Some of the inspiration for this project came from the remarkable 1980 memo (here) to President-elect Ronald Reagan from his Coordinating Committee on Economic Policy.
Like that memo, this is a book about governance, not politics. It's not partisan -- copies are being sent to both campaigns. It's not about choosing or spinning policies to attract voters or win elections.
The book is about long-term policies and policy frameworks -- how policy is made, return to rule of law, is as important as what the policy is -- that can fix America's problems. It focuses on what we think are the important issues as well as policies to address those issues -- it does not address every passion of the latest two-week news cycle.
The book comprises the answers we would give to an incoming Administration of any party, or incoming Congress, if they asked us for a policy package that is best for the long-term welfare of the country.
The chapters, to whet your appetite:
INTRODUCTION
CHAPTER 1: The Domestic Landscape by Michael J. Boskin
IN BRIEF: Spending by George P. Shultz
CHAPTER 2: Entitlements and the Budget by John F. Cogan
CHAPTER 3: A Blueprint for Tax Reform by Michael J. Boskin
CHAPTER 4: Transformational Health Care Reform by Scott W. Atlas
CHAPTER 5: Reforming Regulation by Michael J. Boskin
CHAPTER 6: National and International Monetary Reform by John B. Taylor
CHAPTER 7: A Blueprint for Effective Financial Reform by John H. Cochrane
IN BRIEF: National Human Resources by George P. Shultz
CHAPTER 8: Education and the Nation’s Future by Eric A. Hanushek
CHAPTER 9: Trade and Immigration by John H. Cochrane
IN BRIEF: A World Awash in Change
CHAPTER 10: Restoring Our National Security by James O. Ellis Jr., James N. Mattis, and Kori Schake
CHAPTER 11: Redefining Energy Security by James O. Ellis Jr.
CHAPTER 12: Diplomacy in a Time of Transition by James E. Goodby
CLOSING NOTE: The Art and Practice of Governance by George P. Shultz
My chapter on a Blueprint for Effective Financial Reform is a better version of the talk on Equity Financed banking which I posted here. (The talk was based on the paper. Now you have the paper.)
My chapter on Trade and Immigration is new, and an uncompromising red-meat free-market view. I don't think one should compromise centuries old economic understanding just because it's not politically popular at the moment.
If you got this far, you might also be interested in my Economic Growth essay written for a parallel but similar project.
The entire book can be found here:
ReplyDeletehttp://www.hoover.org/sites/default/files/research/docs/george_shultz_blueprint_for_america_ch1.pdf
http://www.hoover.org/sites/default/files/research/docs/george_shultz_blueprint_for_america_ch2.pdf
http://www.hoover.org/sites/default/files/research/docs/george_shultz_blueprint_for_america_ch3.pdf
Etcetera. Just change the chapter number at the end to find what you are looking for.
My "official" link is better as it is maintained by the Hoover press and will be updated if there are any changes.
DeleteJust reading the 1980 paper you gave a link for.
ReplyDeleteHere are some prescient words that I don't think made it into:
"Many failures of government can be traced to an attempt to solve problems piecemeal. The resulting patchwork of ad hoc solutions often make such fundamental goals as military strength, price stability, and economic growth more difficult to achieve."
In short - don't sweat the small stuff, focus on the big picture.
"Central problems that your administration must face are linked by their substance and their root causes."
In short, be aware of the possibility of unintended consequences.
"Consistency in policy is critical to effectiveness."
This amounts to rules based policy - both monetary and fiscal.
Open borders would lead to doubling of worlds GDP? That's just delusional. That assumes that the economic rules and institutions arise randomly from the ether and social capital, trust and socialization are irrelevant. Amazing sentiment, considering the clear evidence in the US that different groups with different social capital perform very differently under the same rules and circumstances.
ReplyDeleteI wasn't able to find that reference in John's paper on Trade and Immigration. However I did find his description of America as underdeveloped (84 people per square mile) in comparison to the England and the Netherlands somewhat interesting.
DeleteThe paragraph that struck me most was this one:
"To the extent that all the dollars don’t end up buying American goods, foreigners end up buying assets in America, investing in our businesses. To the extent they do not buy private assets, they invest in our government bonds, financing deficits and US government spending that would otherwise vanish."
Based upon the Brief by Shultz, Chapter 2 - Entitlement Reform, why is vanishing government spending such a bad thing? I would think that entitlement reform would walk hand in hand reducing the federal debt - including foreign ownership of that debt.
What else would you call interest on the federal debt but an entitlement? At least with Social Security, you worked in a productive enterprise for a time and made regular tax payments to assist with funding the system.
It's bad enough that the federal government sells entitlement bonds to it's own tax base, but then it proceeds to sell them abroad where no U. S. tax base exists? How much tax revenue has China contributed to make the interest payments on the federal debt it owns?
Perhaps the U. S. federal government should also offer social security and medicare and all of it's other entitlements around the world without concern with how much it's own domestic taxpayers are footing the bill.
As a pro-business kind of guy, I find it dispiriting that the right side of the aisle remains devoted to spending more and more on the military, our largest federal organization.
ReplyDeleteThe US spends $1 trillion a year on national security (DoD, DHS, VA, debt service and black budget).
Yet we have this from the Shultz book: "Forty years into an all-volunteer military force, our broader society
is losing sight of the necessity of maintaining a war-fighting
military."
If we spend $1 trillion a year, and we do not have war-fighting capability, I want my money back.
Our Founding Fathers loathed, detested and reviled standing militaries, and counseled against foreign entanglements. Today we have a permanent and hyper-mobilized, global professional military. This is not in the American spirit.
Better we return to a spartan citizen-soldier military of draftees and true volunteers (who serve for two years and out, and live like soldiers, in tents and basic conditions).
Small, trim, spartan, effective. Composed of our true fellow citizens.
On regulations, I would have liked a chapter on the largest structural impediment in the USA today: Property zoning.
But no one believes in free enterprise in their own neighborhood. Bring bulldozers to my single-family detached neighborhood?
I am little puzzled at open borders and no minimum wage. Really?
Draftees -- government theft of young people's time, so the old wealthy people they protect don't have to pay decent salaries? Two years to barely learn how modern weapons function, then out? Living in Tents??? I'm glad you're not running for Defense secretary.
DeleteOpen borders with minimum wages? That sounds like a good way to create a classic European Jihadi slum. Let lots of low skill young men in the country, but don't let them work at low-productivity jobs, where they can learn English, US skills, habits and culture.
You seem a bit Grumpy, Dr. Cochrane. I am starting to get the feeling you prefer policy to politics. There have been a few hints of that in your recent posts. Maybe I should tell on you to Brad Delong, so he can call you stupid. Would that help? I think you are smart, fwiw, but would merely point out that the GOP is not the vehicle for your sensible ideas.
DeleteJohn Cochrane: A professional or mercenary military has become the most powerful interest group in DC. The VA budget alone will top $200 billion soon.
ReplyDeleteWe won WWII and Korea with draftees and true volunteers who lived in tents.
We have not won a war since, despite fantastic expense.
If weapon systems are too complicated to use, that suggests bad design.
Our Founding Fathers had wisdom for the ages. A citizen-soldier military is a safegaurd for taxpayers, citizens and democracy.
John Cochrane: A professional or mercenary military has become the most powerful interest group in DC. The VA budget alone will top $200 billion soon.
ReplyDeleteWe won WWII and Korea with draftees and true volunteers who lived in tents.
We have not won a war since, despite fantastic expense.
If weapon systems are too complicated to use, that suggests bad design.
Our Founding Fathers had wisdom for the ages. A citizen-soldier military is a safegaurd for taxpayers, citizens and democracy.
Great post. But too long still i just red half of it. :P
ReplyDeleteLooks really well and it is something good to read know on vacations, thanks for the advice Jhon
ReplyDelete