Government Should Make Consumer Goods

We should have government designed consumer goods. Let me explain why and first dispel the first negative reactions:

I am not talking about having ONLY government consumer goods. Private consumer goods would still exist.

But why? Isn’t the government bad at everything? The idea that government is bad at running things is just myth. We have countless examples of well run government companies. Swiss railway is probably the best railways in the world. Government run. Norwegian oil company Equinor is state run. I don’t think anyone can claim Norwegian oil industry is badly run. We have a big success story there. I could go on about other companies but that would derail a post I want to keep short.

But isn’t the private sector doing well enough? Who needs government? The point is not a full replacement but a health alternative. Today products are made in a for profit market. That created perverse incentives.

Private companies are not seeking to make the best products for you. They are seeking to make the most profits.

If they made a perfect product that never broke down or could easily be fixed and upgraded, then their sales for tank. That is not in their interest. They want as high sales as possible and they want lock-in. They don’t want you to use other vendors.

Thus they make products that cannot be fixed or cost a fortune to fix. They make printers that seem cheap until you try to buy ink. They make clothing fashion that changes every few months to make you constantly buy clothes.

This is bad for the environment and it is bad for you. What if there was an alternative? That cannot come from the private sector, because anyone making durable and repairable products will get low profits and get outcompeted.

In other words we need companies designing, making and selling products that is not rated and evaluated on their profits and maximizing sales but rather on customer satisfaction and environmental impact.

This idea was inspired by the Norwegian liquor monopoly because they by law are not allowed to target maximized sales. So what does a CEO do then to rate his success? He uses customer satisfaction as the metric. The result was that a state monopoly gained the highest customer satisfaction of any company in Norway. Think about that. That shows the potential for government run enterprises that do not have maximum sales and profits as their goal but maximum customer satisfaction.

In other words the focus will not be on how to trick customers into buying your products but how to make sure that once they bought your product they are really happy with it.

Government should be able to run ads, but those should have clear restrictions:

1. Emotionally manipulating consumers into buying something they don’t need should not be allowed.

2. No overpromising and under-delivery.

Instead ads should be required for focus on facts. What the product is good for and what it is bad for. Government ads should be required to be honest and list not just benefits but also disadvantages so that customers are not tricked into buying something. Customers should have a clear idea what they are getting.

Regular customer satisfaction surveys should be run, with occasional in depth interviews with customers to figure out what they like and don’t like. That should influence product development. Not sales charts.

If the private sector already sells a high quality durable product, which are environmentally friendly and which everyone is happy with then the government should not waste resources getting into that sector. Focus should be in areas where there is a high cycling rate of products. A lot of waste. Short lifespan and customer dissatisfaction.

Government designed products should avoid lock-in as far as possible. Remember the goal is not maximized sales but reduced overall consumption combined with great customer satisfaction and small environmental impact. Thus it should be easy for the private sector to make compatible products. In fact government designed products should ideally be open source. Much of the specifications open so private companies can create compatible alternatives if they wish to. Or simply ad-on products.

To give some examples. A government designed printer should allow for ink cartridges from competitors. Killing the competition is not the goal.

Any repair shop should be allowed to fix government made products. No special vendor lock-in repair shops.

A government phone should not use proprietary cables, but stick to well established universal standards.

Because profits and sales will not be the primary goal, government consumer goods corporations will not be able to demonstrate high profits and income. That means they will be susceptible to attacks by capitalists who will argue they are badly run, because they are not demonstrating high profits and sales.

The point here is that we are trying to escape capitalist logic that equates profits with value. The value of these government designed products would be a smaller environmental impact and happier customers.

It is also about creating better mental health where we stop focusing on consuming ever more as a way of getting happy but instead simply have the product we truly need and start focusing on the rest of our lives.

There may not be profits in that, but there is very clear value in that. Citizens are going to be willing to pay for that benefit but that benefit cannot be captured at the point of sale.

This is similar to my argument about the benefits of a subway. They will never be very profitable because most of the people who benefit economically from a subway are not paying the tickets. Wait, how can people not riding the subway benefit from it?

Let me clarify. Subways move a huge number of people in relatively small space. Every load of people moved with a subway is cars off the highway. That means people driving on the roads get less congestion. In other words subways are a big benefit to drives, but drivers never pay a ticket. They never reward the subway company for the benefit they bring drivers.

Likewise subways remove the need for massive amount of land allocated to parking. That means countless restaurants, shops, and housing will exist in prime location thanks to subways. But none of them paid the subway company for that advantage.

Hopefully you start to get the point I am trying to convey. It is that so much value is created in ways which cannot be captured directly through point sales. Value can often be very indirect. So how do we pay for these advantages? The simplest solution is taxes. Alternatively there is a small tax on motorists, property, parking etc that is transferred to subway, tram and bus companies. My point is not to sell you on one specific compensation method but rather acknowledge that corporations should not have to demonstrate direct profit from sales to prove that they are a value to society.

And if they are a value to society we should find ways of compensating them outside the market. One way is taxes, but whatever works.

Let us just brainstorm some ideas which could allow for government run companies to get funded in a way that is fair with respect to the value they contribute to society.

We could run statistics on say citizens having a government printer and compare with people buying commercial capitalist printers. Look at how much money those buying non-government printers spend over say 5 years. Spare parts, ink, repairs that screw over people will add up. That excess cost relative to government sold printers should represent cost savings that the government corporations should be financially rewarded for.

We could look at the same for say clothes. If people buy 5 commercial jackets over the course of 5 years but only need 1 government designed jacket then that is 4 jackets that never had to be bought. The cost of those jackets got saved.

So let us think a bit hypothetical. If citizens safe $500 per year due to government designed products relative to buying commercial products then paying say $100 in taxes to go to funding government design and manufacturing of public goods would make economic sense. Citizens are still better off economically.

You can already see why the economic calculations are more complex. We are basically trying to figure out the value of sales not made. Traditional capitalist thinking is implying that higher consumption equal more benefit or happiness.

Government products can benefit people who are not buying government products, because they can provide a benchmark for what is possible. Consumers will start holding private companies accountable asking them why their products cannot be repaired or are not durable. It will be hard for private companies to make excuses because consumer can point to actual government designed products which lasts and is repairable.

I don’t think something like Soviet style products should be the goal as those were often overall gray and functional. Ignoring human psychology entirely. Good looking products may seem frivolous but mattes. Human welfare is affected by being surrounded by products and designs that are pleasing to us.

In other words government design should not merely seek to be functional but also look pleasing to the consumer. But the focus should be on making the owner pleased not in terms of tricking people into buying it or overly manipulate the emotional need for something they don’t need just because it looks pretty.

This is perfectly possible. In Norway we have government run TV channel NRK. They make a lot of nice things. It is easy to think Soviets represents what government do, but we forget that was a poor country and a dictatorship. In a democracy that cares to serve its citizens it is absolutely possible for government to create quality products that serve its citizens needs.

What is important to understand about this whole idea is that it is primarily about government led design. It is about creating products fit for long usage and satisfaction for customers. It is not a particular requirement for government manufacturing.

In other words this could in theory be done just as how Apple makes iPhones. The government does the design and R&D but a factory in China actually produces it.

And we could have many interesting combinations here. E.g. the bulk of the production could be in China or a similar low cost country while a strategic lower volume of the same product is made locally in case foreign imports is hurt due to war or crisis.

The biggest obstacle is probably that people are so brainwashed into thinking government cannot do anything well. The second obstacle is to dominant Neoliberal ideology which makes it hard to establish production and product design based on anything but capitalist competition without hitting free trade rule violations.

Free trade rules have often tied our hands and feet to a Neoliberal capitalist economic and social model whether we want to or not.

My take is to try to get people to challenge that idea. To challenge the whole neoliberal project.