After retiring from politics, ultraliberal Sen. George McGovern, who lost the 1972 presidential election to Richard Nixon by a landslide, fulfilled his dream of opening a small bed and breakfast inn in Vermont. But hammered by rules and regulations, the inn struggled to retain profitability and finally succumbed to bankruptcy.
After this small business experience, the senator lamented that government interference and micro-management of business through regulation is hurtful to the very people that the laws seek to protect-a rude awakening for a famous liberal thinker.
“Everyone is exposed to economic risks of some kind,” he said. “But we don’t operate mindlessly in trying to smooth out every theoretical wrinkle in life.”
One big problem with government is that the great majority of its elected office holders and regulatory bureaucrats have little experience in the real business world. Historically, an average of only about 10 percent of the appointees in Washington executive administrations had such experience. In the Obama administration, the number is closer to zero. It’s not surprising, therefore, to see the proliferation of regulatory agencies, regulations and regulators since Obama became president, although the Bush administration was no slouch in this area either.
Government “protection” hurts everyone by clogging the engine of the economy. This happens when the cloggers have no fundamental notion of how cloggees operate, except to believe that the latter are inherently corrupt. Moreover, they don’t care. Appoint someone to regulate and that’s what they will do regardless of the effect on profitability, costs, hiring or a business’s strategy. The objective is to build a bureaucracy, the bigger the better, as an indication and reflection of power. It is not to ensure the smooth functioning of the engine.
Would it not, therefore, be beneficial to the economy to have more people with business experience in high level positions in government, perhaps even the president? Indeed, with record budget deficits and federal debt equal to GDP, the added attraction of experienced business persons might be the ability to deal realistically with fiscal irresponsibility.
Alas, according to many in the media, as well as some candidates vying for the U.S. presidency, the last thing we need is a former CEO in the oval office. “A country is not a business” declared a lifelong academic/prominent journalist in a column. Yet someone with extensive business executive experience might be more cognizant of the real factors of job creation and the limitations of government spending in stimulating economic growth. That person might better understand that although not a profit seeking enterprise, a country and its citizens become prosperous through the expansion of production, not government. At the very least, someone with business experience would have an appreciation for the economic freedoms that spur innovation and create global competitive advantages.
No, the country is not a corporation, but it’s not a community organization either unless you view the entire U.S. electorate as one big protest movement. And that’s what we have: a weak economy with everyone protesting. Maybe it’s time to stop the protests and get back to work. Maybe a good CEO can make that happen.
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