The death of common sense

Milton Friedman recalled traveling to an Asian country in the 1960s and visiting a worksite where a new canal was being built. He was shocked to see that, instead of modern tractors and earth movers, the workers had shovels. He asked why there were so few machines. The government bureaucrat explained: “You don’t understand. This is a jobs program.” To which Milton replied: “Oh, I thought you were trying to build a canal. If it’s jobs you want, then you should give these workers spoons, not shovels.”

Government is notorious for not being productive.  That’s not its job.  It is the job of the private sector, business people and capitalism.  When firms compete against each other, they find ways gain short term advantages though lower costs, higher quality, innovation and productivity.  This in turn frees up capital to be used for other purposes.  Capitalism is a fluxating dynamic growth engine.  Government is not.  When it comes to businesses, Government is a static wealth redistribution monopoly.

Milton Friedman knew how to create real wealth-producing jobs. Once, when he visited India in the early 1960s, John Kenneth Galbraith, the U.S. ambassador, welcomed him by only half-joking, “I can think of no place where your free-market ideas can do less harm than in India.” Talk about irony. India has adopted much of the Friedman free-market model and has moved nearly 200 million people out of destitution and despair.

Recently Rose Friedman (Milton’s wife and co-author) was asked what she thought about the attacks on her husband and capitalism. She was mostly dismayed at how far off-course our country has veered under President Obama. “Is this the death of Milton’s ideas?”. “Oh no,” she replied, “But it is the death of common sense.”

Limited Intervention

Treasury Secretary Timothy Geithner told the House Financial Sevices Committee during his testimony that the Administration’s reform plan includes four broad components:

1. Addressing Systematic Risk
2. Protecting Consumers and investors
3. Eliminating Gaps in Regulatory Structure
4. Fostering International Coordination

All good goals but when did our Government become one gigantic consumer protection agency?  What about strengthing our capital markets, streamlining red tape, encouraging small business growth & innovation?  When you are going to grow youself out of a recession and begin hiring again, you first need to grow.

How productive are you?

We have a one time event for a non-profit coming up in a week that has been scheduled for a year now. The project leader never made a timeline of important tasks that needed to get done. They never trained people on the different software packages or delegated responsibility of what had to get done. And now, one week before the event, a major life changing event (and not the good kind) has affected the project leader.

What kind of backup plan does your organization have?
Are you a hand’s on leader who maybe should not be?

I know of a small one man firm with a great product, excellent customer service and fantastic prices. He has customers lined up outside his door and around the corner every day.
He would like to grow and know he can easily except…

Except no one can do the little things he does every day just like he does and teaching them and managing others would take away his productive time. And so, he will always be a small one man firm.

Learn what the key points of your business are and learn to delegate everything else. Figure out how to replicate yourself and then clone your success many times over just like a franchise restaurant (McDonalds) does.