Why Business Needs Government

James Gustave Speth

June 15, 2005

James Gustave Speth is Dean of the Yale University School of Forestry and Environmental Studies, and author of Red Sky at Morning: America and the Crisis of the Global Environment. This article appears originally in the July/August issue of World Watch magazine, released today.

When Ronald Reagan famously said that "Government isn't the solution to our problems; government is the problem," many in business cheered. But what if Reagan had it wrong? What if business is shackled by forces far more powerful than government and, in fact, needs government to free it to do the job it increasingly knows must be done?

Business leaders know better than anyone that they are trapped in a system, constantly hemmed in by imperatives shaped by market competition, consumer preferences, investor behavior and other factors. These imperatives often preclude attractive options. When the gap between the required answer and the right answer gets too wide, government action to provide new norms and rules of the road becomes imperative.