U.S. "dysfunctional" political system biggest barrier to economy: Harvard study

The U.S. "political dysfunction" is no longer delivering good results to average Americans and has become the biggest barrier to the country's economic competitiveness, showed a Harvard Business School (HBS) study released Thursday.

The study, titled Pessimism about the Future of the U.S. Economy Deepens; Political Dysfunction the Greatest Barrier to Strengthening U.S. Competitiveness, is based on analysis of U.S. competitiveness and survey results from business leaders and the public over the past five years.

"The federal government has made no meaningful progress on the critical policy steps to restore U.S. competitiveness in the last decade or more," the authors wrote, blaming a government crippled by political polarization for a failure to enact tax reform and invest in infrastructure.

That failure, they wrote, "reflects an unrealistic and ineffective national discourse on the reality of the challenges facing the U.S. economy and the steps needed to restore shared prosperity."

"Business has too often failed to play its part in recent decades, and a flawed U.S. political system has led to an absence of progress in government, especially in Washington," they added.

"While a slow recovery is underway, fundamentally weak U.S. economic performance continues and is leaving many Americans behind," they noted.

"Economic anxiety is fueling angry, divisive political campaigns with proposals that could make the economy worse. The American political system is now threatening the American economy, and vice versa," HBS professor Jan Rivkin, co-chair of the U.S. Competitiveness Project, said in a statement.

The study, citing a survey among HBS alumni on the political reforms they thought were needed, found most common suggestion is changing the election process, including steps such as modifying the primary system and shortening elections.

Other suggestions include "limiting campaign contributions from corporations and unions" and "changes to Congressional rules and norms."

As for the U.S. to-do list to enhance competitiveness, the authors put tax reform on the top, while business leaders suggested the top priority should be improving infrastructure, followed by high-skilled immigration reform and streamlining regulation. Endit