Recession inducing politics…

There seems to be a fairly extensive discussion recently about weather suppressing economic output, particularly given the extended winter weather in the East and Mid-West.  I am taking the ZeroHedge stance and am not convinced that weather patterns across half of the US are impacting global economies the way analyst are convinced (or are trying to convince others).  It seems to me an excuse for terrible politics and policies that are continuing to suppress economic strength.

1. The ACA (a nice way of saying Obamacare) continues to baffle businesses and consumers, who have no clue what the rules are, who has to provide what, how the fines/fees/taxes will be levied, or even how safe they are.  So far, all indications are that the ACA is failing to meet its promises, has not insured more people than were originally insured, and will suppress economic output for decades (if not forever).  If it truly encourages people to leave the workforce, then their productivity is lost while their expenses are born by others through taxes/fees/fines.  This does not bode well for future growth.

3. The ACA did not solve the third-party payer system that is the primary SOURCE of the high cost of health-care.

2. Constantly increasing regulatory oversight by the EPA, IRS, OSHA, NLRB, Dept. of Health, Dept. of Labor, etc… is not helping companies, who have zero incentive to grow.  ZERO INCENTIVE TO GROW!  Once they decide to give up, its over… Additionally, property rights are being enforced loosely, implying people will not invest in property when insecure in contracts and control.

3. TAXES ARE DISINCENTIVES.  If taxes on cigarettes or soda are supposed to reduce consumption by increasing their cost, then HOW DOES THE MINIMUM WAGE FUNCTION ANY DIFFERENTLY? If you increase the cost of labor, employers will purchase less of it… Inequality will not be solved by minimum wage increases.  That is not possible.

4. There is mixed evidence that inequality is a problem – and inequality created through new technology, new businesses, new inventions, new ideas, or productive contributions is unlikely to have hugely negative impacts on the economy.  Inequality is “bad” when it is generationally protected wealth, which represents a small minority of wealth in the US.  Even then, it is not clear that it has negative impacts on everyone else…

So take a few minutes to think about it… regulation and political divisiveness are clearly suffocating us, not weather.  Don’t believe the bullshit.