Running Government Like a Business
Conservatives believe having experience in business is a good background for running the government. They often advocate running government like a business. The Republican presidential candidate claims his business experience as his primary qualification for office. Senator Johnson in Wisconsin and Mr. Mills in Minnesota also make this claim. But I would suggest voters should bring a healthy dose of “buyer beware” to the claims that business experience makes good political leaders. Not only is a business background not necessary, or particularly useful, but the individual claims of competency based on being in business may be false advertising.
Is a business background good for governing? Certainly there are skills used in business that are transferable to public service or governing. Being organized, setting goals, monitoring finances, dealing with employees, being innovative, and getting things done on time are experiences that result in success. But these skills can be developed in many other occupations. These skills are used by many successful people in all walks of life.
There are many skills needed in politics that are not developed (or developed very well) in business. Social skills of cooperativeness, creativity, and empathy for others come to mind. Having a broad background with greater understanding of the diversity of people, and people’s situations, would be enormously useful. They must be skilled at compromise and diplomacy. Good political leaders care about people. They inspire people to greater goals than self interest. They have a vision for improving our communities and not just making money.
Many business leaders have these values and could make good political leaders. But many do not. The competitive, profit oriented business culture often promotes winning over the greater good. The money motivated, authoritarian, top-down leadership style of many successful (and many not so successful) business leaders is not what is needed for the building a better society.
When people talk about running government like a business they usually mean making government operations more “efficient” or cost effective. Doing more with less taxes is the goal. This is a good objective and we certainly should keep government costs as low as possible. But it should be obvious that the purpose of government is different than business. Businesses exist to make money. Government exists to organize and regulate a society for the well being of all its members. Do you want a government that is efficient or fair? Do you want a court system, for example, that is efficient or one that is just? Running the courts like an assembly line would be more efficient. Get rid of the lawyers, juries, appeals, and other inefficiencies and you could save money. Dictatorship would be more efficient than the messiness of democracy. But is this really what we want?
We also need to examine the candidates’ business experience claims closely. We need weigh their background against their actions, statements, personal characteristics, and policy objectives. Just because Senator Johnson married into a business or Mr. Mills was born into the family business is not qualification enough. What have they actually done in business? What were the outcomes? Did their actions contribute to positive results for consumers, the economy, and and our society?
In the case of Mr. Trump there is a lot to examine and to question. The press has done a pretty good job examining his business record and the picture is not encouraging. Many articles from reputable liberal and conservative publications point to a troubled business record that voters should examine closely.
Bankruptcy. Although he has not personally gone broke, his business “deals” have gone into Chapter 11 bankruptcy SIX times according to NBC News and Politifact. Business is risky. But Trump’s record is unusual. Trump claims successful businesses file for bankruptcy all the time. CNN Money disagrees and says fewer than 20% of publicly traded companies have gone bankrupt.
What is disturbing is not the failures but his attitude. He has been quoted as saying, “I used the law four times and made a tremendous thing. I’m in business. I did a very good job.” Apparently he thinks bankruptcy is a legitimate business tool to make money.
Reckless use of debt. As widely reported, a major reason for his failures have been too much debt. He piles up debt (sometimes using junk bonds) that can not be supported by the revenue from the venture. Then he bails leaving bondholders, investors, and small contractors to pay the price. He claims the businesses he runs have “very low debt and tremendous cash flow.” Fortune Magazine dismisses Trump’s claims and says, “a close examination of how Trump ran one of America’s biggest gaming enterprises demonstrates an entirely different kind of thinking from the belt-tightening rhetoric he spouts on the campaign trail. In fact, Trump has a record of recklessly piling on debt—with disastrous results.”
Tax Avoidance. USA Today says Trump’s companies have been involved in more than 100 tax disputes. The New York State Department of Finance has obtained liens on Trump properties for unpaid tax bills at least three dozen times.
Product Failures. Trump has lent his name to a number of failed business products and ventures outside of real estate. These include Trump Airlines, Trump Magazine, Trump Vodka, Trump Steaks, Trump Mortgage and Trump University. New York’s attorney general prosecuted Trump U. calling it a “classic bait-and-switch scheme... It was a scam, starting with the fact that it was not a university.”
Failure to pay bills. A USA Today investigation found “hundreds of people – carpenters, dishwashers, painters, even his own lawyers – who say he didn’t pay them for their work.”
Labor and treatment of workers. USA Today says Trump’s companies have also been cited for 24 violations of the Fair Labor Standards Act since 2005 for failing to pay overtime or minimum wage.
Law suits. Trump and his businesses have been involved in about 3,500 legal actions in the past three decades. The suits range from employee and customer complaints to defamation cases to big dollar real estate contract disputes. USA Today says “The sheer volume of lawsuits is unprecedented for a presidential nominee.” If elected he will still be dealing with at least 50 suits while in office. USA today suggests his aggressive use of law suits may be a cautionary clue to his leadership style as commander-in-chief.
“Trump says he wants to run the nation like he’s run his business? God help us.” This quote from Micheal Bloomberg, billionaire businessman and former Republican mayor of New York, say it well. Simply put, Trump’s business record is not indicative of good leadership or other characteristics needed for a good president. There are too many examples of bad business practices, illegal or unethical behavior, failures, misrepresentations, and simple selfishness. If voters do not heed the business principle buyer beware they likely will suffer from another- buyers remorse.