Government, regulations not what’s holding us back

Posted Tuesday, Feb. 11, 2014  comments  Print Reprints
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I am so happy that Richard Greene can sleep better at night knowing that the public agrees with him that “big government” is the problem (see “Sounding the alarm over an ever-growing government,” Sunday)

I still toss and turn at night because I believe the problem to be more complex.

I just finished reading a report by McKinsey and Company, the world’s largest business consulting firm. This report is not the product of the liberal media Greene whines about.

According to McKinsey, the reason jobs have not rebounded with the economy is that firms: (1) re-engineered their workforces to get more work out of fewer people, (2) exported jobs overseas to reduce labor costs, and (3) replaced people with technology. In short, the jobs went away permanently.

I did not see big government and burdensome regulation on the list of causes. While I agree that less regulation and lower taxes will provide a short-term lift for the economy, it does not address many of our long-term issues:

• In an international economy with free trade, how do we create jobs that are valuable enough to support high standards of living and amenities such as healthcare and retirement? India, China, and Third World countries do not concern themselves with such issues.

Our moral and ethical standards would not tolerate factories where workers sleep in company cots and eat company rice so they can work longer hours or where workers are routinely exposed to cancer-causing agents. In many countries, such conditions are routine.

Our challenge is to create jobs that are competitive and still compatible with American values and moral sensibilities.

• Perhaps an even greater challenge is to educate people with skills and knowledge that cannot be replaced by computer code and other disruptive technologies.

If your job involves answering questions with factual knowledge, IBM’s Watson computer makes you irrelevant. If it involves guiding people to the best Italian restaurant nearby, Siri has replaced you.

Even many jobs requiring decision-making are at risk because of advances in predictive analytics applied to “big data.”

What are the future knowledge and skill requirements that only humans can perform? How do we construct educational systems that impart these capabilities? These are huge public policy questions.

You won’t get the answers to these questions from current or former politicians.

Why? Because our current system has degraded to opposing groups trying to enact legislation that serves the immediate wants of the special interest groups that finance their campaigns — whether liberal or conservative. This process is not to be confused with objective problem solving or building consensus around sensible solutions.

• Instead of the same tired old liberal-versus-conservative ideological conflicts that solve nothing, we need liberals to understand and endorse the power of free enterprise, market dynamics, entrepreneurship, creative innovation and increased productivity.

In the long-term, this is how the needs of the less fortunate are to be met.

• We need conservatives to understand that the more people who participate and fully benefit from our economy, the better it is for all. Investments in preschool, education generally, social infrastructure (healthcare, transportation, etc.), job retraining and entrepreneurial participation that expand upward mobility and economic independence will benefit everyone.

Businesses need customers with spending power. Hopefully we don’t get to the point where Neiman Marcus and Dollar General are the only retailers left standing.

More regulation, higher taxes and wealth re-distribution solves nothing, but neither does an unregulated, everyone-for-themselves, free-for-all that worsens income disparity.

Does government have a role? Yes, the same role that a referee plays in sports: to be sure that competition is fair and abides by the rules and values that society supports for the enterprise.

Unless we can begin to objectively understand our problems and collectively build and support real solutions to them, government proceedings will continue to be as they currently are: Much ado about nothing!

Steffen Palko is an assistant professor at Texas Christian University. s.e.palko@tcu.edu

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