Seven weeks, and plenty is happening on the geo-political front. Everyone has heard of the Wikileaks dump and the wiretapping of Trump Tower by the Obama administration during the campaign. A civil war has been reported between Trump’s nationalists and the cuckservative moderates sprinkled in the mix, and the revised travel ban looks like it may stick. We’ll see how these shake out.
Closer to home and with more immediate impact are the latest rumblings about job creation projections and Obamacare Lite. Various mainstream media sources appear to be grudgingly acceding that a pro-American stance by the national government might actually help create jobs for … Americans. The horror…
The latest “repeal and replace” Obamacare Lite plan being pushed around by congressional cuckservatives looks a lot like … Obamacare. Instead of the IRS levying penalties, the insurance companies get to do that in the form of even higher premiums. The tax credit versus subsidies issues is just shoving the data around in different ways so that different people get to jockey for the same useless nothing. So far, other than initiatives proposed in the State of the Trump speech last week, nothing substantive has emerged which would make much difference with the top four ways that Obamacare cripples small businesses. I don’t see this as a failing of the Administration, but instead a clear signal that much of Congress continues to virtue-signal for their globalist masters.
ZeroHedge released a great cartoon on the topic yesterday. Yep.
In the world of business, an expanding pie model appears to be taking shape, versus the fixed pie model we’ve seen for about a decade. In an expanding pie model, the pie gets bigger, allowing more pie for everyone. In a fixed pie model, everyone is fighting over whatever scraps they can find and hoard. This is also known as an abundance mentality versus a scarcity mentality. People who three months ago were playing all their cards close to their chest are now starting to relax and get in the game more, looking for ways to cooperate to create even greater opportunities. It is a beautiful thing to behold.
In the world of technology, supply chains are going to be an issue for a long time. We discussed this way back on week one. Technology products depend on a vast array of chips and components, only a tiny fraction of which are made here in the US. Of the worldwide chip and support silicon supply, very little foundry capacity is domestic anymore. Check out this list from Wikipedia, and see how few are actually domestic. Even that list is deceptive, as many domestic foundries support internal R&D, limited production runs, or specialized needs such as defense-related projects that require US sources. A big clue is that most of the US foundries on the list have corresponding overseas foundries as well. “Made in the USA” will continue to mean “Assembled in the USA” for a long time. The good news is that once the multinationals, or midsize domestic companies, begin investing in domestic foundries, then the nature of technology will cause a leapfrogging of process capability for high-end parts. This will cause a gap to open up, where high-end parts are made domestically, but low-end, low-margin popcorn parts will continue to be made overseas while domestic capacity lags behind.
In software news, for decades companies have relied on H-1B visa sweatshops to throw bodies at large, complex projects. Decades ago, a great book, “The Mythical Man-Month”, was written on the topic of large teams. Basically, if you want to finish a software project and have it done well, then studies have shown that smaller and more efficient teams are better. Conversely, adding more bodies to a bogged-down project can actually bog it down more. However, if the goal is to create large, complex projects, where no one in the trenches can really tell what is going on, and leave gigantic gaping security holes while you are at it, H-1B visa sweatshops make perfect sense.
And now, we wrap back around to Wikileaks and scrum-mastering. We’ll drill into that topic more in a future article. The good news for small businesses is that small, effective teams, especially those that leverage vast amounts of open source software, can run laps around large companies whose business model has been to leave giant gaping holes in locked-down, bloated, proprietary software that needs massive processing power to swipe your Tinderellas while spying on you.