Why is there a distinction between working dogs and "pets"?

This occurred to me a little while a go while answering another question...why do people think that a working dog cannot be a companion animal? Why cant a properly bred companion animal not be a working dog, if the need arose?
Is it because of the deterioration of all working breeds, is it because of some sort of PC that we have such a distinction?
A dog bred true to the standard of the breed, from its country of origin, should be able to fill either purpose...your opinions??
 
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