The Difference Between Staples and the Federal Government

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Staples is taking a lot of flack due to making its employees adhere to the 25 hour work week. Many politicians including my own congressmen seem to be chiming in on how to run Staples. Both seem to say that the 25 hour work week has nothing to do with Obamacare, even though a recent small business survey seemed to indicate a growing concern with health care costs, and that health care costs are still rising a lot.

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Lets note some differences between Staples in the Federal government.

* The federal government: has the guns, and forces people to give it money.

Staples: has to struggle with what customers want and their changing needs in a ever changing industry environment and to produce a profit and enough cash flows to maintain business operations. In short it must make customers happy or it won’t be around.

*The federal government: can borrow money by issuing treasuries. It can go into perpetual debt, and if there is ever a issue the Federal Reserve will print money out of thin air to buy government debt. Either way the citizens are on the hook either through taxes or inflation.

Staples can borrow money by issuing bonds. The bonds coupon rates will be floated based on the market. And individual investors can buy the bonds with the risk of default. If the company goes bankrupt, the bond holder will receive as much money back as possible through their liquidation. Any stock holders will get what is left. Just the bond holders and stock holders are effected in this scenario

Obama’s budget is $4 trillion dollars btw, and the CBO predicts the biggest budget cost in a decade will be interest payments on the debt. There is no way to conceptualize $4 trillion dollars. Maybe government employees should be more concerned with costs and operations of the Federal government.