Geos bankrupt. Now what?

Picking up from yesterday’s news, I see the pattern from Nova’s demise 2 1/2 years ago has kicked into action.

1) G.communication has been brought in as a white knight to receive the bankrupt company’s assets and to try and fulfill as many promises to Geos customers as possible.

2) The Osaka General Union has swung into action as a resource to help Geos workers, who now suddenly realize the value of associating with a union. Funny this always happens in the clutch. And rather than the General Union ask them about their affiliation (or where the dues money is), the GU will instead help the people and promptly be forgotten. Maybe they will get a thank you.

(I have no doubt the union is getting those calls, and not hoaxing it for effect.)

3) People associated with the remaining Eikaiwa outlets profess that their business is well run and going strong. Again, it’s like early 20th century banking. (Early 21st century banking in some ways, too, ne?) The quote I linked to struck me: Why would a company sit on four years’ worth of operating cash? Wouldn’t you use whatever that cash-generating machine would be to invest it in other businesses?

4) Inevitably in the shakeout, a sizeable number of ex-GEOS workers end up in Tokyo corporate accounting, filling seats in the pyramid of some not-so-competent senior manager . . .

5) The surplus of Eikaiwa talent in town adds to the “survive on the desert island” effect that the Japanese bureaucracy has either tolerated or created for at least 10 to 15 years now. They think this will never become an issue back in America. And maybe it won’t. I’ve heard a lot of good things about Ambassador Roos, but I also suspect the prostitutes ( * ) are still around the Embassy—they certainly are within the expat corporate world. None of them rock the boat about civil rights and labor issues, since it might interfere with their own (American taxpayer subsidized) good thing they have going on here.

The shameful thing about Geos is not so much that it went under, but rather, why these kinds of marginal businesses are even allowed to exist. If you look for the pattern, you’ll find it. It isn’t simply this “first Nova, then Geos!” chatter you are hearing. It’s why were these companies allowed to exist unregulated in the first place. No other service business would be allowed to organize the way the Eikaiwas do. And unfortunately, the ones that do are the ones involved in that sort-of seedy, nightlife entertainment “business” you find around love hotels.

But it’s more. It’s why companies like the dispatch system for secondary schools are allowed to exist. These companies take $5,000 a head off native speakers that they stick into junior and senior high schools as “English teachers”. They don’t cover the basic social insurance that Japan has promised America, as well as Canada and the Australians, would be provided to expats here on an equal basis as what the Japanese provide themselves in their laws. Many of the dispatchers find excuses around it.

The problem [that] companies operating in Japan seem to have with honoring labor law and granting non-Japanese equal treatment. Not putting people on a glide path out the corporate door.

The list could keep going, but I know the readership has heard it already, here or elsewhere.

The Eikaiwa business model is crap. It has nothing to do with the recession or the financial crisis, although I have no doubt that bad economics hastened the problem. Education is what is called in economics a “public good”, and so throughout the developed world the government plays a substantial role in maintaining an education structure. Except here in Japan, when it comes to teaching English.

Why?

( * ) – I don’t mean to offend prostitutes, who often are compelled by economics and/or dreadful situations into selling themselves. I’m not sure what the well-placed Tokyo expats have as an excuse.

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