Imagine a world where a new invention created a virtually free and clean energy source that replaced oil. Trillions of dollars a year previously allocated to energy costs would be freed up to go elsewhere. The standard of living for everyone on the planet would go up geometrically. On the individual level current incomes would now buy you ten fold. The instabilities surrounding dependence on middle east oil would for the most part disappear. It would indeed be a different world with a wholly new set of possibilities.
So let’s introduce into this story our hero and protagonist, the inventor. By definition he or she would be born into that world in its pre-invention state. A world which I would describe as somewhat similar to ours, at least en potentia. But in this story there’s no Hollywood ending. Our inventor judges the world’s governments and institutions irreversibly flawed. He reasons that his invention will only serve to extend this moribund status quo. He concludes that his only course of action is to withhold this miracle invention.
The above is the backdrop for Ayn Rand’s novel Atlas Shrugged. I’m posting about it because it dramatizes in an engaging way an important dialog we need to have about government, economics, the individual and creativity. Governments have a huge impact on economic growth and individuals through spending, tax and regulatory policy. Some policies engender growth while others don’t. Bigger government requires more taxes leaving less capital for individuals and business. Less capital means less invention and less creation. From my perspective, we’re at an important juncture where we need to focus on creating wealth. It’s a way out of our current malaise. Create a bigger pie. Otherwise we could end up playing a painful zero sum game where government’s role becomes even more important in allocating scarce resources instead of allowing for their creation.
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THE LAST PARAGRAPH WAS BRILLIANT!!!!!!!!!!!!!!!!!
An important piece Jay. Keep up this dialogue. As a nation, we’ve got to pay attention to the size of Govt and what is happening. In less than 1 generation, our economic world as we know it can very quickly be ripped away. With the devaluation of the dollar and Federal Reserve policy to drive inflation, we’ve got to learn how to “create a bigger pie” for ourselves. Our employers are going to look for ways to make a smaller pie due to the cost of running a business. What innovation will American’s create in this generation to save themselves from extreme poverty?
Great Post Jay! Thank you!