[…]Let’s focus instead on a more basic question: why does America have regulators?
If companies always agreed with regulators’ rules, there would be no need for regulators. The very point of a regulator is to do things that companies don’t like, out of concern for the welfare of the market or the consumer. […]
Regulatory capture is so ensconced in our political system, and media is so receptive to the complaints of companies being regulated, that this simple point is often forgotten.
The need for regulation is not relegated to the business world. Professional sports players are the very best in the world at the game they play. Yet somehow they don’t seem to follow the rules of the game all the time and require referees to follow them around and make sure they do. If we felt we could trust them to play fairly there would be no need for referees. But we don’t.
I’ve found this analogy helpful in talking to wingnuts about why there is a need for regulation and regulators.
This is excellent news.
Now, if Holder, et al, will just call the dogs off Neteller and other online e-wallet and payment outlets…
Every time there’s a post here equating lack of regulations with freedom I want to strangle somebody. But I don’t because our society doesn’t allow me the freedom to do so. I’m being oppressed!
Media companies are regulated just as much as in any other industry. It shouldn’t be surprising that they “forget” the benefits of a rule-based market, because it is no accident.
Isn’t it something when a solidly right publication is to the left of the entire American MSM?
That is the same one I use, with the fictional game “Rollerball” as being the libertarian wet dream.
@Violet: Friends of mine will argue that regulations are hurting their freedom while at the same time living in neighborhoods with covenants. It’s okay to be told what color you can paint your house but it’s not okay to protect our food supply.
It’s like those guys in the striped shirts ruining the free market of unregulated football games. If the refs were not there, man, those players could hold and punch all day. What fun!
I believe in deregulation, including removing regulators from engines, plumbing systems, gas supplies, scuba diving, etc. A true free market in compression should not be limited by some liberal blow off valve or the like.
I’ve heard a counter-theory to this. An individual company may not like regulations, like say Enron, because they are cheating but business as a whole wants some known set of rules to operate under.
If Ford Motor Co. is issuing a bond, the companies buying the bond want to know if they will get paid over the life of the bond. If GE is issuing more shares, they want to have some rules in place to know how it will impact the value of existing outstanding shares.
Businesses may not like all regulations and would prefer some just go away, but they do not want an environment where cheaters, like Enron, can bilk them of their money.
It’s really an interesting view. I don’t think businesses oppose all regulations, but they oppose the ones, which keep them from doing “business as usual”. If they’ve figured out how to make money in one regulatory environment, they don’t want serious changes to that environment.
Yeah, I have heard that counter theory also but unfortunately in the last 30 years the facst keep proving it wrong (with the possible exceptions of regulations that lock in monopolies).
You need go no further then the most recent piece of major regulation where dispite the fact that a limited number of banks dominate the derivatives market, and it is widely considered beyond question that those banks excessively charge their customers for such service because the transactions are not reported, yet you had non-banking companies lining up to support the right of the banks not to have to report the transactions which would have brought market discipline to derivatives (and lower profits for the banks and lower cost to non-bank companies). It was a situation custom made to prove that theory yet it proved that the theory is wrong.
Completely unregulated capitalism is a dream and has never existed. It would have never been developed at all without confidence in the contract and with some power somewhere to enforce that contract. And even today if you try to break a contract with a libertarian all hell will break out.
I wonder if your friends have read The Jungle by Upton Sinclair?
Brick Oven Bill
Conservatives like Regulations…
1. gays can’t marry
2. blacks can’t own guns especially black militias
3. foreignors can’t work here but we can work there
4. everyone else should drive 65 mph
There certainly have been times during which “regulations” are designed so as to favor the powerful and harm the common interests. Most obvious being the 19th century monopolies and the widespread use of government forces of violence to shut down strikes, all based upon interpretations of laws and regulations.
People who make such an argument usually take one giant leap from anarchy-like conditions to collectivism, without so much as a simple recognition that there’s a massive middle ground. And even those who make the more accurate but still unconvincing case that regulation allows for capture by the people we were trying to regulate are frustrating. Any time they point this out, I want to scream that we are trying to quell such a problem by limiting campaign contributions and so on to stop the influx of money corrupting the system, but that they are standing in the way.
@Napoleon: Proves my belief that businesses like the status quo, no matter what’s wrong with it.
CNBC keeps telling us that more regulation will hurt the returns of the stock markets etc. However, they never remind it s viewers about the lack of regulation in 2008 and the 40% decline in the SP that year.
@Brick Oven Bill:
This is not BoB. you need to step up your spoof, sir.
The only thing that is important to remember in this discussion is that we just need to regulate such and such and then all will be fine and good with the world. Amiright?
@Linda Featheringill: Completely unregulated capitalism is a dream and has never existed.
Sure it has, and it does. You sell some fruit at the side of the road until the nearest mob boss and his goons drive by, beat the crap out of you and take your cash. It’s all very efficient, you see.
Yeah but it’s the regulations that make the companies not like the regulations. If they weren’t regulated they would, of course, do exactly what the regulations would demand. Right?
What rules and regulations are okay?
Referees = enforcing regulations
Convenants = regulations
Preexisting conditions = Insurance Company Rules
Wardrobe malfunction = FCC regulations
What am I missing?
@”Brick Oven Bill” #12:
Who are you, and what have you done with the real Brick Oven Bill?
I think that some of the problems of liberals versus conservatives is that each assumes the other is proposing to go to extremes. I know that people who talk about the need for regulation aren’t talking about going all the way to forced servitude. I suspect that folks who talk against regulations don’t support the idea of free-for-all-let-the-bullies-destroy-the-wimps competition.
One would think that this little insight goes without saying. But maybe it doesn’t. Maybe we need to say so.
@arguingwithsignposts: Never thought we’d be missing the old BoB…
Hey gene108 and Nick ~
I just saw Rep Boehner say the exact same thing you two chuckleheads were pushing the other day re: businesses not creating jobs because they were scared of what crrraaaazzzyyy regulation Obama the Job Destroyer was going to push next.
Nicely done fellows.
BTW, Boehner is scary orange looking today on MTP. And his background bookcase is made of some orangeish looking wood so it’s really awful.
I don’t mean to sound your average moron following the war but this just makes me so mad because it’s such a senseless waste. I noticed the Taliban killed the 10 person western medical team. A f#$king medical team going to some godforesaken rural bfe place in Afghanistan. Apparently they don’t like white christians helping out rural Afghans. I see them making a great effort to recruit medical professionals from Saudi Arabia/Egypt/Kuwait etc. Wait, I don’t see that happening.
No serious person has ever proposed doing away with regulators for the individual, i.e. cops and the entire criminal justice system, and yet we are expected to take it as a given that corporations, who exist for the sole purpose of raking in as much money as possible, are somehow more inclined to behave honorably. This way of thinking is downright idiotic.
Whenever someone proposes deregulation as the answer to everything, the response should be, “OK, then lets eliminate all the police and prisons, too.”
@Corner Stone: Boehner is starting to look like one of those Scandinavian Bog People mummies. Centuries of brewing in an acidic, anaerobic environment will do that to a person.
@arguingwithsignposts: This new Brick Oven Bill also comments at Wonkette. He is totally kick-ass; I say we keep him.
@demo woman: Rules and regulations regarding what a woman can do with her reproductive organs are fine, all others must be done away with.
@beltane: you call what he posted on this thread kick-ass?
@Linda Featheringill #23:
Linda, I think this is a really important insight. It’s the extreme examples and anecdotes and hypotheticals that drive much of both the media narrative and the political debate. Just as the middle class is being squeezed out of our economic structure, so the middle ground is being squeezed out of our policy dialogue. Well caught! And yes, we *do* need to say so, often and forcefully.
@beltane: where you encounter a contradiction draw a distinction: those aren’t rules and regulations, they are manifestations of good old Merkin morals and values.
And from that well known pinkish liberal rag, The Economist too!
Next The Wall Street Journal will concede that the market for health care does not in fact conform to the idealized picture of a free market taught in Ec 10….
….nah — never happen.
Davis X. Machina
It’s still the same old story, a fight for gelt and glory.
taxregulate me, Taxregulate the guy
Behind that tree.
It’s special pleading. Period.
Chad N Freude
@arguingwithsignposts: This happens every once in a while. I am convinced that DougJ does this. I’ve challenged him a couple of times, and he’s never responded (more accurately, I’ve never seen a response.)
Chad N Freude
Just in case that wasn’t snark (hard to tell, since it seems to be snark directed at pro-regulation): No, we need some degree of regulation and enforcement to minimize the risk of something damaging happening.
@jwb: Some of his stuff on Wonkette is very, very funny. When he reverts to launching a diatribe against women drivers I promise that l won’t be feeling the BOB love.
Chad N Freude
I think the criticism of The Economist is unwarranted. It’s a conservative magazine, not a US Conservative magazine, and generally takes reasoned positions (whetehr I agree with them or not). I’ll continue to believe this until somebody posts a link to an Economist attack on the British health care system.
Belafon (formerly anonevent)
Businesses don’t care about either of those. Their entire job is to create profits for their shareholders. Of course we need someone out there whose job is to monitor what they do.
Eric, what say you?
Similarly, the people who argue that unions are “no longer needed” apparently believe that if unions disappeared, all labor protections would continue via the natural grace, hearty goodwill and proven probity of management.
That’s what I keep hearing over here on the left as well.
Chad N Freude
@Corner Stone: At the risk of repeating myself (which I often do here): @Chad N Freude
Or maybe management will threaten and intimidate the employees who are left, and pit the individual against the rest.
@Chad N Freude: I’m sorry Citizen, but your rather lukewarm “some regulation is needed” is insufficient in both vigor and scope.
We need to regulate such and such and all will be a paradise.
@demo woman: well that’s easy, most anti-regulation people think government regulations of corporations outside of contract enforcement are bad but that the regulations in contracts entered voluntarily by humans are A-OK. This usually accompanied by thinking corporations are extensions of an individual and there are no duties to anything more than the individual
@SiubhanDuinne: Except Republican leaders have called for the extremist step of getting rid of all regulations. Tom Delay said there were not any federal regulations that he would choose to keep — he entered Congress because of his hate for regulations of his extermination business. WHile he didn’t clarify this much, this would mean no child labor laws and possibly slavery (or at least indentured servitude) being brought back
Chad N Freude
@Corner Stone: So you don’t believe in risk analysis to determine an appropriate level of regulation? I think that the Wall St regs that were in effect prior to the Great Bush II Uprising Against Regulation were realistically based on recognized risk factors, and they seemed to work reasonably well. The destruction of the regs ignored all risk factors and resulted in the Free=Anarchic Market that followed. I’m not sure why you consider “some regulation” to be lukewarm. How much regulation would be warm, hot, boiling? It is possible to over-regulate. Even taking into account the the political bias of this report and – FMS help us – Ed Morrisey as a source, over-regulation in CA is a real issue. (It took between three and four months for a small restaurant near me to receive all of the permits needed to move to a larger already-existing restaurant building across the street.)
@Chad N Freude: The point: missed it, you did.
@Chad N Freude:
Of course not. I am on The Left. I say, and also keep hearing all the time, that if we regulate then everything will be resolved favorably.
@Corner Stone: Regulation, regulation, and when in doubt, more regulation!
Regulation today…regulation tomorrow…regulation forever!
Regulation uber alles!
Shall I continue? ;-)
Also, too, wik: Why aren’t people willing to address the danger that is Inflation? It’ll be the death of us all!
Chad N Freude
@AhabTRuler: Yeah, well, I missed a couple of days of BJ due to circumstances within my unexercised control and missed this. But now I’m totally unable to differentiate between a serious discussion of regulation and trollish gotcha snark.
ETA: I’m lookin’ at you, Corner Stone.
@Chad N Freude:
@Chad N Freude: Internet traditions. Someone is unaware of them.
This is clearly a case of small rodents gamboling about in the absence of a feline. Corner Stone and Ahab, sirs, would you two be quite so brazen in your coarse mockery if there were a chance in hell of the mockee ever getting around his firewall and fecundity to read the comments? Huh? Huh?
@shortstop: Er, fuck him in his tired conservative talking points-hole. Many have tried to post substantive critiques, only to be met with crickets. Apparently Mr. Kain (and others’) firewalls also block those comments, too. Christ, this is where I come for warmed-over centrism only moderately defended by logic and constancy, and that’s the way I likes it.
Also, too, wik: If i wanted warmed over conservatism undefended by logic and constancy, I can renew my subscription to the WaPo, thanks.
That’s kind of a harsh thing to call his kids, don’t you think?
And sure, I don’t dislike the guy a bit. If I met him in real life I’d put down my cane long enough to shake his hand and tell him his efforts to this point suck. And why.
Ahab: Was joke. I still can’t believe the guy thought it was a good plan to blog without reading comments. But I believe I am now at risk of becoming grossly repetitive on that point.
@shortstop: The extra “huh?” sold it. At least I thought so.
I’s knowz it. Twas a touch more vituperative that I am normally given to, and I have no interest in defending the sanctity of Balloon Juice. Let the hack post, FAIC, but I do think the tendency to ignore the substantive criticisms to be…interesting.
FWIW, if I ever thought that BJ was really starting to suck, I would drop it like a steaming turd, and I would skip the GBCW post. After all, it’s only a blog.
@Corner Stone: It’s not a theory I’m pushing. It’s what people I know, especially in the NYC finance / banking world, are telling me. These are relatively left-leaning people on social issues, who usually vote for Democrats.
I can understand businesses holding back money, if they cannot charge as much to employees to off-set the cost of health care, for example or if the minimum requirements of the new health care law will cause plan prices to increase. Or at least budget for anticipated cost increases because of HCR, until actual guidance about how the law will effect them gets issued in the future.
Some of actions of business seems to be some degree of paranoia or games-man-ship to try and tilt things more to their liking. Paranoia because they are convinced there are tax increases lurking in every bill, which isn’t the case, if they stopped to look at the Congressional docket. Games-man-ship because they don’t want to deal with changes in how they operate.
This isn’t a narrative that’s being pushed. This is what’s happening right now in this country.
There should be an intervention between the Obama Admin and the business community, so everyone understands whats going to happen next, but I just don’t see anything like that happening. The more businesses dig in and don’t invest the more anti-business saber rattling will come from D.C. and then the more businesses will keep hording profits and the more the White House and Democrats will decry the evils of big business and a vicious, unproductive, cycle is born.
@gene108: Glad to hear that the Masters of Industry and Finance are using their business sense and logic to make decisions. Clearly, that is why they deserve their over-large salaries.
Chad N Freude
Oh, I think the the “business community” understands quite well what’s going to (i.e., may) happen next. They’re doing everything they can to prevent it.
@gene108: But there is clearly a narrative being pushed. Why do you think Boehner said it on MTP?
Do you think, for one moment, he ever says anything on a national program that isn’t to further an agenda? Those 3 minutes are precious.
Of course it is a bullshit narrative. They are using propaganda and massive PR to push it.
@AhabTRuler: Any other straw men you want to put up there?
I haven’t ever seen somebody on “the Left” say that all we need is regulation for the sake of it (that’s the scarecrow you keep putting up there. If it’s El Cid-style snark, it’s a total failure). I’ve had arguments with wingnutz who think any taxation is bad, until you point out to them that some is necessary; then we’re haggling over the amount. Some principle.
And inflation? Okay, you’re such a great economist, why are you worrying about inflation when we’re in danger of deflation? Just throwing it out there as another talking point?
Better trolls (or better snark, if that’s what’s being attempted here), PLEASE!
It’s only “forgotten” by conservatives, Randians, glibertarians and corporatist Dems. But nice to see The Economist point it out yet again…