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The Externality, and Ugly Blight on Brands, Products and Citizens [1]
['This Content Is Not Subject To Review Daily Kos Staff Prior To Publication.']
Date: 2025-03-06
I read here, that Jack Daniel’s CEO whines Canada pulling US alcohol off store shelves is ‘worse than a tariff’ and it occurs to me that this is something I studied in economics, to wit, externalities and these externalities are bearing out in marketing, the field I work in.
According to Investopedia:
An externality is a cost or benefit that is caused by one party but financially incurred or received by another. Externalities can be negative or positive. A negative externality is the indirect imposition of a cost by one party onto another.
The IMF Says:
Consumption, production, and investment decisions of individuals, households, and firms often affect people not directly involved in the transactions. Sometimes these indirect effects are tiny. But when they are large they can become problematic—what economists call externalities... In the case of pollution—the traditional example of a negative externality—a polluter makes decisions based only on the direct cost of and profit opportunity from production and does not consider the indirect costs to those harmed by the pollution. The indirect costs include decreased quality of life, say in the case of a home owner near a smokestack; higher health care costs; and forgone production opportunities, for example, when pollution harms activities such as tourism.
"What does this have to do with the price of tea?" you may ask. I am going to take a clue from Mardi Gras and contend that the Blight King and his bouncing Krewe of insulting officials and fans spewing ugly chauvinism for the fun of it have supplanted and superseded, in the minds of all kinds of decision making purchasers, the built up branding and marketing of companies and products, and the reputation of Americans generally.
Maybe you are old enough to remember when Hussein's Iraq invaded Kuwait and the long aftermath of turmoil in the Near East led to Arabs and Near Easterners becoming the go to boogeyman for media. It is now the turn of the ugly, ugly American. This external blight on reputation will have a long, and unpredictable tail and it is barely just beginning.
The Jack Daniel's item is just one little example of how harmful this particular externality is. A long series of made for (American) TV threats is received in a completely predictable way. "Did you just insult my country? Call it a 51st state? Threaten it economically?" A patriotic company owner may just say "F** that" right back, and then a marketer for said company will make marketing lemonade out of the outcome and say, "Look at this! We are proud of our country and you should be too, come buy our products and give the US the finger!"
Every US brand, product, service sold anywhere outside the United States faces an uncertain and unpredictable external cost. All are blighted, as it were by the Blight King and his Krewe. A decisionmaker evaluating an American financial consultancy cannot help but see the blight. How deeply does it hurt the value of anything that can be sold? A US sportsman playing in a non US league? Blighted, ugly, worth booing. An US tourist traveling abroad? Why go out of the way for haters?
The politics of any US individual, company or organization is irrelevant. The blight is spewed on us all and preys on us all. It has not only blighted the relationship between people here, blighted the politics till they are no longer competitive/cooperative but turned into some sort of moral/spiritual war, but turning into emotional blight on the health of any US organization.
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