Why CEOs Are Bad Presidents

        Alan S. Blinder has written an insightful article, The Case Against a CEO in the Oval Office.  The most interesting part is where it was published—The Opinion Page of the Wall Street Journal.  I’m sure that the people who regularly read that page will find it a bit painful to discover why a businessman can’t run a country. Alan Blinder teaches economics and public affairs at Princeton, and is a former vice chairman of the Federal Reserve.

              Romney touts as his main qualification for the presidency the fact that he is a successful corporate CEO. But Blinder points out that the presidents which are remembered by members of their own party as effective presidents—he lists Washington, Jefferson, Lincoln, both Roosevelts, and Reagan—all had one thing in common.  They all had little or no experience in business.   And except for Washington, none had any experience whatsoever.   And he reminds us that Hoover, one of the most successful businessmen this country has ever produced, was our least successful president.  Hoover was intelligent, hard working, and honest.  But he kept trying to run the country like a business.  This didn’t work.

            Blinder says that the qualities which make a person a successful corporate CEO are not the qualities of an effective president; in fact, they are the very qualities which doom a presidency.   Corporations are run like dictatorships, because dictatorships are efficient, and a corporation has no goal except to be efficient, especially at making money.  A successful CEO is usually a hard driving egoist who develops his own plan and then bulls it through over all opposition, quickly and without compromise.    But democratic republics are not dictatorships. Our system of checks and balances was specifically designed prevent a complete takeover by any one individual.  Every president must secure the cooperation of the majority of both houses of Congress, and act only within the constitution.  Only through compromise and persuasion can any of the president’s plans become law.

            Another problem which Blinder cites is that a corporate CEO’s guiding principle is to follow whatever path works to improve the “bottom line.” For a corporation, this is sufficient, because a corporation has no real function except making money.  But in the running of a country, there is no bottom line.  Or, more accurately, there are several dozen bottom lines, each competing with and contradicting some of the others.  A democracy must simply provide a safe, free, and prosperous environment for its citizens, but there is no one number that can ever define this.   Blinder concludes: “The business of America’s government is not business.”