dagblog - Comments for "Too Big to Fail: Why Government as a Business Doesn't Work"

I think this needs to be

Peter Schwartz — Fri, 07 Apr 2017 01:43:00 +0000

In reply to We complain about treating

I think this needs to be parsed more finely, and I'm not sure I'm up to it.

The closer you get to Bernie, the more you find people who treat businesspeople as pariahs.

To some degree, this view has intensified with the financialization of the economy and the yawning inequality. In short hand, people see Wall Street as the culprit because they don't "produce anything" and because they make truly insane amounts of money. Also, boiling a business down to maximizing "shareholder value" does make workers even more expendable than they were before. The horizon is so close. Hillary spoke about this as a problem, and she was right. It goes along with anti-unionism, the discarding of defined benefit pensions, and good health plans. If we somehow--and maybe we can't--could get back to the way businesses used to be run, then the animus toward business people might subside a bit.

My view is more that not every organization is a business. Therefore, it doesn't follow that businesspeople will be particularly good at running any old organization, especially the government. They may have skills that will apply and have an important role to play, but it doesn't follow that Mitt would've been a good president just because he made a lot of money.

As to artappraiser's comments, I don't know what to say. Polling has been so whacky, it's hard to tell what the electorate thinks anymore. However, we are clearly experiencing a wave of populism, and Bernie had a surprising amount of support. People pound me on this point all the time on FB. "The Democratic establishment is dead, etc., etc." Not that I'm starting this conversation back up, but I'm genuinely unsure whether Bernie would've beaten Trump. Until recently, I felt strongly that he would not have--now, I'm [not - pp] so sure. I don't say this as a partisan, but as an attempt to gauge the public's sentiments.

I think that hurts the Dems

artappraiser — Wed, 05 Apr 2017 20:56:36 +0000

In reply to We complain about treating

I think that hurts the Dems alot. And it also hurts candidates like Bernie. There is a lot of visceral dislike of the traditional Dem. party platform, it is a dislike of a socialist attitude, i.e., FDR to LBJ not being conducive to modern times. That is what the DLC was all about, not so much about chasing lost Reagan Dem racist Southerners but lost votes about anti-capitalism.. DLC outreach worked, helped Bill Clinton get elected. Th "a rising tide lifts all boats" neo-liberal thing helps win business people and a lot of swings. Obama's professorial seriousness about everything helped him some in this regard, I think a lot of this type thought about Obama like this: well, he's sympathetic to traditional liberalism, but he's smart enough to understand how our needs are important to the entire system.

We complain about treating

PeraclesPlease — Wed, 05 Apr 2017 17:03:15 +0000

In reply to Yes, this is correct. No

We complain about treating Trump supporters as deplorables, but treat business people as deplorables every day, especiall in finance ( acknowlegong 2008)

Yes, this is correct. No

Peter Schwartz — Wed, 05 Apr 2017 16:36:53 +0000

In reply to Well, Soros is a businessman,

Yes, this is correct. No doubt businesspeople come with certain management and/or entrepreneurial skills that can benefit almost any organization, government included.

The key is for the businessperson to stay true to the goals of the non-profit or governmental organization. Financial sustainability is probably still a goal, but you might not want to save a buck by cutting out half the opera season or by allowing a lot of people to die because it's more efficient.

The big argument in favor of the business model of running an organization is that you marshal the forces of greed and ambition to get people to do what you want them to do. You pay them, so you don't have to depend on their altruism, and you don't have to worry about their doing something else "on the side" to make a good living.

Motivations other than greed and ambition, in this telling, are less reliable in getting people to act the way you want them to act.

The big argument against the business model is that businesses are only good for accomplishing things that will turn a profit. Unless you can turn a profit doing X, a business model simply won't work. Business SKILLS can still be useful, but the business model won't work in that instance. It's like having a gun that, for whatever reason, will only kill birds. If you want to kill snakes and water buffalo, you need something else. The "business gun" simply won't do what you want it to do.

Also, starting a business is no sure thing. Many businesses fail. There are a lot of reasons for this, but one is that not enough people are willing to pay for the product or service at a price that would allow the business to turn a profit or at least break even. You can try new approaches, e.g., new products, changes to the offer, but you can't force it. You can't take a gun that will only kill birds and demand that it kill snakes simply because it is so good and efficient at killing birds.

With the government model, you at least get to pick your goals without respect to whether reaching those goals will turn a profit. To greatly simplify: If you want to do X, you can go for X. You have to convince a lot of people-- which, on the plus side, can mean a LOT of support for reaching your goal and not just the desires of a lone businessperson--which can be hard, as Trump is finding out.

Because business is such a big deal in America, Americans have this constant thought that the government should be run by businesspeople. In fact, most of our best politicians have not been businesspeople.

Well, Soros is a businessman,

PeraclesPlease — Sat, 01 Apr 2017 05:02:00 +0000

In reply to The business meme is part of

Well, Soros is a businessman, Gates is a businessman, Ben & Jerry is a businessman, Elon Musk is a businessman, Nolan Bushnell is a businessman, Oprah Winfrey is a businesswoman, Beyoncé is a businesswoman, Arianna Huffington is a businesswoman, Woody Allen is a businessman, Michael Jordan is a businessman, etc etc. Business folks come in all shapes and sizes. The Republicans have tried to win the propaganda field of what a businessman is and how businessmen are naturally Republicans, but it's simply not true. Many businesspeople have concern about the environment, don't steal, pay their taxes, etc, and feel they are providing a needed public service, though most will guard conditions that keep their businesses growing - I.e. concern about government rules and regulations that go too far.

In reverse order health care

Flavius — Sat, 01 Apr 2017 02:17:35 +0000

In reply to "rely as much as possible on

In reverse order.

Health care should be public. I know that Kenneth Arrow was once

supposed to have written the definitive analysis of that topic. I´ll have to take that as a given since I´ve read it without understanding. The nearest I can come is that the relative bargaining strengths of Big Medicine and Joan Consumer are so unequal that this market behaves like an oligopoly. Have I told you of the world wide price fixing session I attended once?

I won´t .

What should be private? I was a businessman not an economist but clearly ¨should¨

invites the response : ¨according to whom¨ . And ¨according to what critera¨ and who gets

to choose. The ¨Lord of the flies¨ comes to mind. Or maybe ¨The Lottery¨

My knee jerk answer is :¨Almost Everything¨ . But regulate the hell out of anything the electorate chooses..

And make sure no one hacks the count.

The business meme is part of

rmrd0000 — Fri, 31 Mar 2017 15:33:40 +0000

In reply to Yes, that's one of the usual

The business meme is part of how Reactionaries view government. Businesses are efficient and give profit to stockholders. Businesses create jobs. Government does not create jobs (Ivanka, Jared, Kellyanne, Omarosa, Sean, etc. are not workers). Taxes represent theft from the citizens of the United States. A businessman has no problem cutting off Meals on Wheels and sending Kermit and Elmo packing. Liberty comes from limited government. Reactionaries do not care that businesses can pollute your air and water or sell your information without your permission. Being a serf is a risk of the "freedom" you gain from less government. What is good for business is good for America. It is tradition.

Edit to add:

Scott Pruitt at the EPA overruled the scientific advise of his agency and allowed the continued use of a pesticide associated with brain damage in children. Corporate profits over public safety, A clear cut business decision.

http://www.huffingtonpost.com/entry/scott-pruitt-pesticide-chlorpyrifos_...?

Yeah, saw that earlier. Kid

PeraclesPlease — Fri, 31 Mar 2017 14:57:00 +0000

In reply to I was going to post this In

Yeah, saw that earlier. Kid who took over his prison-destined father at 26 and is basically an arrogant front for his father's multi-billion dollar empire - felons can't sign. Dad had to pay $3 million twice to get Jared accepted into undergrad and then grad school Think he's smart enough to reinvent government if he can't even pass his SATs? Paid double value for 666 Fifth Avenue at 27, as we were heading into a recession - then went begging to the Chinese for a bailout before finding some bucks from shadier types. Now he'll get to discuss 666 with the FBI to see what he was negotiating with the Russians and Chinese after dad-in-law got elected Prez. Who knows, maybe he'll get his father's old cell.

Think I'll go watch "Once Upon a Time in America" again - great movie about New York's Jewish mafia. Too bad Charles Kushner's so thin - would be great to have DeNiro reprise his role with him. Elizabeth McGovern was a sweetheart as well.

I was going to post this In

CVille Dem — Fri, 31 Mar 2017 14:14:11 +0000

In reply to Too Big to Fail: Why Government as a Business Doesn't Work

I was going to post this In The News, but here seems a great spot for it. It is a former employee of Jared's who knows her stuff, and she thinks he will not do well with his latest task:

https://www.washingtonpost.com/posteverything/wp/2017/03/30/i-worked-with-jared-kushner-hes-the-wrong-businessman-to-reinvent-government/?utm_term=.39c7ce2f10df

Yes, that's one of the usual

PeraclesPlease — Fri, 31 Mar 2017 14:04:00 +0000

In reply to A healthcare insurance

Yes, that's one of the usual complaints.

My point is simply that most businesses are designed to fail within a fairly short, finite period of time.

This article gives the typical lifespan to bankruptcy or being acquired as 10 years. It notes that companies 20 years or older had a fairly consistent chance of both bankruptcy and acquisition in any year. The authors also note that very few of the businesses cease early on, leading them to speculate that they usually have funding and other measures lined up for adolescence.

What this means as regards my thesis is simply that there's no real smart way to surviving as a business - it's a fairly consistent failure rate and almost no businesses make it past the long tail of that curve. So the idea that you might get the brightest together to run the US successfully as a business is likely sheer delusion - if you have smart people (or other factors like well-connected, diverse, industrious, God knows what else), you may place high in the survivors' circle, but you're still almost assuredly dying or being gobbled up in a relatively short time-frame whatever genius you pull out of your hat.

And note that this is true for pretty much any industry starting at any point (though survival was easier coming out of WWII).

And the reasons for that is likely that the particular kinds of competition and game theory and other threats & opportunities are pretty similar across the board. Government of course games the table to be risk-averse and assured of survival, especially in ability to raise funds by fiat, but also to regulate threats out of existence.

Eastman-Kodak went out of business despite having invented the appropriate replacement technology that took the world by storm. "Congratulations, you are a certified genius. Now clear out your desk and grab your last paycheck on the way out." Yep, I remember when there was the question of Detroit just "simply" shutting down - which businesses do all the time. Anyone notice a subtle distinction between the two?

So when people say they want to run government "like a business", ask them what they mean, to define it, as it doesn't even make much sense. Governments are akin to a business with most of the profit motive and fear driven out of them to start, which means it's not much of a business at all. Even "messaging", as opposed to marketing, is quite dissimilar. Can government be run more or less efficiently? Sure, and a few of those factors relate to private industry but a whole slough don't. And it's quite obvious they don't. So why does these idea keep coming up - both that business leaders are somehow more successful at survival - they aren't - and that those skill sets can apply to government - they largely can't.

Combine that with private industry rapaciousness that both Obey and Flavius bring up, and we see a pretty weird masochistic trait - "hey, let's go play chicken with explosives taped to the front of our cars!!!" Uh sure, it can be done, and that's about the best that can be said for it. Al Gore did some interesting things with "reinventing government" (including the 2nd infusion for the internet), but that's quite a different approach.