How to Run a Successful Business: Send Out a Survey Every 10 Years

Imagine all of a sudden in your neighborhood a man standing outside a recently vacated building began handing out a survey. This survey contained the following question: If we dont know how many people live in this neighborhood, how do we know how many sandwiches we need? It then asked for you to write in how many people live with you. Here are some of the questions that, in turn, would probably pop into your head:

1. Why hasn't any other successful business in the neighborhood sent out a similar survey?

2. What does the number of people in the neighborhood have to do with how many sandwiches this apparent-future-sandwich-maker should make? If they are cheap, won't more people buy them, probably even from neighboring towns, and if they are expensive then fewer people will buy them? Why a survey with one question meant to provide an answer to something that is contingent on so many other factors?

3. Shouldn't the sandwich-maker be determining how many sandwiches to make as he goes along? Isn't it better to decide to make more sandwiches if after the first few rounds they all sell out quickly giving the sandwich-maker a big profit? Or to make fewer sandwiches if the opposite happens?

I bring up this anecdote because on my way home today, I saw an advertisement for the U.S. Census on the subway that said, "If we don't know how many people we have, how do we know how many trains we need?" I actually could not think of a more beautifully absurd example of why the subway system should not be run by government.

If the individuals who run the subway system are determining how many trains they need based on the census, there should be no surprise as to why the subway system is a loss-producing venture, in every single year of its existence. Literally.

A more reasonable method of determining output would of course be a profit and loss mechanism. But wait! Since the subway system is run by the government, there is no such thing as a profit and loss mechanism. That is precisely why they need to do the equivalent of "feeling around in the dark" by asking how many people there are in the area. If the subway system actually reacted, in the way a business would, to the fact that it produces losses year after year, it would have shut down long ago. In fact, a private investor or company would probably have bought the subway system and would be running it the way your local sandwich shop is run: keep operating as long as you make a profit (which means you are satiating customer needs) and innovate to try to make more profit (further satiate customer needs).

It is truly a testament to the capabilities of government agencies that they produced an advertisement like this which better than anything else displays ineptitude at its greatest.