Tag Archives: economics

Team Earth

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I really don’t understand.

I like to think that I’m a “citizen of the world.” To me, that means that I feel that I (and my country) should be a team player on Team Earth.

Team Earth is the team that works together for the benefit of our world. When we see a crisis looming — global warming comes to mind — we work together to try to prevent it. When we see drought in one part of the world causing mass starvation, we step in with funds and technology to help the victims. When we see genocide killing off huge ethic groups in a country or region, we take action against the murderers.

The players on Team Earth do what’s right for the world. They don’t do just what will benefit themselves, especially at the expense of others.

So I can’t understand it when I hear the comments of some Americans — especially those living the good life — when they talk about “bombing the hell” out of one country, stealing the oil of another country, and ignoring the serious problems of yet another country.

I can’t understand why people would rather set up oil rigs in a pristine wilderness to provide just 5% of our country’s current oil use in 2020 or beyond when they could be spending the same money developing alternative energy sources that don’t destroy the planet — or simply act responsibly to reduce their consumption of fossil fuels. (Do we really need to commute to work in vehicles like Hummers?”)

I can’t understand why people who have health plans (today) are so opposed to a universal health care system that would protect those who are less fortunate from financial ruin in the event of a catastrophic health problem.

I can’t understand why any American — other than a very wealthy one — would support a candidate who would give a taxpayer earning more than $2.9 million per year a $269,000 tax cut (on top of the tax cuts already handed out by G.W. Bush) while cutting the taxes of folks making less than $19K by less than $20 — all while the government is funding an expensive War in Iraq and bailing out financial institutions. (The numbers are summarized here, and here’s a video for those who struggle with tables of numbers.

I know I’m not the only player on Team Earth. But am I the only American player on the team?

Cutting Off Their Noses to Spite Their Faces

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I still can’t understand it.

The other day, one of my editors told me that the book I’m currently writing will be laid out in India. As a matter of fact, last year’s edition of the same book was also laid out in India.

She went on to tell me that the production department for the company had been downsized from 168 people to less than 20, with the majority of those jobs going to India.

What followed was a discussion of what the company could possibly be saving by making such a change. Sure, the Indian workforce is probably making a lot less per hour. And there’s a huge reduction in other payroll costs for things like vacation pay and health care and employer taxes.

But don’t they consider the cost to the U.S. Economy of putting 148+ people out of work? People who may not get jobs? People who may contribute to the home mortgage crisis by failing to pay their mortgages? Who may need to burden the country by requiring economic assistance to live and get healthcare? People who are a lot less likely to spend disposable income on things like books simply because they don’t have disposable income?

148 people, you say. That’s nothing. How is that going to affect the U.S. economy?

Well, it’s not just one company shipping jobs overseas. It’s hundreds or thousands of them. That equates to thousands of people out of work, many of whom may become unable to afford the goods or services offered by the companies that let them go.

How ironic. By acting in such an idiotic, short-sighted way, these companies are actually reducing their customer base. So while their costs are lower, their sales are likely to be lower, too. Net effect? Zero change in the bottom line!

When I was a kid, we called that “cutting off your nose to spite your face.” Wikipedia has this to say about this particular phrase: “Cutting off the nose to spite the face is an expression used to describe a needlessly self-destructive overreaction to a problem.” Although it usually refers to an act of revenge, I think it could apply to this situation, too.

How can companies reduce their bottom line without shipping jobs overseas? It’s pretty simple: use freelancers.

One of my other publishers has a very small in-house production staff. But it also utilizes a number of freelance production people all over the U.S. When the in-house staff is busy putting books together, it turns to its freelancers and assigns books to them. They get the job done right in a timely manner. They have to — if they don’t do the job satisfactorily, there’s another freelancer waiting in line behind them to do that job or the next one.

Freelancers might get a higher wage than in-house people, and they surely get a higher hourly wage than overseas workers, but they only get paid when they work. So you’re not paying them to hang around the office during slow spells, when there’s no work to do. And, if you pay by the job, rather than by the hour, you only pay for the work done — not time hanging around the water cooler or spending a few extra minutes at lunch.

Employers don’t have to pay taxes for contract labor like freelancers. They also don’t have to offer benefits like vacation time or healthcare. There’s no need to send them for training or to maintain a big human resources department to keep track of them.

And since many freelancers work from their homes, they’re not commuting to and from work. That means they don’t contribute to traffic, pollution, or greenhouse gases.

And since they do work and they do get paid, they have disposable income to buy consumer goods and services. (I’ve been freelance for 18 years now and I can assure you that I’m quite a consumer of goods.)

So my question is this: why don’t more companies explore the possibilities of using freelancers instead of shipping jobs overseas?

Comments? Use the Comments link or form for this post to share your thoughts.

Forms for Funding Airports

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Thoughts on FAA Form 1800-31.

On Saturday, I received FAA form 1800-31 in the mail. Titled “Airport Activity Survey (by Selected Air Carriers),” it’s headed up with the following description as part of its Paperwork Reduction Act notice:

Submission of this form is voluntary. The purpose of this collection is to capture passenger enplanement data to be used to allocate Federal funds to eligble airports. The public reporting burden for this collection of information is estimated to average 1 hour and 30 minutes per response.

The form requests me to enter the names, states, airports, and airport identifiers for all airports where I picked up passengers for on demand commercial operations. For each airport listed, I need to provide a count of the passengers I picked up.

To gather this information, I’ll need to go through my aircraft logs for 2007 and look at each flight conducted. If it was a revenue flight, I need to note where I picked up the passengers and how many passengers I picked up. I then need to tally these for each airport and summarize it on the form. Ninety minutes sounds about right for this chore.

Although this task is voluntary — frankly, I don’t think I bothered last year — I’m looking forward to doing it this year. It might be the bean counter in me — once an accountant, always an accountant. But there are two good reasons why it interests me more this year:

  • A line-by-line review of my log books helps me to remember individual flights. I’m in the process of drawing together material for a book about my flight experiences and I’m sure I’ll be reminded of a few flights that are interesting enough to write about.
  • I’m curious to learn which airports I did the most business at last year. I’m pretty damn sure it wasn’t Wickenburg. Hell, I picked up more passengers in Buckeye in one day than I did during a whole year at Wickenburg.

Not Wickenburg? you may ask. How can that be? Aren’t you based there?

Yes, I’m based at Wickenburg. But sadly, very little of my business originates here. The vast majority of my revenue comes from flights out of Deer Valley, Scottsdale, and Sky Harbor, with the big revenue charters originating in places like Page and Yuma. Try as I might to market my services here in Wickenburg, the population simply isn’t interested. I’m probably too costly for most of the fixed income folks who live here, while the folks who don’t worry about money would prefer a pickup from a turbine helicopter based in Scottsdale. (How’s that for ironic?)

I’ve actually gotten to the point where I don’t bother marketing much in Wickenburg anymore. Sure, my original tri-fold brochure is still out there. Why not? I have about 10,000 copies of it left. It emphasized my Wickenburg tours and, when I realized that my market was in the Phoenix area, I had it redesigned to emphasize tours from there. The leftover copies of the original are in my hangar, slowly making their way out into brochure racks around town.

And this year, I pulled the plug on my local Yellow Pages ad.

I’m even in the process of turning off my local phone number, preferring my cell phone for all communications with current and future clients.

Hermosa RanchIt’s odd, in a way. I’m the only aircraft charter operator based in Wickenburg. The town has a very nice little airport that recently got a bunch of funding from the Federal Government that added 1000 feet to its runway. But when finally given the opportunity to set up an office on airport property, I turned it down. I, like many other business owners (or potential business owners) here, have learned that dealing with the Town can be a nightmare of bullshit politics conducted by men who get their kicks controlling this insignificant corner of the world. They have no regard for the future of the airport — a fact they’ve made clear by allowing housing on three of the airport’s four sides, including less than 4000 feet from the approach end of Runway 23. Why would anyone in their right mind put up a building or hangar or anything else at an airport that’s likely to be closed in 10 or 15 years due to residential encroachment and the accompanying complaints? Or, for that matter, sign a land lease agreement that can be cancelled at any time on the whim of the Mayor or a Council member?

So my business languishing, as far as Wickenburg is concerned, but doing quite well everywhere else. And that’s unfortunate for Wickenburg. Not only is the Town losing out on sales tax revenue generated by my scenic tours, but FAA Form 1800-31 will not indicate Wickenburg as one of my major operating airports.

And if the only charter operator based in Wickenburg has more passenger operations at other airports, then how many passenger operations will be recorded for Wickenburg’s final tally? And how will that affect future airport funding?

I’m learning not to care.

Telecommuting: One Solution to Slow Global Warming

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And I don’t understand why no one sees it.

Later this morning, I’ll have the joy of joining thousands of other drivers on I-17 as we head southbound into Phoenix from points north. It’s a typical Monday morning, so I expect traffic to back up in the typical places — a few miles short of the Loop 101 intersection, down around Glendale Ave, at the “Stack” and “Mini-Stack,” at the Durango Curve, etc. The only thing that’ll make this trip to the airport tolerable for me is that my husband will be with me in the car and we can take advantage of the HOV lanes set up for carpoolers along part of the route. We’ll speed by the thousands of cars with only one driver in each one, getting to our destination in an almost normal amount of time while they take 50% longer to reach theirs.

Obviously, one of the best ways to slow global warming caused by auto emissions is to reduce auto emissions. You can do that by encouraging people to buy more fuel efficient cars, but you’ll always find people who need that status symbol Hummer or other ridiculous SUV in their driveway. (You know, the one with the shiny chrome extras that has never been off pavement?) You can do that by encouraging car pooling by adding HOV lanes to the highways. (You can see how well that works on the commute into Phoenix each day; ask the folks in New Jersey about their HOV lanes.) You can do that by encouraging people to live closer to where they work. (But with people changing jobs more often than most folks change hairstyles, that’s difficult to maintain.)

But you can also do that by implementing a solid plan for telecommuting — making it possible to work at home or in a local telecommuting center instead of making the long commute to park their butts in an office or cubicle for the day.

The Benefits of Telecommuting

The benefits of telecommuting go far beyond keeping single-driver cars off the roads during rush hour. For example:

  • Telecommuters spend less time traveling to and from work, so they have more time to spend with their families and friends. This can improve their lives and reduce stress.
  • Telecommuters can easily “pop back into the office” to get a bit of extra work done when necessary, especially if that office is in their own home or neighborhood.
  • Companies that allow telecommuting can reduce the amount of office space needed because fewer people will be coming to a central office. This can save the company money.
  • Companies that allow telecommuting can pay lower salaries because telecommuting employees have reduced commuting costs. (My sister, for example, spends more than $500 per month to get from her New Jersey home to her Broadway and Wall workplace, which is less than 20 miles away.) Savings can be spent on the equipment the employee needs to work away from the central office, such as a computer, Internet connection, and/or telephone line.

Clearly a telecommuting program can help a business and its employees, as well as the environment.

Not Always Possible

Obviously, telecommuting is not possible for all kinds of jobs. A car salesman, for example, can’t meet and greet prospective customers while sitting in his home-based office. Someone who works in manufacturing, where job duties require assembling parts or checking quality needs to be at the factory with tools and materials to get the job done. Policemen, firemen, and ambulance workers must be on the beat or at their base of operations, ready to spring into action when needed.

But there are so many jobs — especially in our predominately service economy — where an employee’s physical presence is not required at a specific workplace. Salespeople can do much of their work on the phone and in front of a computer, with visits to customers and clients to close a deal or provide service. Customer service personnel can work from any location where they have access to a telephone and the Internet. (If we can ship these jobs out to India, why can’t we ship them to people’s homes or telecommuting centers in the suburbs?) Editors, writers, and production people don’t need to come to an office to get things done. As long as they have the tools to work, they can work.

And telecommuting doesn’t need to be an all-or-nothing proposition. An employee can work in a main office two or three days a week and work the remaining days at a home office or telecommuting center. He can share an in-office workspace (cubicle or office) at the workplace with another telecommuter on the opposite schedule. Just taking one day a week off a person’s commute — that’s 20% fewer miles driven — can make a world of difference.

The Mindset

Unfortunately, the mindset of employers and employees makes utilizing a telecommuting program difficult, if not impossible.

Many employers have a complete distrust for their employees. They feel that if they’re not looking over an employee’s shoulders, the employee must be goofing off.

While that might be true of some employees, it isn’t true for everyone. Many employees are responsible individuals who understand that they’re being paid to get a job done. It’s those people who should be given the opportunity to telecommute.

The way I see it, telecommuting is a lot like working freelance, but for one client: your employer. If your employer gives you a job to do and it can be done in the amount of time allotted, there’s no reason why you shouldn’t be able to do it, whether you’re at a centralized workplace or at home with the necessary tools.

If an employee cannot finish a job at the office, he should not be given the opportunity to telecommute. Instead, the employer needs to understand why the employee is falling short of goals. Are the goals unrealistic? Is the employee simply not up to the task? This needs to be established before telecommuting is offered to anyone.

Employers can get peace of mind about telecommuting by granting telecommuting privileges only to proven employees and then monitoring workflow to ensure goals are met.

For example, suppose a support staff member is expected to handle 30 support calls in a day. If given all the right tools at a remote workplace, he should still be able to handle 30 calls. If his output drops to a consistent average of 20 calls a day, this should set up a flag for the employee’s manager. Why has the output dropped? Are there additional tools the employee needs? Or is he wandering away from his desk to chat with neighbors or do errands?

Output will always tell the story and that’s what should be used to evaluate the success of a telecommuting program or a specific employee’s participation in one.

I also think that while in some businesses, telecommuting can be used as a reward for hard-working employees, in other businesses, it can be the way to do business.

After all, why do employers pay employees? To spend a certain number of hours sitting at a certain desk in a certain place? Or to get a job done?

Conclusion

These are my thoughts about something that has been on my mind for years now. My ideas are a bit disjointed and perhaps idealistic. But two of my three primary editors are full time employees for publishers who allow them to telecommute. One editor lives and works more than 1000 miles away from her main office. Both editors are able to get all of their work done in home-based offices. While this is just one example of telecommuting in action — editors in the publishing industry — there can and should be more.

Telecommuting can solve so many problems. Why don’t more employers consider it?

Donating Ideas

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A few thoughts about yet another new “charity” effort.

A fellow twitterer — and I won’t mention names because my purpose is not to embarrass him — has created a Web site designed to gather “idea donations.” That’s right: the goal is to gather business ideas for people who are evidently incapable of coming up with their own ideas. These mentally challenged people can then use the donated ideas to start businesses and improve their villages, towns, or personal lives.

I have a serious problem with this.

It isn’t enough for successful business people to donate money and equipment and finance small business owners who need help. Now we have to think for them, too?

The way I see it, if an “entrepreneur” isn’t bright enough to come up with his own business idea, he’s probably not going to be bright enough to make someone else’s idea work, either. It takes a lot more than a packaged idea to start and build a business. It takes brains, know-how, experience, hard work, funding, imagination, moral support….get the idea?

Am I missing something here? What’s the point of this? To make people who can think feel all warm and cuddly for handing out ideas to people who can’t think?

If someone doesn’t have enough imagination and know-how to come up with his own business idea, he should probably stick to work that doesn’t require so much brain power — and leave the business of starting and running new businesses to those better able to get the job done.