When Men Who Have Never Done Anything Run the Show

 

I would have given this excellent, common-sense article by Warren Meyer a different headline. It’s called “Why Keynes Was Wrong,” but I think the real point, the interesting point, is the importance of economic policy being formed, or at least informed, by people who have actually had experience of running a business. I remember talking to Sir John Hoskyns, who headed the Prime Minister’s Policy Unit in Thatcher’s first term, about just this. “Something critical about the Thatcher revolution,” he said, was

the introduction into government, for the first time, of people who have an idea of what happens inside a business. Britain is, compared to the United States, extraordinary because there had been, until Thatcher, such a limited number of people with any exposure to the business world in government.

He himself had founded and run his own information technology company. Recalling the early battles in Thatcher’s cabinet over economic policy, Hoskyns–who was savagely dry on economic policy–complained that

none had business experience, and … some of them were very good, a few like Nigel Lawson, Nick Ridley–I knew Nigel better than I knew Nick, I didn’t know Nick well–but there were various people like that, who really understood the importance of the environment in which business functioned. What they didn’t have–and it isn’t necessarily all that important–they didn’t know what it was actually like, being in business, just how difficult it is, just how well things have to run, the methodology, the systems, the mindsets, the way people think, the way people communicate, the need to have groups who understand the big picture so they don’t have to end their sentences and they can cover the ground fast, and respond to threats quickly, all that. It’s all highly skilled, at its best, and very difficult, and very good people are needed to do it. I think politicians as a whole never quite grasped that. They would be shocked to think that anything was remotely difficult compared to what they were doing. And politics is in many ways, because of its unpredictability and its range, probably as impossible as anything.

As I was looking through my notes from our conversation to find that quote, I happened upon these remarks, which now look quite prescient:

I think that some of the economically literate politicians do have a reasonable understanding of the importance of this, some of them of course don’t–you do get a tendency to think, “Business is a sort of unskilled labor for people who aren’t as clever as I am, you know, I got a First in PPE and therefore I’m naturally going to be in the Cabinet, and I’m going to be running the world, even though I’ve never done anything.” I mean, David Cameron is a classic example of this. He may be–-far too early to form any views, good or bad about him, but, you know.

It’s not too early anymore, and I do think he put his finger exactly on what we’re seeing in Cameron: the mark of a man who’s never done anything. And needless to say, neither has Obama. Among other lessons to take away from this presidency is that yes, experience counts.

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  1. Profile Photo Editor
    @Claire
    Jimmie Bise Jr: I don’t think our public servants need to have run a business, necessarily, but they do need to have spent time in a business, working from the bottom rung to some management position (even if its assistant manager of a McDonald’s). · Jul 30 at 4:58pm

    Yes, Jimmie, you’re right, I probably phrased that too strongly: I don’t think you need to have been a CEO of a Fortune 500 company to understand the realities of business life. (Although that’s an exceptionally strong qualification). But absolutely, you need to have spent enough time in a profit-making enterprise to deeply get what it means when, say, you have to fill in a separate 1099k for every purchase over $600–what that costs in man-hours and lost productivity, and how obstacles like these can cumulatively run a business into the ground.

    • #1
  2. Profile Photo Editor
    @Claire
    G.A. Dean: Some years back I heard Jackie Speier, now congresswoman for CA 12th, describe a time when she was between elected office, and took an executive position at a Silicon Valley tech firm. She was stunned by the speed of actions and decisions, and by how different parties, even different companies, could get together with a “let’s make this happen” attitude and do just that.

    “No one in government understands this,” she said. · Jul 30 at 4:58pm

    It’s not just private-enterprise versus public-sector (though that’s a huge component). It’s also culture. People in Silicon Valley are efficient and action-oriented. Everyone in Turkey, I suspect, whether in the private or public sector, would be awestruck by what Jackie Speier observed if they spent a few weeks in a Silicon Valley tech firm. Nothing, but nothing here happens without hundreds of long, in-person meetings, the drinking of thousands of cups of tea, endless pointless discussions. In the end the impulse to destroy everyone else to make sure no one get aheads tends to trump the urge to cooperate for everyone’s benefit.

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  3. Profile Photo Member
    @

    I don’t think our public servants need to have run a business, necessarily, but they do need to have spent time in a business, working from the bottom rung to some management position (even if its assistant manager of a McDonald’s). The experience gained from working for a paycheck, doing your job well enough to get noticed by your supervisors, putting in the extra effort to earn the promotion, then supervising someone else is invaluable, I think.

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  4. Profile Photo Inactive
    @GADean

    Some years back I heard Jackie Speier, now congresswoman for CA 12th, describe a time when she was between elected office, and took an executive position at a Silicon Valley tech firm. She was stunned by the speed of actions and decisions, and by how different parties, even different companies, could get together with a “let’s make this happen” attitude and do just that.

    “No one in government understands this,” she said.

    • #4
  5. Profile Photo Member
    @JimmyCarter

    How about experience just balancing a checkbook? Anyone…. Anyone?

    • #5
  6. Profile Photo Member
    @ScottR

    As a (very) small business man, I just found out that, starting in a year and due to Obamacare, I’ll have to file a separate form, a “1099k,” for every purchase of over $600 from another business–Officemax, each separate Home Depot or Loews, my accountant, truck repairs, whatever. For me, that’ll be 20 forms or so per year, and I’ll need to call for the fed ID# of each of those businesses (which will represent a heck of a lot of time on hold, I’m sure). A day, maybe two, of filling out forms and making calls: lost production or lost time with my family (probably the latter). Harassment, pure and simple.

    • #6
  7. Profile Photo Member
    @DuaneOyen

    Beyond the forms, one reason I am sympathetic to the issues of health care more than many on the Right were, is that I was the operations guy (first employee) for a small medical devices start-up in the mid-’90’s. I could only do that after my kids had gotten into college and we could handle some risk; my wife could pick up the health coverage at her job. We went 2 years on investor capital (including mine), then spent the next 2 in the always-raising-money mode.

    After a bit, we had a couple of employees, and I had to find a way to buy health insurance for them. I saw first-hand the damage that state law and government action has done to destroy the market; there was exactly one company that would even write a high deductible policy in Minnesota for a medical savings account.

    That has forever informed my view of both government mandates and health care. No administration should staff up without having “former” entrepreneurs at high levels. Now that I work in academia, I also say that no administration should staff up with large numbers of academics.

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  8. Profile Photo Inactive
    @Palaeologus
    Scott Reusser: As a (very) small business man, I just found out that, starting in a year and due to Obamacare, I’ll have to file a separate form, a “1099k,” for every purchase of over $600 from another business–Officemax, each separate Home Depot or Loews, my accountant, truck repairs, whatever. For me, that’ll be 20 forms or so per year, and I’ll need to call for the fed ID# of each of those businesses (which will represent a heck of a lot of time on hold, I’m sure). A day, maybe two, of filling out forms and making calls: lost production or lost time with my family (probably the latter). Harassment, pure and simple. · Jul 30 at 6:53pm

    That’s exactly right Scott. I have a small retail business that purchases from a few hundred vendors. Will this nonsense actually hurt my business? No. It will, however, waste more of my time than my big-box comp.

    This one-size-fits-all regulatory approach is dismayingly consistent. For all the pro little guy rhetoric the administration spews, it’s much easier to regulate the behavior of 10 huge businesses than 1,000 small ones.

    • #8

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