The Problem With Government Is…

That line has to be the beginning of so many cocktail party screaming matches, hahaha.  Anyway, get ready for a full on rant.  In no way should this be regarded as political science research of any kind, and I have no facts to back any of this up, it’s all anecdotal.

It’s become obvious to me lately, that the problem with government is quite simple, there’s not enough money involved.  Yea, I said it.

I’m not talking about money to be spent, I’m talking about money to be made.  I have a core belief in life, you get what you pay for.  Think about it, it comes into play every day of your life, you pay people for services or things.  You get the quality of work or goods that you pay a certain price for, because we live in a market economy, where supply and demand find equilibrium at a certain price negotiated by all market participants.  Now that’s going a little too Econ 101 for this rant, but whatever.

My point is this, if you buy a 40$ pair of sneakers, you’re getting the quality of a 40$ pair of sneakers, pretty crappy.  If you buy a 120$ pair of sneakers, you get quality, you get durability,  you get technology.  Now, the quality of the product isn’t the only thing that goes into its price though, we need to think about what the company’s target margins are, how much they are able to mark up their products or services because of their brand name, and many other things.  I think it’s asinine to buy a suite for more than 1,200$, just completely crazy.  The difference between a 1,200$ suit and a 4,000$ suit is negligible.  Now the different between a 500$ suit and a 1,200$ suit is huge.  You get fair quality for the 500 to 1200 jump, you don’t for the 1200 to 4000 jump.

Let’s come full circle now.  You also get what you pay for when it comes to people.  If you run a company and offer 40K a year for a position you are going to get a low caliber of individual to fill that role.  If you offer 80K a year you are going to get a higher caliber of talent to work for your company, and if you offer 120K you are going to get an even higher caliber of employee applying for the position.  The key for the employer is to make a judgment based on his view of the job market and just how smart a person he really needs working in that position, how much should the position pay.  Sometimes, like the last few years in the financial sector, you can lowball the crap out of the job market and get great people, because there are so many good ones unemployed.  Sometimes, like the middle of this decade, you end up paying too much for dumb people because you are growing your business extremely fast and just need to fill seats quickly.  And sometimes you get it right, and the pay fits the person well, the labor market is in equilibrium.

You get what you pay for when it comes to people, unless you aren’t a good judge of people in general, then you’ll probably end up overpaying.

Government is the same way.  But instead of government raising wages for certain positions to get the talent that is needed for that position, they don’t.  I’m not going into why this is that they don’t pay up, that’s for someone else to rant about.

So what happens when you pay people in government too little?  You get crappy people working for your government in very important roles.  There’s not enough money in government service for talented people to work there for longer than a few years.  Even our elected politicians get paid crap.  And what’s worse, the people doing the menial government work, the unskilled government work, mostly in local government, get paid way too much.  President Obama said as much the other day, he proclaimed that wages for unskilled government labor were probably too high, and wages for skilled positions were too low.  This came from the budget office.

By the way, this isn’t exclusive to our government, low government wages around the world at high levels in my mind account for most of the corruption.  If you paid the top people in each organization as much as they would get in the private sector, they wouldn’t have as much a reason to be corrupt.

It used to be, back in the 30′s, 40′s, and 50′s that it was honorable to work for the government.  The 60′s changed that, the government stopped being seen as something worth participating in and began to be seen as something to be fought against.  And for good reason, our government fucked up a few times real bad, not least by sending our boys over to Vietnam to get slaughtered, not for little reason, there was good reason, but with no good strategy and the willingness to allow the slaughter to happen.

Anyway, so you can rule out prestige from reasons to work for government, save for a few top jobs, and even then the people don’t stick around too long because they are using the job to get to the private sector to make some real money.  Now, the only way you get good people in government jobs is by hiring or electing rich people who don’t need the money, or paying them market salaries, which leads me to my conclusion.

You may think this sounds like an elitist view, I don’t believe in that word, I think it’s complete bullshit made up by populists to raise anger in poorer and less educated populations, but even if you looked at it that way you would be wrong.  The fact is that I would rather elect a rich, well educated, politically entrenched guy, than a poor, uneducated, newbie to the political world.  No, I’m not talking about Obama in either sense, he was poor but very well educated, and he was an outsider, so he doesn’t fit either mold.

Let’s just use the Kenedys as an example.  Not my favorite politicians, in fact I think they were too liberal for my tastes, but they knew how to run a government.  This wasn’t amateur hour, it was for real.  They were rich, they were extremely well educated, they knew politics inside out and how to lead.  The whole focus on being inside our outside of the Washington scene is the wrong focus, it should be on getting competent people into office who don’t need the money.  Or maybe for a change we could see that some people who have made a ton of money on their own, made it for a good reason, because they were damn smart and knew how to run a business, or climb a corporate ladder, a similar skill to politics.

For better or worse we do not live in a country where a select group of individuals at the top elects technocrats to government posts (see China).  If we want a better functioning government, we’ve got to pay the people who make it run more money to get the best talent.  This argument about bigger or smaller government is bogus, I don’t care how big my government is, I care about how efficient and talented it is.  Pay the people at the top market rates for their services, and break the government unions at the bottom which have won stupid salaries for unskilled workers costing our government way too much money.  Elect politicians who are already wealthy and well educated, stop it with this populist one of the people crap.  I don’t want someone like me running my government, I want someone 10 times smarter than me, who makes me look like an idiot.  I don’t want Joe six pack, I want Joe computer nerd who made a billion bucks with his revolutionary idea, or Joe Montana who lead his team to 4 out of 4 Superbowl Wins.

Until quality people are willing to go back to work for the government, either because of prestige (not likely), or decent salary (keep praying), or sense of service (not likely), we’re going to have a crappy government.  Until we start electing politicians who are rich, smart, and know politics, we’re going to have crappy politicians.

You get what you pay for in life.

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