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The Failure of American Government as Business

March 10, 2013

I was reminded today of an American failure of the modern era.  Some of the characteristics of America which made her great, like hard work, honesty, and thrift, have been nearly forgotten with many of my generation.

We wonder at the incomprehensible national debt and it’s growth.  We wonder at households spending far more than their income.  We are amazed by the entitlement mindset that expects to sit idly and rely on the government for basic needs.

I believe that there are a couple of basic business principles that have been forgotten.  I believe that these principles, if followed, could result in unprecedented growth and prosperity, both on a personal and national level.

Allow me to illustrate our failings with my observations of two businesses that failed in my area in the last three months.

The failure to spend less than is made

The first business that I saw go under recently looked very healthy to the casual observer.  As home improvement contractors, they were always busy.  They worked on nice projects, did prompt work, and had happy customers.  However, they were buying materials for their projects on credit, and failed to keep good standing with their creditors.  In the end, they were taken to court, and pieces of their business were given out to various creditors in an attempt to satisfy (at least partially) their debts.

The failure to live within one’s means

The second business that died in my area recently had a problem that was only slightly different.  While the business books were well kept, the owners gave themselves a salary that the business couldn’t support in order to live the lifestyle that they wanted.  They sacrificed their future for the present.

The failure of the American Economy as a business

The problems our economy is currently facing are large scale results of the same problems.  Our national mindset seems to be one of unchecked and unscheduled spending.  This spending reminds me of the first business I mentioned, and could bring similar consequences to our nation.

The failure to live within our means is also a large one.  You might know it better by the term, “Keeping up with the Joneses.”  While some may say this is only a personal problem, I find it hard to believe that we could rationally expect our government to balance their budget when we are unwilling to do the same.

Many of the problems we see with our government can be traced to failures that are common on a personal level in our society.  These are only two of them.  Perhaps we would do well to remember this the next time we feel the urge to criticize.

Thanks for contemplating my thoughts,

Dave

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