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My two cents: the U.S. owes much of its economic strength to its robust legal framework. It provides a system where complex business disputes can be handled and

by wslh 2y ago

My two cents: the U.S. owes much of its economic strength to its robust legal framework. It provides a system where complex business disputes can be handled and enforced effectively, creating trust and predictability for investors and entrepreneurs. This institutional strength is often overlooked but is critical for fostering innovation and long-term economic growth. Incidentally, recent Nobel laureates in economic sciences have focused on the role of institutions in shaping economic outcomes, underscoring how pivotal they are to success.

deleted 2y ago
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alephnerd 2y ago
> the U.S. owes much of its economic strength to its robust legal framework Pretty much. This is the mainstream institutionalist view which won AJR a Nobel Prize. This is also the reason why China began the Guiding Case Project with Stanford Law before it got shut down due to Xi 2's crackdown.
- deleted 2y ago
  [deleted]
ein0p 2y ago
The US owes its "economic strength" to the ability to print $2T/yr in perpetuity and buy stuff with that money. Once that tap ceases to function (which eventually it will, though not anytime soon), the US is going to be fucked beyond any recognition.
- georgeecollins 2y ago
  That's irrational and alarmist. Any time I hear someone talk about "printing money" I figure I am hearing from someone who doesn't have a great grasp of finance. For those that are interested, the supply of US currency or purchasing power of the government is not controlled by printing. A steelman of this argument is the USA has too much debt and can't keep issuing this much. Maybe true. But the world holds that debt and it's denominated in USD. Also, just the simple wealth of US households grows a lot faster than the debt so its still pretty clear that if the US wanted to pay all its debts it easily could. (https://fred.stlouisfed.org/series/BOGZ1FL192090005Q https://fred.stlouisfed.org/series/BOGZ1FL192090005Q) We could be heading for inflation like in the late 70's early 80's. Not good but you don't have to doomsday prep.
  - jameslk 2y ago
    We're heading into 1940s inflation, not 1970s. 1970s inflation was lending driven. 1940s inflation was fiscally driven, like it is today.
- wslh 2y ago
  Even if you are correct, it might be worth mentioning that the US is the top military power, which adds strength to the equation.
  - ein0p 2y ago
    Some folks from Afghanistan and Yemen must have died laughing after reading that sentence.
UncleOxidant 2y ago
Doesn't the EU also have a robust legal framework?
- rootusrootus 2y ago
  I would have thought so. But on the other hand, it seems to me like there is a lot more appreciation on the part of EU for laws to be enforced more in spirit than in letter. That might not be a good legal environment for businesses.
- DoingIsLearning 2y ago
  There is EU law, which is enacted across all EU members. But there is no such thing as a EU legal framework, neither is there a fiscal one if we are focusing on business. A debt dispute could be resolved in less than 4 months or dragged for close to a decade depending on which EU state you have a business. Same goes for fiscal law. Some countries have had pretty much the same rates and taxation arrangements for decades. Some countries change their fiscal load on businesses as much as twice in one year. Both cases are technically 'the EU'.
- bpt3 2y ago
  Yes, and it is generally hostile towards wealth generators. And then they wonder why nearly every economic metric has been stagnant for decades at this point...
  - DoingIsLearning 2y ago
    Pointing to EU law/regilations is just platitudes people keep repeating online. Biggest barriers to business in the EU is risk averse Investors and Banking sector, lack of significant VC funding players, and Government spending strangled by Austerity policies. The US spends a lot of money to make even more money.
    - bpt3 2y ago
      > Pointing to EU law/regilations is just platitudes people keep repeating online. I disagree, for the reason mentioned below. > Biggest barriers to business in the EU is risk averse Investors and Banking sector, lack of significant VC funding players, and Government spending strangled by Austerity policies. Some of it is cultural I'm sure, but when your reward is capped it's logical to limit risk. Your list of issues are indicators of a risk-averse mindset. Regarding the comment above: If most of the return from your risky venture is going to be taken from you by the government, why take the risk? > The US spends a lot of money to make even more money. Yep. It's like the stock market vs. bonds. The ride is bumpy but more lucrative over the long run.
YetAnotherNick 2y ago
One thing that I believe is overlooked is that two party system helps in the sense that both party knows they are here in the long run, and while both party talks extreme economic plans, they just don't go forward with anything, just some tariff here and there. In lot of other countries you don't know how extreme the ruling party would be in next few decades.

by wslh 2y ago

deleted 2y ago

[deleted]

alephnerd 2y ago

> the U.S. owes much of its economic strength to its robust legal framework Pretty much. This is the mainstream institutionalist view which won AJR a Nobel Prize. This is also the reason why China began the Guiding Case Project with Stanford Law before it got shut down due to Xi 2's crackdown.

deleted 2y ago
[deleted]

ein0p 2y ago

The US owes its "economic strength" to the ability to print $2T/yr in perpetuity and buy stuff with that money. Once that tap ceases to function (which eventually it will, though not anytime soon), the US is going to be fucked beyond any recognition.

georgeecollins 2y ago
That's irrational and alarmist. Any time I hear someone talk about "printing money" I figure I am hearing from someone who doesn't have a great grasp of finance. For those that are interested, the supply of US currency or purchasing power of the government is not controlled by printing. A steelman of this argument is the USA has too much debt and can't keep issuing this much. Maybe true. But the world holds that debt and it's denominated in USD. Also, just the simple wealth of US households grows a lot faster than the debt so its still pretty clear that if the US wanted to pay all its debts it easily could. (https://fred.stlouisfed.org/series/BOGZ1FL192090005Q https://fred.stlouisfed.org/series/BOGZ1FL192090005Q) We could be heading for inflation like in the late 70's early 80's. Not good but you don't have to doomsday prep.
- jameslk 2y ago
  We're heading into 1940s inflation, not 1970s. 1970s inflation was lending driven. 1940s inflation was fiscally driven, like it is today.
wslh 2y ago
Even if you are correct, it might be worth mentioning that the US is the top military power, which adds strength to the equation.
- ein0p 2y ago
  Some folks from Afghanistan and Yemen must have died laughing after reading that sentence.

UncleOxidant 2y ago

Doesn't the EU also have a robust legal framework?

rootusrootus 2y ago
I would have thought so. But on the other hand, it seems to me like there is a lot more appreciation on the part of EU for laws to be enforced more in spirit than in letter. That might not be a good legal environment for businesses.
DoingIsLearning 2y ago
There is EU law, which is enacted across all EU members. But there is no such thing as a EU legal framework, neither is there a fiscal one if we are focusing on business. A debt dispute could be resolved in less than 4 months or dragged for close to a decade depending on which EU state you have a business. Same goes for fiscal law. Some countries have had pretty much the same rates and taxation arrangements for decades. Some countries change their fiscal load on businesses as much as twice in one year. Both cases are technically 'the EU'.
bpt3 2y ago
Yes, and it is generally hostile towards wealth generators. And then they wonder why nearly every economic metric has been stagnant for decades at this point...
- DoingIsLearning 2y ago
  Pointing to EU law/regilations is just platitudes people keep repeating online. Biggest barriers to business in the EU is risk averse Investors and Banking sector, lack of significant VC funding players, and Government spending strangled by Austerity policies. The US spends a lot of money to make even more money.
  - bpt3 2y ago
    > Pointing to EU law/regilations is just platitudes people keep repeating online. I disagree, for the reason mentioned below. > Biggest barriers to business in the EU is risk averse Investors and Banking sector, lack of significant VC funding players, and Government spending strangled by Austerity policies. Some of it is cultural I'm sure, but when your reward is capped it's logical to limit risk. Your list of issues are indicators of a risk-averse mindset. Regarding the comment above: If most of the return from your risky venture is going to be taken from you by the government, why take the risk? > The US spends a lot of money to make even more money. Yep. It's like the stock market vs. bonds. The ride is bumpy but more lucrative over the long run.

YetAnotherNick 2y ago

One thing that I believe is overlooked is that two party system helps in the sense that both party knows they are here in the long run, and while both party talks extreme economic plans, they just don't go forward with anything, just some tariff here and there. In lot of other countries you don't know how extreme the ruling party would be in next few decades.