Sunday, June 6, 2010

The Abject Failure Of The Business Model Of Governance

It is the norm these days for public policy issues to be decided on a purely cost/benefit basis. Would the policy be efficient? Would there be monetary savings? What would it cost? Is the benefit “worth it?” Governments have moved away from acting on big issues in the way that most benefits their constituents. Now it's all about the money.

A related phenomenon has been the rise of the CEO politician. The model for this was George W. Bush, Harvard MBA and “experienced businessman.” Never mind that he was consistently a miserable failure in business. He knew how to run things! He knew how to get things done! He was the “Decider!” We saw how that worked out.

Now we have Cara Carleton S. “Carly” Fiorina raising the bar on this nonsense. While “W” was a small time failure, more of a Keystone Cops kind of failure, Ms. Fiorina's failure was written large: she ruined a hugely successful, hugely big company, H.P. She did, however, get rich doing it, as is our custom, so now she has a large budget for mischief. Like running for the United States Senate in the State of California.

Her claims to entitlement are entirely based on her business experience, with no reference to any desire for societal progress, understanding Political Science or History, wanting to help the middle-class (or, God forbid, the poor, whom no one even wants to talk about), avoiding the devastating mistakes of the past, or achieving a more just society. She's all about the efficiency.

Please believe me, there is a place for efficiency. If you are running a company, or if you are the head of a household, efficiency is very important. Especially in the company; inefficiency was the reason H.P. got rid of Carly. Running a country, though, the overriding goal should be doing what is good for the country. (Thanks for the health care, Mr. Obama!)

One instance of something that a government must do to work for the public good is restrain corporations from being too efficient. Like B.P., whose corporate policy has been to maximize profits at the expense of safety by the avoidance of regulation and the willful disregard of legal oversight.

From Frank Rich's June 4th, 2010 column in the New York Times:

<<“This [government officials being gentle with B.P.] is baffling, and then some, given BP’s atrocious record prior to this catastrophe. In the last three years, according to the Center for Public Integrity, BP accounted for “97 percent of all flagrant violations found in the refining industry by government safety inspectors” — including 760 citations for “egregious, willful” violations (compared with only eight at the two oil companies that tied for second place). Hayward’s predecessor at BP, ousted in a sex-and-blackmail scandal in 2007, had placed cost-cutting (and ever more obscene profits) over safety, culminating in the BP Texas City refinery explosion that killed 15 and injured 170 in 2005. Last October The Times uncovered documents revealing that BP had still failed to address hundreds of safety hazards at that refinery in the four years after the explosion, prompting the largest fine in the history of the Occupational Safety and Health Administration. (The fine, $87 million, was no doubt regarded as petty cash by a company whose profit reached nearly $17 billion last year.)”>>

Wow, seventeen-billion-dollars in one calendar year, now that's efficiency! But is it the kind of philosophy that we want to guide our country with?

We would do better to reject this crop of businessmen would-be politicians, and try to find some statesmen instead (for the job of statesman, after all, it makes some sense). We should also reject the monetarist approach to solving statesmanlike problems. America is a country, damn it, run it like one!


Anonymous said...

Man, that boat has sailed. We'll never see statesmen elected again. It's whoever spends the most bucks wins.


fred c said...

I know that I am a Pollyanna, but I think Pres. Obama has some statesman in him. Let's see how far it gets him though. The opposition has a lot of bucks to throw at their "Obama Problem."

nanute said...

It's whoever spends the most bucks wins. Right you are Ed. The most recent Supreme Court ruling in the Citizens United case seals the deal for corporate "citizens" to outspend the living, human type citizens. In fact, yesterday the Court intervened in Arizona's public financing of elections and has temporarily halted public financing in the middle of an election to consider the case.

fred c said...

I see that Carly and that e-bay person won their primaries in my state of official residence. I can think of no civilized comment at this time.

Anonymous said...

Yep, Carley and Meg bought their way into California. In Meg Whitman's case, she spent over $81 million of her own money.
Gov. Moonbeam won't shine again after all these years, and besides he's too cheap.


nanute said...

The only positive outcome in the California primaries is that Orly Taitz lost her bid for Sec. of State.

fred c said...

If I had the money, I'd pay $81 million NOT to be the governor of California. I would bet that, given the choice, Arnold would pay $81 million NEVER TO HAVE BEEN the governor of California.