How Can We Have a Healthy Economy and Healthy Ecosystem?

Euphoric Purpose Inspires Democracy

Joel Salatin is the owner of Polyface Farm in Shenandoah Valley, Virginia

Merry Christmas and Happy Holidays

"Power, no matter how well-intentioned, tends to cause suffering. Love, being vulnerable, absorbs it. In a point of convergence on a hill called Calvary, God renounced the one for the sake of the other." -- Philip Yancey

"I Think in Ten Years Time We Will Look Back and Say, 'We Should Not Have Done That.'"

People Before Profits

"For the first 100 years after the founding of our country, no corporation was allowed to get a charter unless it could prove that it served the public interest, and charters came up for renewall every ten years or so; they didn't get a renewall unless they could prove that they served the public interest. That all changed after the supreme court ruling that made corporations equal to individuals in the late 1880's, and then, John D. Rockefeller stepped in and really made things get out of hand. We need to go back to an understanding that corporations are there to serve us." -- John Perkins (author of Confessions of An Economic Hit Man)

US Has the 20th Most Free Press

First Amendment - "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances." Why is the United States number 20 on the list of countries with the greatest freedom of the press?

Is it any wonder that the nations (Denmark, Finland, Ireland, Norway, Sweden, Estonia, Netherlands, Switzerland, Iceland, and Lithuania) with the most freedom of the press tend to have the least corruption and the highest standard of living. Anyone who understands the principles of democracy should not be surprised.

The best medicine for corruption is a little sunlight.

(Read article and see rankings @ http://www.rsf.org/en-classement1003-2009.html)

As Foreclosures Hit All-Time High, Wall Street on Pace to Hand Out Record $140B in Employee Bonuses

Finance is supposed to exist for one purpose: to make the real economy work better. The fact that the DOW Jones has topped 10,000 and banks are doling out record employee compensations, while foreclosures are at record highs and unempoloyment is expected to top 10% is further proof that the real economy and the finance world have come unhinged.

How can the finance world make tons of money off of an economy in crisis?
By removing import legislation over the last decade that allows Wall Street & banks to grow like crazy, deliberately make bad loans with high interest, and to do it with other peoples' money. With that kind of a formula you are guaranteed to report record profits--not by creating anything of value, but by taking billions out of the real economy in trading profits.

Bailout for Bankers

"The average tax payer in this country, that's people making less that $75,000, should take a bow because every dollar in income tax they pay for four years went to this bailout." -- Donald Barlett of Vanity Fair

Big Government Means Big Business

In general, federal regulation benefits big business, and local regulation favors small business. Small businesses offer greater freedom and prosperity. Big business stiffles freedom, competition, and prosperity. You can be assured that big business will get bigger unless regulating power is decentralized to local governments. Here are two examples of the Big Government/Big Business effect:

Banks at Risk of Failure Has Reached 15-Year High
Banking regulators are warning that the number of banks at risk of failure has reached a fifteen-year high. The Federal Deposit Insurance Corporation said the number of “problem banks” had risen from 305 to 416 during the second quarter. The FDIC has already shut down eighty-one banks this year. This comes at a time when the nation’s largest banks are getting even bigger due to a series of federally arranged mergers and taxpayer bailouts. JPMorgan Chase, Bank of America, Wells Fargo, and Citigroup now issue one of every two mortgages and about two of every three credit cards. JPMorgan Chase, Bank of America and Wells Fargo now each hold more than ten percent of the nation’s deposits, despite a rule barring such a practice.

Taxpayers to Pay Banks Billions to Fix Loan Mess: A new report by the Center for Public Integrity has found that any of the lenders that helped fuel the housing crisis by issuing risky subprime loans are now lining up to receive more than $21 billion in taxpayer money intended to help bail out borrowers. At least twenty-one out of the top twenty-five participants in the Making Home Affordable program specialized in servicing or originating subprime loans.
(Examples taken from DemocracyNow!)

Maximizing Profits is not the Purpose of Business

Is the purpose of a doctor to maximize profits? Is the purpose of a teacher to maximize profits? Then why do we mistakenly believe that the purpose of business is to maximize profits?

Principle or Expediency

The only difference between a multi-national corporation and an oligarchical government is that one has an army and the other does not. With this perspective, it is easy to see that centralized power of any kind is prejudicial to human liberty. Corporate executives have the same incentives as politicians. If a politician or an executive must choose between principle and keeping her job, she will nearly always choose to keep her job.

For example, the prankster, Andy Bichlbaum, posed as Jude Finisterra, a Dow Chemical spokesperson, to speak about the deadly gas leak at a chemical plant in Bhopal, India that has now killed an estimated 25,000 people and injured another 120,000. He announced that Dow will accept full responsibility for the Bhopal Disaster and will pay $12 Billion for the health coverage of these 120,000 people.

Within a half hour, DOW Chemical's stock dropped $2 Billion until the company announced that, "Jude Finisterra is not an employee nor a spokesperson for DOW Chemical." To this day, the company has not accepted responsibility for its actions in Bhopal, India.

The Federal Reserve: The Undemocratic Branch of Government

Democracy is More Cumbersome than Dictatorship

Semco went through a radical, democratic transformation beginning in 1980. In 1980, Semco employees "each produced an average of $10,800 worth of goods a year." When Ricardo Semler wrote Maverick in 1993, his employees each produced an average of "$92,000 worth of goods a year (adjusted for inflation)--four times the national average; by the value-added standard, productivity rose six and a half times."

If democratic businesses are more profitable and motivating, then why do people insist on creating oligarchical/command-control organizations? Because...
(1) "so often it is power and greed and plain stubbornness that make bigger automatically seem better."
(2) "secrecy is a strong incentive to be conspicuously greedy."
(3) "bureaucracies are built by and for people who busy themselves proving they are necessary, especially when they are not."

"The era of using people as production tools is coming to an end. Participation is infinitely more complex to practice than conventional corporate unilateralsm, just as democracy is much more cumbersome than dictatorship."

(Quotes taken from Maverick by Ricardo Semler)

Democratic Healthcare! Why didn't I Think of That?

"Senator Max Baucus of Montana, the chairman of the Finance Committee, who is leading an effort to draft a healthcare bill, said Thursday the public plan would take the form of an insurance cooperative that would be owned and operated for the benefit of its members, but not run by the government. The Senate finance panel plans to take up the legislation on June 23rd."

President Obama's "uniquely American" version of public healthcare maintains the motivating pressures of the free market, while eliminating the choking costs of high paid executives and excessive profit margins. If this insurance cooperative is set up as a true cooperative and not as another arm of government, we may witness the greatest victory of the Democratic Business Revolution to date.

Next, we need to democratize Amtrak. What would it be like if the people who work for and ride Amtrak were to own and manage Amtrak?

(Quoted from DemocracyNow! 6/12/09)

The U.S. is Not a True Democracy

"Give me a word, any word, and I show you that the root of that word is Greek." (Gus Portokalos from My Big Fat Greek Wedding)

How about Democracy?

'Democracy, democracy, democracy. Ha! Of course! Democracy is come from the Greek word demos, is mean people and from the Greek word kratos, is mean rule. So, who rules in a democracy? The people. You see: people, democracy. There you go!' (Gus Portokalos)

If democracy is rule by the people, the U.S. is not a democracy: (1) Democracies do not maintain favored citizens. Favored citizens are citizens with greater political sway or power than others. Equal political power is impossible to maintain in large communities. Only small communities can possibly maintain equal political power for its citizens. (2) Democracies de-centralize power. Never in the history of the U.S. has power been more centralized. The Federal government has power over our food, currency, energy, land, civil liberties, businesses, etc.
The solution is to create true democracy. The federal government needs to de-centralize all power not granted to it in The Constitution and give that power to the cities of the U.S. If a community is too large to be ruled as a direct democracy, then it is too large to maintain political equality.

Argentina: Capitol of Worker-Run Businesses

More than 75,000 people work in worker-run businesses in Argentina, and that number increases every year.

What Does God Think of Money?

If you want to know what God thinks of money, look at who he gives it to.

Transparency and Limited Power Stop Corruption

"The Church committee (named for Senator Frank Church) looked at a period starting with Franklin Roosevelt and running through Richard Nixon...In every single administration you had failures of control by all the presidents and misconduct by the intelligence agencies...Under all the administrations—six different administrations, both Republican and Democrat—there were misuses of power...(that were) inconsistent with the law and the Constitution.

"The single most important finding of the Church committee was that, if during a time of crisis we ignore the wise restraints that have been put in our constitution and laws to keep us free and keep us strong, we are not only going to make ourselves less free, we are going to make ourselves less safe.

"We’ve slipped as a country into not being as open as we historically (have been) and instead into more and more secrecy, and I think that is one of the underlying root causes (of corruption) that needs to be examined and dealt with." -- Frederick A.O. Schwarz, Jr. (Chief Counsel to the Church Committee)

"Deepest Global Recession Since the Great Depression"

The International Monetary Fund is forecasting the global economy will decline this year for the first time since the Second World War. On Wednesday, the IMF said the global economy would see a 1.3 percent decline in what it called “by far the deepest global recession since the Great Depression.”

(Quote taken from DemocracyNow!)

A Business that is Run Like a City

"Most of the forces that shape the structure of business, including capital markets, business schools, economic theory, a variety of laws, and even our own upbringing trains us to assume that at work you're either an employee or a boss, but never a citizen. So at Equal Exchange we understand why workplace democracy seems such a novel concept. We simply don't accept it." --Equal Exchange President Rob Everts

Equal Exchange is a 23 year-old, $34 million employee-owned firm that is run like a small city where employees act as citizens and the employee-elected Board acts like a City Council.

Bribery is a $1 Trillion Dollar Industry

Daniel Kaufmann, the institute director of Governance at the World Bank, estimates that $1 Trillion of bribes are paid worldwide in both rich and developing countries; One out of every 30 dollars in the world is spent as a bribe.

The World Bank's research "shows that countries which tackle corruption and improve their rule of law can increase their national incomes by as much as four times in the long term, and child mortality can fall as much as 75 percent."

Interestingly enough, the most effective tool to fight corruption has been identified by the World Bank as transparency; ee.gg., freedom of the press, freedom of information, and asset disclosure.

Democratic businesses have found, like the World Bank, that being proactively transparent with all financial information fights corruption, creates efficiency, unity, & understanding, and causes employees to be paid for what they are worth and not for the amount that companies can acquire them for.

Now, if only we could force the World Bank to be transparent...

If you want to help democratize the world, and increase corporate transparency, visit http://www.glassdoor.com/index.htm, enter your salary, and browse the salaries of others within your company and around the world.

(Quotation taken from http://web.worldbank.org/external/default/main?theSitePK=84266&contentMDK=64069844&menuPK=116730&pagePK=64148989&piPK=64148984)

Voters Champion Free Market But Want More Regulation

The American people intuitively know that there is something wrong with American capitalism, but they can't quite put their finger on it.

Rasmussen Reports released a seemingly contradictory report on December 29, 2008--just after the economic crisis began. It seems that 70% of voters believe that a free market is better than one managed by the government; yet, 52% of voters believe that there is a need for more government regulation of big business. However, 65% agree that government and big business often work together in ways that hurt consumers and investors.

Intuition has brought the American people this far, but what are the facts. Nationalization is not democratic because government control is simply a new layer of management on top of the excessive, burdensome layers that already exist.

The way to maintain free markets and regulate corporations at the same time is to truly democratize corporations. Corporations that practice financial transparency, have few layers of management, and offer stock-ownership to all employees are held accountable by the employees themselves and have very little need for government oversight.

(Statistics taken from http://www.rasmussenreports.com/public_content/business/general_business/voters_champion_free_market_but_want_more_regulation)

Do We Love Freedom as Much as our Founders?

90 Million People Will Die as the Result of an Economic Collapse

The world is on the edge of a economic collapse because of the lack of integrity of a few in our businesses. "A new report from the Overseas Development Institute said the collapse of the global economy would cost 90 million lives, lead to an increase to nearly a billion in the number of people going hungry, and cost developing countries $750 billion in lost growth."

In a world where corporations are given the power to determine the fate of billions of lives, is it not only logical that this power be in the hands of the majority that work in these businesses and not in the hands of a few executives.

(Quote taken from DemocracyNow.org)

Bailout Firms Owe $220M in Unpaid Federal Taxes

"A congressional probe has found the top thirteen firms to receive bailout money owe more than $220 million in unpaid federal taxes. Congress member John Lewis of Georgia, the chair of the House Ways and Means Subcommittee on Oversight, says two of the companies owe more than $100 million apiece. The review only looked at the top twenty-three bailout recipients, leaving open the possibility of further owed taxes from nearly 450 remaining companies. The inspector general overseeing the federal bailout says he will investigate whether recipient companies misled Congress on their tax obligations."

Democratic businesses are proactively transparent with their financial information.

(Quote taken from DemocracyNow.org)

Politics & Democratic Business

If you ran the government like a democratic business, who would be correct? Conservatives or Liberals?

(1) Conservatives are correct that regulation is bad. It stifles progress, blocks creativity, hinders adaptation, and humiliates the majority that do the right thing.
(2) Liberals are correct that all centralized power should be regulated and limited by the people whos lives it impacts; ee.gg., banks and depositors, corporations and workers.
(3) Conservatives are correct that "government which governs least governs best" -- Ronald Reagan.
(2) Liberals are correct that workers make better decisions about business than their managers.
(3) Conservatives are correct that the disintegration of morals destroys every great nation. A study published last week shows that a record percentage of American high schoolers cheat. So much for putting political corruption behind us.
(4) Liberals are correct that direct democracy does not cause the poor to steal from the rich. When each person has equal political power, the poor do not care to steal from the rich and the rich are not able to steal from the poor. Which brings me to my next point...
(5) Conservatives are correct that redistributing wealth does not benefit the whole. The Soviet Union and Cuba have taught us this lesson.
(6) Liberals are correct that socialization--if it is at the local level--encourages progress; ee.gg., education, fire department, and health care. When people support their communities, the community supports the people.

14 of Fortune's 100 Best Companies Are Employee Owned

14 of Fortune's 100 Best Companies to Work For are employee owned companies. This is especially impressive when we note that employee owned companies comprise only one percent of the total businesses in the United States.

The greatest obstacle to productivity is disunity. Many managerial layers, unions, and command-control decision making lead to disunity. Employee ownership, however, encourages employee participation, unity, and ultimately productivity.

Athenians Would Laugh at America's Claim to Democracy

To Athenians, an essential feature of democracy was the direct and full sovereignty of the majority of citizens. Appointment to important offices, a two-party system, unelected bureaucracies, a private federal bank, lobbying, judicial life tenure, terms for elective office of more than one year—all these would have seemed clear and deadly enemies of a sustainable democracy.

The prospect that someone could make a life-long career of politics was and is contrary to the principles of democracy. The Athenian belief that political freedom and power was the right of every male citizen created an unparalleled level of stability in the Greek world. The Athenian democracy survived two occupations, constant wars, maintained peace between the poor and rich, and only one Athenian politician was ever assassinated.

The Power of Stories: We Were Made to Be Free Cont.

Stories have the power to guide companies, organizations, and people to elevated levels of engagement. Here is a story that engages me to fight for democratic workplaces:

"Three stone cutters were asked about their jobs. The first said he was paid to cut stones. The second replied that he used special techniques to shape stones in an exceptional way, and proceeded to demonstrate his skills. The third stone cutter just smiled and said: "I build cathedrals."

How much more happy, and productive would our companies be if we made it our first priority to engaged people in a euphoric purpose.

(Quote taken from Ricardo Semler in the book Maverick)

"...We Will See the Day When We Live on What We Produce" -- Marion G. Romney

Every year, Americans import $731.214 billion of goods more than they export. If foreign trade stopped, we would be forced to consume less than half of what we currently consume. This is the root cause of our current "economic" problems.

In order to buy almost 60 percent more than we produce, we have accepted loan after loan from foreigners. Currently 45 to 50 percent of our federal debt held by the public (the debt issued to fund annual, federal deficits) is owned by foreigners. 70 percent of all our new debt is being purchased by foreigners. This is the equivalent of mortgaging a cow to a stranger to buy more milk.

What is the solution to our problem? Stop mortgaging the American cow, and drink less milk. It appears that foreigners will force us to do just that. For the first time, foreigners are curbing their appetite for American IOUs, and soon, we will be forced to consume what we produce and pay down our $56 trillion mortgage for many years to come.

(Statistics taken from government websites and former U.S. Comptroller David Walker)

Our Current Economic Problems Are Only the Tip of the Iceberg

A Company that Let's Employees Choose their Own Pay?

How do you turn a near bankrupt company around and make it one of the fastest growing companies in the country? How do you create one of Microsoft's "best schools in the world"?

The answer is high expectations and near unadulterated freedom (ee.gg., allow employees to choose their own pay, and allow children to choose whether or not they attend school)

Watch this clip and be AMAZED!
http://www.youtube.com/watch?v=gG3HPX0D2mU

We Should Learn about Democracy from the Chinese

There is very little authoritative difference between a government and a bank. To understand that all centralized power is dangerous and should be democratized is to understand that centralized economic power (like political power) must be democratized and must serve the entrepreneurs that create wealth.

In the same way that the Federal government and State governments are supposed to serve the people, the Federal Reserve, local banks, and Wall Street must serve entrepreneurs. The benefit of these institutions is to provide funding and diversify the risk to entrepreneurs. Arguing that free market policy should apply to Wall Street, the Federal Reserve, and local banks is as silly as saying that the Federal Government should be free to make it's own rules.

The best, current example of a democratic economy is the Chinese economy. While the Chinese are politically oppressed, their democratic economy is inspiring entrepreneurs and creating the fastest, sustainable economic growth ever seen. Maybe we can learn a thing or two about democracy from the Chinese.

Democracy & Valentine's Day

I know it is a stretch to find a link between democracy and Valentine's day. I decided I wanted to write a post about my wife and I needed a justification for putting it on a blog about democratic business--so bare with me while I attempt to link the two:

My wife is a lot of the reason I have an optimistic outlook on life. Spending time with her makes me realize that even though an oligarchical Wall Street is destroying our economy and will make a profit at the expense of individual rights, there is a lot of reason to have hope in humanity.

I have learned, from my wife, how important it is to nurture the goodness in people. I see her with our son and it is all too obvious to me how much greater this world would be if more women were given the voice they deserve.

My wife has taught me the importance of the democratic principle of keeping my sights fixed on a euphoric purpose. We have so much fun together. I can't think of a day of our marriage when we haven't laughed together at least once. Our common goals and ambitions inspire me to making our marriage great and not simply good.

Being married to my wife has taught me that the principles of democracy (i.e., transparency, limited power, ownership, and euphoric purpose) are just as important to every aspect of life as they are to government.

The Power of Stories: We Were Made to Be Free

Stories have the power to guide companies, organizations, and people to elevated levels of engagement. Here is the number one story that engages me to fight for freedom and democracy:

"That Satan...is the same which was from the beginning, and he came before me, saying—Behold, here am I, send me, I will be thy son, and I will redeem all mankind, that one soul shall not be lost, and surely I will do it; wherefore give me thine honor.

But, behold, my Beloved Son...said unto me—Father, thy will be done, and the glory be thine forever.

Wherefore, because that Satan rebelled against me, and sought to destroy the agency of man, which I, the Lord God, had given him...I caused that he should be cast down;

And he became Satan, yea, even the devil, the father of all lies, to deceive and to blind men, and to lead them captive at his will..." (Moses 4:1-4)

High-Engaged Workers Are 7 Times More Profitable Than Low-Engaged Workers

In 2006, Gallup estimated that disengaged employees cost the American economy $350 billion per year. A study done by Kenexa Research Institute found that of 4,000 worldwide companies, the top 25 engaged workplaces outperformed the 25 lowest engaged businesses 7-to-1--based on shareholder return, on a five-year basis.

If engaging employees is the driver of productivity, what can a company do to engage its workers? Kenexa Research Institute suggests that there are four main drivers that help create engagement in the workplace:

(1) "Leaders who inspire confidence in the future of the organization."
(2) "Managers who respect and recognize employees."
(3) "Employees are inspired and engaged by exciting work that they know how to do."
(4) "Employees are inspired by organizations that demonstrate genuine responsibility to two critical stakeholders groups: employees and communities."

It may seem counterintuitive that putting engagement above productivity leads to greater productivity until you realize that engagement is what creates productivity. Maybe the answer to our economic crisis is not to create more money, but to engage the American workforce.

(Information from http://www.kenexa.com/getattachment/8c36e336-3935-4406-8b7b-777f1afaa57d/The-Impact-of-Employee-Engagement.aspx)

Glenn Beck: "This Is Real Trouble...Perhaps In The Next Year"

David M. Walker: A Voice of Warning to American Democracy (2007)

Surviving on 3 Months Wages in 2009 and 2010

Glenn Beck reported on 1/21/2009 that the Treasury has increased the money supply by 70 per cent since October.

"I talked to Steven Moore at the Wall Street Journal and he talked to the Treasury. It looks like we have increased the money supply by 70% since October. They're running these presses 24 hours a day. The effects of this, you're saying, will destroy the currency, so then, what happens?"

So then, what does happen to you and I? When this newly printed money trickles down to you and I (probably by 2010), the $50,000 salary you made last year, and that you make this year, will each be worth only $29,412. That is the same as the government taxing you 41% or $20,588 two years in a row and taxing all of your savings. No matter how much you made in 2008 and make in 2009, you will give all the money you made and make, from January to mid-September 2008 and 2009, to the government. This does not even include the cost to you of the $1.9 trillion in bailouts.

How does the government expect you and I and our businesses to survive in 2009 and 2010 on three and a half months of wages? How much more will the Treasury increase the money supply? How can the government take our money to restore the banking system without destroying the rest of us? Who will bail out the rest of us?

April 29, 2007

My Ideal Company

My ideal company would have...

(1) a media department to help employees focus on the euphoric purpose of the company and to maintain transparency in the company
(2) the option of employee ownership
(3) one optional, paid hour per day allocated to employee fitness
(4) twenty optional, paid hours per year allocated to service projects of the employee's choice
(5) a one-year term for managers
(6) weekly personal-progress interviews

Nothing to Fear, But No Health Care

We have never needed democracy more than we do now. We need to democratize (not socialize) our government, democratize our health care companies, and democratize our businesses.

"Fifty million Americans are without health insurance, and 25 million are “underinsured.” Millions being laid off will soon be added to those rolls. Medical bills cause more than half of personal bankruptcies in the U.S. Desperate for care, the under- and uninsured flock to emergency rooms, often dealing with problems that could have been prevented." -- Amy Goodman of Democracy Now!

My Latest Letter to Obama

The U.S. is a democracy; yet, the dominant corporations of our time are run like oligarchies. Throughout U.S. and world history, this contradiction of oligarchies within a democracy has proven costly to lives, tax dollars, and many of our freedoms. A tax cut to organizationally democratic corporations will save and make the government billions of dollars a year and will recruit the talent needed to get us out of this economic crisis.

Corporations are legally obligated to put the interests of shareholders above all competing interests; when corporations are not organizationally democratic, the interests of the majority are often overlooked. Corporations have overlooked the interests of the majority...

(1) by evading between $250 billion and $300 billion in taxes per year. As a result, you and I pay 15% more in taxes every year--according to PBS Frontline. When corporations' financials are not transparent, the pressure to follow the crowd and use tax shelters to evade taxes is constantly present.

(2) by not making health coverage affordable. Wal-Mart and other corporations have encouraged their employees to apply for government health care assistance--instead of making medical coverage affordable. Government health care assistance costs the government billions of dollars.

(3) by outsourcing jobs to foreign countries. Billions of tax dollars have been lost to outsourcing.

(4) by paying CEO's 866 times more than minimum wage employees. That number has increased from 51 times in 1965--according to faireconomy.org. When corporations create many layers of management, the higher up managers receive large compensations at the expense of lower paid employees. However, when times get tough, having a large number of managerial layers ensures that layoffs will occur, and higher paid managers are consistently the ones laid off. Unemployment and low wages cost the government billions of dollars in relief.

(5) by underpaying their employee's pension plans. In 2006, PBS Frontline reported that corporations were underpaying their employee's pension plans by $450 billion. As you may know, in 2006, the government agency, P.B.G.C., was already in a $23 billion debt. The government can't afford to guarantee all of these and future pension plans that are dumped on the government during corporate bankruptcy.

(6) by constantly violating the law. In the 1990's, large corporations were sued for hundreds of millions of dollars for attempting to pass off costs and obligations to an unaware or unwilling public: (1) Exxon pled guilty to criminal charges related to the Valdez oil spill and paid $125 million (2) GE was guilty of defrauding the federal government and paid $9.5 million (3) Chevron was guilty of environmental violations and paid $6.5 million (4) Mitsubishi was guilty of anti-trust violations and paid $1.8 million (5) IBM was guilty of illegal exports and paid $8.5 million (6) Pfizer was guilty of anti-trust violations and paid $20 million (7) Odwalla was found guilty of food and drug violations and paid $1.5 million (8) Sears was guilty of financial fraud and paid $60 million. (Read about 1,000's of more violations at multinationalmonitor.org). The cost to the government for all unprosecuted violations is probably in the billions.

(7) by creating unfulfilling workplaces. In 2006, Gallup estimated that disengaged employees cost the American economy $350 billion per year. The lost tax-dollar revenues are also in the billions.

In contrast, organizationally democratic corporations are proactively transparent, offer ownership to all employees, and have very few layers of management (in proportion to number of workers).

During this information age, many corporations such as, Southwest Airlines, Great Harvest, 1-800-GOT-JUNK, the GE plant that produces Air Force One engines, DaVita, The Container Store, and Whole Foods (to name a few) are moving towards this new, democratic corporate structure. Not only does this new, democratic corporate structure attract the best talent in the U.S., but these corporations save and make the U.S. government millions of dollars. A tax cut to organizationally democratic corporations would encourage more corporations to become democratic. More organizationally democratic corporations would attract the necessary talent to pull us out of this financial crisis and save and make the government billions of dollars.

The largest obstacle for identifying organizationally democratic corporations will be to create a standard to determine which corporations are organizationally democratic and which one's are not. A consulting company called World Blu (worldblu.com) currently has a score card to identify organizationally democratic corporations. If you have any questions, visit my website at democraticbusiness.blogspot.com and make a comment.

The Bailout: Borrowing Without a Plan

Politicians and economists call it "pumping money into the economy". I call it borrowing without a plan to repay. If I have a failing business, $175,000 in debt, and I ask you for money to save my business, wouldn't the logical question be, 'How am I going to pay that money back?'

Today, I watched an economic discussion about the bailout on MSNBC. Only one person ever brought up the question, "How are we going to pay this money back to the countries that are buying our debt?" The Chinese and the other countries--that are buying our debt--are asking this question for the first time. It is time that we give them an answer, or they may walk away.

The U.S. currently has a $53 Trillion debt. That means that every person alive today and every child born today inherit over a $175,000 mortgage. How are we going to pay that mortgage back? The truth is, we haven't put down our credit cards long enough to answer that question. One thing is for sure, we WILL pay it back when our creditors demand. There is no such thing as Chapter 11 bankruptcy in the real world.

Synopsis by MSNBC of the Bailout:

Stimulus package from February 2008---------------- $168 Billion
Fannie Mae, Freddie Mac------------------------------- $200 Billion
AIG-------------------------------------------------------- $122.8 Billion
Financial Bailout (TARP)
(Auto Bailout Component= $17.4 Billion)------------- $700 Billion
Obama Plan---------------------------------------------- $775 Billion
_______________________________________________________
Total------------------------------------------------------ $1.9 Trillion

What Are the 3 Biggest Obstacles to Democratizing the World's Workplaces?

Traci Fenton speaks at least weekly with CEOs of companies that will potentially use her consulting services to democratize their organizations. In a conversation I had with Traci Fenton (CEO of WorldBlu), she identified the three biggest obstacles to democratizing the workplaces of the world:

(1) Many people do not realize that there is a better alternative to oligarchical businesses.

(2) Many people are not willing to give up the feeling of control over their businesses.

(3) Many people are, simply, greedy.

Sounds pretty overwhelming. We are seeing, however, that the biggest obstacles are not as big as the biggest drivers of democratizing the workplaces of the world. Here are the reasons:

(1) The people of the world are beginning to think less of themselves as national citizens and more of themselves as world citizens.

(2) The information age is democratizing even the most undemocratic nations of the world.

(3) Oligarchical companies are losing the most talented people to democratic companies (e.g., computer technology industry vs. banking industry).

(4) More and more people are realizing that the current capitalist system has not benefited the majority of the world; yet, communism is no longer a widely attractive alternative.

How To Change Our Failing Businesses

Every day we hear about change: change on Wall Street, change in Iraq, change in Palestine, change in the car industry, and change in health care...Whether we speak of a country, a company, or an organization, how does successful, long-lasting change occur?

Ricardo Semler (CEO of Semco) put it this way, "How do you get a sizable organization to change without telling it--or even asking it--to change? It's actually easy--but only if you're willing to give up control. People, I've found, will act in their best interests, and by extension in their organization's best interests, if they're given complete freedom. It's only when you rein them in, when you tell them what to do and how to think, that they become inflexible, bureaucratic, and stagnant. Forcing change is the surest way to frustrate change." (harvardbusinessonline article)

What a completely counter intuitive statement. If we want a country, a company, or an organization to change, we give back, to the people, the power and control to change themselves; then, we get out of the way. Actually, it makes a lot of sense. So long as people feel that they have control, there is nothing to rebel against, and they act in their best interests and their organization's best interest.

How Do We Respond to the Current Economic Conditions?

Fast Company recently asked the author of Good to Great (7 million copies sold), Jim Collins, "What does your research suggest about the best way to respond to the current economic slowdown?"

He answered, "If I were running a company today, I would have one priority above all others: to acquire as many of the best people as I could. I'd put off everything else to fill my bus. Because things are going to come back. My flywheel is going to start to turn. And the single biggest constraint on the success of my organization is the ability to get and hang on to enough of the right people."

Is it safe to say, then, that the economy is in trouble because the largest corporations in the U.S. do not have the right people to make the right decisions? Why have many of the largest companies in America not been able to "hang on to enough of the right people"?

In an industry of nearly 100% turnover annually, the Container Store's turnover is 18% annually. Not only does the Container Store hang on to the right people, but, the Container Store has been on Fortune's list of The Best Companies to Work For since 2000; twice, the company has been number one. One employee boasts that she turned down a job at the World Bank to work for the Container Store. The Container Store is able to "get and hang on to enough of the right people" because they have created a democratic company.

A quick evaluation of all The Best Companies to Work For demonstrates that "the ability to get and hang on to the right people" is a matter of company structure and company culture. The current economic times are not the result of bad debt. They are the result of a rejection by the latest generation of workers in America and the result of many large companies' inability to "get and hang on to enough of the right people."

Why Is Democratic Business the Obvious Solution to Me?

Yesterday, I attempted to explain why democratic business is so important to me as a solution to the majority of the temporal problems in the world. The answer is that my life experiences have molded my perspective:

I grew up in an affluent section of a big city. The benefits of capitalism constantly surround me.

I have attended church all my life. I was blessed with a heavy conscience and a reverence for human potential.

I have started my own business. After I spent months proving that the business concept was equitable, my financer demanded 90% of the business. I shut down the operations because I could not survive on 10% of the profits.

My father is an entrepreneur. He started two successful businesses. He and I have engaged in hundreds of hours of discussions about his day-to-day business concerns.

I have lived among the people in Brazil. I know what it feels like to look at the U.S. from the outside in. I have survived on one meal a day for multiple months, experienced diseases and ailments foreign to Americans, feared for my safety at the hands of local police, drunk brown water to quench my thirst, and fought off thieves to protect what little I had.

I have lived in Hawaii and learned of its history. I have visited the Dole plantation and I have learned from the Locals how the U.S. reluctantly annexed Hawaii after corporations forcibly removed Queen Lili'uokalani--a queen loved by her people and dedicated to nonviolence--in order to protect their business interests. I have seen the resulted poverty that effects so many natives on the islands.

I have a degree in business management with an emphasis in entrepreneurship. I have studied the Nash equilibrium, laissez-faire capitalism, and other theories that help "businessmen" justify greedy business practices. At the same time, I have learned about the successes of Muhammad Yunus, Fabio Rosa, Albina Ruiz, and many other heroic entrepreneurs that add value to the world and not just to their pocket books.

I have a minor in Spanish with an emphasis in Latin American studies. I have studied the literature of Pablo Neruda, Gabriel García Márquez, Gabriela Mistral, García Lorca, Octavio Paz, and the hundreds of other literary leaders that dedicated much of their lives and writings to fight corruption and inequality.

My collective experiences have offered me the motivation to search for a better alternative to the dominant and dominating institution of our time. I have come to realize that I would be selfish not to do all that I can to act upon those things I know to be true for the sake of those who don't know that there is a better alternative. For this reason, democratic business is so important to me.