Like nobody’s business

To the greatest extent possible, government should stick to doing those things private businesses can’t or won’t do.

This rule gets broken all the time, almost always with less than favorable results.

Take Wisconsin’s approach to promoting job creation, for example. The state’s economic development agency has been a complete failure. No wonder. What you have in the Wisconsin Economic Development Corporation is a bunch of state bureaucrats pretending to be investment bankers. Wannabe entrepreneurs who’ve sought private financing and had their projects turned down by investment banks, venture capitalists and angel investors are able to make a few well-placed political donations, get some strings pulled, and get financing from the WEDC courtesy of state taxpayers.

Here we have the public sector acting as the investor of last resort for enterprises that private sector financiers won’t touch. That’s not only proven to be a waste of taxpayer money, but a prime example of government getting involved where it does not belong.

Politicians are fond of saying government should be run like a business. The WEDC is proof of the folly in that philosophy. Business and government are totally different creatures, and they have separate purposes.

Successful private businesses have to be able to turn a profit. But not everything that is profitable has social value or promotes the common good. And not everything that is socially valuable or advances the public interest is profitable. Pornography is undeniably profitable and thrives in the private sector, but has questionable social value and is often associated with social ills. Likewise, it is hard to see how gambling makes us better people or strengthens our society but it is a lucrative business. The same can generally be said for sports, fashion and most television programming.

On the other hand, it can’t be plausibly disputed that such things as schools, libraries, parks, police and fire departments, sanitation crews, and military forces are valuable or even indispensable to our society, but none of them would exist if they had to be profitable.

Here is another place where Wisconsin has strayed from common sense. Educating all of our children, regardless of need or disability, is not profitable. The private sector can’t do it. The only sure way to run a school and turn a profit is to cherry-pick students who are easiest to teach and steer clear of those whose needs make them considerably more costly to educate. Wisconsin has chosen to favor schools that are not required to take all comers, rapidly expanding its private school voucher program and sharply increasing funding for voucher schools while cutting state aid for public schools that are mandated to accommodate all students no matter how expensive they are to serve.

Business and government are different creatures that serve separate purposes. Government cannot be run like a business because the public sector’s role in our society is so fundamentally different than the private sector’s. And businesses surely should not be expected to operate like the government. The private sector has its place, and its rules. So does the public sector.

To each its own.

Mike McCabe