Sunday, September 11, 2016

EU Policy Laundering - Tax the Dinosaurs

The Hegemon is sending out minions to test the waters on snatching up low hanging fruit.  Now that the ex nihilo credit game is over, Hegemon minions are ordered to snatch up fruit before the trees die.  Multinational dinosaurs are the target, to mix metaphors woefully.
BRATISLAVA (Reuters) - Multinational companies should refrain from tax-avoidance practices and pay their fair share, the head of euro zone finance ministers said on Saturday in a new endorsement of the European Union's fight against tax-dodging.
The worse these entities perform, the more the hegemon goes in for the kill.  It must be galling for people like Howard Schultz to be lectured by some twerp who has never worked a day in his life, upon Starbucks paid taxes his government career has depended, on Howie doing his fair share.  It is some consolation to know the minion, when the process is advanced, will be disposed of by the Hegemon like a boogered Kleenex.

We see at the same time the dinosaurs dying, the masses fighting over the carcasses, and an alternative live emerging clearly.  I teach business in that authentic if alternative world.

Feel free to forward this by email to three of your friends.


Anonymous said...

"Starbucks is not, nor ever has been, a viable business model."

Please elaborate. I actually viewed Starbucks as a "specialty retailer": offering a "fancier" cop of coffee at a higher price that people wanted - They were essentially "competing on design" in coffee.

John Wiley Spiers said...

Unh... that is what I get for writing a post in the middle of the night. I thought I deleted that line. Thank you for noting it for me... you'll see I now deleted it.

My basis has to do with a meeting back in the 1980s where my opinion formed, based on facts Starbucks was obliged to reveal when getting permission to open its first coffee shop in an airport, SeaTac, back in the 1991. I thought I might be able to substantiate it last night, but when I checked for some facts and figures, no... so i figured I'd riff on that another time. Ooops!

There is the less interesting point that Starbucks did the same roll-up of the corner coffee house that Petco did with the corner pet shop, and that is not sustainable. The finance heretofore, in the measure Starbucks is using ex nihilo credit, is over, but you are right, they are coffee sellers competing on design. But then there are countless other coffee shops which do so as well.

Schultz tested a concept on his own dime while working for Starbucks, sold the proof of concept to his employer, Starbucks, and then took over and borrowed ex nihilo credit to expand the market where there was none before. I doubt many if any mom and pop coffee shops have been run out of biz by Starbucks. If anything, the market Schultz built benefitted any independent in the field.

And further, in each location, a Starbucks does have drawbacks with which an independent can compete.


John Wiley Spiers said...

Unh... there I go again... I recalled the 1980s, but the meeting was in 1991... sigh... I need a vacation....


Anonymous said...

"sigh... I need a vacation...."

John, maybe you need ... a cup of coffee! Late evening and too early morning blog posting can be weird for me too before I have my fill of coffee and I'm fully awake. LOL.

I think the Keurig coffee machine guys, with their plethora of different single serving coffee K-cups, are specialty for the at-home coffee market. They sell both the coffee machine and the coffee K-cups, so maybe that is an improvement over the Starbucks business model?

John Wiley Spiers said...

See, that is he nice thing about competing on design...Keurig is just coffee too, but meets the needs of another market, and thus price blind. Innovators compete on design, not price. And room for both and more.