Our economy is designed to give maximum return on short-term investment. In stable times it creates goods and services cheaply and rewards short-term investors generously. Managers who fail these measures are at risk of being replaced.

Economic resilience is not valued. Four examples follow.

• Tying up money in supplies and inventory is considered wasteful. Get what is needed just in time. Don’t consider the possible disruption of long, fragile supply chains.

• Don’t tie up money in reserve manufacturing and processing capacity. It would cost more than it would pay to be able to, say, shift packaging as markets change.

• Get labor as cheaply as possible. If the work can be moved, send it overseas to places with large populations of poor people and high risk of epidemic disease. If the work can’t be moved (perhaps it’s a perishable crop), find workers without protection who can be exploited. Eliminate unions, minimize wages and protections that cost money, so the working public has no money in reserve. Death and distress are concentrated in low-income, disadvantaged populations, but those aren’t issues for investment managers.

• Convert corporate profits into investor profits as quickly as possible, leaving the company relatively weak in good times and broke when times turn bad. The government will provide bailouts. Privatize profits and socialize risk.

Our unregulated economy can provide goods and services cheaply, but not reliably. If we want resilience in our economy and workforce, we will impose targeted regulation and realistic minimum wages.

Wayne Myers

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