People have been very hard on Obama about the economy. I am not asking if he or Congress did the right things. Those are topics for another thread. What I am asking is, is it really up to the government? The crash occurred because of reckless lending practices by privately owned banks. The recovery was spearheaded by booms in the oil and technology industries. The meteoric rise of companies like Facebook, and the shale oil boom in North Dakota weren’t really the government’s doing.
Both are obviously very important. But while it’s possible to have a crude, inefficient economy without a private sector, it isn’t possible to have any economy at all without the government. So I’m going to say the government is more important.
Define “important.”
The private sector operates within a framework established by the government, so from that point of view, obviously the government is essential.
However, the private sector is much larger than all the government spending put together, so from that point of view, the private sector is more important.
Are you sure?
Trade has occurred in the wild so to speak.
But with regards to the OP, the free market’s fundamental nature with pricing as a feedback mechanism leads to more efficiency in matching supply to demand. Government doesn’t have the luxury of efficient feedback mechanisms. Even in a democracy or a republic people are still irrational enough to knowingly vote for inefficient policy.
That said, government can provide stability and forceful adjudication that can mitigate cheats and fraudsters. Of course cheats and fraudsters then maneuver and take the levers of power but that’s why we have checks and balances in theory.
Where we get maximum productivity is when we have each actor doing their appropriate role.
Which is more important, the big engine under the hood…or the emergency brake?
Government creates very little wealth; all it mostly does is redistribute what has been created in the private sector. Without private enterprise, there would be very little wealth to redistribute. But the government does provide an essential service, to protect its citizens from force and fraud. This raises the question of who protects us when we’re victims of the government’s force and fraud.
Government or private sector? Yes.
(IOW, both are important, pretty much equally dependent on each other. Without the private sector there is no money to pay for the things a functional society needs. Without the government it’s chaos and the private sector can’t function to make the golden eggs society needs. Anyone saying that one is more important than the other is trying to assert that it’s the hydrogen that’s REALLY important in the water, while that oxygen stuff is totally unnecessary or at least not as important. After all, they call it H2 O after all :p)
I was pleased to see that even a few right-wingish Dopers were capable of nuanced views on a topic phrased to bring out the Libertarian dingbats! Perhaps the board’s anti-government nuts are in a different time-zone. 
The government has built many highways, dams and bridges. Government funds led to the development of the Internet and much pure science. Et cetera. Would you like to rephrase your answer?
We are very open with our financials with our children even though the children aren’t even teens yet. We also have age appropriate political discussions. One example that would seem unusual coming from someone who does lean libertarian was defending local sales tax when the kids were disappointed that a $20 book cost more than $20.
I had to ask them questions like do you like this road? Do you like that stop light? How about street lights? Police on the corner? School you go to? I had to shower afterwards.
…which of course you’ll start. 
Private sector, no question, although it’s kinda like asking if a pitcher is more important to a team than an umpire. As an earlier poster said, without a government you can’t have much of a private sector, but the private sector does all the real work. The government sets the ground rules. Having government do too much is kinda like winning games with paid off umpires. Or at least umpires that definitely prefer a certain team to win. But all of the real action and innovation is by the players.
No. These examples are very little, compared to the enormous wealth of the total economy, created by the private sector. And these examples would have been created anyway, without the government’s help, at a lesser expense.
As panache45 correctly stated, government doesn’t create wealth, it redistributes it. Highways, dams, bridges, science projects, etc., are some of the ways government redistributes it. Where do you think those “government funds” come from if not from those engaged in free enterprise?
I agree about innovations, but public works, like roads, wouldn’t, or at least not well. Take a city like Shepherdsville, KY, which is growing ultra fast due to being close to a UPS hub and the growth of the internet. Tons of warehouses there, starting with Amazon. But no public transit, it’s not walkable, and even the roads aren’t great.
The city is still acting like it’s a sleepy little town rather than building up the infrastructure. And the companies there aren’t stepping up either, because why should they shell out millions to pay for stuff the other companies in the area can benefit from? That’s why governments do things like mass transit, roads, and sidewalks.
These comments are bizarrely wrong on multiple grounds. Let me help you step by step.
-
*“very little.” * Was the Interstate Highway System little? How about the Apollo moon-landing program? This comment by panache45 was so supremely wrong, he’ll find some other basis to quibble than size or wealth. For example, he may claim that the Moon landing lacked value in a way that privately-created sports events do not; that if the Moon landing has any entertainment value … Ah, I’ll just let panache45 hoist his own petard.
-
“would have been created anyway.” So, without government we’d have gotten our highways? Sooner and better, I suppose? And if only the U.S.A. were a libertarian anarchy in 1941, the forces of free enterprise would have defeated Hitler sooner and better? I’m sorry — I just can’t refute you, panache45 — whenever I contemplate your claim I just burst out laughing.
-
“doesn’t create wealth” Perhaps we need to start with a definition of wealth. I guess, according to Mr. Artist, infrastructure like pipelines and wires built by private companies are “wealth” but highways built by the government are not?
“redistributes it” When an employee of Pepsico buys an iPhone, money is being transferred, in steps, from Pepsi to Apple. What else is new?
“Where do you think those government funds come from if not from those engaged in free enterprise?” And Apple’s money comes from Pepsi. And Pepsi gets revenue by selling soft drinks to government employees.
I could go on, demonstrating the absurdity of these under-informed complaints. But it seems more generous to first give anti-government nuts a chance to improve their “arguments.”
You don’t have to be anti-government to know that the private sector is the engine of any economy. Even the commies figured that one out.
The private sector usually does a better job of creating wealth than the government (and creating wealth is usually not the purpose of government action), but it’s ludicrous to make sweeping claims like government can’t create wealth. The internet wasn’t just redistribution – it was multiplication, just like other infrastructure.
This is where actually telling the truth can help. One thing government generates is bullshit by the truckload. Stop calling all spending “investments” just because it polls better than “spending”. Some government spending does generate a return on investment. Most of it does not.
But you’re right, government isn’t designed to make profits. It’s purpose is to provide public goods.
In conventional economic theory, this is literally impossible, because “rational” is defined to be what people do. Or, if you’re redefining your terms (I can’t blame you, because that definition of “rational” isn’t nearly as useful as economists like to pretend), then you need to establish that peoples’ buying decisions aren’t similarly irrational.
And governments and private industry generate wealth in exactly the same ways, much of which (in both cases) is just redistribution (or as it’s more commonly called, trade). The main reason that government produces less wealth than private industry is simply that government is smaller. If you want to talk innovation, though, the government is still responsible for at least as much innovation as the private sector is, despite being smaller. Most fundamental research is funded by governments, not by companies.
Companies turn that basic research into things that actually work. The Soviets did a lot of research too, and also tried to produce end products. It was a joke.
The government also isn’t better at research, the government is just willing to fund research that may not have economic value. The private sector is where innovative ideas to use new knowledge are developed.