Subsidies are ultimately doping
All to often, governments try to prevent the decline of industries and/or companies with subsidies, i.e. tax dollars. The decline is usually a result of unprofitable operations, for which there are two major reasons:
- Competition from abroad, which provides the same product and/or service at a better price.
- The availability of a new product and/or service, which is more popular with consumers.
Subsidizing the 'old' is tantamount to doping: Just as doping uses drugs to improve athletic performance, subsidizing uses money to improve business performance. In both cases the goal is to obtain an unfair advantage by distorting the competition. There is no room for that in a globalized economy.
By subsidizing, governments only procrastinate the necessary change. Instead of subsidizing yesterday's economy, governments must set the stage for a future-proof economy: Invest in education, research and retraining.
Everybody is good at something. The task is to find out what you're really good at, where you can add value, where you're competitive.
Living in the past is not an option and yesterday's laurels won't distinguish tomorrow's winners!