The Intersection of Government and the Private Sector

The Politics of Power describes how, “capitalism creates a mobilization of bias that gives the corporate elite a decisive advantage” (Katznelson, 64). I think that this is the most important way that the government and the private sector intersect—through the economy and especially through the interactions of the corporate elite.

In a capitalist economy, the government has to do some regulation of markets in order for the economy to function properly (i.e. so we are not constantly in a recession or depression). Liberals and conservatives disagree about the amount of government regulation that is needed here. “[T]he free market has always been a fiction. Markets cannot exist without a government to maintain order, enforce contracts, create currency, and provide a host of other public goods” (Katznelson, 64).

While the government makes the decisions regarding market regulation, corporate elite can use their money to influence these decisions. They are able to do this through campaign donations, payment of lobbyists, etc.

In a capitalist economy, intersection of government and the private sector is somewhat unavoidable. I believe that government should do more to control capitalist markets and control how much power the elite of the country have over public policy decisions. During the 1930s and the Great Depression, America saw how a more expansive roll for government could be effective. Under Democratic Party control and FDR the government helped turn the economy around. FDR’s “New Deal created the outlines of the modern welfare state to cope with the distress. This was followed by the government’s enormous success in managing and coordinating the transition to a wartime economy during World War II” (Katznelson, 66).

Does our current economic recession need a “New New Deal?”

Sources:

Katznelson, Ira, Mark Kesselman, and Alan Draper. The politics of power: a critical introduction to American government. 6th ed. New York: W. W. Norton & Co., 2011. 2-12. Print.

"An Ol' Broad's Ramblings." An Ol' Broad's Ramblings. N.p., n.d. Web. 13 Feb. 2011. <http://olbroad.com/2009/02/13/>.