Dartblog

I have often been asked why it is that so many businessmen who run small and medium size companies are skeptical about the growth of government’s role in our society. I think that the question is a pretty easy one; the answer breaks down into two parts:

Firstly, business people at this level actually deal with government regulators on a regular basis. Do you? Most people that I speak to, and this is especially true among people on the left, have never dealt directly with a government agency, except perhaps to renew a driver’s licence. Here is list of governmental entities that one of my local businesses has dealt with face-to-face over the course of the last year, often at great length:

• Internal Revenue Service
• Department of Homeland Security
• U.S. Customs Service
• State of NH Department of Revenue Administration
• State of NH Swimming Pool Inspector (I was surprised one existed, too)
• State of NH Attorney General, Consumer Protection and Antitrust Bureau
• State of NH Labor Department
• State of NH Climbing Wall Inspector (I am no longer surprised by anything)
• State of NH Department of Motor Vehicles
• City of Lebanon Tax Assessor
• City of Lebanon Zoning Office
• City of Lebanon Fire Department

I won’t disparage the folks who work in these government offices, except to say that people who work for the government are cautious to a fault and have an inordinate fear of exceeding their authority. The number of meetings required to make a decision shows that they have little consideration for the speed and efficiency required of a business to succeed in a competitive market. For a parallel, think of the administrators that you deal with at Dartmouth College.

Secondly, business managers themselves work hard to stop the natural inclination for growth of their own bureaucracies. Employees in any organization, it seems, almost always believe that they need an assistant or more budget or consultants or extra technical support. If an owner does not keep a firm hand on budgets, then the administrative side of a business will grow faster than the business itself. Sound familiar?

Why do owners work hard to rein in this natural tendency toward bureaucratic growth? Because a business owner has a real incentive to keep costs in line: if costs stay down, profits go up, or at least they stay the same because competitiors are controlling their own costs with equal resolve. However, in a government bureaucracy, or at a place like Dartmouth where rigorous management has been lacking, there is little countervailing pressure to control growth — in fact, managers are rewarded with higher salaries if they add subordinates: more responsibility in management begets greater rewards.

The results are all around you to see in America (and at Dartmouth): bloated budgets, excess numbers of staffers, and poorer services, not better. Any responsbility given to the goverment seems inexorably to follow this path.

Of course, the question remains as to whether there still exists a national political party that actually believes in limited government…