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Most Russians could be rich, because their country is rich. Yet, it is possible to be poor in a rich country if you don't use information properly. 1% of the Russian population is rich. They become rich, not from earning profits by producing something or from understanding how to "make" ("create") money. Instead the few rich Russians that exist today, became rich transferring citizen socialist owned property to themselves without paying for it and without producing anything. Capitalism without law of social justice is theft. Socialism without private ownership and reward for effort is also theft.
Every Russian is from Missouri. They want to be shown before they believe. Every Russian will tell a Westerner that if the Westerner shows him how to make a money, the Russian will share some of it with him, later. This doesn't motivate a Westerner very much. A Westerner can himself make money and keep 100% and he doesn't have to help a Russian to accomplish that.
Not a single Russian would pay a Westerner to show him how to become rich. Russians, who are better educated than Americans in the sciences, do not yet understand the formula for creating wealth. Russians have never paid very well for brains and continue to value money, buildings, machinery and tangible goods much higher. Other nations understand this error. The British Tax Inspectorate recently purchased from an American firm a new tax information system for R1.500.000.000.000,00. What were they buying? A Russian would say ONLY information. Why did they do it? This system will permit the British tax Inspectorate to do its work for half the cost and with half of the 2000 employees it now uses. It was purchased in America.
American companies have little competition in the construction of sophisticated information systems for others nor in providing investment advice. America has become an information factory to the world. American companies are the undisputed leaders in providing financial information much as they were the first masters of mass assembly factory systems early in the century. Now the rest of the world produces the Products and America has become a service and information provider. Only in Russia is the value of such information underestimated.
American industries of all types are more than twice as productive as Japan or Germany. America has become the most productive economy. The main product of America has become information not products. Unfortunately for Russians, they do not understand the value of buying information, 'know-how" or advice. They wait to be shown free how to accomplish results.
Western governments are contributing to this Russian mistake by providing free advice. Why should a Russian buy advice from private Western businessmen about getting business investment when foreign governments give such information free? The answer is quite simple. It is the Western private businessmen that earn the money to give to these government in taxes, so that the government can give advice free. But Western governments have no knowledge how to make profits. They just know how to spend taxes. Just like the Russian government. Western governments have never earned a profit. Russians have not yet understood that when your life is threatened, whether physically or economically, you want the most capable doctor and not the doctor with the lowest price. So they wait for capital which does not come and refuse to consider to engage investment bankers to help them find capital for their businesses.
Technology isn't the only reason for success. Management changes have unleashed American creativity and innovation. This has allowed America to regain control of high-tech markets. This is also true in investment banking, finding capital, arranging joint ventures, privatization and international marketing.
But the U.S. advantage in information is irreversible because the dominance in these fields arises from uniquely American traditions of entrepreneurism, inventiveness, flexibility, lots of available capital, superior business knowledge and an inflow of brain power from other countries.
The value of brain power is poorly understood by Russian companies. Only by chaining together information with immediate knowledge of all markets, have information factories become powerful in answering economic questions. Information factories are now a larger part of gross national product of America than factories which produce goods.
The benefits include great increases in the metabolism of Western companies, the speed with which they can complete transactions; the power to obtain and react to information before competitors; the ability to cut costs by replacing entire cadres of workers with information databases; and the ability to eliminate the barriers of time and space with continual global communications.
One such information center alone links 400,000 computers, 95 data centers with 142 mainframe computers, and 15,000 satellite dishes located in 30 countries. It completes 51.2 million transactions per day and can store 49.7 trillion pieces of information, 45 times the content of the largest library in the world. Is it any wonder that such information power could solve the questions of capital for Russian industry. It should not surprise Russians that such information is not free in a market economy? Yet they reject this new concept.
Engineers in design centers in the U.S., Brazil and and Ireland can select more than 3,000 net-work module blueprints and combine or alter them to fit a need by moving icons around on a computer screen. As they work, an off-screen program invisibly calculates all the technical specifications, materials, and costs of the project and spits out a list when the design is done. The project, involving 20 million connections was completed in 2 ½ years. It was expected to take ten years. Access to capital markets is equally developed. If Russia wants to obtain capital to compete in the global economy it has no other effective option but to rent this force as an ally.
This information system quickly assembles technical experts from around the world. As many as 79 systems engineers and capital specialists, get involved, who never travel. In this way a single expert can contribute to more than a dozen projects in a dozen countries at one time. This sort of flexibility helps win business in almost all foreign countries, except Russia which still send a message..."Come to visit us". Companies in Europe can put 75,000 employees located in the U.S. at their disposal by utilizing the system to solve their problems.
Finally Western "information factories" train and inform a global work-force quickly. A few months ago 800 engineers, in 125 satellite-linked interactive classrooms sat in on a 3 ½ hour briefing by a major computer company, expert on a new recently developed computer software tools. That eliminates weeks of waiting.
In the past, when there was trouble in timely exchange of capital information, details of changes had to be delivered by courier, followed by conferences. The process took weeks. Now it takes just two hours. The documents are digitized on an optical scanner, transmitted via a turbocharged network and manipulated with customized software, in many countries simultaneously.
In some cases advice about capital is sold to companies that have not been fully organized yet. As business activity becomes increasingly dependent on, and defined by, good and fast information, it is a strategic necessity for Russian industry to recognize the need to buy information factories to reach their goals. Unless Russia wakes up, they may be out of Business.
An important way to measure the possibility that Russia will make economic progress, is to measure the number of Investment Bankers that are hired by Russian companies to represent them as financial advisors in locating capital. At the moment it seems clear that Russian industry prefers to experiment with on-the job education and learning from mistakes what not to do, rather than benefit from hiring experienced Western experts. The high cost of saving these consulting expenses can be seen in the results of the Russian economy.
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