I don't think any government is impartial, but you're right. That seems like it's the idea. In theory, it's much better to have the government be the big man on campus. You really don't want to live in a place where corporations are more powerful than the government.

This relates well with the gang model of politics, where the government is merely the biggest gang. It is an interesting way of looking at political systems because it encompasses such a range of scales.

Just make the biggest gang a democracy.