Why Government Fingers in Business Generally are a Disaster

Andrew S.Grove, the former CEO of Intel, recently made some points in the Wall Street Journal, statements that should be mulled over. They have a somewhat different slant than the public may have of business success.

What would have happened to the PC industry if IBM were taken over by Uncle Sam prior to the PC revolution, as the American auto industry is being revamped today?

The government wants GM and Chrysler to remain as they have been all along, making its products vertically. That is, a company makes its final auto in all its stages, to the final retail consumer sale.

The computer industry changed with the advent of the PC. It became horizontal, with some producers manufacturing hardware, and others adding their specialties that made the final product.

Had the government interfered back in the 1980’s, the PC revolution probably would not have occurred. The government hacks then might have insisted that PCs be made entirely by the same outfit, particularly one that may have been struggling (and many did).