Acting like the government

06Jun08

I’ve often heard the idea that state and federal governments can’t go out of business, since they can always raise taxes until ends meet. If people don’t like it, too bad — they’re stuck with the situation until the next election. However, the same strategy doesn’t work for private businesses. The airlines are a great example. Fuel costs going up? Just raise fares another 20%. Of course, this hurts them in the long run, since there actually is competition for air travel. Southwest seems to be the only airline that understands this simple truth: behaving like the government doesn’t work when people actually have a choice in the matter.



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