'Simple' Solutions Are a Slippery Slope
Edward Deming, a noted operations management expert, once observed that simple solutions, when applied to complex problems, don't work.
This principle has been brought to mind by too much recent commentary in The Pilot, which misses the fundamental point that multiple, interrelated factors have caused our current economic challenges.
Thomas Friedman, a respected journalist who has researched and written extensively on the trends in global economics, observed recently that the American economy faces "three huge structural problems that built up over several decades and have reached a point of criticality at the same time."
The first is a record-setting debt level that has been used to make payoffs - in the form of tax cuts and expanded entitlement programs - rather than investments that would support new economic growth, such as modernizing public infrastructure and promoting more research and development.
Second is the inability of our educational system to keep pace with the advances in technology that are restructuring the skills sets of jobs that pay a reasonable middle-class wage.
Last is the increasing innovation - and thus, greater market competitiveness - of an expanding number of other countries around the globe.
In sum, the American economy is becoming a broken business enterprise. Our plants and equipment are outdated, our workforce is inadequately trained in modern production methods, we are not well positioned in emerging markets, our infrastructure is inefficient, and we are close to exhausting our borrowing capacity, mostly to make dividend payments to our "stockholders."
To assume that we can rely solely on private enterprise to innovate our way out of this situation is myopic folly.
What is needed is a long-term view that expands horizons, requires sacrifices and supports a broad-based capability to innovate. Insular strategies like increasing tariffs and sending low-wage workers out of the country won't cut it.
Friedman cites Germany as an example of a country that in 10 years went from being the "sick man of Europe" to being the major force in the European economic community. This turnaround required the collaboration of business and labor to limit wage increases and allow worker flexibility, and the willingness of the government to subsidize firms to keep skilled workers on the job during the economic downturn.
Unfortunately, our political process is on the wrong track to meet this challenge. We are being told that we are overtaxed when the fact is we are underinvested. We treat our workers like the disposable foreign-made commodities we buy in our discount stores.
Rather than confront the structural causes of our declining economic -condition, which, as Friedman points out, have been mostly self-generated over a long period of time, we look for easy scapegoats and simplistic responses.
One unfortunate but consistent lesson of history is that tough economic times breed intolerance, which in turn often leads to despotism. If you think that the simplistic analyses and divisive, scapegoat solutions of self-promoters like Beck, Limbaugh and Palin will return us to prosperity, I say think again.
And recall how the excessive concentration of wealth and narcissistic, "live-for-today" behavior of the Roaring Twenties significantly contributed to the Great Depression; and how despots seized control of several European governments in the 1930s by playing on the fears of populations that were experiencing severe economic hardship.
These are bits of history that don't bear repeating.
Brian Deaton lives in Pinehurst.
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