Capitolism

Independent in All Things, Neutral in Nothing

Dependence on Government

with one comment

Emily Maltby writes an article today detailing some of the challenges small companies have in obtaining Federal contracts. The last two paragraphs worry me:

“Mr. Lebolo, however, is shifting his firm’s strategy to primarily focus on government work. “I made a determination to look hard into the federal market because it was the only place with money,” he says.

“He says he’s not frustrated by the relatively small price tag of his first government assignment. Now that the process of landing a contract is behind him, he says there is no going back to commercial construction. He hopes to grow and begin hiring again by the end of this year. “This is a long-term decision,” he says.”

When the government becomes the sole or dominant market for several sectors in the economy, what will happen? Will that prove beneficial to the economy? Will that situation increase or decrease innovation? Will it stimulate creative solutions to business and human problems?

I’ll have more to say about these questions, and this increasing trend of reliance on government for business’s economic well-being. But I don’t think it bodes well for the economy, creativity, innovation or America’s competitiveness in the global marketplace.

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Written by Russell S.

April 21, 2010 at 4:30 pm

One Response

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  1. Don’t forget about the graft it will bring. Private sector firms have their own corruption problems, but because they have to worry about the bottom line they’ll have an incentive to go for the most effective/efficient/affordable option.

    Bureaucrats don’t have that incentive. They’re harder to fire, and they usually don’t worry about the bottom line because it’s other people’s money they’re playing with.

    RJS

    April 21, 2010 at 7:59 pm


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