GIS – Comment by Prince Michael of Liechtenstein*
The innovation and freedom required for prosperity are threatened by unaccountable supranational organizations, expanding state bureaucracies and misguided public policies.
Over the past three years, one of businesses’ main concerns has become securing supply chains for raw materials and semifinished products. But another factor that has grown just as troublesome, or maybe even worse, is the lack of good workers. Inflation is now the topic on everyone’s mind. Prices are rocketing. People are rightfully concerned. Officials attempt to calm the public by claiming that this situation will be overcome because it is mainly due to the interruption in supply chains caused by Covid-19, and now by the war in Ukraine. U.S. President Joe Biden even went as far as to call it Vladimir Putin’s inflation. The European Central Bank and its president constantly denied a medium- to longer-term problem and were consequently always wrong in their forecasts. These are either cynical lies or proof of incompetence.
On the contrary, this inflation is structural. It is caused by demand exceeding the supply of goods and services. Consumers, including governments, have money in abundance. Central banks’ irresponsible money printing to cover government overspending and waste has created a situation in which the amount of money circulating throughout the economy disproportionally exceeds the goods and services on offer.
This phenomenon is exacerbated by the growing number of people in nearly all economies engaging in supervisory and administrative jobs – mainly public services – instead of productive private sector positions. The flood of laws, rules and regulations issued on national and supranational levels has become a self-fueling engine, sucking up more and more resources.
Driven by irresponsible deficit policies, the public and administrative sectors are growing. In turn, the bureaucratic complications feed such sectors as tax advisory, compliance, legal services and standardization boards, but also supranational bodies such as the 38-nation Organisation for Economic Co-operation and Development.
Talent badly needed in business is absorbed into these new professions, made necessary by expanding government. These roles then feed complications that create more layers of unproductive positions in public administration and business advisory. At the same time, we see that next to inflation and supply-chain disruptions, a severe shortage of workers in productive jobs is one of the economy’s biggest problems.
We are becoming increasingly authoritarian and hiding behind democratically unaccountable supranational organizations. The unstoppable regulatory process gives authorities increasing power and opportunities to make arbitrary decisions. Any perceived threat, from terrorism to Covid-19 to climate change, is welcomed as a pretext to tighten the screws on freedom. It is certainly necessary to fight terrorism, support sustainability and take measures against pandemics, but all of those goals can be achieved without placing disproportionate limits on freedom and constructing convoluted bureaucracies.
Through excessive administration, legislation and regulation, restrictions on freedom, government overspending and irresponsible monetary policies, we are committing suicide as a free and prosperous society. This suicide is assisted by a collusion of governments, supranational organizations, rent-seeking cronies and ideas such as the “great reset” promulgated by the World Economic Forum.
When we will have finally succeeded in killing a prosperous economy, politicians, media and nongovernmental organizations will blame the failure on markets, not the state. The proposed solution will then be more government intervention and “full equality.” Such solutions are already being implemented. When the trend is complete, the bureaucratic dream of 19th- and 20th-century communists will have come true.
In this state-dominated economy, we will have to forget about prosperity and freedom. A bureaucratic nomenklatura will impose an equality of mediocrity. Sustainability will become an illusion as innovation is held back. The old Soviet model is making a comeback. It is surprising that people have forgotten so quickly and do not realize what is happening. They just need to look to North Korea to see how the model works.
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