Monday, October 29, 2012

You Can't Run Government Like a Business

This column appeared in the Sun Chronicle on Monday, October 29, 2012.

If you've heard it once, you've heard it a thousand times. It is often said about government at all levels. If you believe some, it is the simple answer to many of our pressing societal and financial problems. Yet it always makes me shake my head in amazement. What is this popular theory?

“We need to get businesspeople into office, and start running government like a business.” Yeah, right. Run government like a business. That’s the answer – not.

Trying to run government like a business is a bit like hiring Bill Belichick to be President. He’s got a great and useful skill set – but not for that particular process and goal. He understands the value and need for hard work in order to be successful, but has achieved that success because he controlled and dictated the rules of the organization he has so brilliantly run. Put him in a total government environment and he will have definite problems.

Imagine Coach Bill holding a press conference and having to explain virtually every aspect of what he has done. Or fielding calls from concerned citizens who have helpful suggestions on what should be done. Better yet, try and picture the Patriot coach presenting his budget to Congress and having to lobby for their approval. Like football, government takes a team approach to success. But unlike football, government does not concentrate the power and authority to make the key decisions in the hands of the professionals.

Government is not a business. It is not an entity that is supposed to make a profit. If a government worked perfectly, it would provide for the basic needs of its people and spend exactly what it brings in and not a penny more. It doesn’t try to win, it doesn’t manufacture a product, it doesn’t get handed down from generation to generation (unless of course your last name is Kennedy or Bush).

Government is something unique. It doesn’t have shareholders, it has citizens. It doesn’t have bosses, it has leaders. Government doesn’t have many of the luxuries that businesses enjoy. For the most part, governments can’t “go out of business”. They can’t just wake up one morning and decide they are no longer going to be in the education business or put forth a strong military because it is costing them too much money to do so. When businesses have a product or service they can’t produce profitably – they drop it. They operate under the principle of supply and demand.

When you operate a business, you can make difficult decisions in private. Your deliberations are between you, your staff, and your owners or shareholders. They aren’t on television, there aren’t reporters sitting in the audience ready to write down everything you say. Your every mistake isn’t broadcast to the public at large. Is it any wonder good businesspeople hesitate to commit to public service?

There is no doubt some of the principles of good business also apply to government. But when you run a business and need to buy a piece of equipment, you go out and make the best deal you can. When you need that same piece of equipment in government (at least here in Massachusetts), you have to go out to bid. You find yourself at the mercy of bidders who know they have a captive audience. Just look at the cost of constructing a public building as opposed to a private one.

We say we want government run like a business, but we really don’t. We give our government rules that prevent that from happening. Of course, the reason for those rules is that without them government often falls prey to corruption and cronyism. But the price for transparency in operation is often quite high.

When businesses have great years and do well, they often expand. They add product lines. They employ more people and increase their technological capabilities. They grow into new areas. Government expands too, sometimes to do what the private sector chooses not to do. But the reason is providing service, not making money.

If you want your leaders to treat government like a business, then we all need to act like employees rather than citizens. I don't believe that's really what we want.

Bill Gouveia is a local columnist and can be emailed at and followed on Twitter at @Billinsidelook.

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