A reader of this blog sent a link to a minnow-related news story, a little piece in the New York Times that didn't merit much space.
The article might have been more suited to the business section, since it's all about a remarkably common business practice, one that Barry O'Callaghan's school of fish has found useful. It's made Mr. O'Callaghan the epitome of the gombeen man.
Ever wonder why you can't find a contractor to take on a small job?
Because that contractor has gotten stiffed more times than he cares for on the small jobs.
Lawyers cost money, so if the bottom line on the unpaid bill is less than the potential legal fee, you write off the loss and take it as a lesson learned. No more small jobs that aren't collectible.
Houghton Mifflin Harcourt subbed out some components of their textbook production to Inkwell Publishing Solutions, which in turn hired freelance writers to compose the paragraphs and chapters of textbooks that HMH then prints to order for state school boards which require custom wording and topics.
Unfortunately for the whale-swallowing minnow, cash flow has been quite an issue and HMH couldn't pay Inkwell for the contracted work. Work which the freelancers did, and which Inkwell subsequently turned over to HMH.
So there's Inkwell, out of pocket, and when the freelancers turned to their employer for payment, the pockets were empty. Inkwell was skint.
Unlike the contractor who will make good with his material suppliers to maintain their favor and future credit privileges, the owners of Inkwell told the freelancers to go scratch when they came looking for their paychecks. No money from Houghton Mifflin Harcourt, no money to the people who wrote the textbooks that HMH will be selling.
And the freelancers who are owed three or four thousand dollars won't sue HMH because a lawyer would be more expensive than what they're owed.
As a business model, it works, as long as there are thousands of freelance writers looking for work. That means there's a nearly endless supply of labor, willing to grab the bait and end up on the hook.