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Below is a guest post from the Sound Money Defense League. CRI does not necessarily endorse or oppose the views expressed in the article below, but we do believe it’s important to understand the value of money and how currencies get debased.

We Americans no longer carry gold and silver money in our pockets and purses as our grandparents did during their lives. But we still carry the history, legacy and spirit of those gold and silver coins in our language – with more meaning than you might imagine.

“Sound money” has a clear message recognized for centuries around the world. It describes the musical, metallic ring of a gold, silver, or copper coin dropped on any hard surface of glass, stone, wood, or metal. Sound money literally refers to real wealth, with a natural, unmistakable signature of honesty and integrity, as opposed to the swishy paper and plastic debt used almost exclusively today.

The term “sound money” is believed to come from Ancient Rome, where small silver coins were standard in everyday commerce, for paying Roman soldiers to buying exotic goods from all corners of the known world. As Rome squandered its wealth, it found what seemed an easy shortcut to shore up the treasury. It gradually debased those silver coins with common metals, ultimately cutting the silver content to just 5 percent.

But that didn’t fool anyone for long, most of all disciplined Roman soldiers, who did not appreciate being paid with worthless mystery metal in return for risking their lives on Rome’s bloody battlefields.

Do You Want True Money or a Debased Dud?

Not every Roman soldier had room in his gear for a touchstone, usually fieldstone or slate, also used to test the purity of metals. But they quickly discovered the difference in the sound of true money and a debased dud.

They recognized that real silver had a distinctive melodious ring when bounced on a hard surface, such as the blade of a handy sword, a bronze breastplate, or an ornate marble floor. Sound money carried the ‘ring of truth,’ while debased coinage landed with a dull, disappointing thud.

The debasement of Rome’s silver currency unmasked the deceit of a bankrupt empire, which ended with the fall of Rome, a pattern repeated many times. Sound money’s “ring of truth” had found its place in the history of money and of nations.

As the United States grew westward to the Pacific Coast and north to Alaska, gold, silver and copper coins of all nations were legal tender in the young United States until the 1850’s, and were in use even long after that. Americans with no formal education in reading, writing and arithmetic relied on the sight, sound, and feel of the only money they knew. Learning the different musical ringing sounds of those coins could easily qualify even a prairie settler fresh off the wagon train as an economic expert.

In the Old West of the range roving American cowboy, the ring from that silver dollar tossed on the bar of polished oak told the saloon keeper he was pouring whiskey for sound money, and not for a counterfeit forgery.

The sound money test unmasked one of the most famous counterfeiting schemes in American coinage history. The Liberty Nickel (1883-1913) was originally struck without the words “Five Cents,” bearing instead only the Roman numeral “V.” Gold plated Liberty Nickels were passed off as a newly designed $5 gold piece, but the sound money test quickly identified the scandal. Within six months of issuing the first “V” nickels, the U.S. Mint added the words “Five Cents.” But for the next many years, every Liberty $5 Half Eagle in town was tested for its ring of truth.

Sound money means simplicity, honesty, and trustworthy recognition. It stands for strength and durability, which were also characteristics of those pioneering Americans who built our nation.

The ring of sound money for centuries has transcended borders and nationalities by singing its own melodic language. No matter what words were stamped into a precious metal coin, that ring of sound money certified its value, or exposed the deception.

Governments Have Distorted the Meaning of Money

“Sound money” carries such a powerful message there’s little wonder that governments issuing paper fiat currency have attempted to corrupt its meaning, with help from unimaginative and lazy educators and journalists.

“Hard currency” first referred to metal coins, not paper money, but the term over the years has come to mean that flimsy, paper, folding cash is more trustworthy than a handwritten check or IOU.

“Good as gold” is another aberration of “sound money,” usually referring to credit worthiness, even though there is no credit as good as gold.

When Washington and Wall Street began pushing plastic credit cards, which are nothing more than debt disguised as wealth, Americans were introduced to the gold card along with the credit rating and FICO score as a false measure of one’s financial worth. Today, the newest edition of the $100 Federal Reserve note carries a golden inkwell and feather pen, as if to sarcastically say money itself is a masquerade of paper script and not precious metal.

Americans today have no memory of those times when gold, silver, and copper coins were tossed across a store counter, or counted out by hand, to pay for everything from penny candies to Ford Model-T automobiles. That era began ending when President Roosevelt in 1933 outlawed the use of gold coins in everyday American commerce.

The separation of Americans from their Constitutional heritage to true money continued through 1964, with the end of small coinage containing 90% silver. The deception was complete by 1982 when copper quietly disappeared from the Lincoln penny.

But no government could remove the ringing echo of sound money from history, or from us. And government cannot camouflage its counterfeits with gold colored paint. You can experience sound money’s evident ring of truth for yourself. Toss any gold or silver coin on your kitchen table and you will hear the history of honest money ringing down through the centuries.

And perhaps, thanks to grassroots projects like the Sound Money Defense League, you will hear the trumpeting of better days to come.

Sound Money Defense League and MoneyMetals.com columnist Guy Christopher is a veteran writer living on the Gulf Coast. A retired investigative journalist, published author, and former stockbroker, Christopher has taught college as an adjunct professor and is a veteran of the 101st Airborne in Vietnam.

 

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The lifeblood of Delaware is the multitude of businesses incorporated in the state, some of which do not even exist within Delaware’s borders beyond a P.O. Box in Wilmington, and yet they pay taxes that make up a substantial portion of the state’s revenue. For years Delaware has been the premier place for a company to incorporate, and over half of all U.S. corporations are incorporated in the first state, in large part thanks to the state’s first rate court system that deals with businesses fairly and expediently. This means that it is cheaper to go to court in Delaware, and that means less costs that businesses have to absorb into their bottom lines or pass along to their customers. Although Delaware’s business court system remains the best in the country, other states are catching up.

State lawmakers have done their best to offset the savings offered by Delaware’s efficient court by creating ludicrous financial burdens on businesses and their employees that keep them away from the state. Because of these costs, many companies decide it is not worth it to open up actual offices in Delaware and subject themselves to the high taxes imposed by Delaware. Furthermore, many employers stay out of Delaware because their employees do not want to live there, because of failing schools and high crime, especially in Wilmington. Hundreds of millions of dollars in wealth has fled New Castle County in the past 15 years, undoing much of past efforts to attract business into the state. The state should be leveraging its accommodating courts to attract businesses to establish an actual presence in the state, rather than scaring them off with high taxes and unattractive communities.

Other states have also begun to attempt to reform their courts to make them more business friendly; both Nevada and North Dakota have improved the regulatory burdens they impose on states, and North Dakota especially has worked to reduce the tort costs inflicted upon its companies. In all likelihood the measures taken by theses states will poach some corporations from Delaware and will cut into growth in the number of new incorporations in the first state. It is a testament to the success and foresight of Delaware’s model that other states are attempting to emulate it and in a sense beat Delaware at its own game. For now Delaware’s courts still remain the most accommodating in the country, but other states are working to provide their own alternatives. Given the state officials complacency in making Delaware competitive, the possibility of other states surpassing Delaware grows by the minute.

States like North Dakota offer a vastly more hospitable tax climate compared to Delaware. North Dakota is making the smart decisions Delaware is not, attracting companies into the state with a potent combination of friendly courts and a sensible tax policy, that work in tandem to create a great offering. Meanwhile Delaware’s tax burdens offset the benefits its courts offer, wiping out any net-gain the courts might provide to a company looking for a place to start or expand. Overall it often makes more sense for a company to do business in North Dakota than Delaware, when one combines the combined effects of the states’ regulatory and tax policies. North Dakota is working to attract the P.O. Boxes and then turn them into offices, while Delaware only expands the financial burdens of doing business in the state and watches those P.O. Boxes disappear.

Jack Massih

CRI Intern

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This guest post is provided by Jack Massih, CRI’s summer intern. This is his debut post.

Connecticut recently decided to walk off of a cliff with its tax hike on businesses, and unsurprisingly the affected companies are looking to move to friendlier climates. Governors from Florida, Texas, Georgia and even New York quickly jumped at the opportunity, calling CEO Jeffery Immelt to explain why their state is the best place for GE’s new home. Delaware, with its business friendly reputation, ostensibly seems a natural place for GE to plant its new headquarters, but Delaware has fallen behind other states in offering a pro-business atmosphere, and if GE does decide to move, it is a near certainty they will not relocate to Delaware. For a State that has historically acted to accommodate businesses, this is a troubling development, indicative of the disastrous path state leaders have charted for Delaware.

As the current General Assembly looks to raise the personal income tax on the state’s wealthier families and raise the gross receipts tax on businesses, it is easy to forget there was a time when Delaware actually cut taxes and streamlined regulations to attract businesses and their employees to the first state. Lawmakers and Governors worked hard to woo the banking industry into Wilmington, and they adroitly maneuvered to land AstraZenica’s corporate office. Such policies paid off massively for Delaware, and even though tax rates were decreased, revenues grew as people and businesses flocked to the first state. In recent years many other states have prospered thanks to this pro-growth model, and Delaware was the pioneer of such policy, but state lawmakers have forgone this proven path to success in favor of increased taxes and ever expanding regulations.

One merely needs to examine the wealth migration into and out of Delaware to understand that families and companies vote with their feet. Money is still coming into the state from surrounding states in the mid-Atlantic and northeast, but much of it is offset by wealth leaving the state for even sunnier financial climates in the south. Delaware seems to be nothing more than a layover on the flight of money out of the region, rather than a permanent destination. Smart decisions to cut taxes sensibly will entice that money to stay within the state, boosting revenues and infusing communities with cash, while reckless tax hikes and wanton government spending will permanently scare it away. Delaware is straddling the line between being a winning state or a losing state, and current decisions by the General Assembly threaten to push it into the losing camp.

The risks of Delaware’s loss in competitiveness go beyond families and businesses leaving the state, there is also the loss in growth due to companies choosing not to relocate or expand into Delaware. Not only does the state run the risk of turning away established businesses and residence, it stands to lose out on the next generation of AstraZenica’s and banking firms. As firms like General Electric looking to relocate pass over Delaware, the state will lose out on the important revenue growth these income-earners and employers will bring, and its options to meet its ever growing spending commitments will invariably shrink to increasing taxes and/or making drastic discretionary cuts to state services. Both unsavory options inevitably push people out of the state and leading to an increasingly vicious cycle of austerity as people abandon the state and the tax base decreases further.

In order to avert such a scenario state officials need to drop their current tax and spend predilections and carefully examine their options to make Delaware more competitive. The bad news is that in many respects Delaware is lagging behind many other states; its tax burden is one of the highest in the country, and it is one of the few states that levy both a corporate income tax and a gross receipts tax. However this also means Delaware’s lawmakers have many routes to take in order to make Delaware more attractive to businesses. What Delaware should do is examine the states that have lined up to court General Electric and attempt to recreate their environments. In many cases these states have no personal income tax or no corporate income tax, a lower overall tax burden, and sensible regulations that make it easier to conduct business.

Delaware was once an expert at making itself hospitable for businesses and workers and it must rediscover that talent or it will lose out to states that recognize the need for sensible regulations and tax policy. The beauty of the federal system is the competition it engenders between the many states, encouraging creativity and common sense while punishing irresponsibility and complacency. If Delaware wants to keep its reputation as the first state for business, it must abandon its current self-defeating policy of constantly raising taxes to meet swollen budgets, and it must instead make itself attractive to business through the pursuit of pro-growth policies that will allow the state to reap the advantages of a healthy economy. The sooner citizens come to this realization the sooner Delaware can work to restore its waning competitiveness.

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Today is the fall-out day for Christina School District, after the voting public voted 54-46 to not approve a referendum for a smaller tax increase than the one asked for in February.

With this, the district says they now have a $9.5 million budget shortfall. They say over 100 teachers, paraprofessionals and secretaries face layoffs, with more possible depending on next year’s enrollment. Extracurriculars, maintanance, and textbook purchases are also likely to be delayed or cut.

There is a lot of anger on both sides about this vote. Check out one well-known blogger’s take on the referendum; he is clearly upset that a majority of voters opted not to pay extra for CSD to continue running. Or read the comments section in the News Journal. On the one hand those who supported the referendum are furious that there will be layoffs at the classroom level; on the other hand, those who voted no are unhappy that they are being accused of not caring about kids when some went on record saying they want the district to watch how it spends money and cut all spending until they can cut no more, and then they can ask for a tax increase.

This was actually the position of some of the school board members in Capital School District, when they ran for office (and have, for the most part, kept to their word). Only after all efforts are made to reduce wasteful spending should school boards ask their constituents for a tax increase.

We at CRI have no dog in this fight. We are not allowed to support or oppose a referendum, and this illustrates the need for voters to be informed about the issue before going out to vote.

Here are some facts:

  • Christina SD spent more money in 2013, the latest year Transparent Delaware has data for, on employee payroll. Now Christina Sd has the second-largest public school enrollment (Red Clay is #1), and part of the district encompasses Wilmington. However, Red Clay’s reported payroll was $130.3 million, or $27.6 million less than Christina, for roughly equally-sized districts.
  • Both districts have roughly the same number of non-public school students, and each has a charter school which has been accused of taking only the “best” students. Newark Charter and for Red Clay, Charter School of Wilmington.
  • It’s not a 100% perfect comparison, but the state DOE says Christina SD employed 2,749 people this year, of which 43% were in-classroom teachers. Using roughly $158 million for spending for this year, that’s an average district salary of $57,475.45, which is above the statewide average for both private and public sector employees. Now this is, of course, a somewhat inaccurate picture: the state DOE says a new teacher with a bachelor’s degree and 4 or fewer years of experience makes about $41,000, but at 15 years of services averages at $61,530. Have a Master’s degree? That teacher can start out at just over $47,000 and at 30+ years of service averages just over $77,000 a year. 54% of district staff (included non-teachers) have a Master’s.
  • 60% of the district is made up of Black and Hispanic students, and 41% of students are low-income while 18% are classified as special needs. The good news is, the overall graduation rate is up. The bad news is, the district’s SAT scores are lower than the state average, which is already 50th in the nation (we will soon have ACT data to back up our SAT results).

The district absolutely has a lot of challenges, and it may be time to split the Wilmington section from Christina and build a school district just for Wilmington, so the city’s leaders can focus on helping those kids, or splitting Wilmington into just two districts (Red Clay and Brandywine). But Christina, like virtually every other district in Delaware, is simply not producing results, and clearly the lack of money is not the problem.

For 50+ years, education leaders and union officials say if we just “invested” more in public education, we’d have  these great schools. But they never talk about changing the system, which is the real culprit here. Running a one-size-fits-all classroom setting only encourages proactive parents to pull their kids out and send them to charters or private school. They say they’re forced to take special needs and “problem” kids, but there are schools like Prestige Academy, Reach Academy (soon to close), Tall Oaks Classical School, and Kuumba Academy who will take in students from different backgrounds, not just the “good” kids. For instance, in 2013-2014 Prestige’s student enrollment was roughly 20% who were classified as special needs or requiring an IEP. There are schools who will take students from diverse backgrounds, but the most ardent proponents of public schools will not allow parents the opportunity which can be offered via an Education Savings Account, insisting that all kids go to public school, then complain when they get the kids they won’t allow to leave.

It’s long past time that Delaware, and the rest of the country, take a look at our public school system and implement real changes. The ultimate focus should be on how we as a society can best educate our kids, not who gets the money. As long as who gets the money is the focus of our system, it will be the kids who suffer the most, as ultimately the students will be the ones who will be affected by the fallout from yesterday’s referendum.

For the record, there is no word on how many of the district’s 108 employees (4% of the total) who earn over $100,000 in total salary will suffer pay cuts or job loss.

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Every year, the General Assembly finds a way to balance the budget, as they are required to do by our state constitution, or at least use accounting gimmicks to move spending around so future liabilities aren’t held against the current FY budget.

This year, the state’s “in a pickle”, so to speak, or maybe something to do with scrapple would fit better. There is a budget deficit in the neighborhood of $70 million, which increased after legislators caved to state employee demands not to pay additional expenses for their healthcare policies due to a wage freeze for most state employees, a freeze which has lasted for years. Not only did they not make this move at the request of Governor Markell, but they added $21 million to the deficit with money we don’t have to keep their constituents happy.

Meanwhile, the state wants money to pay for infrastructure spending, cleaning up the waterways, investing in startups/businesses to grow the economy, paying for increased Medicaid and public education expenses, services for the increasing number of senior citizens retiring into Delaware, and so on. As spending goes up, the state is collecting less from casino revenue and  personal and corporate income taxes than in previous years. You can see where we’re going to run into problems, and we’ve predicted for some time that the next governor of Delaware is going to have a serious fiscal mess to fix.

So what do our elected officials have in mind to balance the budget? Some new ideas include: raising state income taxes on top earners from 6.7% to 7.6%, increase Delaware’s per-gallon gas tax, motor vehicle fees, and taxes levied on wholesale fuel deliveries to fund new road and bridge improvements, increasing the gross receipts tax, reduce corporate income taxes, eliminating the estate tax, and actually cutting personal income taxes across the board.

“There’s not going to be a split of these issues that will give us the transportation money and we’ll figure this out later,” Lavelle told the News Journal. “I didn’t fall off the banana truck yesterday. I’ve been fooled more than once down there and it ain’t going to happen again.”

Did you see what was missing among these ideas? Ways to cut state spending. This is how our state does “the water dance,” similar to how many indigenous tribes around the world pray for rain; they do a symbolic dance and hope the sky will open up and rain will just fall and provide much-needed water to grass and crops so they will grow and life can continue. Replace the actual dancing with accounting “dancing” (tricks), and the rainfall with moneyfall, and otherwise the concept is the same.

Now some of this has already been done; we know the state Department of Education is about to take a big hit, as Legislators have become increasingly opposed to the Governor’s education plan, which includes Secretary Murphy. Race To The Top funds are phasing out and school district referendums continue to alternate between passing and failing, which means some districts have found themselves cutting back on spending and hiring while freezing wages for some district employees.

Yet when we see the final budget, which must be passed by June 30, where else will the state consider making cuts? Senator Lavelle went on record suggesting that tax increase were off the table unless the prevailing wage law is reformed or repealed. Will Delaware Democrats be willing to stand up to their union supporters and change the prevailing wage law?

Another way the state could make cuts is to get us out of RGGI, which is a regional cap and trade scheme. RGGI does not do anything for the environment, but it does increase our electric bills by an average of $50/year per household, and thousands more per year for most industrial businesses, who have most of the remaining few manufacturing jobs Delaware still has. Will the GA make an effort to pull us out of RGGI?

Delaware has plenty of room where cuts could be made, the only determination will be whether they make them or not. In the meantime, please visit caesarrodney.org

for the latest news and information you can use to learn about our state’s fiscal situation and click on the “Impact Delaware” link to learn more about how you can make a positive impact on Delaware.

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Legislative Hall in Dover, Delaware

This article originally appeared at the Watchdog.org website on January 20, 2015. Read the original at http://watchdog.org/193657/legislative-priorities-2015-delaware-way/

Last week was the first week the state Legislature was in session, but they will soon adjourn for budget and finance hearings before getting back to lawmaking in mid-March. Five new representatives and one new senator took their oaths of office for the first time, but this Legislature looks almost identical to the last one: the Democrats control the governor’s mansion, the House of Representatives 25-16, down from 27-14 last year, and the Senate 12-9, down from 13-8.

Notably absent from the last General Assembly were bills to make Delaware’s economy more free as the state—well-known as the “Switzerland of America” for its easy incorporation process and fair Court of Chancery—faces competition from Nevada and North Dakota for corporate business and from the Sun Belt for jobs. This year the Caesar Rodney Institute hopes to see legislation to address the following issues:

1. Education Savings Accounts: Delaware has “school choice”-IF your idea of school choice is to allow a child to transfer from one public school district to another (provided that district has room).While that’s better than nothing, that’s not really school choice.

CRI supported a bill last year called the “Parent Empowerment Education Savings Account Act” (PEESAA) which would have introduced Education Savings Accounts as an option for low-income and special-needs students who are the most likely to need additional services not being offered by the traditional public schools. This bill was tabled in the House Education Committee but we hope ESA’s and other bills encouraging school choice are brought up this year.

2. Prevailing Wage (PW): Delaware has an insanely wide range of wages a that business who wants a public construction contract has to pay its employees to get the contract.

Every January the state Department of Labor mails out its PW survey to union-friendly contractors and conveniently “forgets” to remind non-union-friendly construction companies to ask for, and return, the survey. This results in wage variance like $14.51 per hour for a bricklayer in Sussex County, but $48.08 per hour for the same job in Kent and New Castle Counties. Not to be outdone, boilermakers get $71.87 an hour in New Castle County, but “only” $30.73 in Kent County.

These high rates prevent many construction projects from being started and make those which are done more expensive for taxpayers. If the PW won’t be eliminated, we hope the state will instead use the U.S. Occupational Employment Statistics survey. This would reduce rates by almost 40 percent on average and free up nearly $63 million of spending from the State’s FY15 capital budget, including almost $18 million for more school capital improvements.

3. Make Delaware the next right-to-work state: Delaware is not a right-to-work (RTW) state and, between that and our inconsistent-as-applied PW law, many businesses outside the state choose not to move here. Incorporating and buying office space in Wilmington for some high-paying executive jobs is one thing. But Moody’s Analytics in late 2013 said Delaware was the only state at immediate risk of falling back into a recession and a lot of this is due to more businesses closing than opening in Delaware. Pass legislation to end forced unionization and support pro-job growth policies instead.

4. Tax and regulatory reform: Only five states have a Gross Receipts Tax, which is a tax on revenue generated before profit and loss is factored in. Three of those states have no further taxes on corporate earnings and the only other state (Virginia) that does has lower tax rates. Between this tax, high personal and corporate income taxes, franchise taxes, and overall over-regulation by state agencies, Delaware is increasingly threatening its “Incorporation Golden Goose” as Nevada and North Dakota work to take business from the state. This needs to be addressed.

5. Work to lower energy prices: Delaware has electric rates 25 percent higher than the states we compete with for jobs like nearby Virginia. We import close to one-third of our electricity from out of state, the highest rate in the nation. Some of this is due to our geography, but a lot of it is due to the state’s failure to build a network of natural gas pipelines from the Marcellus Shale to Delaware.

Coupled with the state’s participation in the Regional Greenhouse Gas Initiative (RGGI) carbon tax scheme and taxpayer subsidizing of “green” companies like Bluewater Wind (gone), Fisker Automotive (didn’t build cars in Delaware), and Bloom Energy (still has not brought the promised 900 high-paying full-time jobs), Delaware cannot grow its economy if energy prices are high. We want the Legislature to pass natural gas pipeline extension and end participation in RGGI and subsidies for “green” companies.

What issues do you think the state Legislature should focus on this year?

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Since 2008 America has seen a greater number of businesses close than open. According to Gallup, roughly 6 million businesses out of 26 legally recognized actually function; the rest are inactive or exist only on paper. Of these 6 million “real” businesses, 3.8 million employ 1-4 employees. Only about 108,000 businesses in America (2% of “real businesses”) employ 100+ people. If we continue to kill off small business with over-regulation and over-taxation, how will the government be able to pay its bills, short of more printing, borrowing, and cancelling debts?

From Gallup: (article truncated for space)

“The U.S. now ranks not first, not second, not third, but 12th among developed nations in terms of business startup activity. Countries such as Hungary, Denmark, Finland, New Zealand, Sweden, Israel and Italy all have higher startup rates than America does.

We are behind in starting new firms per capita, and this is our single most serious economic problem. Yet it seems like a secret. You never see it mentioned in the media, nor hear from a politician that, for the first time in 35 years, American business deaths now outnumber business births.

The U.S. Census Bureau reports that the total number of new business startups and business closures per year — the birth and death rates of American companies — have crossed for the first time since the measurement began. I am referring to employer businesses, those with one or more employees, the real engines of economic growth. Four hundred thousand new businesses are being born annually nationwide, while 470,000 per year are dying.

You may not have seen this graph before.

Until 2008, startups outpaced business failures by about 100,000 per year. But in the past six years, that number suddenly turned upside down. There has been an underground earthquake. As you read this, we are at minus 70,000 in terms of business survival. The data are very slow coming out of the U.S. Department of Census, via the Small Business Administration, so it lags real time by two years.

Here’s why: Entrepreneurship is not systematically built into our culture the way innovation or intellectual development is. You might say, “Well, I see a lot of entrepreneurial activity in the country.” Yes, that’s true, but entrepreneurship is now in decline for the first time since the U.S. government started measuring it.

Because we have misdiagnosed the cause and effect of economic growth, we have misdiagnosed the cause and effect of job creation. To get back on track, we need to quit pinning everything on innovation, and we need to start focusing on the almighty entrepreneurs and business builders. And that means we have to find them.”

No matter how much some people will try to convince you the Roaring Twenties are back, the reality is that we have far too many businesses closing and not enough replacing them.Businesses do open and close all the time, but a lot of business closings are small businesses getting shut down because of government policy via regulation and taxation. A lot of these policies are Cronyist policies pushed by big business to weaken their competition, which is smaller stores. Thus for example, a big chain like Costco can safely come out in favor of the minimum wage increase knowing it will end up hurting the roughly 80 percent of businesses which employ nine or fewer people, while at the same time reaping the benefits of “caring” for their employees (note: we don’t object to Costco paying its employees well; we applaud it. But just because Costco might be able to afford a wage increase doesn’t mean every business can).

Crony business policies, government bureaucrats who make new regulations to justify their jobs, politicians who want to “do something” to get votes, and a well-intentioned but misinformed public which votes for things like minimum wage hikes  all result in a decline in new business startups and jobs lost and never created in the first place. We at CRI support economic policies which make it easier for people to start businesses and create new (hopefully well-paying) job opportunities without sacrificing necessary regulations and basic standards of decency. But unless we fundamentally change the way our country is operating, that 70,000 per year decrease in total businesses operating in America will increase in number.

Help support CRI! Your support allows us to research and provide analysis to the public on policies which will best grow the economy and create jobs. An end to the prevailing wage, Right to Work legislation, an end to Delaware’s gross receipts tax and lower corporate income taxes and personal income taxes, health care reform which encourages innovation from the private sector, and energy policies which would give people more choices would go a long way to helping Delaware, and America, make a sound economic recovery for all. Please consider making a contribution today.

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