A couple of good pieces highlight the mess the U.S. is in, and what to do about it.
Conrad Black notes the burdens of red tape. It’s not just an annoyance, it’s a drag on the economy, which, obviously, can’t afford any drag:
“The compliance industry — the vast proliferation of American lawyers, laws, regulations, and legal billing that already consumes 10 percent of GDP, about $1.5 trillion a year — accelerates constantly through the self-serving antics of the legal cartel in all legislative and regulatory entities. …. tens of millions of the country’s most talented people are working as consultants, learned professionals, brokers, traders, and ostensible facilitators, and thus are adding no value; they are qualitatively almost indistinguishable from the 400,000 troops and agents who collected the salt tax in France at the onset of the French Revolution in 1789. Though they don’t add any value, they impose a burden, much like a tax, on the efforts of those who do. This stifles the only kind of economic recovery that will be durable: increases in productivity that add value to extracted resources and finished goods.”
He goes on to note a devastating column in the Wall Street Journal this week by George Schultz and four co-authors that offers the solution: “The fixes are blindingly obvious. Economic theory, empirical studies and historical experience teach that the solutions are the lowest possible tax rates on the broadest base, sufficient to fund the necessary functions of government on balance over the business cycle; sound monetary policy; trade liberalization; spending control and entitlement reform; and regulatory, litigation and education reform.”