Let’s say I’m an entrepreneur and you’re an investor. I’ve got a new company and I want to see if you’re interested in helping it expand. Like all companies, it has a revenue stream and it provides products and services to its customers. However, it also has some unusual business practices. Let me tell you about it.
The first thing to know about our company is that our income stream is incredibly consistent. Unlike most companies that may struggle to generate revenue, our strategy ensures that revenue will never be a problem. The reason is simple. While most companies try to get their customers to opt-in to buying their product, we just assume everyone consents to paying us and we take payments from them automatically. If people decide they don’t like the arrangement, they are more than welcome to opt-out, but they can only do so by moving far away.
Fortunately, most people don’t complain too much about paying us, and this is because of another unique strategy we have. While most companies have their prices clearly displayed and communicated, we like to be discrete about our prices so that people are not reminded of them too often. And since most people don’t take the time to understand all the ways we take their money, we’re able to avoid a lot of negative psychological association. The key is to make our products highly visible and localized while making the costs invisible and dispersed.
The guaranteed revenue stream is also really handy because it allows us to get away with things that most companies can’t do. In fact, practices that people would never tolerate in the private sector are commonplace in our organization. For example, we tell people up front that we’re going to use their money to fund things that they disagree with. You know, things like murder, kidnapping, and theft. Of course, we don’t usually talk about them so candidly because it doesn’t help us psychologically. Whenever we refer to these practices we call them by nice sounding names like national defense, peacekeeping, law enforcement, and expropriation.
Some people object to these and other practices, but they still support the company. The reason is that by some miracle we’ve managed to convince them that the problem is always about the current management and has nothing to do with the nature of the company. They think everything would be fine if only a different manager was put in charge.
Speaking of which, let me tell you how management works in our company. This part is also a little different from normal. Instead of hiring managers based on their competence, we choose them based on a popularity contest among people who have no expertise in policy or economics and no incentive to be informed about what they’re choosing. We don’t really care about a manager’s past performance, experience or education like other companies do. Most companies want to reserve managerial positions for experts, but we don’t think that’s always necessary. The main qualities we look for in a manager are the ability to sling mud at other potential managers, the ability to lie with a straight face, and the ability to dodge questions.
Another useful feature of the management system is that it’s really difficult to get rid of bad managers. As long as their promises are outlandish enough for the majority to vote for them, they can keep their position for four years in a row. They can’t be fired no matter how poor their performance is and they’re never held accountable for delivering on their promises. Even more, the only way to get rid of a bad manager is to convince the uninformed, non-expert voters that another manager candidate is better. That typically happens through a fancy process called a campaign, which is a special time for potential managers to tell people about how bad all the other potential managers are.
Did I mention that most of these voters are uninformed, biased, and hopelessly ignorant about how best to run a company?
Anyways, once the current manager has been determined, they are put in charge of all the systems we use to deliver our goods and services, which are always of the highest quality. In fact, our company believes so strongly in our ability to provide exceptional products that we use coercion to stop people from competing with us. We insist that we should be the sole provider of our products. Naturally, if we were a normal company this would be called a monopoly, but since that term has a negative connotation we try to avoid the label. Yes, it’s true that we shut down people who try to compete with us, and it’s true that we don’t allow people to unsubscribe from our service (they never really subscribed anyways), but we honestly feel that this power is justified. Further, since we know we are the best service providers that exist, we ensure that we control the most essential services in our society, like education, healthcare, infrastructure, and law enforcement.
We are also very distrustful of other organizations that might be getting any ideas from our strategy of being the sole provider of certain products. That’s why we often write anti-trust laws to tell other big organizations that they’re not allowed to be too big because it’s anti-competitive and they might take advantage of people by limiting their choices. I guess we’re hoping people don’t realize that our company is the single most glaring example of a big organization that restricts competition and limits consumer choice.
One of the nice things about having a customer base that is economically ignorant is that most people don’t realize how much we’re ripping them off. For example, people tend to be attracted to our services because they are “free” at the point of use. They get the impression that they are getting good value for their money so they ask to have the service expanded. Eventually, our company is the main organization providing that product, and people become dependant on us to continue providing it. More importantly, we slowly introduce the idea that regular companies could never provide the service as effectively as we do. Even though these services used to be offered at an affordable rate in the free market, people are convinced that it could never work.
This strategy is quite effective, but it depends on our ability to deliver good products that people can trust. And while we like to pretend that we are capable of delivering sufficient quality, quantity and cost-effectiveness in our services, the reality is that many of our systems are sorely inadequate. For most companies, poor products would lead to losses and they would eventually go out of business. But we are not like most companies. When our products show signs of failure or shortages, we automatically assume that the problem is due to a lack of funding, since it’s obviously impossible for us to operate inefficiently.
The great thing is that since we’ve already banned competition, people have no other companies to compare us to, so they simply take us at our word that the only way to fix a broken system is to pour even more money into the broken system. This philosophy stems from our commitment to mismanagement. In most companies, efficient branches are rewarded for economizing their resources, while branches that have high expenditures and poor performance are closed down or reorganized. But in our company, we encourage wasteful spenders by giving them even more money. And if a branch is so efficient that they fail to spend their funds, we make sure to punish them by shrinking their budget.
On the rare occasion that we acknowledge our services might be mildly inefficient, we insist that the reason is solely because the previous managers were incompetent, and that it has nothing to do with the lack of competition or distorted incentives or any other systemic deficiencies.
As far as macroeconomics goes we openly subscribe to the school of thought that still can’t explain why a broken window is bad for the economy. We also think cartels are a great idea but since that word also has negative connotations we call it supply management. We also believe in limiting consumer choice through tariffs, price-gouging laws, corporate welfare and a litany of regulations. Basically, we care about making sure people have as few options as possible.
We also enjoy spending copious amounts of other people’s money on big projects. These projects are typically chosen based on whether our not-so-expert manager thinks they will make him look good in front of the not-so-informed voters. Further, since our programs are designed to help us win the next election by appealing to special interest groups, no one ever needs to worry that this money could have been better spent by individuals on things they actually needed.
Finally, if anyone has any problems with how we operate, they are more than welcome to voice their objection or even file a lawsuit. We believe strongly in a fair and just society, which is why our rules are set up so that the final arbitrator in any dispute between us and someone else is an “independent” branch of our own company. Naturally, conflict of interest is never a problem.
So what do you say? Is this the kind of company you would like to see expanded? Is this the kind of business you would endorse and promote? Is this the sort of organization that should be given lots of power and responsibility?