Of bacon and bad policy

egg baconWhy do our fearless leaders in Washington continually claim that middle class jobs are their top priority while incessantly inflicting job-killing policies on us? I don’t think it’s an accident or an evil plot (well, not always anyway), but rather a simple case of cognitive dissonance. Let me illustrate.

I’m a big fan of the bacon makes everything better culinary method. I’d put bacon on yogurt, except I don’t like yogurt. And yet I also know that too much bacon is bad for me. So I cool the kitchen with my refrigerator while staring at those savory slices trying to talk myself out of piling pork belly on whatever lesser foodstuff will end up being lunch.

That’s called cognitive dissonance: a mental conflict that results from holding the two incongruous beliefs that bacon is the best thing since (or on) sliced bread, and that it’s also having the same effect on my arteries as pouring wet cement into a standpipe.

Ok, maybe that’s the Torquemada  of tortured metaphors. But the point is that our folks in Washington are suffering their own cognitive dissonance, stuck between a belief that they’re the answer to all the country’s ills and the reality that they’re actually the cause of all too many of them. Why does this matter?

Our economy has grown at a paltry rate of less than 2 percent since 2009. The historical average is just over 3 percent, and has exceeded 5 percent following the previous several downturns. Meanwhile we still have fewer jobs than in 2007, and of the jobs that have been created, seven times more are part-time than full-time.

Coincidentally during that period, back in Washington they’ve nearly doubled our national debt and issued over 100 new regulations expected to have an economic impact of at least $100 million per year. Well, maybe not coincidentally.

The federal government is going to borrow over $640 billion in 2013, or about 18 percent of overall spending. That’s $640 billion that is not available to the private economy for hiring people or increasing productivity. But that’s not the worst of it. Those 100-plus new regulations come with enormous compliance costs that small businesses simply cannot absorb. Sarbanes/Oxley, Dodd/Frank, EPA mandates, and of course the granddaddy of all mandated new costs – Obamacare – all increase uncertainty and raise marginal costs for small businesses, creating a climate antithetical to taking on new risk or increasing a small business’s workforce. And that’s a deadly combination because small and especially new businesses account for virtually all net jobs growth in this country.

Washington thinks that it has to do something or it’s not doing its job. That’s the nature of the beast. But the simple fact of the matter is that what they’re doing is actually harming the very people that they’re putatively doing “something” for. That’s cognitive dissonance; and until we convince them that we sent them there to govern not to rule, that they don’t have all the answers even if they knew the right questions, and that free people making free decisions in a reasonably regulated free market will result in the best outcomes for the most people, they’re going to continue putting Band-Aid on top of Band-Aid instead of letting the wound heal. They’re graded on activity. Outcomes occur on someone else’s watch.

There’s an old admonition that says lead, follow, or get out of the way. When it comes to the economy Washington doesn’t know how to lead. The people we send there there don’t have the humility to follow. And they can’t even process the possibility that we’d all be better off if they’d just get out of the way.

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