The beau ideal of government, embraced by reformers on the left and right alike, is of a government that is responsive, nimble, and accessible.
Conservative reformers often point to successful companies as examples of how government should act.
Indeed, many candidates for office present their business credentials as proof of their ability to run government.
Two GOP presidential contenders tout their experience in business as primary qualifications for the presidency.
But recent examples in the world of business counteract the argument that all government needs to do is to run more like a business. The recent Netflix pricing fiasco is one such instance.
Netflix, a movie-by-mail company attempting to transition to a primarily streaming-video company, first announced a large price hike, then announced that it was splitting its service into a streaming component and a DVD-by-mail service called Qwikster.
The move smacked of haste, and consumers saw through it. Over 800,000 people have dropped the service, and Netflix’s stock price has dropped from $300 per share to under $80.
In short, Netflix’s mistake was so large, it almost seems like something government would do.
What’s fascinating is how the response to the Netflix/Qwikster debacle mirrored common responses to government. The immediate reaction was cynicism — a reaction that shares much with popular response to government failings. Netflix’s best attempts to explain the reasoning were mocked and derided.
Another common reaction was an angry desire to opt-out. In the business context, the opt-out reflex has an outlet, as Netflix’s 800,000 lost customers illustrate. In government, there’s no such easy response.
The Occupy Wall Street and the Tea Party movements can protest all they want, they can desire a different system, they can want to drop out of the system we have, but no such option exists with government.
Bank of America had a similar P.R. nightmare when it announced a $5 charge to use debit cards. Tuesday, it announced that the charge would not be continued, citing the loud protests from its customers.
The American trust deficit — perhaps more correctly framed as a competence deficit — goes beyond government.
Business principles can perhaps streamline government — and despite Netflix and Bank of America’s failings, there are still some companies that model responsiveness — but businesses mess up too, and business principles are no panacea for government.
The key is this: the market holds businesses that fail to deliver to their consumers accountable. They have incentives to be responsive and nimble.
The fact that they still sometimes act like bureaucracies is troubling for the ideal of government as business. This means that reforms that aim to make government more efficient have a lot to overcome, and that the natural tendencies of government will have to give way to a new way of thinking.
The candidates that can talk about this dilemma, and not just spout clichés about being CEOs for government, will deserve to gain prominence in the years ahead.
Reach Will at wmunsil@asu.edu Click here to subscribe to the daily State Press newsletter.
