Businessmen as Politicians

Getting close to the midterm elections, with all the political adds on TV in recent weeks, I’ve noticed that many aspirants cite their experience as operators of small businesses as a qualification for politics. Even Barney Franks in one of his adds mentions that his family owned a small business which he took charge of for a short while after his father died. I started to wonder if indeed the experience gained as a businessman (I use man in this case to include woman) truly is relevant to public service and have concluded that not only is it not relevant, it may in fact be detrimental to a position representing a population.

As I pointed out in a previous posting on Free Market Capitalism, the system works (and I do believe it does) because in the quest for self interest, coincidentally the society as a whole benefits. The success of a business is measured by the degree self interest is maximized not by how well society is served. In the stock markets, the price of a companies stock increases whenever there is an announcement of impending labor cuts because lower labor means lower costs and lower costs mean greater profits. So when an aspiring politician claims that they were successful businessmen, they in essence are saying they figured out how to bring greatest benefit to themselves. (Though I consider non-owner operators of businesses as administrators, in the common parlance businessmen is also applied to them so in this discussion that’s fine and we can think of their goal as bringing the greatest value to the owners.)

At the ground level the businessman, if successful, has figured out how to get the most for the least out of all of their associations. The highest price from their customers, the lowest price from their suppliers, the lowest rent, the cheapest labor. There is nothing wrong with this because that is how the system works. The output of the endeavor is singular, very focused and clear. It is profit, and there is only one beneficiary to be concerned with, either themselves or their employer in the case of outside owners. In public office, on the other hand there is the need to balance and maximize the benefits to a very diverse constituency with varied interests. A thing we often forget is that the role of a politician is to represent the entire population within their realm of responsibility, those who voted for them and agree with their ideology and those who didn’t. They should to be sensitive to the needs of business to maintain profits, of labor to have jobs and make a reasonable living, of the disenfranchised, the old and the sick, the needs to educate the young, protect lives and property and do this all within the guidelines set by the Constitution and prevailing local laws.

The businessman, on the one hand, has a singular goal and needs to understand the exterior forces in play as they move toward one goal while the politician needs to not only understand the exterior forces but also all the nuanced need of their diverse constituencies. Whereas there is only the need to balance the application of resources for businessman, there is the additional need to balance the benefits to the entire community. Unfortunately most politicians don’t do this well, if at all. They take the easy route and focus on one constituency, be it business, a minority, labor, women, the downtrodden, etc. The job of balancing all the varied needs is difficult and requires a great amount of skill and I feel the business experience with its singular focus is antithetical to the balance required at the output end. Having only focused on profit with no need to ever balance the output they have no experience and there is no indication that success with one is indicative of a skill set required in the other. In fact I believe the skills may in fact be totally different.