Our Religion Of Economism Is Bankrupt

I have to admit that I am not a “true” believer in the capitalist system belief that we must always consume more and more as the years pass.  My ingrained simplicity seems to be very counter to that idea.

2016-09-20_18-34-21.pngIn both religion and economics, absurd belief too often leads to atrocious action.While the consequences of misguided belief are well-documented in the study of religion, we rarely use comparable standards to critique the religious-like faith bestowed upon our current economic system. We believe that economic “growth” is the single most important key to unlocking the sacred doors of life, liberty, and the pursuit of happiness. However, the facts of the matter and narratives of the masses reveal a far different picture. As our globalized fiscal cycle is now calibrated to impose repeated tragic failures, and because it seems to legitimize inequality and destruction of the Earth as virtuous and inevitable, the time is long overdue to expose the false beliefs and oppressive impact surrounding our contemporary economic edifice.

Source: Our Religion Of Economism Is Bankrupt

It is interesting to see the commonality between our current religious systems and our economic system. I have been convinced for some time now that religions as they exist today are out of tune with the times.  Most seem to be stuck in a 19th century mode of flat-earth and Victorian morality. There are just too many people, particularly in the religious realm,  who have failed to accept our national diversity and the corresponding social changes that have occurred.

Our economic system of more and more seems to be in that same mode. It is not good enough for a corporation to provide a healthy dividend year over year to it stockholders, they must now grow to a bigger and bigger bureaucracy. This never big enough mentality is primarily responsible for much of the outsourcing that has been going on. You must maximize profits in EVERY way possible or you will go down in the dustbowl of history.

Maybe it is time to say “enough is enough”. Maybe it is time to bring back the three-legged-stool where the customers, the workers,and the stockholders have equal weighting in corporate decisions.  Maybe it is time to realize that growth for its own sake is killing our capitalistic system.  But how do you accomplish that and who will actually be the first CEO to institute it?  That is the major question of our times.

The Next Step

Amazon is growing in leaps and bounds so it just makes sense that they start their own air delivery system both big and small. In order to control costs end-to-end processes are required and that is just what Amazon is doing.

2016-08-05_07-36-34SEATTLE (AP) — Seattle-based Amazon is unveiling its first branded cargo plane, one of 40 jetliners that will make up the e-commerce giant’s own air transportation network as it takes more control of its delivery process.

Source: Amazon unveils cargo plane as it expands delivery network – Business Insider

I have been a pretty constant Amazon customer for the past 15 years or so.  I wish I could say that I have also been a stockholder for that period but this seems to be another example of lost opportunities for me.  :)  I simply like the convenience of getting what I need without gassing up the car and driving the 45 miles round trip to most stores. The variety of goods that Amazon now carries is astounding and seems to grow daily.

I am convinced that Amazon is the next paradigm shift in how we get much of what we need. Maybe clothes, a high touch item, and food are not totally compliant with remote sales but Amazon is even testing those areas.  It seems inevitable that they will be the Walmart of the 21st century in that they will dominate the consumer retail sales.  For them to become number one means Walmart will have to shrink and that will mean lost jobs at many rural locations where jobs are needed the most. But since Walmart is pretty much a minimum wage employer not as much is lost as is gained in  areas where Amazon builds regional fulfillment centers. I just checked the Amazon regional center near me and it appears that they pay about $12 to $14/hour compared to Walmart’s $7 – $11/hour.  I know that Amazon has a reputation of expecting their employees to perform at fully involved levels that are not comfortable for some. I also know that their centers are highly automated.

Amazon is one of those forward thinking companies that is just not satisfied with the status quo. They are even investigating drone delivery to locations close to their centers. Is all this a good thing?  I guess it depends on your point of view doesn’t it?

Innovation…

The main crux of this post is about whether a company can remain innovative as it ages. I want to use Sears and Amazon as study points. Being a U.S. history buff I can’t help but draw a parallel between Sears in the early 20th century and Amazon a hundred years later.  Here with the help of Wiki here is a little history of Sears:

2016-07-17_15-51-55.png Farmers did business in small rural towns. Before the Sears catalog, farmers typically bought supplies (often at high prices and on credit) from local general stores with narrow selections of goods.   Prices were negotiated, and depended on the storekeeper’s estimate of a customer’s creditworthiness. Sears took advantage of this by publishing catalogs offering customers a wider selection of products at clearly stated prices. The business grew quickly. The first Sears catalog was published in 1888.   By 1895, the company was producing a 532-page catalog. Sales were greater than $400,000 in 1893 and more than $750,000 two years later. …

In 1993, Sears terminated its famous general merchandise catalog because of sinking sales and profits…

Source: Sears – Wikipedia, the free encyclopedia

The parallels between Amazon and Sears startups are quite striking.  Jeff Bezos started the company in 1995 with the idea to sell books on-line. It quickly grew in both sales and product offerings so that today it is by far the number one retailer on-line.

2016-07-17_15-53-10.pngAccording to recent industry figures, Amazon is the leading e-retailer in the United States with more than 107 billion U.S. dollars in 2015 net sales. The majority of the company’s revenues are generated through the sale of electronics and other products, followed by media and other activities. As of the fourth quarter of 2015, the e-retailer reported more than 304 million active customer accounts worldwide. Due to Amazon’s global scope and reach, it is also considered one of the most valuable brands worldwide.

Source: Amazon – Statistics & Facts | Statista

One of the striking things about Amazon beside their explosive product line is the speed at which they deliver their products. For $79/year you can get unlimited 2 day delivery at no cost.  I must admit I am a major customer who places orders probably 30+ times a year for the last several years.

Because it wasn’t available on-line I recently ordered a drawer unit for my micro-RV remodel from Sears.  I was told that it would take 2 – 3 weeks for delivery. In Amazon time which is now the norm for me that is an outrageously long. Somewhere along the line Sears just lost their innovative edge. The Sears store in Bloomington just closed down so now I have to travel about 50 miles to pick up my cabinet.  It is either that or pay $70 to have it delivered!

I find it ironic that just as Sears was terminating their catalog sales a young Jeff Bezos was planning on starting one on-line.  For 2015 Sears revenue decreased by $6.1 billion to $25 billion while Amazon revenues were $107 billion.   I wonder what would have happened in 1993 if Sears had decided to aggressively take their catalog on-line instead of abandoning it?  I am personally convinced that on-line sales is the wave of the future.  Why do I need to get in the car, drive to a store, and lug my purchases home when all I have to do instead is just click a few buttons and in two days it appears on my doorstep.

When Robots Make Cars….

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I know that robots have taken over many of the repetitive tasks from us humans. Many see that as stripping jobs away from those who don’t care to otherwise be ready for today’s workforce.  The mind-numbing jobs are being taken over my mindless robots and that is as it should be. Let’s take auto manufacturing as an example:

  • Robots don’t make mistakes... They do the same thing over and over again because that is all they are programmed to do.
  • Robots don’t know Monday from Friday…. They don’t take their eye off the task at hand because they are still remembering the weekend or are anticipating the coming one.
  • Robots can do the same thing over and over with the same accuracy…. Not only do they not make mistakes but they do what they are programmed to do with extreme accuracy. They simply don’t have other distractions on their minds.

Let’s face it, compared to today’s cars, the cars of the 1970s, 80s, and 90s were junk. The fit and finish were terrible and the lemons made because of absent minded defects were very troublesome to those who were unfortunate enough to get them. Humans just never did a good job of making cars.

So where does that leave us humans? For those unprepared for anything else but mindless  assembly line work it leaves them with flipping hamburgers or other low skilled work  that were once meant as entry type jobs. But for those willing to put in the effort to equip themselves with the necessary skills it leaves them with opportunity. Many young people today are taking that opportunity but many are not. Some think they are not smart enough to learn, some just can’t afford it. The later needs our help but then again so does the former.

We need to make higher education more affordable, if not free, for anyone who wants to improve themselves.  Free high school education has been the norm now for many decades and now its time to kick that up a notch to at least two years of free trade school or college.

For those who don’t think they are smart enough we need to do a better job of encouraging them. We need to make learning as important to them as high school sports are now.  Part of that is a teacher thing but the biggest share belongs to the parents.