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Saturday, September 30, 2006

 

Starting Over in New Orleans

The United States has become extremely complex as a country. Laws are multiplying in number and changing everyday, politics are in everything, and large groups and organizations are becoming more and more powerful and influential. The U.S. is following exactly what Olson describes in his book, The Rise and Decline of Nations. There are so many influential groups now in the US that they are affecting the economy. Large groups will rather take a large piece of a smaller pie at the cost of society as long as they are better off. Established cartels have incentives to have strong barriers to entry. People in politics do things by making more laws, which just makes things more complex. Groups are using large amounts of time and money on politics and cartel activity, and less money on production. One way this can be stopped is by starting over. For example Germany did very well and grew rapidly after WWII. I’m not saying it’s a good thing what happened in New Orleans, but maybe now they can break away from some of these complexities and become very prosperous by starting over.

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