Rick's Wrap-up

I left my first Milken conference impressed and intellectually whipped. I have attended some great events in my lifetime; few rival Milken in terms of planning and execution.

I sat with the senior economist for Deutsche Bank at lunch on Tuesday; this was his fifth conference. "The problems discussed are pretty depressing," he said. "But everyone around here is so optimistic and happy. I balance the depressing with the optimistic and leave feeling good about the world."

What's clear is that there remain more than enough problems to address -- and more than enough energy, intellect and creativity to do so.

Our bloggers captured the energy and stimulation of the conference. Hopefully we caught the optimism, as well.

Nutrition and the Marketplace

David Heber, author of "What Color is Your Diet?" moderated the session "The Coming Health Renaissance and the Role of Nutrition," which focused on how the marketplace is responding to the obesity epidemic and consumer demands for healthier choices. As Heber said, "It will take consumers voting with their pocketbooks to change the food supply."

Brian Cornell of Safeway gave the view from the grocery store, noting the fastest-growing categories at their stores are organic fruits and vegetables (up 57% in the past year), fresh fruit (+25%), berries (+23%), fresh cut fruit (+23%), and packaged salads (+14%). In response to statistics showing a 20% compound annual growth rate in organics, Safeway developed their own line of organic products. Some trends in mainstream foods: consumers are moving from low carb products to low calorie and portion control products and from carbonated soft drinks to non-carbonated beverages and water. So food manufacturers have rolled out 100-calorie packages of cookies, chips and crackers. Cornell: "Companies are moving from the food business to general nutrition business."

Bob Fell is chairman of the board of Eaturna, LLC which wants to become the Starbucks of prepared foods. The company's leaders believe America is at a tipping point with high rates of obesity and billions of dollars in lost productivity and health care costs. But there's been too much emphasis on diet and not enough on eating. Starting with the premise that you can't dramatically change the eating habits of Americans, Eaturna set out to make healthier versions of favorites like brisket, crispy chicken fingers and eggplant parmesan. Eaturna's products have 30-50% less calories and fat and, according to Fell, are fresh, healthy and delicious (and comparably priced). And Fell says one of their chefs has lost 36 pounds eating Eaturna foods. The downside: they're only available in Burbank and LAX.

Susan Trimbo of GNC noted that there's already been a health renaissance with 35-45% of Americans taking a supplement every day. Sales of vitamin D, fish oil supplements and green tea extract have increased with favorable news reports about their health benefits.

Photo: Brian Cornell. Source: Milken Institute

Energy, Water, and Global Warming--What Would the Nobelists Do?

Since 1901, a special group of individuals converge in the city of Stockholm, Sweden to receive acknowledgement for their achievements in literature, economics, medicine, physics, chemistry, and peace. Three individuals recognized by the Nobel Foundation for their accomplishments in physics and chemistry joined moderator Mike Milken for a lunchtime discussion on the most pressing current policy issues facing the United States and the world.

Panelists included F. Sherwood Rowland, 1995 recipient of the Nobel Prize in Chemistry for his work on the effects of refrigerant chemicals on the earth's atmosphere, Steven Chu, 1997 recipient of the Nobel Prize in Physics for his work in the use of lasers to manipulate atoms, and Alan MacDiarmid, 2000 recipient of the Nobel Prize in Chemistry for his work in the development and creation of organic polymers capable of conducting electrical current.

Two key issues that seem to be on everyone's minds these days are global warming and sources of energy. Global warming poses a particularly unique problem in that it is more that just an increase of the Earth's average temperature; global warming affects a gamut of natural occurences, ranging from rainfall, sea and lake levels, and ocean currents, to the spread of pestilence and disease. Although the subsequent thaw from the ice age allowed humans to inhabit the earth, the continuous thawing of the polar ice caps because of increased carbon dioxide (CO2) levels in the earth's atmosphere have the potential for catastrophic results. Mike Milken proposed the invention of a giant vacuum cleaner to suck all of the CO2 from the atmosphere to a round of chuckles from the panelists and audience alike.

Alan MacDiarmid argued that availability energy sources was the core issue upon which other pressing problems, such as global warming and fresh water supply, depend. Utilization of alternative energy sources would decrease greenhouse gas emissions and provide heat for distillation of undrinkable water. The panelists seemed to be in agreement that not nearly enough attention was being paid by the U.S. government and Americans in general, to the pressing need to adopt alternative modes of energy.

Steven Chu also indicated that in addition to the actual physical issues of decreasing fossil fuel stores and ozone depletion, Americans should be concerned with the overall decline of American achievement in the areas of science and technology. Without the intellectual capital to continue working on these problems, solutions will not be found in time. Dr. Chu's concern regarding the underachievement of Americans in science and technology fueled his participation in the seminal National Academies report, "Rising Above the Gathering Storm: Energizing and Employing America for a Brighter Economic Future."

And while all three of the panelists have already reached the pinnacle of each of their fields with their Nobel-garnering work, they all plan to continue soldier on with their works with hopes of summiting the next great discovery.

Photo: (L to R) Steven Chu, Michael Milken, Alan MacDiarmid and F. Sherwood Rowland. Source: Milken Institute

For more information on this session, click HERE!

The Future of Education?

Let's start with a stat: 67% fourth graders in the capitol city of the most powerful nation on earth cannot read. Frightened yet? How about the fact that Only 17% of 12th-graders scored at or above the "proficient" level? Me upon hearing this news. "The Future of Education: Effective Solutions to the Challenges Facing America's Public Schools," six luminaries in the education field discussed the future of education in the U.S. and what needs to be done to improve the system.

Teacher Quality
Teacher quality is by far the most important part of the education experience that education officials can control. According to Lew Solomon it is ten times more important than class size and only slightly less important than family support. What does this mean for education and our children? According to Lew, we need to stop running the inner-city school system like a farm team for the more affluent suburbs: "Most of the least experienced teachers in the public school system end up in the worst-performing schools." Follow that up with the stat that nearly 46% of teachers quit after five years and you have a bad recipe for baking fully developed young minds.

Charter Schools
"Competition improves schools and student achievement." Nina Rees promotes this idea that charter schools are the answer, or at least a step in the right direction, to our educational woes. The theory here is that if parents and students have a larger role in where and what they are being taught they become more active participants.

Educational Technology
Ron Packard: "Education has been less impacted by information technology than any other segment of our society." Fantastic. According to this panel education could be greatly improved at a relatively cheap cost by implementing a more interactive, engaging educational technology system. According to Mr. Packard, "virtual charter schools" might be the answer.

So, is this system beyond repair? No. Although there are no magic bullets to slay this particular monster, the educational system in the United States can be improved. The single biggest thing we can do as a society is become more actively involved - Rod Paige encouraged us all to pay attention to school board elections and Lowell Milken implored the audience to get the word out about the real state of education in this country. Wake up America. Remember, these kids are going to be the ones that take care of you when you're old.

For more information on this panel click here.

Are the Boomers in for a Bust?

If there wasn’t enough to worry about already, do baby boomers need to add an impending crash in stock and bond prices to the list? Didn’t former Vice President Al Gore’s talk at last year's Global Conference and upcoming film on global warming scare us enough? In the panel “Baby Boom or Baby Bomb?” panelists Jeremy Siegel of the Wharton School at the University of Pennsylvania and Mike Milken, Chairman of the Milken Institute presented the emerging trends in life expectancy, aging, and retirement.

As the number of workers per retirees falls to one for one in Japan, the big question facing the developing world is who is going to produce the goods? If there are not enough workers earning income then there are not enough buyers for stocks and bonds when the baby boomers retire. Retirement age will have to rise substantially, and golf games in Florida will have to wait. Throughout the discussion, Siegel questioned whether Americans and Europeans are actually interested in working longer and retiring later. “The desire to retire earlier is accelerating,” he asserted.

“People say I am a pessimist,” said Siegel, “But there is hope, and it comes from the rest of the world. The age wave of the developing world has about 50 years lag time from the rest of world.” So why does the fact that the developing world is so young help the boomers? Assets are exchanged from old to young. Mike Milken added that, “In China and India there is enthusiasm and energy. “If they can care for their people and create wealth that reduces the burden on us. That will spill over to the rest of the world.”

The two major trends affecting this issue: the growing middle class in the developing world, and a chronologically aging population in the developing world. Mike Milken asserted that life expectancy is one of the important things to watch but we also want real quality of life. He showed a job advertisement that asked that “Older Workers Please Apply.” Moderator Paul Gigot offered that the panel theme was clearly “You are not going to be your father’s Oldsmobile.”

The job market will evolve to meet the need for workers to retire later. In responding to Siegel’s assertion that people don’t want to work longer, Mike Milken offered, “I think you are confusing the issue. Many do not want to work because they don’t like the job.” Educational challenges need attention so we can meet the demands of our new economy.

Ultimately, these issues may be easier to address if our borders diminish in importance. The solution is that we live in a world economy. “We just need to assume jobs will change, health will change, technology will change. When we cure cancer alone, the average life expectancy will go up four years. There will certainly be a link between health advances and productivity,” asserted Milken.

Mama, Please Let Your Babies Grow Up to be Scientists and Engineers

Here's an assignment--grab a pen and a piece of paper and draw a scientist. All done? Let me guess--you probably drew a crazy looking guy in a white lab coat and pocket protector who is undoubtedly brandishing a test tube or beaker that is spouting flames. The problem is, you wouldn't be alone--in fact, this is the image that more than 80% of children in grades 4 through 7 would draw. However, being a scientist myself, I have problems with this perception--I rarely wear a labcoat, have never owned a pocket protector, and have only caused laboratory fires by accident (oops). In "Engaging Girls in Science," a roundtable moderated by Dr. Sally Ride, issues regarding the need to engage and encourage girls and young women to pursue careers in science and mathematics were brought to the forefront.

Back in the day when Dr. Ride was breaking down gender barriers at NASA, women scientists, engineers, mathematicians, and astronauts were almost as rare as Giant Pandas. But I have to admit that as much as science and technology drives the economy in the United States, it is still pretty sad that only 22% of physics majors, 20% of engineering majors, and 27% of engineering majors are women. These numbers are particularly striking when you examine "science interest" in 4th graders: 68% of 4th grade boys and 66% of 4th grade girls say that they like science. If this is the case in the 4th grade, why do we see such a dramatic drop-off in girls' interest in science in middle school, high school and college?

Jane Swift, former governor of Massachussetts, indicated that this is clearly an area where public sector leadership is essential. It is projected that 2/3 of jobs during the timeframe 2000-2010 will require a science background. If barely 25% of America's women are graduating with science and technology-oriented degrees, what does that say about their contribution to the workforce? Are we inadvertantly forcing young women into "traditional" careers by not encouraging women to pursue interests in science? Is this really what Swift calls the "quiet epidemic?" The data clearly indicate that women are not pursuing careers in science and technology--do we really need a catastrophe for our government leaders to recognize this as a problem? And why all of a sudden has the focus on the educational needs of girls created a backlash regarding the needs of boys?

Ronald Packard challenged roundtable participants to not only consider the issue of keeping girls interested in science, but also the overall downward spiral of American students in science and mathematics. In fact, the United States currently ranks 19th out of 21 nations in high school physics achievement. But clearly, young girls are lacking in role models. Packard's organization, K12 Inc., has established programs in cities such as Philadelphia that strive to provide role models to public school children in science and technology. Now, this doesn't mean that the 5th grader with an interest in chemistry receives a book on Marie Curie. Instead, K12 Inc. seeks out local scientists and engineers, real people in the students' home town who can serve as real, live role models.

Stephanie Rafanelli provided the "in the trenches" perspective for the roundtable--she is a 7th grade science teacher at the Menlo School and grapples with the issue of keeping girls interested in science on a daily basis. Trained as a computer scientist, Rafanelli feels that there is an overwhelming lack of attention paid to the fundamental ideas of science in education. For instance, teachers today have access to great "science experiment kits" that allow 2nd grade classes to build volcanoes that ooze "lava," but in many cases, the teachers themselves do not understand the scientific principles behind how this kit works. How can we expect our students to understand core scientific ideas if their teachers don't even understand them? Therefore, we need to find a way to get more science majors interested in pursuing careers in education.

Overall, U.S. schools are facing a crisis of potentially epic proportions, hence initiatives such as the National Academies' "Rising Above the Gathering Storm," which seek to improve America's competitiveness in science and technology. Twenty years ago, only 8% of entering medical students, 5% of law students, and 3.7% of business students were women. Although these numbers are more balanced today, we need to find innovative ways to keep America's youth, and particularly women, engaged in science and technology-based careers. Sally Ride Science, K12 Inc., and teachers like Ms. Rafanelli are doing their best to foster the next group of barrier-breaking women scientists.

For more information on this session, click HERE!

Teaching the Digital Natives (aka our kids)

The last session I attended yesterday was the most engaging and lively yet. Featuring a mix of K-12 educators, college profs and luminary thinkers and doers, "Blogs, Wikis, MMORPGs, and YASNS: Shaking Up Traditional Education" even inspired some authentic divergence of opinion, something of a rarity at the Conference. The passion, no doubt, stems from what's at stake: our kids and how they learn.

Innovative teachers are incorporating into their classrooms technologies that are part of how our kids live: blogs, wikis, multiplayer online rollplaying games and social networking sites. These vehicles enable students to collaborate, make connections to ideas in new ways and have conversations they haven't been able to have in the past. According to George Siemens, "The kind of intellectual engagement we have been trying to foster for years in the classroom is finally going on." Doug Thomas believes firmly that rollplaying games are reintegrating imagination back into the curriculum. David Weinberger, talked about how Wikipedia is enabling new ways of connecting, learning and knowing. It's leading to an openness wherein the network rules over hierarchical authority. Via games and blogs, students make meaning together and teach each other, creating and expressing themselves in new ways.

On the university level, Liz Lawley uses blogs as a tool to adapt previously-fixed curricula on the fly. She gets info out to her classes and assigns her students to write up the results of their assignments – and comment on others' – on the class blog. She also invites other profs in for their comments. The blog creates an ongoing dialogue you can't have in only a couple hours of class a week.

So wherein lies the controversy? These technologies are forcing us to evaluate the changing role of the classroom and the lesson plan -- in short the whole act of teaching. In this new paradigm, the instructor provides guidance and keeps students safe, but is no longer the spotlight of the experience. Inherently, authority is challenged and the teacher is no longer in control.

One audience member felt stongly that kids' blogs will come back to haunt them in the future if they ever, say, run for president. The panel's response was that we need to make kids aware of the consequences of their actions, to teach them how to handle the freedom and to "think out." The question is, do we have the leadership structure necessary to handle these deeply destabilizing and disruptive technologies and step up to the task?

Another Kind of Weighty Issue

The Milken Institute Global Conference is covering its share of "weighty" issues this week but this one offers a slightly different take on the term.

"There's a handful of women gathered in front of an empty table inside the AOL Cyber Pavilion. One of them is clutching a small ivory colored book to her chest talking to the woman next to her. '...going to the market, getting fresh fruit, just simple things like walking more...' The other women are listening and nodding. None of them know each other, but people seem to have an understanding when it comes to losing weight.

The small crowd is waiting for Mireille Guiliano, author of French Women Don't Get Fat, doing a book-signing that coincides with the conference theme of health, nutrition, and aging." (Blogging Milken)

The Long and Winding Road to Medical Innovation

How can medical research funders feel confident they are making a wise investment? One way is to optimize the management and run things more like a business, offered Roy Doumani of the California NanoSystems Institute. Benchmarks and a willingness to stop a project when it is not working were also cited.

How can investors build off existing research advances? Can we trust the published literature? According to James Heywood of the ALS Therapy Development Foundation, finding replicable data is an issue that needs a closer look. “Allocation decisions are being made based on previous research results, and this needs to be examined,” he said in the “Alternative Financing Models for Medical Innovations” panel.

Panelists agreed the investment market has changed and now all of the emphasis in research is on single products and that can hit the market soon, offered Geoffrey Parker at Goldman, Sachs & Co. Roy Doumani believes more leveraging of resources needs to happen, and those giving the money need to feel more confident in their decisions.

Mike Weiner of Biophan Technologies Inc. believes venture capital has too much control over this process, and that financing alternatives do exist. “Maybe incubators are appropriate for this space. One of the missing elements for innovation is you need to know if data is real and meaningful. The product I want to produce is giving them a viable business plan,” offered James Heywood.

(For more information on issues related to Fostering Innovation see the new FasterCures report.)

Photo: (L to R) Roy Doumani, Geoffrey Parker