By Steve Rathje
It’s true; there are manufacturing companies that are finding themselves more profitable in the middle of this recession, but not many. The reason for higher profits isn’t because of an increase in sales due to an uptick in the economy, as the President and the Democrats would have you believe, but rather a decrease in the financial obligations of the companies reporting. In other words, once sales has fallen to the point where the amount of money going out has exceeded that which was coming in, drastic measures have to be taken, concessions have to be made, spending has to be reduced, waste better controlled, and the labor force re-evaluated.
There aren’t very many businesses that haven’t been hit hard by this recession, some more than others, and those that are enjoying increased profits, for the most part, will tell you it’s because they no longer have the financial obligations to the people they no longer employ. Orders haven’t increased to boost profits, but rather the cost of wages and benefits that put the company in the red no longer exist, so naturally, although sales are down, the negative numbers have simply shifted to the positive side of the profit and loss statement.
Let’s take a moment and look at this from a layman’s perspective. Let’s say you take home $3000.00 per month, and when times are booming, $3500.00, due to overtime. Now let’s assume your financial obligations consume all $3500.00. Then, there comes a slowdown at work, no more overtime and $500.00 less to work with each month. Do you make up the difference with a credit card, or do you cut expenses to the level whereby the amount of money going out, no longer exceeds that which is coming in. Once you do, your personal financial statement goes from red to black, not because of more money coming in, but rather, less money going out.
Profit and loss is not an indicator as to how the economy is doing, but rather an indicator as to how the company is doing. The same holds true when the government tells us that 100,000 jobs were created in the last quarter, without telling us that 400,000 people signed up for unemployment benefits during that same period in time. The bottom line is; the government isn’t telling you the truth. They want us to believe that there is a light at the end of the tunnel without telling us it’s the headlight of a locomotive coming right for us.
Being disingenuous, regardless of who is telling the story, isn’t what is going to put us back on our feet, but rather, the honest to goodness truth which should have been told during the State of the Union Address. We were never given the actual State of the Union because if we had, we would have been reminded of the 45 million Americans unemployed and underemployed, how the value of the American home continues to fall and how millions of Americans continue to lose their homes in foreclosure. We would have been told how the American dollar is losing both value and credibility, the threat of terror and nuclear war that stands at our door step, the porous borders to our south, the millions of illegal aliens, the rise in fuel and grocery costs, the number of jobs that daily leave our shores, how tax cuts are overshadowed by tax increases, how our freedom is being compromised and our liberty taken advantage of.
There really wasn’t a State of the Union address, but rather, the State of the Presidency address. The President showed no ability to stand upright and face our problems head on, but rather, he chose to bow and concede defeat to the larger than life problems our country is experiencing. Rather than mirror that which does work and tell the American people about the drastic measures he will be taking, the concessions he will be making, the amount of money he will no longer be spending, the waste that he will be better controlling, and the labor force he will be reducing, this President chose to offer a fairytale to those he felt couldn’t handle the truth.
Steven R Rathje Founder/C.E.O.
International Procurement Services, Inc. and
The Genesis Group, Inc.
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