Wednesday, July 18, 2012
Marx got it right after all!
When I was little and lefty, I used to talk in bars about how capitalism was bound to imminent collapse under the weight of its own contradictions. Talk of which I was reminded this morning by a chance phrase in yesterday's Guardian about how UK spenders are not spending enough to pull us out of the recession. The contradiction being that I thought we largely got into our present pickle by spending too much, spending too much of other peoples' money.
To which an economist might respond that it all depends. You have a system with two constraints, one about spending too little and one about spending too much. Without more information it is impossible to say whether or not there is a market solution which satisfies both constraints. Nice fat grant needed to study the question at a proper depth.
There was also rather a tiresome article about the evils of outsourcing. Fair enough that it pointed to the various pitfalls & pratfalls of outsourcing, but no recognition at all that outsourcing is now a mainstream tool of management in both private and public sectors and that, other things being equal, it does make good sense to concentrate on core business and to get someone else to worry about the stuff round the edges. It is entirely likely that a catering contractor can make a better fist of running your canteen than you can. A catering contractor that can provide muscle, skills, standards and career opportunities that you are no position to match.
The trick being not to outsource your core business along with the bathwater.
In the case which is presently in the news, maybe the Olympics people should have contracted with the Census of Population Field Force people rather than some temporary staff agency. The Census people have plenty of experience of hiring large numbers of people for a short spell of boring, badly paid but important work and I do not recall them getting into the news in quite this way. But I suppose that is completely off message: public good, private profits better is the war cry of our present leaders. With an unconscious nod at Orwell.
To which an economist might respond that it all depends. You have a system with two constraints, one about spending too little and one about spending too much. Without more information it is impossible to say whether or not there is a market solution which satisfies both constraints. Nice fat grant needed to study the question at a proper depth.
There was also rather a tiresome article about the evils of outsourcing. Fair enough that it pointed to the various pitfalls & pratfalls of outsourcing, but no recognition at all that outsourcing is now a mainstream tool of management in both private and public sectors and that, other things being equal, it does make good sense to concentrate on core business and to get someone else to worry about the stuff round the edges. It is entirely likely that a catering contractor can make a better fist of running your canteen than you can. A catering contractor that can provide muscle, skills, standards and career opportunities that you are no position to match.
The trick being not to outsource your core business along with the bathwater.
In the case which is presently in the news, maybe the Olympics people should have contracted with the Census of Population Field Force people rather than some temporary staff agency. The Census people have plenty of experience of hiring large numbers of people for a short spell of boring, badly paid but important work and I do not recall them getting into the news in quite this way. But I suppose that is completely off message: public good, private profits better is the war cry of our present leaders. With an unconscious nod at Orwell.
# posted by Jim @ 1:32 AM 
