We all know that friction is the enemy of any machine, that's why you lube your car, why shoes that are polished regularly scuff far less than those that are not, or the reason why waxing the floors in your home makes them last far longer; in every case, you are defeating friction. When I was growing up, every child knew a properly greased and oiled bike pedaled easier, went faster, and would glide further, we also understood that if the brakes weren't properly set up the results could hurt - a lot. Properly controlling friction in everything around you improves efficiency and can dramatically improve function and dependability.
BUSINESSES ARE NO EXCEPTION! AIG, CITIBANK, GM, Big Media, the Health Insurance Industry and almost all of the other giants are like the man who is so fat he cannot see his toes, much less put on his sox or even prepare his own food. In every case, they have increased their nonproductive internal overheads (friction) to a level where they cannot function as designed and without external support they will die. Perhaps they should - or at least go on a serious program and exercise.
In business friction can be defined as needless layers of bureaucracy, fiefdoms where people create work to justify jobs which are no longer meaningful to the organization, bureaucrats who insist on spending their entire budget in order to support an increase for the next fiscal year, not to mention ridiculous levels of executive compensation.
Friction does absolutely nothing but transform motion into heat while wearing away it's host. Sometimes it is good, like the breaks in your car, and sometimes it is bad like what happens when you forget to put oil in the engine. In the best case, friction is put to use, like starting a fire by rubbing two pieces of wood together, or the experimental automotive brakes which recapture the energy of your moving car through a braking system which generates and stores electricity for later use.
When big banks need to charge interest and fees that far exceed what Credit Unions and smaller banks charge, while still loosing money, it is a clear indicator of excessive friction draining the system.
When the brilliant economic minds who dreamed up the sub-prime loans and derivatives Ponzi scheme which brought down AIG could not predict it's inevitable failure, it is a clear indicator of excessive friction draining the system. Some might call it unbridled greed and outright theft.
When a Health Care system that was the standard of quality and cost effectiveness to world has become unaffordable and dysfunctional while the heads of HMO's have become Billionaires, it is a clear indicator of excessive friction draining the system.
When major newspapers are failing on a daily basis while their parent corporations have earnings in excess of 20%, it is a clear indicator of excessive friction draining the system.
When corporate executives earn more than the company nets, it is a clear indicator of excessive friction draining the system.
When anyone in top management receives total compensation in excess of 10 time that of the average non management employee, it is a clear indicator of excessive friction draining the system.
Placing "shareholder value" ahead of corporate health is just like putting sand in the gears.
Friction is not an entirely bad thing, the brakes in your car offer a great analogy. Well thought out corporate regulation keeps companies from going into corners too fast; preventing disasters rather requiring costly repairs or even corporate deaths.
It is time that we remove the non productive friction and re-create a system where the company president meets each and every employee at the yearly picnic or Christmas party, where unproductive layers of bureaucracy are identified & eliminated, where executives are compensated based upon their actual day to day and long term value to the company, where corporate goals are long term orientated - not manipulating share prices by pandering to stock speculators.
Remove the counter productive friction.
Real solutions for a financial recovery which do not cost a single tax dollar.
This is a summary of our initial post, For the full content please see the same title in the March 2009 archives. Please click this link, the full article will appear at the bottom of this page!
It's simple, much if not all of what ails us economically can be solved without costing one thin dime, that is what we mean by a ZERO COST RECOVERY.
Many of today's ills have come from easily reversible causes, here are a few to start you thinking:
- The Bible condemns usury (sort of); whether or not you are religious, this make great sense.
- "A Free & Independent Press is the Cornerstone of Democracy". I don't know who first said it, but they were spot on. Today's media does not hold the rich and powerful accountable, it is owned by them; they are at the core of the problem.
- Food costs have more than doubled, yet the family farmer is struggling while large corporate farmers are getting huge subsidies. One solution would be enacting anti-trust legislation that forbids the huge conglomerates which are so dominant in critical industries from operating at more than one level in the manufacturing and distribution chain.... Grow it, process it, distribute it or retail it - choose one!
- The price of oil at the well head is dramatically different from the price we see quoted on the TV each night. The difference is created by speculators in the commodities markets (the same holds true for food and other vital commodities). Force the CFTC to re-institute the commodities speculation guideline that were in place prior to 1990.
- Big Pharma spends far more on marketing and lobbyists than on R&D, some say the figure is twice as much. How much do you think this adds to what your prescriptions cost? Lobby our legislators to allow Medicare to negotiate drug costs with their manufacturers and watch prices fall to the levels enjoyed in most other countries.
- Health care costs are skyrocketing yet Physicians pay has decreased dramatically. How much do you think the near monopolies in Health Insurance and HMO's contribute to this?
It's simple, much if not all of what ails us economically can be solved without costing one thin dime, that is what we mean by a ZERO COST RECOVERY.
Many of today's ills have come from easily reversible causes, here are a few to start you thinking:
- The Bible condemns usury (sort of); whether or not you are religious, this make great sense.
- Big Banks don't work for America or Americans (or anyone else for that matter). Consolidation was touted as a way to lower costs, provide better service and more affordable fees to customers. Can anyone show me an example where these promised economies of scale came to life? How about the lower fees and better service?
- Bigger is not better, that is why anti-trust legislation was enacted. Today's financial crisis was brought to a head by the unvarnished greed of the giant banks, financial institutions and corporations with the complicity of the majority of our legislators, it is just that simple.
- The "Free market" is not the cause of this problem, the fact that it has been castrated, prostituted and redefined by the greedy is. "Free market" does not mean a market without rules, or domination by the richest and most powerful. Without meaningful competition, free markets cannot, and do not, exist - period.
Rollback, update and aggressively enforce meaningful anti-trust & financial sector regulations and the root cause will be eliminated. How about requiring a binding contract guaranteeing that all consumer beneficial promises be a part of all mergers and acquisitions? To be effective, it should include an onerous non compliance clause!
- "A Free & Independent Press is the Cornerstone of Democracy". I don't know who first said it, but they were spot on. Today's media does not hold the rich and powerful accountable, it is owned by them; they are at the core of the problem.
- Food costs have more than doubled, yet the family farmer is struggling while large corporate farmers are getting huge subsidies. One solution would be enacting anti-trust legislation that forbids the huge conglomerates which are so dominant in critical industries from operating at more than one level in the manufacturing and distribution chain.... Grow it, process it, distribute it or retail it - choose one!
- The price of oil at the well head is dramatically different from the price we see quoted on the TV each night. The difference is created by speculators in the commodities markets (the same holds true for food and other vital commodities). Force the CFTC to re-institute the commodities speculation guideline that were in place prior to 1990.
- Big Pharma spends far more on marketing and lobbyists than on R&D, some say the figure is twice as much. How much do you think this adds to what your prescriptions cost? Lobby our legislators to allow Medicare to negotiate drug costs with their manufacturers and watch prices fall to the levels enjoyed in most other countries.
- Health care costs are skyrocketing yet Physicians pay has decreased dramatically. How much do you think the near monopolies in Health Insurance and HMO's contribute to this?
-Corporations are NOT People. Our Founding Fathers did not think so when they formed our nation, why are we allowing it now?
Monopolies and oligopolies are the root causes of our problems. Cure these ills, and our financial woes will evaporate WITHOUT COSTING ONE DIME.
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