The Curse of
the Internet!

Sehizadeh, Saeed
THE CURSE OF THE INTERNET
CreateSpace (206 pp.)
$14.00 Paperback, $7.80 e-book
November 21, 2011
ISBN: 978-1467944564

A sober, data-rich survey of issues affecting job creation in the era of the Internet.

Sehizadeh�s debut doesn�t claim that the Internet is single-handedly taking jobs from the American economy, but it does convincingly draw parallels in a number areas where technology limits job recovery. The tone is urgent but nonhysterical, and the snapshot of job recovery issues is compellingly comprehensive. Sehizadeh, an Internet businessman, surveys a wide range of economic sectors where jobs will come back slowly
or not at all. Each industry held up for inspection increases the heft of his argument. For instance, a tour of manufacturing will be eye opening and fascinating to the layman, even if it overlaps only peripherally with the Internet question. But the point is made; the jobs are already gone, and advances in robotics ensure they will not be coming back. Cut to the Internet economy; when brick and mortar bookseller jobs are lost to pressures exerted by an Internet behemoth like Amazon, they return only in small numbers as the winner expands. Online companies tend to employ fewer people for the revenues earned. Even if the revenues are there, the human workers may not be�replaced by automation. So we see the market hit highs while employment continues to seek new lows. The author hammers away, giving examples from retail, manufacturing, legal, publishing and more, vividly painting a landscape of empty shopping malls and magazine titles that exist only to history now. The picture is bleak, and there is reason to think the 21st-century recession is unlike any other. But Sehizadeh also deftly spells out a collection of steps we might take to more realistically face the challenges of job creation that could be the starting point for a constructive dialogue about job creation. A fact-filled appraisal of the job-loss abyss America finds itself in that�s grim but not hopeless; compelling and timely, it deserves to be considered by anyone interested in jobs, technology and the American economy.

Saeed Sehizadeh was born in Iran and immigrated to the US in 1977 after finishing high school. He earned a Masters Degree in Mechanical Engineering in 1984. At the time, the defense industry went thru a shakedown and he worked as an engineer for two years. While he had enjoyed his Engineering education, he hated the work. By 1986, he had secured a job as a temporary employment counselor at a temp agency in Southern CA.

In 1988, George Herbert Bush became president. Bush immediately started to confront the problem of non-performing loans on the books of hundreds of Savings and Loans across the nation. The Federal agency tasked with dealing with the Savings and Loan problem was The Resolution Trust Corporation (RTC). The RTC was a US owned asset Management Company, charged with liquidating assets, primarily real estate related assets such as mortgage loans that had been assets of the savings and loan associations (S&Ls). Between 1989 and mid-1995, the Resolution Trust Corporation closed or otherwise resolved 747 thrifts with total assets of $394 billion.

The largest of those savings and loans was Gibraltar Savings in Simi Valley, CA, which would become the largest client of Mr. Sehizadeh�s temp agency. He started the temp agency in 1989, shortly before the Federal Government took over the savings and loans industry. Because the Federal Government took over Gibraltar Savings, many of the existing employees left the company, necessitating the hiring of many temporary employees. Furthermore all of the loan portfolios in all savings and loans had to be evaluated to determine if they were performing or non-performing loans as a precondition for sale to investors.

Gibraltar Savings was not alone. Almost all savings and loans in Southern CA experienced the same problem: most of their loans were not performing. The problem was the result of these institutions� lending based on guidelines that didn�t take into account the borrowers� capacity to pay back the loan. When the loans became non-performing, almost all savings and loans became insolvent, and the RTC took them over. Most of these institutions became Mr. Sehizadeh�s clients and his temp agency provided the personnel to audit the loans as the RTC required.

By 1995, the savings and loan mess was coming to an end. The RTC was able to separate the performing and non-performing loans on the book of savings and loans. The Federal Government basically took over the non-performing loans and sold off the performing loans to banks.

This opened the door to the next chapter of Mr. Sehizadeh�s temp agency where he filled temporary jobs at various banks across the nation. His main client was now Countrywide Financial, which would later become the largest subprime lender in the nation. It was during one of these jobs that he realized the looming unemployment disaster that was about to unfold.

By the year 2000, the Internet was starting to become visible and widely used. There were area of the country that still didn�t have access, but it was now mainstream and quickly gaining ground.

Mr. Sehizadeh had placed a temporary employee at a bank in Southern CA. His job was to calculate the amortization data on various loans. Before he placed this employee on the job, about five or six employees were assigned the same task. To calculate the amortization of a loan, it took about half an hour to an hour to do the task, depending how mathematically inclined the worker was.

However, this enterprising employee had developed an algorithm on the web and was able to calculate the amortization data within minutes. The bank immediately fired all their other employees because this one employee was doing the job of six employees. When Mr. Sehizadeh discussed the matter with this employee, the employee explained how he�d been able to write a simple program at home, host it on his servers and use the program at work to expedite the calculation.

By 2002, the banking industry was already shedding jobs and like many whose businesses had fed off of the subprime loan market, Mr. Sehizadeh was forced to shut down his temp agency. Subprime loans had become exceedingly common as the subprime lending criteria was non-existent. Regardless of the borrowers� ability to pay or his credit worthiness, they were given loans. These loans were then packaged and sold to Wall Street, to be sold to investors later.

By 2002, Mr. Sehizadeh realized he must own something on the web. After several failures, he started an Internet company that primarily served lawyers that is still active today.

In Oct of 2007, the stock market had once again made headlines as it was trading at record levels. The S & P was trading at about 1575. By then, the job market was showing signs of slowing down, though the government was denying any problem.

By March 2009, the market would tumble to half its value from its height. While the financial crisis and the faltering of the subprime loans have been offered as the culprit, the rationale remains faulty. While the financial crisis may have contributed to the decline in the market, it can�t be the only reason. The Wall Street executives are not aware of this fact either. In the ensuing subpoenas and testimonies before the senate, not one of them offered the Internet as the reason for the demise.

It was in 2009 that Mr. Sehizadeh started this book: The Curse of the Internet, to shed some light on the real cause of unemployment. The politicians all agree that creating jobs is the main task at hand. Many propose cutting taxes to create jobs, while others suggest more absurd solutions. The reason such faulty logic is at play is because none of them understand that it is the Internet causing unemployment. Mr. Sehizadeh�s book aims to provide that missing link.

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