Government and Business
Introduction
Government and business enterprise operations are, in many ways, intertwined and interrelated. However, the argument is still rife as to whether the two can be separated when it comes to economic matters. They work closely together to meet specific objectives based on the laid down procedures in a given country. Today’s global economy is no doubt run by entrepreneurs and business people acting as the driving force behind economic growth. The phenomenon under discussion will paint a picture of the relationship that exists between Britain’s government and multinational businesses using Gibb’s reflective cycle theory. After that, the theoretical essay will examine a contemplative learning experience in the module, emphasizing the roles government and business play both in a state and the benefits of a peaceful union, specifically in Britain and the European Union. Later, a candid role of citizens in shaping this union will be discussed in depth.
Question A: Government and Business Relations: Gibbs Reflective Cycle Theory
Descriptions and feelings- Generally, the main objective of any business set up is to make a profit. Conversely, the government’s goal is posited to ensuring that there are economic growth and stability. The role played by the two may seem to be different; however, they are very co-dependent, their influence and persuasion towards each other, having a significant magnitude (Clift, 2014). That notwithstanding, it is paramount to note that the relations between both are not always rosy. Political pundits allude this fact to capitalism and communism exhibited by various nations across the world. In capitalism, the economic system is managed by an elite group whose aim is to control resources and amass wealth. For example, most Asian countries like china exhibit this governance trend.
On the other hand, communism entails government effort to take control of the economic systems by ensuring that it’s sustainable. Most democratic nations like European nations like Britain and the U.S. possess this ideology. A dilemma still suffices regarding the rules set by the government of the day and the stakeholders. Usually, businesses find themselves engaging with the government in the setting of regulations governing their operations. However, political experts have a feeling that the government is seen as the primary stakeholder and not a mere partner since it takes all the credit for regulating, deregulating, and making land policies.
Consequently, affecting business organizations. Stringent and hard measures by the government can, however, act as a threat to the business owners. They are hence tempted to move territories. Notably, there exist three periods through which governments and businesses have related over time.
Firstly, from 1945 to 1979, the confrontational phase came into play. There was a significant increase in post-war multinational enterprises (MNEs) and the FDIs (Furner, Balleisen, and Moss (2010). Host countries were required to confront and regulate this rise, using all mechanisms. Consequently, the move posed a threat to the MNEs and misunderstanding between the governments and the business firms, thereby losing national interest. Political parties and hard stance also played a vital role during this period. For example, in the Britain administration era between 1945 and 1951, Clement Attlee of the Labour party introduced policies that focused on nationalism, a welfare state, and re-building of the economy (Clift, 2014). In 1980-2000, the accommodation era surfaced. Here, there was a shift from confrontational operations to cooperation between host nations and businesses. Besides, there was room for the open economy from previous regulations, movement from opposition to partnership, taxing to subsidizing, and free good freights from one region to another. The new era emphasized classical economic concepts that focused on open systems. It advocated for minimal interference in the free market settings where the supply and demand for products meet at equilibrium when kept constant.
Secondly, the Conservative party in Britain led by Baroness Margaret Thatcher demonstrated this concept from 1979 to 1990. She encouraged privatization, leading to a sharp departure from the nationalization state of the economic system (Cocker and Jones, 2015). Furthermore, she advocated for supply-side policies and deregulation of stringent business operations. Also, she embraced big on tax cuts at the upper end of the business scale. Thirdly, in the wake of a new millennium 2001, there arose many supranational bodies, private- private entities, MNEs growth in many developing states, and non- governmental organizations. According to Cocker and Jones (2015), Tony Blair’s government era from 1997 to 2007 engineered these changes. He continued with similar policies thatcher had introduced, later on, emphasized more on addressing poverty and unemployment rates in Britain. He was more of Euro-crazy than his predecessor, who acted Eurosceptic besides over sighting over the National Minimum Wage Act, 1998.
Evaluation and Analysis-The good relationship earlier portrayed by governments over businesses sometimes begin dwindling. This is made possible thanks to post-war recoveries and financial crisis eras, recessions, the introduction of new government policies, and lousy party politics. In the end, they influence the relationship; therefore, forcing the businesses to comply with the onerous regulations imposed. The government, on the other hand, feels entitled to implement policies governing operations since it owns the territory location of the business. A worsening situation may bound to happen. For example, from 2000, the business circles in Britain began viewing the government as an enemy of economic development. Clark et al., (2017) assert that in June 2016 in the U K wide referendum was instigated known as Brexit. The move saw Britain formally withdraw from the European Union (E.U.) with a resounding 52% victory vote from the proponents (Clarke et al, 2017). The process of leaving the union sparked a lot of concern, especially with the existence of bad blood between the union and the United Kingdom (U.K.). Hard Eurosceptic advocated for the withdrawal while the E.U. law was binding regardless of how stringent they were to some member states. Clarke eta (2017) suggested that the witnessed financial fall in 2007-2008 was an implication of how the E U market must remain stable even in times of war and recession. That proved impractical to the British government. Since its exit, there is drastic fall in credit –boom since 2019 coupled with high public sector, over 80% (Rhodes, Heywood and Wright, 2016). The exchange rate between sterling and dollar has also dropped in equal measure with U.K. sector activities losing momentum by July 2018.
Conclusion– Brexit has resulted in increased tension between businesses in Britain and the government, hence raising uncertainty for its withdrawal. The Eurosceptics regard foreign firms as entities doing business for E U members, thereby exhibiting capitalism.
Action plan- Business organizations should follow the government’s laws so that they can operate their errands with ease. Conversely, the government should ensure steady economic growth by providing liberal and protection of businesses. Also, the government should be able to protect its business investors from external punitive policies, which could pose a threat to them and eventually force them to exit the marketing stage. U K withdrawal from the E U is a perfect example.
Question B (I) Roles of Both the Government and Business in a State and the Benefits of a Peaceful Union
The union between the government and business likened by a couple in marriage as a metaphor showing the extend of mutual benefits found in this peaceful engagement. Yet each plays a specific and integral role with cooperating power. Both may have different approaches with varied ideologies towards a particular subject but still engage each other to come up with a universal agreement. First, the government’s role in a state is basically to attempt to shape how the business carries out its practices. It does this by involving itself directly or indirectly, implementing rules and regulations. The government directly influences the establishment of laws and regulations that dictate how business is run. Therefore to implement legislation, monitor, and control certain business activities, the government creates exclusive agencies to function on its behalf. For example, the E U controls and influences member states on trade and governance. It is hence protecting them from external interference. Secondly, the government’s role is to provide the necessary judicial system devoid of any biased judgment, helping to settle business disputes. The post-war era in Britain during the 1950s and 1960s witnesses arise in Keynesian politics (Rhodes, Heywood, and Wright, 2016). The government injected more funding in public services to increase demand, thus pulling the economy out of recession. It was called communism. Britain’s ideology eventually became a welfare concern. The role of the business in a state is not necessary to capitalize on the government’s political stability but contribute to the social care basket program. The following are the principal roles businesses (Moran, 2015):
- Regular remittance of taxes- the uses the monies collected in providing the following policing, fire, education, judicial systems among others
- Provision of voluntary programs such as cultural growth, greening businesses and sponsoring welfare programs
- They provide relevant information to the government, giving feedback on leaders’ political decisions and contributing to the subject
matter where necessary. The corporate power and the state not only benefits the host country but the whole global chains. The operations of global social media enterprises like Facebook, Apple, and Google, among others, generate massive economic power and financial benefits (Guay, 2014). Consequently, bringing uniformity in business operations resulting in peaceful unions. To bring political tranquility unions such as the E U brings together all the European nation members to jointly benefit from the association. Globalization, on the other hand, integrates market technologies and nation-states to extend that they can enable individuals corporates and nations to reach more extensive business grounds. This is done quicker, cheaper, and more profound like never before. The owners of such companies are therefore invited by international bodies like E.U. to formulate joint policies. Hence the state benefits from peaceful collaborations with varied new skills from these companies.
(II) Role Played by Citizens in Shaping this Union
Undoubtedly, Citizens of any given state happen to be the sole beneficiaries of a peaceful deal truck between the government and the business firms. Yet they have a crucial role to play to continue enjoying these benefits. For example, Britain is a democratic state; therefore, it exhibits communism in its ruling strategy (Clarke et al, 2017). Citizens form part and parcel of economic development on all fronts. They have desires to satisfy, like investing in the government’s economy; they possess properties that would need to be protected. With all these roles at their disposal, they feel they are members of the state hence equal to the lords and commons of parliaments.
Civil servants play a vital task in championing development dialogue in the state. The group brings together communities that articulate voices and demands that are a concern to society. Upon receivership of the grievances, they are escalated to the local, regional, national, and international levels for action. It is only made possible when there is peace between the government and businesses their influence in society on a larger scale.
Besides, people ensure they vote in individuals with political parties fighting for all rights. Moran, (2015) explains that Britain’s political evolution from the early 19th century to date indicates the role they have played in unifying the country. From the labor party during Clement Attlee to Thatcher’s and Tony Blair’s conservative political alignment, the citizens have taken advantage of the peaceful tranquility in the nation to contribute to a political revolution in the U K.
Also, they take part in paying taxes to the government. Today, the British government is fighting corporates like Amazon and Apple, who allegedly evade paying taxes (Guay, 2014). Individuals who also abscond paying taxes are on the government’s redder. Upon remittance of these taxes, the government and businesses get revenue through taking loans from the financial institutions hence engaging in the peaceful mission of economic development.
Conclusion
The relationship born out of the government and business is vital not only for the development purposes and delivery of public services in Britain but also for the successful business operations. The paper has given the approach using the Gibbs Reflective cycle theory to examine the nature of this relationship. Britain’s economic system has mostly been affected by the massive evolution of political system staging from the 19th century. Hopefully, the post Brexit developments will sharpen business operations under Boris Johnson in the next few years to come. Besides, the phenomenon has looked at the roles and benefits accrued from the two elements in peacefully keeping of the nation, especially in Europe union and global context. Finally, the phenomenon has highlighted the role played citizens in shaping the alliance between the business associations and the government.
References
Clarke, H.D., Goodwin, M.J., Goodwin, M., and Whiteley, P., 2017. Brexit. Cambridge University Press.
Clift, B., 2014. Comparative political economy: States, Markets, and global capitalism. Macmillan International Higher Education.
Cocker, P.G., and Jones, A., 2015. Contemporary British politics and government. Cambridge Academic.
Furner, M.O., Balleisen, E.J., and Moss, D., 2010. From ‘state interference’ to the ‘return to the market’: The rhetoric of economic regulation from the old gilded age to the new. Government and Markets: Toward a new theory of regulation.
Guay, T.R., 2014. The Business Environment of Europe: Firms, Governments, and Institutions. Cambridge University Press.
Moran, M., 2015. Politics and Governance in the U.K. Macmillan International Higher Education.
Rhodes, M., Heywood, P. and Wright, V. eds., 2016. Developments in West European Politics. Macmillan International Higher Education.