an area of the country where drive-in dining wouldn’t be comfortable for the majority of the year, they’ll be fairly likely to see a Sonic pop up in their neck of the woods in the near future. “The Northern states are ripe with expansion opportunities for Sonic, given the brand’s relatively small footprint in the area combined with high customer awareness and pent-up demand,” Franke said earlier this year. Over the next handful of years, 13 new Sonics are planned in the vicinity of Buffalo and Rochester, N.Y., and by 2018 another 14 should open in the greater Seattle area.

Music Industry

Record Labels Suing Pandora Over Oldies

Major labels say Pandora is violating their copyrights to a slew of pre-1972 oldies like the Beatles, Rolling Stones and Aretha Franklin. While federal copyright laws don't protect the older tunes, record labels argue that the music is protected by some states

Sony, Warner and several other major record labels are suing Pandora for copyright infringement, accusing the Internet radio mogul of playing pre-1972 songs by artists like Buddy Holly and the Rolling Stones without licenses.

The record companies argue that while the pre-1972 songs Pandora plays aren’t covered by federal copyright protection, they are protected by common law in states like New York, where the case was filed Thursday, the New York Times reports. The labels control the rights to a litany of major artists like the Beatles, Aretha Franklin, Bob Dylan, James Brown and others.

The record labels claim that Pandora is unjustly profiting from their artists, denying them tens of millions of dollars each year from Pandora and other streaming services.

“This case presents a classic attempt by Pandora to reap where it has not sown,” the labels say in the suit.

María Elena Holly, the widow of Buddy Holly, said in a statement: “Just because Buddy and the other ’50s musicians recorded songs before 1972 doesn’t mean their songs have no value. These companies’ failure to pay the rock ’n’ roll pioneers is an injustice and it needs to change.”

Pandora plays songs according to user-preferred categories like “Motown” or “60s Oldies.” The company said it was confident in its legal position.

[NYT]

Here’s How You Help the Poor Without Soaking the Rich

AFGHANISTAN-SOCIETY-TULIPS
Afghan children Malik, 8, and Popal, 11, wait at a roadside with wild tulips for sale to potential customers driving through the Shamali plains, north of Kabul. SHAH MARAI—AFP/Getty Images

We have to clear our minds of a fallacy about poverty alleviation: Helping the poor does not mean welfare. This isn’t to say that we don’t need welfare. Ignoring the unfortunate who can’t put enough food on the table or afford proper education or healthcare is not just cruel, it’s bad economics. The impoverished make either good consumers or productive workers.

But government aid can only reduce the suffering of the poor; it usually can’t make them escape poverty permanently. We know that from watching what has happened in the developing world over the past half century. Those countries that have tried to use wide-scale state programs to alleviate poverty—such as India—have not achieved results as quickly as nations that did not, such as Singapore and South Korea. (See my recent piece on this subject.) Generally, the high-performance economies of East Asia didn’t fight poverty by playing Robin Hood—soaking the rich and handing out cash to the poor. There is no reason why we’d have to do that today.

Instead we have to give the downtrodden better jobs, more opportunities, more tools to improve their incomes and fairer treatment in economic policy.
That means we must improve the climate for investment. I’m pretty sure you didn’t expect me to write that when you started reading. There is a widespread assumption that what’s good for companies is bad for the little guy. But if Asia’s example teaches us anything, it’s that there are two ways to end poverty: (1) create jobs and (2) create more jobs. The only way to do that is to convince businessmen to invest more.

That’s why it is imperative to make investing easier. We should press ahead with free-trade agreements like the Trans-Pacific Partnership to bring down barriers between countries and encourage exports and cross-border investment. Though CEOs complain far too much about regulation—the sub-prime mortgage disaster, the recent General Motors recall, or Beijing’s putrid air all show that we need to keep a close eye on business—we should also streamline regulatory procedures, standardize it across countries and thus make it less onerous to follow.

We also need to improve infrastructure like transportation systems to bring down the costs of doing business. I think it is a national embarrassment for the U.S. to allow the Highway Trust Fund to run out of money at a time when the country needs both jobs and better roads. The environment for investment shouldn’t just improve for Walmart and Apple, but also entrepreneurs and small companies. In many parts of the world—in certain European countries, for example, and China—there’s too much red tape involved in starting a company, and not enough finance available.

We also need to invest in the workforce. U.S. Senator Marco Rubio, in an attack on a proposed minimum-wage hike, said that “I want people to make a lot more than $9—$9 is not enough.” He’s right, but that just won’t magically happen on its own. To get people’s paychecks up, workers have to possess better skills. We are simply not doing enough to improve schools, teachers and job training programs. We should also be doing more to make higher education more affordable.

While overall U.S. spending on education is among the highest in the world, it still lags in important ways. Take a look at this data comparing education spending across countries. U.S. public expenditure on education has remained more or less stable, at 5.1% of GDP in 2010, but that’s lower than a lot of other developed countries, from Sweden to New Zealand. What is also interesting is how the cost of education is pushed onto the private sector in the U.S. much more than in most other countries.

Spending is also heading in the wrong direction. The U.S. Census Bureau calculated that in fiscal 2011, expenditure per student dropped for the first time since statistics have been kept.

Clearly, the U.S. spends so much money on education already that we should be getting more bang for our buck. Reform is crucial to put all those billions to better use. But slicing spending isn’t the answer, either. The latest budget from U.S. Congressman Paul Ryan streamlines some U.S. education programs he considers wasteful and recommends measures that would add to the financial burden of going to college for some families. Meanwhile, he’s leaving the military budget generally unscathed. Do Ryan and his colleagues believe the Pentagon isn’t wasteful? Apparently not enough to put the military on a diet.

The fact is we have the money to do more for education. U.S. federal spending is about $3.5 trillion—roughly the size of the entire economy of Germany. The problem is how we choose to spend it.

We also must restore performance-based pay. The idea that people should benefit from their hard work is a cardinal belief of capitalism, but there is ample evidence that it hasn’t held true for quite a while. Productivity growth has far outpaced wage increases in the U.S. going back to the 1970s.

This appears to be a global phenomenon. The International Labor Organization (ILO) looked at 36 countries and figured that average labor productivity has increased more than twice as much as average wages since 1999. Some have disputed this argument, but we can’t deny that wages are going nowhere. According to the Bureau of Labor Statistics, real weekly earnings in the U.S. in March were a mere $1.82 higher than a year earlier. Generally, workers are losing ground to capital globally. The ILO has shown that wages’ share in GDP has decreased in recent decades, meaning that the regular worker isn’t benefiting as he should from economic growth.

There are many factors behind this trend, including the formation of an international labor market. But globalization itself isn’t the problem—it’s how the benefits are being allocated. Corporate management doesn’t seem to care so much about shareholder value when paying themselves. Professor Steven Kaplan noted that in 2010 the average CEO of a major U.S. company earned more than $10 million, or about 200 times more than the typical household.

Companies also have the money to raise wages: They just choose not to give it to their employees. Rating agency Moody’s recently reported that U.S. non-financial companies are sitting on $1.64 trillion in cash. Companies also spent $476 billion buying back their stock in 2013, 19% more than the year before.

The question is: How get management and shareholders to disgorge more corporate profits to their employees? There isn’t an easy answer. William Galston, former advisor to President Bill Clinton, once suggested tax rates should be linked to a company’s worker compensation strategy (though that strikes me as a bit too intrusive). The ILO recommends we support stronger collective bargaining to allow workers to fight for their fair share of corporate profits.

But the crux of the problem is the idea of shareholder value. How do we convince shareholders and management that higher wages are positive for the long-term prospects of their corporations? Maybe we should consider altering the way we tax capital gains. Rather than breaking them down into two main categories—short and long term—it might help to decrease the rate the longer the asset is held. That would encourage longer-term shareholding, and perhaps make owners more interested in the long-term outlook for the companies in which they hold shares. I also think we should rebalance tax rates between capital and labor. I understand the principle that low capital-gains taxes reward people for wise investments. But what about rewarding people who work hard at their jobs every day? The Organization for Economic Co-operation and Development noted in a report this month that the tax burden on wage earners has increased in most of its member states in recent years.

These are just suggestions, and I’m interested in hearing more of them. The basic point is that we have to take steps to improve both the outlook for corporations and the many ordinary employees who work for them. The game should be win-win, not zero-sum.

Technology & Media

Microsoft’s Brand New CEO Needs to Do Much More

Satya Nadella
Microsoft CEO Satya Nadella speaks at the Build conference on April 2, 2014 Harry McCracken / TIME

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This post is in partnership with Fortune, which offers the latest business and finance news. Read the article below originally published atFortune.com.

How does a CEO grab attention when he’s the follow-up act to a brash, voluble leader like Steve Ballmer? For Satya Nadella, who hardly seems prone to the same kind of sweat-soaked stage performance of his predecessor, the answer lay in a bold strategic gesture: Get Microsoft Office onto the iPad.

Office, of course, had long been Microsoft’s great cash cow fenced off from the green pastures of the tablet market. Some believed it was the reason Microsoft started making Surface tablets after decades of not manufacturing personal computing devices. That expensive experiment hasn’t exactly delivered a hit. Surface sales are growing, but its 2% market share lags those of Samsung, Amazon’s Kindle Fire, and of course the iPad.

With Nadella taking the reins from Ballmer, Microsoft has the chance to begin a new era — distinct from the Ballmer years that saw modest growth and a move into enterprise software, and even more remote from the Gates years when Microsoft ruled PC software with an iron fist. Nadella’s Microsoft appears to be a company that aims to compete in markets rather than control them.

MORE: Nadella: Microsoft needs a ‘data culture’

Nadella’s experience is aligned with the same technologies that promise future growth — cloud computing, multi-platforms, mobility, big data — the antithesis of the proprietary software that Microsoft built its historical success on. That’s why the Office 365 for iPad announcement was notable. It wasn’t so much two longtime enemies sharing revenue. It was Microsoft risking its own mobile platform by expanding to another, bigger platform. It was a Microsoft open like never before.

The announcement was also Nadella’s first big public appearance, a product launch cum CEO debut. The move was a risky one: It could telegraph that Microsoft was capitulating to Apple, running its prized wares on its old rival’s device while paying a 30% share of revenue for the privilege. Increasingly, Nadella is instead being seen as a leader who can finally usher the company out of the PC era and into the cloud economy.

Last month, when Microsoft announced that Office apps would be available for the iPad, the news stirred a ripple of notice. Analysis was mixed. The New York Times wondered if it wasn’t the right move too late. Techcrunch found it to be worth the wait. Someone at Forbesdismissed it as a non-game changer.

After a few weeks in the App Store, Office for iPad is proving the early skeptics wrong. More than 12 million people downloaded Office Apps in the first week. Today, Word, Excel, and Powerpoint are the three most popular free apps in the iPad App Store (excluding games, which shows that tablets may be better for idleness than productivity). The basic apps are free for bare-bones functionality, but a subscription to Office 365 opens up more features.

For investors, the arrival of Office for iPad is unlikely to translate into material earnings, at least any time soon. It may open Microsoft to businesses that prefer tablets over traditional PCs, but it could also cannibalize the company’s older, high-margin markets. Desktop and laptop sales have been declining since the iPad’s introduction, although recent months have shown signs those declines are stabilizing.

MORE: For Microsoft’s Nadella, signs of leadership potential

If the move has little short-term benefit for Microsoft, its symbolic value is higher. CEOs of prominent companies like Microsoft often set the tone of a company, and in some ways Microsoft now appears to have lost the cloud hanging over it when Ballmer was there. Ballmer, of course, also worked to push Microsoft into a more open direction, but somehow Nadella’s presence makes it seem like it may finally be happening.

Office, of course, is only one part of Microsoft’s business. It’s the prime contributor to the company’s business division, along with Sharepoint and Exchange. That division makes up a third of Microsoft’s revenue and three-fifths of its operating income. But growth in the division has been flat — revenue rose only 2.5% in Microsoft’s last fiscal year (ended June 2013) and declined 6% in the last six months of 2013.

Microsoft is seeing faster revenue growth in its server and online services divisions, although these segments have much lower margins. (The online division has been a perennial money loser.) So while the Office move is seen as a symbolic victory for Nadella’s Microsoft, the company is still weighed down by many of the same old issues: an enterprise software market and the aging business in PC operating software.

Office for iPad is a strong start to Nadella’s follow-up act to Ballmer. But it will need to be followed by a lot more creative, bold moves to change Microsoft into the dynamic, future-oriented company that investors are hoping it can become.

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