I read recently where United Airlines was planning to initiate several routes to smaller cities in both the United States and Mexico. It is an attempt to boost its revenues by adding additional passenger miles to the totals. As almost everyone knows, United has been scurrying to find a reorganization plan and the money necessary to emerge from bankruptcy.
United's troubles have been blamed on a lot of things. First, there are the soaring fuel costs. Then, there's a decline in passenger volume because of the effects of 9/11. Also, there's the cost of feeding the union pension funds in accordance with their collective bargaining agreements and the huge salaries paid to seemingly tenured personnel. Finally, there's the top heavy structure of its executive suite.
All these problems and their proposed solution remind me of an old story about a couple of dull normal citizens who happened to own a pickup truck. One evening, over a few beers, they were talking about ways in which they could use this asset to become rich. One of them suggested that they drive south and buy a load of watermelons and return to sell them on a street corner in the big city.
They left home, and found a farmer willing to sell them his crop for cash—their total life savings. They paid a dollar and twenty-five cents for each of the juicy melons. They, they took the overnight drive back to their home town and found a heavily trafficked street corner. They posted their hand lettered signs offering the succulent melons for $1.25 each. Their inventory was gone in one day and they were elated.
When they settled down from their exciting venture and counted their cash, they realized they hadn't made any money. In fact, they lost money because they had to buy gas and pay for a night's lodging. The entrepreneurs scratched their heads when they realized their dilemma. Finally, one of them snapped his fingers. "I've got it figured out," he said, "Next time we have to get a bigger truck."
And that's the problem with the solutions that United has come up with. They, too, have decided to get a bigger truck by adding routes to smaller cities instead of consolidating their flights to major hubs and filling their planes with more passengers and fewer empty seats.
The same sort of problem exists within government. Instead of finding the root cause of problems that confront the City, the State and the Nation, we buy a bigger truck for ourselves by raising taxes, issuing more bonds and throwing money at the problems without any understanding of how or why they came to be.
This "bigger truck complex" is also endemic to big business. We see huge corporations buying competitive businesses. Somehow, old fashioned anti-trust laws don't seem to apply to them or the transactions into which they plunge with billions of dollars in borrowed cash. It would seem that when mega-corporation "A" spends its several billions, someone would look at the effect of the transaction on consumers.
It happens, too, when corporations want to pad their bottom lines. They outsource jobs to far off-shore havens of low cost labor and lay off thousands of local workers. Then, when people aren't able to afford their products because they can barely make ends meet with the minimum wage jobs they have been able to find, those same corporations look around to find the cause of their lagging sales volume. The answer, usually, is an increase in their advertising budget—or they reduce product quality so they can pad their profit margins (and the market price of their stock) and keep showing a profit in the face of falling unit volume.
But government seems too busy spending money to watch out for the little guys who actually support it. This has been the course of government for the past half century or more. Republican or Democrat makes no difference—it's the little guy who pays.
And so it seems we blithely go on our way. We want to get a bigger truck. At least the next one might be a hybrid in an attempt to save a little gas. |
