gamesareart asked: Some have this idea of Government as a regulator and that they should regulate the private sector. What do you think about government regulating business?
I was thinking about this before, and I came to an answer....kind of. The thought was this. Whether businesses need to be regulated is not the question. I am almost certain that they do. The question is if the regulation should come from the company themselves, a group of industry regulators (think american dental association or other groups like that) or from the government.
I don’t think government should regulate business. As Henry Hazlitt puts it in Economics in One Lesson (one of my favorite books to recommend and quote — definitely read it if you haven’t! It’s quite short.):
The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.
This is very closely related to Hayek’s idea of the fatal conceit, which is the belief of legislators that they are wise enough to control the economy (or a portion of the economy, such as an industry) better than the market could. So any attempt at government regulation, no matter how well meaning, is inevitably going to do more harm than good, even if the harm is not easily identified.
As for private regulation, I have no problems there.
Many consumers, particularly of goods about which they’re not well educated such as health care or automobiles, may be comforted by the fact that the business they choose to employ has been checked out by a respected independent agency and is complying with industry standards.
Other consumers may not care.
And as long as no one forced the businesses to accept the regulation or forced the consumers to shop exclusively at regulated businesses, then that all seems quite practical, reasonable, and fair.
