How many times have you heard the virtues of "Competition" or "Free Enterprise"? Competition is good. Right? We need more competition not less. Competition makes you stronger and products cheaper. Have you heard these things too? Do you agree that competition is good? Did you ever think about "why" competition optimizes so many things? Most of us have not. What I want to do is to stand back and look at competition in a different way.
First, football and the NFL. Last year, the Green Bay Packers were looking at an undefeated season. I think you must remember that. Well, what happened to that plan? Kansas City, that is who. On of the weakest teams in the league beat the Green Bay Packers and ended their hopes for and undefeated season. There is a point to all this. Competition tends to "equalize" the teams contrary to what you might think. If a team can not get itself "equal" or close to "equal", they are eliminated and the people or players in this case move on to other teams. There are more people playing professional football today than at any time in our history, not fewer. The net affect of competition is not to eliminate jobs, but to maximize jobs. Follow me on this?
Now, let's look at business. If one company gets way out front of the competition, they don't stay there for ever. Other companies and in some cases new companies catch up. Look at IBM in 1970 compared to today. Apple was not even around, but look where they are today. It was competition. Look at Hewlett Packard, I recall when they were on top too, but now they are fighting for their life. I could go on and on, but now I want to bring out another point about competition. Like football, the margin that separate teams and companies is not very much. One company may earn 5%-10% profit, but the companies below then earn almost as much. The difference is just a few % points. The reason that I point out the small difference is that it does not take much to move a team or a company up or down. A new quarterback or and injury or a new product. What about a bad draft? It is the same in business. Look at GMC with the Volt. The Volt was clearly a business error and it has cost GMC. How about the Saturn division? It is gone now. A business like a football team can not make very many errors or they will drop to the bottom and be out of business. My point is that this is one big balancing act and it does not take all that much to push a team or a company over the cliff. The point is that few teams or companies have the resources to squander and it is the same for a country.
Look at the USA and see if we have made good competitive decisions. At the Federal government level and even at the state and local level, we have made some very bad decisions. Like a team or any company, we can go out of business too. Look at the wages and benefits given ot public employee unions. These bad decisions alone may be enough to bring down our government. Some cities have already filed for bankruptcy. Are you starting to get the point? We as a country have competition from other countries around the world. China is cleaning our clock right now and it has been mostly due to our poor decisions and squandering of our national wealth. Just Obama's war on coal alone may be enough to bring our economy down. We like the NFL football teams do not have all that much margin for error. Green energy is another example of squandering our wealth and opportunity. How about all our kids now going to college taking majors that are worthless? My guess is that 75% of our kids in college that are costing us so much are taking worthless majors. You know and I know it, so why have we all been so silent? Government regulations are killing our economy and like medicine, the cure is worse than the sickness. We are fighting $1.00 problems with $100.00 medicine and we can't afford it. There is not that much profit margin to survive the cost that we are now running up. No one ever questions whether we are getting our monies worth. If you are not, just like football or business, you are not going to be around long. That is the bottom line. We need to wake up and think about our actions and ask if they are "worth it or not".
PS-------------Here is a little side note. I blogged in the past about "brittleness". That is where a system like a business due to competition pushes the envelope higher to produce more profit and lower cost products. Like all up sides, they also have a down side. At this point, businesses and governmental systems become "brittle". This means that they can fall with a crash if the right pins are pulled out. The USA has one of the most brittle economic systems in the world. A poorly thought out change in government policy can be enough to bring down a system like ours. That has been the point of this whole blog. The advise for any brittle system is the use caution in making even the smallest changes or you could "crash" the system. Obama is just the person that a system like the USA does not need. With Obama at the controls, he could crash a Piper Cub and this airplane is a lot more complex than a Piper Cub.
