This quote fits well with my previous post.
"I predict future happiness for Americans if they can prevent the government from wasting the labors of the people under the pretense of taking care of them." - Thomas Jefferson
1 month ago
Wednesday, July 21, 2010
Disconnect
I don’t know about anyone else who reads this blog, but I have begun to notice a major disconnect between where our government has been heading (and yes that includes the last decade, not just the current Administration), and where our businesses (both small and large) are heading. I think that the difference is explained a little in the below snippet from Riverfront (emphasis added is mine):
“Mired in debt, dysfunctional government, and poor demographics, the developed world’s growth prospects are dimming and, if not careful, it risks slipping into irrelevance. Led by Japan, which began exhibiting signs of malaise two decades ago, we think the developed world’s vitality is being surpassed by younger, more numerous, and increasingly productive and competitive emerging market upstarts. We view this as a natural progression, but one that does not necessarily have to come at the expense of economic growth in the developed world. In our view, maintaining dynamism in the developed world will require gradually reducing the size of long-term government spending, growing wages through higher productivity, and maintaining leading edges in technology, innovation, marketing and finance. With these competitive advantages, rising wealth in emerging markets can create new customers as well as new competitors. While easier said than done, we believe successful implementation of these measures will characterize those developed world countries able to maintain economic growth and relevance. The alternatives – ignoring the changing world, failing to tackle structural spending issues, falling behind in technology, closing off trade and becoming protectionist – are a recipe for economic decline, in our opinion.”
I think our businesses exhibit the very ideas that Riverfront states are necessary in order to maintain relevance – and I 100% agree with their list. However, our government seems to be mired on the failing side, and in a way they are trying to vilify our businesses for going the right way. Government is getting bigger and less sophisticated. Creating a blog for every new project and government creation is not advancing technologically, in case there was any argument there. Adding committees and people to the payroll who will work on figuring out how the rest of the government can be more productive will not increase productivity. They are constantly threatening protectionist policies, and they seem to be establishing a brand – through our “silent” marketing – that is not attractive to businesses.
In fact, our “marketing” has shown businesses that our government wants an environment where rules will change at the whim of legislators. Some companies will get preferential treatment, but only for as long as congress decides (I wonder how that decision is made….billions in lobbying…perhaps?, with the occasional peer pressure cave-in?) Taxes will constantly be increased to fund the lazy and unproductive, with a dollop of help for the actual needy. And any time problems arise the "other" party will be to blame.
So, what will it take?
“The OECD concludes: ‘Rather than see the ‘rise of the rest’ in terms of the ‘decline of the west’, policy makers should recognize that the net gains from increased prosperity in the developing world can benefit both rich and poor countries alike. Improvements in the range and quality of exports, greater technological dynamism, better prospects for doing business, a larger consumption base – all these factors can create substantial welfare benefits for the whole world.”
Put simply…Get out of the way and encourage businesses to keep going the right way! If our government doesn't do this then eventually we will fall from the top.
“Mired in debt, dysfunctional government, and poor demographics, the developed world’s growth prospects are dimming and, if not careful, it risks slipping into irrelevance. Led by Japan, which began exhibiting signs of malaise two decades ago, we think the developed world’s vitality is being surpassed by younger, more numerous, and increasingly productive and competitive emerging market upstarts. We view this as a natural progression, but one that does not necessarily have to come at the expense of economic growth in the developed world. In our view, maintaining dynamism in the developed world will require gradually reducing the size of long-term government spending, growing wages through higher productivity, and maintaining leading edges in technology, innovation, marketing and finance. With these competitive advantages, rising wealth in emerging markets can create new customers as well as new competitors. While easier said than done, we believe successful implementation of these measures will characterize those developed world countries able to maintain economic growth and relevance. The alternatives – ignoring the changing world, failing to tackle structural spending issues, falling behind in technology, closing off trade and becoming protectionist – are a recipe for economic decline, in our opinion.”
I think our businesses exhibit the very ideas that Riverfront states are necessary in order to maintain relevance – and I 100% agree with their list. However, our government seems to be mired on the failing side, and in a way they are trying to vilify our businesses for going the right way. Government is getting bigger and less sophisticated. Creating a blog for every new project and government creation is not advancing technologically, in case there was any argument there. Adding committees and people to the payroll who will work on figuring out how the rest of the government can be more productive will not increase productivity. They are constantly threatening protectionist policies, and they seem to be establishing a brand – through our “silent” marketing – that is not attractive to businesses.
In fact, our “marketing” has shown businesses that our government wants an environment where rules will change at the whim of legislators. Some companies will get preferential treatment, but only for as long as congress decides (I wonder how that decision is made….billions in lobbying…perhaps?, with the occasional peer pressure cave-in?) Taxes will constantly be increased to fund the lazy and unproductive, with a dollop of help for the actual needy. And any time problems arise the "other" party will be to blame.
So, what will it take?
“The OECD concludes: ‘Rather than see the ‘rise of the rest’ in terms of the ‘decline of the west’, policy makers should recognize that the net gains from increased prosperity in the developing world can benefit both rich and poor countries alike. Improvements in the range and quality of exports, greater technological dynamism, better prospects for doing business, a larger consumption base – all these factors can create substantial welfare benefits for the whole world.”
Put simply…Get out of the way and encourage businesses to keep going the right way! If our government doesn't do this then eventually we will fall from the top.
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