We are now hearing about this concept all the time – that a company will take all the profits to hold privately, while pushing the costs and risks on to the public. In the old days, with asbestos, for instance, that meant denying the health problems being created while maximizing what the company could make right now. In many cases, this also meant going out of business before the black lung lawsuits began.
We now hear it about banks and hedge funds. And here’s a story I heard on NPR the other day, where all this was presented as a smart way of doing business and saving money for the company. Sounded to me like the reporter had not listened with wide open ears, or had not asked enough questions.
Right now, the US postal system is at real risk of collapse – correct? And yet the various private delivery companies are doing quite well – also correct? Guess what – Fed Ex takes the package across the country, and then, for that last and most expensive mile or two, it hands the package to the US Post Office, which actually delivers it.
Boots on the ground, expensive worker with good health insurance – not driving around hundreds of packages (which lowers the cost), but just hand-delivering one package. So Fed Ex has learned how to look smart, while gaming the system. We’re paying for that last mile, while Fed Ex has tucked away its profits. And its workers likely don’t have terrific health insurance, and maybe not even full-time jobs, so various labor law requirements don’t kick in.
Smart business – but bad news for our culture and our society. And not healthy capitalism. Short term profits, long term damage to all of us.