Polarities

We in America are too comfortable thinking in terms of polarities or dualities.  Things are black or white, war or peace, mind or body, for us or against us, conservative or liberal, etc.  Many of these false polarities deserve attention in their own posts, so I'll focus today on  a favorite political division: public versus private.  Right-wingers are fond of deriding the federal government as a bloated nanny state or a woefully inept bureaucracy, while upholding the sanctity and ingenuity of the private sector.  This division is the cornerstone upon which much of conservative economic theory rests, but the foundations are quite shaky.  Before looking deeper into how problematic of a division this truly is, I want to step back and look at some of the logic that follows this first proposition.  If government is woefully inept and the private sector efficient, then all attempts must be made to keep government from "meddling" in the "private" activities of its citizens.  If only the government would leave business alone, proponents of laissez-faire economics argue, then the economy would be efficient and flourish.  Rather than "wasting" valuable tax dollars on social spending, we should focus on structural reforms (a nice euphemism for drastic cuts to vital programs), and just let the resulting wealth "trickle down."  Because of this philosophy, deregulation is seen as promoting liberty, freedom, and wealth, rather than as a dangerous accumulation of risk.  Here is the simple truth: regulation is not getting in the way of American business.  The ingenuity of the private sector manifests itself most when confronted with government regulation, whether through lobbying to weaken or remove vital provisions, by rebranding or renaming processes to avoid detection, by shifting funds to off-shore accounts or funneling them through subsidiaries, or by "restructuring" a firm, which usually entails laying off a lot of workers to ensure a large enough bonus for the management.  American businessmen are geniuses for creating wealth, but that wealth is not to be shared.  This point is all the more pressing today, seeing as JP Morgan Chase just reported over $2 billion in losses because of unregulated derivative trading - the exact same behavior that led to the financial meltdown a few years ago.  Private companies will engage in the same behavior over and over again so long as it remains profitable to do so.  Yes, derivatives regulation will lead to reduced profits in the financial sector, but it will also lead to greater security - a far greater boon than short-term spikes.  Furthermore, these financial wunderkinds are able to employ various tricks of accounting to make their profits appear exactly as high or low as they desire.  We cannot allow ourselves to kowtow to unaccountable, lying, and thieving banking overlords, because we have seen time and time again how little they care about the implications of their actions.  They will run their companies into the ground, and then laugh as we are forced to bail them out again.  We need a Volcker rule, and not the pared-down bastard child that emerged from the legislative process.
I could go on about the illogic that follows from the public-private division, but the very foundation of laissez-faire economics is suspect.  No private company in America does so independent of the federal government.  Without national education, there is no educated and capable workforce. Without highways and railroads, there is no distribution system.  Without the internet, there is no social media marketing and convenient online shopping.  Without national defense, offshore oil and other manufacturing sites would be vulnerable.  Without government-funding research, a whole wealth of technologies that we use and take for granted every day would simply not have been discovered.  Every day, corporations attempt to saddle the bulk of their collateral costs on the public in order to boost profits.  Without government aid, most private enterprise would fail, miserably.  Without the government, most private enterprises would never have began in the first place. 
One final point I'd like to make on this issue is the falsity of the claim that deregulation shrinks the size of "big government."  The government, faulty as it is, is accountable to the will of the public in many ways.  Corporations are held accountable only to the profit margin and do not serve the will of the public.  When regulation is removed, as in the reduction of the size of the FDA or the EPA, public government is simply replaced with private governance.  Rather than an accountable organization regulating the quality of our food, for instance, self-regulation leads to an unaccountable organization that is no less powerful or no less influential over our lives. We need to realize that simply reducing the size of the government is not a solution in and of itself - we must evaluate the value of the government services and compare them to the cost of providing that service.  Similarly, allowing the private sector greater influence over our lives is rarely beneficial - unaccountable profit-seeking entities rarely keep the public good in mind.  Keep in mind that things are rarely ever black and white, and that the shades of gray need to constantly be reflected upon and reevaluated.