Mitchell’s laws: Reduced money growth never stimulates economic growth. To survive long term, a monetarily non-sovereign government must have a positive balance of payments. Austerity breeds austerity and leads to civil disorder. Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
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A poor service experience with BrandsMartUSA and an truly horrendous service experience with Spirit Airlines (described in the comment section, below), made me think about the question of private vs. government service.

Here is what everyone knows:

1. Private industry provides better products and service than government industry, and the fundamental reason is motivation. Government agencies are uncaring about the public, and think only about quitting time, while private industry is motivated to improve and to grow by providing a lower price, a better product and better service.

2. Government workers will make you wait in line forever, then send you to another line, where you again will wait forever. Private industry workers know their job depends on their company’s success, so they try harder to please customers.

3. Private industry is hampered by government regulation, and would be more efficient if government would just get off their backs.

Everyone knows this and as is usual with “everyone knows,” everyone is wrong – or at least partly so. In fact, I believe government quite often provides better service than does business, at least big business. Here’s the reasoning behind my heretical statement:

Big business and big government each employs thousands of people, working anonymously in cubicles. For both big business and big government workers, rewards for individual performance are scarce, and few of these workers actually contact their customers. They labor silently and invisibly, mostly immunized from the realities of their product’s or service’s efficacy. They just do their jobs and keep their heads down.

From nearly all standpoints, business workers and government workers are the same people. They work. They don’t want to be criticized. They know they have very little to do with their organization’s success or failure. They recognize they are but minuscule, easily replaced cogs in giant machines.

I can see but one major difference between government agencies and private companies: Their leaders’ motivations. The leaders of government agencies follow the bidding of Congress. They don’t focus on invention, creation or competition. They focus on execution and staying out of trouble. They want to do a good, safe job while avoiding criticism and complaints from the public or from Congress.

The leaders of big business are motivated by sales, growth and profits. Customer complaints are tolerated up to the point where there is an impact on dollar inflow. They do focus on invention, creation and competition, the goal being to grow bigger, stronger and especially, richer.

Classic big private companies are banks, oil companies, car manufacturers, pharmaceutical firms, insurance companies and chemical companies. Classic big government agencies are Medicare, Medicaid, Social Security and the Pentagon.

Though big companies like to boast about their customer service, and how much they care for the ecology and their product quality, in reality they tend to do only what they must, either for competitive reasons or government regulation.

Imagine where the oil companies would drill if not for federal regulation. Or how even more dishonest the banks would be. Or how little attention to safety and gas mileage the car companies would pay. Or what poisons the pharmaceutical companies would sell. Or the toxins the chemical companies would spread. Imagine how poorly the airlines would treat you, left to their own devices. Things are bad enough with federal oversight; imagine without.

By contrast, federal agencies are self supervised. The good they do is not the incidental result of a drive for profits, but rather because that is their fundamental assignment.

My impression is that Medicare is more honest and helpful than most insurance companies; Social Security is more honest and helpful than most retirement funds. Back in the days when airline rates were regulated, service was far better than it is today. And deregulation of the banks has proved to be a disaster.

I suspect the American public would be better served by Medicare, rather than private insurers, for everyone – better served by federally owned banks than by private banks – better served by airline fare regulation and better served by federal universities than by private universities.

The point of this fact-deficient diatribe is that big government is necessary to control big business, and often provides better service, because it is not profit-constrained. Those who see big government as an Orwellian “big brother” weighing down our freedoms, are missing the big picture. The Tea Party reminds me of teenagers who tell their parents to “Get off my back,” until something goes wrong and they come running back to mommy, crying “Save me; save me.”

Rather than marching against all government involvement, and crying “socialism” every time someone suggests a government initiative, we should search for the points where we can benefit from the creative energy of capitalism together with the controls of government action and oversight.

And now that I’ve had my say, you may wish to read about Spirit Airlines in the first comment.

Rodger Malcolm Mitchell
http://www.rodgermitchell.com


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No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia. The key equation in economics: Federal Deficits – Net Imports = Net Private Savings

MONETARY SOVEREIGNTY