Good companies benefit from good regulations

The New York Times had an article on a small group of business in Toledo that thought less regulation would help their businesses.

See “The President Changed. So Has Small Businesses’ Confidence”, Landon Thomas Jr, 2107-03-12
2017-03-14'

Many people fail to realize that government makes businesses run more smoothly because it levels the playing field by keeping other businesses honest.  Government is the force that reduces externalities.

Does a quality restaurant want to compete with a sloppy restaurant that has unsanitary conditions, pays extremely low wages, and just dumps its garbage anywhere.  Food inspections have saved lots of lives and protected other restaurants from unfair competition.

Does a trucking company that follows safety laws want to compete with a company that overworks its drivers who are encouraged to speed.

Does a quality manufacturer want to compete with a manufacturer who cuts costs by avoiding a lot of safety practices?

Does a food processor want to face a law suit from a person who has a really bad reaction because the company didn’t follow government labelling regulation?

Does any company want to do business with a bank that doesn’t keep a government-mandated reserves?  It has happened over and over again that people and companies have lost a great deal of money when a bank went belly-up.  The Federal Deposit Insurance Corporation (FDIC) has certainly reduced the losses of many a company.

If a government didn’t enforce certain standards of safety and fiduciary responsibility, would more businesses be looking at costly law suits?  By showing that they were making every effort to follow the regulations, wouldn’t they blunt these suits, especially if they kept good compliance records.

And well-run companies will also pay less insurance than their slap-dash competitors.

Oh, yes, I almost forgot patents and copyrights.  Boy, lots of companies would be screaming bloody murder if their intellectual property wasn’t protected by government registration.

Trump gives new meaning to "political" science

Trump's staff is toying with taking climate research responsibility from NASA and giving it to another agency.

That is, those with business and law degrees know more about science than those with physics and chemistry degrees.

See "Earth, the Final Frontier", Adam Frank, New York Times, 2016-12-02
http://www.nytimes.com/2016/12/02/opinion/earth-the-final-frontier.html.

Do we really have a five-party “system”?

Many commentators write about the “two-party system” as if it were enshrined in the Constitution.  Actually, the writers of the Constitution feared factionalism.  They thought their document would bring about a system of considered deliberation and reasoned arguments.

Unfortunately, factionalism reared its ugly head quite quickly.  John Adams, a signer of the Constitution, and Thomas Jefferson, a non-signer, soon fell into animosity about the direction of government.  They did reconcile their differences in their elder years, but their dispute lingered in the Whig and Democratic parties.

The Whig party went into decline when several Whigs formed the Republican Party, partly because of opposition to the extension of slavery and partly because of support of modernization.  Ironically, one of the Republican slogans was “Free Labor” as opposed to slave labor.

Over time, the parties’ basic tenets changed with changing times.  The Republicans essentially became the party of Big Business and the Democrats became the party of the People.  But these were not fixed ideologies.  The parties adjusted their ideas to the times.  Republicans put forth ideas that favored a “government for the people” and the Democrats put forward ideas that were corporate-friendly or status quo.  Many commentators referred to the two parties as “big tent” parties; that is, all were welcome if they held loosely to a few basic tenets.

Then somewhere in the eighties or maybe even earlier, the Republicans morphed into a hard-nosed, doctrinaire party.  The days of the RINO (Republican in Name Only) began.  Some very stellar Republican politicians who got things done for the greater good were no longer welcome.  The Republicans also drew in many evangelicals who knew exactly what God wanted; just the kind of religious influence that the signers of the Constitution worried about.  The signers were very aware of the differences among denominations and didn’t want to favor one over the other.

The result of all these changes have left many would-be voters, and even regular voters dismayed.  As the parties have hardened in their stances, many people see government as dysfunctional and more partisan than deliberative.  Remember that phrase describing the U.S. Senate as “the greatest deliberative body in the world”?  I’ll agree to the “deliberate” part, “deliberate” grandstanding for minor electoral advantage.

Back to the signers of the Constitution: I think they had in mind a constituency who knew the men they were electing, if not personally, at least by reputation.  Now we know our candidates by the slick literature they send out and the amount of TV exposure they get.  Unfortunately, third parties spend millions smearing the candidates based on private interest, not the public good that the candidates may promote.

My solution to all this mismatch of ideas and actions is either all candidates are independents selected on the merits they project or candidates are loosely organized into parties that reflect their own interest.

My choices for parties would be Libertarian, Business, Evangelical, Charity, and Common Good.

The Libertarian Party would be almost anti-government.  To them, the individual is primary, government just gets in the way of freedom.  Taxes are just stealing money.  Laws are for other people.

The Business Party would be all in support of large corporations with a bit of a sop to small businesses.  Taxes and regulations just get in the way of corporations “returning value” to their shareholders.

The Evangelical Party would be Bible-centric and would pass laws pushing for more religion in government and for how all should behave, both in public and private.

The Charity Party would take up the causes of those groups who they feel are disenfranchised by government or society.  This Party is difficult to criticize because there are many people with problems that they did not create.  On the other hand, many people in a given group have managed without the Charity Party’s help.

Finally, the Common Good Party is my party (if I were to cease being a Party of One).  This is the party that takes seriously “General Welfare” and “Common Defense” in the Constitution.  The Common Good Party is concerned with infrastructure, safety regulations, commercial laws, and many other laws and expenditures that help promote a prosperous society.

The Libertarian Party ignores how much it depends on government.  What if a libertarian had been defrauded.  Would that person depend on a tax-supported court to seek reparation?  Or would the Libertarian have it out with six-guns on the streets of Laredo?

The Business Party is similar to the Libertarian Party with the emphasis on large organizations rather than individuals.  But would a modern corporation survive without public schools to train a large number of people in increasingly complicated skills, without roads to move its goods around, without police and courts to seek redress for those who would harm the corporation?

The Evangelical Party seems to pick and choose what Bible verses to use.  Two that it seems to me that they ignore most are “Be not like the hypocrites who pray in public to be seen by men…” and “Let he who is without sin cast the first stone.”  One could also say the writers of the Constitution were all to familiar with the picking and choosing done by various sects; that’s why they wanted “no religious test”.

The Charity Party’s hearts are in the right place, but the number of problems is so large that many people can’t put their hearts and souls into all those the Charity Party thinks are important.  Government does need a few members of this party just to keep some of issues on the table.

We probably will never have a single Common Good Party because people never agree on the priorities.  This gets back to the Constitution which didn’t really define “General Welfare”.  We do need to have more people who run for office speak out for the common good rather than promote a private interest.

Mel keeps wishing for a majority government, but he keeps seeing a minority voting.

Incomplete quoting to fit ideology

Many who want government to stay out of corporate affairs quote Milton Friedman with “The only purpose of the corporation is to maximize shareholder value.”

However, he actually had a more nuanced statement:

"There is one and only one social responsibility of business--to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud."

See “The Benefits and Costs of Social Investing”, Alex Brian, Morningstar, 2015-01-07.

Too many forget everything after “so long as it stays within the rules of the game…”

Also, who should be the arbiter of “the game”?  The Chambers of Commerce?  But Chambers interests are those of its members.  Government?  Horrors!  Who else do we have that could be “impartial”?

Note my use of “could” rather than “can”.  Too many corporations work to get government to make decisions favorable to themselves without regard to the “General Welfare” stated in the U. S. Constitution.

What we have is that the “rules of the game” as manipulated by corporate interests often lead to lots of “deception or fraud”.

Is business experience a qualification for government office?

Some Republican candidates are running for statewide office in Minnesota.  See
http://www.startribune.com/opinion/commentaries/270538031.html and http://www.startribune.com/opinion/commentaries/270412441.html.  They claim that their business experience makes them better qualified for government service.

Adam Smith seems to have thought differently.  He said that those who live by profit are not to be trusted because they have often “deceived and oppressed” the public.

See “The Invisible Adam Smith” for more about this.

If government is so bad then why…

...do so many companies try to get government business?

Privately run prisons
Military contracts
Highway and bridge contracts
Private schools with government vouchers
Sports stadiums with tax money

And to boot they want government to protect their businesses with

Courts to adjudicate disputes among companies
Courts to protect copyrights with large judgments against individuals (what's this about tort reform?)
Enforcement of patents
Trade negotiations
Employees educated and trained at government expense

I'm sure you can think of many more things that governments want from government without paying any taxes to support their wish lists.

Like a little kid, they want the tooth fairy to leave a quarter under their pillow every morning.  That's a quarter million or even a quarter billion.

Pulltab predictions, mining, public interest, and bought politicians

I've been busy with submissions today.

The Star Tribune had an article today on the grossly overestimated projections for revenue from electronic pull-tabs.  See "Gambling firms drove flawed Minnesota e-pulltab funding plan", Jean Hopsensperger, Star Tribune, 2013-03-24.

I wrote a letter to the editor with the Adam Smith quote warning about laws and regulations being submitted by business people.

The Reader Weekly had a feature article by Jim Lundstrom, Scene Newspaper, about the opposition to the rushed, loose legislation in favor of a not-well-known company to mine in the Penokee Mountains in northern Wisconsin.  The opposition states that the proposed mining will be an environmental disaster that will make the area unlivable.  In response, I submitted "The Invisible Adam Smith" that I published last October.  Because the Reader Weekly republishes articles from several sources, they might republish this.  Besides, Bob Boone, the publisher and editor, occasionally asks me about writing something.

Gov. Scott Walker's desk sign, "Open for Business" was a clear warning of what was to come.  This was a clear statement in favor of those "who have generally an interest to deceive and even to oppress the public…"

Why state secession is a bad idea

Several petitions are under way for various states to secede from the Union.

Be careful what you ask for.

What the proponents of secession ignore is that the United States is and has always been a country with a mobile population.  Not only was the United States started by people who moved from other countries or their descendants, but these people kept moving west, often overrunning people already there.  In the Twentieth Century people moved in almost every direction.  Small town people went to the big city.  People moved from one city to another to seek different opportunities.  Corporations moved people from state to state for many reasons.  I myself have lived in three states and my wife in six.

If a state were to secede, what would they do about "immigration"?  Would business people from other states need a passport to do business in the independent state?  Would tourists need a passport?  If no passport were required, what would the independent state do about "illegal immigration".

What about people in the seceded state?  Would they need passports to work or vacation in other states?

What about all the wars that the United States has been involved in?  Would seceded states continue these wars?  Often the states with secessionist movements have a significant portion of their populations who are bellicose.  If the seceded states were involved in their own foreign wars, would they drag the United States into their wars?

Speaking of war, wasn't it a Republican who led a war against states seceding from the union?  Isn't it ironic that some of the major proponents of secession call themselves Republicans?  Did Lincoln "die in vain"?

Pessimistic quote of the day: responsibility for business success or failure

A small BBQ chain in Richmond went out of business.  Mitt Romney used it as an example of how the Obama administration is bad for business.  He ignores that another BBQ in Richmond is quite successful, but Romney won't give the Obama credit for its success.

"Mr. Romney’s take on Bill’s seems perfectly representative of his general outlook. If a business succeeds, the government can’t share the credit. If it fails, it’s the government’s fault."

See "Bad Barbecue? Blame Obama", Juliet Lapados, New York Times, 2012-11-02.

The Invisible Adam Smith

Many who claim to be "free market proponents" cite the "invisible hand" of Adam Smith in "The Wealth of Nations".  However, Adam Smith only uses the term once, only in reference to individuals, and in the context of trade among nations. The chapter is "Of Restraints upon the Importation from Foreign Countries of Such Goods as Can Be Produced at Home".  Among the questions Smith raises is :

If a restriction benefits an industry, does it also benefit society?

As to the "invisible hand", Smith does not apply it as a metaphor for an absolutely free market, but as an indication that the acts of an individual can lead to consequences not intended by the individual.  A more complete citation than "invisible hand" is:

"[The individual] generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain; and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention." - pages 242-243

In other words, seeking his own security he may benefit society and seeking his own gain he may harm society, or otherwise, depending on the circumstances.  In no way does this describe a "perfect market".

All page references are to the PDF version of "Wealth of Nations" transcribed by the Gutenberg Project.  You can select your preferred format from http://www.gutenberg.org/files/3300.

For the most part, I don't think Adam Smith provides a prescription of how an economy works.  Instead he provides a description of what he observed worked or didn't work.

Smith only uses "free market" once, in a discussion of the bad effects of restricting exports - pages 353-354.  Woolen manufacturers wanted to restrict exports of wool so that their supply of wool would be increased.  The problem was that English wool was inferior for clothing compared to wool from other countries.  The prohibition of exports caused the price of wool to drop drastically, making it unprofitable to produce.  The "invisible hand" now works to raise the price of mutton because the farmer has to pay his costs.  That means to give the woolen manufacturers cheap wool is to give the consumers expensive meat.  So, restricting exports did not give society much benefit.

A word that Smith uses frequently is "labour", would you believe over one thousand times?  And how many times do you hear proponents of the "invisible hand" talk about labor, other than "greedy labor unions"?  Smith looked favorably on labour, both as the basis of all economic activity and how labor can be marginalized by those with power.

The opening paragraph of "The Wealth of Nations" is:

"The annual labour of every nation is the fund which originally supplies it with all the necessaries and conveniencies [sic] of life which it annually consumes, and which consist always either in the immediate produce of that labour, or in what is purchased with that produce from other nations." - page 3

In other words, without labor, nothing happens.

"The liberal reward of labour, therefore, as it is the necessary effect, so it is the natural symptom of increasing national wealth. The scanty maintenance of the labouring poor, on the other hand, is the natural symptom that things are at a stand, and their starving condition, that they are going fast backwards."

As the National Football League found out, not paying referees what they asked lowered the owners wealth.

As for those who complain about "greedy unions" and promote "right-to-work laws", consider:

"The masters, being fewer in number, can combine much more easily: and the law, besides, authorises, or at least does not prohibit, their combinations, while it prohibits those of the workmen. We have no acts of parliament against combining to lower the price of work, but many against combining to raise it. In all such disputes, the masters can hold out much longer. A landlord, a farmer, a master manufacturer, or merchant, though they did not employ a single workman, could generally live a year or two upon the stocks, which they have already acquired. Many workmen could not subsist a week, few could subsist a month, and scarce any a year, without employment." - page 142

Few seem to understand the need to balance interests.  When profits and wages are out of balance we are in deep trouble.  Given the rising cash hoard of many large corporations and the still uncertain job market, we should consider:

"It is the stock [materials, equipment, and workplaces] that is employed for the sake of profit, which puts into motion the greater part of the useful labour of every society. The plans and projects of the employers of stock regulate and direct all the most important operation of labour, and profit is the end proposed by all those plans and projects.  But the rate of profit does not, like rent and wages, rise with the prosperity, and fall with the declension of the society. On the contrary, it is naturally low in rich, and high in poor countries, and it is always highest in the countries which are going fastest to ruin." - page 142

In other words, without corporations much work doesn't get started and without labor it doesn't get finished.

Finally, Smith didn't think business people ["those who live by profit"] should be trusted in public affairs:

"The proposal of any new law or regulation of commerce which comes from this order, ought always to be listened to with great precaution, and ought never to be adopted till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it." - pages 142-143

Adam Smith was an academic who read widely, considered what he read, and wrote an opinion for the powers-that-be.  Those who consider "invisible hand" and "free market" as the only things important about economics, should consider reading more of modern economists, who have the benefit of having read all of "Wealth of Nations" and over two centuries more of data to consider.  They are no more in an ivory tower than Adam Smith was.

For a poster of "The proposal of any new law…" see "Poster: A warning from the 'Invisible Hand'".

Updated 2013-07-21 to include Adam Smith's words for "business people.
Updated 2013-08-20 to include link to the poster.

Lack of transit options is a business tax

This entry was inspired by "Southwest light-rail is good for business", Star Tribune, 2012-03-16.

Opponents of light-rail, expanded bus service, and other non-auto transit options claim that we can't afford the taxes to build these.  Some of these same people claim that businesses shouldn't be taxed.

Somehow we do have taxes to build more and more roads.  Somehow we do have taxes to police and repair these roads.  But what do more roads get us?  More congestion.  How many times do you come to a standstill at rush hour (or in large cities, on rush day)?  Do you remember 10 or 20 years ago when the freeways had fewer lanes?  Do you remember coming to a standstill maybe less than you do now?  So more roads were built and more people used them.  A sort of build it and they will come situation.

So people lose time because of traffic congestion and businesses have less ready-to-work employees.  And many employees leaving early "to beat the rush".

But for those who don't want to tax businesses, do you realize the automobile culture levies a heavy tax on them?  If a company has 1,000 employees at a location working a day shift, how many parking spaces will the company have to provide?  What is the cost of those spaces?  Who pays for those spaces?  Could the land be better used for other purposes?

Look at the suburbanization of our shopping areas.  Any business has to provide a certain minimum of parking.  And smaller businesses have to allocate so many handicapped spaces, even when the farthest general parking space is closer to the building than the nearest handicapped space in Sprawl Mall is to the main entrance!

How come the anti-government, pro-business party isn't listening to the pro-transit businesses? Especially when that same party claims businesses can do things better than government?

Having your cake and eating it too!

"For example, 53% of Americans believe the debt and deficits should be cut significantly... but the same percentage agrees that taxes should not be raised on anyone.

Similarly, 53% of Americans think that the influence of banks and corporations should be reined in... but that regulations on businesses should be pared back."
- "New Poll: Americans Now Think Economy Favors Super-Rich", Henry Blodget, Daily Ticker, 2011-11-08

More examples of corporate inefficiency

A local writer wrote that we don't make anything in America anymore, look around. Actually he didn't look around very well; there are several manufacturers in Duluth, Minnesota, and the United States, many of them doing quite well.

Another thing that many people don't look around for is counter-examples to the idea that businesses are efficient and government is not. If you look around, you'll find plenty of examples of efficiency and inefficiency for both businesses and government. Being a contrary sort, I look around for government efficiencies and corporate inefficiencies. Today I found two examples of corporate inefficiency.

We have our house, cabin, and auto insurance with Western National. I paid the auto insurance last month and even have a confirmation number. When I checked today on the statements for the house and cabin insurance, I found that the statement for the auto insurance had a pay button next to it!!!

I sent email to Western National's contact address and received a reply within a few hours. Give one point to WN in the efficiency column and another for courtesy. However, the company is unable to remove the pay button as the online system is not interactive with its other system. Duh! I paid via the online system!! Give WN five points in the inefficiency column. Oh, the respondent did say that the pay button will eventually drop off.

That was a minor annoyance. Microsoft has given me, and probably hundreds of other users of Office 2011 for the Mac, a major time consuming headache.

Once again I find that I am getting duplicate events on my Outlook calendar. Before this was apparently caused by synchronization with Apple's iCal. I turned off synchronization before I spent days and days removing the duplicates. Today Outlook gave me the spinning and spinning beach ball, Force Quit said Outlook wasn't responding, and before I could click "Force Quit", the beach ball stopped. That long pause left me with duplicate items once again. At least at the moment, there are two to ten or so duplicates for each item, not hundreds like before.

I have some sympathy for Microsoft programmers and support personnel having spent a few decades debugging software, my own and that of others. But I find it annoying that such a wide variety of problems exist for years, especially when the producers tout how much productivity they give the users of their software. Efficiency is not passing problems off on customers, or is it?

When did we go wrong?

"THE THIRD charge against the House of Representatives is, that it will be taken from that class of citizens which will have least sympathy with the mass of the people, and be most likely to aim at an ambitious sacrifice of the many to the aggrandizement of the few. Of all the objections which have been framed against the federal Constitution, this is perhaps the most extraordinary.  Whilst the objection itself is levelled against a pretended oligarchy, the principle of it strikes at the very root of republican government. The aim of every political constitution is, or ought to be, first to obtain for rulers men who possess most wisdom to discern, and most virtue to pursue, the common good of the society; and in the next place, to take the most effectual precautions for keeping them virtuous whilst they continue to hold their public trust."

- Alexander Hamilton or James Madison, Federalist No. 57, "The Alleged Tendency of the New Plan to Elevate the Few at the Expense of the Many Considered in Connection with Representation", New York Packet, 1788-02-19

"Public good" or "common good" appear 26 times in the Federalist Papers.  "Business" appears 26 times but almost always in the context of the business of government.  "Corporation" appears seven times, but only twice in the sense of business.  One is that the King of England has authority to establish corporations but the President of the United States does not.  The other is how laws have not become perfect, including the law of corporations.

Now we have for rulers men who possess most wisdom to discern, and the most virtue to pursue, the private good of corporations.

So much for following the intent of the "Founding Fathers".

Rep. Cravaack is in touch with his constituents?

One of the charges that Chip Cravaack made in his campaign to unseat Rep. Jim Oberstar was that Oberstar was out of touch with his constituents.  I wonder if Rep. Cravaack is doing any better.

My wife received a message from MoveOn that Rep. Cravaack would hold a meeting in Duluth tomorrow, August 23, at 11:30.  I checked the Duluth News Tribune online and found no notice.  I went to Cravaack's Congressional web site and found nothing about his being in Duluth.  I called his Duluth office and was told that he would be meeting with the National Federation of Independent Business; he would be the speaker.

Using good old Google, I found that he would be at two meetings in Duluth on August 23.  I found this information on the websites of the hosts, not in the newspaper and not on his website.  There will be a "Congressional Breakfast with Rep. Chip Cravaack" at the Northland Country Club hosted by the Minnesota Society of Certified Public Accountants.  There will be a "Special Congressional Briefing in Duluth", a National Federation of Independent Businesses Member lunch meeting at Grandma's Saloon and Grill.

So what was this MoveOn message about?  When I couldn't find any notice of Cravaack meeting with constituents in Duluth, I suspected that it was about a demonstration.  I was right.  In the MoveOn message was a link to an August 2011 Recess Action, a demonstration outside Grandma's a half-hour before the start of the luncheon.  One of the complaints on the web page is that Cravaack "refuses to set up a public town hall in Duluth."

I'll let you draw your own conclusions on why Cravaack has not listed any town hall meetings in Duluth and why he has not even posted these business events on his web site.

Businesses live within their means? Really?

Over and over again, letter writers and some politicians complain that governments should live within their means just like families and businesses.  But do families and businesses really live within their means?

Consider that the current crisis was not caused by government overspending, but family and business overspending.  Many people went in way over their heads with credit card and mortgage debt.  Financial gurus created debt instruments of debt repackages over and over in a great Ponzi scheme, all in the name of free markets.  The whole mess collapsed of its own weight and took down the guilty and the innocent alike.  Unfortunately, the captains didn't go down with their ships, but were first in the lifeboats carrying their safes.

I got to thinking about what kind of corporate debt does exist.  Well, I am a small beneficiary of corporate debt; we own shares of some market-traded bond funds that give us a few hundred dollars of income every month.

Now is the time that semi-annual shareholder reports come out, and I checked one fund's holdings.  Below is a sample of some of the businesses whose bonds are held by DWS Global High Income Fund (LBF) with the rate and due date.

HCA Holdings, Inc. offers health care services in the United States. The company owns, manages, or operates hospitals, freestanding surgery centers, diagnostic and imaging centers, radiation and oncology therapy centers, rehabilitation and physical therapy centers, and various other facilities.
- From Yahoo! Finance, http://finance.yahoo.com/q/pr?s=HCA+Profile

No wonder health care costs are so high.  Many health care conglomerates can't live within their means.

Of course, these rates are low compared to credit card rates.  By comparison, home mortgage rates are around 4.50 percent for thirty years.  Treasury bonds are currently about 1.50 percent for five years and 4.25 percent for thirty years.  Either certainly beats current bank savings account rates of less than one percent.

I would say that families that have only fixed-rate mortgage debt and the federal government are living within their means far better than some large corporations.

Corporate bureaucracies eat into other corporations' profits

I've often said that government has no corner on bureaucracy.  Almost any large organization, for-profit, non-profit, government, has a large bureaucracy.  They have to in order to look into many, many details that are needed to run the organization efficiently.  You read that right, an organization needs a bureaucracy to be efficient.

Who is going to do the details of hiring and firing?  Who is going to process the payroll for thousands of employees.  Who is going to pay and collect the bills.  Certainly not the executives.  Certainly not the employees involved in developing new products. Certainly not the employees providing goods or services to customers.

The purpose of a bureaucracy is to take care of details that free other employees to do the primary work of the organization.

One corporate bureaucracy is customer support.  These are the folks that process customer questions and complaints and attempt to find solutions.  When run well, customer support provides satisfaction to the customers and feedback to the rest of the organization.  When customer support is not given organization support, it devolves into an unresponsive bureaucracy.  The result is less customer satisfaction, which in turn can lead to the demise of the organization.

A case study is the corporation many love to hate but many depend on for the functioning of their own organizations - Microsoft.

I mentioned my calendar problems in "Quote of the day - Ease of use" and "Misdirected ire".

Since then, I've been subscribing to a thread "Meetings disappearing" on Microsoft's Apple Support Discussions.  Hoo Boy!  Talk about non-responsiveness!  This thread has been going on since February and there appears to be no resolution.

Well, maybe there was some resolution.  Many report that if they set up a regular weekly appointment for a year and then change one, all subsequent appointments disappeared!  How often are regular meetings changed in your organization?  Sometimes changed meetings become the norm.  What was the solution that one writer said Microsoft proposed?  Set up 52 individual appointments for the year!!  Wow!  That certainly is a shining example of productivity improvement.  Guess what?  When the user changed one of the 52 individual appointments, the subsequent appointments disappeared.

What a way to run a railroad or any business!  I've had better responsiveness from city, state, and federal bureaucracies.

Who "destroyed" free markets?

Which of the following do you have in your area?

Independent, locally owned grocery store
Independent, locally owned drug store
Independent, locally owned stationery store
Independent, locally owned movie theater
Independent, locally owned book store
Independent, locally owned department store
Independent, locally owned daily newspaper
Independent, locally owned lumber yard
Independent, locally owned hardware store

By independent, I mean that there is only one location and that often the owner works in the store.

Grocery stores and drug stores are most likely chains, either national or state-wide.  Stationery stores are most likely national chains.  Movie theaters have been done in by technology, either television or VHS/DVDs.  Independent book stores have been done in both by large chains and technology, the latter being e-books.  Department stores multiplied with large shopping malls and then got gobbled up by large chains.  Daily newspapers have been part of large syndicates before I was even born.  Lumber yards have been replaced by three or four large chains.  And local hardware stores are dwindling.

So much for a large number of sellers, an integral part of the classical free market.

If it wasn't technology that did in a retail outlet, what or who was responsible?

How about a Republican president?  Dwight Eisenhower pushed the interstate highway system which led to urban sprawl.  City neighborhoods were decimated when people in large numbers moved to the suburbs.  Dwindling neighborhoods led to fewer customers who walked to do most of their shopping.

How about large corporations?  With their greater buying power, large corporations can easily undercut small stores on prices.  Greater buying power also gives an advertising edge to large corporations.  In Duluth, a locally owned group of drug stores went out of business this year.  Walgreen's was just too much for it.  Only about three or four owner-operated pharmacies are left.  When I was a teen-ager, I lived in a Cleveland neighborhood that had three owner-operated pharmacies.

How about development-hungry city governments?  Duluth made a big splash about getting an Office Depot to locate downtown.  Guess what, the locally-owned, downtown stationer went out of business.  Guess what again, Office Depot corporate closed the store within a year or so.

How about ourselves?  We would rather go to a big store with a big selection.  We would rather go to a chain we know than try something unknown.  I know when I travel I favor one hotel chain and too often eat at a chain restaurant.  The latter I do because too often the only restaurants around chain hotels are chains themselves.  Fortunately, I do find pleasing exceptions now and then.

Take heart, true believers in true free markets.  There are many businesses still around that are local and numerous.  There are the craftspeople - plumbers, carpenters, electricians, and so on.  Despite the proliferation of chain restaurants and coffee shops, there are quite a few local restaurants and coffee shops.  There are still plenty of local barbers and hairdressers.  Local breweries are making inroads on mega-breweries by providing better taste.  And at least in Duluth and Superior, most liquor stores are locally owned.  I'll drink to that!

Another anonymous anti-free market business

Today I received a "REQUEST FOR IMMEDIATE ACTION - TIME SENSITIVE MATERIAL ENCLOSED" piece with no more sender information than "CHEVROLET" above this phrase, postage was paid in Fort Lauderdale FL, and inside an 888 number.  Oh, maybe it is "VEHICLE PROTECTION OF AMERICA" which appears twice on the inside.

It warns me that my dealership warranty is expiring soon and offers various coverages in years and miles and a list of what is covered.  However, this company doesn't believe in a free market because it does not provide all the information that I need to make a buy decision - nowhere does it list any prices, even though it knows the make, model, and year of my vehicle and it obviously knows where I live.

In other words, they want me to call and hope that the phone representative can talk me into the coverage.

Sorry, VEHICLE PROTECTION OF AMERICA, I just threw your TIME SENSITIVE MATERIAL into the recycle box.

Three cheers for government being in the way

One of the current mantras is to get government out of the way of business.  There are many reasons that a government of the people should be in the way of business, but I'll save that for another day.

One of the ways that government should be in the way of business is with building codes.  If every builder of houses or of skyscrapers did it their own way, would you feel secure walking into any building?  Although most build sturdy, safe buildings, there are some who will cut corners to save a few bucks.  It is government that works to check up on these corner cutters.

What would have happened in Tokyo if many of the large buildings were not built to government standards?  What would the toll in lives have been if contractors had cut corners?  What would the toll have been if government inspectors hadn't checked on standards being met?

You don't need to live in earthquake zones to be concerned with building safety.  What if you put lots of money into the structural integrity of your building but your neighbor didn't.  Comes the hurricane or the tornado and his building tumbles into yours.

Many think zoning codes are anti-business, but they can be pro-business.  What if you put up a nice hotel and a junk yard is put in next door.  How much business would the junk yard deter?

Many who want zoning codes changed from residential to commercial wouldn't appreciate the same changes in their own neighborhood.  Maybe any developer who wants to change a residential neighborhood should be willing to have a similar change made in his own neighborhood.

Getting government out of the way of business is one of those notions that you should be careful what you ask for.