Chuck Sheppard is wrong. The following is not “news of the weird.” It’s all too common.
I don’t blame Chuck Sheppard for getting suckered by the idea that “businesses typically resist government regulation.” Most people don’t realize it, but nothing could be further from the truth. Big Business colludes with government all the time. And hardly anyone ever sees it. All we get are stories about political paladins protecting us from this or that evil corporation. The media are suckers. The people are suckers. But behind every lasting regulation is another evil corporation.
The dirty truth is a whole lot of businesses and industries embrace regulation when it suits them. Consider this laundry list, which is not even close to exhaustive.
- Duke Energy has been agitating for carbon taxes. The CEO claims it’s because they’re being good environmental stewards. The truth is Jim Rogers is a shrewd CEO. Duke Energy’s energy portfolio is heavy with nuclear and gas. If a carbon tax goes into effect it will come with a cost. But relative to more carbon-heavy competitors in coal, Duke Energy will make out like a bandit. Taxing carbon dioxide will kick their competitors in the teeth.
- Health insurance companies have long lobbied against interstate purchases of health insurance, which could lower out-of-control premiums. These companies like being regulated. Why? Because in those states where they dominate, they enjoy a veritable monopoly. Why would you rock that boat by introducing competition? Big companies love regulation.
- BIg Food companies lobbied for the monstrous food safety bill Congress passed — a bill which would raise compliance costs and introduce byzantine new rules. Why would they do this? Because Big Food can afford it. Well, guess who can’t? Little growers and suppliers. These are the market upstarts Big Food would rather see with the regulatory bootheel in their necks. The best way to maintain a cartel is to buy yourself some expensive regulations. If you have a cartel, you can always pretty easily raise prices. Screw the little guy.
- Taxi drivers already with licenses love licensing and permitting in cities.
- Restaurant chains love bans on food trucks and street vendors.
- Cosmotologists love licenses because they don’t want competition from unlicensed snippers.
- Big Banks in New York and Charlotte cozied up to Dodd-Frank because it meant they could buy themselves perpetual bailouts and stronger cartelization of banking.
- Unions don’t like cheaper, non-union labor. Labor regulation shores up their cushy jobs.
- Doctors guilds make the costs of entry into the medical profession higher, and they get more business that way.
- Big Pharma is okay with the FDA regulatory process because it keeps out smaller, nimbler competitors.
- Diesel engine manufacturers love regulation on gasoline. Gas companies love regulations on diesel engine makers.
That’s just the tip of the iceberg.
So, Chuck, now do you think businesses typically resist regulation? It depends on what side of the reg you’re on. Our economy is slowly being destroyed by this whole process — whatever good intentions you can point to. Do-gooders will team up with companies to pass legislation as long as the government has the power to regulate. And big players will happily regulate themselves if it will give them an advantage over competitors.
Oh, and guess who picks up the tab for all this? You and me, brother. But most of us aren’t wise to it. As I’ve written elsewhere:
When you spread the cost of any policy over millions and millions of people, the millions have little to no incentive to learn about it or find away to vote against it. Cluster some policy with a bundle of other policies and things get even more complicated and costly. Not for the mohair lobby, however. They’re a one trick pony. And they’ve got millions of reasons to keep good lobbyists on capital hill.
Prices go up, quality goes down, and the special interest state keeps getting bigger. The corporate state will transform the U.S. into the land of opportunity only for people who have an army of lobbyists. And that’s disappointing, especially as the irony is — far from the fantasy of progressives to bringing down big, greedy corporations — big greedy corporations win and get bigger (all at the extense of other companies and consumers). Competition becomes venal and political, as opposed to honest and entrepreneurial. We the people lose.
Max Borders is a writer living in Austin. He also blogs at Ideas Matter.
