Saturday, April 19, 2008

The Cheese Is Moving. And It's Not Going To Stop

Economist Don Boudreaux, of George Mason University, sent the following gem to The Washington Post:

Emily DeRocco complains that "The April 9 Business article 'Don't Blame NAFTA for Downturn, Many Economists Say' quoted politicians, economists and labor representatives but not a single manufacturer - those at the heart of this wrenching debate" (Letters, April 12).

She's mistaken. Those at the heart of this debate aren't manufacturers (or politicians, economists, or labor representatives). Those at the heart of this debate are consumers. Or, those at the heart of this debate should be consumers.
Unfortunately, consumers are too large in number and too disparate in interests to organize effectively for political purposes. The result is that consumers' interests in trade discussions are largely ignored, even though an economy's success is measured not by how well that economy satisfies the wishes of producers, but exclusively by how well, over time, it satisfies the demands of consumers.


Donald J. Boudreaux

If you hit the link above, Boudreaux goes on to say that "Producers exist to satisfy consumers; production is the means and consumption is the end. Protectionism is a policy built on the premise that consumers exist to satisfy producers."

Lord have mercy, that man can type.

If nobody wants what you're making, or if someone else makes it better than you, or if they make the same thing for less cost, whose problem should it be?

Look at the little self-help/business book "Who Moved My Cheese?" when you get a chance. It's a parable about some mice in a maze who show up at the same spot every day for cheese. One day, the cheese stops appearing. (Full Disclosure: My cheese disappears on a regular, predictable basis. I have a tendency to irritate those who bring cheese....) Half the mice get busy and look elsewhere for cheese, and eventually find more. The others, at the encouragement of their misguided leaders, sit and wait for the glory days of cheese production to return. (See Mitt Romney's campaign promises.)

Obama and McCain, to some extent, have told people that the cheese has moved, and they'll have to move to find it.
When Obama accused some of the mice of being "bitter", he spoke the truth.
The Clintons and Kucinich have generally declared that the problem lies with the unfairness of the cheese-movers.
Romney promised Detroit that he would bring back the cheese. If elected, he'd make cheese fall from heaven like manna fell on the Children Of Israel.

The company where I work has a market that is constantly moving. We never do the same thing for more than a year. I don't want to tempt fate by saying "You Can't Hide Our Cheese Where We Can't Find It", because deep down, I'm superstitious.

But I don't think you will ever hear us complain about unfair competition. Like Galileo told The Church: The Cheese moves.


zbethwalker said...

Dr. Liz says:
Back in the seventies some guy wrote a book about why Detroit lost it.
According to this author, the problem was bringing in Harvard MBAs to run the business.

The Whited Sepulchre said...

They've written a similar book about Buffalo N.Y.
Something to do with corrupt Unions, confiscatory tax rates, and blah blah blah. All the usual things that are moving the U.S. center of population to the South/West at the rate of 5 miles per year.

r.e. - the Harvard MBA's....I think the best thing about the MBA bidness....the people you meet while getting your degree. You wind up with some great connections that you can call on when confused. Which, in my case, is most of the time.