Regulation: Used by The Powerful Against the Weak

[Crazed Rabbit]

In this case, the business in question is transportation:

NASHVILLE, Tenn.-- In June 2010 the Nashville Metropolitan City Council passed legislation raising the city's minimum fee for limo and sedan rentals, bumping it from $25 to $45. Drivers were prohibited by law from charging less. Other new regulations forbid limo companies from using leased vehicles, require cars to be dispatched only from the place of business, compel companies to wait 15 minutes before picking up a client, and ban parking in front of hotels and bars to wait for customers. More laws that take effect in January 2012 would also require companies to replace all sedans and SUVs over seven-years-old, and all limos 10-years-old and older. Vehicles older than five years cannot enter into service.

Passed under the guise of consumer protection, the net effect is to give large, existing car companies (also known as livery services) a huge advantage over smaller companies, and to effectively prevent any new companies from entering the market. Prior to the new laws, Tennesseans could purchase transportation from downtown Nashville to the airport in a limo or sedan for the same price as an average taxi ride. Nashville residents and visitors will now pay almost double for the same service.
...
Wesley Hottot, an attorney for the Texas Chapter of Institute for Justice, a non-profit libertarian law firm, says the Tennessee Livery Association (TLA), a coalition of expensive limousine companies, pushed the bill through with a number of provisions that benefit only its members. “There is no point in this regulation. It has nothing to do with public safety. It has everything to do with economic protectionism,” Hottot says. Hottot and his team have litigated similar cases involving economic liberty and property rights in federal and state courts across the country.

Such minimum charges for non-taxi car services are common all over the country. In Austin, Texas for example, the minimum fare of livery vehicles is $45, in Houston it's $75, and in Portland, Oregon, the fares must be 35 percent higher than the prevailing taxi cab rate. Little Rock, Arkansas companies can charge no less than $50 for limousines, no matter how long the ride, and no less than $30 for SUVs and sedans.

Regulation is often, not just rarely, a tool of the powerful - people or corporations - to use governments and politicians against their competitors. The only answer is forbidding the government from such economic interference in the first place.

CR

[Papewaio]

Restraint of trade, cabal by law, anti-competitive etc surely this would break Federal Laws.

Who benefits that a premium quality most come at a premium?

This is a small scale version of corporate welfare. Protecting companies when it should be about allowing fair competition not raising artificial powers to stop it.

[PanzerJaeger]

The article makes a good point about regulations - they are almost never written with the people's best interests at heart. I feel like a lot of people on the political left have this idea in their head of a hardworking, underpaid government bureaucrat pouring over charts and graphs trying to figure out what the most beneficial, equitable solution is to a particular public policy issue when in reality regulations are usually direct copy/pastes given to them by industry lobbyists.

[a completely inoffensive name]

Removing government from business isn't a solution though. Ultra free markets are failures. You need something to make sure companies don't pollute otherwise the externality starts causing problems. You need something to break up monopolies so that people are not abused. This is all government being involved in the free market. Any body trying to say that it could work differently without government should talk to a Communist who wants to inform you that Communism just hasn't been done correctly yet.

@PJ what you say is true, but instead of simply cutting the nose to spite the face we must recognize that maybe we shouldn't let industry have lobbyists in Washington in the first place.

Let's say that companies have no voice in government, and the government in turn becomes the new Soviet Union (BECAUSE IT COULD HAPPEN RIGHT?). In the end, the economy will suffer and the politicians will recognize that somethings are too harsh on companies and some regulations are bad ones. And this all happens without the side effect of government corruption.

It's just silly to hear anyone talking about something should be completely scrapped as if they know the result will be win-win for all parties in the long term.

[Veho Nex]

Seems like there's been a theme around here lately. A theme which conspires to make me rail against the evil's of most modern governments.

Is there anything more insidious than the slow, perverted way that western democracy can take away your freedom? I would almost prefer a regular old dictator to rise up against.

Well... I will take over the country through feat of arms and strength. Then you can try rising up against me. But remember I give out free chocolate pudding on wednesdays and saturdays I give out free fish tacos.

[Philippus Flavius Homovallumus]

The article makes a good point about regulations - they are almost never written with the people's best interests at heart. I feel like a lot of people on the political left have this idea in their head of a hardworking, underpaid government bureaucrat pouring over charts and graphs trying to figure out what the most beneficial, equitable solution is to a particular public policy issue when in reality regulations are usually direct copy/pastes given to them by industry lobbyists.

Then fund your political parties through taxes, not donations.

Make political donations illigal, and make it illegal for elected officials to hold shares, stocks, or bonds.

[CountArach]

Regulation is often, not just rarely, a tool of the powerful - people or corporations - to use governments and politicians against their competitors. The only answer is forbidding the government from such economic interference in the first place.

CR

I fear that corporate self-regulation would be no better than Corporatistic (as derived from Corporatism as a doctrine) regulation.

To be fair some of these regulation make at least a modicum of sense, for example:

ban parking in front of hotels and bars to wait for customers.

Would be logical in some situations in which parking is at a premium.

More laws that take effect in January 2012 would also require companies to replace all sedans and SUVs over seven-years-old, and all limos 10-years-old and older.

Also makes some sense from a safety standpoint, though as long as they have undergone mandatory servicing and are completely faultless, I don't see any problem.

So yeah, not a great law, but the intent at least kind of, sort of, maybe makes sense.

Make political donations illigal, and make it illegal for elected officials to hold shares, stocks, or bonds.

This.

[PanzerJaeger]

@PJ what you say is true, but instead of simply cutting the nose to spite the face we must recognize that maybe we shouldn't let industry have lobbyists in Washington in the first place.

Well, apart from the infeasibility of instituting such an initiative, the resulting effects would be far from positive. Lobbying is a vital element of a pluralistic democracy. It is the glue that binds the people's will and the legislation that enforces it. How, for example, is your average congressman supposed to know the intricacies of the American health care system well enough to regulate it and at the same time be an expert on which of a slate of the latest military weapons systems deserve funding and which do not?

The problem is the political class, and it always has been. They are supposed to act as honest brokers between various lobbying groups - to distill their complex proposals into their main points and then judge which of those will best serve their constituents. This requires a group of people motivated by altruism instead of money and power. They are hard to come by, but they do tend to manifest in times of real crisis. The best policy, however, is to keep as much power as is practical out of the hands of politicians in the first place.

Then fund your political parties through taxes, not donations.

Make political donations illigal, and make it illegal for elected officials to hold shares, stocks, or bonds.

I fear that would be a bit authoritarian for our tastes, freedom of speech and all...

We do actually have fairly strong laws on illegal forms of lobbying in this country though, and many of the most egregious offenders have been put behind bars. The problem is that the most skilled lobbyists deal in social currency and other intangibles, and relationships are far more difficult to regulate. Money changing hands in some dark alley is not how most lobbying is done.

[rory_20_uk]

I would LOVE the end of all regulation in Medicine and Pharmaceuticals. I could earn a fortune, perhaps even the less-regulated ones in America.

I think it is completely unfair that they make us show medicines work and don't kill people, and I'm not allowed a financial incentive to the treatment I provide.

Get rid off these onerous regulations ASAP.

[Husar]

I think a separation of big business and state is just as important as separation of religion and state. That's the next step, just watch.

Please expand a bit on that, how big business and religion are comparable and how religion is absolutely not regulated these days and/or why this topic has anything to do with regulation.

[drone]

The very fact that this is being hotly debated means we have already crossed the line.

A deeply divided House committee debated Tuesday whether to pass a high-profile bill that would prohibit members of Congress from buying and selling stocks based on non-public information they learn about through their work on Capitol Hill.

Several panel members — backed in part by the testimony of a Securities and Exchange Commission official — said the measure is not needed because existing laws and congressional ethics rules ban such action. They also said they worry that the bill, known as the Stop Trading on Congressional Knowledge (STOCK) Act, could be used to unfairly tarnish members.

“I’m concerned that this could become a witch hunt,” Rep. Carolyn McCarthy (D-N.Y.) said during the two-hour Financial Services Committee hearing. “Members are not out to make a quick buck.”

The resistance prompted Rep. Tim Walz (D-Minn.), a key co-sponsor of the legislation, to chastise his colleagues.

“If you think 9 percent approval rating is bad, drag it out and don’t do anything,” he said.

“Members are not out to make a quick buck.”

[Husar]

Just a couple posts above, my Hussarian friend.

Hmm, I may have misunderstood you there.

Those who think regulation keeps the small ones down, what about the anti-monopole regulations?
What kind of regulation allowed GameStop to eat up the smaller games shops?
What regulation allowed Intel to more or less ban AMD from some big retailers here until the EU actually stepped in?
Yes, the latter was illegal but it just shows what companies do when no regulation is there or it cannot be enforced.

The only way to deal with this is to give the government an incentive to actually work for all of society and not just some parts of it.
One way may be to tie part of their income to the average effective income(the one that lowers when prices rise while wages are stable) of average middle class people or whatever else is a good indicator of public wealth and cannot be easily raised by just catering to a few parts of society.

[Ironside]

Well, apart from the infeasibility of instituting such an initiative, the resulting effects would be far from positive. Lobbying is a vital element of a pluralistic democracy. It is the glue that binds the people's will and the legislation that enforces it. How, for example, is your average congressman supposed to know the intricacies of the American health care system well enough to regulate it and at the same time be an expert on which of a slate of the latest military weapons systems deserve funding and which do not?

Usually that's handled by political specialisation (committees? I'm not sure about the US word for this). Senator A knows the healthcare, while senator B knows the military systems.

The problem is the political class, and it always has been. They are supposed to act as honest brokers between various lobbying groups - to distill their complex proposals into their main points and then judge which of those will best serve their constituents. This requires a group of people motivated by altruism instead of money and power. They are hard to come by, but they do tend to manifest in times of real crisis. The best policy, however, is to keep as much power as is practical out of the hands of politicians in the first place.

I'm not sure exactly how that's a solution. The free market is already the powerful against the weak (technically all vs all), is cheerished to be going for money and power and the control is the consumer. Aka the random guy on the street that needs to get the same information as that overloaded senator to make informed decisions, while working at the same time (unlike the politician, where this kind of information gathering is part of his job). It's not like the politicians makes the industrial lobby corrupt.

It's the work of media and population to ensure that the politicians doesn't coddle up to the powers in the industry. Dropping the politician is a far cry from a solution.

[Beskar]

Hmm, I may have misunderstood you there.

Those who think regulation keeps the small ones down, what about the anti-monopole regulations?
What kind of regulation allowed GameStop to eat up the smaller games shops?
What regulation allowed Intel to more or less ban AMD from some big retailers here until the EU actually stepped in?
Yes, the latter was illegal but it just shows what companies do when no regulation is there or it cannot be enforced.

The only way to deal with this is to give the government an incentive to actually work for all of society and not just some parts of it.
One way may be to tie part of their income to the average effective income(the one that lowers when prices rise while wages are stable) of average middle class people or whatever else is a good indicator of public wealth and cannot be easily raised by just catering to a few parts of society.

That is what Regulation is about. it is used by the weak against the powerful. In this case, it is the powerful in a cartel trying to push through rules to benefit itself. instead of attacking the cartel which is what should be done, Americans have this fetish to attack the government instead and thus, do no regulation, which would allow these big companies to simply swallow the smaller ones anyway.

[a completely inoffensive name]

Well, apart from the infeasibility of instituting such an initiative, the resulting effects would be far from positive. Lobbying is a vital element of a pluralistic democracy. It is the glue that binds the people's will and the legislation that enforces it. How, for example, is your average congressman supposed to know the intricacies of the American health care system well enough to regulate it and at the same time be an expert on which of a slate of the latest military weapons systems deserve funding and which do not?

A. It isn't unfeasible.
B. We are not a pluralistic democracy.
C. The glue that binds the people's will is the vote. 99% of the public actually don't involve themselves in lobbying because they are too busy putting food on the table.

You are just wrapping yourself in Americana language that has no basis in reality. The majority of lobbyists are from companies. The rest are from very specific interest groups. Those that own guns and those that are old get more recognition than everyone else. That is pretty much it.

The politicians know just as little about health care and military programs as they would without lobbyists. What do you think the lobbyists are there for? To give an accurate picture of their industry? Watch "Thank Your for Smoking" for heaven sake.

The problem is the political class, and it always has been. They are supposed to act as honest brokers between various lobbying groups - to distill their complex proposals into their main points and then judge which of those will best serve their constituents. This requires a group of people motivated by altruism instead of money and power. They are hard to come by, but they do tend to manifest in times of real crisis. The best policy, however, is to keep as much power as is practical out of the hands of politicians in the first place.

Again, no basis in reality. Honest brokers? Since the country began, John Adams has been calling Jefferson a prostitute with his black slaves while he stripped away rights with the Alien and Sedition Act.

Politicians have never, ever, ever been honest men, doing what is right. There have always been good men in politics, but politicians as a whole have never experienced a time you are describing.

[a completely inoffensive name]

Well, I don't think anyone's asking for a total ban on business regulation.

CR is.

[Crazed Rabbit]

instead of attacking the cartel which is what should be done, Americans have this fetish to attack the government instead and thus, do no regulation, which would allow these big companies to simply swallow the smaller ones anyway.

GOOD FRICKIN' GRIEF

It's the government passing the laws, not the companies. And the big companies want regulation because they can not simply "swallow" the smaller companies.

THE GOVERNMENT IS RESPONSIBLE.

This is a situation where the government has misused its power - power of the sort that can only be misused. But instead of treating the disease you want to treat the symptoms. The government did not start passing these rent-seeking laws because evil corporations bribed them - corporations began pushing for these laws after they saw the government had the power to pass them. Take the government's power to pick economic winners and losers and they'll be no point to corporations trying to buy politicians. You won't need laws against donations or the like.

CR is.

No I'm not.

I'm asking for very strict limits; only laws against fraud, coercion, and harming people basically.

You don't need laws mandating new vehicles - just hold people responsible if someone is injured in a vehicle.

[Re: law against limos parking in front of hotels]Would be logical in some situations in which parking is at a premium.

No, it's not. If it costs money to park, let them pay it. If there's a time limit, hold them to it.

But singling out people or companies for stricter treatment is the basis of this problem.

CR

[Nowake]

Regulation is often, not just rarely, a tool of the powerful - people or corporations - to use governments and politicians against their competitors. The only answer is forbidding the government from such economic interference in the first place.
I'm asking for very strict limits; only laws against fraud, coercion, and harming people basically.

Yes, well, you only get to write something like this because you either refuse to acknowledge, choose to forget or simply are not aware of the full range of regulatory mechanisms needed.
Where do you place anti-trust laws exactly? And your legislation to separate investment from commercial banking? How do you keep in check global transaction banking? Will your policy on capital and reserve requirements, which you would hopefully put in place to protect people from harm as you write, not see financial corporations trying to influence it? In the same way, your restrictions on large exposures would somehow not motivate banks to lobby against them? Would you forbid monetary policy? You would do away with disclosure provisions?
Mind you, these are just off the top of my head, a qualified person would bury you. All of the above can be placed under your “do not harm the people” umbrella. By changing the name you do not affect the dynamics one bit. Good frickin’ grief? It helps no one if you react after the fact, that one can hold such a view at this point in time is surprising.

[Beskar]

It's the government passing the laws, not the companies.

Blame the Puppet and not the Puppet-Masters?

And the big companies want regulation because they can not simply "swallow" the smaller companies.

Because of the regulation already in place which stops them from doing so.

But instead of treating the disease you want to treat the symptoms.

That is incorrect, you want to treat the flu symptoms by cutting off the head, instead of trying to treat the disease.

The government did not start passing these rent-seeking laws because evil corporations bribed them - corporations began pushing for these laws after they saw the government had the power to pass them. Take the government's power to pick economic winners and losers and they'll be no point to corporations trying to buy politicians. You won't need laws against donations or the like.

So on one line.. "Government is not doing them because evil bribed them"
on the next line "corporations began pushing [see: Bribing] after they saw government had the power to pass them"

"Take the government's power to pick economic winners and losers and they'll be no point to corporations trying to buy politicians. "
Translation: Remove all regulation from governments hands, then corporations won't try to bribe government as they can do what they please anyway regardless.

No I'm not.

I'm asking for very strict limits; only laws against fraud, coercion, and harming people basically.

You don't need laws mandating new vehicles - just hold people responsible if someone is injured in a vehicle.

No, it's not. If it costs money to park, let them pay it. If there's a time limit, hold them to it.
But singling out people or companies for stricter treatment is the basis of this problem.

This is where your rhetoric breaks down, Crazed Rabbit. On one hand, you say one thing then you turn around then say something reasonable which gets lost in firehazard. If you want to promote simplified regulation and want action to stop corrupt policies from entering the law, then I think everyone agrees with you. However, you seem to want to paint 'government' as some big bogeyman and intend on removing the tolls which stop some really big injustices from occuring and not the "puppet-masters" which are in your own words "pushing" "bribing" their way to try to get what they want to benefit themselves.

[PanzerJaeger]

Usually that's handled by political specialisation (committees? I'm not sure about the US word for this). Senator A knows the healthcare, while senator B knows the military systems.

Yes, they are called congressional subcommittees here. The politicians on them are still hopelessly ignorant of the minutia that is involved in their broader topics.

I'm not sure exactly how that's a solution. The free market is already the powerful against the weak (technically all vs all), is cheerished to be going for money and power and the control is the consumer. Aka the random guy on the street that needs to get the same information as that overloaded senator to make informed decisions, while working at the same time (unlike the politician, where this kind of information gathering is part of his job). It's not like the politicians makes the industrial lobby corrupt.

It's the work of media and population to ensure that the politicians doesn't coddle up to the powers in the industry. Dropping the politician is a far cry from a solution.

I was not suggesting that we drop politicians. My point was that their reach should be high level and limited. In the article posted for example, should politicians really be involved in how much limousine companies can charge? They cannot possibly be expected to be experts on the premium transportation industry, so they have to rely on someone to tell them how to write the law. When politicians attempt to regulate at such a low level, distortion and corruption follow.

A. It isn't unfeasible.

It it entirely unfeasible to ban a specific group of citizens from the capitol, unless you would actually like to transition to that Stalinist autocracy that you've been talking about so much recently.

B. We are not a pluralistic democracy.

America is a pluralistic democracy.

C. The glue that binds the people's will is the vote. 99% of the public actually don't involve themselves in lobbying because they are too busy putting food on the table.

So you feel that, say, the myriad of provisions in the Telecommunications Act of 1996 should have been put to the vote? What about the new health care law? Should the people have been expected to vote on the structure of the state exchanges? Should they have been expected to know the economic complexities surrounding the the Medicare payment system?

Or are you saying that politicians should be writing these laws themselves without any guidance from the parties they will effect?

Your average citizen views politics on broad terms, as, like you mentioned, they are too busy putting food on the table to devote any more attention to the issues. Your average politician runs on those terms. There has to be some bridge between the voter's will and the translation of that will into actual legislation. That is where lobbying groups come into play in a pluralistic democracy, like the United States, whether they be from industry or other interest groups. It is easy to say 'I'm a low-tax Republican' or 'I'm a pro-labor Democrat', but actually constructing legislation to accompany those broad positions is a bit more complex.

You are just wrapping yourself in Americana language that has no basis in reality. The majority of lobbyists are from companies. The rest are from very specific interest groups. Those that own guns and those that are old get more recognition than everyone else. That is pretty much it.

I have no idea what you are talking about in regard my language.

Look, if you support a heavily regulated society, you also support lobbying by default. The deeper politicians reach into complex issues, the more assistance they will seek. Look at the financial crisis, for example. The people demanded action and the pols couldn't possibly wrap their heads around the complexities of the global financial system so we got the mess of competing, lobbyist-written provisions in Dodd-Frank.

The politicians know just as little about health care and military programs as they would without lobbyists. What do you think the lobbyists are there for? To give an accurate picture of their industry? Watch "Thank Your for Smoking" for heaven sake.

Exactly. You seem to think I am defending lobbyists. I am just stating reality. We live in a society where the government is expected to be involved in every aspect of our lives. That is not the world I want to live in, but it is the one I do live in. In such a world, lobbying is a necessity to keep us from Mugabe style mismanagement. You want to see a system worse than our current lobbyist driven one? Just get rid of the lobbyists and let the pols try and figure this stuff out.

[Ironside]

I was not suggesting that we drop politicians. My point was that their reach should be high level and limited. In the article posted for example, should politicians really be involved in how much limousine companies can charge? They cannot possibly be expected to be experts on the premium transportation industry, so they have to rely on someone to tell them how to write the law. When politicians attempt to regulate at such a low level, distortion and corruption follow.

They should have the option, since sometimes very detailed regulation is needed. But that kind of regulation isn't supposed to be tailor made for cooperate welfare. In those cases, it's the media and people's duty to strike down politicians that are making obviously corrupted laws. It's the power regulator the weak has against the strong going all chummy with eachother.

Simply moving up the politicians doesn't need to help, then the same lobbying would be used to make the politicians ignore already existing laws. Shouldn't existing Federal antitrust laws strike these laws down already?

[Beskar]

You know you can have consultants without lobbying groups, right? Just a FYI to those people who think that without lobbying, there isn't anything. Since we consultants in the UK.

There are still "Lobbying groups" but so without power compared to the American versions.

[a completely inoffensive name]

It it entirely unfeasible to ban a specific group of citizens from the capitol, unless you would actually like to transition to that Stalinist autocracy that you've been talking about so much recently.

Umm what? You write a Constitutional Amendment that says, no more private funding of political campaigns, and it's done.

America is a pluralistic democracy.

No it isn't. America is an elitist Republic. That's how the structure has been since the beginning. We may have more direct votes nowadays, but the system is inherently meant to not be pluralistic.

So you feel that, say, the myriad of provisions in the Telecommunications Act of 1996 should have been put to the vote? What about the new health care law? Should the people have been expected to vote on the structure of the state exchanges? Should they have been expected to know the economic complexities surrounding the the Medicare payment system?

No bro, I am saying that the vote is what binds the people's will to the decisions the government makes. Not lobbying. Citizens don't lobby, companies and special interest groups lobby.

Or are you saying that politicians should be writing these laws themselves without any guidance from the parties they will effect?

It's funny you say that as if it is a fact that that would be terrible for everyone even though you agree with me below that even now, politicians know jack all about anything they vote on.

Your average citizen views politics on broad terms, as, like you mentioned, they are too busy putting food on the table to devote any more attention to the issues. Your average politician runs on those terms. There has to be some bridge between the voter's will and the translation of that will into actual legislation. That is where lobbying groups come into play in a pluralistic democracy, like the United States, whether they be from industry or other interest groups. It is easy to say 'I'm a low-tax Republican' or 'I'm a pro-labor Democrat', but actually constructing legislation to accompany those broad positions is a bit more complex.

Except when you have a small number of groups or in many cases a single entity writing the legislation, it's no longer pluralistic, it's tyrannical. When the telecomm laws are written by telecomm lobbyists, the public gets screwed over, when the banking laws are written by bankers, the public gets screwed over. HOW PLURALISTIC OUR SOCIETY IS.

I have no idea what you are talking about in regard my language.

You are pulling these phrases about "the glue that binds things together" when the American system has never been in more need of reforms than today. It just seems really odd to say.

Look, if you support a heavily regulated society, you also support lobbying by default. The deeper politicians reach into complex issues, the more assistance they will seek. Look at the financial crisis, for example. The people demanded action and the pols couldn't possibly wrap their heads around the complexities of the global financial system so we got the mess of competing, lobbyist-written provisions in Dodd-Frank.

The politicians can seek the information they want on their own. You are being naive if you think the politicians simply went to the bankers because "it was all too complex", as if there wasn't 10,000 economists eager to come along and explain the whole situation if they were requested by Congress to show up.

Just to clarify, I'm not in favor of banning lobbying all together, mostly just banning private campaign donations in political campaigns. But in reality, these days all lobbying is just legalized bribery, so it more or less does the same thing.

Exactly. You seem to think I am defending lobbyists. I am just stating reality. We live in a society where the government is expected to be involved in every aspect of our lives. That is not the world I want to live in, but it is the one I do live in. In such a world, lobbying is a necessity to keep us from Mugabe style mismanagement. You want to see a system worse than our current lobbyist driven one? Just get rid of the lobbyists and let the pols try and figure this stuff out.

You are not talking about reality at all. You make completely false generalizations painting all of america as the liberal baby who needs the governments bottle even though there is a whole anti-government movement that is very prevalent today and the Democrats have only been in political control since ~2006-2008.

Everyone here admits that if the GOP had a strong candidate, Obama would be knocked out, yet somehow society is made up of mostly left leaning Democrats?