Minor point: simplified characters weren't intended to make Chinese easier to read (which is good, since they'd be a miserable failure at that). They were intended to make it easier to write (by hand!) -- the idea was to reduce the number of strokes used to write common characters, and the accompanying propaganda was to the effect that using simplified characters would cut a piece of typical text from so many strokes to so many (less) strokes. Characters were targeted for simplification not based on how ungainly they were but based on a combination of how many strokes they required with how frequently they were used.

Then the advent of computers and typing made stroke count mostly irrelevant.

It is interesting to ponder how much the world would have been different if the PRC had just gone all the way to Pinyin when they decided to simplify the writing system.

Also interesting: the linguist who developed Pinyin is apparently still alive at age 108 -- http://en.wikipedia.org/wiki/Zhou_Youguang

How does that show it? In a developed country, even if literacy is more difficult, we'd expect the education system to have compensated or calibrated for it to achieve an overall good rate. If schoolkids must spend an extra 10% overall time due to increased literacy requirements, that's really but gonna show up on the overall literacy rates, right?

If that doesn't show up on literacy rates, or GDP, or crime rate or... can you really consider it a hindrance?

Sure! For instance, more kids might commit suicide due to increased stress. In response, more people may work harder, and culture might shift to view this as virtuous thing, so those general numbers might still fair alright.

If one factor isn't so terrible that is overcomes all advantages of a wealthy educated society, can you really consider it a hindrance?

Taiwan has a much higher rate of english speakers as well. Hence the higher literacy rate.

Literacy rate has not much to do with English speakers, as speaking English does not help people read and write Chinese.

I think that radical simplification is just a joke. It is not possible to replace logograms like Chinese completely with phonograms like Hanyu Pinyin or English without considering the grammar and the culture. Chinese has its own flexibility for writing/speaking/thinking.