And unlike a government agency, the private owner is obliged by self-preservation to try to avoid losses, which means that he is forced to run his railroad economically and efficiently. And also unlike a government agency, the private capitalist is nearly always obliged to face competition – which means to make the services he provides or the goods he sells superior or at least equal to those provided by his competitors. Therefore the private capitalist normally serves the public far better than the government could if it took over his property.
-Henry Hazlitt (The Conquest of Poverty)
And before you Big State Spittle start foaming at mouth, Hazlitt is right. The Public Sector depends on one and only one thing: taxpayer money in order to “succeed”. And succeed, in the public sector, is merely “just don’t fail”; why else does it, overall, take so few risks? And when it does (again with your money), we get Obama’s failed attempt of being a Venture Capitalist with Solyandra? They basically only have to “serve” their manager for their job.
We in the private sector have to make happy MILLIONS of customers. Before Facebook throttled us, we were serving 1,000,000,000 users per month on Facebook. We worked to satisfy those million people with the posts that we were writing on all kinds of issues. They had a need and we filled it. For if we weren’t, they wouldn’t have come back.
Hazlitt is right – constant and ever increasing competition, each either trying to add new features to attract new customers or becoming more efficient in order to offer lower prices for the same product. And entrepreneurs are creating new products in brand new markets (like cell phones, streaming media, just to mention two). The private sector has to innovate – or die (or at best, be an also-ran).
When’s the last time you saw innovation within most Government agencies?
(H/T: Cafe Hayek)