Let's Not Romanticize Business: My Comment To Kling's "Business Experience" Post

My Comment to "Business Experience" by Arnold Kling on EconLog:

Let's not romanticize business.

Business people are doing stupid things all the time and some demand unachievable things from their workers. Some companies even try to bring products to market before all the details are worked out and all the kinks in the design and necessary inputs are resolved. Many products fail. Many bosses are tyrants.

The difference is that in business, the marketplace and the consumer will not buy and will punish a business for a product that does not work or is not developed.

In politics, voters do not bring the same negative consequences to politicians that the market brings to companies. A politician who introduces and votes for legislation that requires the use of a non-existent fuel, and penalizes its non-use, can be reelected because he says he was trying to help the environment or his local economy, even without achieving measurable positive results. He can even put the blame for failure on the companies by saying they are not investing enough in new technologies or are delaying implementation of better strategies for more profit. It becomes his word against that of greedy business.

Consumers are much more discerning about what products they buy with their hard-earned dollars than they are with their votes for politicians.

The discipline of the marketplace distinguishes business from politics.