Economic Cause & Effect – The Chicken or The Egg?

Corporations are whining to the government for bailouts and whining to the consumers through the media to get out and shop and spend money to strengthen the economy. The reason for the entire recession, and for most, if not all recessions, depressions, and various other “downturns” or “slowdowns” or “adjustments” throughout history, is GREED. Greed is short sighted. Greed shoots itself in the foot.

It works like this:

The people with the wealth and power, namely the government, the money lenders, the manufacturing and retail industries, etc…, grow accustomed to their levels of wealth and power rather quickly, and always want MORE.

More wealth and power can be gotten fairly, though not easily, by innovation and hard work and good deeds. Providing ever better products and services wins new customers who are undecided or who support the competition, and increases the loyalty of already supportive customers. Giving back to employees improves morale and thus increases productivity. Helping the community with charity and projects increases brand awareness and provides a positive image that attracts new business from consumers and other businesses.

However, the easiest, and the far more often practiced methods of acquiring more wealth and power are decreasing wages, salaries, benefits, and number of workers, and increasing the work/jobs done by each worker and increasing prices for the consumers. In this way, you get something while giving nothing.

The problem with these selfish, greedy methods of gaining wealth and power are that they are not sustainable; they only works for a finite period.

When you lower incomes and increase costs for long enough, the consumers start to spend less, participate in boycotts, and/or are simply unable to afford goods and services.

When businesses complain and whine about things like slow Christmas sales seasons, they should keep in mind that if they had not kept laying people off and paying people less and giving people less sick time and less health care and then firing them for missing work when sick or injured, then more people would have jobs, more people would have better jobs, and more people would have more disposable income, and thus more people would be shopping and spending more money, and thus sales would be better.

Corporate America would have us believe that they lowered wages and raised prices to make up for slow sales, but how likely is it that everyone would have stopped spending money on things we want and need if we all still had the money to do so?

This blame-throwing game resembles the old riddle of “which came first, the chicken or the egg?” It doesn’t help anybody. You can’t just ask people who don’t have jobs and money to go out and shop. You have to give them jobs and pay them enough, and then they can shop.

Any company that says it can’t afford to keep it’s employees or pay them adequate wages because of slow sales should take a look at their executive’s salaries. Maybe if they trimmed some of that FAT, they could keep their workers on, and their workers could afford to shop, and the economic engine could keep turning!

Or maybe inspiring sales is just about marketing…An article on Newsweek entitled “Is The Mall Dead got me thinking. The article talks about how traditional malls are closing down around the country, and fewer new ones are being built each year. I have noticed in the Dallas / Fort Worth metroplex here in Texas that malls have had slow business and have been failing for at least a decade, but especially the last few years. I have noticed, however, that “outlet” malls, which advertise neverending sales where the prices never really seem to change but the advertising does, seem to be doing well and cropping up everywhere. So, I say, to revitalize the failing “malls”, just turn them inside out! Take the metal fire exit doors and cement walls from the back/outside of the mall, replace them with fancy glass walls and doors, put up signs that say “whatever sale” and/or “entire store up to X %” off, and the customers will flock to them!

I am a logical, open-minded, liberal, progressive, radical, green, independent individual living in the heart of Dallas/Fort Worth, Texas, amongst apparently brainwashed conservative southern Baptist Republican zombies. I'm tired of the lies of the government and their media mouthpieces and their corporate masters. I'm tired of the cheating and the stealing and the killing. I'm ready for the future. But the only way we are going to fix things is to all band together and say NO MORE! We have to start punishing the rich white collar criminals as harshly as the poor black blue-collar criminals, if not more so. And I'm tired of cults (AKA religions). They are dangerous, divisive, and delusional. We should evolve past religions towards a global humanitarian ethics. We should move away from a new world order and get back to city states with local democracy, power, food, and water.

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Posted in advertising, bailout, change, double standard, economy, employment, future, innovation, lifestyle, reform, shopping, taxes, truth, Uncategorized

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November 2008
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Mark Baland

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