Monday’s Mtg: Do We Need More or Less Regulation of Business In America?

This one was Dean’s idea, and I think it’s got a lot of potential. Dean said he wanted us to explore the arguments that having “more” or “less” government regulation of business would solve a lot of our problems because that is the simple way the right and left often talk about the topic. Fewer regs = good = more freedom. Or, More regs = good = control evil corporations. To be sure, it is hard to debate such vague, I-love-my-ideology slogans. But regulating business to ensure that markets function smoothly and t protect the public interest is a core function of govt. Not to mention, we’re living in a country where presidential candidates promise to build 3,000 mile fences and turn us into Denmark, so I don’t think any proposal is too simplistic to merit our attention.

Now, we all know that there is no such thing as a completely unregulated market. In any market the public sector is there to help set and enforce the rules; police fraud and protect the rights of consumers, workers, and owners; provide and maintain the public goods that markets rely on, etc. As an article I’ve linked to before put it, Markets Are Not Magic.

But IMO, even the simplest slogans for reduced less government regulation raise key and complicated issues. Regulations always impose costs on businesses and often on workers and consumers, too. Some of those costs are easy to measure and to compare to the regs’ benefits. But, other costs are hard to determine and much harder to predict, like when regulation stifles competition and innovation, protects the powerful at everyone else’s expense, distorts prices and investment decisions, and erodes our companies competitiveness internationally. The way I see it, our topic is more like two questions.

  1. How can we know the true benefits and costs of government regs and therefore whose interests they really serve?
  2. How can we make govt regulation flexible enough to be effective and efficient as our economy rapidly evolves in the future?

I’ll explain what I mean a bit more in my intro on Monday and then ask Dean for his thoughts. CivCon has had several recent meetings related to govt regulation. (Aug ‘15 Is Big Finance finally tamed? Dec. ’12: What’s holding back small businesses? Feb. ’13: Religious conscience exemptions.) So, I’ll be brief and non-industry specific. I will, however, take the time to highlight the above and a few other important problems/issues facing federal and state and local govt regulation going forward.

Discussion Questions –

  1. What justifies govt regulation of business? What should be the goals?
  2. How (and how well) do they calculate the benefits and costs of regs? What factors, other than the raw $$$, should be considered, and whose voices are heard and not heard?
  3. Which govt regs are the most and least popular with (1) the public, (2) workers and consumers, (3) entrepreneurs and small biz, and (4) big corporations? Any common villains or inevitable conflicts of interest?
  4. Which regs do Republicans/Democrats want to repeal/add/change? Why? Why really?
  5. What needs to be done to keep regulation effective and efficient as our economy evolves?

SUGGESTED BACKGROUND READING –

What Do People Want?

  • Public opinion: By a 2 to 1 margin, Americans favor the POV that there are “too many” govt regs on biz rather than “too few.”
  • But, notice that people like most specific regs and strongly approve of the their goals.

Asking the Right Questions

Benefits and Costs of Govt Regulations –

We Need FEWER Govt Regs –

No, We Need MORE Govt Regs –  

21st Century Regulation –  [longer and harder, but key]

Next Week: Trumpism – What is it and will It will outlast him?

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2 responses

  1. James H. Zimmerman | Reply

    Many Republicans seem to view the 19th century, the era of laissez-faire, when indeed there were few government regulations, as a sort of golden age to which they desire to return.
    So it might be worth pointing out a few things which happened then which, indeed, gave rise to the modern era of regulation:
    Some of Andrew Carnegie’s steel workers went out into the world in the steel ingorts, into which they had fallen during the dangerous process of making steel.
    Little or no compensation was paid to their families.
    (Incidentally, they also worked 364 days a year, 12 hour days, 7 days a week).
    In 1906, Upton Sinclair published The Jungle, which detailed conditions in the Chicago stockyards and some of the things which went out to the world as “Armor’s potted meat.”

    Now we have the FDA.
    “I aimed at the public’s heart, and hit its stomach,” said Sinclair, who was a Socialist like Bernie Sanders (and me).

    One could go on and on with such a list. Regulation did not happen because anyone wanted it as such; it was absolutely necessary.
    Are we over-regulated? Perhaps we are, in some areas.
    But the idea that we could go back to an era of no government, is simply insane.

  2. This would have been my #1 link, but it was behind a paywall until a week after our meeting. It’s about the importance of bringing back anti-trust law enforcement.

    http://prospect.org/article/bring-back-antitrust-0

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