Why Big Business Candidates Usually Become Big Government Politicians


By Liberty Candidate 2011,

Daniel de Gracia

 

 

 

HAWAII, May 31, 2012 — As congressional candidates square off in primaries across America, one of the most frequently invoked justifications for choosing one party personality over another is “business experience.” We’ve all heard the campaign tagline a million times: “So-and-so’s years of experience in business will help turn around our government and put our nation back on track.” But does experience running a company really make a candidate more qualified for office?

Thinking Carefully About Policy and Profits

In the early days of the Republic, America was a sparsely populated, largely agrarian nation. Legislators often served short careers in office and usually introduced inchoate laws – that is, bills they expected to pass on an as-needed basis. Congressional workload was light to moderate, with most legislators using family members as staff and the topics which came before committees were ones which could be resolved with minimal technical experience.

Today, Congress is a vastly different institution from its origins. Immense expertise on a dizzying array of matters is in high demand as Congress insists on legislating increasingly complex matters ranging from domestic economics to international affairs to even advanced scientific research.

The rise of the “2,000-page bill” introductions along with an already confusing myriad of existing laws, regulations, agency traditions and licensing regimes often force legislators to depend on lobbyists and expert staff members to know what needs to be done. Amidst this chaotic environment, it is argued that a candidate with prior business experience will be the best to handle the so-called “gridlock” of Washington and serve America.

The problem, however, with candidates with business backgrounds – especially those with big business experience – is that running a company well is not the same thing as running a government. In a business, profit-seeking is the core of any successful company. While a company that expands its production and increases its profits may be extremely popular among shareholders, a government that increases its tax revenues and upgrades its operations using “business methods” is essentially becoming better at stealing from taxpayers and more efficient at bossing people around.

As the ancient Greek author Thucydides famously warned in History of the Peloponnesian War, “as the power of Hellas grew, and the acquisition of wealth became more an object, the revenues of the states increasing, tyrannies were by their means established almost everywhere.” Said another way: Want government to help you and your friends get rich? Then use government to rig the market!

Consider this: In a total free market absent any government, no taxes exist; therefore, where revenues minus costs equal profits, money made by businesses goes to paying wages (purchase of labor) and investing in more business (purchase of capital).

Since a free market also has no government-controlled central bank to artificially dilate or contract the money supply through interest rates, the amount of money in the market is relatively stable and combined with increasing efficiency of production, the more “free” a market is, the cheaper products get and ultimately, profits fall.

Continued

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