Here’s a surprise!
The engine of world economic growth is sputtering. The most clear evidence of this is the lack of new business formation in developed nations across the globe. Over the last year, the number of entrepreneurs starting new businesses in the wealthiest of nations dropped 10% from the 2006-07 level; in the U.S., that number fell by 24%.
The contaminants in the fuel line are oppressive government policies that increase the cost of doing business, increase unemployment, and raise the risks to the current labor force of quitting their jobs to try to start new businesses.
At a time when government should be encouraging venture capitalists and the formation of new business, it is instead putting on the brakes to this source of economic growth in the form of cap and trade, compensation regulations, fees on banks, and myriad other explicit and implicit new taxes. In 2009, nearly half of U.S. employment was generated by small businesses; U.S. companies started through venture capital employed more than 12 million people, or 11 percent of private sector employment, and generated $2.9 trillion in revenues, or 21 percent of U.S. GDP.
Fully 100% of economic growth is created in private industry. Government simply redistributes that wealth, destroying some portion of it in the process. Never have we needed non-interventionist government policies more.
By Sherry Jarrell
Learning from Dogs 
Although the list of contaminants listed by Sherry is factual, an explanation prefered by many is the fact banks prefer to invest in derivatives, rather than in the real world. Moreover, private industry delocalizes to less developed countries.
“Cap and Trade” has no affected the European firms negatively, and is not the law in the USA. The very notion of economic growth is under suspicion. The fact is, there was no real growth per capita in the USA in the last ten years, and the list of taxes listed by Sherry went the other way.
The only conclusion is that it is precisely the LACK of taxes and regulations which brought the problem. At least in the USA.
Let’s look at it another way. In case you ask, French GDP productivity per capita is20% over that of the USA. Although no country has as many taxes and regulations as France. If I may allow myself some liberty: It helps not just to think out of the box, but also to see out of the box.
As JFK used to say, the USA needs a MIXED ECONOMY.
PA
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Patrice, could you provide a reference for your statement regarding GDP per capita comparing France to the US? A quick web search revealed:
IMF
US $47,440, France $34,205
World Bank
US $46,716, France $34,045
CIA Fact Book
US $47,500, France $33,300
Averaging them out, the figures become:
US $47,219, France $33,850 which I calculate as being 28% ahead of France.
P.
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These numbers use PPP, which should stand for:
Pathetic Propaganda Ploy.
That may be the problem with quick web search: no reading the fine print. Basically what these people do is to convert the Euro at one dollar. In truth, it is worth 1.42 dollar.
By the way I do not need a long lesson about the fact that PPP is supposed to stand for Price Purchase Parity. I know this, and I know the cheats inside the computation. Math PhDs can compute too, it’s not just all abstraction. The PPP computation, among other things, ignore the 19% AVT.
Anybody living half and half, as I do, can certify that French parents of working age are living WAY better than their American equivalents.
By the way I published related numbers a while ago on my site under http://patriceayme.wordpress.com/2010/01/12/europe-better-economically-than-the-usa/, where I explained the various propaganda ploys used to underestimate the French GDP, which is crucial to hypnotize Americans into believing that their system works better (it does not). It seems to work very well: mainstream US economist love to say that France’s global GDP is two-thirds of what it really is, and they believe it.
Here are the number of GDP per capita in 2008, untouched, source World Bank (an organism US controlled; CIA and IMF have similar numbers):
Country US$
1 Luxembourg 111,240
2 Norway 94,354
3 Switzerland 64,015
4 Ireland 63,185
5 Denmark 62,333
6 Iceland 52,557
7 Netherlands 52,322
8 Sweden 52,058
9 Finland 51,062
10 Austria 49,900
11 Australia 47,498
12 United States 46,716
13 Belgium 46,487
14 France 45,982
15 Germany 44,471
16 United Kingdom 43,089
17 Canada 42,031
18 Japan 38,443
19 Italy 38,310
20 Singapore 37,598
21 Spain 35,204
22 Greece 31,749
— Hong Kong 30,864
23 New Zealand 30,618
24 Equatorial Guinea 28,103
25 Israel 27,299
26 Slovenia 26,780
27 Portugal 22,842
28 Czech Republic 20,761
29 The Bahamas 20,699
30 South Korea 19,115
31 Saudi Arabia 18,973
32 Trinidad and Tobago 17,865
33 Slovakia 17,566
34 Estonia 17,223
35 Libya 15,921
36 Croatia 15,636
37 Hungary 15,409
38 Latvia 14,909
39 Antigua and Barbuda 14,318
40 Lithuania 14,097
41 Poland 13,823
42 Russia 11,339
43 Venezuela 11,230
44 Saint Kitts and Nevis 10,981
45 Turkey 10,746
46 Mexico 10,212
47 Chile 10,112
48 Gabon 9,968
49 Uruguay 9,654
50 Seychelles 9,649
51 Romania 9,301
— World 9,054
52 Palau 8,953
53 Kazakhstan 8,436
54 Brazil 8,400
55 Argentina 8,236
56 Montenegro 7,266
57 Malaysia 7,222
58 Lebanon 6,924
59 Mauritius 6,819
60 Serbia 6,811
61 Botswana 6,809
62 Panama 6,802
63 Costa Rica 6,592
64 Bulgaria 6,546
65 Belarus 6,229
66 Grenada 6,046
67 Saint Lucia 5,950
68 South Africa 5,685
69 Jamaica 5,604
70 Suriname 5,594
71 Saint Vincent and the Grenadines 5,442
72 Colombia 5,441
73 Iran 5,353
74 Azerbaijan 5,331
75 Algeria 5,061
76 Dominica 4,979
77 Bosnia and Herzegovina 4,891
78 Macedonia 4,673
79 Dominican Republic 4,655
80 Angola 4,628
81 Peru 4,420
82 Belize 4,403
83 Fiji 4,206
84 Maldives 4,060
85 Namibia 4,051
86 Albania 3,912
87 Ecuador 3,901
88 Ukraine 3,899
89 Tunisia 3,891
90 Armenia 3,873
91 Thailand 3,869
92 Turkmenistan 3,634
93 El Salvador 3,606
94 Cape Verde 3,469
95 Jordan 3,389
96 China, People’s Republic of 3,264
97 Republic of the Congo 2,960
98 Georgia 2,932
99 Samoa 2,884
100 Guatemala 2,851
101 Morocco 2,765
102 Marshall Islands 2,655
103 Syria 2,601
104 Paraguay 2,566
105 Tonga 2,548
106 Vanuatu 2,482
107 Indonesia 2,254
108 Swaziland 2,242
109 Micronesia 2,222
110 Sri Lanka 2,020
111 Mongolia 1,998
112 Egypt 1,998
113 Bhutan 1,979
114 Honduras 1,944
115 Philippines 1,848
116 Bolivia 1,722
117 Moldova 1,665
118 Guyana 1,517
119 Sudan 1,414
120 Nigeria 1,402
121 Kiribati 1,358
122 Solomon Islands 1,276
123 Papua New Guinea 1,267
124 Cameroon 1,239
125 Nicaragua 1,162
126 Yemen 1,153
127 Côte d’Ivoire 1,138
128 Zambia 1,135
129 São Tomé and Príncipe 1,085
130 Senegal 1,082
131 India 1,069
132 Vietnam 1,053
133 Djibouti 1,032
134 Uzbekistan 1,023
135 Pakistan 1,014
136 Kenya 896
137 Mauritania 894
138 Kyrgyzstan 838
139 Laos 838
140 Comoros 824
141 Lesotho 805
142 Benin 772
143 Chad 756
144 Tajikistan 752
145 Haiti 711
146 Ghana 691
147 Mali 688
148 Cambodia 652
149 Burkina Faso 523
150 Bangladesh 521
151 Tanzania 483
152 The Gambia 471
153 Madagascar 470
154 Uganda 459
155 Rwanda 459
156 Timor-Leste 454
157 Mozambique 447
158 Central African Republic 446
159 Nepal 442
160 Togo 438
161 Guinea 434
162 Niger 366
163 Sierra Leone 352
164 Eritrea 332
165 Ethiopia 329
166 Malawi 299
167 Guinea-Bissau 273
168 Liberia 230
169 Democratic Republic of the Congo 181
170 Burundi 145
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Patrice, I guess I asked for that! 😉
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Sorry, Paul, I thought I was a bit nasty and carried overboard… But I was just in the last stages of firing a great broadside against my good friend , and fellow “thorn”, Oblahblah.
http://patriceayme.wordpress.com/2010/01/23/way-out-for-obabush-bushama-and-oblahblah/
So I was a bit excited…
Anyway, it was good you pointed out this discrepancy: even Krugman WAS unaware of it, and ridiculized himself recently exactly about that, aggravating his case by pontificating about it [he was corrected by some of his commenters, although not by me, because I did not stoop…]
BTW, I have become an expert comparing the French and USA systems. I am not all gaga about France, in all ways, contrarily to appearances. Example: I got a USA passport of my daughter immediately, after a quick oath, but the French told me to prove I rented [Athena was born in France, and I have owned forever and a day, a few miles from the public hospital where the happy event occured.]
PA
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No apologies required at all. You and Chris could probably swap some interesting stories about France!
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