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Big government and high taxes are killing American entrepreneurs and small businesses, our public schools are failing to properly prepare future generations and the United States has no clear economic strategy to reverse its slipping competitive position in the world, according to a scathing report published in Business Week by Harvard competitiveness expert Michael Porter.

A damning indictment of Washington’s gradual shift toward socialism, Porter’s report lays out a bleak prognosis for an economy already on the precipice, saying that “what has driven America’s success is starting to erode” due to “a series of policy failures.”

Here’s just one of several excerpts from Porter’s report that should show you how utterly clueless our politicians and bureaucrats have become …

Federal polices have hobbled America’s entrepreneurial strength by needlessly driving up the cost and complexity of doing business, especially for smaller companies. Cumbersome regulation of employment, the environment, and product liability needs to give way to better approaches involving less cost and litigation, yet special interests block reform. The U.S. has become a high-tax country not only in terms of rates but also administrative hassle. Infrastructure bottlenecks, due to neglect and poorly directed spending, are driving up costs in an economy increasingly dependent on logistics. The U.S. is energy-inefficient, but public policies fail to promote energy conservation. Health-care costs are too high, but there is no serious effort to provide more integrated and efficient care.

Collectively, these unnecessary costs of doing business, coupled with skill gaps, are becoming significant enough to drive investments out of the country, including investments by American companies. Instead of addressing the real reasons for offshore investment, the parties spar over closing tax “loopholes,” even though U.S. corporate rates are among the highest in the world. Where is the strategic thinking?”

Sadly, there is strategic thinking … but it’s all devoted to spinning government’s failure so that the “other party” is to blame, when clearly both parties have failed miserably to protect taxpayers and promote prosperity.

In addition to our excessively high tax rates, Porter’s report also shows America’s deteriorating position with respect to other key measurements, including an innovation gap, clumsy trade policies, and – not surprisingly – a pathetic public education system …

All Americans know that the public education system is a serious weakness. Fewer may realize that citizens retiring today are better educated than the young people entering the workforce. In the global economy, just being an American is no longer enough to guarantee a good job at a good wage. Without world-class education and skills, Americans must compete with workers in other countries for jobs that could be moved anywhere. Unless we significantly improve the performance of our public schools, there is no scenario in which many Americans will escape continued pressure on their standard of living.

Porter’s report blasts both parties as being part of the problem, and points out that the last time America created a global competitiveness council was under the Reagan administration twenty-five years ago.

Ordinarily, we’d say it’s time for another one, but when was the last time Washington politicians did anything with common sense recommendations?

Both in DC and in state capitals across the country, leaders of both parties have embraced unsustainable spending, higher taxes and reactionary political correctness as their guiding principles of governance – with devastating consequences on American families and small businesses.

And while it’s clearly time to shed such “beliefs,” it’s tough to do that when both parties are hopelessly beholden to the status quo special interests perpetuating the problem.