If you read the N.Y.Times in its coverage of the disruption of the Kindle, you might think that publishers are losing a fortune from the sudden rise in Kindle sales.

Actually, the opposite is true. Amazon is buying Kindle rights from publishers at the same price they’re paying for physical books. And Amazon is sticking with its policy to sell Kindle books at no more than $9.99. So take your average $20 list price hardcover book (if I were a shameless self-promoter, I would use my book The Genius Machine as an example, since it also has a list price of $20. But I will resist the temptation.) The publisher sells it to Amazon for 50% off, or $10. Amazon could sell my the book for $20, but they discount it down to $13.57, and make a profit of $3.57, or maybe a little less if Amazon is paying for shipping.

Now take the same book sold as a Kindle. Amazon pays $10 for those rights, too. And Amazon sells the download for $9.99, thereby earning a gross profit of 1¢ on each copy. On books that wholesale for more than $9.99, Amazon seems to be locked into a loss with every sale.

And what about the publisher? On a $20 retail book they get the same $10 for the Kindle edition as they did for the actual hardcover that cost them some $2.00 to manufacture, ship, and even keep a reserve for returns of unsold books. So who is making a killing on the Kindle? The publishers. And Publishers, please, if I’m wrong about these numbers, share the facts with us in the comments below.

Publishers are worried that Amazon will choose to stop losing money on Kindle sales at some point. They are just waiting for that shoe to drop. Hence the cheering for Barnes & Noble’s new reader, Nook. (Nook. Interesting name. Just asking, but what would you call a diminuitive version of the Nook?) Publishers are beyond eager for someone, anyone, to stop Amazon from completely owning ebooks! Now let’s talk about those ten books that Wal-Mart and Target are offering for pre-orders at $8.99 and Amazon at $9.00. These are for hardcover books ranging in list price from Linda Howard’s Ice at $22 all the way up to Stephen King’s 1088 page monster Under the Dome that lists for a mighty $35. What is the meaning, if any, in these door-busting discounts?

Comes now (“Comes now” is a locution reserved for columnists who can’t find a better way to introduce a new character into a story. But I digress.) Motoko “Cassandra” Rich of the N.Y. Times in her “Price War” story in last Saturday’s paper, wherein she worries that Wal-Mart selling some pro-orders for books as a loss-leader will somehow “fundamentally damage the industry and the ability of future authors to write or publish books.” And, once more, end publishing as we know it.

To tell her story, Ms. Rich interviews bestselling author James Patterson, who she was apparently grateful to reach before her deadline, since she quotes him at length no matter how little light he has to shed upon the subject. Frankly, interviewing an author about retail price discounting is akin to interviewing a tuna about the price of a Salade Niçoise.

The fact is, publishers don’t really care what a retailer sells a book for. Retailers want to take a loss? No problem. What everyone needs to be concerned about, though, is when a Wal-Mart or Amazon pressures a publisher to sell at what is known as a “deep-discount.” That should set off alarms for authors and agents, since most author agreements call for author royalties to take a severe hit when the publisher sells at a deep discount. Authors: Read your contracts! Find that “Deep Discount” clause. Does it say something to the effect that when the publisher sells your book for more than a 50% discount, the author royalty suddenly gets cut in half? Think about that. The publisher gives Barnes & Noble an extra 1% discount and you lose half your royalties on every book sold.

The big take-away here is that nine of the ten books being hacked down in price by Amazon, Target and Wal-Mart are fiction titles. Only one calls itself non-fiction. And this is the clue to smart book pricing. Fiction is generally sold as entertainment. Entertainment tends to be more fungible. Non-fiction is generally sold on the value of the information it contains. So pricing the two in the same way seems crazy.

How much would you pay for information that can change your life? Heal a child? Save your business? Is that information worth only $20? Is that all you’d pay for it?

We haven’t begun to touch value pricing for non-fiction. That is the real gold mine just waiting for publishers. We’ll write more about the potential and the theory of value pricing soon. In the meantime, you have to wonder about the one non-fiction title that’s being treated just like all those other nine fiction titles being deep discounted. Yes, it’s Sarah Palin’s memoir. Now, if what she were about to disclose had great value, say information that could, in some way, save the Union, it certainly would be worth a lot. Some of us would pay real money for that kind of knowledge.

But Wal-Mart, Target, and Amazon say we can have it all for just $8.99. Maybe they know something.

Search and advertising giant Google and Ohio Art, maker of the children’s classic drawing toy announced a joint venture today to produce the first e-book reader for pre-schoolers. Named the Etch a Book, the new reader will capitalize on the highly refined Etch a Sketch two knob interface which is already familiar to millions of parents and children all over the globe.

In making the announcement, Sergey Brin, co-founder of Google, revealed that Google has been scanning children’s literature of all kinds for several years now, accumulating a library of more than 2,000,000 children’s titles, many of which have been out of print for decades.

One of the big challenges in developing the Etch a Book has been the fact that young children don’t yet read. “The answer we found was to read the books to the children,” says Brin. The Etch will offer several voices, including those described as ‘friendly mom’ and ‘funny dad.’

Since the Etch a Book screen is closely derived from the classic Etch a Sketch, the reader will not be able to display text or pictures. “This was a big challenge for the books that are all illustration and no text,” says Larry Killgallon, CEO of Ohio Art. “We wanted to keep the child involved and the screen interactive, as with all our products.” The answer is to have the friendly mom reader or the funny dad reader describe the art that Google has scanned. For Mike Mulligan and His Steam Shovel — “There’s a big steam tractor digging a hole,” says the voice. In presenting what had been a cloth book, The Big Farm, in the demonstration we saw, the ‘friendly mom’ is heard to say, “And here’s a big white sheep.”

To complete the reading experience for the very young, the Etch a Book comes with an available Bouncy Lap, which vibrates the child up and down gently while the child is being read to by the Etch a Book. Also available is a ventilator, which simulates the soft breath of a reading parent on the child’s cheek. Available Christmas.

Calling in those McKinsey folks to review your profit and loss numbers in the middle of the deepest recession since the 1930s is a little like having Dr. Kevorkian over to offer a second opinion.

“No, really, I’m feeling fine. Just a little touch of the flu.”

“Not at your age. You know, if you were a new publication, you might pull through. But Harold started you back in 1925. That’s a long, long haul for a weekly. But look on the bright side: it’s been a good run.”

When Si Newhouse decided that Gourmet was wearing a Do Not Resuscitate bracelet this week, a great many people were stunned. My wife even called Condé Nast to leave a message for Mr. Newhouse, but the switchboard said there was no way to leave a message for the boss. Maybe that’s the way it is when you’re the emperor. You can begin to feel as if you don’t need to listen to anyone, even your customers. And I guess that’s true.

That’s what bothers me. In the equation that McKinsey puts forth, if a magazine loses money for X period of time, no matter how brutal the overall business climate, you kill it. It’s just a product that failed. The stakeholders are the shareholders of the corporation, aren’t they?

I don’t think so. Enlightened business thinking holds that the stakeholders in a business actually form a broader constituency. For one, the customers have a stake in the organization. You invited them, encouraged them, brought them into a relationship. The employees are stakeholders, too, planning their lives and careers around the enterprise. There is the community that supported you, as well. That’s the food community, the New York publishing community, and the magazine distribution communit

We learn from Stephanie Clifford in the New York Times how Charles H. Townsend CEO of Condé Nast sees things. And just between us, if I was Elizabeth Hughes or whoever has P&L responsibility at the New Yorker, I would examine these quotes carefully, since someone might be saying them about me before too long. And then I might take a few moments to make sure I could find the exits in an emergency. You can’t be too careful.

So, New Yorker, ask yourself, could this be you? “In the economics of the 1980s, 1990s and early 2000s, this would be a business decision balanced by the cultural reticence to part with iconic brands,” Charles H. Townsend, Condé Nast’s chief executive, said in an interview. “This economy is a completely different bag.” Feedbag? Trashbag? Bodybag? Just wondering.

Then there’s this thought from Suzanne M. Grimes, who oversees Every Day With Rachael Ray, among other brands, for the Reader’s Digest Association. (Ah, excuse me! EXCUSE ME! Didn’t Reader’s Digest go bankrupt last month? This is The N.Y. Times’s expert on where Gourmet went wrong?)

“Cooking is getting more democratic,” she said. “Food has become an emotional currency, not an aspiration.”

Now if you’re at the New Yorker and not hiding under your desk, just play along with me here. It might strengthen you for the future. Just substitute the word thinking for cooking and you get this: “Thinking is getting more democratic,” someone might be saying someday. “Thinking has become an emotional currency, not an aspiration.”

So if you’re in the thinking and not the cooking business, it could look bad for you, too.

Now try the same device with this farther down in the article:

It [food] has also become democratized via the chatty ubiquity of Ms. Ray and the Food Network stars. Ms. Reichl is a celebrity in the food world, but of an elite type. She ‘is one of those icons in chief,’ said George Janson [advertising guy] But what harried cooks want now, it seems, is less a distant idol and more a pal.

So the New York Times obit for the New Yorker in a few months might read:

Thinking has also become democratized via the chatty ubiquity of Twitter and Facebook. Those New Yorker writers like Malcolm Gladwell were celebrities in the thinking world, but of an elite type. Gladwell is one of those icons in chief. But what harried people want now, it seems, is a less distant idol and more a pal.

Hey Malcolm! How come you never call?

So if you ever have the chance to get Si Newhouse on the phone, or just happen to run into him at a party or at the opera or something, you might want to have a little chat about who you think are some of the stakeholders in the New Yorker. Just cause a racehorse tripped doesn’t mean you have to put it down.

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You’re third in line for takeoff, finally ready to depart La Guardia and get to your lunch meeting in Chicago. The pilot comes on the P.A. for a last-minute cheery message: “Thanks for your patience. We hope to make it up once we’re in the air and get you to O’Hare on time. Or at least someplace not too far from there. We’re thinking maybe Gary or Indianapolis. As the President says, we shouldn’t make the perfect the enemy of the essential. So wish us luck.”

What if that were acceptable? What if we never got where we were hoping to go, and it was okay?

What are the implications when President Obama tells us that part of his philosophy is, “We shouldn’t make the perfect the enemy of the essential?” Sounds reasonable, in a way. Don’t want to be a perfectionist about everything. Wouldn’t be realistic. Never get anything done. Got to compromise, make a deal. Make progress of some kind.

I’m not so sure about throwing the perfect overboard. I keep wondering how can we ever know what really is essential unless we first know what the perfect looks like? Sure, when you’re going 500 miles per hour in an aluminum can at 30,000 feet, essential is you land in one piece, somewhere. But when you’re on the ground planning a trip, maybe the perfect includes getting all the way to your destination.

You want to know why this country is so confused about how to move forward on healthcare? One reason is, no one has given us a vision of what the perfect looks like. Without the perfect, we’re not even heading to Chicago and putting up with the reality that we might land in Cleveland. Obama’s vision for healthcare still feels to lots of people as if we’re just lifting off with no clear vision of where we hope to land.

Would you really want your team to design anything without first making the effort to get a clear picture of what the perfect might be? If we don’t attempt to imagine what the perfect is, let ourselves dream and reach for the stars, then we are giving up our greatest gift as human beings before we even start. Without a destiny that we can see and dream about and hope for, what is to guide our efforts? The journey of progress will be vastly longer if we don’t know where we’re going.

What if Frank Gehrey had listened to that board member (whom I’m certain existed), the one who said, “Now, don’t go all crazy Frank,” and never asked himself what the Disney Concert Hall should be like if he could create exactly what we wanted? What would I like the outcome to be of my open heart surgery? What kind of achievements would you like to have in your life? Do you want to start by thinking about all the compromises you’re going to have to make, or do you want to imagine what you want to do, first?

Now that I’ve won you over (at least for a moment) to the notion that we should try to imagine what perfect would look like, let me invite you join me in imagining what would a perfect healthcare system be like? I, for one, would toss in the principles that everyone would have the healthcare they wanted and needed. People would be educated about healthy choices, and the obesity rates would decline. Money in the system would go to caregivers. Overhead would be kept at a minimum. Compensation for doctors would incentivized quality outcomes. We would shift from a sickness to a wellness system. That’s top of mind for me.

What about you? You can add your own thoughts, or turn this upside down. But whatever the discussion, we need to be able to hold up for ourselves a clear well defined picture of where we’d like to be someday. Many people feel the perfect is, “Single Payer.” But I think whether that’s it or not, we need to see how it would actually be in reality. Maybe we even to imagine what would happen if the healthcare insurance industry were downsized or shut down. I have no trouble seeing it, by the way. I just imagine decommissioning old coal-fired electricity generating plants. Same thing.

Whatever our vision of the perfect is we will be, finally, ready to design our compromises with “political reality” (which means working with those Stakeholders Who Are So Large That No One Can Say Their Name). And most important, look at those compromises and determine whether they allow us to remain aligned with our vision of the perfect, or if they take us farther off track.

Without that clear picture of where we want to go, we will never get closer to it. With that vision of the perfect, we’ll always know what’s left to be done. That’s what leaders are for, by the way. To inspire us with a vision of the ideal, and then make the incremental steps that move us comfortably yet inexorably, forward.