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Deconstructing Adam Smith

November 1, 2011

I wish life could be

Swedish magazines.

-Iggy Pop.

A pox on major media, commercials and the mainland perception of life beyond our shores.  We’ve been force fed a diet of “buy-this-and-you’ll-be-happy”, along with a constant stream of news feeds which reinforce we are The Greatest Country On Earth, with the implication Every Where Else Sucks.

I have news for you.

It doesn’t.  Large portions of the population live well – and have lived well for over a century, like in Singapore and Hong Kong.  I have personally seen more Maybachs (top of the line Mercedes Benz coachbuilt limo at $400,000 a copy) pull up to the front door of the Grand Hyatt in Seoul than I have seen the the rest of the world – combined.

I believe our average standard of living is on decline in the US, and our recent Asian travels serve as confirmation.  At least they have street cleaners in Singapore; compare that to Detroit!

I’ve performed a root cause analysis, and have the individual to blame:

Adam Smith, the founder of Division of Labour.  By separating tasks into discrete elements, one could produce more uniform products.  Division of Labour increased productivity – at the expense of two very important things:  Variety and skilled trades.

There’s something very wrong with the photo below.

Division of labour has simplified the process of copying things; these are perfect copies of iPod Shuffles for $8.99.  No skills required.  Just cheap hands in a third world country.  Division of labour also concentrates intellectual property in the hands of the corporation – transferring value from skills (which a corporation cannot own) to an idea (which can be bought and sold).  Major corporations make employees sign intellectual property clauses, which effectively say that if you have a great idea while collecting a paycheck from us – it’s ours.

More simply stated – all your minds are belong to us.

There’s something really right with this picture:

Look cloesly at the labels.  No Bud, Bud Light, Miller, Miller Light, Coors or Coors Light to be found at this alfresco pub.  Only Stella as a representative of the worlds largest brewery.  Variety.

It hit me whilst walking Chinatown in Singapore that the ideal for living in this postmodern world is to take back one’s intellectual property, to exist on skills which cannot be exported to a Cambodian sweatshop.

You’re a professional and not worried, you say?  Think again brothers and sisters; India is graduating doctors, lawyers, engineers and accountants at a torrid pace – professionals willing to work for $1.25 an hour on the end of a T-1 line.  A storefront in the US and a back office in India.  Don’t believe me?  Next time you call a help desk, ask the person on the other end staring at a problem solving flow chart (the intellectual property of the corporation) where you’re calling.  I guaran-frickin-tee you it’s not within the Unites States.

In this postmodern age, there is no job security. I know of an entire division of a major corporation which is being laid off – not becuase of poor sales or performance, but becuase of a contract conflict.  People with stellar performance – with a quarter centrury of experience – are being jettisoned in an effort to retain shareholder value.  Here’s a check.  Buh-bye.

I worked for healthcare – to insure my wife and children (who have pre-existing conditions) were covered.  I’ve made decent money, I’ll not deny that, but I railed at the idea that I’m not free to strike out on my own, to take back my skills and intellectual property.   I loved the idea of the shophouse, a business and a home all rolled into one, but I couldn’t make that happen due to the need for healthcare.  I’d become a virtual slave to Adam Smith’s machinations.

We figured it out, though – or more correctly, the Pheebs figured it out by turning Adam Smith on his ear.  She’d taken a job locally which has the same health benefits as we now have.  This frees me up to start a business.  By dint of luck, we’d bought a house zoned Historic Neighborhood Commerical, which in Key West jargon means we bought a shophouse without knowing it.

We’ll not get rich in this fashion, but we’ll be able to pay the bills without being at the mercy of a Board seeking to satisfy faceless shareholders.

Company papers are filed, we’ve a legit Florida business license.

Wish me luck.

 

 

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6 Comments leave one →
  1. November 1, 2011 7:20 am

    LOVE YOU:) See you soon…..

    Pheebs

  2. November 1, 2011 8:11 pm

    El Chucko–
    We have exactly one Maybach here in Huntington, WV. One. Uno. Don’t rule us out, yet.
    As for the business license/zoning in Key West…my lips are making the same move they make when I drink really, really bitter lemonade. They are puckering.
    Now is not the time to go into business. Trust me on this one.
    Unless, of course, you make those iPod clones in your dining room.
    If that’s the case, then “game on”.
    Greg P. In WV, who will be on Key West all this weekend, dammit. About time…

    • dangerboyandpixie permalink*
      November 1, 2011 8:54 pm

      Au contraire, mon frere!

      KW hotel occupancy is hovering well north of 90%, up a good 27% over last year, unemployment is down around 5%, and there’s a shortage of hospitality staff across the island. One gets in near the bottom of the business cycle, trims expenses to profitability, and rides the curve.

      KW has been down since Wilma; the fear associated with traveling to Mexico has moved the Cancun and Cozumel parties our way. Last two Spring Breaks were off-the-hook crazy, this one looks to be a madhouse.

      This is the best time to get into the game.

      From the guy who got his engineering business out of the auto industry 4 years early,

      Chuck.

  3. Len Bloom permalink
    November 5, 2011 3:20 pm

    Wish you all the luck in the world, coming from a fellow business owner that is not on the right end of the shrinking economy (restaurant owner).

    What is your plan if it’s not being too blunt to ask?

    • dangerboyandpixie permalink*
      November 5, 2011 6:22 pm

      A restauarant would have a tough go of it these days. We’ve had a few open and close in Key West over the past three years; most did not understand the market.

      I’m planning on following the modus operandi of most people who work in Key West, that is to have more than one revenue stream so as to insure success. Everyone I’ve spoken to has indicated the key to success is to have a strong local following, as one does not make it off the tourist trade alone.

      I’m considering the following:

      – Bicycle tours. At $30-35 a head for a two hour tour, this is a low overhead business with a nice profit margin. It’s totally seasonal, however, so I have to make hay during the 4 months of high season. I like Key West, storytelling and bicycles, so this is a nice confluence for me.

      – Lifestyle shop. Fixed gear bikes, skateboards, stand-up paddleboards and associated surfwear. There’s only one shop left in town which does this; if I ran it in conjunction with the bike tour business, the two would complement each other nicely. Between the Pheebs and I, we have about 15 years of retail experience.

      – Motorcycle shop. I can get three product lines right off the bat, including a scooter line. The key to success would be rentals and tours; the ‘hook’ being rental of sidecar motorcycles. This is the highest revenue generator of the bunch, but requires the most investment.

      – Kitchen and bath design. Virtually no overhead; I’d sub out my services to the architecture/engineering community along with the local contracting community. Designing kitchens and baths is easy and interesting for me; the challenge in KW is working with smaller than US-standard spaces, and I know how to do that.

      – Small commercial/residential energy services. No overhead, can run in conjunction with kitchen and bath design. I’ve done this for nearly 15 years for large companies, and I’ve saved some of my neighbors up to 50% on their utility bill.

      I don’t have to make the decision for another month, with a start date of about Feb 1.

  4. Len Bloom permalink
    November 9, 2011 4:50 pm

    Wow, I truely wish you the best with it.

    If the economy doesn’t get any better around here I’ll soon be available to be the most loyal, hardest working employee you could ever hope to have.

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