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By Catallaxy Files
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There’s no excuse for lazy policies

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I recently had the pleasure of travelling through the United States and Canada (although encountering the army of needlessly invasive US customs and TSA officials was far from pleasurable, and by no means made me feel secure).

Over a period of two weeks, I investigated the policy and institutional underpinnings separating the more economically robust sub‑national jurisdictions, such as Texas and Alberta, from the others, and the kinds of economic and fiscal reforms (if any) enacted by American states and Canadian provinces in recent decades.

I also spoke to think tanks and industry representatives in jurisdictions enjoying significant recent increases in shale oil and gas exploration and production. This included a short period of time in Bismarck, North Dakota.

While the experts I spoke to in North Dakota bullishly insisted that the shale oil boom will continue into the foreseeable future, and drive America’s future energy independence, it was clear that the boom had already generated rent-seeking processes whereby numerous interest groups contested for their share of growing royalty and other revenues flooding the state government’s coffers.

Given North Dakota’s middling ranking in North American economic freedom indexes, reflecting in part some aspects of higher taxation, paternalist regulations and government ownership across various sectors, it was also apparent that broad‑based policy reforms reducing the size and scope of government, that could benefit all sectors, were not being pursued while the political classes were busily drinking from the fountain of shale oil revenues.

Much of what I was hearing during my time in Bismarck, and to a lesser extent other places such as Colorado and British Columbia, reminded me of Australia, exemplified by its politically short‑sighted approaches to tax as much of the mining boom proceeds as practically possible, and then spend it on activities and ventures of questionable economic value.

In today’s edition of The Australian newspaper an opinion piece of mine (accessible online by subscription only) has been published serving as something of a reflection about some key findings from my time in the small, midwestern state with a population of fewer than 700,000 people. The concluding paragraph of my piece states:

As impressive as the resources boom here and abroad may presently appear, tax-and-waste fiscal responses and reform complacency both fail to position economies for broad-based improvements in international competitiveness and economic prosperity in the long run.

2013-01-02 01:17:55

Source: http://catallaxyfiles.com/2013/01/02/theres-no-excuse-for-lazy-policies/



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