Dear Friends,
It seems to me, government regulation has the unique ability to get all the bad things from capitalism, excluding the good. From monopoly to regulatory capture, government abets the worse aspects of free markets, while suppressing the feedback mechanisms. Its really very clever. Bureaucrats are tasked with giving a politically favored party a leg up, in an otherwise fair transaction. Which results in the politically favored taking advantage of the politically disfavored. Leading to an economy where all the worst aspects of free enterprise are encouraged and the good ones suppressed. Then the elite doing the regulating can claim capitalism doesn’t work. While pointing at the outcome they created with regulation as proof. Hegelian as can be. No wonder Schopenhauer thought Hegel a fraud.
Regulation is always sold as a good. It will help the weak. When it always results in exactly the opposite. Regulation benefits the strong. Who help write it, have the lawyers to get around it, and the political favor to exploit it. Small business that has none of those advantages is then strangled by those regulations. Opening the way for corporations to build monopolies. Even as regulation designed to protect the public, enrich the corporations, that failed to protect the public. As in the case of ATMOS in Texas. Who’s ineptitude killed some folks, so the regulators gave ATMOS a base fee. A monthly fee that goes up every year. Today that base fee is nearly $50.00 a month! Before you buy a single CFM of gas. Now that’s how you do it. Money for nothing and chicks for free.
In my opinion the logic of collective action by Mancur Olsen describes how people react to regulation. That regulation might raise the cost of sugar a bit for us but increases the profit of the sugar industry by tons. A regulation might charge us a monthly fee to simply be connected to the grid, but that monthly income is gigantic, to ATMOS and other such politically favored companies. Even as the inconvenience of having to go to a corporate store, instead of a local one because regulation closed the mom and pop, might make us grumble, but won’t get us to write our congressperson. Though the tons of money the sugar industry rakes in, the immense monthly income the corporate executives get in bonuses and the elimination of competition is sufficient to get corporations to opulently spend on lobbying.
The same people who erase the free market’s feedback mechanisms through regulation, claim we need regulation, to protect us from free markets. While they lock us into monthly charges, as they claim to be protecting us, from gas leaks and electrical outages. Exploiting the predictable negative results to claim free enterprise doesn’t work. Then con us into accepting more regulations to solve the problems created by the earlier regulations. Which makes me think they’re using their authority to get more authority. An action that most everyone can agree is self serving. Moreover, it robs the wealth of the nation, giving it to political cronies and corruptocrats. Creating a negative feedback loop. Where the corrupt regulate to damage, use that damage to justify more regulations, enriching them all the while.
The hypocrisy is strong with the regulation crowd. They claim they are regulating for our good. While the only ones who benefit are the politically favored. Each regulation suppressing some good aspect of capitalism while polishing some bad facet. Then in true Hegelian fashion the regulators exploit the result to justify more power. The regulators get away with this scam because of the logic of collective action. In each case we’re harmed but not enough to do something about it. So we grow accustomed to pain. As the regulators grow accustomed to luxury. Certainly, there needs to be standards, but not regulations. If an inch were a regulation, it’s length would depend on who’s benefited. Regulations are a con, sold to us by the good it won’t produce, resulting in wealth and power for the favored.
Sincerely,
John Pepin
