Cartoon 794: Regulation

Businesses have merged and become large conglomerates, such as argi-business concerns. The large entities in general reduce production, distribution and marketing costs. It gives the business a large footprint and leverage in the marketplace. The return to investors is handsome. There is a dark side, regulation.

Because of the scale of these operations an e coli or other containment potentially affects a broad swath of the product. Regulation requires they limit the contamination. It may make take the form of a product recall that runs into the millions of dollars. Without regulation these businesses would not recall the product and fall behind “let the buyer be ware”.

In fact regulations requiring disclosure is an anathema. The government during the first term of the Bush Administration removed the requirement that businesses must notify the public of computer and data breaches. Therefore if a company is hacked and your information is stolen they have no obligation to tell you. I guess you are wondering if that is true, why do we see data breaches in the news. There are two reasons. First the secrecy surrounding the incident is penetrated. The second reason is that there are “white hat” hacker organizations that identify flaws and publicize the information. It forces business to do something, which costs money, as opposed to doing nothing. Needless to say businesses rail against this approach.

The next time you fly remember that airplane was serviced in foreign country so that the American airline can avoid regulation scrutiny. The next time you get on a train be aware the tracks and systems have maybe one inspector for a thousand miles. Congress deliberately did this to make inspections and upholding regulations impossible. The next time you buy fresh produce, remember Congress just unfunded much of inspection. Finally remember Congress is actively killing the ability to correlate data on American citizens, The Census. Without that data you would a difficult time drawing conclusions on breast cancer, heart attacks or even the effectiveness of programs. It also sets the stage for business to “lawyer up” in a controversy and stifle any meaningful action falling behind “inconclusive’. The same approach used by the tobacco industry for decades. Today this approach is the engine behind the climate change doubting.

It is all about profits. Regulations reduce profits.

A party and its candidates are all about the profits of the Investment Class to the exclusion of everything else. Any other issues are merely enablers to achieve their focused objective.