Ernest Grumbles III

Ernest Grumbles III is an IP (intellectual property) and business development attorney at the Minneapolis firm Adams Monahan, where he works with entrepreneurs and early stage, tech-oriented enterprise. He is also Co-Founder of MOJO Minnesota, a collective supporting entrepreneurs and promoting innovation policy and community in Minnesota. He enjoys fresh air and lots of caffeine and is constantly trying new things (instead of sleeping). He may be reached at: egrumbles@adamsmonahan.com.

Is Government the Enemy of Business...? No.

Posted by: Ernest Grumbles III under Society, Politics Updated: April 1, 2011 - 7:48 AM
In a previous post, I shared some thoughts on why entrepreneurship is a social justice issue – namely that innovation and commerce are fundamentally human activities. You can’t separate people and business.  And the business of the people is what generates amazing opportunities for growth, creativity and improvement in quality of life. In short, “business” is not the enemy of the people, but a vital activity of the people and society at large. Individual businesses that get this tend to have amazing success. 
 
I wanted to flip this around and deal with another false supposition – that government (of the people) is somehow an enemy of business. There is talk (and action) in a number of states to strip government of its economic development role based on the notion that government can do nothing to promote the economy, only shackle it. But government is not the enemy of business and the economy – anymore than it’s the enemy of the people. 
 
Government is Us
 
Let’s start with a different way to think about government. Government is not a “them.” Neither is “business” a “them.” Rather, both are “us.” We have the privilege and good fortune to live in a democracy – meaning, the government is picked by us. And that’s true at every level from city council all the way up to the President. The government is us, which, in 1776, was a radical notion. For better or worse (I think better), we don’t get to point to government as something imposed on us from above, but rather something raised up from the people. If you’re looking at government (or business), you’re looking in the mirror. And that includes everyone, even people you don’t agree with.
 
Civil Order is Essential to Society and Business
 
What about the notion that government is simply unnecessary? Let’s rewind for a minute. Imagine a scene on the landscape a million years ago. After a successful outing bagging an oversized mammal, two good folks got into a tussle over dividing it. Next thing, one is about to club the other into submission and it’s an all-out melee. Up walks the biggest/strongest member of the group, realizing chaos is about to ensue, and demands that the fighting stop (under penalty of more pain). The two fighters scratch their heads and figure out a better solution. Thus was born the rather common sense solution that an impartial figure could mediate conflicts and prevent them from happening in the first place – government. 
 
While we would be better off individually (for a short time) if we could do exactly what we wanted whenever we wanted, we would all collectively be worse off. Would you extend that privilege to all of your neighbors? People in other cities and towns? The answer is no, of course. Take pollution laws. Do you really think people should be able to dump garbage in city parks? Or dump harmful materials in lakes and streams without meaningful controls? While some people and businesses could save money by dumping, we would all be worse off, especially future generations. 
 
Government then acts to balance various private interests for the aggregate common good – a tricky feat no doubt. But a worthy endeavor. We, as the people, have the right to establish minimum standards of conduct that we all have to live by – whether as citizens or as the businesses those citizens create. Maintaining civil order and accountability to these minimum standards is what enables commerce to occur in a peaceable fashion – a level playing field for new business creation and innovation. Speaking of playing fields, wouldn’t it be great if we could get rid of referees and out of bounds in football? How about annoying rules against personal fouls? Clipping anyone? Exactly. The game would turn to chaos, and people would abandon it - like businesses do with commercial markets that lack order, regulation and consistency.
 
So government is – the people, giving voice to the people in all their variety – and it acts to prevent chaos and “ensure domestic tranquility.” Businesses rise and fall, but government must persist through it all. There are simply too many common problems in civil society that private business is unable or unwilling to address. 
 
Does the foregoing mean that government is always run smoothly, efficiently and honestly? No, clearly not. It’s a human institution. There are many ways government can be run better to achieve public good at lower cost. Are all private businesses run smoothly, efficiently and honestly? Of course not. But we hope most are. Government is not the enemy. And neither is business. Rather, poorly run government and business are the problem.
 
Government’s Essential Role in Economic Development
 
So let’s re-focus on government’s role in economic development. While government’s role as civil referee is critical to a stable economy, we can and should expect our government to be more than reactive on issues of economic development. Government can, and must, afford to take a longer range view than business. In close collaboration with the private sector, government can move on public policies and public-private initiatives that open new markets, support entrepreneurs, maintain a steady supply of educated, enterprising folks, preserve infrastructure and maintain that level playing field to let business – another vital human institution – thrive.
 
Will government be the primary player in economic development? No. It needs to come organically from citizens driving their dreams, creating new products and service, and generating opportunities for new jobs and new business development. On the converse, will business be the primary protector of public good? No. While businesses need to have a strong sense of community engagement and community values, and act on such sense, they need to drive for market success and compete in a way fundamentally different than government. We need both, working together in an open, honest, creative and non-adversarial way to keep forward progress.
 
So to the folks around the country pushing to out-source, privatize, and/or shutter government programs around economic development, I would first ask what steps they have taken to engage with government to evaluate, discuss and improve existing programs. Have they sat down with their fellow citizens in government to work on creative solutions? Have they considered the increased cost to their communities of shutting down existing government programs and creating brand new private ones (that will need foundation funding)? It may very well be that certain government programs are ineffectual and need to cease. But going into this analysis with the false belief that government can only hinder commerce pre-ordains the conclusion. 
 

Business and government, time to friendly up and have honest discussions about the critical role that each plays in our common peace and prosperity and how to achieve outcomes efficiently and collaboratively. 

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