Politicians often gab about the “private sector” and the “public sector,” as if these two categories of economic activity operated as two completely separate worlds.
In reality, these two sectors have always been deeply intertwined.
How deeply? Every year, the federal government spends about half a trillion dollars buying goods and services from the private sector. State and local government contracts with private-sector enterprises add hundreds of billions more.
And private-sector companies don’t just receive contracts from our governmental entities. They receive all sorts of subsidies — billions upon billions of dollars in “corporate welfare.”
Where do all these dollars come from? They come from us, America’s taxpayers. Without the tax dollars we provide, almost every major corporation in the United States would flounder. Some would simply cease to exist. The defense contractor Lockheed Martin, for instance, takes in almost all its revenue from government contracts.
This private sector reliance on public tax dollars gives us, as citizens, some leverage over the behavior of our largest and most powerful corporations. We could, if we so chose, deny those dollars to corporations that engage in behaviors that undermine the values we hold dear.