What Should We Call It When Government Arbitrarily Alters an Agreement?
SEPTEMBER 01, 1994 by SCOTT ALEXANDER
Mr. Alexander owns an industrial surface finishing supplier, Better Buff Co., in New Milford, Connecticut. He drew upon FEE materials to complete a bachelor’s degree in Operations Management at SUNY.
My profession involves me in an aspect of the manufacturing process—surface finishing—in which the opportunity for treachery abounds. My Macmillan Dictionary uses four striking words in its definition of the word treachery—willful betrayal, and violation of a trust. My job is basically two-fold: To assist in the selection and supply of appropriate polishing/buffng equipment and to consider for recommendation products and methods which might improve a production process. To betray my customers or violate their trust in either task would be treachery.
Surface finishing is an ancient art and mysterious craft. Doubt not that buffers and polishers played critical roles in the earliest of industries, from flint-knapping and arrow-fletching to amulet-shining and stone-carving. In my day, surface finishers perform key steps in the preparation and completion of innumerable objects for industry, technology, commerce, medical prostheses, and cosmetology. These articles include hammers, computer chip boards, credit card imprinters, artificial knees, and fingernail buffers. People who are fond of cooking or eating might be surprised to learn that a good quality spatula like a Dexter is a very highly engineered and refined masterpiece of metallurgy, plastics technology, woodcraft, machinery design, and surface finishing. Accomplished chefs and expert short-order cooks wouldn’t be caught dead flipping an egg without the right balanced, bended, beveled spatula.
Such products must meet the demands of the person purchasing them. The demands are seemingly endless! Even when a fry cook will settle for any old spatula in a pinch, he or she still expects one to be available at the closest dimestore or discount outlet and at a reasonable cost and right now! Purchasers also have at their disposal large numbers of advisers like advertisers, experts, know-it-all family members, and trendsetters who shape, influence, and increase their demands. These further demands must be met at a reasonable cost and right now!
Rarely will a purchaser settle so easily. Usually a product must be the right size, of the right material, the right quality, durable, clean, and pretty. Of course, it must also be available at a reasonable cost and right now. A superior surface-finishing method is used to prepare objects’ surfaces for fit or further processing like electroplating or to make mundane objects gleam and glisten like gems or clear crystals.
Therein lies a great challenge. Despite the notions some technocrats have of our society being able to categorize, quantify, and standardize just about everything, especially in manufacturing, I insist it can’t be done. I say there are two broad reasons for this inability: 1) long before the process of examination, standardization, and publication of approved (licensed?) products and procedures is completed, the initial demands change, and 2) the human beings who attempt to perform the several tasks of production at any level of capitalization do not do so uniformly from person to person nor individually from hour to hour! I really do believe that the way one person pushes a button is different from the way another pushes the same button, despite the obvious similarities.
All this notwithstanding, I daily deal with enterprises which I must not fail to help achieve fabulous finishes measurable to surface scratches of less than one one-millionth of an inch in depth. Results must be attained consistently and without regard to many constantly changing circumstances. If this process does not succeed, I may be suspected of having behaved treacherously, with having sent the inappropriate abrasive, perhaps through ineptitude, or perhaps to invalidly increase my profit. It’s a little scary!
Last Christmas-time, I was able to escape from all that by going gift shopping with my wife, Kathy, to an entire village of shops selling crafts-works. I could see that many people are appreciative and receptive of the talents of highly skilled and artistic crafts-workers. I could see why those wonderful articles are so treasured. They are beautiful, interesting, reminiscent, unique, whimsical—or all of the above. It’s almost transforming to watch a coppersmith fabricate a lamp using no modern tools, or a weaver in jeans, a baggy sweatshirt, or a depression-era calico dress staring into the loom and threads and s-l-o-w-l-y widening yardage, each crafts-worker doing his or her best to produce a quality product that will merit some purchaser’s trust.
As we made our circuit of these specialty shops, in search of unusual gifts, I envied the craftsmen and their products. An adoring public filled their shops, cooed with love over every misshape, broken warp or woof, or peculiar nick, each prized as proof of quality and precious personality.
Producers in an industrial setting where mass production prevails have essentially the same goal: to produce a quality product their customers will want. But they face a different problem—to produce quality products in quantity that are uniform. The time factor also presents a challenge; products must be available here and now.
Part-geometry-standardization required for mass production (accomplished, hopefully, through capitalization) is perhaps the single greatest accomplishment to meet that challenge. Increased productivity makes for increased wealth. Individual skills and performance make for individual productivity. Capitalization makes for more productivity. If the people I serve stopped working or were prevented from pursuing efficiency or employing their genius, we’d all need to return quickly to the handcrafts, weaving, and copper tinkering—or starve!
My experience pointedly illustrated a fundamental fact of the marketplace: An able buyer buys what an able buyer desires, if, as, and when the desire occurs. No amount of training or “paying dues” in the seller’s experience is even considered by the buyer. Some buyers want whimsy, a marked absence of uniformity. Others want uniform products immediately that can only be supplied through mass production—products of the right size, right material, and right quality as they see it.
So, it was back to the grind; holiday over, I went back to buff-mania! I resumed the fabrication and order-filling of quality finishing fixtures and furnishments. I also began the compilation and summation of the quarter-end and year-end figures for sales tax, use tax, employment tax, etc.
Most manufacturing costs are anticipated. They may be planned for by researching materials costs, labor and facilities costs, and such. Business men and women must know within pennies what their basic costs per hour are. They must have some idea regarding expected selling prices and potential profits.
One very large business consideration which unfailingly eludes the most brilliant business minds and mavens is the impact on operations and costs of a governmental regulation amended with little or no advance notice. It isn’t unusual to hear cost analysts or business leaders talk about damages in new tax rates or the need to “right-size” their enterprises according to a newly announced regulation which might affect already-bought-and-paid-for resources.
If a business person has a contract with another business person who arbitrarily alters the agreement, demands more money, more rapid remuneration, increased authority with less expertise—well, you get it! Wouldn’t this be a betrayal of the prior agreement? A violation of trust? Wouldn’t that be treachery?
Suppose the government does the same? Suppose it alters a previous regulation, fee, or tax, demands more money retroactively, more rapid payment, increased authority? I leave it to the reader to answer.