In the last presidential debate earlier this month, Donald Trump and Carly Fiorina spent a fair amount of time arguing over each other’s records in business. The testy exchanges between two business people who have never been in government raise the question – would a CEO make a better president than the decades of politicians who have held the job?
Of course, all leaders of large and important organizations have some skills in common: they need to be intelligent, knowledgeable about the relevant issues, able to manage a staff and able to communicate effectively to people inside and outside their organization. But the job of U.S. president differs in some important ways from the job of CEO. Because of that, presidents face challenges that CEOs cannot imagine.
Let’s start with size. The Federal Government is big. Really, really big. For instance, total revenue of the federal government ($3.9 trillion in 2014) is slightly larger than the size of the top 25 Fortune 500 companies — Walmart (WMT) through Marathon Petroleum (MPC). Most of that revenue goes to American citizens in the form of transfer payments – social security, Medicare, military retirement etc. And, in terms of employment, total government personnel (4.185 million – including military) totals the personnel of the top 6 Fortune 500 companies – Walmart through Target (T).
The job of previous presidents wasn’t nearly of today’s scale. Back in the middle of the twentieth century, the federal government was smaller and relatively simpler. It was composed mostly of clerks who recorded social security payments, veterans benefits, etc. But by the twenty-first century, many lost their jobs to the convenience of computers. What’s more, clerks were replaced by programmers, lawyers, doctors, molecular biologists, nuclear physicists, engineers, and a whole host of other specialists. The federal government today is so big and so complex that presidents – even ones with extensive political experience, but especially those with limited experience – have trouble figuring it out. Not only is today’s federal government enormous, it is constructed in a way that most CEOs would find simply unimaginable.
Let’s start with the employees. There are two classes of employees in the federal government – career or civil service employees and political appointees. The political appointees are chosen by the president, who serve at his or her pleasure and almost always leave when the president leaves. Sometimes these folks know what they are doing. Sometimes they are simply political hacks. But the bigger problem is that they simply don’t stay around very long. The modern tenure of political appointees has been around two years. By contrast, the career employees or civil servants are around for a long time. Senior civil servants are often in the same agency for 25 or 30 years before they retire. They know where all the bodies are buried and they have served under many presidents. If they don’t want to do what the president wants them to do they know that they can simply wait him or her out. Finally, the civil servants outnumber the president’s appointees by margins of about one thousand to one and the president can’t get rid of them because they are protected by law. I can’t think of a CEO who has ever managed a workforce where the vast majority cannot be fired.
The second big difference is that all government workers work under a set of rules that seem designed to impede managerial discretion to a degree unheard of in the private sector. Because of the way Congress writes and passes budgets, many agencies find that it is impossible to transfer money from one part of their budget to another without going back to Congress and asking for something called “re-programming” authority. Of course, the rationale behind this law is to keep the Executive branch from spending money on things that Congress didn’t approve. But in all too many instances, the practical effect is to tie managers’ hands and keep them — for instance — from transferring money from the training budget to the IT budget.
Which brings me to the final thing about the president’s job that is sure to drive a former CEO crazy. The president’s workforce doesn’t, in reality, work just for him or her. In fact, while career civil servants are part of the Executive Branch, they are, in many instances, more concerned with what Congress expects of them than what the president expects of them. That’s because Congress is the ultimate decider on how much money they get or don’t get. Imagine being a CEO and trying to run a company that has more than one board of directors. Sometimes the second board of directors is friendly. Often, especially these days, the second board of directors is hostile. And just to complicate the matter, frequently a cabinet department is accountable to more than one congressional committee. Think multiple boards of directors.
All of this complexity and lack of control will make certain types of CEOs want to pull out their reddish blonde comb overs. The business of the president of the United States is not business. It’s politics, and all the messy sharing of power that the Founding Fathers wrote into the Constitution.
Elaine Kamarck is founding director of the Center for Effective Public Management at Brookings Institution.
