My point in this
commentary, which I present upfront here, is:
The purpose of business
is in stark contrast to the purpose of government and so, when electing
officials, we should elect people who have a grasp of the government systems
rather than people who will try to run government like a business.
The goal of free market
business is to make a profit for owners and shareholders.
The purpose of production
and sale of goods and services is to make the business profitable.
The accounting method,
known as Financial Accounting and Reporting, is structured to identify income,
expenses, and resulting profit or loss which then impact the balance sheet of
Assets, Liabilities, and resulting Equity.
The management systems
are in place to efficiently affect productivity.
The whole mindset of the
organization is toward profit. Not charity or social conscience.
In short, financial
accounting asks “How much did we make or lose?”
Contrarily, the goal of
government, much like charitable organizations, is to spend money and apply
other resources so as to provide goods and services; not to make a profit.
Deficits in business
immediately affect equity negatively.
Deficits in government,
if managed according to predetermined policies, can achieve favorable economic
conditions.
The accounting systems
for governments, usually known as Fund Accounting, differ from Financial
Accounting and Reporting.
Government Accounting
aims to see that the funds are received, applied, invested, and spent according
to policy and law.
In short, government
accounting asks “From whom and where did the money come and to who and where
did it go?”
Business accounting is
all about profit.
Government accounting is
all about policy.
Having formally studied
both, Business Management and Public Management, I have concluded that much of
our problem in government is that far too many business-minded people are
trying to run governments as if they were businesses.
Of course, many people
who have been good in business can, with diligence and reordering of their
management mindset, become effective at governing.
But, I think our
governments are at a precarious moment and are in need of managers, leaders,
and politicians that can navigate the public policy arena free from the
hinderance of the business profit/loss mindset.
As we move toward
election day in November, become accurately informed of candidates. Vote
for the candidates that understand government policy rather than quarterly
corporate financial statements.
To become accurately
aware of the qualifications of candidates, familiarize yourself with a
candidate’s work history, was it about self-serving profit or about service to
others?
A candidate’s history of
service to others will reveal the creative capacity to achieve policy
objectives, often with meager financial and volunteer resources with which to
work.
Business people know how
to make money.
We desperately need
people that understand how to implement policy, law, and government.
They likely will not be
the headline grabbing, envy-stirring, greed advocates such as Gordon Gekko of
the Wall Street movie.
And I don’t expect Mother
Teresas on ballots in November.
But I would definitely
vote for those candidates that more closely resemble Mother Teresa rather than
Gordon Gekko.
Voting citizens cannot
abdicate their responsibility to be accurately informed.
