People must really be attached to their analogies, since they seem to be pretty desperate to make a government seem like basically anything that’s not a government. First there were the conversations about how the government needs to think like a household (obviously, since the average household is doing so well nowadays and never makes poor choices), and now, presumably because of Mitt Romney and some of the other contenders for the Republican presidential nomination, we have talk about how private-sector management experience is so helpful because the principles that lead to success in business will also lead to success in government. (Personally, I am still waiting for someone to explain to me how government is like a pizza or a leaky balloon or something.)
Unfortunately, the government as business analogy breaks down pretty quickly, if for no other reason than, if government were to operate primarily using for-profit business principles, there would be little reason for government to exist as a separate entity. (We have plenty of “one dollar, one vote” in shareholder meetings, so a “one person, one vote” system is a nice counterbalance.) You can read more on the issue here:
Legally speaking, the fiduciary duty of a corporate board of directors (and, by extension, the corporation) is to maximize profit for shareholders. Sometimes the well-being of “stakeholders” — i.e. all entities who are affected by a company, including but not limited to shareholders, employees, customers, downstream neighbors, etc. — comes up in conversation, but usually only to assess what impact stakeholder satisfaction has on shareholder value rather than as a goal in and of itself. If one were to apply this principle to government, then the government’s fiduciary duty would be to maximize the well-being of its “investors,” with the importance of each investor measured by how many shares he owns. Investors, in a government sense, are taxpayers, so applying this business principle to governance would mean that the often-mentioned 47 percent of people who don’t pay federal income tax factor very little into the government’s “profit” calculation (and not at all if they don’t pay payroll taxes and such), and rich guys who pay a lot in taxes would dominate the government’s priorities. (Sound familiar?) If you believe that the government’s mandate is to think about societal well-being in a democratic “one person, one vote” sense rather than in a “one dollar, one vote” one, you should not want this business principle to be applied.
If you read the linked article, you probably noticed the unfortunate choice of headline (though not as egregious as the “Let Detroit Go Bankrupt” headline that was slapped on Mitt Romney’s op-ed by the New York Times). I can certainly see various types of private-sector experience being helpful in the public sphere, but that doesn’t mean that it’s a good idea to run a government as one would run a business. The issue, however, got me thinking about what sorts of people (outside of the obvious lawyers and such) would be helpful to an efficient government, and my thought process keeps leading me to operations consultants. As such, I will be starting an Al Roth for President campaign tomorrow.