When Will The Economy Get Better?

How do we get out of this poor economy? I find blame with all parties. Government policies encouraged poor decisions. Lenders got greedy along with Wall Street and many people were ignorant regarding personal finance or less than truthful about their ability to take on and pay back loans. So let’s lay blame everywhere and get on with fixing things. Energy spent on other than the obvious law breakers is wasted energy.

The Federal Government is not the solution. Yes, they can create money, but they have proven in the past and most recently that there is little control or efficiency in the distribution of the money. I say that it is the private sector’s responsibility.

In the past fifteen to twenty years we have forgotten some very basic principles about our domestic economy. In today’s business world the top executives earn a disproportionate amount of income.  The distance between the top and bottom earners continues to widen. In our zest to please the stockholders, boards approve top dollar compensation for reaching short term goals. Meanwhile, consumers are not earning enough to afford the very products their companies sell. It is a strong, content middle class who drives us. Who do you think was consuming so vigorously in China? The new Chinese middle class was building businesses and buying goods. Don’t get me wrong. I am a capitalist, but when businesses make poor decisions and focus solely on self-serving choices, we all pay. Leaders, who can’t run the companies soundly, just like beloved coaches, must leave when they lose too many times.

I am tired of hearing about government cabinet nominees and business leaders who have fallen from grace.  No one is irreplaceable.  In my decades long career I have yet to meet an indispensable leader. The onus is on us to choose better, more worthy leadership.  We must find the leaders with integrity to hold our most powerful and most valuable leadership positions. We can do so much better.  Our government, our businesses and the people they serve deserve so much better.

The incentives today are for short term performance therefore we get short term thinkers. Until we have the true desire to think long term and to exist together in less self-serving ways, we will be chasing our tails. We need to create balance. If the business leaders don’t manage our wealth, the politicians will do it for us. In fact they have already begun. Immediate and future tax dollars (US debt) are targeted to fund our way out of this mess. I prefer that the private sector distribute the wealth by re-establishing earnings for a broader populace. We need viable compensation packages from the bottom up.

It is up to us to make the conscious decision to act properly and with foresight. In my life I have witnessed cycles of growth and decline in the economy and have come to accept them as natural corrections and adjustments. Real growth can be sustaining and long lasting. Growth through acquisitions and financial instruments, that most people don’t understand, create a false and temporary signal to the markets that things are better than they actually are. In our very industry, asset sales and securitizations have replaced sound strategic planning and organic growth.

In order to climb out of this reality we must begin to accept long term solutions and avoid quick fixes.  Recovery can begin soon if our countr y’s business leaders agree and assure the presence of a strong middle class. The alternative is to have government in a leadership role versus a supportive and regulatory role. I know what I am wishing for.  I don’t want government to be the leader who takes our choices away.  As I write this I hear more predictions of doom and gloom, ever increasing concern about recovery being much further down the road.  I believe it can come sooner with the proper solutions from corporate America. The board rooms of America can make these decisions. They must make these decisions to reverse the current trend.