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Growing an Economy (Vol. 123)

A Little Common Sense Goes a Long Way


Innovate and Expand output of goods and services. That is how we grow.


Why am I wasting your time with such an obvious statement?


The reason is because our government may understand the words, but their actions defy common sense in fostering growth. Let me make my case.


There is a certain amount of capital in an economy at a given point in time. It isn't fixed but at a moment in time it is. How that capital is used, will determine how fast, or even if, we grow and improve our lives.


Should we even care? Of course we should, innovation and growth is what has enabled us to enjoy the standard of living we have today. Even the new entrants into the workforce or lower income folks today have more luxury and conveniences today than the kings did in the middle ages. Would you like to give up your smartphone, TV, auto, computer, even your electricity, and live in the middle ages? Not me. And for the few who might think it to be a better way of life, let them try - dollars to donuts they will come scurrying back to modern times. We don’t miss what we never had, but once you have something, you do not want to give it up.


I digress, back to my point - I am not an anarchist, there is a proper role for government, the question is how much do we NEED. It takes resources to run a government, the non-productive sector of our economy. The more government takes, the less resources that are left for saving and investment in the private sector, the productive part of our economy. Investment in new or improved productive capacity is what leads to innovation and growth, and improves our standard of living. Simple concept which is obviously true.


Ipso facto, the bigger the government, the slower we grow, innovate, and improve our standard of living. Simple, straight forward, true.


Our Federal government has become a behemoth, intruding into and trying to control our lives. Our Founding Fathers knew and understood that too much power in the federal government was toxic to our liberty and wisely designed a limited federal government with specific necessary functions for it, and the rest was left to the states or the people. So, we would be far better off if we limit the federal government and let the states, local government or the people do what is necessary to be done.


BOTTOM LINE


It is time to reimagine our Federal government, jettison the departments and programs that do not belong, fix the ones that do not work, or move some functions to a more local government. Replace programs that do not work with well designed programs that consider the ‘seen and unseen’ consequences of the program. Streamline our federal government, read the Constitution and add only the programs that modern times require.


Congress will not vote itself out of power. We, the American public, must tell them what we want. Demand it.


The formula for growth is simple:


SMALLER GOVERNMENT + LOWER TAXES + BALANCED BUDGET =

MORE INVESTMENT & FASTER GROWTH

LEARN ECONOMICS, THEN VOTE SMART

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