Deconstructing the Administrative State

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Deconstructing the Administrative State

For over fifteen years, the Trends editors have documented and forecast the institutional trans- formation needed to unleash the full potential of the most powerful economic leap in human history: the Deployment (or Prosperity) Phase of the Digital Techno-Economic Revolution. Here is how we summarized that challenge in the October 2014 issue:1

Since the collapse of the tech bubble in 1999, the U.S. economy has been transitioning from the Installation Phase of the Digital Revolution into its Deployment Phase. This transition is painful because the institutions that underpinned the Mass Production paradigm of the twentieth century have to be transformed to accommodate the twenty-first century Digital Paradigm.

Just as in the last such transition, called the Great Depression, the U.S. economy has been experiencing a sustained period of economic weakness.  This has become particularly apparent in the widening deviation that we’ve seen from the economy’s long-term trend line since 2007

  • The Political System
  • Macroeconomic Policies
  • The Tax System
  • The Legal System
  • The Healthcare System
  • The K-12 Education System
  • The Regulatory System

Notably, all of these institutions are primarily operated and controlled by the government. More importantly, all of these institutions were seen as deteriorating relative to our competitors.

In other words, our weakest institutions are getting weaker.

Based on this same assessment, the primary institutions enhancing America’s competitive advantage are:

  • Logistics Infrastructure
  • Skilled Workforce
  • Communications Infrastructure
  • Property Rights
  • Industry Clusters (like Silicon Valley)
  • Flexible Labor Practices (related to hiring and firing)
  • Management Expertise
  • Capital Markets
  • Research Universities
  • America’s Context for Entrepreneurship
  • Our Innovation Infrastructure

Notably, all of these institutions are primarily operated and controlled by the private sector. With the exceptions of “Logistics Infrastructure” and “Skilled Workforce,” all of them are seen as improving relative to the competition. 

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