Government vs. Private

OK, this one is short and simple it is all about purpose and motivation.  The basic purpose of government

has become to limit.  Where as the basic purpose of the private sector is to enable.  Government functions

to keep bad things from happening by providing the least common denominator as a blanket.  By design it

is a one size fits all entity and in so being it becomes clumsy and slow.  The private sector is individualistic

and specific.  Each individual piece can only do what it is designed for but since it is customized it can do

that piece better then any other.

Now as for motivation the government being slow and overarching has to look to the long run and in the

long run or the grand scheme time losses it relevance as does success.  Time and success get replace

with longevity and endurance.  In order to secure these things there is a shift from risk analysis to risk

avoidance.  Instead of weighting the odds of rewards vs. risk the mindset becomes what percentage of risk

is there and the cost goes out the window.  In short they focus on percentage of risk as a measure rather

then a comparison of cost and benefit.  In this mindset there is no motivator to take a risk; any risk would

jeopardize the goal of longevity.  As for the private sector, everything is about risk.  Longevity is useless

for the private sector because the point of the enterprise is to change the current state from have not to

have while the point of government is to keep things as they are.  In the private sector continued status

quo equals loss.  In order to win the private sector has to change.  Change always equals risk so to

survive the private sector is constantly looking to change.  Success in the private sector is based on the

ability to see the change coming and weight the various choices based on their potential risk verses

benefit.  The bigger the possible benefit the bigger the risk.  This is the dilemma for the private sector.

Faced with eventual failure, or the possibility of success, a success that can be extreme, there is an

increased motivation to try.  If you are in a situation where, if you do nothing you will certainly fail, but if you

try you have a chance of success.  The draw is to try.  A chance of success no matter how slight is better

then no chance at all.    

As a example let’s take a look at the Katrina situation and the government’s response.  Even with days

advance notice the government was slow to recognize the possible dangers and upon occurrence the

government was slow to act at best, and incapable to act at all in most situations.  For the government it

was all cost.  Even before the storm hit and the levees broke there was finger pointing; a “whose fault is it”

mindset, which paralyzed the government from action.  If you force everyone out and nothing happens you

will be punished, if something bad happened you will not be rewarded for good initiative and judgment but

punished for how you could have done it better or that it was not necessary.  You don’t go down and take

charge personally, finding out what the situation requires and take action.  In doing so you would have

bucked the system and been grandstanding for political purposes.  Instead you wait.  You look busy and

wait for it to unfold.  You do what you can as long as it does not break a law, a policy, or a precedent.  You

by nature of design can not effectively respond to the situation.

Now as for the private sector it is not a matter of responding to the situation.  It is a matter of taking

advantage of the opportunity.  In a cold mindset.  If there are fifty thousand hungry, thirsty, dirty, tired

people in a single location like the Superdome then that is an incredible opportunity.  You get a truck and

fill it up with water, food, blankets, and whatever else you think might be needed and you drive it down to

the stadium and sell it at twice the price you paid for it.  In the end, it might be said that you took

advantage of the situation but you made a great profit and now with your profit you can afford to give away

a few bottles of water and a bag of chips to the elderly and the kids on your next trip down.  Which of

course you are going to keep doing until it is no longer cost effective.  By the time you decide to stop

making the trip the government might have been able to send someone down to the stadium to see if there

was a problem.  I would admit that I would feel for the people in an unfortunate and tragic situation but you

have to ask yourself how the people are best served.  On the one hand, they get nothing and it coast them

nothing possibly as they are starving, dying of thrust and sickness; lingering in their misery until the

government is able to act.  On the other hand, they get some if not all of there basic needs meet at an

increased price; saving many, if not all, from possible death but they are left feeling upset that they have

been taken advantage of.  I think alive and pissed off is better then passive unto death.  For a government

a pissed off populous is a bad thing; for the private sector it is again on opportunity.

The Point:

Greed is the greatest motivator known to man.  Outside of a few ignoble and extreme situations.  Self

interest is what drives all life.  In humans it eventually works itself out to the profit motive.  How can I get

more, get as much as I can.  It’s not a bad mindset in itself only in its potential application.  Individual drive

and thought to get ahead provides for the fullest and most efficient exploration of any solution to any

problem.  The one who get there or figures it out first is the one who makes the money.

Government is by its very structure incapable to act and or react as quickly and decisively as individuals.  

It all has to do with the purpose of government to look to the common good (see consensus) and consider

the bigger long term situation.  Most governments are by design limited for fear of the tremendous power

they could potentially and most likely abuse.  Because of these two factors and the resulting bureaucratic

culture of government they are slow and unwieldy and can not respond to situations as well as private

organizations and individuals within a free market.  

The Lesson to Learn:

You can look to governments for stability and control in many situations and in a general sense but

governments are made up of people and usually people who couldn’t make it in the free market or people

who did make it but having gotten the money; they wanted power.  Outside of providing a general

framework for a society to function governments are a poor substitute for a free market and private

business.  The more singly controlled a government becomes the more nimble it will be but the less

freedom it will enable and in the end the less successful it’s economy and people will be.   

The Brutal Truth:

A healthy fear of government is a good thing and the motivation to pursue free market solutions to

problems is even better.