What About the Economy?

Personally I think that economic recessions, including the current one, are a good thing. Recessions help to weed out the crappy companies that aren’t creating and delivering value people want. Many of those companies were doing a good job at one time, but they failed to keep pace. As our values change, our companies need to adapt. Companies that can’t do that deserve to die off, and the jobs they created should be eliminated. They’ll eventually be replaced by new companies that have a better sense of people’s current needs and desires. Company that just don’t “get it” will be replaced by companies that do.

Consider the notion of bailing out the failing U.S. auto companies by having the taxpayers fund them. Is this a good idea? It’s okay except for one small problem — it’s STUPID! It’s one of the dumbest things our political reps could possibly do with our tax dollars. An auto company bailout is definitely not in the best interests of our country, nor is it in the best interests of the auto workers themselves. It’s totally short-sighted. And FWIW I think the whole financial bailout was just as dumb.

I have family members who used to work for GM for years (not in the automobile division of the company though). If they were still working for GM today, I’d sooner see them lose their jobs and have to find new work elsewhere than encourage them to live under the illusion that their company should continue doing business as usual. As I mentioned previously, I bought a Japanese car in 2006 even though I could have gotten a great price break on a GM model. I just didn’t like any GM cars.

During a recession some companies are going to die off. That’s a good thing. To artificially prop up the proven market losers is just dumb. Sure, it will have some rippling consequences. But those ripples are necessary. We need that sort of self-correction to prevent bigger problems down the road. We need to send a message that if you fail to create and deliver value people genuinely want, your business will ultimately fail, and no amount of political lobbying will save you. Of course we get the opposite result when too many people think that the point of life is to chase dollars, especially our politicians. Can you blame them though? Have you ever been known to fall into the same trap?

It’s better — and much more compassionate — for millions of auto workers to lose their jobs and be re-integrated back into society, where they can start doing socially useful work again instead of wasting their time doing work that simply isn’t needed anymore. If it takes years, it takes years. There are other companies that are doing a better job of providing what people want and adapting to the planet’s changing transportation needs. Giving more money to the losers is a stupid strategy.

Similarly, if you work for a company that is falling out of sync with creating and delivering value that people want, you should indeed lose your job. It’s better to retrain yourself to do more meaningful work elsewhere than to waste your time doing work that isn’t needed. Becoming obsolete is a trap that can be avoided. Even if you’re an employee, you still need to make sure you’re contributing to the creation and delivery of real value. If you fall away from that, it’s only a matter of time before you get the axe, so don’t be too surprised when it happens.