Root on Lawyers

Not read much by Mr. Wayne Root, perhaps some of you have, but I will start reading him as in my economist mind he nails it in this piece. In September 2012, Root resigned all Libertarian Party positions, re-joined the Republican Party and endorsed Mitt Romney in the 2012 presidential election.

I’ve reported the numbers here in my newspaper column before. The stock market has soared upward the fastest in history under President Trump. Christmas bonuses are up dramatically. GDP is headed to the moon- almost tripling the GDP of Obama’s eight years. Jobs have soared since Trump became president- up 2.2 million since his election. Manufacturing jobs just had the best month in history. Confidence levels of small business owners, manufacturers and consumers are the highest in years. It’s literally “The Trump Economic Miracle.”

How did President Donald J. Trump turn the economy around so fast? He hasn’t even repealed Obamacare, or passed his gigantic tax cuts yet. So, what changed? The answer is Trump’s secret sauce…

“It’s all about the lawyers, stupid.”

There’s a famous joke I love to tell. “California leads the country in lawyers. New Jersey leads the country in toxic waste dumps. How did that happen? New Jersey got to pick first!” I LOVE this!

As terrible as taxes are, there is an invisible tax that is much worse for business. It’s called regulations. It’s not a sexy topic, so it’s never in the media headlines. No one talks about it. But when regulations are heavy, business is strangled and suffocated. Middle class jobs vanish. No one wants to risk, invest, or create a quality job.

And why are regulations so terrible? Because regulations breed lawyers. Obama loves regulations and lawyers. Some people dream of sugar plums, rainbows, a beach in Maui, or a new Ferrari.  Obama dreamed about new regulations and lawyers. As president, Obama hired thousands of lawyers to work three shifts, 24 hours a day. Then he whipped them into a frenzy to create thousands of new regulations.

Obama set all-time records for every category of regulations. The most regulations by number, by pages, by words, and by dollar value. Obama created the most regulations ever in one year. And the most regulations of any president in history. And of course, that required the most lawyers in history. 

Under Obama it was raining lawyers!

No business owner, entrepreneurial idea man, or investor can survive in an environment like this. So, like so many millions of other businessmen in the Obama era, I stopped opening businesses. I stopped investing. I stopped raising money. I raised about $20 million for various businesses under President Bush. I didn’t raise $1 dollar in eight years under Obama. Regulations and lawyers killed the fun, killed my entrepreneurial spirit, killed the risk-reward ratio.

I’ve been in business for 35 years since the day I graduated Columbia University (as Barack Obama’s classmate). When I got out of college, I went into business without a lawyer. I rarely ever needed a lawyer for anything- other than my incorporation papers. I called a lawyer perhaps once a year. My legal bills were nominal. Lawyers were an afterthought to my business startup plans.

Because of Obama and his regulations, everything changed. My legal bills went through the roof. My entire life became lawyers. No businessman or woman can make a move anymore without consulting a lawyer. Every contract I look at, let alone sign, requires thousands of dollars in legal bills. Today, my lawyer is my business partner- whether I like it, or not. Lawyers under lawyer Obama (and lawyer wife Michelle) became the biggest cost of doing business. Coincidence?

The remarkable dichotomy between the economic results of Obama vs. Trump is really just the result of an economy dominated by lawyers, versus an economy dominated by business risk-takers and job creators.

President Trump is already the greatest regulation killer in the history of the presidency. He has killed billions of dollars of regulations. And most importantly, he isn’t replacing them with new ones. One of Trump’s very first Executive Actions as president laid down the law- for every new regulation created, two regulations must be killed. The result: Lots of out of work lawyers!

This is President Trump’s secret sauce. “It’s all about the lawyers, stupid.” Trump isn’t just killing regulations. He’s killing off lawyers. And that’s a great thing for all of us. That’s why to business owners across America, this will be the merriest Christmas ever!

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