Barack Obama looks at a portrait of James Madison

Two hopeful signs in the last week actually illustrate the political obstacles to sorting out America’s moribund economy.

President Obama negotiated a deal with Republican leaders in Congress to extend Bush-era tax cuts, while a bipartisan commission on deficits set up by the President agreed to support some good ideas.

Tax cuts and deficit reduction would certainly help the economy in their own right, but their real significance would be that they would show that the US government has an agreed and stable policy in which investors and entrepreneurs could have confidence for the next few years.

Alas, that seems unlikely in practice. The price of extending the tax cuts is extending unemployment benefits – a political necessity but one which goes against the other objective, of cutting the deficit. The deficit reduction plan itself looks like a dead letter.

The problem is the way the US Congress works. This is a simplification, but in most other countries, the legislatures simply vote “Yes” or “No” on spending requests put forward by their governments; in the USA, individual legislators, Senators and Congressmen, can put their own spending proposals to the vote. They have every incentive to do so: spending someone else’s money, especially in their own home State or District, buys votes. They also have every incentive to help each other: Senator X will support Senator Y’s spending proposal because he needs Y’s support for his own.

No one has any incentive to be financially responsible. In other developed nations, that responsibility rests clearly with the government, the executive, and the legislature serves only as a check, but in America the legislature takes the initiative – and takes the country in several different directions at once.

This problem is rooted in America’s Constitution. When an idealistic bunch of lawyers, James Madison and Co, drafted the Constitution in the 1780s, the young Republic was a decentralised, mainly agrarian, confederation, with no idea what the future might hold. The main concern was to appear democratic and avoid strong centralised power or anything that resembled monarchy. The world has changed dramatically since then – and strong centralised power has developed by default to cope with it – but the Constitution has not changed to reflect that.

Nor is it likely to change: Americans revere their Constitution – but every businessman knows that you cannot run a major 21^st Century organisation with an 18^th Century management structure.

We become entrepreneurs because we love freedom. That means making our own choices – which means taking responsibility for the consequences of those choices. A choice without consequences is not really a choice.

This applies both to business choices and to personal choices. We cannot defend our right to make our own business choices without defending the rights of others to make their own personal choices, such as the choice to have children. However, just as we take responsibility for our business choices as entrepreneurs, those who choose to be parents must take responsibility for their personal choices.

So it is unfair for anyone to choose to have a child and then expect someone else to take responsibility for the consequences.

Yet that is exactly the effect of maternity and paternity leave. An employee makes the choice to have a child – and would, quite rightly, object to any employer interfering in that choice – and then forces the same employer to bear some of the consequences of the same choice.

The poor employer has to suffer the negative consequences without enjoying any of the positive things usually associated with making children!

Even where the employer can reclaim the employee’s salary from the state – which is not always the case – the business must cope with the disruption of an employee being absent for a prolonged period without the option of hiring a permanent replacement. It is also unfair to any temporary replacement.

However, there are more employees than employers, so politicians seem incapable of resisting any proposal to extend maternity and paternity benefits, however unfair, uneconomic, and – in an overpopulated world – unnecessary they might be.

So it is no surprise that the European Parliament has voted to increase maternity leave. The lives of politicians in general are themselves another example of the power to choose being divorced from responsibility for the consequences of those choices. They can impose any burdens on business safe in the knowledge that it will not impact on their own daily existence – a privilege they exercise without restraint.

We become entrepreneurs because we love freedom. That means making our own choices – which means taking responsibility for the consequences of those choices. A choice without consequences is not really a choice.

This applies both to business choices and to personal choices. We cannot defend our right to make our own business choices without defending the rights of others to make their own personal choices, such as the choice to have children. However, just as we take responsibility for our business choices as entrepreneurs, those who choose to be parents must take responsibility for their personal choices.

So it is unfair for anyone to choose to have a child and then expect someone else to take responsibility for the consequences.

Yet that is exactly the effect of maternity and paternity leave. An employee makes the choice to have a child – and would, quite rightly, object to any employer interfering in that choice – and then forces the same employer to bear some of the consequences of the same choice.

The poor employer has to suffer the negative consequences without enjoying any of the positive things usually associated with making children!

Even where the employer can reclaim the employee’s salary from the state – which is not always the case – the business must cope with the disruption of an employee being absent for a prolonged period without the option of hiring a permanent replacement. It is also unfair to any temporary replacement.

However, there are more employees than employers, so politicians seem incapable of resisting any proposal to extend maternity and paternity benefits, however unfair, uneconomic, and – in an overpopulated world – unnecessary they might be.

So, as if the recent stupidity of the Equality Act wasn’t enough, it comes as no surprise that the European Parliament has added more poison to the chalice by voting to increase maternity leave.

The lives of politicians in general are themselves another example of the power to choose being divorced from responsibility for the consequences of those choices. They can impose any burdens on business safe in the knowledge that it will not impact on their own daily existence – a privilege they exercise without restraint.

Can it get any more stupid? Sadly yes it can and yes it will.