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How to Build—or Blow—Support for Healthcare Reform
Tweet Share on Facebook March 29, 2010 Comment (19)The roadshow is on. With healthcare reform now a reality, President Obama and congressional Democrats are stumping across the nation to explain all the good things the new law will do for voters. They're likely to hit a wall of skepticism.
As the historic law finally passed, a Gallup Poll found that 49 percent of Americans approved the effort, while 40 percent opposed it. Other polls show less support and more opposition. Legal challenges to the law, antireform rallies, and threats of violence against supporters suggest that healthcare reform will remain a white-hot issue. In Gallup's poll, 42 percent of respondents said they're either disappointed or angry that reform passed. Republicans, not surprisingly, are the most disenchanted, but 47 percent of independents also said they're disappointed or angry. And they're the ones who could swing the November elections one way or the other.
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How to Rebuild After Losing Your Fortune
Tweet Share on Facebook March 24, 2010 Comment (180)At a small gathering of entrepreneurs last September, it was Kevin Daum's turn to answer the regular monthly question and name something new he had done recently. Daum had two answers: One, he hadn't borrowed money from anybody. And two, he had eaten food from his barbecue grill every day for three weeks.
The revelations might have sounded whimsical, but the group knew that Daum had been struggling for more than a year to save a dying business, start a new one, and remain solvent. And his answers were, in fact, ominous. Daum had been eating from the grill because he couldn't muster $600 to refill the big propane tank that provided fuel for the stove in his Connecticut home. And he hadn't hit up friends or colleagues for any more money because he and his wife, Deanna, had decided to declare bankruptcy: They'd no longer have to scrape together funds for mortgage payments, credit card loans, and other overwhelming bills.
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5 Overblown Fears About Healthcare Reform
Tweet Share on Facebook March 22, 2010 Comment (164)In Washington, everybody knows about unintended consequences: the outcomes you fail to anticipate when you change the way something works. But there's another phenomenon that works somewhat in reverse: Preregulatory paranoia, or the fear that new rules meant to make the system better will instead produce mayhem and disaster.
It will be a long time before we know whether the historic healthcare reform finally passed by Congress will make the system better or worse. But the rhetoric surrounding the yearlong ordeal has already set new standards for overwrought fearmongering. There's a long history of pre-emptive hyperbole in Washington, in which the combatants on each side of an issue paint a dismal scenario if things don't go their way. But the dire predictions almost never materialize. Businesses adjust. Lawyers find loopholes. Lobbyists get new rules watered down. Entrepreneurs come up with better ways to make money, regardless of constraints. And if the new rules really do fail, we have this little process called electoral politics to make sure the government responds to voters' concerns.
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15 Trends That Will Reshape Your Office
Tweet Share on Facebook March 22, 2010 Comment (4)When Ken Seiff launches a New York-based, office-supply company later this year, the customer-service department will have a starring role. Customer-service reps are often shunted to a back room—or outsourced to cheap overseas outfits. But Seiff wants his managers, sales and marketing team, and support staff to know what the phone reps are hearing from customers every day. "You won't be able to walk from one end of the office to another without going through customer service," he says. And an open environment, he hopes, will help foster the communication that's vital in a start-up.
[See 7 stressors sapping the middle class.]
The office is undergoing a transformation—and not just because of the recession. Even as companies downsize their office space along with their payrolls, powerful business trends are forcing corporate America to reorganize everything from the supply closet to the boardroom. Corporate bureaucracies often move too slowly, and the traditional business setup, with executive offices surrounding banks of cubicles, reflects that. So companies big and small are tearing down walls, experimenting with technology, and creating funky new spaces to juice creativity and innovation. "Everybody's looking for a competitive advantage," says Jim Keane, president of Steelcase, a big office-furniture company based in Grand Rapids, Mich. "These days, there's less hierarchy and less structure, and more transparency and nimbleness."
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One Lesson From The Toyota Flap: Americans Can’t Drive
Tweet Share on Facebook March 17, 2010 Comment (35)The modern automobile is a marvel of simplicity: You just get in and turn it on, and with no effort at all you're piloting a two-ton contraption with thousands of moving parts and dozens of computer modules.
There's not much else in our everyday lives that makes mind-boggling complexity so user-friendly. Driving requires no knowledge whatsoever of mechanics, combustion, electronics, aerodynamics, chemistry, software or physics, even though all those things are all essential elements of a car. There are even more systems on the way for handling tasks that used to be the responsibility of humans. New cruise-control systems sense when there's a car ahead of you, and automatically apply the brakes. Other sensors let you know when a car's in your blind spot on either side, so you don't collide while changing lanes. And we may soon be able to tell our cars what radio station or climate setting we want, instead of poking at buttons.
[See what Toyota could learn from Detroit.]
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7 Stressors Sapping the Middle Class
Tweet Share on Facebook March 16, 2010 Comment (173)We all know about keeping up with the Joneses. Now, the Great Recession and the jobless recovery have introduced a new socioeconomic phenomenon: slip-sliding with the Smiths.
Working harder for less is the new normal—for those lucky enough to have a job. Millions of families are giving up comforts they long took for granted, such as restaurant meals, new clothes, vacations, spacious cars, home improvements, and cable television. College funds and retirement savings have taken a hit, and some families have been forced to downsize their homes or, worse, submit to foreclosure. Little wonder that record numbers of Americans tell pollsters it's getting harder to get ahead and that they worry their kids' standard of living may fall rather than rise.
[Slide Show: How to Gauge Your Middle-Class Status.]
The obvious culprit is a terrible job market that has left 15 million Americans out of work and millions more working less than they would like. But several economic trends have been stressing the American middle class for a decade or more, and the recession intensified those pressures as well. Healthcare and college costs, for example, have been rising unabated. Seniors who are living longer require more late-in-life care, with the costs often borne by their middle-aged kids. A turbulent economy, meanwhile, has hammered away at incomes, job security, and net worth—and even led the White House to create a "middle-class task force" that gives the problem an official hue: "It is harder to attain a middle-class lifestyle now than it was in the recent past," declared a recent task-force report.
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How a Corrupt Lehman Nearly Hoodwinked Washington
Tweet Share on Facebook March 15, 2010 Comment (3)Lehman Brothers is becoming a historical artifact, a corporate fossil like Enron and Worldcom that we can dissect to learn about its inner decay. But as revelations mount about the degree of corruption at Lehman, we're forgetting that the failed investment bank nearly garnered a taxpayer-assisted buyout in 2008 that would have saved the firm and probably prevented public disclosure of its most abusive practices.
A new report generated as part of Lehman's bankruptcy proceedings depicts a firm so desperate to attract funding and disguise its woes that it ginned up some creative accounting maneuvers that essentially allowed it to hide nearly $50 billion worth of money-losing assets. Even on Wall Street, that's a huge sum that could easily mean the difference between solvency and collapse. Examiner Anton Valukas , appointed by the bankruptcy court, has produced an exhaustive analysis of Lehman's operations that calls the firm's representation of its finances in 2008 "materially misleading." Senior Lehman executives ignored internal warnings from their own people, the report says, and hired a British law firm to bless the firm's practices because they wouldn't pass muster under U.S. law. Lehman's auditor, Ernst & Young, never objected to any of it and now finds itself on the hot seat.
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Why the Mail Should Come Every Other Day
Tweet Share on Facebook March 4, 2010 Comment (93)AT&T used to make phones and run the nation's telephone infrastructure. Now it's largely a wireless company. IBM and Hewlett-Packard transformed themselves from equipment manufacturers into business-service providers. Airlines have slashed service to small cities and added new fees for food and baggage. General Motors axed four of its eight divisions and fired two CEOs in less than six months.
[See 21 things we're learning to live without.]
Nobody likes radical change, but in corporate America, it's sometimes necessary to survive. Except at the U.S. Postal Service, which tries to act like a corporation but inevitably struggles to keep up with the times. The Postal Service is an odd institution, an "independent establishment" of the government that nonetheless has to abide by rules that virtually force it to lose money. It has a CEO and an 11-person board of governors that functions like a board of directors. It files an annual financial report with the Securities and Exchange Commission, like any publicly owned company. Yet the law requires the Postal Service to deliver mail to every address in America at prices that often fail to cover costs. It's not allowed to lay off workers or close money-losing offices, and to make major changes it usually needs permission from Congress—which practically guarantees government-style inefficiency.
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5 Reasons to Buy a Toyota
Tweet Share on Facebook March 2, 2010 Comment (63)It's hard to think of another company that nose-dived as fast as Toyota has. A few months ago, millions of drivers considered Toyota the gold standard for automobiles, with quality and reliability you could practically take for granted. Then came mysterious gas-pedal problems, claims of deadly "sudden acceleration" incidents, the global recall of more than 8 million vehicles, and vacillating assurances from shellshocked executives. The recalls could end up costing $2 billion or more. Toyota's sales have plunged, and its U.S. market share has fallen from 17 percent to 13 percent in just two months. The collapse rivals Enron or Lehman Brothers.
[See what Toyota could learn from Detroit.]
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Why Everybody Loses When Nobody Trusts Anybody
Tweet Share on Facebook March 1, 2010 Comment (9)It's easy to bash the government. Nobody likes the banks or their fat-cat CEOs. Corporate America is the enemy, laying off millions.
Do we trust anybody anymore? Actually, yes. In her new book, The Economics of Integrity, journalist Anna Bernasek describes how virtually every aspect of the modern economy—from routine transactions to the inner workings of the global monetary system—is based on an intricate web of trust. That might sound scary, but the fact is that a blend of government regulations, societal rules, and enlightened self-interest produces a system that serves consumers remarkably well, compared with the alternative. I spoke recently with Bernasek about the growing distrust in big institutions and the possible consequences. Excerpts:
Americans seem as if they don't trust anybody these days. They don't trust the government, they don't trust banks, and they don't trust institutions. Some of that is for good reason. And it seems to be one reason the tea-party movement has sprung up. Do we have a crisis of trust? Economically, I think it is a crisis of trust. You had President Obama talking about the deficit of trust in Washington. Look what happened with Toyota. There's a perception we can't trust automakers. At companies, there's been a lot of destruction of trust, especially with employees. What is a recession but a lack of trust?
[See what President Obama could bring to the tea party.]
