Tuesday, March 26, 2013

Bigger may not be better

There is a series of commercials being run by a communications company that capitalizes on the belief that faster is better, bigger is better, doing more than one thing at a time is better.  These commercials feature a man sitting at a school table with 4 or 5 young children, perhaps 5 or 6 years old.  In each case, the man asks a question of the kids and they respond.

My perception is that most people have a similar reaction to these commercials as I did; cute.  Out of the mouths of babes, kind of truths.  The old proverb, you learned everything you needed for life in kindergarten.  I guess it plays on our belief that there are simple answers to the complicated aspects of life.  Chances are, most people do not think anything more of these ads.  Perhaps that is the issue that needs to be addressed; why don't we think beyond the obvious, but that is grist for another blog.

My focus here is the belief that bigger is better.  There is ample evidence that the forces behind the tea party phenomenon and the concept that drives the attacks on the size and influence of the federal government have life because of the belief that bigger is not better.  That we need a smaller federal government, a decreasing influence by the government over our lives.  I understand this viewpoint when it comes to all of us being more self-reliant, and less dependent on our government for food and shelter.  What can we do for ourselves should be our first thought as opposed to what can I get from someone else, especially Uncle Sam.  Safety nets used as a bridge between jobs, or to attain medical services when need outstrips resources, or to improve the daily lives of children whose only crime was to be born in the wrong economic circumstances, should be just that, safety nets, not a way of life.  Scamming as a way to earn one's living, whether the victim be an elderly neighbor or uneducated immigrant or government agency is wrong.   My problem with less government is that some forces behind this push are doing so, not because they believe what I have detailed above, but because they seek a free hand to conduct their business in any fashion they feel will deliver the biggest profit.  Regulations that keep them from polluting our air and water as a matter of convenience become the target but always cached in the all American axiom that what is good for business, helps America.

What seems odd about the bigger is not better when it comes to government crowd, is that they don't seem to apply that same patriotic fervor in the area of business? 

When one huge corporation merges with another, generally speaking the stock of both companies goes up.  The business perspective says that duplications of effort, whether in the area of accounting or transportation or sales, will be eliminated, thereby reducing costs, thereby increasing profits.  In other words, jobs eliminated means a stronger bottom line.  Is this good for America?

If a town changes from one with dozens of small businesses on main street to one with a Walmart superstore, does that improve the community? Do the previous store owners now work at Walmart for lower pay, less benefits, and less job satisfaction?  Is bigger better merely because prices are lower? 
Is the tenet, what is good for business, good for America true, if the business employs low wage labor selling imported products made by even lower wage labor?  Of if that same business demands low margin pricing from its vendors regardless of the fact that those vendors must now reduce cost, frequently labor costs of its own employees, to provide that price?

And what do we do when those same big businesses, those that promote less government in the form of less regulation yet also demand special tax breaks for moving their company into a state or community in exchange for the promise of jobs?  Does this not place the concept of competition in the free enterprise system on its ear if they are rigging the contest by having tax advantages that their smaller competitors do not?  And, if they can make a corporate decision to limits hours to less than 30 to reduce the cost of benefits, does this not improve their bottom line by passing the burden of their employees medical insurance needs to both their employees and the government agencies which will need to supplement those costs?   How much does the success of a company like Walmart cost the American economy in government assistance for its employees, and suppressed wages for its employees and those of its vendors?

The truly sad part is that it is precisely the consumer's shopping choices to spend their limited dollars at these big box stores that enhance the cycle of degrading middle class salaries. More small business lose out, more people have less money to spend since they must take lower wage jobs, more vendors must keep their labor costs down to afford the privilege of selling their products to these big box stores, allowing those huge corporations to keep their prices low thereby attracting the consumers who don't have much choice but to buy the least expensive products available.

Which then brings me to bigger wages.  Why is it OK for wages at the top of the scale to have continued to rise while those in the middle and below have barely stayed even with inflation? Why do CEO's make hundreds of times the salary of their employees now where they made only 20, 30, 40 times a mere 30 years ago? And, does that trend make America better or worse?  Bigger companies need smarter CEO's and more intelligent decisions to navigate such huge corporations in today's economy.  I understand that, but if the cost is to suppress the salaries of everyday Americans, then is the country better for having to require to pay for such geniuses, hence to have such huge corporations?

I am willing to listen to those who claim that big government is an issue that needs to be addressed as long as they do not use that same big government to gain competitive advantages in the market place, or want to gut environmental regulations that keep America from looking like a 3rd world country with polluted rivers and skies, and as long as they are willing to apply the bigger is not always better philosophy to the business community as well.

No comments:

Post a Comment