PA Writing Assignment

PA 315 GOVERNMENT

BUSINESS RELATIONS CHAPTER 1

California State University San Bernardino

College of Business & Public Administration

Professor Sharon Pierce

DEFINING GOVERNMENT-

BUSINESS RELATIONS

Business Government relations – how the public and private sectors interact in

their numerous complementary, cooperative, and conflicting roles.

RELATIONSHIP BETWEEN GOVERNMENT AND BUSINESS

https://iedunote.com/government-business- relationship

Government = ensure economic stability and growth vs. Private Business = profit

GOVERNMENT BUSINESS RELATIONS

• Major factors shaping the relationship: • Mix of strategies used for implementation of public

policy

• Monetary policy

• Fiscal policy

• Amount of government protection of society’s most vulnerable

• The amount of promotion of the business sector domestically

• The influence of the private sector on government policy making and administrative actions

MIX OF STRATEGIES USED FOR IMPLEMENTATION OF PUBLIC POLICY

• government ownership

• partial ownership (government corporations or government backed corporations or state-owned enterprises)

• public- private partnership (P3s)  is a contractual arrangement between a public agency (federal, state or local) and a private sector entity – which the government has been using a great deal more in the several administrations

• contracting out - These types of activities include contracting out with for-profit vendors, non-profit organizations, and local government agencies from other jurisdictions to continue the delivery of public goods and services

• procurement – secures purchases

• tax incentives

• regulations

MONETARY POLICY

FISCAL POLICY

• Fiscal Policy -  is considered any changes the government makes to the national budget in order to influence a nation's economy.

• Trump - Tax Cuts and Jobs Act

• Obama – in 2010 – the affordable care act

• Bush – in 2008 – create policies to counteract the 2008 financial crisis

• Clinton – 1996 he cut spending the TANF program or what was considered welfare

• Reagan – Reaganeconomics – he based his policies on the theory of supply side economics that says increased production drives economic growth – tax cuts and deregulation

• Gives incentives to businesses to expand while removing restrictions to encourage growth

WHY GOVERNMENT AT ALL?

• The need for government, however, does not mean that government itself cannot • Underperform

• Perform very badly

• One purpose of this class: provide tools for fair analysis of success and weakness of government in general, and the role it plays with its roles with business.

WHY GOVERNMENT AT ALL?

• Hobbes: Without government life would be “continual fear, and danger of violent death; and the life of man, solitary, poor, nasty, brutish, and short.”

• What government does, in the modern world is enormous and its contribution is indisputable. Can you imagine a world in which… • All airplanes have “flyer beware signs” because there are

no safety regulations, except there would be no one to enforce such signage!

• All roads would be private roads and most would be toll roads!

• You would need to pay for fire protection or the fire truck would not put out your fire (as it was in colonial times)! And so on.

DEBATE ABOUT THE ROLE AND SIZE OF

GOVERNMENT

HISTORICAL BACKGROUND ON GOVERNMENT

TWO DISTINCT INTELLECTUAL TRADITIONS

• Adam Smith

• The Market-oriented tradition

• Government lacking the qualities

• Nonintervention by the state

• Freely operating markets.

• Alexander Hamilton

• The active government tradition • Associated with mercantilism

• Government controlling all aspects of economic activity

• Aiding fledging industries by providing economic assistance and tariff protection.

LAISSEZ-FAIRE VERSUS ACTIVIST GOVERNMENT

APPROACHES• Laissez-faire: “leave it alone” or less government is better • Adam Smith

• Hayek Milton Friedman (Supply side economics)

• Best examples today: Anglo-countries, Switzerland, Singapore

 Mercantilism: more activist approach  Alexander Hamilton  Keynes (Keynesian

economics, e.g., countercyclical spending, social and physical infrastructure, etc.)

 Today seen somewhat in corporatist economies of East Asia (i.e., strong state involvement)

THE RELATIVE SIZE OF GOVERNMENT

RELATIVE SIZE: EMPLOYEES (ABSOLUTE NUMBERS)

Local government employees – almost 24 million State Government employees – almost 8 million Federal government employees – about 2 million

WHY IS OUR GOVERNMENT DEBT GROWING?

• Complex societies place greater demands on government

• Wars and other national calamities

• Many special interests are successful in finding a place in the public sphere over time.

LIMITS OF GOVERNMENT EXPANSION

• The natural aversion to taxes is seemingly universal.

• As governments become larger and occupy more of the economy, the more they can become political targets if they are not successfully managed.

THE MOST BASIC ROLES OF GOVERNMENT

•Defense

•Public safety

8 GOVERNMENT-BUSINESS ROLES • Fiscal structure

• Regulator

• Safeguard against risks

• Provider of infrastructure

• Purchaser

• Social architect

• Service provider

• Promoter of business

THE GOOD, THE BAD, AND UGLY OF GOVERNMENT

THE GOOD… (GENERALLY STRENGTHS)

• Providing a stable financial system

• Providing a social contract for a stable society

• Public welfare

• “The commons”: shared goods like roads

• International and domestic safety

• Reducing risk

• Shared social infrastructure, e.g., K-12 education

THE BAD… (GENERALLY WEAKNESSES)

• When governments take over areas completely and become monopolies (or dictatorships)

• Government corruption

• When government takes on too much and gets over-extended

• Becoming excessively complex, e.g., tax code

• Dealing with special interests over time

• Inefficiency over time

THE UGLY… (IMPORTANT THINGS THAT GOVERNMENT DOES BUT EITHER ARE NOT

UNDERSTOOD OR APPRECIATED)

• Taxes: necessary but hated (excessive taxes are bad but then we must decide what “excessive taxes” means)

• Foreign aid (example of necessary item that is hated)

• Government doing the unpleasant jobs, like prisons

AMERICAN GOVERNMENT INSTITUTIONS

How many governments do we have in the United States of

America?

# OF GOVERNMENTS IN US

WHAT DOES THE FEDERAL GOVERNMENT DO?

WHAT ABOUT CALIFORNIA STATE GOVERNMENT?

WHAT ABOUT CALIFORNIA LOCAL GOVERNMENTS?

BIG GOVERNMENT VS.

SMALL GOVERNMENT –

WHICH IS IDEAL FOR THE UNITED STATES?

FACTORS AFFECTING THE ROLE AND SIZE OF GOVERNMENT

• 1. Population Density – government grows larger as the population grows larger

• 2. Size and Complexity of the Economy – in the US – early 20th century less industrialized and more agriculture

• 3. Interaction with Other Countries - globalization

• 4. Social Goals and Beliefs – basic needs of food, shelter, and clothing need to be met. Also – employment, good schools, retirement

The role, reach, and impact of government is directly affected by a range of factors:

WHAT IS THE IDEAL GOVERNMENT?

• QUESTION –

• What do you believe is the ideal role of government?

HOPE YOU ALL HAVE A GREAT WEEKEND!