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Good Morning

Cue the music

Some more bad news on the research front.  Earlier this week, Merck laid off a number of employees from the parent company and Schering-Plough, the company it merged with a couple years ago.  I can’t find a firm number for the total layoffs.  In some reports, it’s 17,000, in others it is 17,000 plus an additional 13,000.  That’s worldwide.  And while Merck has something like 91,000 employees worldwide, when it comes to laying off research, it comes primarily from the US side because American research workers have zero labor protections.  I would expect the loss from Western European research facilities to be light.  Estimated cost savings are $400 million out of a budget of $7.9 billion.  That is a huge research budget but that’s what it takes these days.  Drug discovery is very expensive.  Merck and Schering-Plough have facilities in the Northeast, particularly in Rahway, NJ, West Point, PA and Kennilworth, NJ.  Derek Lowe at In the Pipeline says he is getting heavy casualty reports in from the research professionals at Schering Plough (Kennilworth).  I know people who work at both companies and I’m very sad for them.  This is not a good time to be untethered from a steady income.  I hope they’ve prepared themselves.  The loss to the states of NJ and PA in tax revenue from cutting these well-paying jobs is going to be pretty bad.  So, this month we have Novartis, Amgen and Merck-Schering-Plough.  Wait, wasn’t there another one?  Too many to keep track of.  And more competition for me.  Well, I am in good company.  Some of the smartest people in the country, no, the *world* are now out of work.

Jay Ackroyd thinks that the desire to globalize is driving this and calling it “centrism”.  Jay’s anger and disgust is pretty clear but coming from the corporate world that most lefties hate, hate, HATE with all their souls, I see this a little differently.  For example, take the way Steve Jobs was pushed out of Apple back in the 80’s.  I’m listening to the biography by Walter Isaacson.  Jobs was no saint.  Back in the 80s, he was the heartless boss from hell.  I guess you could chalk that up to youthful immaturity but when the precariousness of his position at Apple hit him, he got a sense of how companies would work in the future.  John Sculley, the president Jobs hired to run Apple, was a marketing guy.  He didn’t understand the product he was manufacturing.  He wanted to spin off the creative part of Apple to a unit called Apple Labs, that would be run by Jobs.  It was a way to get rid of Jobs and his loyal creative types who wanted to act like pirates.  Sculley wanted employees to put Apple, the company, first.  People like Jobs wanted to put the product first.  It’s too bad that he acted like such an obnoxious, insulting immature brat because Jobs was right.  Most companies have followed the Sculley route.  They put sales and marketing and making money first.  And that’s what companies are for, to make money.  You’d have to be stupid if you had any altruistic aspirations for having a company.  But what marketing people fail to see is that without a product, you have nothing to sell.  If you short your R&D division, you’ll be cutting your own throat. It won’t happen overnight but it will happen.  And then you’ll be busily eating your seed corn to make those quarterly earnings, like Merck, Pfizer, Novartis, Amgen…  After Jobs grew up a bit and came back to Apple, he put the focus back on innovative products and now, the company is the most profitable in the world.

So what does this have to do with Ackroyd’s piece?  Well, if pharma is any indication of what is really going on, globalization is a fad.  That’s what the business people do.  They chase fads and trends.  They rarely follow up on their initial enthusiasm to see if the fads actually add to their bottom lines.  It’s the initial savings that they care about because that’s immediate, it’s quarterly and they think better in 3 month increments.  Pharma went through a period of mergers and acquisitions that did nothing for research and only enriched executives’ pockets.  But there have been other fads, like combinatorial chemistry, proteomics, siRNA, and genomics.  None of them turned out to be the panacea the Sculley class was looking for because the nature of biology is such that these technologies were just tools that we used to dig up more problems to solve.  They were never intended to be solutions all by themselves.  The newest fad is to relocate all of research (or what is left) in the bay areas, Cambridge,MA and San Francisco and San Diego, CA.  Presumably, the smartest people in the world graduate from MIT and Harvard and Stanford and UCSD.  That may be true.  But it may also be the case that only the wealthy and well connected can get into those schools anymore.  It also ignores the fact that for years, biomedical researchers came from all over the country, prestigious and unprestigious schools alike.  I’ve known excellent researchers who graduated from schools in Indiana, Colorado, New Jersey and Louisiana.  But this idea of educational exclusivity and capturing the elite is the new fad.  They will do the brain work and the hands on stuff will be carried out by a bunch of drones in China and India.  The corporate guys are marketing and sales and business school guys.  They think research and innovation can be broken down to a list of mind numbing chores and “just in time” off the shelf solutions while the “better people”, people like them in their social class, are graduating from ivy league schools and those people have the natural talent to manage the innovation process.  The corporation will take the profits gained by outsourcing.

And they are following this course of action and business not because it is good for the companies they serve but because they can.  The rules don’t apply to them anymore.  I’m not sure the goal was always globalization but now that there’s nothing to stop them, that’s what they’re going to do even if it ruins the product line.  The Sculleys of this world do not understand what motivates people who do research and who are inspired to innovate.  Here’s a clue: the most profitable product line of the world was designed by a college drop out and his rag tag bunch of unorthodox pirates who were left to their own devices.

So, Jay, I wouldn’t worry too much about the desire to globalize.  At some point, the grasshoppers will stop eating their seed corn because there will be nothing left, the big corporations you hate will find themselves smaller and their research divisions located in Western Europe and the fascination for the elite universities will be tempered by the reality that real innovation takes time and dedication and getting the right people *together* in one place.  At some point, the researchers in China and India will get fed up with studying hard for years only to be treated like cheap assembly line workers by the Sculley class.  It would also help if lefties took some time to understand pharma so they would stop contributing to the demise of biomedical research through bone headed ignorance.  But that’s another post.  Yeah, it may mean that the innovation infrastructure of the US is decimated.  But I wouldn’t be looking for meaning in any of this.  Think of it like water flowing in the path of least resistance.  There’s nothing intelligent about this, as in sentient beings planning to gut their product lines for the sake of a quick buck.  There’s no giant conspiracy to globalize.  It’s happening because we allowed it to happen.

When we block the path to a quick buck at the middle class’ expense, it will stop.  And we know this is possible because there are countries where the government has protected their innovative infrastructure.  When the dust settles and the corporations come to their senses, it will be the middle class in places like Germany and France who will be able to carry on.  If we want to be one of those countries, we have to decide that we want to reimpose the rules.  There’s no need to over analyze.  But I would like to point out that saving innovation here does not mean that we as a country will not be taking advantage of cheap labor elsewhere.  As Nucky Thompson says, “We all need to decide how much sin we can live with.”

In other news, if the election were held today, guess which politician would have the best chance of beating the Republicans?  It’s Hillary.  Yep, sorry lefties who hate Hillary, in a recent Time Magazine poll she beats the Republicans by larger margins than Obama does and she’s not even in the race (yet):

A national poll conducted for TIME on Oct. 9 and 10 found that if Clinton were the Democratic nominee for President in 2012, she would best Mitt Romney 55% to 38%, Rick Perry 58% to 32% and Herman Cain 56% to 34% among likely voters in a general election. The same poll found that President Obama would edge Romney by just 46% to 43%, Perry by 50% to 38% and Cain by 49% to 37% among likely voters.

Read more: http://swampland.time.com/2011/10/27/hillary-clinton-and-the-limits-of-power/#ixzz1cBO8BDMj

It always amuses me when the left starts to hyperventilate about the prospect of a Republican president next year and how evil that would be.  But when you give them a perfectly acceptable alternative of someone with a lot of experience, who is excelling in foreign policy, runs a global executive branch and has been able to stay away from domestic issues to emerge fresh as a rose, while being widely admired by world leaders and voters of both parties, they flinch when it turns out to be Hillary.  Apparently, they are MORE afraid of Hillary Clinton in the White House than Mitt Romney or Herman Cain or, gawd help us, Governor Rick “Good Hair” Perry.

No?  That’s not how it is?  There’s something I’m missing?  Oh, her Iraq War Resolution vote.  Yeah, she single handedly brought on the Iraq War.  Of all 99 senators who voted for that POS in 2003, HER vote counted more than anyone elses.  It was even more powerful than John Edwards’ IRW vote.  It had to be because the left was perfectly happy to forgive and forget that reckless phony.

I can just see them gearing up to spew some anti Hillary hatespiel.  No, no, save your breath.  No one cares what you think of Hillary anymore.  Your opinions are not more important than the rest of the electorate.  She should have her opportunity because the Democrats don’t really have anyone better, not even Obama.  No one is entitled to a second term.

But if you get stuck with a Republican in November 2012, you have no one to blame but yourselves.  Hillary wins over all of them, you passed anyway.

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34 Responses

  1. I worked for the same company for 30 years. Back in the 70’s they used to have a strong research organization. New chemicals and processes were being developed – now it is a shell – whole departments totally gone – everyone from the PHD’s to the lab techs vanished from the company. Nothing left but the actual production units and they are quite old. Like Pharma, people think we can exist with out chemicals or new product and I guess we can but life will be more complicated.

    It is the development and production of drugs and chemicals in a safe and quality environment that is critical to maintaining much of what we enjoy and take for granted. I have known people who think there isn’t much difference between generic aspirin and name brand aspirin but they don’t know about the quality control differences – yes, sometimes they come out of the same production facility but the quality control is different. That is why some people react differently to generic drugs than the name brand drugs. I can’t say this is true for all cases but it does happen. It can be as simple as the binders used for the active ingredients.

    I saw the changes in the company I worked for coming when the technical leaders at the corporate level were being replaced with finance and marketing people. There were many top leaders in the company that left because they couldn’t stand the way the company was moving – away from technology and to mergers as a means to grow.

    I was fortunate that I was close to retirement so I could take my package and still have a relatively secure financial life due to many years of saving. That being said – I still help my recent college grad who is only working part time and my brother who is also working part-time. Their out look isn’t as good but at lease they are both in good health.

    • Yeah, at some point, there will be an, “oh, shit, what did we do?” moment. There is money out there and it will invest in areas where the returns are quick and guaranteed. That is never going to be research.

      • This happened with computing too probably started about 15 years ago. Some of it has come back because it didnt’ work, but being on the US team means dealing with poorly trained counterparts in some 3rd world country where they get more PTO and aren’t held accountable to deliver anything.

        They always have network problems and everything (and I mean EVERYTHING) turned over has to be re-done by the American team or we are reamed for any mistakes while the overseas team goes on vacation – again.

  2. F#%^! It is snowing.

    • Your reaction is joy to my ears and our confirms our decision to head southwest to get away from that stuff! Be safe if you have to travel.

  3. Some people can’t be told. Back in the 1980’s I used to argue the fact that when manufacturing left we would end up with what we have today. I was told that we would become innovators, designing new manufacturing processes and financial products to sell to the rest of the world. Well Napster shows what can happen with intellectual property and credit default swaps demonstrates the outcome of ever riskier financial products.

    • yep. I remember that – but then it was happening to the lesser skilled union workers who wanted too much for what they offered… and then it moves to everyone else.

      It will stop when they start outsourcing the board of directors to the 3rd world.

      • Oh, I should say that the “lesser skilled union” comment seemed like the prevailing attitude at the time, not my attitude.

        I think it is one industry at a time turning up the heat slowly on us frogs in the pot.

      • OT, but I made this comment to you in the previous thread regarding how we women ought to stand up for each other and have each other’s back. Also partly in response to RD about the situation in Scandinavia. The thread closed before I got to post so here …

        Funny (not really!) that you should say that, as just this afternoon I was listening to a discussion on Danish National Broadcast about the “redstockings” – women’s lib – back in the 60s. The host was a 30something female, and of the guests 3 were women in their 60s, and 1 a male in his late 40s.

        So they are discussing appearance and the guy mentions one of the frontrunners of the movement, someone to whom all Danish women owe a lot, and recalls how she stopped wearing makeup, how sad and insignificant that made her, and all the women around her(!), look and how that turned her/them into “someone you wouldn’t want to f*ck”! … And not one of the women protested. Not a peep except for a little giggle in agreement.

        Yes, we’ve come a long way in Scandinavia. Yes, we’ve come so much further than American women. But oh, do we still have a long way to go, sigh. And it depresses me to see how the crop of young, male stand-up “comedians” with their despicable never ending sexist “jokes” make their audience, not least the young women sorry to say, totally crack up with laughter. That’s really sad.

        • Wow. That is exactly what I mean!

          I think I put up with more when I was young, but I’m not sure why because I’ve always been a feminist. I just seem to get more radical (as if being equal in all things is radical!) and less tolerant with age.

        • you have just described several ways in which Scandinavian women seem to be way behind American women in terms of liberation. I can not imagine American women cracking up at sexist jokes. If some American male had made the same statement about an American icon in the feminist movement becoming sad and insignificant and someone you wouldn’t want to f*ck, he would have had his head handed to him over and over until he walked off the set. Even the women of the View who are border line lame brains half the time would have gang shamed a guy like that.
          Maybe men in Scandinavia are willing to vote for female leaders but only those they want to have sex with.

  4. About 12 to 15 years ago, pharmceutical companies discovered “consumer advertising” (prior to that they were just paying off doctors directly). I would love to see an analysis of the increase in consumer advertising spending in the past 10 years versus the declines in R&D budgets.

    Today, the TV and print media (is there still print media?) are chock-a-block full of consumer ads (including extra print pages for the mouse-type warnings).

    Wrong focus!!!

    • In old Soviet Union it was ITAR-TASS, here in the Big PX it’s any member of the print and broadcast media.

  5. OT about the demographics of OWS Oakland.

    Here’s an interesting photo of the crowd around Moore in front of the tent city. Lots of bald heads, white hair. No masks. Few dark beards, some white beards. Normal looking crowd.

    http://oaklandnorth.net/2011/10/28/filmmaker-michael-moore-rallies-occupy-oakland-crowd/moore-front/

    • This is what I typically see at Zuccotti as well. A lot of people of all shapes, sizes, ages and colors. It really is a mixed bag. I urge anyone who is lurking and who is wondering whether to attend an occupation to check it out. You *will* find someone your age and everyone is there to have a conversation.

    • unfortunately I think Michael Moore has become the kiss of death. Seeing as he is part of the 1 percent, the irony is, well, ironic.

  6. OT: A journalist’s request for comments from Hillary supporters.

    I’m picking up reports and suggestions here and there that many Clinton supporters have a nostalgia for the Clinton presidency that never was. And I have thought about that and wondered: What would or could she have done that Obama didn’t do, and what did Obama do that she wouldn’t or couldn’t do.
    Have any thoughts on that?

    From Tom.Brune at newsday com

    (Sorry if this goes through twice.)

    • Oh, I guess I shouldn’t trust my own memory of the Clinton years even if I lived through them and was old enough to vote.
      As for what she could have done differently, I would have to say, nothing. She did everything right and grew as a candidate as the primary season went on, She was widely admired by voters of both parties at the end because she realized what her candidacy meant and took it to heart.
      It wasn’t Hillary that lost. It was her own party that stabbed her in the back. Let’s stop blaming the vixtim and ask what the DNC might have done differently.
      I think the aspect of this question that annoys me the most is the presupposition that there is a class of people out there who we, the voters, have to convince before they support her. And I reject that argument. The voters spoke and they gave her their votes. The question I have is why those who insist on convincing decided to pay no attention to those voters and overrided their votes at the convention. We’re not the ones who need to provide the answers, THEY do. She should have gotten a legitimate roll call vote and a floor fight. The absence of those two things split the party.

      • I’m signal boosting Brune’s request, which was posted at Pumapac.org. I think he’s asking what we think Hillary would have done AS POTUS in these last two years.

        For example, I think POTUS Hillary would have pushed hard for a new HOLC. And for the new incarnation of Glass-Steagall. And insisted on a Lily Ledbetter with teeth. Etc.

        • She would have ended the conscience rule.
          She would have ended the Bush tax cuts.
          She would have pushed for a bigger stimulus bill. If nothing else, she would have started by asking for $2 trillion at the outset, underlining the seriousness of the situation and using her majorities in Congress more wisely. If they brought it down to $1.2 trillion, that would have been pretty good.
          She wouldn’t have wasted her bully public on stupid lunch time speeches and ribbon cutting ceremonies. Too much of a good thing is too much sometimes.
          She would have tabled the health care debate until the unemployment rate came down. She would have expanded SCHIP and Medicaid. She would have supplemented COBRA longer.
          Those are things I think she would have legitimately had a chance of doing successfully.
          Things she might have done:
          Following Merkel’s lead, she might have supplemented salaries to prevent layoffs. She might have instituted a program to knock full time workers in danger of layoff down to part time status, thus preserving technical and scientific infrastructure. She might have rolled out a new alphabet agency plan to put people to work putting in high speed Internet, solar panels and more public transportation. She could have used some of that money to keep public employees in their jobs.(she could have used some of the stimulus package funds for that). The tax revenue would have kept the deficit down.
          She would have paid attention to Sheila Bair, Christina Romer and Elizabeth warren. Heck, she might have appointed warren to the head of the agency she created. The upshot of this is that solving the financial crisis would have involved infusing money from the bottom up as well as top down, while dismantling dysfunctional banks.
          She might have asked for serious investigations of the baking industry.
          That’s off the top of my head. I don’t know if she would have gotten everything on her list but i suspect she wouldn’t have put everything on the table and would have been a much tougher negotiator. And she wouldn’t have squandered her first two years because, realistically, that’s all she could have counted on. That was a given- 2 years. You don’t waste two years with a Democratic majority in both houses. And yes, a lot of those Democrats are no better than Republicans but I think she would have used her built in mentor to figure out a way to put pressure on them. Passing the biggest stimulus possible would have been the absolute top of the priority list. Attacking it immediately, even before the inauguration drawing up plans, would have been job number one. If you didn’t do that as president in 2009, nothing else mattered. If that means people are mad at you in four years for a big deficit, well, so be it. But if you use your money well, there would be far fewer irate voters in four years.

        • she would not have hired the guy who said girls can’t do math, or the guy who called women in PA of being bitter knitters.

          • Yeah, I’m pretty sure you’re right about that, for a multitude of reasons.

          • I mixed two comments together there I think. I meant to say that she would not have hired Rahm Emanuel or Larry Summers. She thought NCLB was bad legislation and should be scrapped. She really supported choice, not fake supports it like Obama.
            She wouldn’t have had to have a BS photo op with the women on her staff to prove that she heard them and their concerns about sexism.
            Hillary is a policy wonk. Obama is NOT. She would not have had to sit back and hope people would come up with good ideas. She would know what needed to be done and would not be afraid to say so.

      • “Split the party…”

  7. RD, it’s my understanding that Jobs was actually a Republican in thought and action even though he didn’t identify himself that way. He outsourced production to China and wanted to do away with teachers’ unions. While I agree that there could be some positive changes to most union contracts, doing away with unions and outsourcing manufacturing to virtual slave societies is in no way admirable or good for America.

    I realize that Jobs was a brilliant inventor but there seems to be a movement afoot to almost deify him. What is that all about?

    As for the dream of Hillary as POTUS, there are few things that I can think of that would be as good for our country. I just don’t see her doing it. I loathe Obama and I think he’s next to worthless as a leader but I don’t hear him suggesting that women should be jailed for having an abortion and far too many GOP candidates are doing just that. As I see it, we’re just screwed.

    • I think the reason why apple fans deify him is because he understood what people wanted and was a brilliant designer. My house has nothing but apple products. I’ve had PCs and as Jobs would say, they’re pieces of crap. I’ve never liked the OS or their security flaws or the shoddy hardware. Shall I go on?
      But I differentiate between Jobs the insane,y great inventor and Jobs the man. He was a very flawed human being who learned over the years that he needed people to help him curb his more terrible behaviors. Working for Jobs sounds like it was a nightmare but it also had incredible rewards that went beyond the monetary ones. Working for him was intrinsically rewarding because he knew how to bring out the best in people and push them past what they thought they were capable of. Still, I probably would have been tempted to kill him.
      As for his political affiliations, he was most definitely a Democrat. No question of that. The difference between the way Jobs outsourced and most other corporations these days is that Jobs never would have ripped apart his research organization to make a quick buck. The Chinese have always had poor working conditions for their factory personnel. That is not meant to excuse them. They should adhere to international labor standards, if only we knew what those were and that the US actually advocated for them. But these type of factories predate Steve Jobs. Should he have been concerned? Yes. But I haven’t gotten to that part of the book. But I have to say that he was pretty brutal to his American workers when he was at apple the first time and at Pixar later. He laid off people without any grace at all and sometimes without any severance. He was awful. I’m assuming he ended his business years on a better note than he started.
      He was not a Demi god. He might have been a prophet. He was definitely an artist. But in the end, he was a profoundly flawed human being and I have to give him credit for letting Walter Isaacson tell his story without editorial control. That right there tells you that Jobs matured over time. What he allowed in his 50’s would have been unthinkable to him in his thirties.

      • I’ve worked in Silly Valley since the start of Apple. Jobs was putting his own money into NeXt and Pixar. He was paying all of the salaries. Employees knew very well that each of these companies was not succeeding and would collapse without more and more money out of Job’s own pocket, and his money was limited. There were a series of layoffs at Pixar that reflected the dire situation before Jobs made a pack with Disney to sell them the animation hardware/software. When Jobs convinced Disney to fund Toy Story, Pixar went in a completely different direction and by taking the company public right away, many became rich (and Jobs was paid back royally). A lot of the employees from the original company (animation hardware/software) might have been obsolete in that environment. At least they had several years beyond Lucas because Jobs did buy the company.

        Most people I’ve worked with know that even when the company is public and the source of payroll comes from a profit, jobs are not guaranteed. Layoffs are common. Getting severance is nice, but not guaranteed, even with large companies. People have always needed to be on the lookout for their next position if their current company is shaky, and have an emergency fund to supplement unemployment checks. I am happy to have the last two weeks I’ve worked covered. That doesn’t always happen. I’ve sometimes been forced to go months without pay, but I’ve usually been paid.

        As for manufacturing abroad, Jobs spent lots of his own money building a gorgeous, streamlined factory for NeXt and created a similar manufacturing plant when at Apple. He overdid them in terms of meeting his design needs. But the “workers” were mostly robots. These facilities were as expensively put together as an Apple Store. But manufacturing, other than prototypes, left the Valley decades ago as more and more companies crowded in, and more and more people came. It wasn’t a place to manufacture anymore. Too costly. So companies went to Singapore and out-of-state long before Apple did. The components were coming from various countries, as well.

        I heard Steve Jobs respond to a desire to return manufacturing here (in 2005 or so). He said that it would never come back to the Valley as it had, but because it was outsourced, Apple could hire more engineers. As soon as the Chinese government values its currency accurately, then other countries will have a chance to be competitive. I’m expecting gradual changes in terms of addressing Foxconn’s hold on manufacturing. Chinese labor must be cheaper than robots now. I hated it in India when the only mode of transportation devolved down to bicycle rickshaw, but tipped well. I was constantly told how much the rickshaw wallah appreciated having any work. Maybe some Chinese would prefer to assemble rather than to have the plants automated. I don’t know. When I was in China, I was shown factories with fake happy workers. The idea of living in the factories’ dorms was horrible. Made our corporate culture look pretty good by comparison.

    • You know, whether Hillary gets the nomination in 2012 depends a great deal on whether the Democrats feel they can win even if they have gobs of filthy lucre from the finance industry. If it looks like they can’t pull it off despite all that cash, I think they’ll call in a second string player. Maybe that means Obama will offer to not run. Maybe that means that Biden and Hillary duke it out in a primary. (I don’t see how you can get around Biden).
      Right now, I’m not sure the Democrats can pull this off. And the occupy movement could definitely put a kink in their plans because there are a lot of us who will not be coopted by the Democrats no matter how hard they try. I’m voting 3rd party, whether that means some already existing party or some offshoot of the occupy movement. Let’s see what happens. Things will move on the ground quickly if Democrats start to sense that they are in trouble. They just don’t believe it yet.

  8. They chase fads and trends. They rarely follow up on their initial enthusiasm to see if the fads actually add to their bottom lines. It’s the initial savings that they care about because that’s immediate, it’s quarterly and they think better in 3 month increments.

    And because much of their compensation is tied to stock price and they will have cashed out and moved on before things really go to hell. Some of them are certainly aware that they’re doing long-term damage, but they’re not being paid to worry about the long-term.

    They think research and innovation can be broken down to a list of mind numbing chores

    You must not have gotten the memo: human resources are fungible.

  9. “They rarely follow up on their initial enthusiasm to see if the fads actually add to their bottom lines. It’s the initial savings that they care about because that’s immediate, it’s quarterly and they think better in 3 month increments.”

    This is it. You have put your finger on the problem — on the reason why you are out of work.

    Speaking as a lefty, I don’t hate corporations — I hate corporations that think like THIS.

    It was only in the 1980s that the mania for maximizing shareholder value gripped American industry. This mania led to a lot of ruinous short-run thinking. Why? Because shareholders don’t CARE about the long run. They can buy and sell stock on a moment’s notice; they really don’t have much stake in a company’s long-term future.

    Jack Welch, the CEO of GE, was the one who ruthlessly pushed the idea of focusing only on shareholder value to the detriment of all other considerations. He started that crusade in 1981.

    More recently, Welch said that his mania for shareholder value was “the dumbest idea in the world.”

    Focusing only on the quarter can lead a company to do a lot of things that will destroy its own long-term viability. Over time, that sort of thinking can injure the viability of the nation — perhaps even of capitalism itself.

    You might improve the bottom line for the quarter if you institute ruthless outsourcing or layoffs or plant closings or whatever. But for a company to grow, it needs to invest massively in things that the shareholders, who can’t see beyond the quarter, may not like.

    You want to create a new Toyota — or a new Merck? You have to encourage long-term thinking.

    This is why I think the left MUST differentiate between finance capital and industrial capital. They are two separate animals. In other countries, companies depend on investment from banks owned by the state. (Often, the ownership is hidden behind a veil or two, but it is there.) That sort of funding can encourage a corporation to think beyond the quarter.

    Do I favor socialism? Not for industrial capitalism. But for finance capitalism — yeah, we need much more government involvement.

    • I predicted what is happening now, way back during the Reagan administration. I didn’t think it would take so long and I thought it would be peopled with more African Americans, since that is where the unemployment rate is the highest. I also thought the whole thing would be more angry and less patience. I was no economist or sociologist etc…. I just knew you could not go back to the days of serfs and lords without people finally rebelling. We are right now, a fascist state. The corporations own the government. The people have no real power.
      I remember the day it occurred to me that doctors worked for insurance companies instead of patients. It was around the same time I thought that if they kept moving jobs over seas there would few people left with jobs and income to buy their products and services.

  10. hope everyone is alright and still has power. 🙂

  11. hope you are ok.RD also hope this is alright.don’t want to get out of line.
    if this is not alright please delete. 🙂
    http://www.guardian.co.uk/weather/2011/oct/29/snow-storm-northeastern-united-states

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