Sustainable Competitiveness for the American Democracy

Much is being talked about the state of the US Democracy these days. The system is “broken”, the country divided. Its global power – both in terms of raw power and technological leadership – is deteriorating fast, as is the global appal of the US. This decline has been in the making for some time; the complete lack of leadership over the past 4 years have accelerated the deterioration, and made it visible for the whole World to see.

Management consultants are trained to analyse system efficiency and spot the weaknesses in those systems to formulate improvements that increase efficiency. The following analysis is based on this approach. In addition, it is based on the US performance in the Global Sustainable Competitiveness Index (GSCI),

The current state of affairs

The current status of the American democracy described, in short:

• Government dysfunction: The political system is in a stale of disfunction. Other than urgent compromises to prevent complete shutdowns, compromises can hardly be reached. Important policy adjustments seem impossible to achieve – a clear sign of too little democracy
• A raging opinion war: The country seems is divided into two, with the two sides living in a completely different perception of reality, fuelled by conflicting and/or selective interpretation of events and click-baiting by profit-orientated news distributors
• Innovation decline: Apart from a handful of Silicon Valley companies, the US industry is outpaced by global competitors
• Inequality: Social inequality is increasing – from an already high level. Crime levels and substance abuse are on an unsustainable level
• Deteriorating environment

Key Recommendations

As management consultants, we are only interested in making system more efficient. Recommendations as how to address the above failures would include, in short:

• Governance systems: Curtail the power of individual functions and cutting historical red tape. In particular, the Speaker of the House and the Senate Majority Leader role should to be completely abandoned; it is not possible that two individuals decide over the agenda, topic and time of votes in Congress. In addition, the majority voting system should be replaced by a proportional system for congress mandates as well as state representations that would allow for smaller parties to take hold in parliament.
• Establishing simple, secure processes (e.g. e-voting based on blockchain) for elections, but also referenda on new or changed laws to increase accountability of politicians.
• Bridging the divide: A national news network, financed through taxes, but completely independent from political influence – focussing on reporting news and facts, excluding opinions, with regional offices and broadcasted in each state to counter the stream of misinformation
• Restart innovation: provision of high-quality education everywhere: redistributing education budget on the federal or state level per student to ensure equal quality of education everywhere. Introduction of an apprentice system after 9 mandatory school years with on-the-job training, enabling early work and guarantees a highly qualified work-force.
• Facilitate equality: Taxing financial income higher than employment income – most efficiently accomplished through a financial transaction tax. Decriminalise drugs. Introduce strict licensing and registration of all firearms
• Saving the environment: internalise all external costs through fiduciary neutral taxes (taxes redistributed to the people, e.g. as a climate tax)

For more information, download the Report “Sustainable Competitiveness for the American Democracy”