We have much to celebrate as we recently noted but we have incurred substantial opportunity costs as a country. We have missed many benefits that were easily available. Signs are that we will continue to miss benefits.
John Taylor details the lack of productivity in the US for most of this century. Some have argued it is a secular thing. We are with John and think it is a result of economic policy. To us it is a missed opportunity for the current president. All he needed was a little restraint. That, however, was not in the cards.
There has been much complaining and carrying on about our two major party candidates for president and rightly so. The opportunity lost was Mitt. If we were enjoying the reelection campaign of Mitt and Paul there would be lots of complaints (go back and check out the commentary during the Reagan years) but it would be less bitter and less comprehensive and John Tayor would have happier news.
Our thesis: sensible economic policies do not have a direct immediate effect but they change likelihoods. Thus, Taylor’s chart stops its free fall under more sensible economic policies but the ability to reach old maximums every year is questionable. What are more sensible economic policies? They would start with less regulation, less regulation, and less regulation. We realized we were redundant but it is the easy way. There are also important issues about taxes, spending, and the deficit. Reducing regulation is the easy solution as we work on the others.
The probability of Herself becoming the next president is high. Presidents are not all powerful and Herself will be less worse the the current president. Still she is a treasure trove full of bad ideas and ethical lapses. We hope for a single term.
The success of The Bernie and the revival of socialism in the US and particularly among the young is potentially the biggest opportunity cost of all as shown by his continuing impact on the Democrat platform and the positions of Herself. We should be clear to distinguish between The Bernie’s adoration of Denmark and socialism. A big welfare state like the US or Denmark is much different from a socialistic state. As Kevin Williamson correctly noted (and we have often referred to the Heritage Index of Economic Freedom):
Welfare states are welfare states and socialism is socialism, and, in spite of the Bernie Sanders gang and the Right’s talk-radio ranters, they are not the same thing. Welfare states use taxes and transfer payments to enable higher levels of consumption among certain groups, usually vulnerable ones: the poor, the sick, the elderly, children….
Socialism, as I have written at some length, is a different beast entirely. Like the welfare state, it involves the public provision of non-public goods, but it achieves this in a different way. Rather than levying taxes and distributing checks or vouchers, the socialist government owns and operates the means of production, or, in the corporatist variant, puts the means of production under political discipline effectively indistinguishable from government ownership of them.
To summarize: We are not in favor of big government but can understand its adherents. Neither are we a small government absolutist. We are OK with government being larger than two centuries ago. Socialism is different and we cannot understand those folks. They cannot be convinced that socialism is that unlucky. There are, to be realistic, a few things that fall on cusp between big government and socialism. As Kevin says, putting the means of production under political discipline is socialism. The VA is socialism (oh, and a failure). Is Obamacare? Still, there is generally a fairly clean cut line between the two. We can see the opportunity cost in China and India where years of stagnation under socialism has led to them joining the Great Enrichment. Why would the US choose to leave?