Listening to Warren Buffett as he discussed Goldman Sachs on Squawk Box yesterday morning, I was struck by both his eminent business sense as well as his common sense. His assessment of the securities firm and its CEO, Lloyd Blankfein, was reasoned, and was based on his many years of dealing with the company as well as his own immensely sound and proven business acumen.

Mr. Buffett understands risk and how markets work. He knows that in the world of buying and selling complex financial instruments, responsibility is a two way street. Caveat emptor. The buyers of the instruments at issue were not naïve individuals, unfamiliar with the vicissitudes of the market; rather, they were sophisticated investors, looking for a risky investment with a kick. Mr. Buffett admitted to making mistakes of his own, to failing to see the bubble in the residential real estate market. It was reassuring to hear him make that admission.

What a far cry his interview was from the experience last week of listening to the many U.S. Senators (on both sides of the aisle) grilling Goldman Sachs employees. It was plainly evident that none of the Senators comprehended the financial instruments at stake. Rather they were grasping at headlines – grandstanding, haranguing and trying to intimidate – force feeding isolated words and phrases to make theatre and to obfuscate their own enormous culpability in the real estate bubble and its subsequent bursting. Unlike Mr. Buffet who readily confessed that he isn’t right all the time, not a single Senator admitted to pressuring the banks to relax mortgage lending standards. Nor did any of them mention Fannie Mae and Freddie Mac, for which they have oversight and which have been so preposterously mismanaged.

The Federal Government is powerful, more powerful than any corporation in this country. If it wants, it can destroy a company, because it has infinite staying power and no profit motive. That is precisely what it did to Drexel Burnham, to Arthur Andersen, to Lehman Brothers. It can create an environment that makes it expedient for customers to abandon a company and for employees to jump ship. And in that way it can bring down any company if it so chooses.

Rather than admit their own involvement in the global financial crisis, Congress and the White House appear bent on finding scapegoats. Wall Street is an easy target, and the most profitable of the Wall Street firms is the easiest and most expedient target. And Congress, given its miserably poor standing in the polls, is hoping that by vilifying the private sector they will find redemption. That will not work.

Financial reform is needed. The citizens of this country would be well served by thoughtful and reasoned legislation that would mitigate the risk associated with rampant leveraging. If Congress really wants redemption, let it admit its own errors and work together with the private sector in the best interests of the people it is supposed to serve.

November cannot come too soon.

There is a large part of the U.S. economy that is not on investors’ radar screens. I am not referring to the underground economy or the barter trade economy or the money that is paid to illegal immigrants.

The invisible economy is much bigger than that. It is the vast part of our GDP that is not measured by stock prices on stock exchanges. I am talking about the “Ma and Pa” entities, the family run businesses, the real estate companies, the printing presses, the restaurants – companies not publicly held because they are either too small or because they prefer to remain privately held. They are the primary engine of job growth in this country. Many, many of them are profitable and well managed. Some of them are quite large. But most of them are small, and therein lies the problem.

As the banks continue to deleverage and shrink their over-bloated balance sheets, they must of necessity lend less. They are happy to lend to the Federal Government, which may have a dreadful balance sheet but is considered a good risk. They are even happier to lend to large, publicly traded and already well-financed corporate giants whose earnings have been improving. Fortunately, there are more and more of those companies these days which is good news. The banks are also increasingly lending to homebuyers, now that the risks have been mitigated due to lower home prices and increased down payments.

But left out in the cold are so many small companies with good business plans and positive working capital and profits. It is those companies that have been ignored or denied capital, as the banks have restructured their balance sheets. Without bank financing, many of them cannot carry on business, much less grow.

There is no lobby for this large and silent sector of the economy, no spokesperson to plead their case to the Government or to the banks for them. If they are left without access to capital, they will eventually fail and that will be a serious problem for employment growth and for sustained economic expansion.

The current burgeoning recovery in the economy is evident in the earnings of many our biggest companies in a wide array of industries, and their stock prices are reflecting the improved earnings and the stellar productivity gains achieved. But in order for the U.S. economy to recover fully, the great unwatched and unseen segment must also participate. Today much of that part of our economy is still in recession and without the banks serving them as banks should, they will remain there.

It’s all about the delta in the economy. That is, those little bits of change that add up and have the potential to make a meaningful impact – for better or for worse.

We are seeing positive delta all over the place in the U.S. economy. On the job front, the employment numbers are getting better. On the manufacturing front, inventories are being rebuilt. On the spending front, the consumer is getting a bit more venturesome.

If you go to Craig’s List, you will see that the job postings are steadily on the increase. Try to find a carpenter (as I am doing right now) to fix the garden fence destroyed by the storm two weeks ago, and he is busy. But only two months ago, he called wondering if there was any work he might do to bring home a little extra income. That’s positive delta.

And perhaps best of all, the state of the corporate balance sheet in the U.S. is healthy, really healthy. That, together with the astounding productivity gains they have been achieving, may encourage companies to increase capital investments. That would certainly provide more positive delta.

But we all know that delta can work both ways, and we need to keep our eye on what negative delta might also be out there to offset the brightening economic picture.

Here’s what comes to mind. Will China continue to be the engine of growth in this recovery? If so, then the delta force will gather strength. If not, if in fact China’s growth is peaking, we could be in for a nasty pullback.

Will there be negative delta as the Federal Government stimulus program comes to an end later this year? It is hard to believe it won’t have some impact, but if the private sector has developed enough of its own momentum, maybe the two will wash each other out. That would be good news, because private sector demand is more sustainable and more profitable than Government stimulated demand.

What will be the impact of the cessation of the $8000 tax credit for new home buyers at the end of this month? Most likely, it will be negative delta on home sales and home prices.

What will happen when unemployment benefits start to run out? Will the delta impact be negative? Or when the census workers are no longer needed? Or what if oil prices sky rocket? For sure that will be force negative on the consumer’s pocketbook. Or if interest rates head up too soon and too fast? A few small negative bits of delta can also add up.

It’s all food for thought. But for sure right now, there are more positive bits of delta than there have been for the last two years.

In his Op-Ed piece in Tuesday’s (March 2) New York Times, Congressman Harold Ford, Jr. opined that the reason he was unwilling to run for U.S. Senate in New York was that “a brutal and highly negative Democratic primary…….[would end up] where the winner emerges weakened and the Republican strengthened.”

I think the Congressman is wrong. Harold Ford, Jr. is a leader among the truly centrist and independent political figures today, and I think he would be surprised at the bipartisan support he would receive from voters in New York.

I say this not as a resident of the State of New York (which I am not) but as a registered Republican in the state of Connecticut. Were the Congressman running in my state, I would find him an attractive candidate most worthy of my serious consideration.

As he wrote in his article, Congressman Ford is an independent Democrat. He is also a pragmatist, a thoughtful leader, a man who listens before he speaks. And when he speaks, he makes eminent common sense – something that seems virtually impossible to find today in politics.

Harold Ford, Jr. is different from so many of today’s politicians. He is not a demagogue. His ability to rise above vitriolic rhetoric makes him a better man. Our Congress is chock full of blowhards on both sides of the aisle. The election in November will (hopefully) get rid of a host of them.

We need more legislators who are pragmatists and centrists to take the helm and provide true leadership. We need legislators who can find solutions and not hide behind obstructionist rhetoric. The fringe elements of both parties today have wrested control from the silent majority. The squeaky wheels are getting all the grease, while the axle is falling apart.

Congressman Ford criticizes his own party for “having spent too much time supporting a national partisan political agenda.” The same criticism must be made of the Republican Party as well. The hidden political payoffs embedded in thousands of pages of legislative bills defy any sense of honor or standard of ethics in the legislative process in Washington D.C. Americans are being hoodwinked by their elected representatives and they have had enough of it. Members of Congress have come to realize that the day of reckoning is at hand. That is why so many of them are dropping out of the race this year.

Fortunately, there are still some honorable politicians (or is that the ultimate oxymoron). Congressman Harold Ford, Jr. has consistently been a voice of reason both in Congress and since he left the House. It is tragic that the elective process is so distasteful and destructive that it drives a good candidate from even entering the race.

It seems that almost everyone likes JetBlue and some people even claim to love the company. As well they should. JetBlue has taken the bad name out of flying and is proof positive that no condition in business is too dire to turn around.

The first sentence of JetBlue’s Customer Bill of Rights (How many companies even have a Customer Bill of Rights?) says it all. “Above all else, JetBlue Airways is dedicated to bringing humanity back to air travel.” What a bold and daring statement for an airline to make.

And to its credit, JetBlue has indeed brought the humanity back to what has become an almost excruciatingly unpleasant experience – the attempt to get from one place to another by air.

Several days ago, as I planned to fly on JetBlue on a short round trip to Florida, I took note of an alert on the company’s website. It was a recommendation that because JetBlue “had just completed transitioning to a new reservation system, wait times and line at the airport might be longer than usual.” They suggested I get to the airport two hours before the flight.

That meant getting to JFK at 6:15am rather than 7:15am. I followed their advice. But I need not have. The system for checking in was efficient and pleasant. It has been designed so that the traveler, increasingly a media/technology savvy individual, can handle everything – from checking in, to putting one’s own luggage on the conveyer, to changing a seat, to deciding if one would like to spend $25 extra to get a bit more leg room. The people who are there to help are friendly and jovial.

Within ten minutes of arriving at the terminal, my luggage was checked and I had completed security clearance. I had plenty of time to get a cup of tea and enjoy the laid-back, almost college campus atmosphere of JetBlue’s giant terminal. Efficient cafeterias offered healthful selections that included organic quinoa and Mediterranean pickles. The choices seemed endless.

Everything about JetBlue is different from all the other airlines, and that’s what makes it so wonderful. The very egalitarianism of its seat configuration makes for an ambience of camaraderie. No cordoned off section called First Class where drinks are free and food is served. On JetBlue’s airplanes, entertainment is the substitute for differentiated classes and differentiated treatment. And everyone loves entertainment.

Yesterday, on my return flight to JFK, I watched curling at the Winter Olympics in Vancouver, Stephen Colbert doing his Vancouverage, Wolf Blitzer on CNN and Bill O’Reilly on Fox. All in the space of two hours and it was live. By the time I landed, I was relaxed and entertained. Admittedly, my book, Game Change, lay unread on my lap.

The flight attendants on JetBlue flights are not only friendly, they are comedians in training or better. Each one of them brings his or her own sense of humor to their communication, from telling jokes to suggesting that someone come and take over their position because they would prefer to stay in Florida and not head into what will be another giant snowstorm in New York.

Okay, there are a few inconveniences. The seats don’t go back very far which makes the normally compulsory nap a bit less enjoyable, but watching Stephen Colbert kept me from getting remotely sleepy.

I am sure that there are plenty of people who have a complaint or two or even more about JetBlue, and yes, I can admit to some long delays when I wanted to speak to an agent because of weather problems. And there are probably many who will never forget the harrowing experience of 2007 when over 1000 JetBlue flights had to be cancelled because of a snowstorm. That event itself would have killed a lesser company. But it didn’t kill JetBlue. The company learned from its mistake and has grown and today a still growing transcontinental success story.

Good companies are not created out of thin air. They are built by individuals – people with a vision and with leadership. The top management at JetBlue has changed since its inception in 2000, but what each new CEO has done is continue to foster through the company’s employees the culture of ‘bringing humanity back to air travel.”

Thank you, JetBlue.

p.s. In the interest of full disclosure, I have never met any one of the management of JetBlue nor have I every owned the stock of the company.

p.p.s. Isn’t this the kind of company that Warren Buffet should love?

President Obama’s support of nuclear power generation in the U.S. should be welcome news not only to the utility industry but to the nation as a whole. Despite its carbon free emissions, nuclear energy has been a dirty term for the last thirty years, since the Three Mile Island accident in 1979.

Hopefully President Obama will be able to break that spell. In his State of the Union message less than a month ago, he spoke of the need to build “a new generation of safe, clean nuclear power plants in this country”.

And the President has backed up that proclamation with the announcement yesterday of $8 billion in federal loan guarantees for Southern Company’s two new nuclear reactors. That action was key because the capital needed up front to build new nuclear power plants in this country has become so prohibitive that without Federal loan guarantees, there would be little incentive for the private sector to take the risk.

Thank you, Mr. Obama for lending credibility to your stated support for clean nuclear power generation.

But ultimately, the nuclear power industry will need to be able to produce and deliver nuclear energy without Government support. That should happen if enough plants are approved to create a viable vendor industry – supplying turbines, reactor parts, pumps, generators and on and on. I believe that can happen.

Let’s remember also that in a nuclear power plant, the upfront capital costs relative to the operating costs are far higher than in a coal fired plant. So once a nuclear plant is up and running, the marginal costs are small and very predictable.

In the interest of full disclosure, I should point out that I sit on the board of a publicly held utility company which does not own any nuclear facilities.

To quote Lewis Carroll (or perhaps the Walrus), “The time has come… To talk of many things.” It appears that finally after a hiatus of more than thirty years, we are able again to talk of nuclear energy.

For those who fear another Three Mile Island or worse, another Chernobyl, it may help to look to France as an example of a country that embraced nuclear power as the solution to the energy crisis way back in 1973 after the first oil crisis. Today nearly 80% of the country’s electricity is generated from its 59 nuclear plants and they continue to build new plants. And rather than being reliant on foreign oil, the country exports nearly 20% of its electric generation.

The French have addressed the issue of nuclear waste by recycling. They create new fuel rods from unused uranium, thus greatly extending the life of the rods and ultimately generating far less waste.

For thirty years, nuclear energy has been the ‘third rail’ of the utility industry – basically untouchable. It was one of those issues that was so fraught with emotion that Washington didn’t want to go near it. Democrats, in particular, railed against it, while Republicans gave it lip service.

Today President Obama has dared to touch that third rail. That is leadership and he is to be congratulated. Years from now, the American public will look back on his leadership in this matter and be grateful.

Yes and No!! That’s the honest truth and that’s the way it’s been throughout history in an innovative and vibrant economy like ours in the U.S. Some jobs constantly disappear while new ones are being created. Unfortunately, the job destruction part often comes harder and faster than the job creation part.

Just a decade ago, we experienced the Dot.com bust in this country. The “new” economic paradigm came crashing down and the “old” economy survived despite its foretold demise. The bloated workforce dedicated to an industry that seemed to go from infancy to adulthood in the span of less than five years, found itself decimated. Those Dot.com jobs have not been restored. But the technology that spurred the meteoric rise of the Dot.com industry did not die. And steadily over this last decade, continued advances in the area of telecommunications have spawned innumerable jobs in our economy.

A decade before that, we experienced the S&L crisis, where a large number of savings and loan organizations met their untimely demise through their own mismanagement. That was just as their future seemed glorious in the aftermath of the industry’s deregulation by Congress. The housing industry came to its knees. But it did not die; slowly and steadily, after the bloated inventory of second and third homes became absorbed into the economy, housing once again became a vibrant industry.

And only ten years before that, we lived through the rise and fall of the energy industry. With oil prices hitting $40 per barrel in 1980, (that was the equivalent of over $100 today) workers in the northern states were leaving “the rust belt” as the manufacturing heartland of this country was dubbed, to head for the “gold” in the oil fields of Texas. The migration was huge, raising real estate prices in the Southwest and decimating them in Michigan, as auto workers became oilfield workers. And then hardly a year after the peak in prices, it all ended. The price of oil came crashing down and oilfield millionaires turned into oilfield bankrupts. Homeowners abandoned their mortgaged houses and the State of Texas was the least exciting place to live.

This go round is really no different in its nature. An industry, in this case the banking/mortgage industry, brought about its own destruction. By using borrowed money with abandon in order to grow, by encouraging its customers to pile on debt and by lowering its own standards for lending, the banking industry sowed the seeds of its current crisis. Now, as the industry shrinks from its bloated size, it is shedding employees that were needed only when it was overweight. A trimmer industry will emerge and some people will be hired back, but not to the levels of just two years ago.

But fear not, the spirit is willing even if the flesh is weak. That entrepreneurial spirit is alive and well in the U.S. New industries will arise and they will create new jobs – green jobs, telecommunications jobs, jobs in industries without a name as of yet. It will take time and that is the frustrating part. And a decade from now, a new economic crisis will raise its ugly head to prove yet again that trees do not grow to the sky.