Is A Country A Business?


A country is not a business. You don’t hire and fire citizens as needed to improve your bottom line. You don’t sell shares in your country to the highest bidder. The purpose of a country is not to maximize ROI for its shareholders. You don’t acquire other countries or spin off parts of you that are unprofitable (well, they did that in the past, but not much anymore – because it did not really work). You don’t evaluate your citizens every 6 months for performance and give them ratings (or worse, “stack rankings”). The country’s citizens aren’t its employees or customers or suppliers. A country does not compete with other countries with the stated goal of driving them out of business (doing so usually results in a flood of refugees into your country). And finally, a country can not just dissolve itself if it fails.

Sure there are some similarities between countries and businesses, but there are also a lot of very fundamental differences. Just because an entity has a budget and a balance sheet does not mean it is a business. A family has a budget and a balance sheet. So do we run it like a business? Hire and fire children? Sell shares in your family to your neighbors? Any of those things mentioned above?

In fact, there are more similarities between countries and families than countries and businesses. Then why do we think that running a country like a CEO is a good idea? Shouldn’t we expect the leader to run the country more like the head of a family?

Moreover, this idea of running the country like a business has become so appealing to some that, just like a person with a hammer thinks that every problem is a nail, they have started thinking that the ideas used to run a business could be applied equally well to run a country. If you take this idea far enough, the ultimate “nirvana” for people who believe that a country should be run like a business would look like this:

  • The only ways for a human being to relate to a country are as an owner, or an executive, or an employee, or a customer, or a supplier.
  • The fundamental purpose of a country is to provide constantly rising ROI for its owners. An owner is typically a land or a natural resource owner, or an intellectual property owner, or even a human resource owner. Basically the owner of some revenue-generating part of the country.
  • In order to do this, the country exploits its natural resources (air / water / forests / minerals etc.), ideas, strategies, and intellectual property, as well as its people (i.e. human resources) to their fullest capacity with no regard to unprofitable ideas like freedom, rights, laws, or even “life, liberty, and the pursuit of happiness” for its people.
  • The country hires and fires people as needed. When it needs people, it opens its borders and lets the most highly qualified people in to fill the vacant positions. When it needs to slim down, it forces the “superfluous” unqualified people to leave the country.
  • The country treats other countries in the world the same way a business treats other businesses. It tries to use its strengths as a military behemoth to extract the most exploitative deal possible with the explicit intention of hurting the other country to the maximum extent possible. The country declares victory only when the other country basically goes bankrupt and dissolves.
  • The only way for people to escape this cycle of hiring and firing and exploitation is to become an “owner” themselves i.e. a land owner or natural resource owner or an intellectual property owner or people owner. That way, the person become a shareholder in the country and that’s the only way the country starts working for you instead of you working for the country.

Sounds familiar to the philosophy espoused by some of our leaders? Is this what you really want? Is this why we, the people, have a government and elect leaders? Is this why we believe in ideas like “we hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the Pursuit of Happiness.” (Just in case someone is not familiar with that line, it is a prominent line in the United States Declaration of Independence. It was the basis on which the country was founded.)

Don’t get me wrong. I am not anti-business at all. I completely believe in business and capitalism – for its intended purposes. The purpose of capitalism and business is to channel our basal instincts (fear and greed) and our enterprising nature, our talents, and our energy towards productive, and socially as well as personally beneficial activities. Not providing this channel to people leads to stagnation, malaise, frustration, and even disintegration. But that does not mean that we should take it to the other extreme and start treating every other aspect of our lives as unimportant. Human beings also have other needs such as “life, liberty, and the pursuit of happiness”. We do need to feel part of a family, a community, a country, a world. We need to have meanings in our lives beyond just getting the highest ROI.

People came up with the idea of a country and a government to rule over it because they realized that free enterprise alone was not able to fulfill all our needs. We needed something more. It is true that businesses freely competing with each other can give us many of the things we want. But we also know of many instances where businesses can collude among themselves or deceive people or devastate our environment. We are familiar concepts such as the Prisoner’s Dilemma and the Tragedy of the Commons. We need some entity to watch over businesses and ensure they don’t behave in ways that hurt the country and its people rather than help it. People decided to give this job to the government.

Of course, the opposite is also true: Governments alone can not satisfy all the needs of their people. We have seen many instances of that too where governments took on this impossible task all by themselves and screwed up massively.

What we truly want is an honest, vigorous, and responsive debate and practical solutions coming out of it. We want a give and take between businesses on one side and government on the other. We want a dynamic and responsive balance to the changing conditions of the world. We want a focus on the long term survival and happiness of our people, not just on the short term profit of the owners. We want to truly, pragmatically, and intelligently work towards “life, liberty, and the pursuit of happiness” for our people without getting bogged down in the idea that one side has to “win” over the other. Realizing that, and finding ways of achieving it is the clear, present, and ultimate challenge of our time.