Mental shortcuts are shortcutting you
Mental shortcuts can be a recipe for disaster.
The incoming Trump administration campaigned heavily on imposing sweeping import tariffs. On the face of it, this sounds like a sensible idea, it makes local industry more competitive against foreign competition, plus the tariffs raise more revenue for the Government. What’s not to like?
Now consider the following stats:
- Research finds the US bore +90% of the cost of its own import tariffs, with Chinese firms not lowering their pre-tariff price.
- There is little to no evidence that tariffs helped employment, as the higher cost of production and the cost of retaliatory tariffs outweighed the benefit to protected industries (e.g. steel-consuming jobs vastly outnumber steel-producing jobs).
- US manufacturing output fell over 3% in the 12 months ending October 19. (JARS)
The Democrats tried to nullify the seductive appeal of said proposed tariffs by talking about the above findings.
But there were 2 main problems:
- The Democrats' credibility only lay with the converted - so Republicans were always going to dismiss it “Of course they’d say that”
- Imposing heavier tariffs supports the love affair with ‘making America great again’ so it was a readily accepted narrative and never challenged by the MAGA lovers because it supports their aspiration.
This shows how facts have far less impact on influencing thinking than a compelling and resonant story does.
Critical thinking requires effort. Accepting something at face value does not, so it’s little wonder the best storyteller won (who cares if the story is riddled with bullshit?).
The lesson here is the Republicans understood the mood of the nation better than the Democrats. As a result, their messaging resonated better with people where it mattered.
Taking this back to business, the organisations who are winning tend to be well informed by customer insights, and this is a trait that helps future-proof their business.
They know being out of touch with your audience can result in them getting fired by their customers.
(just like Joe - queue joke from The Apprentice…).
