Comment by Xylakant
2 days ago
Do roads turn a direct profit? Water works? Canals? Flood Dams? Dikes? Are public parks profitable? Should schools be profitable? Is the police profitable? Does the fire department charge for every blaze they contain? Is the congress profitable? Are the courts? The president? The government as a whole?
Society funds a lot of public services because they cannot reasonably be billed to the individual, but enable the society to function and are the underpinning of economic activity. They are profitable because they allow society and the individuals to engage in economic activity which they otherwise could not.
We should strive to make public services efficient, but aiming for profit is against their very nature.
Or put another way:
Libraries, the fire department, the police department, congress, the courts, and the government are a "cost center". Their services are not directly charged for and on our balance sheet they cost money, however in general the benefit they provide allows all the other beneficial things we want to do to happen and support our "profit centers" like industry. We should work to ensure the money invested is used effectively, but a "cost center" will _never_ turn a profit and asking it to produce one does not make sense.
And for those not following... yes, this is exactly like the IT or legal department in a typical company. At Joe's Widgets the IT department does not charge the customers any money and therefore is a pure cost. But without IT keeping the machinery and networks online, they don't produce many widgets. They pay for their IT department because _overall_ the outcome is better versus going back to manually stamping widgets without computers or automation because "IT costs money". We want to make sure IT isn't spending wastefully, but we can't simply say "IT needs to turn a profit or else we're going to shut them down" otherwise overall things end up less efficient and more expensive and we go out of business.
(As an aside, it's really wild to me how many people in IT can hold the position that "things that don't directly turn a profit shouldn't exist!" while half of our industry is in positions that don't directly turn a profit.)
> The president?
The incumbent has certainly found many creative ways to make it extremely profitable for himself.