Home > Uncategorized > Should U.S. Government be Run Like a Business?

Should U.S. Government be Run Like a Business?

I have often heard it said that the United States government should be run by a business. Implicit in this assertion is that we need someone who has been successful in business to manage the government. However, I can’t think of any successful presidents that had a strong business background. Furthermore, the idea of running the government like a business assumes that the problems that plague government are ones of efficiency and planning. What exactly is government supposed to produce? How precisely do we measure its output? What is the return on investment? 

The more I think about it the more I believe that the whole idea of running the government like a business is a dead end. The president isn’t a manager. The president is a leader, a visionary, a high-level thinker, a communicator, a sometimes consensus builder. While a business must often face competitors on a daily basis and constantly fight to maintain profitability, the president has a wider time window to take their vision, implement it, and hopefully achieve good results before having to face the voters in the next election. The business leader can, if need be, get their organization to turn on a dime. They can say, “jump” and expect someone to jump. The president has to work with Congress to achieve goals and, at the same time, maintain public support.

Apart from the dissimilarities between presidential leadership and business leadership, the nature of business and government are almost completely different. Businesses compete in very specialized areas. The government is a general enterprise. The “business” of government is not producing a specific output, rather it is creating and maintaining an environment where individual rights are protected and economic competition is – in theory – fair. Our government ensures that the people are protected from foreign (or domestic) enemies.

What especially bothers me though about the whole running government like a business meme is that it glosses over the question of what “business” the government should be engaged in the first place. In a real business there is a price to be paid for making the wrong decision. Often, businesses that stray from their area of expertise find they cannot compete and either exit that particular area, or simply fail and go out of business. However, the government can enter any number of areas without expertise, without solid planning, and without any exit strategy and continue to spend taxpayer money for long periods of time without paying any price. Eventually, as witnessed by the current debt / financial crisis, there is a price, but it has taken many, many decades to reach this point. The idea that the government can somehow efficiently manage the economy, medical care, prescription drugs, retirement, etc. are rarely called into question. Even if a politician questions the government’s role in some area of the economy, they often assert that better management, increased taxes, spending cuts, etc. will somehow resolve the problem. In fact, it is possible that the government has entered an area where it lacks expertise and should exit rather than continue to throw good money after bad.

Although even historians cannot agree who all of the great, almost great, etc. president were, you aren’t going to find anyone from the world of business at the top of the list. Eisenhower was a great military leader and as president warned of the dangers of the military-industrial complex. His original conception of the military-industrial complex was a triangle which included Congress. Andrew Jackson was a great military leader who, as president, fought against the Second Bank of the United States. Abraham Lincoln was not necessarily the business failure he was made out to be, but achieved his success as a lawyer rather than a businessman. The two prominent businessmen that became president that I can think of were Herbert Hoover and Jimmy Carter. I am pretty sure neither one of them will ever be considered great presidents. One of the common criticisms of Carter was that he was a micro manager – always bogged down in the minutia. This stands in contrast to Reagan, an actor, who had the reputation of delegating the details and concentrating on the big picture. The point, however, isn’t to get stuck on specific presidents, but – rather – examine whether or not the idea that the government can or should be run like a business is valid. What do you think? Does the government have anything in common with business? Would we be better off is someone who has achieved business success became president?
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