Maryan Zablotskyy (Ukrainian Economic Freedom Foundation), Cécile Philippe (Institut économique Molinari), John O’Connell (The TaxPayers' Alliance), Žilvinas Šilėnas (Lithuanian Free Market Institute), and Matt Warner (Atlas Network) on the “The Impact of Reforms Big and Small” panel at Europe Liberty Forum 2017.
Encouraged by Atlas Network’s “Leveraging Indices for Economic Freedom” initiative, the Lithuanian Free Market Institute (LFMI) took up the challenge to implement three changes in Lithuania. First, to reduce time and effort required to get a building permit. Second, to streamline the procedure of connecting new users to the electricity grid. Third, to merge the social security payments by employer and employee into one payment. While this would not actually reduce the effective burden on employees, at least people will finally become aware that in addition to income tax, a third of their earnings are diverted into social security.
This project has provided four lessons for us at LFMI.
One. Pick the right tool for the right job. We always try to make government move to the right (pun intended) direction. But if a government is leftist or center-left, naturally they might not want to implement classical liberal policies. After all, why would a socialist be motivated by ideas of liberty?
However, all Lithuanian governments want to perform well on the World Bank’s Doing Business Index. Presenting policy proposals not through the lens of classical liberalism, but through international competitiveness creates a non-partisan appeal and enables all governments to enact correct reforms.
Two. Block the bad, but also support the good. Completely changing the direction of government is like trying to stop a fast-moving train by standing on the tracks. Plausible, if you are Superman, futile for mere mortals. Everyday government work is a busy station with trains going in all directions. Sometimes we have to throw ourselves on the tracks. Sometimes we should to climb into the driver’s cabin and convince the driver to go faster. Freedom-oriented think tanks surely create value in opposing the wrong policies. But there is also value in helping with the right ones.
Three. Liberty in practice, not just in theory. If you received a 3 a.m. call from the president asking to reform the country, would you know exactly what to do? We challenged ourselves to craft precise policy proposals. Merging of social security payments requires changing five additional tax rates? We need to calculate these precisely. Building electricity lines during winter takes three times longer than in summer? Find out why, find a solution.
We often talk about how to attract people to our cause. Nothing sells better than real solutions to real problems.
Four. Putting up a good fight is good, winning is better. If the government has the same goals as you, if there is no need to fight against public opinion, can we actually deliver a reform? We are so used to lose fighting against overwhelming odds that we tend to assume all odds are overwhelming. But maybe our plans were not good enough? Maybe we lacked proper execution? The mindset where all our wins are our achievements, and all our losses are the governments’ fault has no place on the market. Snap out of it, challenge yourselves. After all, isn’t this what market economy is all about?