Can you spot the perfect businesses?
What business enjoys recurring/passive income, no competition and a market that extends to 100% of the population? What business is self-perpetuating with no threat of failure as it enforces collection of receipts via the force of law? What business can endlessly borrow and print money? And because there is no competition, what business has the enormous advantage of being able to sell a product or service that is often of marginal quality?
Yup. It’s the government.
Every government is a business and like other businesses, government-businesses come in a variety of shapes and sizes. And like other businesses, they range in quality from excellent to horrible. What is the service provided? Originally, in the birth of America’s federal government, the primary service was to protect the freedom of the individual from internal and external threat. Now, although still providing that service, expanded federal government has inserted itself into virtually all areas of personal life as it regulates, taxes and absorbs.
Don’t argue with me. You know it’s true.
Think about it a little bit and then understand why, in the United States or in any other country, government is by far the largest business. The conditions for operation are optimal, expansion into new markets unlimited and the possibility of failure slight. What a perfect storm of self-perpetuation and market domination!
And note the quirky nature of the business of government: It isn’t in business to show a profit. The business of government is to spend money, and in spending money, to gain the favor of enough constituencies to insure its leaders their own continued leadership. Yet here is where a government system is no different from any other organic system: It is inherently interested in its own self-perpetuation, additional control over its environment, and growth.
In America, the government-business is not the limited entity that our founders envisioned, yet despite the current on-steroids expansion, it remains among the best when it comes to economic and business freedoms, property rights, etc. See the Heritage Foundation’s 2010 Index of Economic Freedom. in 2010, America ranks 8th in the world in economic freedom.
Planet earth has close to 200 of these government-business entities – countries – and they continually interact, sometimes cooperatively and sometimes uncooperatively. There are trade agreements, turf wars, stand-offs, etc.
And within any country there are government entities subservient to the national government. These sub-governments have their own arrangements for exacting funds from citizens in order to provide the services required and like the national government, to sustain and enhance their office-holder’s own existences.
Lately, in America, the trend is toward a more powerful federal government that stands by as sub-governments and individuals descend into economic malaise. Of course, the more economic malaise its subjects endure, the more the federal government has opportunity to incrementally gain additional control. Call these self-serving actions bail-outs, enforced social justice, wealth redistribution, social engineering, nationalization and so on.
Interesting to note that a national government’s massively inefficient regulatory and taxing intrusions are often the root cause of the economic malaise upon which it ultimately benefits.
Do we need governments, with their regulation and taxation? Yes, of course we do. Life without government services and regulatory oversight would be tribal and chaotic. The question is, how much government is necessary? In America, the founding documentation assertively insisted on government-minimization. It’s my personal contention that the self-limiting thread of America’s original documentation is the reason the country developed into the super-power that it is. Americans were allowed to prosper without having to contend with an imposing government’s overbearing drain on resources. So, with government’s encouragement, our economic system stayed lean and systematic as it built upon itself from within. Lately, not so much.
In a twisted kind of a way it’s intriguing to watch a government system in action as it userps energy from the private sector system it supposedly serves.
If you own a private business, or work for one, you’ll relate to this: My partner and I own and manage a small concern, Centratel, in which the wages we pay our employees are reduced by a payroll tax that is 7.65% of each employee’s total pay. Then, my partner and I pay and additional 7.65% per wage-dollar out of our own profits. Whatever profits are left over are income-taxed heavily by the federal and state governments. And of course, our employees pay income tax too. (Well most of them do. Some of them get tax credits for one reason or another and are part of the 47% of the population that pays no income tax whatsoever but instead, more often than not, receives money back from the government in some form of subsidy.) Alas, no one escapes the payroll tax except those involved in the ever-burgeoning underground economy.
State and local governments get their share in income tax, property tax and/or sales taxes along with a broad variety of other additional assessments. I mentioned this before: In the United States, almost everything in daily life is taxed and/or controlled by some government entity or another. A few weeks ago the federal government decided that it would regulate personal health care choices. Soon, if cap and trade legislation passes, even the environment will be taxed and overseen. And this is in America where, even with the increasing encroachments on individual freedom, things aren’t yet as stifling as most other government-businesses that range from European social-democracies to African dictatorships to middle east religious theocracies.
Of course, like everything else, it all boils down to control. As individuals, we spend our lives seeking more control because it is the singular antidote to the terrible opposite of being out of control. It’s only natural that the human-born business of government should also seek more and more control too. For government leaders this control-quest is about insuring their own survival and the growth of the government itself. And nowadays, survival and growth are sought through vote-pandering to a host of constituencies. Government in America has shifted emphasis from the Constitution’s original intent of protecting individual freedom, to an entity that endows vote-getting entitlements. Mechanically speaking, this emphasis favors non-productive people over productive people and so a downward spiral ensues. Even a perfect business can be mis-managed. Trouble lies ahead for this inefficient government-business so there will have to be adjustments in order to make a management change and to shift back to a culture of efficiency. Here in America, we do that management-adjusting at the voting booth.
And so, as always, we arrive at the subject of efficiency. If a primary system’s resources are wasted on efforts that have nothing to do with the continued well-being of that system, or are simply drained away into an unrelated system, the primary system will degrade, tending toward chaos. However, if the resources of a primary system are thoughtfully reinvested back into that same system, the system will thrive.
The beauty of America lies in the brilliance of the constitution which stipulates that we get to tweak our government business system on a regular basis. Any man-made system needs its regular maintenance and adjusting.
In any case, and despite the ebbs and flows, by getting outside and looking down on the system of government, a profound teaching moment arrives: When you think of starting or operating a business for yourself, think dispassionately of this perfect business and try to duplicate its strategy. You want money to come in a steady stream. You want that cash flow to happen automatically. You don’t want any problems collecting the money owed. You want minimum competition. You want to have the back-up resources to survive the occasional inefficiencies. You want to name the price.
Most of all, and in order to obtain the above perfect-business outcomes, you want to become as efficient as possible. Of course, you will create that efficiency in a regulated and controlled way. Government will see to it.
{ 29 comments… read them below or add one }
The premise is false. A government is NOT a business. A business makes things that people are free to buy from them, from a competitor or not at all. The ultimate purpose of a business is to make money.
A government is neither of those things. You don’t get to choose your government initially, though sometimes people can move to live under one they like. And the purpose of business is, according to the US declaration of independence to secure people’s rights to life, liberty and the pursuit of happiness. I also like the purpose defined by Abraham Lincoln: To do for people what they cannot do at all or do so well for themselves.
It seems to me that collective protection against the financial devastation that can come from a health crisis and indeed access to adequate health care is certainly a thing people cannot do so well for themselves and it certainly secures one’s right to life not to mention pursuit of happiness.
As exhibit A I give you the numerous countries of the world that have better health outcomes while spending less money. As exhibit B I give you the huge number of bankruptcies in the US that are caused by a health crisis. As exhibit C I give you the thousands of people who die each year in the US from preventable causes simply because they don’t have access to adequate health care for financial or other reasons.
As a business person, I find it easier to grow a business when neither my employees or my customers have to worry about their health, nor have to make choices about should they spend their money on medicine or my products.
And that’s just healthcare. Can you imagine doing business without roads, postal service, the internet, a well educated workforce and customer base, a (mostly) functional court system to enforce contracts? I can, but I prefer to do business in the US.
Taxes are not all bad for business, though I agree they could be administered in a smarter way and spent much better. But don’t be deceived, they are not the purpose of government and government is not a business.
I forgot to say that healthcare is just one example. it would seem keeping the environment clean is another. And this will all cost money.
John,
For exhibits A, B, and C, you fail to cite a single reference or example. Seriously the whole “environment / green” mumbo jumbo is really getting laughable. Continue to get your “scientific” save the world info from ellen degeneres and bon jovi … you’ll be just fine:)
An overwhelming majority of people (85%) in this country have the best healthcare in the world for the simple reasons that they a) work and b) have made simple right choices. For crying out loud you can work minimum wage at McDonalds or Walmart and have coverage that trumps the majority of the world.
Sam, Keep fighting the good fight. I for one am getting sick of being penalized for everyone else’s laziness and poor decisions. I work every day to support my family and have money to “FREELY” donate to charity and people in need.
33% of my income goes directly to a system that has failed repeatedly to use that money wisely.
Chris
We only have a few more months til the democrats are swept out of office and hopefully things will turn around and freedom will be restored.
Sam, great article. As for John’s concern that a government is not a business, I think he’s taking your point too narrowly. Businesses come in many flavors and in many countries (increasingly, our own as well), there are these horrible quasi-private-quasi-governmental “companies” that are the worst combination. Then you have the whole “non-profits” which I now call “companies that make no profit for anyone other than their employees”. At one time in our country, at its founding, I would agree that government was not a business. But now? Of course it’s a business.
I agree with Mr. Seiffer that government is not a business, at least in the sense of having an ultimate purpose of making money. That being said, Mr. Carpenter’s view of the government as business is not far off the mark if we view government as a not-for-profit business. Government, itself, is not profiting from its expansion; although similar to an expanding not-for-profit, some of those involved and employed in its endeavors will at times take advantage of the enterprise and unfairly enrich themselves.
Whether government is a business or not is a moot point. I think we can agree that government is an enterprise or an organization with a purpose and a mission to fulfill. Those who founded this country felt an organization was indeed necessary – they didn’t say government is wrong, or bad, or useless. Government is not the problem, government is a means to an end; government is the solution. We can no more live without government than with out clean air, food and water.
The history of human civilization is the story of ever increasing complexity of social interaction, specialization, and interdependence. We are not a nation of hunter gatherers or subsistence farmers or goat herders. As a young nation we were further along than that already, yet some some of the electorate of the time were at that level. Civilization today is several orders of magnitude beyond what it was when we began this magnificent experiment in social organization known as the United States of America. The rate of growth in civilization’s complexity is increasing exponentially; in the next 50 years, barring some sort of major calamity, we’re likely to have progressed farther than we have in the last 200.
To somehow expect that our government would be simple and minimal when our lives as individuals and communities are increasingly complex is unreasonable. It’s like expecting a bucket brigade to be adequate to deal with a towering inferno. I’m not arguing that bigness is a virtue, nor am I arguing that government has been successful in every instance. I am saying that smallness, in and of itself, is not an answer to its failures.
Now, back to business, for I believe there’s something we can learn from business to make our practice of governance more successful. If you were to poll the CEO’s of the most innovative and successful companies of today about their most valuable asset, they’d say it’s their people. This is in alignment with the founding principles of our country: WE the PEOPLE … ; not as distinct from government, not against government, but creating government to nurture and further the dignity of our most precious asset – the PEOPLE, and their right to life, liberty and the pursuit of happiness. Not just some of them, ALL of them.
Those CEOs will tell you they have their greatest asset, their people, engaged in eliminating waste and creating value. They’ll tell you that the #1 wasted resource in this country is human potential. They’ll tell you they work together with their people as a team to find the most efficient processes to create goods and services of value for their customers.
I believe we spend far to much time and energy bashing government, people and organizations; and this doesn’t get us much more as individuals or groups than a sense of righteousness for ourselves as individuals and as groups. Problems go unsolved, opportunities for our collective well being and advancement go unrealized. More interested in shame and blame, we fiddle these tunes like Nero while our empire burns. While Mr. Carpenter pays lip service to efficiency which should be a priority for us as a nation and which is our duty as good stewards of the great fortune Providence has endowed us with, he paints government more as a necessary evil than as a necessary condition of the freedom and abundance we are so privileged to enjoy. He disrespects the inspired innovation of our forefathers speaking of it as if its sole purpose was to control and oppress us, and tax the hell out of us.
Government, regardless of its size, is not inherently evil. Taxes are a necessary condition for government to exist. People are not lazy and stupid, as Mr. Macyntire would have it; they’re an under utilized mother lode of an asset. Nor does any one political party have a monopoly on intelligence or righteuosness. Focusing on such spurious “issues” gets us nowhere, accomplishes nothing of value whatsoever. Indeed, it is profoundly wasteful. The problems and the opportunities that confront us are as complex and mulitfaceted as the civilization we live in. Government must reflect that complexity in order to be of any use, and it needs an electorate that’s willing to use it, not one that pretends its unnecessary or useless.
Hi Sam,
I agree, government is a necessary entity. But the first rule of government is the preservation of government, usually at all costs. You hi-lite many poignant aspects of a government gone astray, but it seems to be a global systemic virus.
I’m from Canada where we’re supposed to have that excellent government healthcare. Although it has it’s virtues it has tremendous short comings. People here do not get adequate care in a timely manner. You might well wait in line many hours to several years to get care that would save your life or be able to help you in time to at least have some meaningful life left.
Wait times are ludicrous. 9 months for an MRI … 9 months to 2 years to see a specialist … and I won’t even get on my soap box about the long wait times in the emergency departments of hospitals. People are dying waiting.
Then there’s the aspect that many often don’t associate with Canada … the prospect of selling your home to pay for much needed, necessary care and get it … where? …. in the USA or elsewhere.
Nothing is so vile as to be told you must wait 9 more months on top of the 18 months you’ve already waited to get in to see the specialist while in the mean time you’re in unbearable pain and losing the ability to use your limbs and the pain meds are damaging your liver, your kidneys, your heart and are addictive and cause hallucinations.
Adding insult to injury is not only the wait times, but if you can afford to pay for your MRI you can go to the exact same clinic that makes you wait 9 months and get in tomorrow morning! This in Canadian health care. It’s great for colds, flu and the odd heart condition, and broken bones, but lets our citizens down when it comes to state of the art health care … and who can blame any doctor for the financial decision to move to the US for better pay, more opportunities and better access to cutting edge science?
Kudos for the doctors who do stay and try to make a difference … they’re working as hard as they can, but the system is failing. A balance of government backed and privatized might be the answer so that the one is not swamped to the detriment of the other (of course they should be separately run facilities to avoid what I mentioned earlier).
I have watched helplessly as a family member lost their home (had to sell it to pay for needed care) here in Canada to pay for services that should have been covered, but weren’t and the type of surgery required wasn’t even available here. And you wouldn’t believe the number of other Canadians he met going through the same thing. Some are homeless or living in travel trailers or have moved in with their kids.
Even his most expensive medications were excluded because they fell outside of the “guidelines and rules”. And of course those rules change from one province to another. What’s covered in one doesn’t mean it’s covered in the other province. The devil is in those nasty little details!
Fully funded healthcare sounds fantastic … but it will be not only inefficient, and an unbelievable drain on the populace, but it will eventually fail because of an inability to supply necessary services … as a result of cost inefficiencies!
You have a chance to avoid the pain that many Canadians are going through in our healthcare system here. I hope the financial disaster that happened in the Weimar Republic never sees a repeat here in Canada or the USA, but the way our governments are spending I’m not going to hold my breath.
You can’t spend your way out of your troubles. Somewhere the buck stops with someone. That someone is you – the taxpayer. It’s not some faceless entity. That money comes from your mouth. Think you don’t have enough to feed your family now? Wait and see how much more stress you can take.
Just like some government is a good thing, some healthcare is a good thing, but ultimately everything from your home, your personal choices and your spending habits, to government and the pursuit of happiness all boils down to efficient use of resources and capital. Stray from that and further burden an already over-stretched people … and well … the state of the economy says the rest and their solutions aren’t solutions … they’re bad bandages … and we all know they’re leaking badly.
Weigh your choices carefully. Vote wisely.
Hi Sam,
I must say that reading the comments so far, I am glad I live in Australia. Ranked third in the world for economic freedom, we came through the GFC relatively unscathed by global standards. We have both public and private healthcare providers, and, although the healthcare system is about to undergo reform, EVERYONE is insured, either publicly or privately. This is considered a basic human right within a democracy.
Our two major political parties–Labor/progressive and Liberal/conservative–do best when they capture the broad middle ground. This “centrist”position does not mean, though, that we do not have people operating at either extreme–we do. But, if introduced, extreme policies and practices are not likely to remain entrenched; we are more likely to swing from being socially progressive to being economically conservative, in cycles.
To my knowledge, no one in Australia has ever considered the government to be “a business”. In some ways, government agencies are the exact opposite of businesses. Imagine if Centratel had no choice but to accept as clients the most difficult and dysfunctional members of the general population, in ever-increasing numbers and with ever-greater demands, with no guarantee of being allocated commensurate resources, and in fact being almost guaranteed of having to always and forever operate under-resourced? Welcome to protective services and out-of-home care, health and mental health, policing, corrective services, and juvenile justice, to name just a few of the essential, non-revenue-generating services we expect our governments to provide, with very little thanks when things go right and lots of whinging when things go wrong.
Just one other thought: I do appreciate that Americans treasure their Constitution, and rightly so, but surely, as societies evolve, we need to review and update even our most treasured traditions and sources for civilisation? If we are always looking backwards over our shoulders to what was enshrined in the past, we run the risk of limiting our performance in the present and being blind to our true potential in the future.
Helen. The thrust of my theme, “government is a business,” was sarcasm. Regarding your “not looking back” thoughts: That is a convenient posture as not looking back also means that we won’t examine history to see that socialism has been a failure everywhere it’s been tried. Every major world horror story has been via socialist or fascist dictators, people who tried to call the shots for their people, and enforced their vision of how things should be. Social democracies such as in western Europe and Australia do alright as they have had the U.S. as a protector of freedom. America can’t afford the social programs AND the military presence. We will fail if we try, and that means Australia will be, for the first time, on its own against the despots of the world. So will western Europe. Linda and I had an interesting discussion last night as I told her how I had converted from a liberal to a conservative. She said, no, you haven’t changed, Sam. You have always questioned authority. That was a revelation to me. I have NOT changed! It’s my “fight the machine” brothers and sisters who have changed and now they are in power. Now, they are “the machine.” I say, “always question authority!”
Hello again Sam,
Thank you for your reply. More food for thought below?
* Sarcasm………..mmmmm?
*I think you may have misunderstood my “not looking back” reference; I should have given more detail.
Of course we have to reflect upon and review and evaluate the past. That is essential for determining what is working and what is not and either keeping-on or making changes as necessary (recalling that one definition of “insanity” is: Always doing the same thing while always hoping for or expecting a different result/outcome).
However, we have to be wary of becoming enthralled to and limited by our heritage and traditions. All societies have their sacred texts and treasured founding documents and principles, but these were set-down in times long-gone by forebears who were, we would like to think, less socially and culturally evolved than we are today. Indeed, an indicator of maturity is that, as adults, we review the traditions and belief systems we inherited from our parents and grandparents, and retain, revise or delete these traditions and beliefs in light of current knowledge and understanding of how the world works (and science, in its various disciplines, remains the best means we have for testing reality and providing us with that knowledge and understanding). Religion and politics are two obvious subjects (or objects, really) for such review and revision.
It is certainly not for me or any other non-American to comment on the adequacy or otherwise of the American Constitution. I have no opinion one way or the other. I wonder, though, whether some Americans have an unquestioning reverence for and deference to this document, as though its wisdom were set in stone, forever unchallengeable and unchangeable. My point was, simply, that the Constitution was laid down in the founding years of your nation and it should not be above tweaking for today’s circumstances, if necessary.
*Your statements that “socialism has been a failure everywhere it’s been tried” and “Every major world horror story has been via socialist or fascist dictators” are only partly true. Firstly, there is a world of difference between the forms of socialism operating in various developed and developing countries today and the fascist regimes of yesterday. Also, communism may have collapsed in Russia and Eastern Europe but it is alive and well in China, the fastest-growing economy in the world. Secondly, the atrocities committed by the fascists in the 20th century were no less terrible than those committed by the representatives of Christianity in earlier periods of history (the Crusades, the Spanish Inquisition, the witch hunts of Europe and America), and we can note the current and historic child sex abuse scandals engulfing the Catholic Church worldwide. Religious and political ideologies can be equally regressive and corrosive.
*Australia cannot be characterised as a “social democracy”. It is a democracy with a diversity of minor political parties and a strategic balance of (left-wing) progressive and (right-wing) conservative forces courtesy of the two primary parties of Labor and Liberal. Despite our increasingly pluralistic society, our roots are in the British Westminster parliamentary system. Neither unregulated, free-market capitalism nor state-sponsored socialism is likely to become the dominant paradigm. That is one reason why Australia enjoys reasonable freedom and prosperity.
On the other hand, you seem to imply that the only reason that Australia is relatively well-off is because America is outsourcing so much of its national budget on military protectionism. We Australians probably do not appreciate America’s international policing role as much as we should. As well, the US is enormously generous with its foreign aid, so much so that it is probably taken for granted by one and all. But, as with everything, there are qualifications.
First, there is a perception, probably world-wide, that America intervenes in the affairs of other countries, albeit fascist ones, for its own self-interests as much as for the interests of global freedom and democracy. The 2003 invasion of Iraq is the most recent example, and it still polarises public opinion here in Australia and elsewhere in the West. Of course, among Muslims there is no doubt that Americans are murderous, immoral invaders.
Second, the world does have several international bodies, most notably the United Nations, that are charged with the responsibility of creating and maintaining peace among all member nations. The UN is by no means a perfect or even an effective organisation at this time, but we really have no choice but to keep working to improve and empower it. The US often places itself outside of or at odds with the UN and, by definition, the international community.
Third, Australia is a small island nation in South East Asia. It has a long tradition of “punching above its weight” when it comes to fighting alongside its allies in various wars, typically fought on the other side of the world. We supported George W Bush in America’s invasion of Iraq in 2003 and we still have troups there to this day. We also have a presence alongside the US and other western allies in Afghanastan. Our contribution is small compared to that of the US, but it is proportionate to the sizes of our respective populations. Finally, Australian troups are deployed in various trouble spots in our region, and we also have a large foreign adi program. So, in theory, if a small democracy like Australia can implement social programs internally while sending troups overseas to fight for freedom, then the world’s largest democracy–America–can too.
*Sam, you are quite well-adjusted if you can recognise both “liberal”and “conservative” characteristics in yourself. The concern is when we become blindly wedded to one extreme or the other.
Sorry, third bullet point (*), first paragraph, sentence beginning “Secondly…”, should read “no MORE terrible”.
I find it interesting how easily we throw out words like “socialism ” fascism,” “capitalism,” but in many case these references are not even used in their proper context. We all think we’re experts at solving incredibly complex issues and problems.
It’s not capitalism or socialism that makes a society succeed or fail. It’s the good or evil at the core within that society. Greed and corruption are rampant in America right now and that is what needs to be rooted out–in both the government and corporate world. We don’t run on an either or.
Regarding the recent health care reform-I have found that in most cases the people who opposed the reform have good health care plans. I find that most people that support health care reform–don’t have adequate coverage or have no coverage at all.
What’s disturbing about the rhetoric is that more often than not, we seem to oppose policies b/c they don’t directly meet our self interests. I would venture to guess that those of you that do not support health care reform plan on accepting social security and medicare when you qualify. It’s really sad. I wonder if we’ve really become a society that only cares if it’s our “ox that’s getting gored.”
Statement like “America has the best health care in the world” only means something if you are one of fortunate individuals that actually has access to affordable and quality health care–it’s not the best in the world if you don’t have it–and isn’t that the real issue? If we’re such a great nation, then why do so many people struggle? Why are so many people w/o health care? Bad choices on their parts is what I hear most often.
It isn’t all about people making BAD choices. In 1993 my 9 year old son was diagnosed with a brain tumor. We were fortunate to have a really good health care plan–our out of pocket expenses were between $10,000 to $15,000 thousand dollars (remember that was 1993–so add inflation). We had to travel to Bethesda every three weeks for treatment. Families from all over the nation were there — we were the ONLY family that had not gone BROKE b/c their child was sick. These people did not make bad choices–tragedy stuck their families and the insurance companies interests trumped the greater moral good. The insurance companies dropped their coverage–That’s not how I define FREEDOM.
Hello Sam,
You stated, and I quote: “I have NOT changed! It’s my “fight the machine” brothers and sisters who have changed and now they are in power. Now, they are “the machine.” I say, “always question authority!”
Are you saying “the-powers-to-be” , the “brothers and sisters” in the Obama Machine are your friends, that are now in power?
Thanks,
Just asking!?!?!
Hello,
I wonder what Helen’s thoughts are on the Bible? She states: “I do appreciate that Americans treasure their Constitution, and rightly so, but surely, as societies evolve, we need to review and update even our most treasured traditions and sources for civilisation”. Should the Bible be reviewed and updated too?
The Constitution of The United States of America was laid down by our fore fathers as a tried and true guide by which to govern THIS GREAT COUNTRY! Our ancestors left countries governed otherwise for the freedom and sovernity THIS CONSTITUTION GUARANTEES OUR PEOPLE. If someone wants to live under a government run differently, (i.e.) socialism, (etc.), I would suggest they find a country that suits their needs, instead of trying to REMAKE The United States Of America.
Helen further states: “It is certainly not for me or any other non-American to comment on the adequacy or otherwise of the American Constitution.” I AGREE!
I agree with Sam, “America can’t afford the social programs AND the military presence.”
Our social programs, I’m sure, are quite extensive compared to most other countries. Unfortunately, it seems we are becoming an entitlement society. Instead of teaching people how to take care of themselves (in so many ways), so they can enjoy prosperity, self dignity, and the freedoms that go along with that, our government thinks it is best to give them a hand-out in every instance, instead of a hand-up. It keeps them dependent on government, (i.e.) modern slavery. After enough years and generations, they won’t know or remember what TRUE FREEDOM really is.
YES…… ALWAYS QUESTION AUTHORITY!!! WITH PEACE AND CIVILITY.
I can’t add to that, Chris. Thanks
The point of my essay was to say that smaller government is better government, that individual freedom is the thing that has always made America special, and that I personally resent having the cards stacked against private enterprise by professional politicians who haven’t got a clue and are simply power-hungry.
Kyle. Sorry I was not more clear. My point was that those in power now are the same people who fought “the system” back in the 60′s. They have become “the authority,” ready to take over our lives in a magnitude those in power in the 60′s never dreamed. The cover-up is that they claim to do all this in the name of compassion when that is not at all what this it is about. This is about control and power. No, I do not stand with that. Call me a radical for supporting individual initiative, personal freedom and for wanting to not be taxed to death.
Jane: Your tone is partonizing. “Greed and corruption are rampant in America right now”? You need to travel more, say, to any third world country. Spend some time there. Live with a local family for awhile. Regarding this back and forth about health care, I am not sure how we all got into that. I didn’t come close to mentioning it in my essay. But, as long as the topic has been brought up, I think I speak for most conservatives who are beginning to get a bit resentful for being labled selfish and uncaring and even bigoted for disagreeing in how this particular “reform” has been legislated. YES we need insurance reform, but not a complete restructuring of society. Starving the golden goose and demanding even more eggs is simply not going to work long-term, and pointing that out doesn’t make a whole segment of society stupid and selfish.
Hello Kyle,
My thoughts on the Bible (the sacred texts of Judaism and Christianity) are the same as my thoughts on the Torah (the founding documents of Judaism), the Koran (the central religious text of Islam), and the Canonical Texts of the Bahai faith. But I will not elaborate here, except to invite you to visit http://www.peshertechnique.infinitesolutions.com, with an open mind.
I wonder whether you misinterpreted my comments about socialism, which were part of an exhcange with Sam? I certainly did not say anything that could be construed as my wanting America to adopt or convert to any political ideology and structure for governance other than what it has now. I don’t live in the US, so why would I care how it conducts its business? I simply challenged Sam’s characterisation of Australia as a “social democracy”.
There are many GREAT countries around the world, although we in the West are probably biased towards (pluralistic) democracies, which all have founding documents that GUARANTEE THEIR PEOPLE. As I said, I have no opinion one way or the other about the American Constitution. Rather, my comments were making a point about principle: It is not healthy for humans to remain fixated on concepts/beliefs that were introduced in bygone times, without reflecting upon and, if necessary, updating those concepts/beliefs in light of our current understanding and knowledge of how the world works.
In any democratic country there is a prennial debate about how to balance the rights of individuals to better themselves through merit, hard work and achievement (capitalism) and the need to protect and provide for the most vulnerable members of society–the young, the physically disabled, the aged, the mentally ill, etc.–(socialism). Many democracies, including Australia, have a military presence in the various trouble-spots around the world, commensurate with the size of their populations and resources. These countries also provide their citizens with social welfare programs. It is interesting for a non-American like me to read that America cannot afford both an external military program (admittedly a huge one, but then you do have a huge population and your country is resource-rich) AND social welfare (only for the needy and deserving, of course).
Helen: You are right. Australia is not a social democracy and, in fact, is put together much like the U.S. except your constitution can be changed relatively easily by a majority vote of your house and senate. But, let’s end this discussion as you are getting into a lecture mode of teacher-to-student and it’s getting tedious for those of us who have already made it through high school…and who actually live in the United States that you are so keen on seeing change to a progressive regime.
Your “exhibits” are not exhibits at all, but talking points with neither data nor examples to support them. Do you work in the government or something?
Hey Sam,
Smaller is better?
Size matters? Just how “small” should the government be? Too small to be effectual when the cards are stacked against it (and us) by private enterprises like big (gee, maybe they should be small too?) wall street firms with the power inherent in their free exercise of private enterprise to bring the world to its knees?
Too small to be effectual against a large multi-national energy company who in their free exercise of private enterprise may have ruined the economies of communities and the hard work and investments of individuals all along the gulf coast?
I guess every one of the smaller (which makes them better?) enterprises which have been/will be destroyed by the self serving acts of larger enterprises will take solace in the fact that their government is small. And they’ll comfort themselves while waiting two decades to have their day in the small judicial system court by telling themselves that they saved a bundle in taxes.
I have to ask, Sam, do you mow your lawn with a pair of hand snippers? (which makes sense if its just a couple of square feet. is it?)
Slogans, such as small government, free enterprise, and clueless power hungry professional politicians, don’t solve problems; they merely provide an emotional high, and a feeling of righteousness for those expressing them.
The point I was trying to make was that we must stop the slogans and the sound bites, and get down to some serious discussion and problem solving. Small government is not a solution, it’s probably not even an option, given the ever increasing complexity and specialization of the culture, the civilization and the world in which we live.
Efficient government is something worth talking about. Government that empowers ALL individuals in the pursuit of their own personal and communal enterprises should be our goal and duty as citizens.
If everything you have worked for, Sam, disappeared because of the subprime morgage crisis, and you were out of work, your mortgage foreclosed, and you suddenly discovered you had cancer but your insurance company was denying you coverage because of some technicality you didn’t quite get right on the application you filed with them ten years ago; would you be cursing “big government” as the cause of your problems? Would you be glad that there wasn’t any action taken on your behalf to prevent such circumstances from falling upon you? Would you just brush it off as bad luck?
I treasure freedom as much as you do. I’m an entrepreneur, been one since I was eight years old. My business has been severly crippled by the economic downturn. I’ll probably survive, but my life savings will be severely diminished. The view from my house is that my government, which had increasingly become “smaller” with respect to regulating the financial industry in its exercise of free enterprise is probably the only thing in the world that could have prevented this from happening. Am I missing something? Is there some “private enterprise” that could have prevented this? Or am I just “lazy” and did I “fail to make the right choices” (Mr. MacIntyre’s judgment, which you agree with, and further thank him for)?
Freedom carries with it responsibility. Freedom without resposnibility or accountability is anarchy, where might and wealth is the sole determinant of righteousness. Government is how we control this, regulate this, it’s how we keep the strong from overriding everyone else. Today, the strongest are stronger than many governments in the world.
Where do you think these power hungry politcians get their power from? Our votes? Our votes have become nearly meaningless because we’re voting for things like “small government”, stopping “power hungry politicians”, against “Washington insiders”, and ridding ourselves of “tax and spend” types. You strike me as a succesful businessman, Sam, does your business plan consist solely of slogans and sound bites? I think not.
Unless you are incredibly lucky, your business plan is detailed and has a certain complexity about it. As you have progressed, grown, and expanded, it’s unlikely that your business plan has gotten smaller, simpler, or extremely minimal. Given that experience, and the skill you’ve attained from that experience, how can you “slogan” about government being good only if it is small? It was your argument that government is a business, was it not? Can a small business solve intricate global problems with a shoestring administration?
Either you left your knowledge and experience as a businessman home when you wrote this piece, or you’re addicted to the emotionalism that comes from shouting slogans (spectator sports are a more appropriate arena for that, and have a less damaging effect on the success of the country you obviously love).
Small government and power hungry politicians are not issues, they’re emotionally charged statements. They don’t solve problems, they just allow us to vent. I imagine you have some cogent plans for solving the some of the complex problems that we face as a nation, but I haven’t seen that in anything you’ve written here Sam. Given that, I’ve got to say you sound a while lot like the some of the Washington guys you’d like to run out of town on a rail.
By the way, if you’re mowing your lawn with your clippers tomorrow, mind if I come help? It’d be a refreshing break from trying to figure out how I’m going to stay in business for the next 6 months because a “small” government approach to regulation made sure the cards weren’t stacked against free enterprise in the financial sector. Let me know.
Peter. I don’t even know where to begin.
Hi Sam,
How about if we begin here:
“These generalizations create a paralysis in which we don’t take any action at all, or we identify a problematic primary system, assume the entire primary system is faulty, and then try to force an overall replacement – without first examining the subsystem components.
Too often we go after a holistic, bumper-sticker solution when it would be more sensible to simply examine the primary system’s context and fix a faulty component. From the start, the overall primary system is probably better than okay, working well in most situations. Could we apply a minor internal adjustment to bring things closer to perfection instead of disrupting or replacing the entire system.”
(pg 72, Chap. 6, Work the System, by Sam Carpenter)
[Great book, btw, I love it! Couldn't come at a better time for me. I've been working in this direction, in fits and starts, doubting if I was doing the right thing at times, wondering if I should be more concerned about more immediate (therefore more "real"???) problems. Your book has not only validated me (thanks! I really needed that), it has empowered me and fanned the fires of a passion I now see I never should have doubted. Also, being a lover of language, writing, and the skillful exposition of thought, I've been delighted with your prose at every turn of the page. This is a book that will require very little note taking on my part to fully "grok" for the ideas are logically ordered and succinctly expressed. Far too often books of this nature require hours of panning useless river silt and sand to extract the gold that brought me there in the first place. This is not such a book. I'm totally certain that your father who impressed upon you the power of language at a young age would be very proud indeed of your writing.]
I liken our government to Centratel before your epiphany. I imagine that if a Work the System perspective and mind-set/methodology were adopted, Lean/Kaizen (continuous improvement) methods deployed across all departments, and an investment in R&D were made to develop innovative ways to serve the customer (we the people) in ever new and more efficient ways, an almost miraculous transformation would be possible. We might find ourselves with an even larger government than we have now, but one that empowers 98% percent of the people in the productive pursuit of happiness at a lower price than we now pay. Okay, the price may be higher, but the percentage levied against any “customer” would be smaller due to the value and wealth created by such an optimized system; which ALL customers would be enjoying in the form of a significantly higher standard of living, in all the forms that manifests in.
This is not a pie-in-the-sky airy fairy utopian dream – this has happened in isolated government contexts. The methodology employed has certainly been well established as an effective one in business contexts.
As you yourself state, “the focus must be on the proactive management of systems, not on coping with random system results,” and, “… a beautiful thing, this system-improvement process, because as time passes things improve. Imagine a system that improves with time rather than wears out.”
Respectfully Sam, and know that I have immense respect for you based upon your book, I’m left with a feeling that the same person couldn’t have written both the book and what I see on this page. Some of it sounds like complaining about random system results and the solutions of “small government” and replacing “clueless power hungry politicians” with some other kind of politician sound like a holistic bumper-sticker solutions.
I apologize for the “zingers” in my last post – I’m human and there are times when my passions occlude my commitment to both reason and to the respect of others. Let me restate: I can’t imagine the success of Centratel resulted from a concept like “smallness is the answer” in its Strategic Objectives. I imagine that some departments got smaller as a result of efficiencies effected, but I also imagine that they grew, perhaps substantially, as the company expanded as a consequence of the value and wealth created by those efficiencies. I imagine some systems were eradicated entirely, but that the ratio of eradicated systems to those that were kept was a small one. I also imagine that more systems were added, (maybe more than were deleted?) and that the current system is more complex and more highly articulated than before. Finally I imagine that Centratel is constantly on the lookout for new ways to enhance the lives of its customers and vigilant about creating value and eliminating waste in the ways it now serves its customers.
IMHO, this sounds like a perfect prescription for our dysfunctional government.
In your opening article there are at least hints that you agree with my interpretation of your book with respect to the topic of our government systems. In your responses to the posts of others – in what you’ve said, in what you’ve neglected to say, and in what you’ve chosen to emphasize – you seem to be going in the opposite direction. I should note here that I’m only up to chapter 6 in your book, so perhaps my understanding is incomplete as of this writing. I’m hoping you’ll help me make sense of it all.
I hope I’ve been successful in clarifying my thoughts and in so doing have given you the “where to begin” that you requested. I’m very interested in what you have to say about all this, Sam, and I anxiously await your reply. Thank you, for the book, for this “forum” and for your willingness to engage with all present here on this page in a conversation such as this.
Regards,
Peter
Peter. I very much appreciate your kind words about my book. You know, maybe I didn’t explain myself as well as I could have in my post. I constantly strain to keep the length of my pieces reasonable and so sometimes my overall message can get a bit abbreviated.
My take on life boils down to “the simple solution is invariably the correct solution,” and in this context I think it is obvious where you and I differ on government. You think it’s not big enough. I think it’s too big.
So, in my observation, the US Government is way, way too large and that largeness is responsible for many of our problems. For one, how can it be a good thing that i send 50% of everything I make to the government? How can that be a good thing? Why would I want to continue to do that and how can I be expected to want to continue to work and provide jobs when in 2011 I will be paying 60%?
Here’s another simple illustration: I have the U.S. Declaration of Independance and the U.S. Constitution on the table in front of me here, as I write this note to you. It’s a tiny book of a few dozen pages. In contrast the recent health care bill is 2,000+ pages. The contrast is between the entire basis of our country’s organization (circa 1787) vs. one legislative bill (circa 2010).
Here’s another illustration: The housing bubble and its subsequent crash were precipitated by the Fannie Mae and Freddy Mac failures; government programs in which banks were encouraged to make loans to unqualified buyers (banks would make a loan and then immediately sell it to Fannie or Freddy, thus freeing themselves of risk). These loans ultimately went bad leaving the taxpayer to pick up the tab.
The banking industry in the United States is already one of the most highly regulated industries in the U.S. or anywhere else, but our freinds in Congress (Barney Frank, Chris Dodd, et al.) pointedly dismissed the repeated urgings of the Bush administration to stop the madness of selling homes to people who had no way to repay them. (I’ll add here that the Bush administration made its share of spending and regulatory excesses).
Government regulates everything from the width of our dooorways, to water purity, to the nuances of what is taught in the educational system. Now it’s our own health and soon it will be the air we breathe. It’s too much!
So my point is that the simple mechanics of the free market system have been repeatedly sullied by an overbearing government. It’s not a matter of whether to regulate or not. We need to regulate. The question is, at what point is it too much, and I believewe are way, way past a reasonable point of interference.
So, I am true to my roots here, Peter. I vote for simplicity. And actually, smallness and simplicity IS the root of our success with Centratel. You should come visit Centratel sometime and I’ll show you.
Thanks for the animated back-and-forth.
-sam
System thinking meets democracy…
The issues with government and especially democratic government are systems ones. The disconnection of the voter is a systems one. Most if not all democracies are not real democracy they are actually representative democracies. They are not government by the people. The people are once twice removed from real decisions.
I envisage the creation of representatives came about in early democracy for one practical reason and maybe one protectionist reasons. Firstly for very practical ones it could take days or weeks for the opinion of the common people to reach the seat of decision making power so instead they elected a representative. Secondly representatives may well have been a sop to the elite of nations to ensure the educated and the ‘well to do’ have the positions of authority, in essence government protecting itself?
Now putting the second to one side as pure speculation and an irrelevance if we fix the first I now believe this system of elective representative democracy no longer stands up to real scrutiny. Every week people phone in, vote on online and express opinions on numerous issues regarding ‘reality TV’, online content and polls of any number of formats. The technology now exists to negate the representative system. The technology now exists to allow real time government by the people for the people. The technology now exists to challenge and design a better system. A system where people could vote directly on issues. A system that would encourage people to understand issues because they could influence them. A system where representatives weren’t open to manipulation by special interest groups. A system for the people by the people. A real democracy.
Hi Sam,
Thanks for your reply. I too, am enjoying this exchange.
I believe you’ve misunderstood me, for I am not a fan of big government per se. Smallness or bigness each are niether good nor bad in and of themselves. Small/big, free/regulated, simple/complex etc. – part of this discussion we’re having boils down to semantics. Reminds me of the Clintonian, “that depends on what the mening of ‘is’ is.”
I’m going to take some of your arguments and turn them back on you, not because I think you’re a clueless debator, or a power hungry conversationalist (more on these adjectives later); but because it will help me more cogently express what motivated me to respond here in the first place.
Centratel is obviously on the road to disaster. I have on my desk their Strategic Objectives Document, a succinct and cogent statement that barely exceeds a page in length. Contrast that to their recent ______ Procedure, the pages of which run into the dozens! The contrast is between the entire basis of a fine company (circa 1990 something) vs. one statement of procedure (circa 2010).
Centratel regulates everything from how and when we open envelopes, to when we file a folder, or when we update inventory. The next thing you know it’ll be how many pens we have on our desk and at what times of the day we can sharpen our pencils. It’s too much! If they’d just trust in the simple mechanics of human nature we’d get so much more done.
See where I’m going with this? It’s not as simple as big or small, or regualted or free. But, I’m not trying to say it’s complicated either. I’m saying these concepts are non-issues, or at best incomplete issues.
What motivated me to respond here is my concern about the polarization – and the stagnation and inability to get things done that comes from that – that characterizes the political landscape today. This is certainly not an optimum or efficient way to run a business or a government.
To reduce things to black and white, then equate these with good or bad, and then to ascribe inuendos such as clueless and power hungry to the opposition is not a very “simple” way to get things done (unless of course you’re in the majority). By no stretch of my imagination can I see this as conducive to an “outside and slightly elevated” perspective – something I think is really needed if we are to arrive at effective solutions to our real (and serious) problems. It’s more conducive to an Orwellian “four legs good, two legs bad” out of control anarchy, which, worse than being non-productive, can be downright destructive.
I’m willing to bet the rent Sam, that this is not the prevailing atmosphere at Centratel when procedures are being revised. On the contrary, I’ll bet things are designed to prevent just that sort of atmosphere from standing a chance. Why should it be any different with political discourse and government? Respectfully, I’m having trouble seeing how this is true to your roots.
This kind of atmosphere complicates and obscures real problems and real issues, at everyone’s expense. We vote against Bush’s immigration reform because it’s labelled as amnesty (when it has more in common with a very protracted probation), or shout down financial reform as a bail out (when it has more in common with the FDIC – which enjoys wide acceptance – than TARP). People think less, react more, voting becomes less meaningful, and government ineffective.
Unless we all make a commitment to be more diligent, careful and respectful in our speaking, listening and thinking; I fear we’ll all be voting for non-issues and blaming the “other side” for all our problems while our free government in-name-only is run by some other powers and not by the people it was designed to represent.
*******
Thanks for the invite, I’d love to visit, if not work there (if I’m unsuccesful in establishing something similar in my enterprise before …). I wish our current political landscape looked more like Centratel.
Regards,
Peter
Hi Matthew,
Thanks for bolstering my argument. The mechanism of government you propose would be much smaller than our current form and also far simpler.
I’m not so sure I’d want to live there however. Perhaps my biggest fear is that I could wake up one morning and find the Bill of Rights gone, assuming your system would leave that part of the Constitution intact. And I have other fears, too.
Regards,
Peter
Peter, the fear of what change may be imposed on me by others is a great example of why people maybe created representation in the first place (second point above). Such a system I’m proposing could include allowing anyone to proxy their vote to a party for a period and then over ride it on any issue or switch it at any time.
I’d predict some variability in the government whilst the people learned to steer their own destiny but over time it would settle to people being responsible and accountable.
On the topic of Centratel the issue is that the system exists, is followed and takes all the blame if it fails. The leader’s actions align with this. People in the business know their human nature and creativity can be channelled into changing that system at any time. All they need to do is propose something better. By this Centratel have an open system that can evolve whilst simultaneously controlling inputs, process and predicting outputs.
YOU NAILED IT. I HOPE ALL THE FREE THINKING PEOPLE IN AMERICA READ THIS!
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