Tuesday, June 30, 2009

Et tu, Big Business?

The truth only hurts if it ought to:

"...capitalism’s murder is at the hands of its most successful child: big business.

Everywhere we look we see the great and once-great beneficiaries of free markets running to the state for protection from the cruel bullying of competition."

Jonah Goldberg, "Et tu, Big Business?" National Review Online

Saturday, June 27, 2009

Your Money, Our Schedule

Reason.tv is a smart look at our world through the lens of free minds and free markets. It's consistently interesting, thought-provoking, and often funny, as you will see in this one-minute video on what health care might be like, once the government's in charge.

Friday, June 26, 2009

"It's All About the O"

The CEO of Overstock.com, a self-proclaimed libertarian, defends school choice and short-sellers, attacks bad regulations and naked short-sellers, and says "the government should pave the roads, run the Post Office, and stay off my porch."

Thursday, June 25, 2009

Shop Class as Soulcraft

Every kind of human labor can be an expression of human genius. We are surrounded by the evidence of human genius everyday. We just don't recognize it because it is not our genius.

The Colbert ReportMon - Thurs 11:30pm / 10:30c
Matthew Crawford
Colbert Report Full EpisodesPolitical HumorStephen Colbert in Iraq

Wednesday, June 24, 2009

A Governor Every Day

As the whole world knows by now, the governor of South Carolina went on a four day hike and did not announce where he was going.

Listening to the media reaction, you would have thought that a pilot had bailed out of a passenger plane in mid-air. Peculiar. Irresponsible. Unprofessional. And these were the words his allies used.

Yet, who really needs a governor every day? David Henderson, Associate Professor of Economics at the Graduate School of Business and Public Policy, Naval Postgraduate School, makes a good point when he writes, "many people think that without a governor in charge, our lives would be in chaos. But ask yourself. How often through the day or even through the year do you consult the governor before taking action? You could argue that without the governor around, certain big spending or regulatory decisions would not be made. And that's necessarily bad?"

Henderson concludes, "The thinking behind the headlines is the same as the thinking behind the claim that a governor runs a state or a president runs the country. Fortunately, they don't. The headlines would be hilarious if not for the seriously distorted understanding of the world that it demonstrates."

Tuesday, June 23, 2009

Promoting Prosperity

"Our next speaker will be Jo Kwong of the Atlas Economic Research Foundation. Her topic will be:

"Promoting Prosperity Around the World – Is There a Recipe for Success?"

Date: Wednesday, June 24
Time: 5 pm reception, 6 pm speaker
Location: Imaging Arts Gallery, 175 King Street, Charleston, SC

Why are some nations rich, while others seem trapped forever in poverty? Many authors and great thinkers have tackled this subject, offering a fascinating variety of explanations. One small non-profit organization called the Atlas Economic Research Foundation believes it has something to contribute to this debate.

Atlas believes that economic freedom sows the seeds for prosperity. When people are free to develop and act on innovative ideas, entrepreneurship develops and wealth is created. Institutions that unleash human action, creativity, and ingenuity offer the best hope to lead millions out of poverty. Join us to hear how Atlas is actively working to promote economic freedom around the world, and why it sees this freedom as vital to human flourishing. Unless you travel the globe regularly, you are likely to leave feeling grateful for the many freedoms Americans take for granted on a daily basis. Come hear how people are working in countries around the world to fight for the freedom to work, produce, consume and invest the fruits of their labor.

Jo Kwong is the Vice President of Institute Relations at the Atlas Economic Research Foundation in Washington, DC.

Monday, June 22, 2009

Not the Enemy

Big business rarely gets a favorable review. But it does happen.

Earlier this year, writer Charles Platt went undercover to get the real story on what it is like to work at Wal-Mart. Rather than a soulless corporation and exploited co-workers, he found an environment like a Silicon Valley start-up: "There was the same gung-ho spirit, same lack of dogma, same lax dress code, same informality - and same interest in owning a piece of the company. All of my coworkers accepted the offer to buy Wal-Mart stock by setting aside $2 of every paycheck."

Platt says, "I reached a conclusion which is utterly opposed to almost everything ever written about Wal-Mart. I came to regard it as one of the all-time enlightened American employers, right up there with IBM in the 1960s. Wal-Mart is not the enemy. It's the best friend we could ask for."

Read the whole story here, in the New York Post.

Sunday, June 21, 2009

The Quotable Bastiat

"All men's impulses, when motivated by legitimate self-interest, fall into a harmonious social pattern."

Economic Harmonies, 1850

Saturday, June 20, 2009

Green Yachts

Being Green once meant being something like a Hippie, a rebel against the machine and the lust for money, a person in search of an authentic experience in an uncorrupted world.

It certainly did not mean you owned a yacht. How times have changed!

Now Green has become a ubiquitous marketing term for everything Good. Everything can be Green, from fruit to jobs. Even big, expensive boats. No less an authority than Yachting magazine has an article advising recreational yacht owners on steps they can take to make their boats environmentally friendly.

This in the same issue where they advertise the eight best watches for yachtsmen. Average price: $11,941.

What does all this Green Goodness mean for the future of being Green? Perhaps the term is on its way to death by overuse. If everyone and everything is Green, what's left to feel smug about?

Another possibility is that an earnest discussion of how to go Green in a yachting magazine is a sign of the success of the environmental movement. It has reached an important target market. If it can convince the kind of people who own luxury yachts and buy $11,000 watches that they are part of something Green and Good, it will have a much easier time getting them to make contributions.

It's like telling a successful businessman that his success is a sign of election by God, then asking if he'd like to return God's favor.

One final possibility: the Green movement has gone mainstream. So mainstream, in fact, that people want to be Green, so long as it does not mean a major disruption in the way they live. Thus Green yachts.

What's next? Green jets?

Friday, June 19, 2009

A Socialist Model City

Only the New York Times could travel to the former GDR (East Germany) and nostalgically recall a "socialist model city."

Nostalgia for the past -- especially childhood -- is normal. But the past of East Germany is anything but normal. Its long nightmare of secret police, shoddy consumer products, and mind-numbing bureaucracy should have overwhelmed this kind of uncritical navel-gazing.

For history without rose-colored glasses, check out the BBC report "Inside the Stasi's Dungeons." The BBC reminds us that, "The GDR imposed its will through the feared secret police, the Stasi, with dissidents being imprisoned and tortured for such "crimes" as trying to leave the country, or telling political jokes."

Thursday, June 18, 2009

Business and the Box, Continued

More Business and the Box...

MBA: "Master in Box Administration"

Ph.D. in Business: "I've never actually made one, but I've read a lot about boxes."

B2B: "Box to box."

A blindly loyal junior corporate executive: "Box boy."

Wednesday, June 17, 2009


From Vanity Fair via the New York Times...

"As Washington fails to practice the fiscal discipline it has long preached to the world, the current crisis will prompt rising economies to reject free-market democracy — a toxic legacy, a Nobel laureate warns."

“Old-style Communism won’t be back, but a variety of forms of excessive market intervention will return. And these will fail."

Monday, June 15, 2009

Class Warfare Tax Policy

From the Center for Freedom and Prosperity, five good reasons higher taxes on the rich aren't a good idea:

1. High tax rates reduce incentives for productive behavior.
2. High tax rates won't raise much revenue.
3. High tax rates don't help the poor.
4. High tax rates reduce competitiveness.
5. High tax rates on the rich lead to high tax rates on everyone.

Saturday, June 13, 2009

Business and the Box

The vocabulary of business is laced with cliches. Here are a few, broken down by occupation:

CEO: "Think outside the box."

Entrepreneur: "Born outside the box."

Bureaucrat: "Shut up and get into the box."

Diversity Consultant: "Isn't it wonderful that we have so many different kinds of people in our box?"

Legal Department: "It's safer in the box."

Chief Financial Officer: "This box doesn't balance."

Logistics Department: "Has anyone seen our box?"

Competitor Analysis: "Check out that other box."

Leadership Consultant: "Come on, let's all get in the box!"

Negotiation Consultant: "My box is better than yours."

Chamber of Commerce: "All our boxes are beautiful."

Human Resources: "What are you doing in the box?"

IT: "We're gonna need a bigger box."

Business Ethics Consultant: "We all should decide on what to do with the box."

Environmentalist: "Boxes are murder."

Gay Activist: "Come out of the closet and into the box!"

Angry Feminist: "Smash the ceiling in the box!"

Marxist: "Smash the box!"

Union: "Screw the box."

Economic Development Consultant: "We need more jobs in the box."

Politician: "How many votes are in the box?"

Wednesday, June 10, 2009

Rast's Law

I propose, and have rather immodestly named, a new law of business. I call it Rast's Law. It states, "Every successful corporation, if it lasts long enough, eventually turns into the Department of Motor Vehicles."

This insight occurred to me while reading an essay by Robert Jackdall on how bureaucracy shapes the morality of the people who work in it.

Many of the moral dilemmas discussed in business ethics texts are not drawn from small, entrepreneurial business organizations; they are drawn from large, bureaucratic business organizations, almost always publicly traded corporations and often government contractors. Why?

Because big bureaucratic organizations are precisely where great ethical dilemmas occur, where the temptation to serve oneself is greater than the reward 0f serving others. This is true whether the bureaucracy in question is a publicly traded corporation, a university department, or a government agency.

Consider the following business life cycle. An entrepreneur creates a new idea or tries a new way to deal with old problems. He is motivated by his reward for serving others. If he is successful, he will attract those professionals who are skilled at institutionalizing successful ideas, i.e. managers. Managers give the idea an efficient, orderly, and useful life by building a bureaucracy around it.

But ultimately, bureaucracy is the free radical of a successful organization. The larger the bureaucracy, the greater the chance that managers will use the organization for their own purposes, not necessarily consistent with the goal of the original entrepreneur or the organization itself.

Bureaucracy appears as a benefit; it finishes as a liability. The amount of time between the two depends on many things, but the path seems sure. Without the spirit of the entrepreneur to disrupt the organizational status quo, even successful organizational bureaucracies are destined to evolve into something that looks and acts like the DMV.

Sunday, June 7, 2009

"Honey, I've Changed...Really!"

GM has announced that it is working hard, seven days a week to build, not cars, but a brand new marketing plan.

What they've come up with sounds like a sorry husband trying to talk his way back into a locked house.

"I've changed."

"I'm sorry."

"I am so humiliated."

"Have pity on me, please."

"I'm the underdog here."

Is GM missing the point again? The Japanese car companies did not beat GM in the marketing department. They beat GM on the factory floor.

Saturday, June 6, 2009

The Most Ridiculous Faith

After discussing Bastiat, Lew Rockwell wraps up a column about the economy with a conclusion worthy of the great man himself:

"We are a generation that proudly shows off its accomplishments in all areas of science, and we preen about our love of facts and our detachment from mythology. Yet our culture is imbued with the most ridiculous faith in government to turn stones into bread, to accomplish miracles with a printing press before our very eyes."

Read the whole thing here.

Friday, June 5, 2009

Free Money!

Thursday, June 4, 2009

The U.A.W. Flexes Its Protectionist Muscle

Flush with his victory over the American taxpayer and GM bondholders, Ron Gettelfinger of the United Auto Workers makes it clear that he is going to use his growing political might to fight free trade.

A few of his telling comments:

“If they’re going to sell them here, they should build them here … Why wouldn’t they build them here as apposed to transporting them from the Far East?"

"This country needs an industrial policy."

“General Motors is on that road and we intend to make sure they stay down that path."

View the entire interview here:

The Wall Street Journal calls Gettelfinger's position what it really is, "raw trade protectionism."

Wednesday, June 3, 2009

Small, Not Smart Cars

How they made small cars people wanted to drive -- or rather, had to drive in East Germany.

Tuesday, June 2, 2009

An Emergency Psychology

Here's another lesson of history we should consider in our present crisis.

How did a small number of Southern slave owners convince a larger population of non-slave owners to go along with the act of secession that started the American Civil War?

One historian concluded that "the secessionists succeeded less because of the intrinsic popularity of their program than because of the extreme skill with which they utilized an emergency psychology."

In other words, beware ambitious men who speak of emergencies as "an opportunity to do things that you think you could not do before."

Monday, June 1, 2009

The Burden of Freedom

We often hear that our government must do something to protect people who have been injured by the brutal world of free market competition, especially the poor.

What we don't know is that this argument has been used before, to justify the ultimate social safety net. We called it slavery.

In 1854, the antebellum slavery apologist George Fitzhugh published Sociology of the South or The Failure of Free Society.

Fitzhugh argued slavery was preferable to free society, especially for the poor. He wrote, "The dissociation of labor and disintegration of society, which liberty and free competition occasion, is especially injurious to the poorer class; for besides the labor necessary to support the family, the poor man is burdened with the care of finding a home, and procuring employment, and attending to all domestic wants and concerns. Slavery relieves our slaves of these cares altogether, and slavery is a form, and the very best form, of socialism."

When does freedom become a burden? When does relief become slavery?