The Sheep Says: Private Sector Good, Public Sector Baaad

One of the things I find tiresome is how many people seem to let a sheeplike, 'private good-public bad' mindset lead them into saying really stupid things:

Today's case in point is Harry Koza, writing in the Globe and Mail about Corporate Governance.

Says Harry,

"Don't get me wrong, I'm a big fan of good governance, and there are in fact places where we need a lot more of it, especially in government. In fact, what we need is for governments to adhere to the same standards of governance that corporations do already.

The papers are full of examples: Luxury cars on the taxpayers' dime, vacations paid for with government credit cards, brown paper bags full of taxpayer cash funnelled into political party coffers, e-mails from members of Parliament to pals on Bay Street -- I could go on all day.

You do that kind of stuff in the real world, and the next thing you know you're a cellmate with a 300-pound guy named Bubba. If you work in government, you generally get a pass."

Right, the jails are filled with CEO's and management types who waste shareholders money with frivolous spending on things like luxury cars. <- that was sarcasm, I don't see a lot of white collar folks going to jail and sharing a cell with Bubba.

But don't take my word for it, consider this quote: "Has anyone in Canada -- aside from Viola MacMillan back in the sixties over the Windfall Mines scandal, of course, and she ended up with the Order of Canada -- ever actually gone to jail for a securities offence?"

Who asked that rhetorical question? Why it was Harry Koza, earlier in the same column!

Did any of these charlatans ever spend a day in jail? No. At worst, they have to give back a little of the money they effectively stole and they might have to go without insurance to protect their personal assets in case of their next major screw-up which leads to bankruptcy and total losses for their investors.

I've worked for small companies in the private sector, and I've worked for big companies in the private sector, I've worked for the Provincial government, the Federal government and I've worked for a semi-autonomous government agency. I can tell you beyond a doubt that, at least in the sectors I've worked in, there are more controls, more accountability, and more oversight in the public sector than there are in the private sector. The idea that we need to bring public standards *up* to the private ones is ludicrous.

In fact, I generally find that one of the main benefits of working in the private sector is that you get more of a chance to just do your job, without spending all your time filling in forms, documenting things, looking over your shoulder at auditors, getting things approved multiple times, holding public consultations, completing impact studies, explaining things to public relations officers etc. etc. etc.

As I type, shareholders are seeing millions upon millions of dollars go as compensation for CEO's who are fired for poor performance, and management friendly boards of directors are approving cushy zero-risk contracts for new CEO's which contain piles of luxury cars, enough money to spend the rest of your life vacationing on the shareholder's dime, and far, far too much money to ever fit into a paper bag. Similarly, as we speak, incompetent, unlucky, and, in a small number of cases, corrupt executives are already at work on the next Enron, the next Tyco, the next airline bankruptcy, the next Nortel meltdown or who knows what will be next.

I suspect that, deep down Harry Koza probably realizes all this. It's just that there is such a strong conventional wisdom current of sheeplike 'public sector good, private sector bad' thinking in our culture that it's easy to write a silly paragraph about how anyone who wastes money in the private sector ends up in a cell with Bubba without even realizing what you are saying. If we're going to take advantage of the benefits that good government can bring us, we need to get past this knee-jerk anti-government sentiment.