The new design of American government should rest on ten key principles.

A popular joke at the University of Chicago goes like this: "That's all well and good in practice, but how does it work in theory?"

Soon we delve into how the new approach to economic security and an effective market will work in practice. Those policy details do not emerge out of the blue, however, nor do the details stand in isolation.

Rather, the thread of theory weaves the policy details together. Ten basic principles underpin the specific reforms spelled out here, pulling them into a unified structure and aligning them. These principles both justify the policy details and illuminate how they sync up.

Distinct but reinforcing, the following ten principles create a  blueprint for re-designing American government.  They cut across government's interaction with three of our biggest public relationships: with work, with the market, and with government itself.

First Principle: A Focus on Adults

Adults should be the essential "unit of policy" when it comes to putting government in its place.

It is helpful to pay attention to the impact of policy on other groups--on children, seniors, urban and rural residents, racial and ethnic groups, and economic groups like the poor, middle class, and rich.

But in formulating policy itself, the starting point of policy should be adults. Everything flows from there. Children are the children of adults. Seniors are older--often retired--adults. Adults happen to live in cities or small towns; happen to be white or black or Hispanic; and happen at any particular time to be poor, middle class, or rich. Adults' relationships with work, the market, and government are the context of virtually all public policy.

Second Principle: The Primacy of Work

The link between adults and work should be the driving force behind the greatest swath of public policy.

Human beings are programmed to work. "Six days shalt thou work and do all thy labor" is not a mere suggestion or a helpful hint. It is the Bible's commandment, buried in our DNA and drilled into us by religion and culture. To be human--certainly to be an American--is to want to work and be expected to work, if at all possible and for many decades.

A central pillar of government policy should therefore be to make work available...make work pay...support work...care for those who cannot work....and guarantee those who worked for decades a comfortable retirement.

Third Principle: A Decent Income

Government policy should ensure that the income that Americans derive from full-time work, or from disability benefits or Social Security, is always sufficient to lift them well above the poverty line.

Fourth Principle: Equality of Access

If freedom is Americans' most cherished value, equality comes in a close second.

All Americans--except those in prison--should have equal access to the nation's core programs of economic security and equal opportunity.

Such programs should not be limited to narrow "targeted" groups. They should not be based on prior criminal conduct, poverty, income, assets, race, gender, or any other irrelevant factor. The middle class and rich should not be shut out, any more than they should get preferential treatment.

Fifth Principle: Honor and Incentivize "Normality"

Americans by and large have "normal" values.

• We care deeply about freedom and equality
• We like to tell the truth and play by the rules.
• We accept responsibility, and expect others to do so as well.
• We honor work, and want to support ourselves by working if we can.
• We want to live by the earnings we bring home.
• We believe that if you work hard, you should be better off.
• We believe that marriage--who, when, and why we wed--is a personal matter.
• We also believe that marriage should not be discouraged by government.
• We recognize that it's our obligation to pay the true price of the things we buy
• We understand the need to pay our fair share of taxes.

Public policy should respect and encourage these normal values and incentives, not stigmatize or undermine them.

Thus, government should enact programs that make work easy to find, easy to keep, and economically rewarding. It should always be advantageous to work more hours and earn higher wages.

Government programs should likewise be designed to eliminate any perverse incentive to (1) lie and cheat in order to qualify for any form of assistance, (2) avoid work, or (3) avoid marriage. Ending "poverty-requiring" welfare programs will go a long way to doing away with these perverse incentives.

It is important to design disability programs to make it easy for those with genuine physical or mental disabilities to obtain monthly payments that lift them out of poverty. At the same time, those claiming or considering disability status should always have a clear incentive to work in wage-paying jobs that (1) replace existing disability benefits at a higher income level, or (2)  deter them from "going on disability" to begin with because employment pays better.

Once all Americans have a decent income that makes it possible to pay market prices, government should avoid policies that artificially cheapen the prices of any products or services.

Nor should government create a tax system so unfair, complex, and burdensome that it undermines our commitment to pay our fair share by convincing us that "the other guys"--probably richer than we'll ever be--are sneaking out of their responsibility.

Sixth Principle: Individual Freedom and Options

Government economic security programs and market policies should favor individual freedom and options.

Within the new economic security structure, policy should provide options whenever possible. 

Similarly, policy should favor options in health care (choice of insurance plan and choice of doctor) and control in education (choice of curriculum and school), as long as rigorous quality standards are met.

Freedom and options should also drive the market. Individual Americans and businesses--not Congress or cartels--should decide what's bought, what's sold, what things cost, and the market's current contours and future course.

Seventh Principle: Fair Competition

Good public policy also means using competition, wherever feasible, to extract the best public outcomes from contending--often private--organizations.

Eighth Principle: Clear Governmental Accountability

Putting American government in its overall place also means putting each level of government in its proper place.

Today, the three major levels of government--local, state, and federal--are hopelessly tangled. In several major areas (transportation, economic security, welfare, health, and education) everybody's in charge, which of course means that nobody's accountable.

Government works best when, instead of multi-government oversight of a multiplicity of programs, a single level of government is fully in charge of a distinct set of programs. Bart Simpson's evasive motto, "I didn't do it," can then give way to Harry Truman's pledge: "The buck stops here."

This redesign of government assigns virtually all government programs to a single level of government.

Ninth Principle: Simplicity in Government

Simplicity is another key principle that should govern government.

The vast array of governmental programs, especially at the federal level, is bewildering. Many serve the same core purpose, but have different target groups, different structures, different rules, and different funding streams.

The governmental stage should not be so complex. Government should operate a much smaller number of essential programs. The structure of its core remaining programs should also be simplified (especially by ending "means-testing"). The delivery of government's economic security and equal opportunity programs can be further simplified via the creation of Individual Progress Portfolios.

Tenth Principle: Fair, Simple, Low Taxation

Finally, the American system of taxation--especially the federal income tax--needs to be made fairer, simpler, and less burdensome.

The current system places an unfair burden on ordinary Americans' earnings because of its  favorable treatment of the types of income mostly realized by the wealthy.

The numerous exemptions, deductions, and credits make the tax system maddeningly complex.

Finally, the tax system's loopholes deprive individual Americans (whether poor, middle class, or rich) of the power to freely control our nation's culture and economy by steering resources towards those activities that the government has decided deserve to be subsidized.