Yuval Levin has a powerful piece in the Weekly Standard, an astute and sweeping analysis of the problems of the American economy. This is the kind of undogmatic dealing with realities that ought to be the signature of conservative thinking about policy. It's been too long absent—but could it not be making a return? Let's hope…
If you were to judge the state of the country by listening only to the Romney campaign, you would conclude that all was well in America until we took a wrong turn four years ago and elected a president hostile to freedom and prosperity. If we just correct that error and undo what he has done, our economy will be ready to bloom again.
…
ADVERTISEMENT
Americans are nervous not only because the economy has yet to bounce back, but also because we have a sense that the economic order we knew in the second half of the 20th century may not be coming back at all—that we have entered a new era for which we have not been well prepared.
…
Our government finances are in shambles, our public sector is woefully inefficient, and our private economy is very poorly served by a set of policies and institutions that seem intent on denying us a productive future workforce and on subjecting more and more of the economy to a regulatory mindset that prefers consolidation to growth.
…
.The two sectors of our economy that have seen the most job growth in the past decade have been the two most government-dominated sectors: health care, and government employment itself (especially in education). In both cases, that growth has decidedly not been matched by improvements in productivity. Our health care system—largely as a result of Medicare and Medicaid and of the poor design of the tax treatment of employer-purchased health insurance—is horrendously inefficient, inflating costs without any relationship to outcomes and playing a central role in an economy-wide wage stagnation. In education at all levels, meanwhile, we have been paying more and more for less and less—the very opposite of productivity improvement—while much-needed reforms have been prevented by powerful unions and their allied politicians.
...
The private economy is not exactly getting geared for efficiency either. The failure of education reform makes it difficult for too many younger Americans to gain the skills they will need to compete with foreign workers in tomorrow’s economy, and our immigration policy imports low-skilled foreigners to compete with low-skilled American workers while denying employers the high-skilled workers they lack. It is the worst of all worlds for building American human capital and driving productivity and innovation.
