U.S. ranks behind Rwanda, Belarus, Azerbaijan in ease of creating new business, World Bank says

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One of my favorite economists is Hernando de Soto who has long studied the difficulty of starting businesses in different parts of the world.

He explains that new businesses are often vehicles out of poverty for people around the world. Where competition and entrepreneurship are encouraged, where a better mousetrap is rewarded, where ideas can be developed and tried, wealth is created. Often spectacularly.

On the other hand, where entrepreneurship is retarded, where the powers that be in government and in established businesses (often one and the same) layer red tape on top of innovators and dreamers wealth is diminished. (For most people. The cronies usually do OK, at least for a while.)

The United States has historically been a champion of free enterprise (at least in relative terms) but it is falling behind. We make it increasingly hard to start a business here. There are licenses, and regs, and who knows what else depending on the jurisdiction in which one resides.

When businesses are hard to start, jobs are not created. Wealth is not generated. The economy becomes stagnant and people start fighting over pieces of a diminishing pie.

We’ve had  it so good for a such a long time that many people think that means we can just dump a pile of welfare state (corporate welfare and otherwise) on top of the productive economy and America will remain the exceptional place it has been historically.

It won’t.

(From The Washington Examiner)

The report found that New Zealand is the easiest place in the world to create a new business. Starting one there requires “one procedure, half a day, (and) less than 1 percent of income per capita and no paid-in minimum capital,” the study noted. New Zealand was followed by Canada, Singapore, Australia and Hong Kong in the top five.

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