Saturday, April 12, 2008

Alex Alben on presidential power

High tech executive and Former Mercer Island resident Alex Alben writes an excellent summary of the limits of Presidential power in this week's Seattle Times:

For a candidate to claim that he or she can "create jobs," or "fix the economy," by any combination of policies is not simply bombast, it is highly misleading and diminishes the true role of our private sector and financial markets.

That's true on fiscal policy, as Alex correctly shows how tiny a proportion of U.S. economy consists of spending controlled by government.  Businesses have far, far more influence of course on, say, job creation.

But what about non-fiscal policy, on things like the minimum wage, environmental standards, or immigration?   Poorly-designed policies that make it harder for businesses to hire and fire -- or conversely, well-designed policies that make individual and companies more competitive -- seems to me that politicians have quite a bit of influence on this part of the economy too, just as they do over the foreign policy and social issues that Alex names.

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