Running Governments Like a Business

Why do some politicians claim that their business background makes them a better candidate for public office?   Does private sector experience always equate into a valid claim to head a public agency or office?  

businesspoliticianWhat kind of luggage, good and bad, do some business people bring to the political arena?

It’s another election year so brace yourself to be inundated with ads and mailings from hopeful candidates who want your vote.  For most people elections generate very little enthusiasm, especially in a district like mine that has been gerrymandered by the GOP-controlled state legislature to ensure that only Republicans win.  But I am a political junkie of sorts and even as a progressive in red state Texas I still like to stay involved.

One of the tactics many conservative candidates like to use in this region of the country where government is profanely viewed is to emphasize their private sector business creds.  It is a foregone conclusion by many conservatives that government is wasteful and only someone with a business background can effectively run political offices over any non-business contender – except when that reality isn’t supported by the facts.   Does anyone recall George W. Bush touting his business background when he first ran for President?   Likely not since he was a colossal failure at just about everything he attempted.

Why such a belief is automatically assumed is somewhat incomprehensible when you seriously think about it.  Businesses, like governments, are essentially operated by flesh and blood human beings.   Fallible creatures known less for their perfection in getting things done and more for their self-centered drives that sees their world with a limited scope.  This is in fact one of the basic motivations for someone who runs a business.  Undermine the competition to your advantage even if it requires a lapse of ethics.  Some are less ruthless than others at this and as a result they are more prone to fail.  businessethics

So to suggest, as some potential candidates do, that they have business backgrounds and know how to “create jobs, balance budgets, solve problems and plan for the future”, they are falling back on a claim that lives more in the wishful thinking of some.  The nuance connoted with such claims too is that corruption in government can be corrected by someone who knows how to run a business.   The sad thing about this notion however is that nothing could be further from the truth.

One only needs to study the events in the financial market sector just a few short years ago to understand that greed and corruption within some of the highest earning “too big to fail” businesses led to one of the worst economic depressions this country has seen in 80 years.  There were other devious actions too from those engaged in commerce that contributed to the income insecurity of millions of families.

Many manufacturers and large retailers like Walmart, Sears and Target had already started abandoning the American worker years earlier for cheaper foreign labor markets.  This may sound like a typical business competition move but the truth is that this was a survival-of-the-fittest move; a self-serving response to keep their companies afloat in a highly competitive global market thanks in large part to NAFTA and other similar trade agreements.

naftaresults  A closer look also reveals that these jobs went to peasants in Indonesia, the Philippines, the Honduras and other third world nations where working conditions are unsafe, gruelingly long and pay slave-labor wages, with no sick or vacation time.  These are conditions that were supposed to be addressed by the trade agreements which allowed these companies to move to these cheaper labor pools.  But in the end business owners felt no real compulsion to push for these concerns that benefitted workers.

It is circumstances like these that always raises a red flag for me when a person touts their business experience.  Who really benefits when such business leaders take the reins of government?  We the people or them that already have a disparate amount of wealth? How much will their business background and the alliances they have developed play into decisions that affect their constituents?

How likely is it that conflicts of interest will motivate some when it comes to doing what is supposed to be done in the best interest of the community at large?  It has become common practice for many who leave politics to find a large, salaried position waiting for them with businesses that often contracted with the government entities these politicians previously served.  Will this play into policy decisions they make while they are in elected office?  There of course are laws in place to prevent such actions but oversight on such things are often controlled by pro-business types who have already worked their way into the public domain.

Then there is the obvious reality that most businesses fail.  George W.  Bush was hardly alone in his business failures though unlike many, he had bountiful family resources to fall back on at such times.  Some businesses that had been successful and had been around for years failed simply because they couldn’t stay up with trends, hired incompetent managers, mishandled their profits or just simply became obsolete before owners were even aware of their downward trend.

Some of the more recognizable names in business that have failed over time were Eastern Airlines, Schwinn Bicycle, the Lionel Corporation, Bethlehem Steel and software developer Napster.   Some were able to sell out to larger concerns so didn’t walk away totally empty handed while others had to file for bankruptcy leaving tax payers to cover their shortfalls.  But it is the small business person who usually experiences the greater share of failures.  Failure rates for small businesses “vary depending on where the statistics are coming from, but … generally 50 to 70 percent fail within the first 18 months”, according to one source.  These ultimate failures left a lot of former workers out in the cold, looking for jobs that were often scarce during tough economic periods.

Keep in mind too that businesses can only succeed if an adequate labor market, consumer demand and various economic conditions remain relatively stable over the years.   Those who claim to have run a successful business likely did so only as long as these factors were present.   A reality that often isn’t revealed to the voters they are trying to win over.

So when someone tells you they are going to run your disposableworkersgovernment more efficiently based on their business experience, it might behoove the voter to see how successful they have in fact been in their business endeavors.  It might also be of some value to learn whether or not they shared their success with those who worked for them and how well they treated employees.

A profitable business is not an indicator of someone with good character.  Did they bribe local election officials to look the other way when they were violating critical standards related to public health?  With the millions they have spent on public relations messages following the tragic Gulf oil spill, BP will still forever be imbedded in the minds of most people as someone they would rather roast over an open pit than elect for county dog catcher.

Identifying oneself as a business person shouldn’t automatically qualify for someone to run a government agency efficiently.  Theoretically business people can change practices they deem unnecessary or are unprofitable with little risk of alienating people.  This doesn’t always hold true in the public sector when you’re dealing with programs that have various support and opposition groups amongst voters.   Your control as an elected official is often challenged by the very people you promised you would improve conditions for if elected.

The bottom line for any business owner is to make a profit.   Its focus is narrowly fixed and limited only on those people who can help them achieve high rates of profit.  If this always occurred with honest men and women who treated their workers fairly and were transparent about any risk involved from using their goods and services, then there would never by any need for outside sources to review their practices.  Government oversight that is supposed to be in place to protect all citizens would be just an idea rather than the necessity it is today.   But no one is so naive to believe that businesses are beyond concealing facts when they stand to lose, million$, billion$ or even every thing they have built up because their greed is going to be exposed.

Governments that truly represent the people are not there solely for the edification of businesses.  They are also there to ensure that honest men and women prevail in their businesses and not allow the temptation of large profits to threaten the safety and health of trusting consumers.  Managing large government agencies is not part of the training a business graduate receives so why should we assume that their private experiences as a credit manager or a widget builder allows them some distinction over those whose training and background derives from the public sector experience?

politicalpandering

In my view, voters should not be swayed to vote for a person solely based on any individual claim that a candidate makes.   The fact that they owned a business or that they are a conservative or a Christian, or both, or even a war vet doesn’t always, if ever, tell us how well they will perform in public office.  These classifications appeal to some high ideals we mentally hold about them but veritably expose very little about an individual’s real character.  It’s less about their claims and more about their actual achievements that voters should demand from those who want to represent them.

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14 responses to “Running Governments Like a Business

  1. They should have to show they have experience in a public (not provate) corporation with an extremely large Board of Governors which has to vote upon every decision they make but is widely split upon the direction their company is going. If they can do that, then their business experience is pertinent. If not: a company’s goals are to make profits, maybe grow, maybe serve their community (a little), maybe build a new facility … are these are what we want government to do?

    • You did a post related to this Stephen and I was going to cite it here but I couldn’t find it in your archive. Could you provide this or was I thinking of some other piece written by someone else?

  2. I did a post a few years ago on this subject. One of the things that really gets overlooked in the business experience as a qualification is that a CEO, or principle owner, really doesn’t have to answer to anyone or have two other branches who not only don’t answer to them, but can overrule them. There’s a different culture, and more than a few governors who managed to get elected based on their business experience have found that out the hard way. In fact, two of them are ranked right now among the “most unpopular” governors in the country.

    • ” a CEO, or principle owner, really doesn’t have to answer to anyone or have two other branches who not only don’t answer to them, but can overrule them.”

      Great point Norbrook. Thanks for sharing your link on this

      • You’re welcome. It’s when you have a truly … insane … candidate running for governor who is touting his business experience that you start thinking of this. 🙄 Rick Scott in Florida found out the hard way that “legislators don’t answer to the governor.” In fact, it was the Republican legislators that got seriously ticked off at him and made that point.

  3. It didn’t serve Romney too well.

    Larry, I just came across this quote from Rep Joe Barton, Tx; chairman of the House-Senate Energy Conference Committee.

    “Wind is a finite resource and harnessing it would slow the winds which would cause the temperature to go up.”

  4. One needs but look at the average business model to know that you don’t want a government run this way….there is not much human in how a corp does business…it’s just profit…Is that how we want our government run? Of course not, but to the unlearned ear, it sounds right, thus the meme is created and they will go forth with it…like the balancing budget analysis to how family’s budget…totally not the same things, but of course it sounds right to stupid ears.

  5. yup…that was a now, not a NOT/// Johnson is a joke. He marries the ‘bosses daughter’, the boss gives him a job…and whoosh…he is a businessman.

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