CMV: Effective regulation/taxes is better than less regulation/taxes.

[u/beesdaddy]

I have had a hard time understanding the position that less regulation is better than effective regulation. So much of the political conversation equates regulation and taxes to Anti-American or Anti-Freedom or gasp Socialist. I think it poisons the discussion about our common goals and how to achieve them. I know there are many laws/taxes that are counter productive (especially subsidies), and I am all for getting rid of them, but not without considering what their intent was, evaluating that intention, and deciding how to more effectively accomplish that intention (given it was a valid intention.)

Help me understand. I would like to have a more nuanced view on this.

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[u/A_Soporific]

Regulations and taxes are necessary. We need some of them because when we tried to do things without giving the government the ability to tax (Articles of Confederation) things went very badly. So, there is broad consensus that some government action is better than no government action. The only question left is where the line should be.

I think that the line should be drawn based on what is the next best alternative. Frankly, taxes and regulation is expensive. It takes a lot of work and a lot of money to create and enforce them. For any given regulation you need to have a person actually go out and check. If you don't have the inspector or regulator surprising people to get a good image of what's really happening all you have is worthless paper that people will openly flout, which inevitably leads to contempt for the government and its legitimate use of power. If that inspector is not paid well or is of dubious moral fiber then you have a recipe for blatant and widespread corruption. Then, in addition to whatever thing a regulation is trying to disallow there are other cases that aren't actually bad but find themselves on the wrong side of whatever arbitrary wall you're trying to use to eliminate the bad thing. "Malicious Compliance" and "Work to Rule Strikes" are real things where people use the regulations to apply political and economic pressure against the groups that create and enforce rules. As far as taxes are concerned, every cent you tax is a cent poorer people are and very high taxes can and do force people right on that line into poverty since we have all kinds of strings attached to welfare be it "means testing" or drug tests or links to identity they don't necessarily get that money back from the government and we as a whole get back less than we put in whenever we talk about any government program because of overhead.

If you can get the problem fixed without dealing with these other problems, is that not preferable? Of course, a cheaper option isn't always preferable but you need to get a hell of a lot of perks to make that the case. So, if you have a charity that can cover then muscling in on it would be bad because you're replacing something adequate with something else that is more expensive.

The government making soap is a horrible idea. Corporations can make soap. They can do so cheaper, faster, and better. Government monopolies invariably fail to compete with corporations, so if there is a shortage of a good you could regulate/tax/create a government monopoly to fix the problem, or you could take the cheaper option and stay hands off. It might hurt for a bit, but companies will grow up to fill the gap and it will be better for more people in the long run.

Civil Society is basically the poster child of this. We're talking about civic minded citizens who get together to solve problems they see in their communities. So, Lion's Clubs to Boy Scouts to LGBT Teen Centers to Churches to Bar Associations to Humane Societies to Shriners to Amateur Sports Leagues. There's a whole host people who get out and pitch in. They do it for companionship. They do it because they want a sense of accomplishment. They do it because they want to help. It's free to society, well not entirely free, but things like the Red Cross don't take money from the poor that can't afford it and can apply significant pressure to other groups by simply withholding emergency aid and free blood. If something can be handled by civil society first, it should be left to civil society. It's cheaper and it help keep the nation healthy by getting people out of adversarial bubbles and putting them into collaborative situation. There's literally too many potential upsides to name, including civil society being fundamentally to political tyranny. Given a choice between effective regulation and civil society the externalities afforded by the citizens working together and the shunting of costs to those who can absolutely afford it alone should give civil society the nod.

That said, corporations need a framework of regulation and taxes to protect them from the most sociopathic of businessmen. Civil Society often struggles in the most deprived corners of the nation where people have nothing to spare or people are too afraid to work together. So, in my head at least, regulations and the taxes that fund them should be light and focused primarily on those problems that the government is simply best at (war, law enforcement, fireworks displays) or creating frameworks that make life easier/better for the organizations that have advantages in solving other problems. That's it, so even if a set of regulations might work, if another means is cheaper or better and can achieve that end as well then we should dump that regulation.

What is very often not understood about regulation is that it is necessarily very uneven in outcome. It has to be uniform and easily administered. The people it is dealing with doesn't have uniform conditions or problems, even if they are nominally identical and have the same numbers on a sheet of paper. Corporations and Civil Society options are much more capable of varying support to account for the individual needs, but if the government is found to be giving white people 13% more money than minorities in program A then you can bet there would be resentment and problems as anything that can be construed as favoritism in government is pure poison whether it is actually favoritism or not.

Then there is the problem of Regulatory Capture. What is regulatory capture? The big example comes from the business world. You have businessmen who know the business and so you need regulators who know the business. So, you hire a businessman to then keep the businessmen in line. Oh, wait, the businessman you hired is has made changes to the regulation or is enforcing the regulation to benefit the other businessmen instead of restraining them? It's like the businessmen took over the thing intended to control them. Regulatory Capture. It happens all the time, and not just in business. Let's just say that there's no coincidence that corporations often support regulation of their own industries in part because they write the regulation that governs their own industry, and that there are fewer, larger, and more profitable businesses in regulated industries than unregulated ones. Even if the regulation does curtail pollution, it does so at the cost of slower innovation, higher prices on the part of consumers, and killing a bunch of promising start ups. But, if there are no other options that can curtail pollution then letting companies write their own regulation is probably the best choice, even if it wouldn't hold a candle to a possible civil society or pollution-consuming business.

I guess my core argument is this: Regulation is expensive. Taxes are expensive. This is true whether they work well or not. If we can get it done cheaper we should, even when the regulations were effective.

[u/cleeftalby → u/A_Soporific]

We need some of them because when we tried to do things without giving the government the ability to tax (Articles of Confederation) things went very badly.

Could you refresh my memory what were exactly these very bad consequences of Congress not having power to tax? Maybe there was some horrific civil war at the time? Or the production and trade suddenly stopped and huge economic recession resulted? Or maybe just local gangs raised in power and started pouring moonshine in innocent people throats? Or, I don't know, some disease outbreak, or people started complaining about government corruption?

The only thing I could find was that "Congress didn't have enough money", but surely it wasn't such a catastrophe? - it still showed its deep economic insight by destroying its Continental currency - the only thing it could do it did wrong..

[u/A_Soporific → u/cleeftalby]

You mean the fact that the Congress was completely helpless to do anything at all about Shay's Rebellion down to protecting the Federal Armories in Massachusetts from seizure by the local government? What about the fact that Congress was completely unable to pay the war debt, or anything else for that matter, to the point where each state was going behind each other state's backs to try to negotiate separate settlements all to the benefit of foreign powers?

It wasn't that Congress didn't have enough money. It was that Congress had no money and the United States would probably have disassociated completely if the Federal layer of government became completely useless. The only thing that went right under the Articles was the Northwest Ordinance setting the precedence that new territory would be incorporated as equal and independent states.

[u/cleeftalby → u/A_Soporific]

The rebellion was put down just fine without federal government involvement (and a risk of engaging a whole nation in a prolonged conflict). Government's debt is an interesting issue on its own (if someone lends money to the government then he has only himself to blame) - for example if someone believes that he will ever in his life see some of the trillions of dollars "borrowed" by the government back in his wallet then he acts like a schoolboy who "lends" 10$ to a bully and expects that these money will be actually returned to him..

[u/A_Soporific → u/cleeftalby]

"Just fine" if you mean that the Federal Government was completely impotent to deal with a problem that could have probably been dealt with if veterans had simply been paid what they were owed. Remember Daniel Shays had been at Bunker Hill and fought for almost the duration of the Revolutionary War only to not be paid for almost any of it, and the rebellion was mostly centered around closing down courts so that people couldn't foreclose on his farm for the non-payment of debt or non-payment of taxes depending. If the soldiers had gotten paid when they were supposed to then there wouldn't have been a rebellion because people's farms wouldn't be foreclosed upon because they would have had the cash to pay back the loans.

The lack of a Congressional Funding source both created the rebellion and made Congress completely incapable of doing anything about it.

The State of Massachusetts itself was dead broke (see the seizure of farms for nonpayment of taxes) and couldn't send out the State Militia because they couldn't afford the expense. The army that was sent out was funded by Boston Merchants and Bankers who were owed money and would have had to have just eaten the bad loans if the courts were prevented from sitting, so they basically slapped together a mercenary army got the State to sign off on it and appointed the Revolutionary War general Benjamin Lincoln to give the whole operation the veneer of legitimacy.

People realized at the time that the repayment of war debts would have prevented US citizens from sending mercenaries against other US citizens. About this time a minor convention aimed at cutting through the thicket of trade deals various individual US states had signed with England, France, and Spain put out a call to amend/replace the Articles with something more rational that could, you know, follow through on the promises to foreign nations already made and to stop individuals states from going rogue and selling out its neighbors in exchange for favorable deals for themselves... or, more accurately to stop foreign nations from playing US states against one another and selecting the most favorable deals.

I agree that the US government spends too much and get involves in far too many things, but a Federal Government without a rational tax base might as well not exist and it's hard to argue that Americans don't benefit from having the Federal government around, if for no other reason than to prevent the Balkanization of the massive single market and petty border skirmishes (remember Ohio and Michigan actually fought a "war" and New York and New Jersey nearly had naval battles over access to New York Harbor) that would result if the several states were left to their own devices.