Archive for the ‘Uncategorized’ Category

Our Evolving Social Contract

Tuesday, December 1st, 2015

https://www.youtube.com/watch?v=h6A0mOJfjWs

Financing Good Deeds

Wednesday, May 8th, 2013

Here is the question. How can we as a society in the United States maximize the good things we are able to do with our wealth? One of course starts to think about the efficiency of public vs. private support of good deeds, but let’s set the efficiency issue aside for now and just deal with the main question: how can we maximize good deed creation? That is, how many good deeds can we afford?

I would propose that somewhere there is a mathematical response to this question. That is, I believe if we all create wealth without regard to worthy causes, that would not maximize the good things we are able to do. But the converse is also true – i.e., if we use all our wealth to do good deeds we will soon find we have no wealth, and realize that investment of our wealth is necessary to further grow this wealth and thus our ability to do more good things. The optimum point lies somewhere in the middle.

This presupposes a graph, a curve, with wealth creation on the x axis and good deeds on the y axis.

Forgive the standard bell-type curve. We don’t really know what the curve would look like, because no one has yet done the work. But isn’t this what our present day political discussion is all about? Some people think a lot more wealth can be taken out of the economy and used for purposes that do not create further wealth. Others think we are near that inflection point where taking more dollars out of investment and using them for consumption – i.e., doing good deeds – will push us over the top, like a roller coaster, and start us on the downward path toward less wealth and thus less ability to do good things.

In our society today it is unfashionable to do math. But maybe we need to do these calculations.

THE GREAT GAME REDUX

Thursday, November 29th, 2012

Consider this possibility. The President is not concerned about the next four years and his legacy arising therefrom. His time frame is much longer. Let’s say 24 years. His legacy will take that much time to develop. All he has to do is keep his voting coalition together. If future candidates can count on 95% of the black vote and majorities among women and other minority groups, they will be elected. President Obama knows how to do this. He is very good at it. Electing future Presidents with this strategy will bring him immense power whether he is President or not.

Given the above, what is his short term goal? To keep his voters’ support. Over a long time. Does addressing the Fiscal Cliff help in this goal? Much better to go over the cliff and blame it on the other party, his successful strategy the previous four years. People will feel the pain of poor economic policy, but they will blame it on the Republicans. That keeps the mid-term election in play, and allows him to start – now – shooting for 2016.

Further, going over the cliff increases tax revenue greatly by taxing the middle class. And whose fault is it? Not his, under this scenario. The fault will lie with the Republicans. And a lot more tax revenue is needed if government spending is to stay at the President’s preferred 24% of GDP. Or maybe higher.

Right now it seems the Republicans are executing his play book. Far better to pass the “millionaire” tax in the house, and then check to the raiser.

Jim Hirshfield

Today in Kviv

Sunday, September 30th, 2012

Sergei, our 50 something year old guide, sighed and said “They were dreamers”. He was qualified to offer an opinion. His early days spent in a commune, he later graduated University and served as a scientist for the Soviet Union. Now he was our tour guide in Kvev, Ukraine, a city of 4 million, which had been part of the USSR until twenty odd years ago. Kviv is located some 60 miles south of Chernobyl. After that meltdown, his wife took their young son and moved away from the radiation risk. They now live in Los Angeles. But Sergei is still in Kviv, trying to help people understand the difficult history of his homeland. “They wanted everyone to be equal, to have a better life”, he says. “But they were dreamers. When my mother dies I think I will become a monk. I hope to live to be 100”.

Government Spending

Sunday, May 20th, 2012

Federal government spending is of necessity limited by the amount of economic growth in the country.

Adam Smith meets Occupy Wall Street

Wednesday, October 19th, 2011

Some 235 years ago Adam Smith wrote about what we call “the invisible hand”. Smith said that as each individual works to improve his or her own personal situation this results in an improvement for the economy as a whole, and thus improves everyone’s welfare. This principle has become recognized as one of the key drivers of the enormous wealth created over the last 200 years, and the consequent improvement in living standards for all who live in societies so guided.

This improvement in living conditions is sometimes hard to grasp. I was at a history lecture a few years ago where the lecturing Professor was asked “Did wealthy people 100 years ago live as well as wealthy people do today?” His response was that “100 years ago no one in our country lived as well as the poorest of us today”. We forget that a bath was a bi annual affair. Inside plumbing was just coming into use, as were cars, airplanes, and electricity. Radio, TV and things such as cell phones were a distant dream.

So what does Adam Smith have to do with the Occupy Wall Street protests? The protesters have varied objectives, but it seems that one recurring theme is to get rid of “corporate greed”. A corporation is, of course, a legal person allowed by law for the purpose of aggregating wealth for use in pursuing expensive ventures. Corporate greed? The invisible hand? Sounds like the same thing to me.

Do the Occupy Wall Street protestors want to throw out this approach to creating national wealth, and the consequent benefits it has accrued in recent centuries? People like Karl Marx also wanted to throw out this approach, but he offered an alternative. Unfortunately for his adherents, his alternative was a colossal failure in countries that tried it. But the question remains, what do these protestors want as an alternative?

One adage we hear a lot these days is not to quit your job until you have another one lined up. Shouldn’t we say the same thing about replacing economic system that lies at the base of our long term growth in prosperity?

Questions for Life

Tuesday, May 31st, 2011

1. Relative to what? We all have opinions, but they are all relative to some base assumptions that we often do not choose to examine.

2. Who are they? The infamous “they”. When a business representative, referring to another area of his or her company, says “they will/will not . . . “, how do you feel?

3. When should I do it? How about now?

4. How do I get people to listen to me? Is it the quality of the information, or how it is presented? Or where? Or to whom, which is usually how this question is directed.

Jim Hirshfield
May 26, 2011

CUSTOMER SERVICE

Thursday, October 1st, 2009

Any organization that serves others must provide what is commonly called Customer Service. That is, when a customer has an issue, they need some one to call who will get the issue resolved. Here are some thoughts on providing excellent Customer Service:

1. Don’t give the customer any reason to call. That is, anticipate and fix problems before the customer ever sees their effects. We used to hold top level weekly meetings where we reviewed all unsolved customer service problems. More often than not these were new issues, often easily solved, but things the customer service people had not been trained to address.
2. Get rid of those extensive call director menus, and allow your customer to talk to a real person, quickly. I know this is a cost issue. My solution? Allow the customer to self select into a longer automated queue if they are comfortable doing so.
3. Have your Customer Service people take charge of the customer’s problem, lift it off of the customer’s shoulders, give your people a procedure for dealing with these things, and compensate them for doing so. Get back to the customer when a solution is provided.
4. Training, training, training. How can you expect your customer service people to know the answers to all the problems that might come up if you do not gather information company wide, craft solutions, and inform your people about them?
5. Compensation. Craft a structure to pay good employees for good work, as an incentive compensation plan laid over base wage.

Remember, you will not receive a call from your customer when he switches to your competitor.

Health Care Reform

Sunday, September 13th, 2009

Health Care Reform

It is interesting how the process of making public policy highlights so many of the business adages in my book Fortune & Freedom: The Entrepreneur’s guide to Success. Previously I wrote about the need to define the problem before you attempt to solve it, and noted that little of this had been done in the national debate on health care. Someone must have read my blog, because starting shortly thereafter all I have been hearing about is the goals of health care reform. Unfortunately, there has been little discussion about specifics that would address those goals.

So let me give you an illustration of a business fallacy titled “Oh no, you did exactly what I told you to do!” See the picture in my book of the man with anguish on his face? He has just seen the result of his hasty solution to a problem he has not taken the time to define and analyze. Will this be all of us after the Health Care Reform initiatives become law? Or, to say it another way, let’s go back to the issue raised above, define the problems we are working to solve (there are plenty of them), and discuss and agree on solutions to those problems.

It seems to me that most people agree on the need and the goals of health care reform. The problems lie in laying out solutions to specific health care problems, and discussing and agreeing on these solutions. Pretty much all the discussion I have heard to date is vilifying the other guy for not agreeing with you. You certainly could not stay in business if you ran your company that way.

HEALTH CARE CONUNDRUM

Wednesday, June 24th, 2009

In my book “Fortune & Freedom” The Entrepreneur’s Guide to Success”, I note in Part IV that identifying the problem before solving it is priority number one. I quote my middle school math teacher who said: “If I had ten minutes to solve a problem, I would spend eight minutes reading it.” So what is the problem we intend to solve with the proposed new Health Care Legislation? Is it covering people who do not have Health Care Insurance? Covering people who do not want health insurance? Or is it cost?

The President at various times says it is both, and that the present high cost of health care is caused by the profits of the for-profit insurance companies (not all providers are for-profit organizations). Some politicians such as Robert Reich assert that government competition to private providers will bring down the cost. (If you believe that, I have a bridge in Brooklyn I want to sell you – but back to the subject at hand). So what is the problem we are trying to solve?

And, of course, the above is only talking about the evidence of the problem, not its causes. So once we decide whether we are solving the problem of cost or coverage, we then need to identify the drivers, the problems that cause high cost or spotty coverage. Only after these drivers are defined and agreed to can we start to craft a solution.

Have you heard the phrase “A solution in search of a problem”? We need to be careful what we wish for. Our wish might be granted.

Jim