William_Lazonick@uml.edu

Phone: 617 233-2634

Office hours: Mondays, 3:00 PM-5:00PM, or by appointment

Course Description:

Regional development depends on the activities and performance of various types of business, government, and civil-society organizations. The term “organizational dynamics” refers to the interactions among different organizations as well as among participants within particular organizations that enable these organizations, individually and collectively, to develop and utilize their resources to achieve “superior performance” (which is itself in need of definition). In this course, we will ask who starts organizations, how organizations “learn” and grow, and what determines the distribution of the costs and benefits of organizational success – or failure. This course focuses mainly on

business

organizations. In a modern capitalist economy, the resources available to, and the potential impacts of, non-business – governmental and civil-society – organizations depend on the performance of the business sector. To interact with business organizations in ways that promote regional development, those working in governmental and civil-society organizations must understand organizational dynamics in the business sector. In particular, we seek to understand under what socioeconomic conditions and with what institutional support business organizations will generate higher quality, lower cost goods and services while contributing to “sustainable prosperity” – stable and equitable economic growth. Organizational Dynamics in Regional Development

and his new book

Sustainable Prosperity in the New Economy: Business Organization and High-Tech Employment in the United States (Paperback)
by William Lazonick

10. “There has been significant progress in tamping down the insurgency in Afghanistan.”

9. Afghans want the US and NATO troops to stay in their country because they feel protected by them.

  • Fact: In a recent CIA director Leon Panetta admitted that there are only 50-100 al-Qaeda operatives in Afghanistan! The US is mainly fighting two former allies among the Mujahidin whom Ronald Reagan dubbed “freedom fighters” and the “equivalent of America’s founding fathers:” Gulbaddin Hikmatyar and his Hizb-i Islami, and Jalaluddin Haqqani and his Haqqani Network. These two organizations, which received billions from the US congress to fight the Soviets in the 1980s, are more deadly and important now than the ‘Old Taliban’ of Mulla Omar. The point is that they are just manifestations of Pashtun Muslim nationalism, and not eternal enemies of the United States (being former allies and clients and all). Hikmatyar has roundly denounced al-Qaeda.

An example of how major policy is based on false reality.

But the really hard stuff lies ahead: taking things away. We are leaving an era where to be a mayor, governor, senator or president was, on balance, to give things away to people. And we are entering an era where to be a leader will mean, on balance, to take things away from people. It is the only way we’ll get our fiscal house in order before the market, brutally, does it for us.

In my book, the leaders who will deserve praise in this new era are those who develop a hybrid politics that persuades a majority of voters to cut where we must so we can invest where we must. To survive in the 21st century, America can no longer afford a politics of irresponsible profligacy. But to thrive in the 21st century — to invest in education, infrastructure and innovation — America cannot afford a politics of mindless austerity either.

The politicians we need are what I’d call “pay-as-you-go progressives” — those who combine fiscal prudence with growth initiatives to make their cities, their states or our country great again. Everyone knows the first rule of holes: When you’re in one, stop digging. But people often forget the second rule of holes: You can only grow your way out. You can’t borrow your way out.

One of the best of this new breed of leaders is Atlanta’s inspiring mayor, 41-year-old Kasim Reed. A former Georgia state senator, Reed won Atlanta’s mayoral race in December 2009 by 714 votes. The day he took office, Atlanta had $7.4 million in reserves, an out-of-control budget and was laying off so many firefighters there were only three personnel on a truck, below national standards. A year later, it has $58 million in reserves, and Reed has a 70 percent approval rating — which he earned the hard way.

Reed started his reforms by enlisting two professionals, not cronies, to help run the city: Peter Aman, a partner at Bain & Company, a consultancy, to be his chief operating officer; and John Mellott, a former publisher of The Atlanta Journal-Constitution, to lead a pension review panel. Atlanta has 7,000 city employees, but today, says Reed, “you can’t hire a receptionist” without it “personally being approved by Aman.”

Then Reed tackled the city’s biggest problem: runaway pensions, which were eating up 20 percent of tax revenues and are rising. In the early 2000s, the police, fire and municipal workers’ unions persuaded the city to raise all their pensions — and make it retroactive. So, between 2001 and 2009, Atlanta’s unfunded pension obligations grew from $321 million to $1.484 billion. Yikes.

Reed couldn’t cut existing pensions without lawsuits, but he cut back pensions for all new employees to pre-2000 levels and raised the vesting period to 15 years from 10. When union picketers swarmed city hall to protest, Reed invited them all into his office — in shifts — where he patiently explained, with charts, that without pension reform everyone’s pensions would go bust.

By getting the city’s budget under control, Reed then had some money to invest in more police officers and, what he wanted most, to reopen the 16 recreation centers and swimming pools in the city’s most disadvantaged neighborhoods, which had been shuttered for lack of money. “People were shooting dice in the empty pools,” he said. Local businesses have now offered to finance after-school job-skills programs in the reopened centers. Cut here. Invest there.

Reed combines a soft touch with a hard head. I like how he talks about both Atlanta and America: “We are not going to be what we have been for the last 50 years if we don’t change, and everybody in a position to have more than two people listening to them needs to be saying that, because the time we have to make the adjustments is running out. We need to get on with it. Whether it’s the deficit, education or investing in young people or immigration — we are not tackling [them] in the fundamental ways required. We’re just doing it piecemeal. We’re just playing and surviving. And we need to be very clear where just surviving takes you: it takes you to a lifestyle of just survival.”

In a recent address, Reed elaborated: “The bottom line is that for the country to do and to be what we have been … there must be a generation tough enough to stick out its chin and take the hit. … It is time to begin having the types of mature and honest conversations necessary to deal effectively with the new economic realities we are facing as a nation. We simply cannot keep kicking the can down the road.”

The problems here are many, but core is that investment tends to help the rich and cutting tends to help – the rich. Not necessarily but by not addressing the issue of who got the lion’s share in the last two decades he is suspect. We will see many “presentations” like this that are really tricky which will continue to take the lion’s share until we break apart from anger and anxt.

— Republicans say they will follow “the people’s priorities” when they gain power on Capitol Hill next month. Yet when it came to tax cuts for the wealthy and other top issues that dominated the just concluded lame-duck Congress, the GOP either defied what most Americans want or followed their will only after grudging, drawn-out battles.

Polling could be very important in this session, well done polling, and then strong articulation of the themes and results.


ENSO animation produced by the Australian Bureau of Meteorology.

One you’ve seen this, no forgetting.

Simone Weil

December 22, 2010

“ours is an age of many illusory responsibilities, and very few real ones.”

Simone Weil

December 22, 2010

“Ours is an age of many illusory responsibilities, and very few real ones.”