Monday, December 03, 2012


Does anyone remember the old "payola" scandal of the '50s? Disk jockeys were paid to play certain tunes to make them seem more popular than they really were. Several people went to prison over those scams. Today, the golf industry has taken payola to new heights with spiffs from manufacturers to professionals and obviously to some media folks.

Here's how it works in private business. A new manager took over a shipping department and found the previous manager had been receiving payola from several truck lines whose sales reps had taken his predecessor to lunch regularly. In return he favored all of them with business instead of concentrating on a few to gain maximum discounts for his company.

Check out a doctor's office about lunch time and watch pharmaceutical reps haul food in to feed the office staff. Somebody has to pay for all of that expensive advertising the pill pushers do. The rising cost of gasoline, taxes and food are not the only factors contributing to the current outburst of inflation. Old fashioned payola is taking its toll, too.

Receptionists and purchasing agents are treated to spiffs in spite of rules most companies have to prevent such hanky panky. Payola is a big problem for small business because the cost is passed along in the form of higher prices. I forgot! The Fed says there is only 2% inflation. If Mr. Bernanke said it, it must be true.

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