How Red Tape Silliness from Government Bureaucracies Stifles Growth and Wastes Resources

At the recent global climate gathering COP28, 22 countries including U.S., Canada, France and U.K. pledged to triple nuclear power capacity by 2050. Will it happen? Within days of the December 1 announcement I was reading criticisms of the idea. I recently read that in this country, nuclear energy regulations and red tape are 100 times more stringent than other power generation systems. 

The other day Reason magazine ran a headline stating Biden Issues 'A.I. Red Tape Wishlist.' The subhead reads, "Biden's new executive order will slow the development and deployment of artificial intelligence technologies." 

When will they "get it"? Their "intentions" are always good, but realistically, it's results that matter. 

Here's the opening paragraph of the story:

"The National Institute of Standards and Technology is charged with setting up the additional safety standards with which the AI developers are supposed to comply. Complying with such reporting requirements will likely slow down the process of safety and security testing undertaken by Big Tech developers while at the same time driving out smaller competitors who cannot afford the costs of dotting regulatory i's and crossing bureaucratic t's."

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When it comes to the economy or troubles in our cities, name a problem, any problem, and it would not surprise me to have been either created or exacerbated by government interference and "red tape." Here are some of the ways bureaucratic rules are a drag.

Hindered innovation and progress
Stringent regulations and complex approval processes can stifle innovation, particularly in fast-paced sectors like technology and healthcare. Budding entrepreneurs may get bogged down in paperwork and permits, discouraging them from bringing their ideas to life.

Waste of time and resources
Navigating red tape can be incredibly time-consuming for both individuals and government agencies. Filling out endless forms, attending unnecessary meetings, and complying with bureaucratic procedures can divert resources and personnel away from more productive activities.  (See: The F-35 Boondoggle.)

Slow and inefficient response to crisis
When disaster strikes, natural or otherwise, navigating the maze of regulations and approvals can cripple the speed and effectiveness of relief efforts. Delays in bureaucratic procedures can exacerbate the initial damage and leave people suffering for longer. Or worse, decisions are made quickly with no plan as regards implementation. The "heroic" posturing results in the public having less confidence rather than more as regards their elected officials. 

Unequal access to resources and opportunities
Bureaucracy can disproportionately affect marginalized communities and individuals. Complex application processes and lack of transparency can create barriers to accessing essential services like healthcare, education, and social support, perpetuating inequalities and hindering upward mobility. Just being poor is a barrier. When complicated red tape is generated by well meaning bureaucrats, the haves are armed with CPAs and accountants. The masses get strangled while those with means go merrily on their way.

Loss of public trust and confidence
Frustrating experiences with bureaucratic hurdles erodes public trust in government institutions. Delays, inefficiency, and a perceived lack of accountability all work together to breed cynicism and disillusionment, reducing cooperation and participation in civic life. (I have a number of examples I could cite here. Let's start with "Do Not Call" lists. What a farce.)

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The Problem of the Underclass

When my brother was working on his Masters in psychology in Chicago, he had what seemed to him an essential "Aha!" experience in a therapy group he was part of. He called me afterwards and shared this insight, which moved him profoundly: "I am responsible for my behavior."

The ramifications of this basic insight are many. If I make bad choices, I am responsible. If I want to change my circumstances, it is up to me. If I do not want to wake up in my own vomit every morning, I have to change the decisions I make the result in that. 

These thoughts came to mind as I started reading Life at the Bottom: The Worldview That Makes the Underclass, a book I received as a Christmas present but am just finally getting around to reading. The author Theodore Dalrymple is British psychiatrist who has spent his life working in the slums and prisons of England. 

The straightforward opening sentence hits with great force. "A specter is haunting the Western world: the underclass." 

That opening reminds me of another opening, from Scott Peck's The Road Less Travelled. "Life is difficult. This is a great truth, one of the greatest truths." And once we've resigned ourselves to the reality, everything gets easier. 

In Dalrymple's introduction, the author outlines where his book will take us, that we might better understand the mindset of those who live in "the purgatory of our slums."

There are really two kinds of poverty. There are those who have little or nothing, but make choices that open more opportunities. This is different from the "cycle of poverty" that perpetuates itself from one generation to the next, the kind we get a glimpse of in Hillbilly Elegy, for example.

In many respects, as I have begun the journey this book is taking me on, I see our current "problem of the underclass" as a symptom of bad philosophy. Having discarded common sense, the culture has embraced a new belief systems whose foundations are fictional, yet feel good because they alleviate us of responsibility. 

The author addresses issues in a manner that feels honest, based on decades of first hand experience. Even if you do not accept his assessment, I believe the book can be a useful starting point for serious discussions about a topic that will not be going away any time soon. 

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What Is Financial Literacy and Why Does It Matter?

Here's a Tweet I saw recently. Seeking Alpha is an online community offering research tools, investment analysis  and forums for investors. 

Nathaniel E Baker
a senior editor at Seeking Alpha
https://twitter.com/natbaker

Stocks trim losses as traders realize lawmakers aren’t mentally equipped to do anything about any of this stuff anyway 

Seriously, we talk about teaching financial literacy in school. Maybe we should start by teaching it in Congress?

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What is Financial Literacy?

According to Investopedia, financial literacy is the ability to understand and effectively use various financial skills, including personal financial management, budgeting and investing. The lack of these skills is called financial illiteracy. 

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Having Money Doesn't Solve All Problems

Why? Consider these numbers, from another article by Tim Parker at Investopedia: "Why Athletes Go Broke." (See link below)

According to Sports Illustrated, 78% of NFL players who are retired for only two years file for bankruptcy, and after five years of retirement, 60% of NBA players suffer the same fate. According to a study in the  National Bureau of Economic Research (NBER) as well, close to 16% of the NFL players in the study that were drafted between 1996 to 2003 also filed for bankruptcy within just 12 years of retirement. 

If you know anything about NFL salaries, they really aren't all roses. The median salary is still under a million dollars a year, and you can bet they work hard for it. The average NBA salary is 7 million though. Hard to believe that 60% of these guys are flat broke in five years, except that (a) they never learned basics of handling money or (b) who they could trust with their finances. Kudos to the survivors. 

If you won a million dollars in a lottery, who would you turn to to help you figure out taxes and what to do with the rest?

Sooner or later this is a skill you must learn to master.
Don't wait till it's too late, or you could have financial disaster.

Learning to live within your means and setting aside for the morrow,
Is better than the alternative future of having to beg, steal or borrow.

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Check out my poem, Futures and Other Investment Ideas 

Related Link

Why Athletes Go Broke

Philosophical Inquiries: Document 47

Why did Zarathustra leave the cave and begin sputtering like a madman?

Why were they painting the passports brown?

Why did the pond weep when Narcissus no longer leaned over her to gaze at himself?

Whose box was it originally and why was Pandora blamed for opening it?

What kind of medicine was Johnny mixing up in the basement?

In light of genetics, instincts, institutional coercion and social programming, to what extent can people ever really be free?

How can we ever hope to understand one another when it's likely we don't even understand ourselves?

Why is it illegal to sell my kidneys but O.K. to give them away?

Who's the better bass player, Paul McCartney, Jack Bruce or Charles Mingus? How would Tony Garnier answer that?

What is the difference between the mind and the brain? How is it that we always say, "She's losing her mind" and not "He's losing his brain"?

Can mental illness be something temporary like a common cold?

Can love heal all wounds?

Sometimes we describe people as mentally unbalanced. What does a perfectly balanced look like?

How many warning labels can one balance on the head of a pin?

When all is said and done, the big questions still remain. Where did we come from? Where are we going? Why are we here?

If you've been a regular visitor here, thank you. Hope your weekend is a very special one.