Yes, it is that gut feeling of “what if” that eats away at you.

And by fix it make it so that it is difficult, if not impossible, to do again.

Last week I made a stupid and very insensitive comment about China that I regretted as soon as i posted it. It was unprofessional and lowered the standards of this blog, I am sorry.

If we are not willing to get better then we have not earned the opportunity to receive the reward. Free market reveals & rewards excellence & reveals & subtracts from complacency.

Agreed. I think people want the government “cushion” due to fear that a program , like the postal service, will disappear if run improperly. ” What will I do if the ability to mail something just stops some day” they might think.
To me it sounds like an opportunity.

Nicely done. That was well said.

As the nature of economics changes, so does the functionality of Adam Smith’s invisible hand. As the cost of living continues to approach zero, supply and demand become less functional. to illustrate my point look at the iPhone. Millions of dollars of functionality for a few hundred dollars. its why the government is getting away with printing money without runaway inflation. it is being offset with the deflative pressures of technological improvements.
Your example of healthcare is interesting. Americans who want to cling to a supply/demand model pay many more times for comparatively substandard healthcare, than other industrialized nations. As time goes on supply and demand will be less forceful. What will? Hard to say. It will be interesting to see.

Love your line of reasoning! For the reasons you described I believe as many government services as possible should be privatized. People should have a choice as to how they spend their money and who with. So many government agencies are very inefficiently run because they have no incentive to run any better. Thanks again for taking the time to write these thoughtful posts every day!

You spoke about what keeps Mary and John honest, but what about the honesty of the customer? The insurance industry sales products that are often abused by customers in the form of litigation, costing the industry billions of dollars per year. How does Mary or John keep themselves honest in the wake of this type of consumer activity?

There is also competition between individual employees that results in increased productivity and customer satisfaction. I always try to reward those who are most efficient, courteous, and work as part of the team. Fulfilling the customers expectations is the key to referrals and repeat business. We don’t try to burn any bridges!

Larry, I live just over the hill from the Vegas to Reno finish line. I will be at the finish line and will see you there! If you get a chance while you are at the northern end of Nevada, be sure to go to Virginia City, home of the Virginia City Grand Prix. Virginia City is the largest historical landmark in the US, with great history as a silver mining town. The VCGP starts on main street in town and then heads out into the surrounding hills.

Competition is the backbone of a competitive marketplace. Couple that with the “invisible hand” and it is a fascinating model.

Some of us are producers, but every last one of us is a consumer. When consumers win with free trade, we all win.

Thank you Larry, for the very simple and excellent lesson on free market capitalism!! It needs to be told to more people through more outlets.

100% agree with your post. I have four sons ages 30-35. They were made in America. None of them want factory jobs but they do want lower prices. We all do. Furthermore, I’m a wholesaler of plumbing supplies and I sell to plumbers. Some very large and other very small. The larger players buy cheap and have most of the bargaining power. Several suppliers fight and lower pricing, extend terms etc…. just to get the large players business. My point is, America holds the power here when we are the largest player in the market. Let’s use our buying power to buy better and stop these nonsensical trade wars. We are only taxing ourselves. No disrespect to those who feel differently but my suggestion would be to sign up for an economics course to gain a better understanding of free markets and how important it is to the US economy. More markets equal more competition and more competition is good for the consumer.

Well said Larry!
Buy American Smart!

I am a maintenance supervisor at a manufacturing company in Shelton CT, we make parts for all kinds of companies especially automotive. The machines are loud and the work is repetitive and we have machine operators that have been there for forty years or more, is that any worse than crawling into a crawl space or attic day in and day out? Not everyone is going to college. There have been a lot of american companies that just sold out. I am all for competition, but how do you deal with a country like China when the only good idea they came up with was to steal everyone else`s idea`s and become a super power.

I have read and reread your recent blog posts regarding capitalism, the advantages of free markets, and the problems with slogans like buy American, etc. You have some legitimate points but like the slogans you rightly suggest over simplify an issue your analysis of why free market capitalism is a better system makes much the same mistake just in a lot more words. For one thing the free market capitalism you describe does not exist for the most part except in theory and for another our loyalty to an ideal or principle is of equal or greater importance than the one sided view you have articulated in your posts. To illustrate the point I will share a personal life altering story with you:

In 2003 I was working for a professional liability insurance company that had been acquired by General Electric a few year earlier. Also in that year the US and allies invaded Iraq and my son was among the first to be sent off to war in what would become the longest year of my life living in constant fear that someone in dress uniform would knock on our door to report his death. (in fact his best friend was killed by a suicide bomber that year). Shortly after his deployment I was asked to attend a presentation in Overland Park, Kansas at out parent company, ERC (Employers Reinsurance Corporation) to listen to Jack Welch, Chairman/CEO of GE expound on his views of business. I was dumbfounded to listen to his opinions that loyalty was dead, employees should be prepared to be terminated at any time (always be in fear of losing your job), the only thing that really mattered was getting the numbers and if your company or division couldn’t produce a net in excess of 28% be prepared to be sold or liquidated. In short the only thing that mattered were the numbers. I thought about those remarks for a long time particularly in the context that my son’s life depended on reciprocal loyalty to his country and to his unit and it was his willingness and those around him to adhere to that code that made it possible for Mr. Welch to have the freedom to express his opinions and pursue GE’s corporate goals.. That presentation altered my life because much to the dismay of my superiors I resigned three months later after 18 years and went into business for myself. I was offered more money, a promotion all to no avail as I explained I would not work for anyone whose view of the world was constrained to “getting the numbers”, whatever the cost.

So how did GE’s pursuit of getting the numbers work out. Well, “free market capitalism” didn’t exist for GE, one of the most criminally and civilly fined companies in the US in 2003. The way GE and many companies work is by stifling competition, bribing officials, buying out competitors and shutting them down, and by controlling expenses the biggest of which (for most companies) is labor. In an ideal “free market” world all companies would compete on a level playing field, with workers in a particular industry given similar wages and benefits. But that’s not the way it works. In fact you could probably say slavery is the ultimate expression of capitalism – nothing better than free labor. So why do you think we have had to pass so many laws to protect workers? That comes at a cost so if labor costs are a problem and you can’t get around that through mechanization then you either find a way to cheat or move offshore, where the laws are less restrictive, which brings me back to GE and its move to send work to China and India. {And by the way these weren’t just manufacturing jobs, it was service and clerical jobs as well, I know because I was there when the “process mappers” from India showed up to figure out how many clerical and service jobs could be “mapped” to Bangalore, India ). So what’s been the net result of this competition to reduce costs and deliver a cheaper product to the consumer? Well in the case of China we are certainly waking up to Jack’s and many other CEO’s mistake – the largest transfer of wealth and technology (the FBI’s characterization not mine) in world history.

What’s my point? What was the cost? To quote you:

“We have come a long way, and we have all benefitted.  America has adapted. Americans live far better today and have far more choices than they did in 1964 when I was born or in 1982 when I graduated high school”

It might interest you to know that in 1985 the US became the world’’s largest debtor nation, thanks to decisions by Jack Welch, other likeminded CEOs and our elected representatives – a debt my children and grandchildren will bear as a burden in the form of higher interest rates and taxation. Was my son’s loyalty misplaced? Is that how “we have all benefited? Jack had no loyalty to anything other than shareholder value. It’s equally disturbing that in 1964 we produced almost all our own clothes, pharmaceuticals, etc. and now we find ourselves vulnerable to foreign interests in many vital areas. Is that how “we have all benefited”? The outcome for GE as a direct result of Jack’s and his hand picked and trained successor Jeff Immelt’s policies is a company saddled with debt and worth about 10% of what it was valued at in 2000. My personal observation as to one reason why GE is in its current sorry state is that lack of loyalty – the thing that helped my son through his experience in Iraq. GE drove out all the people that cared about getting it right, getting it done, caring about the customer, making things, etc. and replaced them with people that did whatever it took to “get the numbers”. They drove out everybody else – the people that actually cared. Sure labor costs came down and the share price went up but the underlying motivation ignored what really made the company great and that was the loyalty of it’s employees to the company and its ideals. So when you say slogans like “Buy American” are “ignorant” I would urge you to check your prejudice and look at the issue a little deeper. First it is pure fantasy that free market capitalism exists in most parts of the world to any great degree when the driving forces of capitalism are maximizing gain by driving down costs. Likewise it a fantasy that loyalty to an ideal whether it be company or a country and its principles don’t matter. At the end of the day for most capitalists “greed is good” to quote a movie character, to which I would reply, yes but principles and loyalty matter.

(Note: You may be wondering why GE took an interest in insurance companies like the one I worked for, when they were noted for many other things. They didn’t care about delivering a quality service or product to insurance consumers in spite of all their promotional double talk. What they really were interested in was the large amount of cash reserves many of these companies held to pay future losses. In the insurance world companies are required by law to set aside a certain amount of money to cover future claims. This dollar amount is referred to as a loss reserve and represents liquid assets that can be converted to cash to pay claims. The first act of GE’s “process managers” was to have the reserve amounts on pending cases reduced so they could strip the excess cash for other purposes, acts that now are still being litigated and investigated.)

Signed:

Vic Bennett
Arizona Foundation Solutions

KTM…..nice. You will love it.

Thank you for posting those posts – they are invaluable in the basic understanding of the meaning of freedom in a social and business environments

Nice job! This is so hard for people to understand. I remember when I was a kid, my father saying we should spend our money in our little town rather than the slightly bigger town 25 miles ago. Basic principles of economics can be counterintuitive.

You post makes perfect sense. Thank you for your daily posts!

“ Free market capitalism is where we all have the opportunity to serve others by making better mousetraps or giving better service.”
Should be replaced with:
“Free market capitalism is where we all have the opportunity to pursue our own values by creating values for others through free, voluntary exchange.”

I don’t disagree. however lets give credit where credit is due. The Dutch invented Capitalism… we just took their ideas when they came here (Wall Street was originally a Dutch settlement) and made them better.

Bravo and thanks for standing for American values!!!💪🏼🇺🇸

Larry,
Well articulated. If only more people thought logically and didn’t jump emotionally, we might be able to have more discourse and solve more problems!!

Adam Smith… the Wealth of Nations….. do what you do best and trade for the rest.

I learned from you Larry…I was doing the “wrong work” and was working very hard spinning my wheels. Your “highest calling” book opened my eyes! I was once told “working your fingers to the bones will only get you boney fingers” it’s true. That was from a 87 yr old contractor friend of mine. Why did it take me so long to figure it out? Still working on that …hard to teach a old dog new tricks, but I’m conditioning myself 🙂

I’m not sure about getting paid more. I think you you pay someone a good wage for an honest days work. As far as the person not working as hard I believe if a manager or foreman is doing their job well then this person not working as hard or diligently should have been coached and or trained more. I believe if you are doing the same jobs for the same pay then it’s an equal playing field. Everyone must carry their on weight. Sales is a different story when commissions are involved. Some people have more of a drive to push themselves more to make more money.

Yes, if the value he provides to whomever he is shoveling the dirt for, justifies it.

Work smarter not harder. I think back to one of the things you said last year at the Think Daily Live session. If you want to earn $250,000 per year are you doing the $20 per hour work or the $100 per hour work….

No

You should get paid as much as you agreed to get paid before you started digging. If someone is helping you dig and they are digging as much then “fairness” would say they shouldn’t be paid as much. However, both should get paid the agreed-upon price from the beginning. The reward for the hard worker comes later as someone notices the hard work and rewards with higher pay or a better position in the future. We work hard now in hopes of future gains.

(*corrected typo in previous comment)
You should get paid as much as you agreed to get paid before you started digging. If someone is helping you dig and they aren’t digging as much then “fairness” would say they shouldn’t be paid as much. However, both should get paid the agreed-upon price from the beginning. The reward for the hard worker comes later as someone notices the hard work and rewards with higher pay or a better position in the future. We work hard now in hopes of future gains.

I’ve pondered this in a different context for many years and is extremely relevant today with the large number of unemployed thru no fault of their own. It’s this. If one is willing to work at any job for 40 plus hours, regardless of job, should they make enough money to support food shelter and basic medical care for themselves and their immediate family?

working hard physically rarely if ever has a higher value than working productively and creating the opportunity and setting the direction for those who work hard physically.

I had to re-read it. Should a person be paid more for working harder? If that means being more productive, then perhaps yes. I won’t pay a kid more to cut my acre of grass with a push-mower than a kid that shows up with a riding mower! Payment represents VALUE (some blend of quantity and quality) received by the payer (employer, the customer of your labor). Effort is important, but not the determinant of compensation.

Yes you should get paid more if you have a boss that recognizes that you are the hardest working person on the job, unless you are in a union, then it does not matter. Should my friends have gotten the same pay as me when they were home watching cartoons and I was out shinning shoes all day?

Hard is relative.

In our economic system (nor any economic system that I am aware of) a person does not get compensated for burning calories. We pay based on special skills (can you hit a 100 mph fastball), training (12 years to become a brain surgeon) or the percentage of the population willing to do a certain task (pulling hoses at Gates Rubber means you always have burns all over your arms).

No. The fact that you labor all day is totally up to you. You should always get what you bargained for.

You should truly get paid for your knowledge. Different levels of knowledge equal different levels of pay.

You should if that is what was agreed upon. A persons pay for any assignment should be a private negotiation between the 2 parties involved: the payer and the worker. If you with your shovel had adequate negotiation skills, and placed yourself in a situation when shovelers are in high demand/short supply, you could get big $$. And vice-versa.

Firstly, I’m glad for you that your knee doctor is “working hard and sweating” for you.

Get paid for what you achieve for the Company.

Shovel dirt, shovel brain cells, shovel something. If you hurt yourself shoveling so that you’re unable to work the next day, that’s not good either. I’d rather have an employee that’s consistent than a flash in the pan all star one day and a no show the next. Life is a marathon, not a sprint. That doesn’t mean you don’t have to hustle though. But are you being effective? Are you getting things done? Perfect is the enemy of the good. If you’re always busy but not getting anything done, what good is that? I remember a boss who asked me how I was doing and I proceeded to tell him how busy I was. His reply? “Don’t confuse being busy with making money.”

Good morning Larry! I feel life must be a healthy balance of choices. If we indulge in too much of anything (even a good thing), it can overpower other aspects of our lives in a negative way. If we reflect on our daily routines, it will show us if changes need to be made. Have a great day everyone 🙂

Thanks for the shout out Larry!!!! It was a beautiful morning in East Tennessee and I got to go visit a few customers. Life is good and the best is yet to come.

Absolutely agree. The difference between ordinary and extraordinary is the little “extra”

I love this story. Such a great example of why we need to be the professional and the expert in business first and foremost!

Go to the ant thou sluggard; consider her ways and be wise: Which having no guide, overseer or ruler provides her food in the summer and gathers her food in the harvest.
King Solomen

Most Lottery winners file for Bankrupty as well ! Larry thanks for bringing so much value to peoples lives in so many ways! – Donnie

Hi Larry! Keep going! Great business & life valuable tidbits!

I agree! This is an interesting way of looking at it.

Never would one imagine how rapidly this nation is trending the opposite way. The 1776 Project gets it right for the birth of equal opportunity to reach for the sky!!!
We’ve got to wake up to what happening right NOW!!!

You nailed it in your analysis! We need enough people in America to realize this, before it’s too late. If income inequality were truly unleashed in America, there is no telling how great it could become for vast majority of everyone. Even those that disagree with it. We had a nice taste of a strong financial surge, just before COVID. Lord willing, we’ll have more opportunity to crank up the American economy again, and keep it cranked up.
Thanks for all you do, Larry!

Amen Larry! Great way to look at it.

I agree with your sentiments. If the results of income inequality is visible and obvious, everybody knows what they need to do to move their individual bar. Handout is not the answer. If we push ourselves from within and do our best, income will not be a problem. But if we wait for someone to do it for us, then we are doomed.

Cory, well said! I am only speaking for me. I am in the category of having “experienced something in life that imbedded a desire to make a change.” I know a lot of people that own businesses and are using them for meaningful change in their communities and beyond. Very few of them have convinced themselves and/or their children that expensive things and fancy status should be a driving factor in how much work ethic one should present. Nearly all, use their businesses as tools to change the life trajectory of many, in a meaningful way. Paying people fairly and rewarding those that go above and beyond is an everyday thing for them, and for myself. Doing this in a thriving economy, where everyone is lifted up, and the givers give significantly, is a beautiful thing to see. I’ll continue to pray for a thriving economy, where the majority can be lifted up. If it’s a worthy prayer, it will be answered. If not, it will not. Regardless, we should be outstanding stewards of all we’re blessed with. That’s each other and this beautiful earth – which is very well stated by you.

We should have income inequality.. Otherwise, why would anyone want to do any better, more importantly, why would anyone want to be any better? The lost art of working to become better or to get better needs to be brought back, I may be a little bias about this, but I still believe in earning what you get. Call it old fashioned or whatever you want to call it. The truth is, everyone should earn their “trophy”. If you are in an area where you don’t have the capacity to get that “trophy”. Either try a little harder or get in the area that better suits you. We all face inequality every single day. Some of us don’t complain about it, instead, we work harder to be better. To me, it’s a competition within myself that I intend to win…

I agree 100%. The problem in the USA today is Entitlement Programs. They only confirm that being lazy & NOT wanting to get better is much easier, then working 40+ hours a week to get ahead. It also confirms how bad this new idea that every child gets a participation award is, instead of 1st, 2nd, 3rd place. What message does that send to our youth, all I have to do is show up & I get a trophy. The American dream is all about being able to get ahead, not be content with the status quo, to just get by. Competition in life & business has ALWAYS been healthy & taken away would only be disastrous. Keep up the good work!

I have had a similar discussion a number of times through the years with folk, including some staff. I have ask “Would you rather make $10/hr working for an owner who works right beside you every day and makes the same s you or would you rather make $15/hr working for a rich man who never shows his face at the job and is golfing every day. I have been very disappointing that the majority of responses have been to work for the owner who is poor. I fear our educational system (and I would include parenting in this) have failed us.

I am for inequality in pay. But some people seem to think that money is like a pie. There are only so many pieces and if one person gets more it means that they get less. But that is not true. Most things increase when everyone is doing their part and adding value so everyone can earn more.
As our company has grown in revenue and profits we are able to pay our productive employees more and offer them more benefits. But those that don’t do their part and do no more than just show up, should not and do not enjoy those same increases. It would not be fair to those that are adding value and would decrease their moral. Our Company would die and we would all be without an income.

I think that’s a great way to think about some of the current events I’m with you Larry

This is a great philosophy for a rich white man from Connecticut. As you say “ if I am to be a pauper, my chances are far better if my neighbors were all rich, than if they were all paupers too.“ How fortunate you were to grow up in an affluent neighborhood with access to good schools, but not everyone has the same advantage Larry. According to 2020 Pew research, white women make 83% as much as what men earned per hour in similar jobs, these statistics are even worse for minorities. Do you believe that women and minorities deserve to make less than white men because we don’t work as hard? Or are we less incentivized to work hard because when we look at the top income earners in the US we see a sea of old white men ?

You nailed it. We all have the opportunity to increase our financial standing in this great country. Let us not forget what has made America great, its something called capitalism. If we loose that our envy in the world is over. Our desire to risk and fight each and every day is over. Give me income inequality, it’s my motivator!

Growing up in an apartment on the north end of Bridgeport with five siblings and always wearing hand me down clothes I started shining shoes when I was ten years old on main street in 1968. I soon realized that the best place to shine shoes was in the biker bars, the bar tenders always tried to kick me out but the bikers always won and let me shine their boots, I made a lot of money! I have been improvising and learning all my life and I`m doing pretty good, always trying to lift people around me.

Truer words have never been spoken. They are based on fact and are perfectly reflective of human nature. The social cry for income equality is a political dogma that is animated by strictly emotional reactions. We live in a strange world where immediate access to millions is achievable thru social media. A world where senseless and even destructive ideas are cast across the globe. You are doing your part to counter these counterproductive ideas. Keep it up!

I can agree in principle, but your argument is too simple. If people have integrity and compassion, this works. When they don’t, and employees can’t make a living wage, they can’t change jobs because they lose health insurance, they become like indentured servants. Yes, this also is an oversimplification, but that is the point. There can be middle ground where people are free to grow as much as they can, as long as they treat people with respect along the way. If you are going to own a business, I believe you should be obligated to take care of your employees. When they choose another path, what other option than for government to step in?

Amen

Exactly

I was discussing this with my extended family just this weekend. Great subject.

Larry, thank you very much for speaking about income inequality! You are right on target and I agree with you completely. I can’t wait to hear what you have to say tomorrow! If I had to guess you would say something to the effect that if there weren’t people out there making a lot more money than us then who would we be working for? How about if we want to boost income then we simply need to boost our self-worth?
Thanks again for your insightful “Think Daily” column!

Great message Larry! Thank you for sharing and congrats on your result

And congratulations on your earned results!

Hi Larry and group! I can understand your desire to trade 4 wheels for 2…. This summer I travel to and from the office on my Victory and keep all my tools and samples available if I need to go out on the road. I am fortunate that most of my customer visits are ride alongs so our Specialists have everything needed for the customer visits in their car but if need be I use one of our company cars for un expected trips to clients. The ride in the morning and evening clears my mind and makes everything so much more fun! Thank you for these daily nuggets and thank you for creating a learning environment where we all get better everyday! Congratulations on your results and keep up the good example you show us everyday!

Good story and very relatable!

Feng Shui sets up environments for growth in every area. It balances the 4 elements and brings you abundance in your life so you can grow.