<== Site of the Week for 2010-03-01 ==>

Stop Too Big To Fail

Economic failure is about relative size and not overall size. For example, when a company's expenses exceed income, it falls into the red and operates at loss. This is true of all companies big and small. Companies can borrow money, but when the debt becomes higher than assets it is bankrupt and likely to fall into insolvency.

The law of diminishing returns dictates that, as businesses saturate a market, the returns from investments in the market decrease. So the idea that businesses should seek to grow until they are too big too fail is foolhardy.

Unfortunately, business leaders have been enamored with the idea that they could engineer perpetual prosperity with really big companies. This preference for big has infected all areas of the economy from banks to insurance and health care.

Stop Too Big To Fail is a site by Consumers for Competitive Choice that seeks to stop this TBTF thinking that has infected Washington and Wall Street. The company seeks to reduce the leveraging of big companies and seeks ways to break down big into smaller manageable chunks.

You can follow the effort on Twitter.