Understanding our economic problems

What are our economic problems?

The first step to addressing a problem is to make sure we define what the problem is and get at the root causes.

Jobs, out sourcing, multinational corporations, unions, governmental rule and regulations, taxes, non secured borders, foreign governments manipulating their currency, buying market share etc. These are all legitimate aspects of the economic problems we face.

The philosophical chasm between the collectivists and the belief in the individual.

Drill baby drill, develop our carbon based energy or try to force conversion to unproved, very expensive “renewables”.

In my opinion the root causes of our problems are that:

  1. We have not adjusted to the fact that we are in a different world and that globally countries and labor markets are competing for jobs, our factories and our technologies.
  2. The media and the collectivists have brainwashed us into believing it is bad and evil to compete and to be successful.
  3. The green movement has been successful in influencing our laws to make us non competitive.

The rest of this posting will address the first topic, our lack of adjustment to Globalization.

I teach a number of management courses and one of them  involves the application of TQM, Total Quality Management. In defining what is quality it states that quality is meeting and exceeding the expectations of your customer. So a customer has their own idea of what they expect in terms of product or services and if these are met or exceeded they feel that they have been provided with a quality product or service.

Now because of globalization US companies are involved in a different world then they were involved in in 1960. They face competition from foreign companies, the face competition from US companies who have found that they can be more successful by building plants overseas or by outsourcing work to organizations located in foreign countries.

Nothing new here, we all know this.

But now lets look at this in a different way. Every company must make a profit to survive, every company when faced with building a new plant must go through a honest evaluation in whether to locate their plant locally, out of state, out of country or on the moon.

So now if labor wishes to have the plant located locally they must now for the first time recognize the corporation as their “CUSTOMER”. Yes the corporation is the customer for local labor and they must compete. Do they compete by sticking to the old ways of doing business? By suffocating work rules, by non cooperative attitude? By opposing process improvements every step of the way? By using their political muscle to create an atmosphere which is anti-business. Corporations are not the enemy of Labor, but are now the customer of Labor.

The worker is not represented by their presently constituted  labor unions.We need a paradigm shift here and we need it fast and badly.

Local and state government do not realize that the corporations are their customers when it comes to locating their facilities. They are in competition globally. If you were a corporation and had to build a new plant to produce a new product and time to market was critical what would you be looking for from the governments of the candidate locations.

When regulations and taxes are much more burdensome than those found in foreign or out of state lacations, and when there is an attitude of soaking the big bad evil corporation, the big bad evil corporation will just leave becasue they are not being treated like a customer and their needs and expectations are not being fulfilled or met adequately.

When I say we have not adjusted to globalization what I am getting at is that with globalization companies have choices that they did not have in the 1960s and every decade we see them leave and leave and leave and yet our Labor leaders and our government still treats them as they did in the 1960s instead of realizing that the corporations must be treated like the important customers/consumers that they are when it comes to labor and plant placement.


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