Tag Archives: regulations

Corporatism vs. Capitalism

This image makes excellent and foundational points about why increased regulations rarely solve problems.  Why?  Because when you peel back the layers, the large corporations turn out to be the authors and the beneficiaries of the regulations.

There are many ways to do that.  Even in business, requests for goods and services are often subtly tailored to steer purchases towards certain vendors.  The same thing happens in government.  The IRS exceptions or language for certain laws may not mention a corporation by name, but it just so “happens” that the preferred corporation is the only one meeting the criteria.

The winners are the large corporations and the politicians that they essentially pay off during the process.  The losers are the smaller businesses, the consumers and the taxpayers (of course those three overlap in places).

And once regulations are in place then two things are nearly certain: They will never disappear and they will continue to grow.

This also applies to the bailout / “too big to fail” nonsense.  What do you think would happen if you could go to Vegas knowing that you would get to keep any winnings but that taxpayers would pay for any losses?

When in doubt, always go with less government and less regulations.

Regulation overload

Road signs in Mistissini, Quebec, showing stre...

Back in college I was a member of an inter-dorm council (Motto: “As boring as it sounds!”).  At one meeting there was a lengthy discussion about what traffic safety changes to make in response to a girl being hit by a car after walking out from behind a bus.  All sorts of things were considered — signs to slow down, a stop sign, speed bumps, etc.

One person (who might be the heartless author of this blog . . . details from that time period are sketchy) finally pointed out that if people walk out from behind buses without looking, then bad things might happen regardless of how many traffic safety changes are made.  A temporary silence followed, then they moved onto other business.  Yea!

I’m reminded of that when I think of the massive amount of regulations in our society.  I’m no anarchist, but there is a major flaw in the premise that if we just have enough regulations that nothing bad will happen to anyone, ever.  The Law of Unintended Consequences is a nasty thing.  You think you’ve solved a problem but you’ve often created one or more that are even worse.

See the IRS tax code for starters.  It is many times larger than the Bible and even less understood.  They try to close one loophole and create more.  A flat tax won’t be perfect, but it will be far better than what we have today.