IN LAUNCHING his drive for private voluntary activity last week, President Reagan noted that while pure philanthropy can be relied on to fill part of the gap left by declining federal aid, enlisting the whole-hearted support of industry requires solid financial incentives. "We are also," he said, "talking about a buck for business if it helps to solve our social ills."
That's a sensible start for understanding the lackluster response to earlier presidential calls for public-private partnerships as well as the limits on expectations for the new initiative. Private business can, and does, help meet social goals in several ways. Corporate giving is a good form of institutional advertising, so it won't disappear--even now that much lower corporate taxes mean the businessman will be paying for most of it out of his own pocket rather than the Treasury's. Too much pressure on corporations to meet local needs, however, could send even more of them in search of areas where needs--or at least levels of concern--are low.
Business, however, can also help out by improving the efficiency of services ranging from garbage and debt collection to hospital care. Sometimes this works out well and sometimes it leads to the sort of egregious rip-offs that surface in every investigation of Medicare or defense fraud. The key to success here is making sure that "privatization" of services is accompanied by more sophisticated and active government monitoring and audit activities.
The most obvious area for business involvement, perhaps, is in combating the large--and, by some measures, growing--problem of hard-core unemployment. The National Alliance for Business, which the president chose for his address last week, was set up at the urging of President Lyndon Johnson for this very purpose. Why has progress in this area been so modest? The main reason is the one that President Reagan implicitly noted. Business is, after all, in business. If an activity doesn't pay off in profits, a company will --and should--lose interest in it. Making a profit isn't necessarily inconsistent with social goals. Companies need a competent labor force, for example, and insisting that they reach out to all segments of the community--including minorities and other disadvantaged workers--can tap skills and resources that might otherwise be overlooked.
What won't work--and hasn't worked over a decade of trying--is attempting to subsidize employers with wage rebates of one kind or another to hire workers who they suspect won't deliver. Wage subsidies don't work because a bad worker incurs costs much larger than his tax-deductible wage--fringe benefits, lost productivity, bad feelings among other workers and customers and maybe even a lawsuit on your hands if you try to fire him.
What can work is an all-out effort to see that all the nation's youths have the basic skills and work habits--and the opportunities--to convince an employer to give them a first good chance. This is primarily the responsibility of schools and families and, if these fail, specialized job and training programs. Businessmen can help in these efforts by becoming involved in school programs--including those in inner cities as well as the ones in their back yards--to make sure that students learn what employers want. But there are clear limits to what should be expected. You can ask business to shoulder the burden of social needs or you can ask it to improve productivity and economic growth. But it is not reasonable to ask both.