Monday, March 1, 2010

Someone at Harvard Business Review and at McKinsey Get It...

..that Big Government is exploding, since the Harvard Business Review reported on a McKinsey survey about the intrusion. Here's HBR:
Executives responding to a new McKinsey survey say that their companies' economic value will be influenced more by governments than by any other group of stakeholders except customers. Government involvement in most of the respondents' industries has skyrocketed since the economic crisis began, and the results indicate that most of them expect it to continue increasing.
Here's McKinsey:

Government is likelier to affect companies’ economic value than any other group of stakeholders except customers, say executives in response to a new McKinsey survey.1 The results also indicate that most executives expect government involvement in their industries—which in most cases has skyrocketed since the global economic crisis began—to continue increasing. The survey asked executives about their companies’ relationships with the government of the country or region that is their primary market: how government affects their companies’ economic value, how their companies interact with the government, how effective those activities are, and who spearheads the companies’ relationships with the government.

The results show that government actions have a significant effect on companies’ economic value: 34 percent of respondents say 10 percent or more of their operating income is at stake. Some government actions, such as providing infrastructure and access to capital, are likelier to have a positive than a negative effect on company finances. However, passing laws and setting policies—the actions executives say most often affect their companies’ economic value—have an overall negative effect. Respondents whose primary markets are in developing economies are more positive than others, however, about the effect of government actions, such as the passage of laws and enforcement of rules.
Of note, neither HBR nor McKinsey come out and state that the entire idea of big government growing is a bad thing. Are they being politically correct by not stating the implications? Do they not understand the serious implications? Perhaps, part of government growth can be pulled off because of the failure of the HBR's and McKinsey's of the world to aggressively warn of the dangerous ramifications. Do we have more sheeple here?


  1. This, government intervention in and regulation of private businesses, is the catalyst for Great Depression 2 Phase II.

  2. Nice post. I completely agree. Way to call them out!

  3. One of the gravest consequences of this paradigm, is that companies, to better position themselves against the competition, will allocate more and more resources--including the best and brightest people--to the unproductive and wealth sucking activities of lobbying and rent seeking instead of R&D or process innovation.