How does Europe get out of its mess? Start with burning regulations.(Read article summary)
As a method of increasing economic growth we might want to have a bonfire of the regulations burdening European governments.
Markus Schreiber/AP Photo
I don't think there's anyone at all left (at least, not among those sentient) who would disagree with the idea that one way out of our current financial and debt troubles is to have a bit more economic growth. Such growth would mop up unemployment, increases taxes collected (without raising rates or changing incentives), reduce the deficit directly and as a percentage of GDP and while perhaps not paying off the National Debt at least reduce it as a percentage of that same GDP.
So, a "Dash for Growth" then but preferably not in the manner that this was tried in the early 70s. A hint of a different method is here:
The European Commission estimates the administrative burden of Greece's bureaucracy—the value of work devoted to dealing with government-imposed administration—is equivalent to 7% of gross domestic product, twice the EU average.
Do note that this is the EU's estimation of Greece alone's burden: they're not including the EU's own imposition of such burdens. But even if we take only this very low ball estimate, in the UK economy that average rate is £50 billion a year. And further note that that isn't the value of what we are prevented from doing by regulation, the opportunity cost: it is purely the effort put into filling in the forms.
To take one recent example: it is necessary to have a licence for two or more to sing folk songs in a pub. This £50 billion cost is not including the number of such dirges not sung, the pints not sunk as people attempt to blot out the noise. It is purely the cost of applying for the licences for such fiestas as do occur.
So, as a method of increasing economic growth we might want to have that bonfire of the regulations. We can all make our own list of the nonsenses which are demanded of us, the permissions that must be acquired before we can do any more than sit upon our own fundaments. Whoever's list we use we could boost growth in two ways: firstly by turning such entirely unproductive pencil sucking into effort that produces value and secondly by allowing economic activity which is currently dissuaded from coming into being by the costs of said pencil sucking.
We get to be freer, richer and further away from national bankruptcy all at the same time.
What's not to like about this idea?
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