Since I began teaching social entrpreneurship, one of the earliest themes I establish in every course is:
"Government is not the default"
Most students have not thought about why we have government, what the role of government is and what services should government provide. How you define the role of government determines the domain of the private sector and capitalism. Within this domain of the private sector is where social entrepreneurship operates. Perhaps the larger the scale and effectiveness of social entrepreneurship, the less we need government.
A post on Cafe Hayek this morning made me realize that perhaps I need also to define capitalism for my students. Amongst the many benefits of capitalism, choice is one that does not get enough attention. This quote from Yale Brozen in the article ”The Revival of Traditional Liberalism", makes the point about choice clear and points out one inherent weakness in any government.
"The modern “liberal,” the reactionary in disguise, suspects every businessman of an intent to bilk him. On the other hand, he trusts every bureaucrat and trade union officer to look out for his interest. I, on the contrary, suspect everybody of looking out for his own interests, be he businessman, bureaucrat, union officer, consumer, Congressman, workman, or the ordinary citizen. I am somewhat willing to trust a businessman to serve me well since any attempt to bilk his customers will mean that he will lose business to competitors. This, at least, means that it is to his self-interest to serve me well.
The average politician I trust a great deal less since he is quite willing to serve my interest badly if the support he gains at my expense is crucial to his election. Besides, he can confuse the issue by offering a few items in his platform which have some appeal to offset the other things which are distasteful. In every election, I have had to choose either the grab bag of proposals offered by one party, 95 per cent of which are distasteful, or the grab bag offered by the other party, 97 per cent of which are distasteful. That is hardly a choice. At least, when I buy a General Motors automobile, I do not have to buy GM gasoline, GM schools for my children, GM garbage collection service, GM old age annuities, or GM anything else. In a free market, I can separate my decisions on what automobile I buy from my choice of what gasoline I consume, which service station I patronize, which mechanic I go to for repairs, or which company insures my car or administers the funds I save for my retirement income." (my emphasis added)