Sunday, March 28, 2010

Putting the Brakes on the Corporate Model

Syndicated columnist and Fox News commentator Cal Thomas wrote a provocative and surprising article that appeared March 3, 2010, in the Inland Valley Daily Bulletin. The headline reads "Toyota's troubles stem from choosing profit over quality," and Thomas unabashedly recommends embracing excellence over short-term profits.

It is a measure of how far removed this country is from the culture Thomas suggests that the new CEO of Xerox Corporation was quoted recently as saying that "growth" was her number one priority. Not quality copies. Not customer service. Not corporate citizenship. Not exemplary employee relations. Growth, pure and simple. (Sure, these things are not mutually exclusive. But neither are they 100% consistent. Sooner or later, secondary objectives give way to the more urgent, important priority.)

One of the reasons American corporations typically choose profit over all other (competing) objectives is that they are legally required to do so. That's right. Not long after the Supreme Court ruled in 1886 that corporations were entitled to protection under the Fourteenth Amendment, a judge decided in the case of Dodge v. Ford (and the principle has never been overturned) that "a business corporation is organized and carried on primarily for the profit of the stockholders." And what is it that American stockholders want? Dividends and a higher stock price, hopefully sooner rather than later. What produces these results? Profit.

How ironic (and unfortunate) it is that Toyota's massive current crisis was caused, by its own admission, by a switch from the traditional Japanese model of high quality to the Western desire for growth and profit.

Could it be that the speed control mechanisms on American corporations are malfunctioning, resulting in out-of-control self-interest and a consequent loss of quality and service?

Any ideas on how to apply the brakes? Well, for starters, we could repeal the law upon which Dodge v. Ford was based, or better yet require corporations to consider the public interest, as well as the shareholder interest, when making key strategic decisions.

I can hear the screams of the free market capitalists already!! But consider this: under the current system, too many corporations produce negative externalities (that's "bad stuff" like pollution and unsafe products, to you non-economists) because doing so produces higher profits for their shareholders (and not incidentally, bigger bonuses for the top executives). Extrapolate to the not-too-distant future, and this movement, unabated, will result in wealthy stockholders and the homeless alike wondering what happened to the quality of life. Poisoned air is an equal opportunity killer. Ironically, unsafe consumer products mostly kill the people with sufficient resources to buy them.

Sunday, March 21, 2010

Unemployment? Or Unwillingness to Pay for Services?

Once again the daily newspaper provides important policy information, if you read carefully and connect the dots.

On Wednesday, March 3 (2010), the Los Angeles Times carried a front page story describing the lack of quality control and discipline in the county probation department -- because there are "too many cases and not enough staff." As a consequence, juveniles under the department's supervision are almost undoubtedly being abused by sworn officers who should be disciplined or fired. And the situations are not trivial. One case that was resolved involved an officer convicted of having sex with three juveniles in confinement. Another case involved an officer directing five teenagers to beat another juvenile suspected of stealing her cell phone.

More front page news: You already know that Toyota is suspected of building cars with major electronic throttle design problems that result in unexpected and uncontrollable acceleration. Why didn't the National Highway Traffic Safety Administration take a more pro-active role in investigating the reports that started coming in seven years ago? There may be several reasons, including coziness between regulators and the industry allegedly being regulated and/or incompetence. However, depending on which report you believe, NHTSA has only two -- or five -- electrical engineers on staff, clearly not a sufficient number to investigate carefully and get to the bottom of a complex issue.

Los Angeles County Sheriff Lee Baca (according to an article on page AA3) is cutting his budget by $128 million over 16 months through reductions in overtime and reassignment of administrative personnel to field duties.

States all over the country are experiencing their worst financial crises since, well, maybe forever. Thousands of teachers are losing their jobs, as school districts run out of money.

In today's Los Angeles Times, we discover that approximately half of California residents eligible for food stamps don't get them. One of the problems: welfare offices cannot afford the staff members required to process the applicants. Lines sometimes stretch out the doors, and the telephone goes unanswered. Some applicants simply give up.

Meanwhile, millions of people look for work. No, they're not all trained to be police officers, probation officers, electrical engineers, or teachers. But many of them could be. And most of the rest are either qualified or COULD be qualified to perform tasks that provide society with useful -- even necessary -- services.

If we were willing to pay for these services, we'd get not only more effective government but lower unemployment. Not a bad combination.

Sunday, March 14, 2010

Education, Texas Style

I've written fiction -- but I wouldn't dare make up stuff like this.

According to the New York Times (3/11/10, page A18, and a follow-up article on 3/13/10), conservatives on the Texas board of education are re-writing the social services curriculum in a manner more to their liking.

Ralph Nader -- and presumably therefore the entire automobile safety and consumer protection movement that he initiated -- out! Never happened. Those doggone corporations -- icons of the free enterprise system that don't need any regulation -- would never build a vehicle they knew was unsafe -- would they?

Phyllis Schlafly -- vigorous opponent of the Equal Rights Amendment, who once described the United Nations as "a monument to foolish hopes, embarrassing compromises, betrayal of our servicemen, and a steady stream of insults to our nation" -- in!

Martin Luther King Jr. -- apparently he can stay. But references to race when describing how different groups have contributed to the national identity will be forbidden, so presumably the textbooks will not be allowed to say he was African-American. And General Stonewall Jackson will be included as a "role model for effective leadership." Yes, these conservatives have a dream!

A majority of the 15-member board of education wants to "highlight what they see as the Christian roots of the Constitution" -- you know, the document that refers to religion only twice: once in the First Amendment, establishing what has come to be known as the separation of church and state, and once in Article VI, stating that "no religious test shall ever be required as a qualification to any public office or public trust under the United States."

Oh, by the way, country and western music will be studied as a cultural movement. High school freshmen will probably be assigned the task of writing lyrics to twangy melodies -- when they're not studying about the Contract with America, the Heritage Foundation, the Moral Majority, and the National Rifle Association. Yes, they're all "in."

Since Texas buys a lot of textbooks, this modified curriculum may in fact impact the education of most or all public school students in the entire country.

Well, majority rules. I wonder if they'll tackle the math curriculum next. If they do, will 3 plus 4 be redefined to equal 6?

Saturday, March 6, 2010

Good News on Bullying

Every now and then the newspaper contains good news. Such was the case this past Thursday, March 4, when the Los Angeles Times carried an article with the headline "Fewer children bullied or beaten up" (page A16).

A study funded by the Justice Department (our tax dollars at work, in a useful way!) and published recently in the Archives of Pediatrics & Adolescent Medicine revealed a significant decrease in physical bullying of children between 2003 and 2008. Sociologist David Finkelhor, director of the University of New Hampshire's Crimes Against Children Research Center, cited as a cause the proliferation of school-based programs to combat bullying following the 1999 Columbine High School shootings.

I jumped on the Internet and quickly located that CACRC site -- a great source for anyone interested in additional background information. Among other things, I found a paper on school-based Victimization Prevention Programs (VPP), which detailed the conditions under which such efforts seem to demonstrate success. Among those conditions are: 1) intervention at young ages (if possible, before undesirable behaviors have a chance to develop); 2) active, systematic, and specific skills training; and 3) intensive programs exceeding 20 hours, repeated if possible over a multiple-year period. (Are you surprised by the latter? I'm not. We study English, math, history, etc. every year!) Lecture presentations alone, and the use of fear tactics, tend not to be successful.

It is difficult for me to contemplate anyone arguing that bullying is a useful or healthy activity. There may be some disagreement, however, about the philosophical justification and the logistical feasibility of including VPP in K-12 schools.

In regard to the former, it could be argued that schools are not the proper venue for "social engineering." This is the parents' function, some would say. Well, of course it is! But with 22% of children reporting bullying in 2003 -- and clearly many more subjected to the phenomenon but not reporting it -- maybe the parents need some help. (And some parents, victims of all kinds of negative childhood experiences themselves, are simply not equipped to provide positive role models.) School is a great equalizer, and it is the one social environment that practically every child experiences. Given the negative consequences of bullying on its victims, it seems a shame to me to pass up a proven opportunity to ameliorate a devastating and all-too-common behavior.

Can schools really implement such training effectively in an era when standardized tests have achieved near-deity status? Apparently some of them can, because they do! What's required is funding, teacher training, well-developed instructional modules, and a philosophy that values appropriate social behaviors as well as pure academic knowledge.

What are the consequences of not providing mature social learning environments for our children? Just observe the overgrown children who populate our legislative bodies!