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Great example of the issue of regulation

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  1. #1

    Default Great example of the issue of regulation

    http://www.vox.com/2014/5/5/5680394/...the-expense-of

    TLDR: the lower the barrier to get dental care, the more poor people who get dental care.


    I'm posting this partly because a popular anti-capitalism sentiment revolves around the belief that it favors exclusivity and immorality. This, however, is an example of how capitalism increases inclusion and morality. This isn't the only example, there are virtually countless ones. As a model, reducing barrier to entry into any economic behavior increases utility, morality, and ultimately the progressiveness of the society. And not in a small way. The China economic miracle is primarily about lax regulations on barrier to entry in business.

    I don't know what this says about the totality of regulatory policies, as there are ways they are arguably necessary. But it is a point against the hyper-regulation sensibilities we all have (liberals and conservatives alike). The overwhelming majority of people want rules for everything. That is the wrong approach. I think the right approach is one that considers rules the option of last resort, and examples like the article can help show why that would be.
  2. #2
    a500lbgorilla's Avatar
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    I always think of lower regulations this way - A firm takes in INs and produces OUTs, some of which can be traded for profit, others of which usually can't. If you can force people to deal with their own OUTs, we'd be golden. But some people find the best way for dealing with the OUTs is to dump that shit in my drinking water. And I want somebody watching out.

    And I already know Rentons solution. But I don't yet believe like he believes.
  3. #3
    a500lbgorilla's Avatar
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    Or to dump that shit in my air. I'm looking at you, entire history of fuel consumption.
  4. #4
    Quote Originally Posted by a500lbgorilla View Post
    I always think of lower regulations this way - A firm takes in INs and produces OUTs, some of which can be traded for profit, others of which usually can't. If you can force people to deal with their own OUTs, we'd be golden. But some people find the best way for dealing with the OUTs is to dump that shit in my drinking water. And I want somebody watching out.
    This is definitely the foundation of pro-regulation sentiments, and it doesn't appear to be wrong since there are examples of regulation thwarting specific corruption. However, this assumes its own premise that regulation solves problems of corruption in aggregate. I'm not sure if it does or doesn't. Additionally, regulation virtually always throws the baby out with the bathwater by stymieing some OUTs that are actually good. But overall I think the best point was one Renton made a while back: property rights take care of the problem of somebody dropping their OUTs on you.

    Most of the rights we experience in our daily lives have little to do with regulatory policy and a lot to do with the protection of property. For example, there are virtually no regulations about how you and other people are allowed to physically interact with each other, and everything works out fine. Regulations on personal interaction exist when it becomes violent or sexual, the former of which is cut and dried property protection, and the latter of which I think is misguided regulation and we'd be better off without them. The same sort of situation can be applied to dumping toxic waste if you let space be owned and protect those rights. It's like with the West Virginia thing: Renton is probably correct in that if rivers were privately owned, we'd live in a world where that doesn't happen.

    What we want: laws that protect property and uphold non-coercion

    What we don't want: laws that create layers of rules that are not related to property protection. A great example of this that I keep using is zoning. Cities (and countries at large) absolutely fuck themselves with zoning regulations. The regulations exist because of voters who live in the cities who want to conserve their position as incumbent special interests, but these regulations have dire consequences on the movement of capital and even go so far as to create such extremes like homelessness. If we were to collectively cut away all zoning regulations, we'd find gargantuan influxes of capital and migration to hubs, an emigration of those who could no longer afford to live there, and a vast improvement in living standards for everybody involved (especially to those who emigrated to areas where their capital is better utilized). But again, voters in cities don't want to go where their capital is best utilized (even if it means they would be ultimately wealthier), so disastrous zoning regulations that hurt everybody remain in place
  5. #5
    Quote Originally Posted by a500lbgorilla View Post
    Or to dump that shit in my air. I'm looking at you, entire history of fuel consumption.
    Most libertarians favor taxing harmful externalities like this. Ultimately, things like getting lead out of gasoline could happen without regulation just as easily as with it as long as property rights are upheld. The process would involve lawsuits against the company where the plaintiffs demonstrate how the lead in the atmosphere is harmful to their property (their bodies) and produced by the companies. This, along with public awareness/pressure, would likely have just as strong an effect on cleaning up externalities. Companies can't cheat markets
  6. #6
    I should add that for ever regulatory success story, you can probably find multiple failures or indirect negative consequences. I say this because a lot of times people make the perfect the opposite of what they don't like. An example of this is with global warming. Many think that what companies and humans are doing are bad for the environment, so they think the solution is to regulate against that, but they don't do the legwork to figure out that regulations that can solve the global warming problem simply don't exist. The government has very little clue about how to stop global warming, so trying to fix it by getting the government involved is nonsensical. If anything, the markets are what will ultimately solve the global warming problem
  7. #7
    a500lbgorilla's Avatar
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    Quote Originally Posted by wufwugy View Post
    Most libertarians favor taxing harmful externalities like this. Ultimately, things like getting lead out of gasoline could happen without regulation just as easily as with it as long as property rights are upheld. The process would involve lawsuits against the company where the plaintiffs demonstrate how the lead in the atmosphere is harmful to their property (their bodies) and produced by the companies. This, along with public awareness/pressure, would likely have just as strong an effect on cleaning up externalities. Companies can't cheat markets
    I don't trust people to get this right. It's clear to me that some people are talented at establishing and moving public opinion. The public can easily become split over a complex issue with an inability to discern the experts from the expert-fakes. I don't understand enough about the legal system to wonder on how it will fail, but I'm betting the side with the biggest pile of cash is better than no chance to win over some cold hard facts on the ground.

    And in your post below the quoted, you say that people make perfect the opposite of what they don't like. I agree and partially believe this fuels the love for these theoretically free market societies. Because we have to live with the shit society with its regulations today, and don't have to deal with any of the unforseen possible fallout from these pretend societies of tomorrow.
  8. #8
    Quote Originally Posted by a500lbgorilla View Post
    I don't trust people to get this right. It's clear to me that some people are talented at establishing and moving public opinion. The public can easily become split over a complex issue with an inability to discern the experts from the expert-fakes. I don't understand enough about the legal system to wonder on how it will fail, but I'm betting the side with the biggest pile of cash is better than no chance to win over some cold hard facts on the ground.
    The same is true of regulatory agencies and policymakers. The argument is that those end up making it worse by creating special interests and misallocation of capital due to inefficiencies and distorted incentives, while market foundations go the opposite direction and solve a lot of these problems due to relying on consequential capital allocation.

    I think you're assuming a distinction between decision-making and truths; whereas market proponents don't necessarily. The reason is because a market system is itself a truth-finder because "the cold hard facts" of whatever economic behavior prevails is what wins out. Costs and prices are representations of those economic facts and behaviors. I think when we look at the influences of the smoke-filled room shadow characters, we're only seeing a fraction of the picture. In our current society, those with the greatest influence in aggregate have come out of this value system (Microsoft made Bill Gates, not Machiavellisoft). Ultimately, the allocation of capital chases cold hard facts, be they about raw resources or cultural sensibilities

    Socialism is at its core an attempt to thwart markets. Its an attempt at supreme morality, at capital distribution based on morals instead of the cold hard facts of the world, and that's why it has failed in every country that has tried it
  9. #9
    If you follow the econ blogosphere, you may have heard about Gary Becker's death. He was the Nobel laureate who introduced and popularized this idea -- which is today consensus among economists: in a competitive marketplace the presence of discriminatory business practices would create profit opportunities for less-discriminatory business practitioners. This economic behavior demonstrates that all sorts of moral problems can be fixed by unregulated markets. It claims that deep moral problems of racism and gender discrimination are largely solved when people are allowed to act freely because that freedom favors those who engage in the most morally supported behaviors. I agree with this and I think the same is true of virtually all aspects of society

    Becker became famous for showing the economics profession (and the world) that economics is in everything
  10. #10
    After spending over a year away from poker, and coming back to this site... I find Spoonitnow teaching spiritual growth and wufwugy teaching free markets. (I thought wufwugy was leftist socialist kinda or I'm mixing him up with somebody else?) By the way I spent the last few years learning the same thing SO I APPROVE!


  11. #11
    Quote Originally Posted by Smith View Post
    After spending over a year away from poker, and coming back to this site... I find Spoonitnow teaching spiritual growth and wufwugy teaching free markets. (I thought wufwugy was leftist socialist kinda or I'm mixing him up with somebody else?) By the way I spent the last few years learning the same thing SO I APPROVE!


    Two questions:

    1. Who are you? Just Smith? You lurked then, because I don't recall us arguing

    2. Yes I was basically lefty socialist. I'm always learning and changing. I decided a long time ago to never believe something if the evidence goes against that belief, and I have learned that the process of being right is finding every way in which I'm wrong. I argue my positions to the best of my ability, and I only end up sticking with the ones that have merit. If you scour my post history you'll find all sorts of whack shit, but it was whack shit with a purpose.
  12. #12
    1. Yea mostly a lurker, pretty weak passive player on the forums

    2. Yea I know that you were very active in throwing out arguments and topics that you wanted to discuss. I think that going through that process is amazing. Not many people give enough shit to even bother. Arguing is the best thing, because you can't get to the truth of anything without a healthy debate.
  13. #13
    Oh, and it basically comes down to the Non-aggression principle. Voluntary exchanges yadda yadda....
  14. #14
    Two more

    http://www.vox.com/2014/5/29/5760220...ts-three-times

    http://econlog.econlib.org/archives/...er_on_t_1.html

    On the surface, these may not seem like the biggest deal, but I think if we had to give one reason why China has improved more quickly than anything ever, it would be because of almost total deregulation of business licensing. So when we see that licensing causes problems in the US, we should think it's a really big problem

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