Thursday, November 24, 2005

Happy Thanksgiving!

Thought for Today:

Thanksgiving is a typically American holiday. In spite of its religious form (giving thanks to God for a good harvest), its essential, secular meaning is a celebration of successful production. It is a producers' holiday. The lavish meal is a symbol of the fact that abundant consumption is the result and reward of production. Abundance is (or was and ought to be) America's pride ...

Original Source: The Ayn Rand Letter, Vol. III, No. 23, "Cashing in on Hunger"
Web Source: Charlotte Capitalist Blog

Wednesday, November 16, 2005

Econ 200 Telecourse - Term Paper Instructions

Fall 2005


As indicated in the syllabus, there is an optional term paper for this course. The paper will be worth 150 points, the same as the mid-term and final exams. The paper is optional and may be submitted in lieu of the mid-term or final exam. You may also elect to take both the mid-term and final exams AND submit a paper - in this case the two highest grades of the three will be recorded and the lowest discarded.

The paper, for those who elect to do one, will be due no later than noon on Wednesday December 7, 2005. Papers may be handed in prior to this date.

The topic of the paper must be chosen from one of those listed below:

- PRIVATIZATION OF SOCIAL SECURITY. For this you can either examine the present system and present ECONOMIC arguments in favor of keeping it as is or abolishing it outright, or you can analyze one of the current plans for reform and give arguments for accepting or rejecting it.

- PRIVATIZATION OF GOVERNMENT ACTIVITIES. Pick one of the following economic activities (all of which are provided mainly by government but do have some private sector counterparts) and explain how it could be privatized (i.e., sold to investors, sold/given to employees of the entity, given to taxpayers, etc.), the economic effects of the choice of privatization and the economic benefits/losses of having the free market provide the goods/services rather than the government. The activities are:

U.S. Postal Service
Air Traffic Control System
Tucson Water
Public School System (K-12)
Pima College
University of Arizona
National Parks, Forests and other lands managed by the U.S. Bureau of Land Management

- HIGH OIL PRICES AND OIL COMPANY PROFITS – What is causing the high prices; should oil companies be criticized or penalized for their current high profits; how will the market solve the problem of high energy costs; what is the difference between government and market approaches to high energy costs; which approach to the current "crisis of high prices & energy shortages – the market approach or the government approach is best and WHY?

After choosing a topic from above and researching it, take a stand, on one side or the other, and present economic arguments for or against the position you have chosen.

While political, sociological, philosophical, etc. views/ideas/effects can be included in the paper the main thrust MUST be on economic factors and effects. THIS IS TO BE AN ECONOMIC ANALYSIS OF THE PROBLEM FIRST AND FOREMOST. You are to choose an area within the scope of the assignment, define the problem, as you see it, and, using Economic Reasoning, provide a clear cut solution to the problem.

Minimum formatting requirements are as follows:

• The paper must be typed on 8 1/2" X 11" paper.

• Material drawn from outside sources must be cited using a recognized footnote format.

• Each paper must contain a bibliography showing all sources from which information was obtained.

• Pages are to be numbered and stapled (unless submitted electronically) together in proper order.

• Paper must contain a cover page showing title of paper, student's full name and date submitted.

• Points will be deducted for errors in spelling and grammar.

Students' must do their own research and writing (typing can be done by another). No credit will be given for plagiarized papers.

Minimum research requirements:

• The bibliography must contain AT LEAST ten (10) books, articles, internet sites or video/audio tape sources.

• Non-print media sources (i.e., video, audio, radio, TV or other electronic media - other than computer databases and the World Wide Web) may be used for research but these may not exceed one third of the total research sources used.

Monday, November 14, 2005

Peter Drucker – 1909 – 2005

Peter Drucker, world renowned management guru, died this past Friday, November 11th, at the age of 95.

Born in Vienna in 1909, he received his doctorate in public and international law from Frankfurt University in 1931. In Frankfurt he worked as a financial reporter for the Frankfurter General Anzeiger newspaper. In 1933 he fled Hitler's Germany and moved to England where he worked as a securities analyst for an insurance company. In 1937 he came to the United States and accepted a teaching position at Sarah Lawrence University.

Drucker is best known for his books and articles on modern management. His writings were not only ahead of their time when published but remain relevant classics to this day.

I remember reading a piece by him in the Wall Street Journal in the 1970s in which he pointed out that Karl Marx's dream of worker ownership of the means of production had been realized in the United States of all places. This was achieved not through the nationalization of industry as in the then Soviet Union and other communist countries nor through utopian communities where all productive resources were owned in common with "each taking according to his needs, and each contributing according to his ability" as envisioned by Marx. Rather it was businesses competing for workers with a combination of pay and retirement pensions and funding the pensions with investments in corporate stocks. In this way the majority of stock, which represents ownership in corporations, in American corporations came to be owned by workers indirectly through their pension funds. Today, thanks to IRA's, 401(k)'s, 403(b)s and other worker directed retirement accounts the percent of corporations owned by the workers of America is probably greater than when Drucker described this in his article.

Drucker was also ahead of his time in stressing the importance of worker's training and knowledge in modern production. "Human capital" as we now describe it. Drucker himself was a part of the great wave of human capital that fled Nazi dominated Euope and flowed into America in the 1930s and 1940s. Hundreds of scientists, academics, artists, filmmakers, etc. fled to the U.S. to escape Hitler's wrath and the U.S. economy benefited greatly from this in migration of foreign knowledge and talent.

Drucker has left behind a couple of generations of managers trained in his innovative ideas and, through books and articles he has left behind, he will continue to influence future generations of managers. Despite his passing, the American economy will continue to employ his insights and ideas to continue its remarkable growth.