Tuesday, December 25, 2012

Capitalizing On Christmas And Free Enterprise

"Our goal is to be a retailer with the ability to see opportunity on the horizon and have a clear path for capitalizing on it.  To do so, we are moving faster than ever before, employing more technology and concentrating our resources on those elements most important to our core customers."

Macy's Department Stores Mission Statement
Rowland Hussey Macy (1822-1877)

R.H. Macy accomplished a lot in a short 54 year life.  Leaving home at 15 to join a whaler company and sail the Atlantic Ocean, he worked there for four years.  During that time he acquired a large red star tattoo on his forearm.  That red star became the logo for his department store many years later.

Opening a "fancy dry goods" store in New York in 1858, his first-day sales totaled $11.08 (about $297 in today's dollars).  He plugged on however, with innovative policies like clearly marking prices (instead of haggling), and advertising those prices with lively and colorful newspaper ads.  His ads utilized set large-block letters, using marketing words and phrases over and over, and were instantly recognizable.  And he made history by hiring the first female executive for a major American retail store.

However, Macy had a lot to do with today's vibrant Christmas sales market.  He was the first to seize upon Santa as a way of selling goods, Christmas cards and wrapping paper.  He hit on this idea at the right time.  Nationally the Christmas tree was coming into vogue, as well as the recognition of Christmas as a religious and family holiday.

How did he capitalize on it?
  • He was the first to employ an in-store Santa in 1862.  Children came from all over to tell Santa their secret desires and Christmas toy wishes.
  • The country, and world, began to recognize Macy's as the instigator of the annual Christmas Parade.  This affair eventually morphed into the annual Thanksgiving Day Parade, which he used to kick off the Christmas buying season.  His parade was a marketing ploy for getting people to New York and to flock to his store at Christmas time.
  • Customers loved crowding outside his store to peer into the large, decorated windows, which advertised the latest in fashion, kitchen wares and toys.  His friend P.T. Barnum suggested he make them more elaborate by using moving figures to tell various Christmas stories.  The windows became the hit of the season, and a practice picked up on by many other retailers around the nation at Christmas time.
  • He began accepting mail order.

All in all, employing a capitalist spirit and shrewd business tactics (like mergers), the store eventually grew to be the largest department store in the world.  His short life left quite the legacy to the world of retailing success and free enterprise economics.

Tuesday, December 18, 2012

The Cancerous Disease Of Statism

"Statism is the disease that prescribes itself as the cure."

Barry Loberfeld

Pretty simply put!

What other thing is arrogant enough to wreck something and then claim to be the only entity that can fix it!  Our gubment does that all the time!

But, to understand the comment, STATISM must be defined.

Statism is essentially when the gubment becomes the most important thing in society - omniscient, omnipotent, and omnigood!

The philosopher Georg Hegel said that the state is "God walking on earth."  His thinking influenced the political thinking of another philosopher, one Karl Marx. 

While a Constitution places limits on gubment influence and activity, statism would do the opposite, removing such restrictions through lawmaking until the final stage of fascism or totalitarianism is reached.  THE GOAL OF STATISM IS 100% STATE!

It takes two forms, societal and economic.

Societal statism - there would be no "of, by and for the people" as sovereignty would rest in the state.  Individuals exist to contribute to the power and influence of the state.  "The people" would look to the state to provide what they typically and formerly would have provided for themselves.  Morality is found in service to the state.  This statist influence would extend into all aspects of the individual's life - education, health, finance, religion, housing, etc.  Statism, therefore, would refer to any state-sponsored political movement that advocates reliance upon the state to build the socialist society.

Economic statism - the state directs the economy, either through direct intervention with state-directed businesses (GM perhaps?), and state-sponsored organizations (Fannie Mae anyone?), or indirectly through economic planning (monetary and fiscal policy).  This intervention should be referred to as state socialism.  It only grows as the bureaucracy grows.  It's primary economic influence is THE BUREAUCRACY.  As it plans and implements its programs, even when the citizens resist (health "care"), at the same time it plans many new bureaucracies and hides many taxes that feed it.  Bureaucracy screws up and creates more bureaucracy to "fix" the screw ups!  The gubment spends to the point of extreme deficit and claims the necessity of additional "revenue enhancements" as the only cure, along with "cuts" in "future" rates of growth!  The vicious cycle only feeds the state. 

It slowly removes and incorporates more and more of the body that sustains it!

Support for the growth of the state, or statism, is more commonly found among liberals than among conservatives.  It was, after all, Ronald Reagan, who said the ten most frightening words in the English language are, "Hi, I'm from the gubment, and I'm here to help."

Surely unchecked growth is a cancerous disease that can only prescribe unchecked growth as the cure. Eventually all cancers reach the point of critical mass and the body can no longer survive its parasite.  And the body dies.  When in economic history has that not been the outcome?

It is impossible to cure any entrenched disease that is eating the body from the inside out.  Before it gets too large, or entrenched, the disease needs to be removed and the remaining cavity filled with newly-generated, healthy material.

THAT represents real change!

Tuesday, December 11, 2012

A Giant Immorality Portrayed As Truth

"We have enshrined a giant immorality as truth - that individual earnings belong to the collective rather than to those who produce them, and that we can in the name of the collective confiscate ever-larger portions of those earnings to advance our own individual lives and businesses in the form of pork, privileges, subsidies, loans, and entitlements."

Nelson Hultberg

Confiscate is a good word here.

But immorality?

Yes!  It is no less immoral to legislate thievery, in whatever form (taxes, surtaxes, fees, licensing, fines, you name it), than it is to put together a gang and rustle up some funds from people walking down the street!

Morality is defined by Oxford as

1.  concerned with the principles of right and wrong behavior and the goodness or badness of human character
2.  conforming to acceptable standards of behavior
3.  the extent to which an action is right or wrong

Morality comes from the Latin word "moralis," or 'custom.'  As a prefix "im" has variant spellings depending on the letter of the word it is modifying - it's other spellings are "in," "ir," and "il."  In any spelling variant the prefix means NOT, or THE OPPOSITE OF

IMmorality, therefore, means the opposite of morality.  And IMmoral means the opposite of moral.

Is it immoral or moral to pick a pocket?  Is it immoral or moral to rob a bank?  Is it immoral or moral to make anyone's successful financial outcome to a righteous risk or venture appear as shady and unfair?  Is it immoral or moral to legislate that more and more of someone's financial outcome to a righteous risk or venture be confiscated in the name of the rest of the group?

When did the rugged individualism that founded and grew this country and its principles into something exceptional get replaced by this idea that the "collective," to use Hultberg's word, and the collectives' wants, trumps the individual?  

And where has the country that extols collectivism developed into something exceptional and lead the world to new heights?

When did the expected entitlement supersede the right to the possession of one's private property?  And when did the right to the possession of one's private property become the expected entitlement of someone else?

Tuesday, December 4, 2012

Allocation Of Wealth

"In an unmolested market economy - where all dealings are consensual - the 'allocations' of wealth is the result of transactions."

Sheldon Richman

Shop owners are hoping for allocations of wealth.
Product manufacturers are hoping for allocations of wealth.
Entrepreneurs are hoping for allocations of wealth.
Any dealing in a free market economy happens when wealth is allocated!

How does wealth get allocated?  When people vote for our good or service.  They do so with normal transactions.

My Oxford dictionary defines "TRANSACTION" as this:
1.  an instance of buying or selling
2.  the action of conducting business
3.  an exchange or interaction between people

In a free-market economy, which Sheldon Richman calls "unmolested," trillions of transactions happen in the most efficient way possible - voluntarily!  They are each guided by an invisible hand, as it were, where each decision maker evaluates their individual transaction(s) and decides in a way that is most palatable and beneficial.

Most of the unmolested activity takes place between people who never meet however.

How can I say this?

If you are wearing a shirt with a button right now, how many people did it take to get that button onto your shirt before you made the final decision to transact business to acquire that shirt?

But, remember, you have to consider that button from start to finish.


And each individual in the inception, production and distribution of that button likely knew few others in the entire process.  But each was acting in his own best interest, allocating resources in the most efficient manner possible, engaging in transactions along the way, before the consumer finally voted for that shirt and make the ultimate transaction to purchase it.


That is the guts of a free market economy.  It is the interwoven, connected and unconnected, steps of a long journey to convert natural resources into a consumer product.


Wow, imagine how many people it required to produce that shirt!

That is a whole lot of allocation of resources engaged in trying to encourage the ultimate allocation of wealth in the pursuit of ... wait for it ... PROFIT.