Part 2. Click for part 1.
Now would be a good time to ask me where is the fix? All I’ve been talking about so far is why we are in the mess we are in
From the entrepreneurial perspective – we have ineffective management. It’s everywhere. Not only the government suffers from this – major companies are settling for ridiculous levels of idiocy in their decisions. Probably because that’s what pays the most – immediately. In the long run, however, it’s not all that bright and shiny.
The big three automakers can’t get it into their system that people buy American trucks simply because people need them and there’s little to no alternative to them. And people buy Japanese cars because people want them – for higher efficiency and reliability for the same (if not lower) price . Out of the curiosity and nostalgia I always rent a different American car when I cannot travel in my own car. So far the experience is next to horrible. These cars have less sex appeal than President Bush and are less comfortable than a torture chair. I’ve been through Pontiacs, Fords, Chryslers and Chevrolets, varying among cars, SUVs, vans and trucks.
The outsourcing of high-tech jobs, R&D and pretty much anything where you have to use your brains damages the overall state of economy. I closely work with people who either manage outsourced teams or do clean ups after outsourcing’s epic failures. For every story about successfully outsourced project I hear two about failed ones. From the short-range-profit point of view the outsourcing is great, but when you take longer terms into consideration – outsourcing is less effective and costs just as much if not more. There’s a reason why business owners prefer working with people locally, and that is – easiness of communication, staying in touch and fast resolution of issues, which in the long run costs less than just cheap execution. Talking to someone, who’s English is a second or third language and who’s only incentive is to work for as long as they can so they can suck all the money they can will hardly yield anything useful. Besides, this is just handing our own competitive advantage to our competitors on the silver plate with a golden rim. And we are even paying for that!
So all that we need to do is create more jobs in the country. More people in the country will make money (and more people will be making more money than they are now), so the blood of the economy will start circulating again. This is not a short term solution, nor it would benefit all people at once overnight. But it’s surely a way to go.
If lawmakers, instead of passing a bailout (which reminds me of the old saying that you can’t heal a dead with a poultice) should concentrate more on having a law that will reward (with tax breaks maybe?) companies that create and maintain jobs in USA and punish those that dump them overseas. From my perspective – it’s a matter of language of the law how it’s done, as long as it’s done.