Dependence on Government

Emily Maltby writes an article today detailing some of the challenges small companies have in obtaining Federal contracts. The last two paragraphs worry me:

“Mr. Lebolo, however, is shifting his firm’s strategy to primarily focus on government work. “I made a determination to look hard into the federal market because it was the only place with money,” he says.

“He says he’s not frustrated by the relatively small price tag of his first government assignment. Now that the process of landing a contract is behind him, he says there is no going back to commercial construction. He hopes to grow and begin hiring again by the end of this year. “This is a long-term decision,” he says.”

When the government becomes the sole or dominant market for several sectors in the economy, what will happen? Will that prove beneficial to the economy? Will that situation increase or decrease innovation? Will it stimulate creative solutions to business and human problems?

I’ll have more to say about these questions, and this increasing trend of reliance on government for business’s economic well-being. But I don’t think it bodes well for the economy, creativity, innovation or America’s competitiveness in the global marketplace.

Paul Johnson on Two Key Leadership Traits

Excellent. Would that today’s leaders read and mind his advice.

Overhead Baggage and Political Intervention

Spirit Air’s decision to charge passengers for using overhead baggage space has created quite a furor. Now, the politicians are getting involved. Two senators want to pass a law barring these fees.

Good grief. While I might not condone Spirit Air’s action, why should politicians be able to interfere with their business? If Spirit is making a big mistake – which I think it is – the market will force them to reconsider. Passengers will choose other airlines, or they will check baggage, which is already subject to fees. Or they maybe they won’t even fly. But Spirit owns the asset, the plane with overhead space. Spirit should be allowed to try to make money in whatever way it deems possible. (Of course, this does not mean Spirit can or should let safety slip to save money). If Spirit thinks it can increase revenue by charging fees for overhead baggage, they should do it.

What’s next for politicians? Barring movie theaters from selling popcorn?



Tamny on the Yuan, Trade and Policy

As usual, John Tamny writes an excellent analysis of the Chinese yuan issue. A must-read this weekend.

March Statistics

Thanks for making March the best month yet on Capitolism.

Hits: 686, 87% more than February.

Average Hits Per Day: 22, up from 13

Passed 1,000 and 1,500 total hits on Capitolism, and 1,000 for the year.

Every day in the month had hits, a first for Capitolism. Every day except two had double-digit hits.

One post, my review of Henry V, had 207 hits, making it my most-visited post yet.

Thanks again for taking the time to read Capitolism.