A Meeting of the Minds

Business and government partner

Orginally published in the Spring 2008 issue of the Kennedy School Bulletin.

On a cold January night in 1983, Professors Richard Neustadt, Thomas Schelling, Al Carnesale, Winthrop Knowlton, and Graham Allison gathered for dinner. The food for thought: the central intellectual question of the Center for Business and Government, founded the year before.

As Knowlton, the Center’s first director recalls: “We were asking, how do we want the business-government relationship to change? Do we want them to be partners?”

Business, says Knowlton, has emerged as a global force. For evidence he points out that one has to look no further than Walmart’s ability to mobilize supplies to flood victims during Hurricane Katrina. “We are in a state of some denial about the failures of the public sector,” says Knowlton. But does the rise of the private sector “redress the growing imbalances between efficiency and equity?"

Professor Roger Porter, director of the center from 1998 to 2001, believes the United States has made some progress toward bridging the gulf between the two sectors. “We have had a remarkable run of economic growth in the United States in the last 25 years,” says Porter, due in part to a less adversarial relationship between the two sectors.

Addressing the needs of business, government has “attended to producing smarter and less burdensome regulation and…has been quite responsible in handling the macroeconomic measures such as inflation and unemployment, to create an environment so business can flourish.” And, adds Porter, business has been responsive to the needs of society in meeting social objectives such as health, safety, and a cleaner environment.

For the past two and a half decades, the intersection of the business-government relationship has been the business of the center, renamed the Mossavar-Rahmani Center for Business and Government in 2005. The tension in balancing regulation and free market innovation was the focus of the center’s anniversary conference, “New Directions in Regulatory Policy,” last October.

More than 100 experts explored regulatory policy in a number of sectors, including the environment, financial services, health care, and energy. The conference featured keynote addresses by two top regulators: Mark McClellan MPA 1991, former Medicare administrator and FDA chief; and current SEC Chairman Christopher Cox, who spoke at the first endowed Glauber Lecture.

“The balance between business and government has shifted back and forth in recent decades,” notes Professor John Ruggie, the center’s outgoing director. “We’ve got to get over an either-or mentality if we are to deal with pressing social challenges at home and abroad. Each sector has indispensable roles to play that it cannot — and must not — relegate to the other. Our aim at the center is to define those roles and to suggest the best means of putting them into practice.”

Regulation is not the only place where business and government intersect and over twenty-five years, important new initiatives and programs have been launched, such as the Corporate Social Responsibility Initiative , Energy Policy Programs, the Harvard Environmental Economics Program, the Education Program and the Weil Program on Collaborative Governance, among others.

As Harvard Kennedy School and Harvard Business School launch their first joint degree program in fall 2008, many students will have careers spanning both sectors. The work of the center and of these students will create public value at the nexus of the public and private sectors. In an economy that is faster, more high-tech, and more global than 25 years ago, says, Ruggie, maximizing the synergies of the business-government relationship is more critical than ever before.

For additional information go to www.hks.harvard.edu/m-rcbg/25thanniversary.htm.