Running government like a business
Published: July 1,2012
There has been quite a bit of debate lately as to the importance of business acumen as a key qualification for being President of the United States. Can government really be run like a business?
Republican nominee Mitt Romney claims emphatically that incumbent President Barack Obama has clearly demonstrated that the former senator, constitutional law professor and community organizer lacks a level of business knowledge that should be at the forefront of Presidential skills. Democrat Obama counters with the claim that Romney’s successes at the private sector, wealth-generating firm of Bain Capital have prepared him to make money, but have left Romney ill-prepared for the multi-faceted role as President of the United States.
It seems that somewhere along the way the notion that free markets and the invisible hand of the economy have acquired a role of pre-eminence in governing a free and democratic country like that of the United States. We seem to have quietly accepted as fact that the success of the free enterprise system in bringing about America’s unprecedented economic greatness has earned it the right to supersede all other implements of government.
It was not always this way. Up until recent years the role of government and the role of the private sector were separate to an extent, but always in a struggle to be equal. Perhaps it was that constant tension that made our unique approach to government and business work as well as it did.
History is replete with examples of government and business interacting for the benefit of the nation’s citizens and at times for the survival of the nation as a whole. There are also many examples of one or the other of these two sectors pushing back against the other when either was thought to have become too intrusive onto the other’s sphere of influence. The New Deal era of Franklin Roosevelt is littered with efforts by the federal government to create opportunities for those most affected by the Great Depression to partake of the advantages, meager though they were, of the free enterprise system. The Works Progress Administration and the Civilian Conservation Corps are but two of the programs that were designed to create private sector demand by directing money into the pockets of the unemployed in exchange for government work projects. These types of programs were followed by the massive infusion of government dollars into the preparation for World War II.
Over the years there have been concerns raised in both the public and private sectors. President Eisenhower warned of the unchecked power embodied by the “military/industrial complex,” or too cozy a relationship in the exchange of massive amounts of defense related dollars between the public and private sectors. Then there were the Great Society programs of Lyndon Johnson. The private sector became quite concerned at the apparent expanded role of “big government” during the Johnson “War on Poverty.”
Our current state of affairs came into focus during the “Reinventing Government” movement sparked by the wildly popular 1992 book and research by David Osborne and Ted Gaebler. The complete title of the book was Reinventing Government: How the Entrepreneurial Spirit is Transforming the Public Sector. These scholars incorporated the ideas of business management experts to make their case that government could adopt the methods of business to become more efficient and effective. While they advocated what was then considered the novel idea that government could take a market-oriented approach and be successful, that was only half of the equation. Osborne and Gaebler maintained that markets are impersonal and unforgiving and that for them to work in government concern for families and human issues must be added. They conclude that, “entrepreneurial governments must embrace both markets and community if they are to successfully shift away from the old and clumsy administrative bureaucracies.”
It is this latter directive of Osborne and Gaebler that has proven to be most difficult. One need not look far now days to become confronted by a disdain for anything related to government. Critics of this position rebut with the claim that market-only governance shorn of moral concern leaves out a level of justice necessary for humane government. It is indeed often the case that the private sector is allowed to “cherry pick” those functions that return a profit while leaving the “loss leaders” where profits are not possible to the government or leave the public to do without. Examples abound. The Tennessee Valley Authority is a major one where the government stepped in where the private sector could not. Then there is everything from the space program, to the highway programs, and crop and flood insurance.
So where are we in the debate over whose business or whose government experience best qualifies them to be President? The Supreme Court’s ruling on health care certainly makes the debate more intense.
Can we really run government like a business?
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