Posted by: apscott | May 15, 2008

Corporate Mergers: Human vs. Resources

Tying in from yesterday’s post, airlines are looking for ways to avert the effects caused by the surge in oil prices. However these aims have forced extreme confusion on the merger between major airlines US Airways and United Airlines. The costs of a merger extend far beyond the problems of partnership. While it may help the corporations at large, and I emphasize may, there is no real guarantee of any success in the deal.

As Susan Carey of the Wall Street Journal reports in her article today, “Rep. Jim Oberstar, the Minnesota Democrat who is chairman of the House Committee on Transportation and Infrastructure, opposes big airline mergers for many reasons. Among them, he said at a hearing this week, are ‘financial problems that could lead to failure in an economic downturn.'”

The dangers of this kind of merger could run as a detriment to the industry, which has a history of touch and go prosperity. However, worse results could ensue from such a deal. Carey states,

“Even if United and US Airways agreed on all the deal terms and their boards approved a combination, a merger announcement could spark a labor backlash if unions foresee downsizing and job losses or aren’t awarded raises. The proposal could face regulatory hurdles like the ones that caused the Justice Department in 2001 to disapprove a merger of the same pair. Mergers bring enormous integration costs, and these days, with airlines hemorrhaging money, preserving liquidity is becoming paramount.”

Moral Capitalism acknowledges that finding alternative resources is paramount. In order for our corporate economy to stay strong, its success will depend on this endeavor. However, companies should look to find these alternatives to succeed individually. Rather it seems companies like these airlines are looking to cover themselves through mergers in order to solve their crisis. In the end, layoffs cut jobs as merger integration costs rise and call for saving funds.

While a few may profit handsomely from such a deal, the business overall will likely do little better; certainly it will be no more capable of solving the bigger issue: sustainability. Human Capital must come first – in order for a corporation to seek sustainable growth, it needs man (or woman) power to support its endeavors.

Posted by: apscott | May 15, 2008

Fuel, Coconuts, and Algae?

Green Business practice has come a long way in the past decade. Cars can be driven through the byproducts of french fries. Bio fuels can sustain as alternative source for many automated items. Sustainability is key in developing alternative energy sources as the cost of gas and the damage to the environment has hit depressingly high levels.

Gas prices are affecting everyone, but the surges in oil prices have had a particularly adverse effect on the airline industry. With jet kerosene rising over $150 a barrel, there is no getting around this cost of transportation.

However, innovation and entrepreneurship have joined hands to find alternative sources for airline fuel. One of my favorite entrepreneurs, Sir Richard Branson, has suggested a number of options. From the title, you might be able to guess that coconut oil and algae were presented as viable sources for bio-fuel. However, it seems that the environmental implications might be equally severe as vast amounts of these resources would be necessary for any feasibility to occur.

Any real solutions are in the future. How far in the future is the question which will decide the well being of our environment and the sustainability of key industries like airline transportation. Regardless, keep your eye out for airline energy sources to make a splash on the markets as oil continues to pose more and more problems.

Posted by: apscott | May 14, 2008

What is a Corporate Donkey

The reason for starting this blog was to fuse my two interests: Politics and Business. As a college student, I saw scarce opportunity to bring to the arenas together and felt there would be no better way to express my interest in both fields than to start such a blog. You will see that the site is laid out into five distinct areas. These pages contain valuable sources of information on issues with which I am entirely concerned.

As a democrat, I find myself mostly concerned with social issues – human rights, social practice, you know – the anthropology of politics.

As a future businessman, I find myself constantly wondering how I will become the next millionaire prodigy.

Any business savvy individual can see these two ideal share a conflict of interest.

That’s why this site is here. I am in search of a way to become a successful businessman who doesn’t sell his soul to make an extra buck. Therefore I propose the idea of “Moral Capitalism” as a viable solution. This Moral Capitalism, at least how I define it, will focus on five distinct areas. In each of these areas (African Enterprise, Blue Innovation, Corporate Legislation, Green Business, and Human Capital) I will look to apply the ideals of a capitalist market to moral and democratic business enterprise.

I hope you enjoy and feel free to leave comments and/or suggestions!

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