Regulating business?

[Kire]

I posted this on a Libertarian message board and was wondering if you had any input. As you may know, Libertarians are for deregulating all businesses, so that's the issue I brought up.

I believe deregulating businesses would be bad for overall safety and the economy. An example of this is Bush signed a law which allowed people who had no business getting home loans, and now we're suffering the results of that decision in the form of the mortgage crisis. Businesses would be able to make unfair practices by burying the details that matter in the fine print...this is already happening w/ credit card companies, but these problems would be made worse.

In terms of safety, this is along the lines of the prior point: having the FDA is a good thing. Self regulation has been proposed by the show, but we've seen drug companies put out false studies and withhold long term effects information to make a profit on their product. In other words, it DOES pay to hurt your customer...you just have to hide or deny that it's happening in the first place (much like tabacco companies). There are successful self regulation organizations out there (the ESRB), but this only resulted from government pressure. There needs to be an outside organization who is not deterred by the profit of any product for the good of the people.

[Karr Lord of Chaos]

Re: Regulating business?

absolutely always need to have a watchdog. people will abuse everything they can, its just human nature to do so. someone has to be looking in to spot the bad apples, which means business must be regulated.

to keep a strong economy you have to generate faith in its currency value. having practices that generate credit loss, bankruptcy, and fraud all erode the faith of the currency. loss will happen, but its the ratio of loss that is important.

if profits are shrinking then the banks are going to get nervous and start calling their mortgage loans. bankruptcy is generated fastest here as people are suddenly unable to pay their bills, which means they have no money to spend elsewhere (which may already of been a problem with the over inflation of the market).

this impacts sales which investors see and decide to invest their capitol elsewhere where markets are booming rather then shrinking. less people buying means less profits, which means less faith in the american markets, which finally translates into a shrunken economy.

individually this would be bad for any business, but on the scale of a national market this is ground zero of an economic recession. this is made worse if people begin to realize just how overextended the countries currency value is.

russia maybe a good example here with the collapse of the ruple. though this is a very extreme case, its still related to our example here in a lesser degree.

[Sampson]

Re: Regulating business?

Some industries need some form of a watchdog group, but most don't. In my opinion, the government is too regulatory as it stands right now.

The FDA is probably the absolute worst example for you to use. It's widely regarded as being corrupt. It drives the cost of drug development and production sky high--thus severely limiting the amount of competition and therefore creating artificially steep drug prices.

There's also a lot of movement of individuals from drug companies to the FDA and vice-versa (CEOs of some drug company becoming an official in the FDA and such).

The FDA also gives an incentive for drug companies to OVER test their products. This delays their introduction to the market and actually costs more lives than it saves.

[goldgecko4]

Re: Regulating business?

I agree that government intervention is absolutely essential in many facets of business. Only problem there is that the government IS intervening, in the respect that politicians are doing all they can to benefit from the gouging of the average consumer. You know how we complain about gas prices and medical costs in this country? Guess which two industries keep posting record profits, year after year? That's right, Oil and Medicine. And guess which two have the largest number of lobbyists in Washington, give the most in campaign contributions, and have the most government officials sitting on their boards? Again, Oil and Medical. So yes, we need intervention, but so that everyone can access the product at an affordable cost, not so that the ruling class can by their third house, or their fifth boat.

[Shard]

Re: Regulating business?

I'm lazy, but the Loose Change thread from a year back adequately covers my views on regulation and when and where it's needed( and when it isn't). Sampson spelled out his views there as well, to save you all a retread, it's on pages 2 and 3.

Edit: Or do a search for "deregulation" and sit back for a spell of vintage Terr.