The Management Problem of the 80's

Recent economic problems have had little to do with ideology, and changes in governments will not cure them. Rather, economic life is constantly changing, and economic policy must also change to adapt. No longer are there separate standards of living for blue- and white-collar workers and professionals. There is now a common claim from the various classes for goods and services, which has strained private markets and public budgets. This has fanned inflation. There is a life cycle for industrial enterprises; corporations in older countries are not as vigorous as in new industrial nations. As nations age, the people do not work as hard and must be paid much higher wages which outstrip productivity increases. New industrial nations do not have this problem. The market no longer is the motivating force of the economy. Rather, corporations control their prices and costs, and the exporting nations control oil prices, for example. This has hindered monetary and fiscal policies in coping with inflation and instead has bred ''stagflation.'' These changes have broad implications.