Jim already answered and I agree with him but the following has another point of
view. Even if Jim was wrong, you're left with this problem...
>It has been for sometime now standard management theory that slow sales
>are answered with layoffs to cut cost and to maintain quarterly overall
>profit by increasing ahorterm profit margin over diminished sales
>volume.
>...
>Thus we have a system in which corporate well-being works against
>systemic well-being.
No. Corporate well-beign doesn't concur with systemic well-beign because
corporations belong to Capital. Here's an example...
>Suupose a management theory is adopted to favor cutting prices instead
>of instant layoffs, there is logic to suppose that this would be a
>preferred systemic option. The organization of labor for production is
>the fundamental asset of a corporation.
If this is to work systemically and not only for luxury goods which are consumed
mostly by rentiers and executives, wages would have to be sustained so that lower
prices would indeed increase demand. This means that profits would have to
shrink systemically.
Let's assume that Capital accepts to shirnk profits and lower prices for the sake of
long-term profits... As profitability is not equal for all businesses and sectors,
this
means that some producers will not only see their profits reduced but will simply go
in the red as the price at which their competitors sell goes under their costs. What
will happen to those producers? Why would Capital keep these loss-making
producers with no great future prospects? There will be shutdowns, layoffs, and
prices will be able to go up again.
You see Henry? As long as Capital continues to obtain that much profits, there will
be layoffs. The only thing that changes in management theory and accounting
achieves is to redistribute these layoffs to other businesses. The alternative is
regulations or unions which take management descisions away from the clutches
Capital.
You see Mark? I can also be deterministic and sound dramatic. ;-)
Julien
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