Thursday, June 14, 2012

The Reason That Government Agencies Are Difficult To Deal With

Ever notice that almost every trip to the Post Office, Department Of Motor Vehicles, Public Library, Local Courthouse, or Police Station results in long wait times and terrible customer service?  The reason for this is that the government does not operate the same way that a private sector business does.   The private sector uses a profit motive as a guiding force.  For example, if a private sector business is deciding whether or not to embark on the development of a new product line, they will typically conduct market research to see if the long term gains justify the short term sacrifice involved in creating a new product.  Bad planning causes losses, and strong planning creates profits.  Poorly run businesses will eventually fold.  Only the strong businesses survive.

There is no profit motive in a government run operation.  If for example, the local Post Office is taking losses year after year, it doesn't matter because it has a base of tax payers who are forced to financially support its poor business practices.  If a citizen doesn't pay their taxes, their property is confiscated.  The citizens also risk being fined or imprisoned if they neglect to pay their taxes.  People don't like to go to prison, so the Post Office continues to operate like a black hole where reason and logic do not apply.

Here in the USA, we have the (temporary) privilege of being able to print our own currency in any amount needed at any time.  If the tax base cannot support their local Post Office, there is always the Federal Government and the printing press available as a last resort to come and bail out the Post Office with currency created out of thin air.

There are of course long term consequences of using the printing press to support failing government operations.  See also: Greece, Spain, Italy etc.  The consequences of currency printing have been discussed on this blog in previous posts.  Sooner or later the consequences will show and it will not be fun.

                                       

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