Wednesday, December 31, 2008

state regulation is worse than no regulation

in an email the other day, a friend sent me this cartoon. i like the idea here illustrating the nature of the corporate state, or the fascist economy of the u.s. politically connected companies can basically throw the rules of business out of the window, because they have the state, handing out other people's money, to keep them afloat at all times. if we can't make a product you want to buy, we'll simply have the government force you to give us your money. so, not only do we get crappy products from companies that no longer have to bear the burden of competition and innovation to remain alive, but we also crowd out any companies rising in the wings that may be better suited to the business at hand than the established bureaucratic regime.

what i don't care for is the 8th frame of the comic. it implies that companies will harm their customers if regulations don't exist to stop them. this is totally false. competition in the marketplace is the best way to insure that the incentive exists to make products and services as safe as possible. companies supplying harmful goods and services will always be bypassed by competitors with better safety records. this doesn't take into account the legal liabilities of companies that use fraud to convince people to buy unsafe goods. of course, there will always be careless folks and fly-by-night companies that will get together with bad results, but there is little way around that. in human society, there will always be problems.

those who know best how to regulate business are those in the industries themselves. no far away bureaucrats with no interest in the companies they regulate are ever going to able to know what the best way to conduct the various businesses in the various industries is. the market, no matter how many pro-state wingnuts preach the contrary, is a self-regulating entity. we will always, on the whole, go for the best quality at the best price. we will not, of course, continue to buy harmful products from companies, especially if there is a safer competitor out there.

so, forget the ridiculous, arbitrary, regulatory state and believe in yourself to make the best decisions for you, based on your subjective values.

we are the market.

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