Government is Not a Business

"When morality comes up against profit, it is seldom that profit loses."
- Rep. Shirley Chisholm

There is an idea in our land. It is an idea that has been gaining traction since the 1980s, since the Great Communicator convinced so many that the New Deal had been the wrong deal, that the Social Contract was a pact with the Devil, and that welfare queens, homeless vets, and liberals were undermining that which made America great. The idea, simply put, is that Government should be run like a business. It is a stupid idea, but there you have it.

Reagan, a smiley White man in a dark suit, cemented the idea of the president as CEO, legislators as Middle Management, and the citizens as stockholders. He convinced many that, with Government as Business, careful money management and profit would be the rule of the day. Government waste would be a thing of the past! Surely men who put money first would run our country efficiently -- and anyone who said otherwise was a stinky commie! So it came to pass that where once Congress and legislative houses around the country had been filled mainly with Lawyers, whose training had prepared them to draft and interpret laws, "Government as Business" took hold, and these lawmaking bodies became filled with business leaders who had little or no law study or experience. These elected MBAs and jumped up Chamber of Commerce members worked to get "Government off our backs," deregulating everything they could, and managing the wealth of the county, or country, as they would any for-profit corporation.

But here's the thing: democratic governments are structured and function not as corporations, where profit is the bottom line, but as nonprofit organizations, where the providing of services is their sole function.

This is an important difference, and given our last few Administration's mania for privatization and for submitting the wealth of our nation to the whims of the Stock Market, it is important we understand profit and democratic Government are not only incompatible, they are antithetical.

Let's go!

A: Corporations are legally bound to provide the greatest financial dividend to their stockholders. That's it, that's all they have to do. Really. Look it up. (Oh, they're also not supposed to break the law -- however, let's stay with reality.)

But: Democratic Government is not structured to make a profit. It's job is to spend the pooled contributions of the citizens (taxes) to provide services to those citizens - health, education, defense, infrastructure. There is no profit, as we, the People, are supposed to run this country, and are not selling these services to ourselves. That would be silly. Representative Government is simply a mechanism created by citizens to provide themselves with the necessities of a life unaffordable to the individual. For example I can't afford to build a road, dispense Justice, or make sure my food supply isn't handled by filthy nitwits. But by pooling my money with that of other citizens big things become affordable, and by voting in the No Filthy Nitwits Handling Our Food Party, we won't have greasy fingerprints in our tapioca. That's all taxes and Government are. There is no financial profit. It's sole purpose is to provide services.

Next: The greater the Stockholder in a Corporation the greater his or her influence in that Corporation.

But: There are no stockholders in a democratic Government. Citizens do not buy stock, and reap financial dividends. Even the Richest citizen only gets one vote - and man, do they hate that!

We, the People, hire the government to use our wealth to distribute services, which we all benefit from. Again, it is structured much more like a nonprofit organization, with a Board of Directors - a voting body which elects a team of Administrators. In our case the Board is the voting citizenry, and the Administrator is the Mayor, Governor, President, and the Legislatures. And as a nonprofit Board, the citizens do not expect financial benefit, but expect their money to go to services provided to the community.

Numero Tres: A Corporation will cut costs to achieve profitability, degrading it's product if it must. Remember, a Corporation's job is to make money for it's investors -- the product is only and always a means to that end. If they can make more money selling crap, they will sell crap. SUVs weren't safe for years, but boy, did they make money! And if it is more profitable to junk a stable company, it will be junked.

But: For Government, the services provided are foremost. Like nonprofit organizations, it's primary function is service.

However we, as Americans, have become so hypnotized by the Svengalis of Wall Street -- and their mystical mumbo jumbo about the Market being the pinnacle of Democracy and Freedom -- that not only do we watch them dismantle a Government by, of, and for the People for their own profit right in front of us, we we gleefully chant their Free market Mantra as they do it. We convince ourselves that the profit motive is the purest, fairest arbiter of Truth, and that what is good for the rich must be in the best interest of us all -- because some rich guy said it was.

Crapaganda.

The Stock Market is simply where gamblers bet which business will make them more money. Not which product is best, but which company will prosper by selling it's image. That's how all those Dot Coms that didn't even make a damn thing had such high stock prices. All they delivered was millions of dollars to their early investors who sold inflated stock to the later suckers. Is that how we want our Government to be run?

Hell, crack is profitable, but I don't want my Government run by drug dealers just because they know how to turn a buck.

Unfortunately what we have now is a government made up of business people who are highly suspect of any expenditure that does not have a positive financial return. People in the halls of Congress who shout "Show me the Money!" when they should be asking "Where are the services?"

And this is the crux of the problem with the current governmental philosophy: profit-driven services. Once profit is introduced as a motivator, it becomes the only motivator. And there is a word for people who profit off the Government, especially in times of war. They are called Profiteers. We used to shoot them.

Here's an example: There was a time when the Armed Forces were a place where a young man or woman could learn a skill besides weapon specialist. Mechanics, radio operators, cooks, truck drivers, and so many more -- all jobs that had a life after service, accompanied by a wealth of benefits from a grateful nation. But to the Corporate philosophy this makes no sense. No one was getting rich providing soldiers with this priceless training. Socialism! And if all those vet benefits are free they must be inefficient, too! So we have Halliburton, KBR, CACI contracted to make these jobs part of the market, where profit, not service, is paramount. Benefits that cannot be made profitable are cut. We outsource Walter Reed Hospital. The result? The costs go up, the stockholders get richer, and hundreds of thousands of vets come home with less training, fewer benefits, and once again the rich get richer, and the poor get screwed.

And Blackwater... why did Americans so readily accept that the Marines are no longer good enough to guard our stuff? Why don't our elected officials trust the Few and the Proud to watch their backs anymore when visiting overseas? Sure, they call Leathernecks heroes, then diss them by looking elsewhere when it's time to pick the honor guards. I guess nobody was making money off the Marines.

The same goes for the outsourcing and "right-sizing" of governmental health and welfare organizations, the terrible failures at FEMA, the FDA... Did you know that most Americans who will receive tax refunds will have them processed and mailed to them by a private, subcontractor at a greater cost than if the Government did it -- which means any refund they will get will be slightly lessened -- to make someone rich richer. That's just messed up.

The philosophy of profit cannot be made to jibe with the Department of Education, so instead free, public education has been underfunded for years, then blasted as an inefficient, money losing proposition. And the idea of free schooling has been replaced with a push for private charter schools -- which always make someone richer, but fail to make our kids any smarter. Studies show the test score are about the same -- the only difference being someone made bank.

This is not sustainable.

Remember -- almost 60% of for profit businesses fail in the first four years. I'd like my Government to last longer than that. And as my friend John says, "If government should be run like a business, and our government is filled with businessmen, shouldn't everything be running better?"

It is not because it cannot. Putting a business person in the position of running government makes as little sense as putting the director of a nonprofit in charge of a for-profit corporation: the tools and skills they have were developed using a philosophy that is antithetical to the new position.

So, to sum up -- let business have all the dog eat dog, profit-worshipping, image over substance, greed sucking, suit wearing backstabbery it wants -- regulated, of course -- while we demand Government become what we, the People need: a vehicle to provide the greatest good to the greatest number, to comfort the needy, to protect the helpless, to encourage the brave, to insure domestic tranquility, provide for the common defense, promote the General welfare, and secure the blessings of Liberty to ourselves and our posterity.

And not for Profit.

Comments

[Amanuensis]

It's Shirley Chisholm, not Shirley Chisolm.

Thank you,

Frank Chisholm

[MichaelGeneSullivan - Huffpost Blogger]

I am so sorry!

I cannot apologize enough. She was an admirable woman, and if I'm going to use a quote of so great a person, you'd think the least I could do is get her name right. Sometimes I get so passionate about my subject matter that I forget the simplest, yet most important things.

Again, I am so sorry.

[MetroPietro]

Comment, Part 3:

Not only is government not a business, but businesses only exist because of governments. For better or worse, governments protect property rights, especially intellectual property and trademarks. To serve an economy in a healthy way, a public must push for policies that reflect this basic relationship in which governments perform the unique role of protecting rights. One aspect of rights-protection which we have neglected for too long is the capacity of governments to hold firms accountable to the public good. "Promoting the general welfare" means more than the right of a firm to earn a profit (although that is part of it). The older meaning is that companies can only be incorporated and active in a society if they serve the public. Regardless of whether they sell a better widget or service, the firm"s public behavior must, on balance, be beneficial. That was explicit in Royal Charters, but it is still true in the Business and Professions Code of states like California.

The "virtual bodies" of corporations should be understood for, and held to their original purpose. The whole "body" thing was to limit liability, not to give rich people an extra vote"First Amendment privileges for corporations should be banned by the basic understanding of the Constitution as applying to human beings. But these "bodies" should also be understood again as part of the res publica; as organizations whose revocable contract is with the public and for the public benefit. To avoid sounding too 18th-century retro, we can point out that the understanding of the public good includes environmental protection and a very contemporary version of human rights.

Righteousness. Not holier-than-thou, just a work-in-progress view of political economy.

[MetroPietro]

Comment, Part 2:
We Lefties can argue for economic growth. Conservatives and neolibs assume that they are the only ones who are pro-business, and by implicit extension, the only ones who favor aggregate growth in wealth. In practice that is demonstrably untrue. Any number of Leftist governments were deeply committed to economic growth. Furthermore we can argue that we are committed to growth with major investment in its own sustainability. That investment ranges from educating our young and giving them hope; to keeping our roads, levees, and bridges intact; to basic research in technology, the environment, and social theory that enables us to understand our world, reduce the suffering in it, and avoid destroying it. Conservatives call that sort of investment "redistribution" as if money is being taken from the deserving rich and handed to the undeserving poor. To persuade them, maybe we should gloss over the fact that the rich make so much of their profit by underpaying and overcharging the poor and just point out the improved business climate produced by such social investments.
Another important talking-point is "reasonable inequality". It is OK for some people to be paid more cash for work that has more cash value. We must be very clear about the distinction between equity"meaning equal treatment under the law, and equal pay for equal work"and fair wages. Reasonable inequality lies somewhere between absolutely equal resource distribution on the one hand, and what we have today: outrageous inequalities which allow for malnutrition among laborers in Fresno while a whole suburb of multimillionaires and billionaires grows in Saratoga. But how do we passionately stake out a position that could be dismissed as "moderate"?
Let"s call it a Righteous Political Economy.
Righteous as in rights; as in moral; as in something verging on the poetic. It is Righteous to clean up that toxic spill and internalize those externalities; it is Righteous to promote the dignity and matriculation of our high-school-age brothers and sisters, not to punish them with No Child Left Behind policies.

[ChuckFitz]

You just summed up what should be the Democratic Party platform in 20 or so paragraphs. When you put a party that despises government in charge of the government, you get.......-wait for it........shi**y government. As I like to say, "Sure, we don't need BIG government, but we need A government!" (that's copyrighted)

Now if we could take your 20 paragraphs, slim it down to three words, give it a brand identity, and cram it into the citizens' heads...then maybe people would get the idea.

Oh, and an example from Nebraska. Last week two social service workers working for private entities were arrested. They were transportation specialists that drive wards of the state to school, appointments, etc. One was arrested for drunk driving with an 8-year-old in the car. The other for sexual assault. The drunk driver drank a bottle -yes, a bottle- of vodka before hitting the road. Police caught her because of numerous 911 calls from other drivers.

If you care to be amazed, google 'nebraska ward of the state drunk driver.'

[FascistNation]

No. It is a criminal syndicate.

[Esprit]

Michael's got it on the nose. This is the most important threat facing the Constitution, that of corporatism; fostered by Reagan, furthered by the Bushes. Privatizing the government paves the way to a new fuedalism and slavery of the populace. We as a nation have become complacent, docile consumers, more than willing to let privatized mercenaries to "defend" that Constitution. And they won't!

[SamThornton]

New Orleans after Katrina provides a foreshadowing of what may be our fueudalized future. A showcase for privatization, it's charterized school system is a resegregated shambles, housing is a bad joke, and it's main employment source prisoners, who wait months to years for their day in court, leased out by the local jails to "enterprising" businesspeople. Guess who represents the highest proportion of prisoners?

[SamThornton]

In criticizing the zero-sum game that corporatism has become in America, many cite the idea that there is an implicit social compact that we all (should) subscribe to and which corporations increasingly violate.

Turns out, there may be a biological basis supporting exactly this idea. If what Michael Shermer, writing at Scientific American, has to say on the subject is true (he backs it up with examples from peer-reviewed research), American business may well be engaged in rapidly digging its own grave while it thinks its merely improving its bottom line. http://tinyurl.com/346f5z

I invite the interested reader to draw their own conclusions.

[rixhex56]

Why can't this message break through all the rhetoric of Republican-Conservative-Neocon politicians? It is not even particularly difficult to understand this concept. So why have so many BOUGHT into this stupidity that profit margins equal democracy? Sadly, even Democrats spew this crap. What gives?

[Jimco]

Rixhex56 , I can answer that , this retoric has been shoved down our throats for years unchallenged . If someone questions the premise they are labled socialist or anti american . Of course the actual comparison of our greed driven system with democratic socialist countries is never honestly made , health care is an example . The corporate structure has spent decades making sure that to get elected to public office their money is necessary , without it one has virtually no chance . If you don't represent their interests you can't afford to run . If you do manage to make a go of it without them somehow , you get no money . They have also gained control of the media making sure any serious threat to them gets no airing , instead of news we now have infotainment . You may have noticed that PBS , once an excellent source of information has been neutered . The trick is to first make them dependent on corporate money , then slowly gain control of the content . They have moved the funding from the public to corporations ( lots of oil companys ) . We desperately need public financing of elections to get special interest money out of politics and public policy decisions . The problem is they have become so entrenched and are in almost total control of our government . If someone doesn't do their bidding they get no money . they also make sure their guy has unlimited funding , plus control of the spin through the media . You need look no farther than the current batch of democrats seeming ineptitude . They are consistently ignoring the publics wishes , impeachment hearings , wiretapping , healthcare , the war , refusing to investigate the bush administration in any meaningful way . What are our heros doing , making noise about steriods in baseball . We are in deep trouble my friend . You may notice we have been given two essentially corporate friendly democratic candidates to pick from . So would you prefer republican or republican lite , those will be our choices . Heads they win , tails we lose .

[rixhex56]

I have noticed all the things to which you refer. I just don't understand why so many are willing to stand by and do nothing to stop it. Are they all so shortsighted as to not recognize what they are allowing? I guess the answer has to be "yes".