Principle #7

Principle #7 - Long term growth is based on two factors:
1) What you've got [inputs: a) Natural resources b) Infrastructure ]
2) How you use it. [a) Human capital]

What is important here is that you don't see the three industries that appear in Principle #4. You don't promote long-term growth by making taxation, regulation, or litigation part of an economic plan. Every time Washington gets involved in the economy they do something that squanders the above inputs and increases the prevalence of higher or hidden taxes, regulations, and litigation.

For example, when a piece of legislation like the economic stimulus bill gets passed, it doesn't address energy prices - i.e. drilling for more oil (natural resources), it actually hikes taxes on people and businesses making over $250,000 - job producers (increasing human capital).

Therefore in order to grow the economy "long-term", you need to maximize your resources, human and natural, and stay away from policies that allow the cancers of taxes, regulation, and litigation to infiltrate the economy.