Govt. run as a business (Derail from Santorum thread)

Romantic Heretic said:

Um, the Republicans, as currently constituted, are not conservatives. I have not viewed them as such since Newt was Speaker. They're revolutionaries. Their goal is to destroy the United States and replace it with something where they'll be in power forever.

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Quite a dark perspective on the GOP. You describe them as being the Norsefire Party and the US are just a "Three Waters" and a "St. Mary's" away from them taking over. Although I'm sometimes tempted to believe the same, I don't think it does them justice.

Besides, do you think Democrats can't be equally powerhungry themselves?

raburrell said:

The idea that government can and should be run like a business is seriously flawed, IMO.

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I agree. Government is about people, not profit.

Also there's lots of myths around, saying businesses are better equipped for performing certain tasks than government is. Sometimes they aren't.

raburrell said:

The idea that government can and should be run like a business is seriously flawed, IMO. There are elements of management strategy, efficiency, etc, which can be applied, but the purpose of a government and the purpose of a corporation couldn't possibly be more different.

While I understand that many conservatives would disagree, the ideal purpose of a government is to protect the many from the few and the few from the many. (source of said quote is eluding me. And if it happens to be Lenin or Stalin, it will be par for the course with how my day is going lol). Anyhow, a business's purpose is to make money for its shareholders. I see very little in common there.

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The difference is that a government run "business" is not in it to make a profit(I have no idea why people don't understand this), but rather, its main purpose is to maximize its expenditures as they relate to the money it is given every year. in other words, their aim is to use every penny that they are given for their budget.

j. Adams said:

The difference is that a government run "business" is not in it to make a profit(I have no idea why people don't understand this), but rather, its main purpose is to maximize its expenditures as they relate to the money it is given every year. in other words, their aim is to use every penny that they are given for their budget.

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Furthermore, the primary concern of government is conserving the assets of the nation (people and land). This is in opposition to what a business is about, to serve people and not just those in the nation.

j. Adams said:

The difference is that a government run "business" is not in it to make a profit(I have no idea why people don't understand this), but rather, its main purpose is to maximize its expenditures as they relate to the money it is given every year. in other words, their aim is to use every penny that they are given for their budget.

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I wish the federal government had this problem. And I don't think anyone "doesn't understand" that the government isn't "in it to make a profit."

When I say "run it like a business," I'm not referring to a greedy, money-hoarding, every-man-for-himself, rape-the-land mentality. The fact is that the government should aim for profit -- except that the profit would be used for additional programs that benefit the country. Like a non-profit business, it's still a business.

Xelebes said:

Furthermore, the primary concern of government is conserving the assets of the nation (people and land). This is in opposition to what a business is about, to serve people and not just those in the nation.

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Interesting assessment. It's sounds like you're saying that a typical business is not interested in asset management, or in the conservation of its assets. That would be (and is, where it exists) really stupid business. Intelligently-operated businesses ARE like this--they care about their employees and they cultivate their land/assets/etc and this is because of the profit motive. For the production of future income. They put money back into the company with long-term goals to continue to be in existence and to be profitable. I'm not talking about irresponsible businesses or businesses who run their people and their assets into the ground. That kind of management eventually will fail. Which kind of circles back to my point, that the only reason the federal government hasn't failed is because for years, they've been dipping into funds that should be off limits and borrowing money. Basically, raping the social security system and becoming indebted to other countries.

The fact is that there is so much fiscal waste, and no one seems to be truly motivated to keep expeditures equal to income, let alone reduce the national deficit. Not since I was wee child and Reagan was in office.

I do accounting and taxes for profit and non-profit businesses. A common goal of both of these businesses is to operate within their means and to continue to exist. This is much stronger motivation where there is no temporary "out" in the form of loans, or even, I daresay, in increasing the taxpayers' burden.

raburrell said:

If you read my comment, I said there are useful elements in terms of efficiency, etc, but setting business strategy for a corporation (especially one like Bane) and setting policy for a nation are entirely different animals.

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One of the main problems with our idea of 'efficiency' is that we conflate it also to mean 'effective' and 'good.'

As the problems with health care in the States demonstrated the insurance companies were very efficient at making money but not very effective at delivering health care.

As far as efficiency being good goes, at the risk of Godwinning this thread, the Holocaust was very efficient.

raburrell said:

Make a profit on what? Sorry, I don't get this.

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Definition of profit: excess of revenue over expenses. That is all. No mystery. And obviously, no shareholders.

Romantic Heretic said:

One of the main problems with our idea of 'efficiency' is that we conflate it also to mean 'effective' and 'good.'

As the problems with health care in the States demonstrated the insurance companies were very efficient at making money but not very effective at delivering health care.

As far as efficiency being good goes, at the risk of Godwinning this thread, the Holocaust was very efficient.

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I agree with your sentiment. Conversely, I'll say that "profit motive" does not equal "evil motive."

IMO, your point brings up a rather separate discussion of integrity (delivering what you promise to deliver). But since we all know that politicians are exempt from such matters, why go there?

raburrell said:

Okay. Although I was asking more for clarification on what they were making a profit from and on than the definition of profit. But I still stand by the other half. Nothing wrong with the same government occasionally running a deficit.

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Yes, I also agree that occasionally isn't necessarily a bad thing, in an emergency situation. I dunno though, 15 trillion, with no end in sight? And we bailed out WHO?

Anyway. 'Nuff from me. I've got a tiny little business to run. Cheers!

The purpose of business is to serve assets (wares, inventory) to customers. Businesses have capital, just like governments, but that's not how they ensure they survive. If a business has too much capital assets to serve its wares and inventories, it is not going to end up well because the expenses are going to be too much. The government does not have that problem - capital assets belong to the government any which way unless it decides to sell them off.

Chrissy said:

Definition of profit: excess of revenue over expenses. That is all. No mystery. And obviously, no shareholders.

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It seems to me like you've never actually worked for a government organization, because if you had, you would be laughing at your own commentary.

Government run monopolies don't work that way. If they are given a budget consistent of X dollars, and for some reason they make a profit of Y dollars on that budget, the next year they will receive a budget of X-Y dollars from the government. That's one of the main reasons why a government run monopoly seeks to maximize expenditures and not profits. i.e. They just don't want to get less money the next year.

Having said that, state sponsored social programs, while they may never be "fixed" to run with perfect efficiency, maybe they simply don't need to. Maybe they just need to continue running at a level that serves the community in a way that makes most people feel like they are getting a fair return for their tax dollar, with an eye towards always improving the system.

If a "businessman" gets a hold of these programs, he will run it in a way that does not serve the community, but rather the almighty bottom line, and that can have negative social consequences. i.e. Public Finance is not the same as Corporate Finance.

j. Adams said:

It seems to me like you've never actually worked for a government organization, because if you had, you would be laughing at your own commentary.

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Not sure why the GAAP definition of profit is funny. But of course, you're entitled to laugh.

Government run monopolies don't work that way. If they are given a budget consistent of X dollars, and for some reason they make a profit of Y dollars on that budget, the next year they will receive a budget of X-Y dollars from the government. That's one of the main reasons why a government run monopoly seeks to maximize expenditures and not profits. i.e. They just don't want to get less money the next year.

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You have just made my point. (Now I'm supressing laughter ) That is one of the most ridiculous, waste-inducing justifications for spending money that I have ever heard of. We need to change this. I.E., run it like a business. So you don't lose your funding just because you didn't spend it by the end of the fiscal year.

Having said that, state sponsored social programs, while they may never be "fixed" to run with perfect efficiency, maybe they simply don't need to. Maybe they just need to continue running at a level that serves the community in a way that makes most people feel like they are getting a fair return for their tax dollar, with an eye towards always improving the system.

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To me, this is a contradiction, and sounds suspiciously like the typical government attitude. "Aw shucks, it's not that bad." And what is this nebulous incentive for improvement? Government is typically thirty years behind non-government businesses when it comes to innovation and technology.

If a "businessman" gets a hold of these programs, he will run it in a way that does not serve the community, but rather the almighty bottom line, and that can have negative social consequences. i.e. Public Finance is not the same as Corporate Finance.

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I completely disagree. This theory assumes certain prejudices about "businessmen" (to use your quotes) -- it seems you feel they are not capable of helping anyone but themselves. Simply not true. It's not an either/or situation.

j. Adams said:

I
If a "businessman" gets a hold of these programs, he will run it in a way that does not serve the community, but rather the almighty bottom line, and that can have negative social consequences. i.e. Public Finance is not the same as Corporate Finance.

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This assumes that the person with business experience is entirely ignorant of the objective of government, and malevolent to boot.

Businesses exist to serve customers with goods or services. If a business does not satisfy customers in a cost effective way, their either lose the customer or close up shop. Government isn't too much different - they provide services to the people.

I'm not saying that government is 100% broken, or that businesses are 100% efficient. But why can't some measure of efficiency, cost accountability, streamlining, and customer service become part of how government operates?

One example: How many agencies at the local, state and federal level do the exact same thing? How much money goes into ensuring they are coordinated? How many missteps or levels of approval are there to accomplish anything? That goes for everything from law enforcement to agriculture to education to tax collection.

And sometimes (most times if you only read the P&CE) government oversteps, or doesn't go far enough to protect the rights, safety, property, or lives of citizens. It's not enough that they try to provide a service - if they are designed to do it, they should do it near flawlessly.

I'd like government to look more like a benevolent corporation where the people come first, than whatever it is today...

Chrissy said:

Not sure why the GAAP definition of profit is funny. But of course, you're entitled to laugh.



You have just made my point. (Now I'm supressing laughter ) That is one of the most ridiculous, waste-inducing justifications for spending money that I have ever heard of. We need to change this. I.E., run it like a business. So you don't lose your funding just because you didn't spend it by the end of the fiscal year.



To me, this is a contradiction, and sounds suspiciously like the typical government attitude. "Aw shucks, it's not that bad." And what is this nebulous incentive for improvement? Government is typically thirty years behind non-government businesses when it comes to innovation and technology.



I completely disagree. This theory assumes certain prejudices about "businessmen" (to use your quotes) -- it seems you feel they are not capable of helping anyone but themselves. Simply not true. It's not an either/or situation.

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Yes, I suppose all the people that specialize in Public Finance that have been doing this for decades have it completely wrong.

Do you realize how absurd you sound right now?

You're trying to equate a corporate business to a government run monopoly, and that's where you
fall flat on your face. It's not the same thing. In fact,
its not even close.

The purpose of social programs is to benefit the community as a whole, not just the bottom line. You seem to think that running these programs with the mind of making a profit will make things WAY better. I find that laughable tbh. The reality of the Economics in question is completely against you.

See, when you run a business for profit and (say healthcare), and you have a patient that is costing
you a lot of money, you would probably let him go, in order to improve efficiency. Conversely, in a government run healthcare institution (Medicare and Medicaid), it would be irrelevant how much money that person was eating up, as you would help them regardless no matter what the cost was.

That's the difference that you don't seem to want to understand.

MattW said:

This assumes that the person with business experience is entirely ignorant of the objective of government, and malevolent to boot.

Businesses exist to serve customers with goods or services. If a business does not satisfy customers in a cost effective way, their either lose the customer or close up shop. Government isn't too much different - they provide services to the people.

I'm not saying that government is 100% broken, or that businesses are 100% efficient. But why can't some measure of efficiency, cost accountability, streamlining, and customer service become part of how government operates?

One example: How many agencies at the local, state and federal level do the exact same thing? How much money goes into ensuring they are coordinated? How many missteps or levels of approval are there to accomplish anything? That goes for everything from law enforcement to agriculture to education to tax collection.

And sometimes (most times if you only read the P&CE) government oversteps, or doesn't go far enough to protect the rights, safety, property, or lives of citizens. It's not enough that they try to provide a service - if they are designed to do it, they should do it near flawlessly.

I'd like government to look more like a benevolent corporation where the people come first, than whatever it is today...

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They already do all that. The problem here is that the nation is getting older, and as such the costs for Medicaid, and Medicare are ballooning. That isn't the fault of the government, that is just the reality we face today.

And like I told Chrissy, a business can turn a customer away, the government however can't. It's reason for existing is to serve the needs of its populace. The business' reason for existing is to maximize its profits in order to ensure a good return for its shareholders.
Those are almost diametrically opposed POV's.

Also, as I stated before, Romney is a corporate finance guy. He has no inkling how to run public institutions that operate at a federal level.

j. Adams said:

Yes, I suppose all the people that specialize in Public Finance that have been doing this for decades have it completely wrong.

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Yes, that is exactly what I am saying. The government sector has a "specialized" view of fiscal responsibility that is wasteful, and therefore, IMO, detrimental to the taxpayers that it serves.

Do you realize how absurd you sound right now?

You're trying to equate a corporate business to a government run monopoly, and that's where you
fall flat on your face. It's not the same thing. In fact,
its not even close.

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Interesting word choices. We can be respectful, can't we? I enjoy the dialogue, and I know you can make your points without the dramatic extras.

To answer the above, I agree that it's not the same thing. I'm saying it should be. Just using your own definition of the federal government as a monopoly: Monopolies aren't even legal in most cases. Why? Because there's an inherent belief that monopolies are too powerful and lead to abuse of that power.

The purpose of social programs is to benefit the community as a whole, not just the bottom line. You seem to think that running these programs with the mind of making a profit will make things WAY better. I find that laughable tbh. The reality of the Economics in question is completely against you.

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I've already responded to the social benefit versus bottom line concept. You've exaggerated my position as far as "profit" is concerned. In a previous post, I mentioned that non-profits run their businesses in the same way that profit businesses do. Income in, expenses out. The End.

I'd really like you to expand on the bolded statement. You're not providing any basis for it.

See, when you run a business for profit and (say healthcare), and you have a patient that is costing
you a lot of money, you would probably let him go, in order to improve efficiency. Conversely, in a government run healthcare institution (Medicare and Medicaid), it would be irrelevant how much money that person was eating up, as you would help them regardless no matter what the cost was.

That's the difference that you don't seem to want to understand.

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And again, you're exaggerating. My point was not that we should look at people's needs like a cost/benefit analysis. Maybe that's what you think I'm suggesting--that any program that isn't somehow "profitable" should be shut down? Never said anything of the sort. There is obviously benefit in helping people. This is why nonprofits spend money, while all the while they still have to be accountable for their expenditures and they don't have a bottomless well of foreign credit, nor are they allowed to shift funds earmarked for other programs to do social experiments that may or may not (and usually don't) work in practice.

What you don't seem to understand at all is how much money is being wasted due to the giant, bureaucratic slug that the federal government has become.

MOD Note:

I'm thinking we can have this discussion without the personal digs.

Let's proceed with a bit more forethought, thanks.

In private business, there is this thing that's called COMPETITION When there are lots of companies vying for your dollar, they compete against each other, and the end result is usually a lower price for you, as well as a more efficiently run industry. The companies that can't adapt and change either go bankrupt or leave. If a company is inefficient and is running at a cost higher than the others in the industry, they will eventually go bankrupt. So either they adapt or they leave.

Government run monopolies (i.e. social programs) have no competition. There are no competitors to drive these programs to become more efficient, or more importantly to help drive down costs.

That's the name of the game here. Competition.

If you think that Romney is going to magically clean up the government and make it run more efficiently, then IMHO you're off to LA La Land. It will never happen. You can't just magically make a business run more efficiently if you don't actually have competition. It just doesn't work that way.

Williebee said:

MOD Note:

I'm thinking we can have this discussion without the personal digs.

Let's proceed with a bit more forethought, thanks.

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Oops, I didn't see this post. My bad. I'll edit my last one

Chrissy said:

Yes, that is exactly what I am saying. The government sector has a "specialized" view of fiscal responsibility that is wasteful, and therefore, IMO, detrimental to the taxpayers that it serves.



Interesting word choices. We can be respectful, can't we? I enjoy the dialogue, and I know you can make your points without the dramatic extras.

To answer the above, I agree that it's not the same thing. I'm saying it should be. Just using your own definition of the federal government as a monopoly: Monopolies aren't even legal in most cases. Why? Because there's an inherent belief that monopolies are too powerful and lead to abuse of that power.




I've already responded to the social benefit versus bottom line concept. You've exaggerated my position as far as "profit" is concerned. In a previous post, I mentioned that non-profits run their businesses in the same way that profit businesses do. Income in, expenses out. The End.

I'd really like you to expand on the bolded statement. You're not providing any basis for it.




And again, you're exaggerating. My point was not that we should look at people's needs like a cost/benefit analysis. Maybe that's what you think I'm suggesting--that any program that isn't somehow "profitable" should be shut down? Never said anything of the sort. There is obviously benefit in helping people. This is why nonprofits spend money, while all the while they still have to be accountable for their expenditures and they don't have a bottomless well of foreign credit, nor are they allowed to shift funds earmarked for other programs to do social experiments that may or may not (and usually don't) work in practice.

What you don't seem to understand at all is how much money is being wasted due to the giant, bureaucratic slug that the federal government has become.

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Feel free to point your finger at an actual part of the Govt. Too often I see people saying what you stated and not having a clue as to where the "waste" is.

j. adams, you're being really rude.

thebloodfiend said:

j. adams, you're being really rude.

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*shrug* It happens when people say things that are utterly wrong.