People moan about the economy, yet they never seem to look deep enough to see the true problem. There is something seriously wrong with our economy, but few put their finger on it. What is the problem? Do you really want to know? Are you seriously willing to take the "Red Pill"?
Today, I worked one of the largest Independence Day parades in the Midwest getting signatures for Gary Johnson for President. Are you thinking of Chicago? If you are, then you will be wrong! I was working a parade in Racine, Wisconsin. Racine has less the 90,000 people, yet they have a huge parade.
I will pose a question for you? Why does Racine have so many people clamoring to participate? Well, I will give you a hint right here:
You will notice that you only need to put in a nominal fee to participate. If you are a simple person wishing enter, it is only 25 bucks. Even a commercial entrant only needs to pay 150 bucks. Simply, there is a very low bar of entry into the Racine Parade. You do not need to have a $50,000 float or exclusive contacts with the parade committee. When it comes down to it, they just want you there.
When you contrast that to many parades where you must pass a committee or have little commercial interest, it is clear that having an open door makes for a dynamic parade. A parade so dynamic that they have about 100,000 people showing up to watch it. A parade that was one of the 10 great places to celebrate the 4th of July in 2008, accordingly to USA Today!
Now, I will direct your attention to our economy. We have the highest corporate taxes in the world. We have the most complicated corporate regulations in the world (Dodd-Frank). We have the IRS which will consider you guilty until proven innocent. We have 134,723 pages in 201 volumes of federal regulations (according to about.com). I feel it is no accident that the US economy doesn't shine. We have done the exact opposite of the Racine Independence Day Parade. We have created an entry barrier to entrepreneurs that is downright toxic.
If we truly wish to have a booming economy, then we must get our government out of the way. I can hear it now, that regulations make us safer. That is fundamentally untrue. Sarbane-Oxley did not prevent Bernie Madoff. That is as unspectacular as drunk driving laws not keeping drunks off the road. Those which would change their behavior easily would only need a Public Service Announcement, while the incorrigible will break the law with impunity. The real threat with tough regulations is that people tend to feel drunks are under control along with the financial sector's thieves. Government actually creates the environment that provides cover to those who pose a threat to society.
The only thing tough regulation provides successfully is nearly boundless amounts of expensive paper work to businesses along with very costly fines with they fail to "jump the hoops" just right. So, honest companies need to pay a lot of money upfront and eventually more when the do not "mind their federal Ps and Qs". The true criminals just do whatever they do anyway. Ultimately, we have an economy where those who create real value are punished while the thieves get excellent "federal cover" as long as their paperwork looks good to the regulators.
So, if you wish to have a booming economy, then the entry into that economy for entrepreneurs must be low and reasonable. Otherwise, we will continue to experience the stagnation we live with today. We need less and simpler regulations. We need less and simpler taxation. The recipe for a booming economy is to invite "everybody" to participate and to be willing to actually let "everybody" participate.
Gulp! Is that the darn "Red Pill" going down? Sorry, I know its going to be a tough ride.