We know that US businesses are facing a large number of problems, some of which are listed below.
- Barriers to entrepreneurship
- Tax increases
- Social Contributions increases
- Labour legislation
- Ineffective institutions
- Poor law enforcement
- Low transparency of public spending
- Growing state debt
- Strict code of work
- Low quality of education
But what about Slovakia? What triggered the decline of Slovakia’s competitiveness? Could this list had something to do with it?
Yes, it does.
And it so does because we lied. In reality this list is the long list of nonsense the Slovakian government inflicts on their citizens. This is, according to the Slovak newspaper SMEsk who analyzed the situation. Their veredict? Cronyism and Bureaucracy.
Yet somehow you accepted the premise that this list originated in US. Why was that?
Simple. It also applies to US. And EU. And Japan. And Russia. And every other country in the world. One way or another governments manage their economy into the ground.
Slovakia’s competitiveness has fallen from the 35th position in 1997 to the 78th in 2013. Only Greece’s competitiveness is worst, according to the World Economic Forum.
This is bad. Decline in competitiveness translates into lower economic activity which translates into lower standards of living.
But there is something worst. Something that these rankings do not measure: wealth destruction. Decreased competitiveness comes hand in hand with wasted wealth which must be expended just to survive in such a bureaucratic jungle. Nobody is measuring how much poorer everybody becomes when competitiveness takes a dive.
We can go a step forward in our analysis. It is obvious and clear that human beings are, statistically speaking, the same anywhere in the world. There are bright and dumb people in the same proportion in any geographical location. Their abilities to conduct business are the same in any location. Then why is that there are so many differences when you cross a simple, meaningless line on the ground called a border?
In a word? Governments.
Yes. Governments make a big difference in terms of economic activity, they depress it. Rankings such as the ones of the World Economic Forum only serve to remind us not how well countries are doing, but how bad governments are depressing economic activity. Such rankings rate governments from the less inept to the most inept. This is universal.
In an Absolute Austro-Libertarian system the entire world achieves maximum economic capacity through the simple fact that there are no governments to inhibit it. There are no meaningless political barriers or stupid legislation or incompetent politicians. World-wide economic capacity reaches its maximum simply because all the people transact business to the maximum degree they are capable of. The maximum economic potential of the entire human race is realized, with no need for rules and no interference from external factors.
So, next time you engage your friends in political conversation, you may want to mention these facts. And ask the what are they doing about this.
In the end, it’s your choice. Economic prosperity or decline. You choose.
Note: please see the Glossary if you are unfamiliar with certain words.
