June 25, 2009


Just a few months ago, members of Congress took turns wagging their fingers at CEOs of the automakers for not making tough choices–not shedding “legacy costs,” not making products consumers wanted, not cutting bloated bureaucracies. Detroit had become self-referential, unable to compete because it was unwilling to deal with its internal constituents. . . .

Detroit is Google compared to Washington. Year after year, Congress makes laws but almost never repeals them. Washington is like a huge monument to legacy costs. Laws from the Depression will send tens of billions in unnecessary subsidies this year to farmers, organized labor and other groups thought to be in need–80 years ago. Bloat is also notorious–it’s nearly impossible to fire anyone under civil service laws, so layers of middle management have grown exponentially. Professor Paul Light found 32 levels in some agencies (compared to 5 levels in most well-run enterprises).

All this accumulated law–about 300,000 pages of federal statutes and regulations–operates as a form of central planning. It bogs people down in bureaucracy. In healthcare, the labyrinthian requirements of Medicare, Medicaid, HIPAA, plus the equally dense, and often conflicting requirements of 50 states, plus the insurance company red tape, make it impossible for people to deliver care efficiently. Add to that bureaucratic nightmare the ever-present fear of being hauled into court whenever a sick person gets sicker, and you have a system that looks like it was designed for frustration and waste.

Read the whole thing.

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