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Wednesday, February 27, 2013

Why regulate?

What is the point of regulating anything, given the difference between theoretical regulation and its actual results?
 In the 120 samples labeled red snapper and bought for testing nationwide, for example, 28 different species of fish were found, including 17 that were not even in the snapper family, according to the study, which was released Thursday.

The study also contained surprises about where consumers were most likely to be misled — sushi bars topped the list in every city studied — while grocery stores were most likely to be selling fish honestly. Restaurants ranked in the middle.

Part of the problem, said the study’s chief author, Kimberly Warner, is that there are quite simply a lot of fish in the sea, and many of them look alike. Over all, the study found that about one-third of the 1,215 fish samples bought, from 2010 to 2012, were mislabeled. 
I understand why people like the idea of regulation.  But if it fails nearly one-third of the time, is it actually doing anything?  What would happen without all the expense and effort of government regulation, would everyone be eating cod-oil infused vegetables instead of fish instead of only one-third of the people getting the wrong fish?  Would anyone even notice if the SEC employees weren't keeping their eagle eyes on internet pornthe markets?

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Anonymous dh February 27, 2013 12:21 AM  

I understand why people like the idea of regulation. But if it fails nearly one-third of the time, is it actually doing anything? What would happen without all the expense and effort of government regulation, would everyone be eating cod-oil infused vegetables instead of fish instead of only one-third of the people getting the wrong fish? Would anyone even notice if the SEC employees weren't keeping their eagle eyes on internet pornthe markets?

#1 - Yes, of course it's doing something. It's keeping people away from temptation to intentionally mislead people. The type of "truth in advertising" regulation is important in a free market. Otherwise, people just won't buy anything. If everyone is constantly on the look out for fakes, commerce is harmed. If the consumer is at a serious information disadvantage then he or she is less likely to be confident enough to make a purchase.

#2 - In this case, with no regulation, people wouldn't trust restaurants enough to eat out as often. The bad actions of some restaurants and suppliers intentionally committing a fraud on the consumer would doom the whole enterprise.

#3 - The SEC is an abomination. They should just stop. The markets and financiers actively resist transparency, when transparency is the only thing that could have prevented their demise in 2008. Let them twist.

Regulation which curbs or attempts to curb bad actors from poising the consumers is a fundamentally good way to promote free markets.

Blogger IM2L844 February 27, 2013 12:36 AM  

Anarchy has it's strong points. I've come to the conclusion that one of the main problems with regulating anything is that there isn't a dependable way for the public to hold the regulators accountable.

Anonymous dh February 27, 2013 12:38 AM  

Anarchy has it's strong points.

Examples? I suppose you have to watch out for yourself, which has liberty-ness going for it, but on the other hand, you need to have someone watch your back why you sleep. And that sounds like communism.

Anonymous Sensei February 27, 2013 12:53 AM  

Anarchy has it's strong points.

It tolerates rogue apostrophes, for example.

Anonymous kh123 February 27, 2013 1:06 AM  

"The type of "truth in advertising" regulation is important in a free market. Otherwise, people just won't buy anything."

In other words, regulation alleviates caveat emptor.

"If everyone is constantly on the look out for fakes, commerce is harmed. If the consumer is at a serious information disadvantage then he or she is less likely to be confident enough to make a purchase."

Given that a good deal of that purchasing has been with previously easy credit, would this mean a significant drop in malinvestment.

As far as a drop in food purchases, at least for America, that would probably translate to less obesity and health problems.

Anonymous Alexander February 27, 2013 1:08 AM  

Yeah but at least a fish is still a fish. Without regulation, what we think is beef could very well be horse meat!

Anonymous kh123 February 27, 2013 1:08 AM  

"In this case, with no regulation, people wouldn't trust restaurants enough to eat out as often. The bad actions of some restaurants and suppliers intentionally committing a fraud on the consumer would doom the whole enterprise."

I take it you've seen the original Ch 4 version of Kitchen Nightmares.

Anonymous Noah B. February 27, 2013 1:14 AM  

"In this case, with no regulation, people wouldn't trust restaurants enough to eat out as often."

Generally, my assumption is that regulation accomplishes very little of its intended purpose, if any. Its main effect is to increase costs of doing business. And my experience with regulations is that they tend to be so vast that it is unlikely for any given business to comply with them in full.

So when I go out to eat, I am well aware that the establishment could probably be held in violation of multiple health codes at that particular moment. But I still eat out.

Blogger IM2L844 February 27, 2013 1:18 AM  

It tolerates rogue apostrophes, for example.

I hate you,?

Anonymous dh February 27, 2013 1:20 AM  

I take it you've seen the original Ch 4 version of Kitchen Nightmares.

Oh yes. Foul. One of the many reasons I enjoy organically grown locally sourced hand picked food products in the comfort of home.

In other words, regulation alleviates caveat emptor.

Partially, yes. There is a point where caveat emptor really means "just say no". Without a robust regulatory framework there are somethings which will always be too risky to trust. Air travel is a great example. In the capitalist fictional world of little or no regulation, air travel is basically a game of trust - do you trust the carrier, do you trust the manufacturer, do you trust the mechanics and the airport, et all. At first companies will do the right thing - that's the nature of trying to do something good. Overtime, though, competition tempts the weaker companies to cut corners to compete. And, as we know, this is dangerous. We know it's dangerous because planes crash despite the regulation, from bad practices and mistakes in engineering. And also just bad luck.

The regulatory framework of the FAA who regulate all aspects of airline operations is the only thing that keeps the public flying. As it is, the FAA is losing it's battle to properly regulate pilots, maintenance, and plane airworthiness. And it has a negative long-term effect on the whole industry. Without a robust FAA, there is no way I would trust *any* company. And since I can't personally ensure they are doing the right things - other than kicking the tires and looking at the paint job, I have no clue if a plane is maintained, a pilot is qualified, the ground crew on the ball, etc - my only option is that no matter the price, I won't fly. The fact that my estate can sue the airline into the ground after a tort in which I die is of very little use to me.

There are many other such examples, but your list will be likely different from list. The general principle is the same though. Without a policy, and clear regulatory framework, some businesses are simply too expensive or too risky for consumers to utilize.

Given that a good deal of that purchasing has been with previously easy credit, would this mean a significant drop in malinvestment.
...
As far as a drop in food purchases, at least for America, that would probably translate to less obesity and health problems.


These are both true, really. The modern regulatory framework makes it possible to finance things overtime, it makes it easy to spend more money, in advance of earning it. And we could all do with less food, and less prepared foods, that's for sure.

It's the same story across the board - the industry isn't important, but the principle remains the same.

Anonymous dh February 27, 2013 1:28 AM  

Generally, my assumption is that regulation accomplishes very little of its intended purpose, if any. Its main effect is to increase costs of doing business. And my experience with regulations is that they tend to be so vast that it is unlikely for any given business to comply with them in full.

Why does it increase the cost? The reason is that people have to (1) incur compliance costs and (2) do things which they normally wouldn't do, without the regulator, that cost at least as much as the alternative.

#2 is strong evidence that the regulations have an effect. We can debate positive or negative, but the increased cost of business, apart for #1 above, is strong evidence that regulations *do something*.

As far as the number, I agree, it tends to sprawl.

It's still generally important. I am not of the opinion that we shouldn't have barriers to small business creation. Businesses that are so small they can't maintain basic controls and safety measures shouldn't be open.

One thing that I would be happy to see is more graduated licensing. When I see nightclub fires where lots of people die it is sad. It's sad because they are illegal nightclubs usually. Having a way to get the most basic regulations met without imposing the full slate would save lives.

Anonymous Toby Temple February 27, 2013 1:31 AM  

Regulation creates jobs!

Why do you hate people, Vox!? WHY!?

Blogger KevinV February 27, 2013 1:32 AM  

And the clear lesson here is that fish continues to be gross and should not be eaten.

Anonymous Mavwreck February 27, 2013 1:36 AM  

The absence of regulation becomes a problem in larger societies, more
spread-out societies, or more complex interactions.

In smaller communities (either in size or distance), we're more likely to know the people involved somehow. In simpler interactions we can figure things out using our own knowledge.

When commerce takes place over large areas, in large communities (filled with people you don't know), or over complex matters, these judging tools aren't as reliable. We have to get someone else to handle those judgements - either someone who has the expertise we don't, or someone who has the ability to go poking around behind the scenes.

Of course, then we have to trust them...that gets complicated. However, even imperfect regulation is better than nothing.

Anonymous Toby Temple February 27, 2013 1:39 AM  

Imperfect regulations are very dangerous. Regulators can be bribed to turn a blind eye.

The result is that the damage is done before a complete stop on operations is imposed.

Anonymous Jack Amok February 27, 2013 1:42 AM  

In this case, with no regulation, people wouldn't trust restaurants enough to eat out as often

When I lived in San Diego, the county inspected every eatery and required them to display the grade (A through, I imagine, F) in the front window. Every place, no matter how dysfunctional, was rated A.

Except for one bar in Old Town. They got a C. Because they served beer in "yards" (3 foot long tubes), and the tubes didn't go through the particular dishwasher the inspectors preferred.

Then here in Washington State, I have a friend who's run restaurantes for 20 years. The only thing the inspectors care about is the refrigerator temperature.

Yeah, useless.

Anonymous sprach von Teufelshunden February 27, 2013 1:44 AM  

Regulation within despotism is for the specific purpose(s) of control. It has nothing to do with safety and general rational order. Remove the despots, then we can talk about rational regulation. (if in fact, there is such a thing) Recall the scene in Serenity, where the personal scanner reveals that one has a "social control number" (vs. security) Will our future overlords actually become more honest with us? I prefer a honest despot.

So far as the SEC watching the markets. Recall in a spy flick, when someone puts a feed-back loop on a security camera. That's the market. That is what the SEC guys are watching, and trying to figure out. It's an illusion. [1]

Since this thread concerns society, and societal mores and morals, does everyone here realize that Sam Harris is Jewish, and quite the friend of [govt] Israel. Among other things:

Abu Ghraib and the Jewish Century

Yeah, you say, "What does Sam Harris have to do with Abu Ghraib?" More than you think...




----------
[1] Many here are probably saying to themselves, "What are these protocols?" Specifically:

$30 Billion to Russia
$5 Billion to the following:

Canada
France
Germany
Greece
Italy
Mexico
Spain

"The Protocols will settle the rocky financial markets so close to failure in Europe and that, in turn, will go a long ways toward settling the markets of the United States."

Anonymous Noah B. February 27, 2013 1:47 AM  

"It's still generally important. I am not of the opinion that we shouldn't have barriers to small business creation. Businesses that are so small they can't maintain basic controls and safety measures shouldn't be open."

Big companies use this fear on your part to reduce their competition, which allows them to increase their prices. In the end, you really are screwing yourself.

Blogger redlegben February 27, 2013 1:47 AM  

A couple of huge issues with the lack of regulation I can think of:

1. The catastrophic effect China is having on their natural resources.

2. Nuclear reactor safety in the US vs. Chernobyl.

There has to be an in-between.

Anonymous Jack Amok February 27, 2013 1:48 AM  

Without a policy, and clear regulatory framework, some businesses are simply too expensive or too risky for consumers to utilize.

"Government" would appear to be one such business.

We need more regulation of government. When you consider the sheer number of people killed, maimed, or swindled by various enterprises, those who have suffered at the hands of unregulated government are the vast majority. One-third of fish are mislabled? If only one-third of all proposed legislation was mislabled, it would be a freakin' miracle. If politicians only lied one third of the time, I'd keel over in shock.

So I'm glad to know dh is on board and will immediately start campaigning for tighter regulations on government.

Anonymous Roundtine February 27, 2013 1:52 AM  

There was a book out around the year 2000 by an economist, and it was filled with charts (maybe 100). It had lots of charts of pollution, safety, longevity, etc., making the point that things were improving over time. On the pollution chart, you could clearly see that passage of the Clear Air Act had a huge impact in the 1970s. Pollution levels plunged and the slope of the line changed.

With workplace safety and other areas, you couldn't tell from the chart where laws were passed. The slope of the line was pretty much unchanged over the past 100 years. It's quite obvious then that OSHA is a net drain on the economy, whereas the EPA has some limited role to play.

Anonymous dh February 27, 2013 1:57 AM  

When I lived in San Diego, the county inspected every eatery and required them to display the grade (A through, I imagine, F) in the front window. Every place, no matter how dysfunctional, was rated A.

I visit this area often and I don't have the same recollection as you. Every place you go has the 'A' outfront, because of public shaming / pressure forces them to cleanup.

Look at this article: http://www.nbcsandiego.com/investigations/Restaurant-Inspections-San-Diego-138597119.html

One of the restaurants is one I have seen, but never eaten at. Emerald Cafe. They failed at inspection and had major problems, and earned a less than perfect score. They got a 'B'. So the article is written in May 2012, when re-inspections occurred in November they scored an 'A'. (See: http://www2.sdcounty.ca.gov/ffis/DetailPage.aspx?Permit_id=503020).

So probably at any given time 99% of restaurants have an 'A', but it's only because a C or lower gets you shut down, and a 'B' gets you in the newspaper and shamed into fixing your problems.

The alternative, by the way, is you asking to inspect the kitchen yourself, and being told to go do an anatomically impossible act upon yourself. And then you decide: take the risk, or go without?



Anonymous dh February 27, 2013 1:59 AM  

So I'm glad to know dh is on board and will immediately start campaigning for tighter regulations on government.

I strongly support this. I would fully support and do support all of the same sort of regulatory framework on government itself. Stronger and more toothy inspector generals, mandatory testing periods for new laws and regulations, mandatory sunset of new laws, etc.

And, I also would *love* to see a huge surtax on post-government employment private sector work. I am thinking a 90% surtax on first-year excess earnings the first year, decreasing 10% each year, to a minimum of 20%.

Anonymous dh February 27, 2013 2:04 AM  

There has to be an in-between.
Nuclear regulation is a great example of a system gone insane.

On the one hand, you have endless regulations that have no basis in reality. These are lobbied for by the fossil fuels industry. They are simply barriers.

And on the other hand, you have actual important regulations - about redudant systems, about disaster prep, etc that are vitally important and they get killed by the nuclear industry.

In the end, the industry is killing itself. Ask Japan operators how regulatory capture worked for them. Why could go wrong with putting all of your disaster generators near the ocean?

Blogger redlegben February 27, 2013 2:07 AM  

dh, I couldn't agree more.

Anonymous Toby Temple February 27, 2013 2:19 AM  

Yes, we need regulations.

But who should be doing it? The government?

Anonymous Roundtine February 27, 2013 2:20 AM  

A couple of huge issues with the lack of regulation

Are you seriously going to argue that communist run Russia and China are examples of no regulation? The government is never regulated because it is the regulator. Who watches the watchers? No one. Even in the U.S., the military is one of the worst polluters.

Anonymous dh February 27, 2013 2:34 AM  

But who should be doing it? The government?

Self-regulation is simply a dance. It can work as long as the underlying industry is healthy.

But just ask Alan Greenspan. He believed to his core that the invisible hand would prevent CEO's from being reckless. Sometimes, the invisible hand sometimes isn't busy guiding, it's busy pleasuring the CEO under the table.

There isn't a magic formula, but many states have regulators who are very good at what they do. It depends on how well the framework is setup, how well the laws are written, and what the regulations actually are.

In the end, it's all about enabling business. When that that mission is abandoned is when we have problems.

Blogger redlegben February 27, 2013 2:40 AM  

Corporations, whether run by states or a board of directors, seek profits now. My point is that we need a societal regulator to stop certain types of egregious problems. How that is accomplished is what is up for debate. I made no such argument that regulatory systems don't exist in said countries. I said there is an obvious need for it based on the resultant examples in those countries. As much as they regulate some things, they are obviously lacking in long term results relating to those two issues. In both cases they ignore the long term for short term economic benefits. Sacrificing people and environmental sustainability in order to achieve short term profits and gains. Yes the Chinese and Russian environments will eventually recover, however it was a costly mistake for them to make on a utilitarian model. Similar to the one-child policy that China had which doesn't work out long term. It's great in the first generation, but eventually other issues come into play.

Anonymous Roundtine February 27, 2013 2:40 AM  

I would guess regulation falls in the 80/20 pattern of 80% being not only worthless, but counterproductive. If you consider all the regulations that harm and kill people, and the losses caused by regulatory costs slowing the economy, eradicating all regulations may well be a net win.

About the only place to consider regulation is in areas where there's potential for government (socialized) losses. Some areas you might think need regulation do not: for instance, cut back on flood and hurricane bailouts and the market will move people out of hurricane and flood zones, or cause them to build smaller, more storm resistant homes. We don't need financial regulations, it is the regulations and Fed control that created the big banks that threaten the whole system. We don't need workplace safety rules, sexual harassment laws and all the rest. Most everything else is served by laws against lying, cheating and stealing. The courts are there for a reason and will punish those who violate people's rights.

Anonymous farmer Tom February 27, 2013 2:43 AM  

"For by the law, is the knowledge of sin..."


No one would argue that "the law"(regulation) creates perfection. But, law(regulation) is necessary to establish the standard by which actions are judged.

Selling some product which is labeled one thing while being another has two possible causes. Ignorance or malice.

If you are sold a product labeled beef and it contains horse meat, either the meat packer is intentionally deceiving you or the food preparer who bought it from the packer is ignorant. Either way, having a law(regulation) which establishes a standard for product labeling, gives the consumer some expectation of a standard, and justification for action when that standard is violated.

Claiming the regulation(law) will lead to perfection is silly. But, not establishing a standard is equally silly.

Without a law(regulation) requiring truth in labeling, big packer X can call the horse meat beef, and I have nothing to complain about and no standard to expect, since there is nothing to keep them from false labeling.

Anonymous Roundtine February 27, 2013 2:47 AM  

Nuclear reactors can be dealt with several ways. For example, require all nuclear plant workers to live downwind and within the meltdown zone of the plant. If a nuclear power plant melts down, everyone who works at said plant goes to jail for manslaughter. You'd have to pay the workers much more, but I bet safety would be job #1.

Blogger Doom February 27, 2013 2:48 AM  

Regulation is the true beginnings of the broken window theory in practice. Don't go tampering with that world-class moneymaker! Look at how many useless employees are hired to ineptly... well... regulate, the more the betterer. Look at how many small businesses go under and how many big businesses rise through the corruption, heading straight for bankruptcy. Dude, you have no idea what you are playing with!

Blogger redlegben February 27, 2013 2:51 AM  

Roundtine, the OP was about whether or not anyone would notice a complete lack of regulation. I pointed out two cases in which I think people would notice. I'm not talking about the other ridiculous issues.

Blogger redlegben February 27, 2013 2:52 AM  

How do you make them live there...hmmmm...regulation perhaps.

Anonymous Roundtine February 27, 2013 2:52 AM  

farmer Tom,

If there was no labeling standard, Consumer Reports would test the meat and give them results to supermarkets. Then the supermarkets would compete on who has the safest and most accurately labeled food. The market is a brutal regulator. It's only cases where you can't imagine how the market can regulate, such as air and water standards, where some government role comes into play.

Anonymous VryeDenker February 27, 2013 3:00 AM  

If you can sue a seller because he gave you mutton instead of lamb, you don't need regulation. The fear of a lawsuit is sufficient. At least that way the money goes to the person affected instead of the government bureaucracy. Oh wait...

Anonymous Roundtine February 27, 2013 3:03 AM  

Roundtine, the OP was about whether or not anyone would notice a complete lack of regulation. I pointed out two cases in which I think people would notice.

You picked two communist examples. They don't really apply because it is government doing the damage. If we use them as examples, the takeaway is to restrict government as much as possible.

I don't think people would notice the lack of regulation in nuclear power because no one wants a nuclear power plant to explode. It kills the entire industry. And if a plant melts down, it doesn't matter if you regulated it perfectly or not, the political/social/business consequences will be the same.

Anonymous dh February 27, 2013 3:04 AM  

If there was no labeling standard, Consumer Reports would test the meat and give them results to supermarkets. Then the supermarkets would compete on who has the safest and most accurately labeled food. The market is a brutal regulator. It's only cases where you can't imagine how the market can regulate, such as air and water standards, where some government role comes into play.

The market can only work when you have transparency. A small non-profit who publishes a national magazine has some power, but nothing like what is needed.

The example I posted earlier about San Diego restaurants - there are 6,000 of them in one county in one state.

Same thing with food labeling. The NYTimes article that VD linked to barely scratched the surface, and their work didn't follow the trail all the way back to the source, which would be required to correct whatever issue is there.

Finally, with a non-government regulator you have dramatically more likelihood of working the refs. Or simply issuing them a do not trespass order, and blocking their ability to inspect.

The libertarian ideal is very hard to implement when it comes to basic safety standards. Private regulation is difficult or impossible to make work, and other schemes will almost always end, eventually, with reduced commerce.

At the heart of it, regulation is about promoting commerce.

Anonymous dh February 27, 2013 3:06 AM  

If you can sue a seller because he gave you mutton instead of lamb, you don't need regulation. The fear of a lawsuit is sufficient. At least that way the money goes to the person affected instead of the government bureaucracy. Oh wait...

This is fine for trivial matters, but what good is being able to sue the elevator manufacturer if you are dead, and they're out of business?

Secondly, you currently can *sue* the supplier, and it wasn't enough to deter the horse meat/cow meat fiasco.

So how is removing the USDA/FDA completely, and relying only on the already existing 'right to sue' going to do anything except increase the incidence of fraud being done to the consumer?

Anonymous VryeDenker February 27, 2013 3:17 AM  

Secondly, you currently can *sue* the supplier, and it wasn't enough to deter the horse meat/cow meat fiasco.

Neither was regulation. People can't afford the prices of regulated meat, hence an artificial market was created for poopie (look it up). South Africa saw a 40% increase in the price of AAA grade beef in the span of 6 months since tougher regulations were put in place. Suddenly, we're seeing more supermarkets selling low-cost meat from Lesotho where formerly we didn't even know they had cows there. (Dear Lord, I HOPE they have cows there).

So how is removing the USDA/FDA completely, and relying only on the already existing 'right to sue' going to do anything except increase the incidence of fraud being done to the consumer?

By lowering the cost of business, there is less incentive to cut corners. Plus, no-one is stopping a private consumer organization from examining the contents of a product.

Anonymous Roundtine February 27, 2013 3:21 AM  

There's going to be problems either way. Industry controls the regulations now because people believe the gov't is impartial. Taking regulation out of the government's hands would at best give industry the same amount of power, but it would give consumers far more power to shape the market.

This is fine for trivial matters, but what good is being able to sue the elevator manufacturer if you are dead, and they're out of business? But outside of environmental laws, there's no evidence that regulations reduce things such as "elevator failures" and in some cases regulations lead to greater death and injury (such as safety standards).

Blogger redlegben February 27, 2013 3:23 AM  

There is no safety regulation concerned about individuals in those communist countries. Zero-nada.

Imagine a company in Oklahoma that decides it is profitable to build a pipeline from the Great Lakes to the great plains. What prevents them from draining the lakes? Whose property rights are violated without some type of regulation?

Blogger JACIII February 27, 2013 3:24 AM  

Secondly, you currently can *sue* the supplier, and it wasn't enough to deter the horse meat/cow meat fiasco.


How ever did our species survive without all these well meaning, life-enriching bureaucrats for the past few millennia...

Anonymous dh February 27, 2013 3:33 AM  

By lowering the cost of business, there is less incentive to cut corners. Plus, no-one is stopping a private consumer organization from examining the contents of a product.

The cost of business is not why fraud is committed - it happens at all price points.

Secondly, yes, private companies are constantly blocked from examining products. It happens all the time. Crooks don't like to be looked in on. Hidden camera et all only goes so far.

Neither was regulation.

That is not factual. In Ireland, the UK, and Sweden it was regulators who discovered the fraud. Advisories put out by the regulators went to the entire supply chain, and when more suppliers were looked at by the purchasers up the chain, massive fraud was uncovered. Link: http://www.cnn.com/2013/02/10/world/europe/uk-horsemeat-probe

The legal actions are coming well after the fact of discovery. The suppliers in Romania and wherever are going to be gone any day now - bankrupt, and the next supplier in place.

Luckily this isn't really anything more than public relations. Horse meat is not inedible by any means.

But suffice it to say that without regulators you would at best have a claim for a few dollars against a Romanian company. Is that really a deterrent?

Anonymous dh February 27, 2013 3:34 AM  

How ever did our species survive without all these well meaning, life-enriching bureaucrats for the past few millennia...

Well, for one, life was shorter and less enjoyable.

These are 100% first world problems. People in desperately poor countries would eat horse meat, or whatever fish you gave them, without issue or complaint.

Anonymous VryeDenker February 27, 2013 3:40 AM  

Secondly, yes, private companies are constantly blocked from examining products. It happens all the time. Crooks don't like to be looked in on. Hidden camera et all only goes so far.

Then buy a product and examine it. It is not rocket science. Unless you bought a rocket.

As for regulators uncovering fraud: what would have prevented another person or organization from uncovering the same problem? A cattle farmer knows what bovine meat looks, smells and tastes like. It just takes one or two of them to be pissed off and you have the ball rolling.

I note how this is turning into a great argument against globalization.

Anonymous VryeDenker February 27, 2013 3:45 AM  

Well, for one, life was shorter and less enjoyable.

You are of course referring to the period between the fall of Rome and the rise of the West. That's hardly the entirety of human history.

Anonymous Hong Hu Shi February 27, 2013 4:50 AM  

Well, for one, life was shorter and less enjoyable.

Living until 70 instead of 60 is not an achievement of regulation.

iPads are not an achievement of regulation.

Anonymous kh123 February 27, 2013 5:49 AM  

"If you can sue a seller because he gave you mutton instead of lamb, you don't need regulation... A cattle farmer knows what bovine meat looks, smells and tastes like. It just takes one or two of them to be pissed off and you have the ball rolling. I note how this is turning into a great argument against globalization."

This is where I was hoping the conversation would lead. Hence the caveat emptor from earlier.

Anonymous zen0 February 27, 2013 5:56 AM  

The purpose of regulation is to promote professional standards and weed out gross incompetence. It can't prevent fraud. Fraud is an issue of professional ethics.

As (St.) Rothbard stated, one legitimate theoretical role of government is to prosecute fraud.

Unfortunately, in reality, government tends toward perpetrating, aiding, and abetting fraud.

Give up.

Blogger Rantor February 27, 2013 6:16 AM  

If a corporation cares about its brand and image, it will self regulate and do so in a way that provides third party monitoring. They do this in the realm of accounting, as publicly listed stocks are required, by the market, to provide such information.
I just had my car fixed at a BMW dealer and the company, not the dealer, sends me a questionnaire, they are working to ensure the dealer did a good job.

In the world of insurance, inspectors want to see that industrial safety rules are being complied with as a way to mitigate risk. There are numerous ways to allow for regulation of activities in the capitalist environment that do not require the government to establish detailed regulations.

Whether selling cod as snapper, counterfeit luxury goods, or inappropriately rated mortgage backed securities a simple fraud law should cover it. I do not see why we need specific laws to cover all of them. One broad law against fraud and you are done. Shouldn't take more than 10 pages, one inch margins, double spaced.

Of course that takes all the fun out of governing.

Anonymous Roundtine February 27, 2013 6:29 AM  

Here's one reason to regulate.

Anonymous p-dawg February 27, 2013 7:26 AM  

I look at the fish mislabeling, drug recalls, horse meat substitution, etc and I think, "Wow, how ineffective are these regulatory agencies?" dh sees the same thing and thinks, "wow, how much worse would it have been without the regulations?"

One thing I will say is that if you like regulations, you like big companies. One effect of increasing the number of regulations/regulatory bodies in any industry is the consolidation of independent businesses into cartels. For example, before the EPA, half of our oil came from wildcatters - those with fewer than 10 wells. Now, the vast majority of our oil comes from five companies. Is that good? I guess it depends on how you feel about huge corporations.

Anonymous realmatt February 27, 2013 7:28 AM  

Twoooo outaa threeeeee aaaaiiint baaaaad

Anonymous DT February 27, 2013 7:29 AM  

Would anyone even notice if the SEC employees weren't keeping their eagle eyes on internet porn/the markets?

How would the economy survive without this government stimulus to the porn industry, Vox, HOW?

Do you hate the economy? Do you hate porn stars???

Anonymous p-dawg February 27, 2013 7:30 AM  

Here's an example of a regulatory body "helping" people:
Link.

Anonymous DT February 27, 2013 7:42 AM  

Here's an example of a regulatory body "helping" people:

And I'll bet 100% of the meat was deer, unlike meat sold in "regulated" industries.

Anonymous MendoScot February 27, 2013 7:45 AM  

So, apparently it's regulators all the way down. How...novel.

Anonymous DT February 27, 2013 7:46 AM  

Obviously we have a fish control problem. I recommend waiting periods for those buying fish; limits on plate sizes so a person can't overeat fish; and a ban on all assault fish.

Of course we will need new taxes and laws; more Federal employees; and a bigger budget.

For the children...

Anonymous tungsten February 27, 2013 7:49 AM  

"The alternative, by the way, is... you decide: take the risk, or go without?" dh, 1:57am

Yes, how truly horrible for everyone to be left to make their own judgements on these matters. Better to just take the cowardly way out and let some third party decide for all of us.

Anonymous Oh wait February 27, 2013 7:54 AM  

What is the purpose of laws against murder, theft, and rape, given the difference between theoretical legality and its actual results?

I understand why people like the idea of laws. But if they fail as often as they do, do they actually do anything? What would happen without all the expense and effort of government laws, would everyone be murdering, raping, and stealing? Would anyone even notice if the police weren't keeping their eagle eyes on criminals?

Blogger tz February 27, 2013 7:55 AM  

Regulation usually is collusion between business and government taking away or limiting rights. In both the fish and SEC, no individual can easily sue for fraud no matter how egregious. There was the pure food and drug act that was more along the lines of empowering individuals and not government.

Anonymous cheddarman February 27, 2013 8:05 AM  

Regulations give women and gamma men a false sense of security in an "unsafe" world.

Being a regulator is also a lucrative gig, if you can get one.

sincerely

cheddarman

Anonymous Josh February 27, 2013 8:10 AM  

Fraud is already illegal. Regulation hurts small businesses and entrepreneurs, and helps those evil corporations that liberals love so much. Read Joel Salatin on regulation. Every single time there's an outbreak of salmonella, the source is some large factory farm operation that has all the FDA or USDA checkmarks in the right places.

Anonymous Josh February 27, 2013 8:12 AM  

Regulations give women and gamma men a false sense of security in an "unsafe" world.

Bingo.

Anonymous hardscrabble farmer February 27, 2013 8:15 AM  

On our farm we have always sold custom (on farm) slaughtered animals to our customers, i.e. we slaughter and butcher the animal on site and sell either the whole, half or quarter directly to the buyer. About four years ago we became certified by a national organization for our animal husbandry practices in order that we might sell individual cuts at farmers markets and to local restaurants and make a premium on our meats due to increasing awareness of open grazed, grass fed/finished, humanely raised animals. One of the requirements was that any of our livestock had to be slaughtered at a USDA plant that was also certified by this organization in order to have our meats feature their label. This meant I had to truck our animals to the next state.

In five consecutive visits not once was a USDA inspector present at the slaughterhouse- I know because I asked each time because I wanted to speak to them about a couple of concerns. I was told a different story each time- away for the day, failed to arrive, on vacation, etc. I asked specifically if I was paying a premium to have my animals slaughtered in a USDA inspected facility, and there was no USDA inspector available, how exactly was it possible to label the packaged meats as "USDA Inspected". I was told each time that the facility was "a USDA facility", that I would "get my stamp anyway", etc.

Understand that a slaughterhouse is privately owned, not government run. An inspector must actually inspect the freshly slaughtered animal for overall health and or diseases as well as carcass grade. The cost of slaughter at one of these facilities is about 150% higher than if I took it to a custom slaughter facility (local butcher) or if I did it myself (zero cost, I get to keep the hide and compost the remains) plus the additional stress of trucking animals that have never spent a single day of their lives anywhere else but on the open pastures of our farm.

I have had uniformed (yes, uniformed- they look like naval dress uniforms and they even wore ribbons) USDA inspectors wearing guns visit my farm without notice asking to see our records and inspect our operation, but not one time did I ever see one at a USDA plant.

So now we're back to selling our own animals, born, raised, slaughtered and butchered right on the farm for a fraction of the price some pretentious fop pays for factory raised, industrial processed, maybe inspected by the USDA piece of meat from Whole Foods.

What have we learned from this anecdotal tale?

You can't trust labels. You can't trust the Government. You really have no idea how your food is produced or raised unless you go right to the farmer and see for yourself. And most importantly, the whole system is fraudulent but you have to spend top dollar for it, whether at the market or through tax dollars.

A system like that isn't going to last forever and when small time farmers like myself quit trying what are the odds of anyone who doesn't live near one getting healthy food to feed their family?


Anonymous hardscrabble farmer February 27, 2013 8:16 AM  

As an aside-

On my last visit to that slaughterhouse I took two hogs, one about 500 pounds the other about 750, both of which lived in our wood lots foraging for mast their entire lives. As you might imagine they had the look of pigs that lived out doors, dirty snouts and feet, weather beaten hides, but happy and healthy as far as hogs go. When I dropped them off I noticed a stall with about fifty hogs, all identical in size (about 200 pounds), all with their tails and ears docked, milk teeth removed and looking as if they had been power washed. Clearly not a single one of these pigs had ever spent a day in lives out of doors, they had all been docked because of heavy stocking ratios (confined, crowded pigs bite each other a lot due to stress, docking is done to prevent risk of infections).

I asked the manager what the deal was with those animals and his response was "Whole Foods".

I said I thought Whole Foods didn't sell factory raised pigs and he said they bought them from a place called "Happy Pig Free Range Farm" (or something similar). We both stood there looking at each other for a minute and then he shrugged and said "plausible deniability" and that was the last time we ever took an animal to that slaughterhouse.

Anonymous Jurgis Rudkus February 27, 2013 8:17 AM  

I remember days before regulation... I worked at the plant in Chicago where they made "Durhams Pure Beef Lard" with the special ingredient for extra flavor -- don't eat the lard. Eat the fish..

Anonymous szook February 27, 2013 8:44 AM  

In that vein, I am in favor of a very well regulated militia.......

Anonymous Pablo February 27, 2013 8:49 AM  

Part of the problem, said the study’s chief author, Kimberly Warner, is that there are quite simply a lot of fish in the sea, and many of them look alike. Over all, the study found that about one-third of the 1,215 fish samples bought, from 2010 to 2012, were mislabeled.

This sounds like something that should be on Alpha Game instead...

Anonymous Peter Garstig February 27, 2013 8:52 AM  

Regulations on government level incapacitates people. It gives a false sense of security. Also, it reverses power structures. It enforces the notion that the consumer is at the mercy of the producer, while in fact in free markets, the power would lie with the consumer. I said free markets, which is something we don't have. Which leads me to another point: regulations hampers competition, it's a tool to create monopoly and mono-cultures. Competition is the central ingridient for the power to be shifted back to the consumer.

Others already said that regulating power corrupts. On reason for this is that regulating power is a monopoly given to the state.

I have yet to see an example of regulation in this thread that would require government involvement in a free market system.

Anonymous joe doakes February 27, 2013 9:02 AM  

Protect the Public from Bad Practitioners is the rationale for requiring government licenses for every occupation, but how many hairdressers get sanctioned for Bad Hair-dos? How many teachers get sanctioned because Nobody Learned Anything In Your Class? Am I more likely to get sick from bacon-wrapped hot dogs bought from a street vendor than from a restaurant? If not, the license is a waste of time and money.

Blogger JDC February 27, 2013 9:22 AM  

Re regulation - we were informed recently that it is "illegal" for our church to have potlucks (this came from a health inspector). The rationale was that since the food was not prepared on site (e.g. at the state sanctioned church kitchen), the food could not be properly regulated, and therefore posed a potential threat to individuals.

We smiled - and continue to enjoy our sausage and kraut made in 100 year old crock pots.

Anonymous Josh February 27, 2013 9:23 AM  

Am I more likely to get sick from bacon-wrapped hot dogs bought from a street vendor than from a restaurant?

Is that an organic, free range, vegan bacon wrapped hot dog?

If not, it'll probably get banned.

Anonymous Josh February 27, 2013 9:25 AM  

Some state regulatory body just threw out 1600lbs of venison donated by hunters to a homeless shelter because apparently it's illegal for the homeless to eat venison.

Blogger swiftfoxmark2 February 27, 2013 9:42 AM  

Regulations are just ways to enable government-run or government supported cartels. Right now, the FDA is seriously considering allowing major dairy producers to put aspartame in milk. For school children. You know, to cut back on the massive amounts of sugar they get from regular and chocolate milk. Because God forbid the school districts themselves get rid of chocolate milk or the vending machines from their schools.

Oh, and the kicker is that the aspartame won't even show up on the ingredients list on the carton. So the FDA is literally allowing companies to lie to us about what is in their new Diet Milk product.

So yes, let's end all regulations by abolishing all regulatory agencies and let the free market chaos fix everything to meet the consumer demand. Of course this puts a lot of useless parasites out of job, but it's better than having the parasites put all of us in a concentration camp.

Anonymous Josh February 27, 2013 9:48 AM  

Any chance of us putting the parasites in the camps instead?

Blogger James Dixon February 27, 2013 9:56 AM  

> The alternative, by the way, is you asking to inspect the kitchen yourself,

The alternative is to have private agencies whose survival depends on being trusted do the inspections. For an example of what happens when that trust is breached, see Authur Anderson.

If some company or individual refuses the inspections, don't buy from them.

> Private regulation is difficult or impossible to make work,

Underwriters Laboratories.

Blogger swiftfoxmark2 February 27, 2013 9:58 AM  

Any chance of us putting the parasites in the camps instead?

They have more guns and even conservatives tend to say that we need some kind of regulation.

Anonymous The other skeptic February 27, 2013 9:58 AM  

The point of government regulation is to allow government employees to make more money. It's a protection racket within a protection racket.

Anonymous Porky February 27, 2013 10:01 AM  

According to NOAA we import 86% of the seafood we consume. The problem isn't that the tilapia you ordered isn't tilapia. It's that the tilapia you ordered came from a filthy chinese farm where the fish were fed pig feces.

Anonymous The other skeptic February 27, 2013 10:06 AM  

Hmmm, a case where regulations (laws) have been good:

A natural experiment in the effect of gun ownership on crime rates

Anonymous The other skeptic February 27, 2013 10:14 AM  

More on regulations: California's failed education experiment puts the blame almost entirely on Brown and the CTA for the state's achievement scores.

Funny how there is no mention of those hordes of dumbasses from south of the border.

Anonymous Stilicho February 27, 2013 10:26 AM  

It's only cases where you can't imagine how the market can regulate, such as air and water standards, where some government role comes into play.

e.g. to help avoid the tragedy of the commons

Anonymous Stilicho February 27, 2013 10:31 AM  

Any chance of us putting the parasites in the camps instead?

Nearly impossible to contain the contagion. Better to kill the parasites. The Kondratieff Winter may kill off a substantial number of them.

Anonymous Will Best February 27, 2013 10:33 AM  

Regulation is a lot more efficient than litigation after the fact in a number of situations

1) Emissions and disposal of toxins
2) Handling of highly dangerous substances
3) Complex systems involving individuals in chaotic states such as driving or flying.

Most regulations however are designed to be barriers of entry and to provide false assurances to low information types.

Incidentally without regulations people would pay for assurances separately. Consumer Reports, UL, etc would be used more as would warranties. People wouldn't just accept a 3/36k warranty on a car. It would also create a world where retailers would develop relationships with their customers and you would probably see a lot more brand loyalty.

Blogger TontoBubbaGoldstein February 27, 2013 10:54 AM  

Chris Elliot to the rescue!

http://www.youtube.com/watch?v=Dwsa5f9rKAI&feature=youtube_gdata_player

Anonymous Toolbox February 27, 2013 11:00 AM  

The purpose of regulation is to give an advantage to one party over another. It is more clearly seen in some areas than others, but this is why there are lobbyists in DC. SEC regulation helps the bigger companies put the smaller out of business because no one has the lawyerpower to understand or navigate the regulations safely. In the case of restaurants and many other areas, it keeps other smaller ventures out of the business. Licenses and fees as well as dealing with bureaucracies just really kills small business in the money and labor ends, tying up time and funds for something that never was designed to do anything but give advantage to those who got the regulations passed in the first place.

Anonymous Toolbox February 27, 2013 11:07 AM  

In the case of fish, the likely effect of regulation has been to give us fish that we cannot know how fresh it is or the conditions of butchering. If we had to verify with our eyes it was a snapper, then the head and skin will have to be on. At that point, smell for freshness and visually inspect. The result without regulation is a less trusting (though that's up to the consumer), but ultimately fresher and higher quality product. Fish in a restaurant has its own safeguard: reputation and food poisoning fears. A restaurant, regardless of regulations, which has a history of killing its customer base doesn't stay in business long.

Anonymous patrick kelly February 27, 2013 11:17 AM  

dh: "If the consumer is at a serious information disadvantage then he or she is less likely to be confident enough to make a purchase."

Yes, we can plainly see that before the FDA regulations people in the US would not purchase and consume any fish...oh...wait....

What you wrote sounds good, but I'm guessing it would be easy to refute with per capita fish consumption data if any exists.

Fraud covers a multitude of sins, no reason to explicitly prohibit each one separately.

Anonymous dh February 27, 2013 11:23 AM  

JD--

Complete fail on all three. Total failure.

> The alternative, by the way, is you asking to inspect the kitchen yourself,
The alternative is to have private agencies whose survival depends on being trusted do the inspections. For an example of what happens when that trust is breached, see Authur Anderson.

AA is a horrible case - all the investors of firms they audited lost money - billions!! They got convicted of various criminal charges which were all lost on appeal. In fact, AA is free to continue to practice, if they had of been bankrupted.

Forced private arbitration by corporations is the same type of system. It's all voluntary, right? Yet they are owned and operated by the corporations, for the corporations. How is one of these magic private entities going to survive? Either they get in bed with the industry, or they try to convince people to pay them for ratings?

In the end it's commerce that suffers again. It's not the end of the world. Many countries don't have good restaurant regulatory schemes, and good controls on food processing, and it's only every now and then that people get sick, or die. The businesses come and go.

If some company or individual refuses the inspections, don't buy from them.

Right. Commerce suffers again. That is the end result. People won't trust the businesses. And there will be many more businesses that never make it. The chains, and big companies, will continue to thrive because they can advertise and buy fake industry certifications that have no value to the consumer.

Underwriters Laboratories.

Fail. UL's biggest customers are across the board governments. They are the approved testing lab of OSHA. They are used by EPA, Consumer Product Safety Commission, and the equivalents in about 60 countries.

Also, local and state regulations require UL certification in many cases, making them a state protected monopoly.

With no regulation, they don't make it a few months, or they shrink to irrelevance.

Plus, even better, in many jurisdictions the UL is effectively shielded from legal liability for products they certify, even when the certification is proven to be fraudulent or incorrect.

SURELY you can do better.

Blogger TontoBubbaGoldstein February 27, 2013 11:31 AM  

A restaurant, regardless of regulations, which has a history of killing its customer base doesn't stay in business long.

The exception proves the rule. (Perhaps.)

Jack in the Box

In the early eighties.....

Allegedly sold horse meat (as well as kangaroo(!) meat) in its burgers.
Four kids died from eating E. Coli tainted burgers.

Anonymous dh February 27, 2013 11:35 AM  

Yes, we can plainly see that before the FDA regulations people in the US would not purchase and consume any fish...oh...wait....

I think a good comparison would be China, breastfeeding, in 2008-2009. About 2% of babies born and breastfeed got really sick from bad formula.

In the period immediately after, breast feeding picked up. I will work on finding some data to see if it was significant or just a blip.

Anonymous dh February 27, 2013 11:38 AM  

A restaurant, regardless of regulations, which has a history of killing its customer base doesn't stay in business long.

#1 - That doesn't help the dead customers. If I am dead it does not help that the place went out of business.

#2 - The blind faith in markets is silly. All you need is a new sign and a "new management" placard. And all is forgiven.

People get sick and die all over the world from food borne issues. The market has never done a good job regulating them.

Anonymous p-dawg February 27, 2013 11:42 AM  

@dh One third of the fish sold, regulated, mind you, is not what it claims. One third. Of what benefit is regulation regarding food labeling? Was more than one-third of the fish sold before the creation of the FDA mislabeled? If so - then the regulatory body hasn't helped anything. If not, then it's hurt things. In the unlikely event that more than one third of fish was mislabeled before the FDA was created, then I guess mislabeled fish isn't that bad. No matter how you slice it, regulations haven't helped. Do you really believe, in the internet age, that no one would ever know about shady practices by unregulated companies? I mean, we have plenty of youtube videos of shady practices in regulated companies...it seems that personal discretion is advantageous to the practitioner whether regulations are in force or not. The only difference appears to be in the final cost of goods to the consumer. Stupid people will still eat at McDonalds, which, while regulated, will kill them quickly. Smart people will still either produce or source their own food, whether McDonalds is regulated or not. It takes time and effort to produce or source your own food, and you don't want to spend that time and effort, but you want the benefits of doing so. Unfortunately for you and every other worshiper of the State, you STILL have to put time and effort in to something to reap the rewards of doing so. You don't get something for nothing. In this case, you don't even get something for lots of tax money.

Anonymous Toolbox February 27, 2013 11:43 AM  

@ TontoBubba

I wonder how much Jack in the Box paid out in damages for the deaths, eh?

Anonymous dh February 27, 2013 11:43 AM  

Yes, how truly horrible for everyone to be left to make their own judgements on these matters. Better to just take the cowardly way out and let some third party decide for all of us.

This is one way to go, and it's fair and liberty minded. But it will also reduce commerce significantly, dramatically. The problem is and remains that if people don't know, they won't buy. Or they'll buy from someone who has the money to advertise being clean, even if it's a lie.

Regulation doesn't replace your ability to decide. It sets a baseline for where your choices start.

For some industries it's overdone and irrelevant. If you make a bad choice, well next time you'll just choose better. In other cases it's life or death, or serious injury, if you choose bad.

Anonymous p-dawg February 27, 2013 11:46 AM  

@dh "
#1 - That doesn't help the dead customers. If I am dead it does not help that the place went out of business."

How does it help that they paid a fine and stayed in business, then?

Blogger James Dixon February 27, 2013 11:48 AM  

> AA is a horrible case

AA proves the point that if you can't trust the inspector, they go out of business, which is all I said.

Anonymous Toolbox February 27, 2013 11:53 AM  

@ dh

You're totally missing the point of the OP. The regulation isn't a baseline. It's a false sense of security!

The consumer is trusting that regulation will keep the industry in line. But it is being proved that, big revelation, regulations don't work.

Anonymous dh February 27, 2013 11:54 AM  

One third of the fish sold, regulated, mind you, is not what it claims. One third. Of what benefit is regulation regarding food labeling? Was more than one-third of the fish sold before the creation of the FDA mislabeled? If so - then the regulatory body hasn't helped anything. If not, then it's hurt things. In the unlikely event that more than one third of fish was mislabeled before the FDA was created, then I guess mislabeled fish isn't that bad. No matter how you slice it, regulations haven't helped.

#1 - This is surely a case where the regulation isn't that important. The main harm being cured is financial. Being ripped off - charged for something not delivered. Probably not going to be physically harmful to anyone.

#2 - Again, the point is to promote commerce. People who make and sell a quality product - fish - will have no protection against those who will take any fish, clean it, and sell it as something premium. This does affect your ability to get what you want - in that, without the regulatory framework, there will be no recourse for suppliers against each other, other than suits. Suppliers come and go, as do middlemen. It's already a problem that they disappear when problems come up.

The regulatory framework creates the end-to-end incentive for decent people to have a decent living selling an honest product. Otherwise, you get a race to the bottom. Yes, you'll be more free, but you will have consistently inferior outcomes, to the point where you might rather just not buy fish in the first place.

#3 - Regulation is a pre-emption of fraud. Yes, you can always sue after the fact. However, we know that it's not practical. If you buy fish for $4/lb that is only worth $2/lb a pound, what are your damages? $2 dollars. You have no effective recourse against this harm. I suppose we could cook up some sort of streamlined approach to dealing with these torts.

#4 - For those claiming "general fraud laws are enough", more or less, it's false. A criminal violation requires proof of a guilty mind. The retailer will blame the supplier, the supplier will blame the middleman, etc up the chain. In the end someone out of jurisdiction is probably the guilty. Law-enforcement isn't going to deal well with this. It will relegated to a civil matter. See #3.

Anonymous Slowpoke February 27, 2013 11:59 AM  

How about another failure, this one is easier for the regulators to detect. 76% of all honey bought from grocery stores is NOT honey:

http://www.foodsafetynews.com/2011/11/tests-show-most-store-honey-isnt-honey/#.US460vKMDGo

We could do a list but the failures happen faster than they could be added to the list.

Anonymous dh February 27, 2013 12:00 PM  

You're totally missing the point of the OP. The regulation isn't a baseline. It's a false sense of security!

The consumer is trusting that regulation will keep the industry in line. But it is being proved that, big revelation, regulations don't work.


I am not disputing that. Many regulations don't work. Food supply is notoriously difficult to regulate. Read "The Jungle", this isn't new.

But also notice what's not in the article. Discussion of the actual regulation.

And guess what - the FDA doesn't regulate the labeling of fish for resale. It's specifically exempted.

http://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfcfr/CFRSearch.cfm?fr=101.100

That's why the trade group flack said that the government should enforce existing "fraud" laws.

This isn't a regulated function to begin with! That's this is a great example of why private regulation (voluntary) or other schemes which rely on good will are simply bound to fail.

Anonymous dh February 27, 2013 12:03 PM  

How about another failure, this one is easier for the regulators to detect. 76% of all honey bought from grocery stores is NOT honey:

Guess, from your own article, we find that FDA doesn't regulate the claims to be "honey". It's not something that's regulated. How can you blame a mythical regulation for not working?

Anonymous dh February 27, 2013 12:05 PM  

@dh "
#1 - That doesn't help the dead customers. If I am dead it does not help that the place went out of business."

How does it help that they paid a fine and stayed in business, then?


The concept of regulatory is pro-active enforcement. A violation is found before it's reported via dead customer. And a fine is imposed to prevent re-occurrence. The fines and arrangements that allow the business to not be shutdown involve a settlement where the company agrees not to re-offend. And decent regulators watch more closely for a while to make sure the consent agreement sticks.

Anonymous Jack Amok February 27, 2013 12:05 PM  

Good grief we have some regulatin' lovin' folks. Like any good liberal, dh and rountine make their assumptions about how regulation ought, in theory to work, declare it a success, and wander off completely oblivious to how it actually, in practice functions.

None so blind as those who will not see.

Anonymous dh February 27, 2013 12:08 PM  

AA proves the point that if you can't trust the inspector, they go out of business, which is all I said.

AA doesn't prove that point. AA went out of business because Enron blew up, and investors lost billion of dollars. IT shows the non-government private market based auditing system is not sufficient to protect investors and the public from bad actors.

AA would be a success story if AA blew the whistle on Enron early in their fraud, and Enron's board/shareholders corrected the underlying fraud. Notice how that never happens.

Anonymous Wendy February 27, 2013 12:10 PM  

This is one way to go, and it's fair and liberty minded. But it will also reduce commerce significantly, dramatically. The problem is and remains that if people don't know, they won't buy.

Or not. There is plenty of information out there about McDonald's nasty food, yet people still eat there.

What's the alternative if there's no regulation? The mom and pop restaurant that's been open for years. And you don't have to inspect the kitchens. Inspect the bathrooms. Buy direct from farmers you know. Grow your own. All the rest who don't care will go on as they always have, regulations or no.

Anonymous Toolbox February 27, 2013 12:11 PM  

@ dh

Yours is a typical static view of the economics of regulation. One of the complaints about a race to the bottom is false. But don't we see big corporations running all over the consumer in X area? Yes, but keeping in mind those big corporations wouldn't exist at all if it weren't for draconian tax and other regulations, if we didn't see those large protected corporations, the base problem begins to leave.

I would challenge you to show me any regulation that works in a non-static environment: one that we just can't live without and one that does what it says it does. I haven't found one yet and I've rejected all those to which I used to cling.

Anonymous Wendy February 27, 2013 12:11 PM  

AA would be a success story if AA blew the whistle on Enron early in their fraud, and Enron's board/shareholders corrected the underlying fraud. Notice how that never happens.

Aren't there regulations in place?

Anonymous HH February 27, 2013 12:12 PM  

The effect of the free market and its ability to self regulate is way over rated. If all regulations disappeared tomorrow how long before we started having company stores, private police, 80 hrs work weeks, child labor, ... those who forget history are doomed to repeat it .. we already know what no regulation, free markets looked like .. what makes anyone think business is any less greedy than they were was back then....

Anonymous dh February 27, 2013 12:15 PM  

Good grief we have some regulatin' lovin' folks. Like any good liberal, dh and rountine make their assumptions about how regulation ought, in theory to work, declare it a success, and wander off completely oblivious to how it actually, in practice functions.

None so blind as those who will not see.


Well granted this is true. Regulation often does not work perfectly. Or never does.

VD asked the rhetorical question of why even attempt regulate. I am answering that. In the general.

I would address the specific case, but in this specific case, there are no underlying regulations on the topic. Which basically proves the point that regulation is worthwhile as a general endeavor.

The specific examples that people are pointing out are just bad ones. They so far are basically arguing that regulations that don't exist didn't work. It's pretty silly to argue not to have regulations, and then further argue we shouldn't have them because the very regulations we don't have didn't work.

On the other hand, I have specifically relied on several cases of actual regulation, doing a nice job.

I could go either way on it. I've lived in parts of the world with no effective regulation and it's not the end of the world. In the end, you just don't trust anything. Every transaction is a chance to be screwed. You buy a cup of a coffee from a vendor on the street, you better check it before you walk away. Because if the guy just poured hot water in your cup and took your money, you are out $1. Buyer beware. Buying a train ticket at the ticket station? Better hope it's not just a worthless forgery you bought from a fraudster while the actual ticket person was at lunch.

It's tempting to look at the large regulatory system we have and think it does nothing useful. And I am sure that there are very many that are just hopelessly pointless. But the net effect is an increase in commerce, because people trust the system to provide a sound environment for a transaction to happen in good faith.

Anonymous hardscrabble farmer February 27, 2013 12:15 PM  

Another anecdotal example.

Several years ago we began to raise tilapia with the intent of producing them for commercial consumption locally (within our state- restaurant/consumer level).

We had to navigate through the DEP, HHS, Fish and Game, Department of Weights and Measures, Food Safety and the FDA. There were a total of six licenses, four permits and several independent third party obligations (water testing, supplier compliance certifications, etc. ALL of this BEFORE we had raised a single fish. None of this included the costs associated with equipping and setting up a facility. We received ZERO government financial assistance, zero loans, but we were determined to produce these fish based on what we knew about depleted fisheries,heavy metal contamination,carbon footprint (90% of all farm raised fish in the US comes from more than 5,000 miles away) and practices associated with tilapia production in Asia (feeding raw human and animal feces to the fish).

After more than two years without having sold a single fish (due to ever expanding requirements from the above listed regulatory agencies) we implored our state representative to intervene on our behalf.

At that meeting I brought a pound of our freshly filleted tilapia which was as yet prohibited from sale in my own state to our own loyal customers and a pound I purchased at the grocery store down the street from the State Capitol. The two samples had been tested at an independent laboratory at my expense for bacteria and pathogens. The only difference between the two was that mine had been filleted that morning and the sample imported from Asia had been boxed six weeks earlier and had been approved for sale by all the above listed agencies. The pathogen level of the import was over 800% higher than ours.

The result of that meeting was an elevated level of hostility at our attempts to raise healthy fish raised locally and our eventual cessation of aquaculture in the State.

The tilapia from Asia can still be purchased anywhere in our state, and no one currently produces it here now.

If someone can tell me how those multiple levels of regulation benefits the health and welfare of the citizens of the United States, I am all ears.

Anonymous dh February 27, 2013 12:17 PM  

Aren't there regulations in place?

It's self-policing. The outside auditors do the books, and submit them to the board. The board reviews and accepts. The shareholders elect the board. The board hires the executive staff. The abstract of the audit gets published to potential investors. All self-policing, all the way around.

Anonymous p-dawg February 27, 2013 12:22 PM  

@dh "#3 - Regulation is a pre-emption of fraud. Yes, you can always sue after the fact."

Not in heavily regulated industries where you are subject to "binding arbitration" instead. One example of that is the pharmaceutical industry, when a vaccine is alleged to have harmed someone. So, no, no you can't always just sue. This is a direct result of regulation. So, you previously said that a company going out of business as the result of lawsuits doesn't help the dead. Does binding arbitration help the dead? Does it provide a better result for the survivors than getting enough money to put a company out of business? And, when companies are found in violation of FDA regulations, they aren't sued to provide benefits to those they've harmed. They're fined by the FDA to provide money to the FDA. And then they're allowed to continue operating. In the most egregious cases, they might be shut down and MAYBE in the case of fatalities there might be criminal charges filed against someone. None of that pays anything to the victims, and if jail time is involved, the victims are even taxed to jail the people who harmed them. And this is a good result, in your mind. Boggling.

Anonymous dh February 27, 2013 12:27 PM  

Yes, but keeping in mind those big corporations wouldn't exist at all if it weren't for draconian tax and other regulations, if we didn't see those large protected corporations, the base problem begins to leave.

I disagree on this front, and I think the evidence is my favor.

1. Corporations that were large and abusive predate the modern regulatory system. So as a simple cause and effect, it can't be conclusively stated that one follows from the other. I would certainly agree that most regulations favor larger and more complex companies.

2. You must examine the alternatives. A system with far fewer, or even no regulation, favors those with more asymmetric access to customers - i.e. those we can advertise. Regulation does impose a minimum floor on the size and type of business. But it also provides a baseline of trust. Without that trust, the large corporations can simply blast out whatever they want to access consumers. The cold comfort that after years of litigation a small business may win a lawsuit against a big company does no good in the immediate term.

I said a few times before and I really mean it, I am not tied to regulatory systems like we have now in this country. I could go both ways. I think that businesses of all sizes have the largest interest in protecting the status quo, because they are ones who benefit from the regulation.

Anonymous hardscrabble farmer February 27, 2013 12:31 PM  

An aside-

On my last visit to a large east coast metropolis i saw a brown, squat amerindian-looking street vendor squatting on the curbside dipping bananas on a stick into a large bucket of mayonnaise and then coating it in rock salt that was in an aluminum foil pan. That was the sum total of his operation- no gloves, no food truck, no sign, no hair net, no refrigeration, sneeze guards. His clothes were filthy and there were at least three or four similarly related phenotypes standing in line waiting to be served.

Some folks are absolved of compliance to any regulation due to their status.

BTW, who eats that?

Anonymous dh February 27, 2013 12:38 PM  

One example of that is the pharmaceutical industry, when a vaccine is alleged to have harmed someone.

This isn't arbitration, it's black letter law. Congress exempted them from almost all liability, and setup a weird system to compenstate you if something bad happens.

Same with binding arbitration, which I mentioned above as a farce. Congress has imposed that on us, basically whitewashing the ability to access real courts.

And this is a good result, in your mind. Boggling.

Not exactly. To start, with arbitration, I am strongly against these developments. It's a pro-corporate sham end-to-end. I am just pointing out that these are not the result of some sort of benevolent happenstance, Congress has engineered it this way.

Secondly, regulatory action is separate from any private tort. A company who has violated some standard that the FDA, for example, regulates, will have whatever fines and penalties are inculcated from that activity. But a private claim of action is not precluded by an FDA agreement. In fact, FDA findings can and often are the basis of private legal action. In some cases you'll see the FDA or agencies go after the offenders and make civil settlements part of the regulatory action.

For example, this case the FDA sued a drug maker and the whistleblowers receive a portion of the award (In this case millions of dollars) Link: http://www.justice.gov/opa/pr/2012/May/12-civ-585.html. Mean while actions - class actions - are moving against the maker as well.

The regulatory system is on top of the existing legal framework for dealing with torts. If the regulatory system was dismantled, on a personal basis, you'd be exactly where you are now.

Anonymous dh February 27, 2013 12:39 PM  

Some folks are absolved of compliance to any regulation due to their status.

It's a never ending battle against these folks.

Blogger IM2L844 February 27, 2013 12:45 PM  

People get sick and die all over the world from food borne issues. The market has never done a good job regulating them.

Neither has the government.

Liberals are always heavy on defending concepts and always light on offering solutions for the systemic failures of the concept's implementation.

The regulatory system may be a pragmatic necessary evil in the real world, but it will continue to be an extraordinaily inefficient and intrinsically corrupt hit and miss system until we accept and admit how seriously broken it is and find a way to severly punish the large percentage of the so called public servants who are failing to do the jobs we need and pay them to do. We have, somehow, got to up the ante and incentivize benevolence through much stiffer mandatory negative consequences for both dishonorable and indolent regulators.

Blogger foxmarks February 27, 2013 12:47 PM  

I have some sympathy with dh’s position on this one. Applying a remedy after the poisoned food is sold or after the plane crashes may improve the rate of compliance, but it doesn’t bring the dead back to life. A wasteful and sometimes capricious gov’t regulatory body at least has the advantage of sometimes actually stopping a threat before teh childrenz die.

I am not sure I agree with dh here: “with a non-government regulator you have dramatically more likelihood of working the refs”. At least at the petty city and county level where I operate, the refs get worked all the time. A regional board or other private certifying body wouldn’t be open the corrupt influence of regular election cycles.

Wherever sufficient power is concentrated, corruption will appear.

One way to move to a more effective balance between gov’t regs and private certification might be to shine more daylight on any potential problem. Let gov’t inspection reports be public, and expand eBay-like consumer rating systems put more of a business’s practice in common view. Sure, there will be bogus axe-grinding. But we get to use the power of general public opinion as the regulatory body instead of just a gov’t bureaucrat or Consumer Reports.

Anonymous dh February 27, 2013 12:48 PM  

If someone can tell me how those multiple levels of regulation benefits the health and welfare of the citizens of the United States, I am all ears.

Obviously a big fail. Aquaculture is incorrectly regulated as industrial activity in most states.

If you lived in a state that had better regulations in place you may have succeeded - for example Washington state passed a law in 2007 to create a regulatory process that was unified and specific to aquaculture only (link: http://www.ecy.wa.gov/programs/sea/shellfishcommittee/index.html).

After they produced recommendations the state legislature put them in place and since 2011 they have been in effect.

And now as a result Washington state is the 1st or 2nd leading state in aquaculture/farm raised production nationwide.

Anonymous hardscrabble farmer February 27, 2013 12:51 PM  

"It's a never ending battle against these folks."

Do you mean it's a never ending battle against non-White illegal immigrants who are absolved of complying with the laws that citizens are compelled to observe? Or do you mean it's a never ending battle against the Government that gets to pick and choose which regulations it decides to implement and enforce?

Anonymous dh February 27, 2013 12:53 PM  

Neither has the government.

Liberals are always heavy on defending concepts and always light on offering solutions for the systemic failures of the concept's implementation.


I don't agree with this. I think the burden is on the folks who want to dismantle the entire system to explain how it will play out.

Liberals, in my experience, are happy to continue to improve regulations. I linked above to Washington state's 3-year effort to promote aquaculture by removing and replacing regulations with ones better suited to the industry. And it has turned out to promote increased commerce. Imagine that.

of the so called public servants who are failing to do the jobs we need and pay them to do. We have, somehow, got to up the ante and incentivize benevolence through much stiffer mandatory negative consequences for both dishonorable and indolent regulators.
I agree with this. I am generally against immunity for government employees, except in limited circumstances.

I also think we have to really push the attitude many take to regulations is that they are something to be worked around. In some societies, it's sort of expected you will circumvent or flaunt the regulations. It's a dangerous place to go. We need to trim back the levels to the lowest level, and focus on a small band of really bad problems. The effect of too much regulation is a culture of evasion, and that's a real serious problem.

Anonymous dh February 27, 2013 12:54 PM  

Do you mean it's a never ending battle against non-White illegal immigrants who are absolved of complying with the laws that citizens are compelled to observe? Or do you mean it's a never ending battle against the Government that gets to pick and choose which regulations it decides to implement and enforce?

I mean from my office window I see unauthorized vendors selling things all day, and when the man comes, they scatter. He may get 1 or 2, and maybe some left over gear, but that's all.

Anonymous dh February 27, 2013 12:57 PM  

. A wasteful and sometimes capricious gov’t regulatory body at least has the advantage of sometimes actually stopping a threat before teh childrenz die.

It happens probably by random luck as much as anything. Eventually it will turn up.

Some agencies are better than others. A lot of depends on how well an industry wants to co-operate.

The video gambling industry is a great example. I've seen a sliver of it. These machines - video gambling machines - they are highly regulated. And most of the regulations are asked for by the makers. Because if gamblers don't trust it's on the up and up, they won't put in their money. And that's death to the makers. Casinos and manufacturers have intense interest in making sure that it works as advertised.

A removal of these regulations would just kill the industry. Is it the end of the world if the industry dies? Absolutely not.

Blogger IM2L844 February 27, 2013 1:00 PM  

Liberals, in my experience, are happy to continue to improve regulations.

Exactly. That's my point. It's not the regulations that are in dire need of improving. It's the regulators.

Anonymous hardscrabble farmer February 27, 2013 1:04 PM  

"If you lived in a state that had better regulations in place you may have succeeded - for example Washington state passed a law in 2007 to create a regulatory process that was unified and specific to aquaculture only (link: http://www.ecy.wa.gov/programs/sea/shellfishcommittee/index.html).

After they produced recommendations the state legislature put them in place and since 2011 they have been in effect.

And now as a result Washington state is the 1st or 2nd leading state in aquaculture/farm raised production nationwide."

Actually my state has virtually zero regulations in regards to aquaculture- in fact in 2011 they ceded all regulation to the Feds. The problem comes not in the form of bad or even flawed regulations, but of multiple, overlapping, contradictory regulations that often have no responsible party willing to accept the final authority as to who or what equates to compliance. Furthermore definitions between agencies regarding words like "meat" and "processing" make it impossible to comply because compliance in one area is a violation in another.

As I heard more than once from more than one of these functionaries, "in the absence of any regulation, you are not free to do it (raise fish)."

The ultimate irony was in having a 350+ pound "Food Safety Compliance Officer" tell me that "McDonalds would be a good role model for how to do things right" and that "This is the 20th century (sic) food shouldn't come from farms."

True story.

I understand the points you are trying to make, but you are wrong on so many levels about so many points and the overwhelming evidence is such that every additional regulation not only does little if anything to protect the health and safety of citizens, it is proactively injurious. I don't blame you for your ignorance- I assume from everything you've written thus far that you have no firsthand knowledge of food production- but I do blame you for promoting that ignorance to others through repeated attempts to defend that which you clearly don't understand.

HTH

Anonymous Anonymous February 27, 2013 1:08 PM  

Casinos are also a massive fan of regulating to the point of banning online gambling. I think it's less to do with protecting the consumer and more to do with killing the competition.

And given that your odds of winning it big are next to nil in the lottery and yet people are still willing to throw their money at it, I do not know why you assume they would stop doing so because gambling was unregulated.

If they REALLY wanted to be transparent about it, they could always publish the result of every betting transaction. I’m guessing they don’t want to do this because they want people to believe it ‘works as advertised’ not how it works in reality.

And finally, if an industry is so inherently corrupt that it can’t survive without the government, then let’s let it die. But as you say, the casinos have a massive incentive to prove they are on the ‘up an up’ – I’m sure they can come up with some solution that doesn’t require the taxpayer helping them out.

- Alexander

Anonymous bob k. mando February 27, 2013 1:09 PM  

redlegben February 27, 2013 1:47 AM
2. Nuclear reactor safety in the US vs. Chernobyl.




Fukushima was a US design.

and it should terrify you that ANY engineer, ever thought that it was a good idea to install a nuclear waste cooling pooling 50' up in the air. especially near a fault line.

it actually seems as though it was designed to fail ...

i wonder how many US reactor installations are near fault lines?

Anonymous rycamor February 27, 2013 1:21 PM  

hardscrabble farmer February 27, 2013 1:04 PM
As I heard more than once from more than one of these functionaries, "in the absence of any regulation, you are not free to do it (raise fish)."

The ultimate irony was in having a 350+ pound "Food Safety Compliance Officer" tell me that "McDonalds would be a good role model for how to do things right" and that "This is the 20th century (sic) food shouldn't come from farms.


It takes a special kind of effort to be that stupid, but the U.S. has always been the "can do" country.

Anonymous rycamor February 27, 2013 1:23 PM  

Really as far as honest, small-scale farming goes, the time for regulatory revolt will coincide with the time for tax revolt in this country. It is coming. Once enough people start ignoring the bureaucrats, what are they gonna do?

Blogger JaimeInTexas February 27, 2013 1:25 PM  


Anarchy has it's strong points.
It tolerates rogue apostrophes, for example.


LOL.

Eats, Shoots & Leaves: The Zero Tolerance Approach to Punctuation
http://www.amazon.com/Eats-Shoots-Leaves-Tolerance-Punctuation/dp/1592402038

Blogger foxmarks February 27, 2013 1:25 PM  

It happens probably by random luck as much as anything.

I actually give the thugs more credit. By forcing inspections on all entrants, more errors will be found. That isn’t just luck. It’s a version of “overnight success” happening after years of hard work.

I don’t like the coercion, but even flawed quality control is better than no quality control.

Anonymous dh February 27, 2013 1:26 PM  

I understand the points you are trying to make, but you are wrong on so many levels about so many points and the overwhelming evidence is such that every additional regulation not only does little if anything to protect the health and safety of citizens, it is proactively injurious. I don't blame you for your ignorance- I assume from everything you've written thus far that you have no firsthand knowledge of food production- but I do blame you for promoting that ignorance to others through repeated attempts to defend that which you clearly don't understand.

I own a farm (granted, small - 220 acres) that produces livestock and some crops.

Ceding the regulations to Fed's is in fact a perfect example of how not to promote commerce. Your example is a perfect one of why appropriate regulation is important. Having no regulation hurt you because of the overlap, the incompetence, and the lack of anyone accountable.

Bad regulation or no regulation = bad for your business.

Move to Washington state. They have created a regulatory environment where you know you are in compliance. And that puts you on even footing with the imported fish farmers who only have a patchwork of regulation to deal with. So I guess that's where we differ on the value of regulation. If your state wanted to promote a new industry, they would have exempted you from other regulations and you would have had a clear regulatory path forward. Instead it was a mess and apparently turned it over to the Feds.

Blogger ajw308 February 27, 2013 1:26 PM  

When I was a kid, it seemed that every piece of beef my mom bought had a blue USDA stamp, or two, on it. Not that it really meant anything, but you don't even see those anymore. They don't even pretend to leave evidence that they are inspecting beef.

Last time my boss went to the lower 48 he told me that he was in a restaurant that had "Fresh Alaskan Salmon" advertised as a special except he knew it was months away from a Salmon season in AK. This probably happens a lot, knowingly and unknowingly.

My suggestion, get Netflix and start watching the food documentaries on it. You'll see that the food environment in the US isn't what you hoped and believed it was. After a little bit of looking, you'll find that there is a local farmers market with lots of organically grown produce. If you're lucky, you'll have a 'nutty' (as in walnuts & pecans *wink*) sister-in-law who'll cook some (nearly) vegan meals and desserts for you that aren't just edible, but are actually pretty good.

Buying food from known sources (other than growing it yourself) is probably the only way to really know what you're getting.

Anonymous dh February 27, 2013 1:28 PM  

Really as far as honest, small-scale farming goes, the time for regulatory revolt will coincide with the time for tax revolt in this country. It is coming. Once enough people start ignoring the bureaucrats, what are they gonna do?

There's really very little I have to do deal with. 90% of crap I have to deal with comes from packers, not the government. If we get to revolt against them, sign me up (just kidding).

Anonymous Edjamacator February 27, 2013 1:28 PM  

Sorta OT, but it looks like the GOP cowards can't hand power over to Obama fast enough.

Anonymous hardscrabble farmer February 27, 2013 1:43 PM  

DH,

Well, I certainly owe you an apology for assuming you were uninformed about farming, you've got me beat by more than a hundred acres and frankly I don't know how you do it while simultaneously holding down a job in a city whereyou can observe the goings on below. That would be a herculean task for anyone and I tip my tattered and sweat stained hat to you.

However, it isn't the lack or absence of regulation that hurts me, I produce exceedingly high quality products on my farm with the help of my wife and children and with virtually input from any governmental body whatsoever- excepting taxes and fees of course. The doing part is exceptionally easy to accomplish if one has the passion for it. Its the going through the motions of trying to be a good citizen and attempting to broaden my market from on farm sales to those restaurants and customers who would benefit from what I produce if only we were able to provide the imprmatur of regulatory compliance, whether it delivers real or imagined results.

My family's health and our loyal customers are all the feedback I need as to how well I am complying with the most important thing I do- providing healthful, humanely raised, nutritious meats and produce at a fair price while improving soil tilth and water quality.

Again, it is anecdotal, but increasingly my friends who do farm are simply quitting production due to regulatory burdens or simply dropping off the radar and doing what they do with ZERO compliance.

How this benefits America, either economically or in terms of health, is quite beyond my capacity to understand.

Blogger IM2L844 February 27, 2013 1:57 PM  

Anarchy has it's strong points.
It tolerates rogue apostrophes, for example.


LOL.

Eats, Shoots & Leaves: The Zero Tolerance Approach to Punctuation
http://www.amazon.com/Eats-Shoots-Leaves-Tolerance-Punctuation/dp/1592402038

Ha! The depths of my grammatical ineptitude are only exceeded by my disdain for militant nigglers.

Anonymous Porky February 27, 2013 2:05 PM  

dh: If you lived in a state that had better regulations in place you may have succeeded - for example Washington state passed a law in 2007 to create a regulatory process that was unified and specific to aquaculture only

You simply don't get it, dh, and probably never will from my experience. Regulations are not for making cleaner, safer food. Regulations are not for helping small local businesses. The hundreds and hundreds of regs that this progressive regime is cranking out every single month are for one reason and one reason only - to satisfy powerful special interests.

If regulations were truly designed to give us safe, healthy fish then why are we buying dirty fish from 5000 miles away? Simple - because some lobbyist wanted it that way and paid the administration a shitload of money to get it that way. You've seen the headlines - a measly 500,000 bucks gets you an audience with the President himself. Influence is cheap, and apparently very effective.

Get it? Environmental lobbyists say they want you to buy dirty fish from China, then pay off the government interests who pass a few regulations, and guess what?!? You get to buy dirty fish from China!

I am not surprised at all by the above comment about how the farmer's legislators became hostile when he pointed this out to them. Clean, locally produced healthy fish are a THREAT to the politicians way of life. Clean, fresh fish are something to be stamped out, eradicated, and punished out of existence. They are harming the greater cause.

Do you understand? Do you get it? No of course you don't and probably never will. Naive little sheeples like yourself don't even realize the horrific extent of the damage you cause.

Anonymous dh February 27, 2013 2:16 PM  

Well, I certainly owe you an apology for assuming you were uninformed about farming, you've got me beat by more than a hundred acres and frankly I don't know how you do it while simultaneously holding down a job in a city whereyou can observe the goings on below. That would be a herculean task for anyone and I tip my tattered and sweat stained hat to you.
I JUST OWN IT. Don't tip your hat. I just handle some of the business. Luckily I have family who knows what they are doing!! I am lucky if I can find the right side to feed!

Anonymous RedJack February 27, 2013 2:17 PM  

dh,
As someone who works in a highly regulated industry (food and pharma feed stock), regulation is a joke.

A joke. It is at best a once a year visit announced well in advance. More often a lot of paperwork that is showed at him or her when they show up.

If you are a large firm, you don't even get that. Enough money placed in the right hands means you don't worry about inspectors. If you don't have the money, and your competition does, expect to see that inspector a lot.

Anonymous dh February 27, 2013 2:24 PM  

I am not surprised at all by the above comment about how the farmer's legislators became hostile when he pointed this out to them. Clean, locally produced healthy fish are a THREAT to the politicians way of life. Clean, fresh fish are something to be stamped out, eradicated, and punished out of existence. They are harming the greater cause.

Okay let's just step back for a second. The purpose of regulation is to promote commerce. You can believe that or not, but that's the goal. Regulation is a conduit to business. A lack of regulation is not a pure free market, it's a free for all. A free market dictates regulations that preserve transparent transactions.

Secondly, I would strongly suggest you think for a minute which side of the ideological divide is more interested in promoting locally sourced, locally grown, locally consumed products. It's not the right, and it's not the party of free trade and globalization and far-off production. I happy not tar your opinions with broad brush, but would appreciate the same in return.

Finally, you are entirely wrong. I suspect you are one of the many people who believe that rule making is going on at a breakneck pace. It's not. I suspect you are one of the people who believe that pages in the Federal register equals new regulations. They don't.

I am 100% certain that special interests are stacking the deck against smaller players via regulation. That is the nature of "working the refs" - you want to win, you get the deck stacked in your favor, or at least, not stacked in your competitions favor.

However, the opposite of this is not "no regulation", which is rhetorical device that VD posted. He asked "why regulate at all".

The answers are given throughout this post. What you are trying to ask for is a justification of whatever regulation has you in a bunch today.

Anonymous Jake February 27, 2013 2:24 PM  

It's not perfect. But organizations like the UL/ETL are a better model of how to do safety/quality regulations than government bureaucracies.

Differences are as follows:

A) With a UL listed product, I pay ~$500-$1000 for the relevant product standard and maybe another $200 for a few general standards and I have a comprehensive set of documents with every requirement my product will be expected to meet. Further, these requirements are the same across the world. The first (and one of the most difficult tasks) in complying with government regulations is just finding out what the regulations are. It very much seems sometimes that they want to keep them secret, either to be able to fine you for violating them or so they can shut you down (since the regulations were probably written by your competitor anyway). And then you find that the city of Chicago has it's own set of requirements that differ from any other body of requirements. So after 20 hours calling various officials in Chicago and getting nothing but run-arounds and evasion your client gives up on selling into Chicago (true story).

B) Most UL requirements for products will be open-ended, meaning they don't specify HOW to make it safe but rather indicate what conditions the product will be subjected to and how it must (or must not) behave in response. This is 180 degree opposite from most government-driven regulations which simply say "you must use XYZ to prevent fire" (usually written by someone selling XYZ of course). This approach tends to not have the technology and innovation suppressing effects of government-style safety mandates. UL requirements makes mandates too, but less of them, and most labs are more reasonable in how ithey're enforced (see below)

C) UL and other private test labs have to strike a balance between listing products (which is a big part of how they get paid) and maintaining their reputation (which is why their listing is desired at all). What this means is they have to exercise common sense rather than being doctrinaire. Example: A product I worked on had been in production for several years with ETL listing. A change in the relevant standard came into effect which made the product not in compliance with the updated standard. ETL was ready to say "take our sticker off your product" but my client was able to get on the phone with a senior inspector and make his case of how applying the requirement to his product made no sense in the first place and how his product had additional safety features NOT required by anyone which effectively served the same purpose as the new UL mandate. ETL agreed with a waiver to allow him to sell down his current inventory before making the change to come back into compliance. I don't think many bureaucrats would have either the authority or desire to exercise such discretion.

Anonymous Jake February 27, 2013 2:24 PM  

D) Speed: Getting a product through testing at a private lab might takes a few weeks as long as you've gotten yourself in their queue which might be a month or two out. Getting your hands on the standards you need takes 15 minutes, getting an answer or clarification on something within the standard might take from an hour to a business day. I can buy a UL standard, read it, put together a list of questions, and get them answered BY THE PERSON WHO WILL BE EVALUATING MY PRODUCT faster than I can get on the phone with someone at a gov. office who even knows the regulation in question exists.

E) Finally, UL compliance is voluntary. There are no laws mandating it (at least in most areas). Instead Walmart, Target, Home Depot, etc... say "we're not interested in carrying your product with a UL or ETL listing" and the product liability insurers say "your premiums are going to be much higher if you don't have a certification". Further it's not monopolized. UL writes the requirements and will test and certify products as meeting them, but ETL and several others will do the testing as well and give their certification. All of this means that if UL ever got corrupt with the kind of regulatory capture that is the norm in gov. regulation they would cease to be the authoritative body they are today and be replaced by some other organization who was better able to ensure safety without driving up prices.

Could the same be done with food? Probably. The big-name places might pay for the service and display a certification that their food and its supply chain are routinely inspected by UL or whoever. Your small farmer probably would just say "you wanna see my supply chain just drive over and I'll walk you through my barn" and you'd probably have bargain basement shops who didn't get certification and just relied on their good name or catered to people who'd rather have mystery meat than pay a premium for all the inspections. This approach leads to more competition, less threat (and less motive) for mega-corp A to re-write the rules for it's own benefit (which is the source of probably 90% of all so-called safety regulation) and leaves the consumer with the choice to pay for the added safety or not.

OpenID ZT February 27, 2013 2:25 PM  

Uhhhh ITS FOR THE CHILDREN!

Anonymous Toolbox February 27, 2013 2:25 PM  

@ dh

Concerning your point #2 way above in reference to my assertions. According to interpretations from information from this book: http://www.amazon.com/The-Triumph-Conservatism-Reinterpretation-1900-1916/dp/0029166500 Gabriel Kolko in the first decade after 1900, there was "too much" competition and the larger companies were dying out, losing out to smaller concerns. The host of federal regulation in response cemented the large corporation's place in our nation, and killed a lot of competition. The writer of the book probably saw the whole thing as good...

But I can see it's pretty useless to argue with someone when his basic assumptions are that regulations can do good things. I would never agree with this. Humans are not endowed with the right to regulate, nor the intelligence. I've not seen the effect of regulation be good. It always causes unintended consequences and ultimately, more harm than good.

I don't accept that, in the age of information, the default position is that regulation is good and the burden of proof is to show regulation is going to be better. Apparently, no amount of proof that regulations cause death, disease, imbalance of power, non-competition is enough. What has to be proved is, right here and now, no regulation has empirically better results. There is no evidence on that. Where are we to look in this nation where there is no regulation? Even the Amish are regulated and raided. What we do know is and can prove is, regulation hasn't turned out so well. I reject the notion is "regulation hasn't been done right is all". Yes, and communism didn't work because the people doing it didn't do it right.

What we do know is, in principle, we operated here as a nation very successfully and richly with little to no regulation. I deal with regulatory agencies as a matter of business (one of my more valuable job descriptions is regulatory compliance) pretty much every day. I've still not seen compelling evidence of even one regulation that does good and that we'd not be better off without.

Final point: a regulation written to fix a problem created by another regulation is not a regulation with a "good effect". It is hard to find the primary regulatory cause. I blame regulation itself.

Anonymous dh February 27, 2013 2:26 PM  

A joke. It is at best a once a year visit announced well in advance. More often a lot of paperwork that is showed at him or her when they show up.

Okay so it's corrupt. Whats the point then? I never buy the "paperwork" argument. What is it? Chain of custody documentation for the feed? Testing results for viral loads on animals?

I just have a detail orientated position on it. I never go into it thinking an inspector is going to be up to his elbows in the animal.

Anonymous Jake February 27, 2013 2:28 PM  

"we're not interested in carrying your product with a UL or ETL listing"

errr... without... that's "WITH OUT a UL or ETL listing"

Anonymous dh February 27, 2013 2:29 PM  

But I can see it's pretty useless to argue with someone when his basic assumptions are that regulations can do good things. I would never agree with this. Humans are not endowed with the right to regulate, nor the intelligence. I've not seen the effect of regulation be good. It always causes unintended consequences and ultimately, more harm than good.

You have done nothing to make this point, you have just asserted it. I know it's hard to make a case, and I am happy to be persuaded. There are many manifest examples of regulatory systems working well. You are asserting that they are all false, and that in fact, they do no net good.

I have given numerous examples of well done regulatory systems, with good results, that produce a net benefit. I am happy to digg into one if that helps you.


Anonymous Jake February 27, 2013 2:33 PM  

"I have given numerous examples of well done regulatory systems, with good results, that produce a net benefit. I am happy to digg into one if that helps you."

How about 2-3 examples.

OpenID ZT February 27, 2013 2:45 PM  

@DH, I think you are right that zero regulation is harmful to the whole, but as Jack points out private market regulation may offer better more efficient options than government instituted regulation.

Anonymous TheVillageIdiotRet February 27, 2013 2:47 PM  

As long as the Regulators are morally and ethically bankrupt and corrupt.
(Fallen)
Any regulated system is doomed to failure

DannyR

Anonymous Porky February 27, 2013 2:56 PM  

Okay let's just step back for a second. The purpose of regulation is to promote commerce. You can believe that or not, but that's the goal.

Like I said - you don't get it and probably never will. Regulation is just as likely to KILL commerce as promote it. If a regulation DOES happen to promote commerce, you can be damned sure that the beneficiaries are 1) government whores, and 2) The Corporation and lobbyists that left the most cash on the senator's desk.

You're a Pollyanna, dh. A hopeless ignoramus.

Secondly, I would strongly suggest you think for a minute which side of the ideological divide is more interested in promoting locally sourced, locally grown, locally consumed products. It's not the right, and it's not the party of free trade and globalization and far-off production. I happy not tar your opinions with broad brush, but would appreciate the same in return.

Oh brother. It's always about left and right with you morons. Listen, stupid, it doesn't matter whether you are left or right republican of democrat - you give enormous regulatory power and LOTS of money to somebody THEY WILL USE IT! If you are of the opinion that there are actually good and noble lifetime politicians in the US who are guided solely by their good and staid moral compass then you are a complete moron, beyond hope, with absolutely no grip on reality.

I suspect you are one of the people who believe that pages in the Federal register equals new regulations.
And you are wrong, you smug little ass.

I am 100% certain that special interests are stacking the deck against smaller players via regulation. That is the nature of "working the refs" - you want to win, you get the deck stacked in your favor, or at least, not stacked in your competitions favor.

However, the opposite of this is not "no regulation", which is rhetorical device that VD posted. He asked "why regulate at all".


Asking "why" is not advocating "no regulation", moron. Like most libertarians I suspect Vox supports limited government, not "no government". That means he probably supports limited regulation, not "no regulation". This is obviously too nuanced for you as you seem to think the choice is between "a free for all" and "corrupt teams working the refs".

The implicit question, idiot, is "why regulate at all when the refs are obviously bought and paid for"?

Do you understand this? Does it sink in at all? Are you able to grasp any of this?

Nope. And you likely never will.



Anonymous WhoDat February 27, 2013 3:11 PM  

Casino industry is heavily regulated in U.S. and uses the govt to stifle competition.
They don't need the regulation, Indian casinos aren't regulated and do just fine. The regulation is to prevent/minimize competition.

Anonymous Jake February 27, 2013 3:16 PM  

Dh,

Rather than argue against "no regulation" as you imagine it. Why don't you explain why the most corrupt and criminal group of people in the world are the ones you think should be making sure people don't behave in a corrupt/criminal manner.

I'm not saying the fish distributor, or UL, or Walmart, etc. are 100% trust worthy. But they're certainly more trustworthy than the people you advocate should be watching over them.

I've all for "no regulation" but what I mean by that is "no gov. regulation". If you think that means a free-for-all with poison laced food and exploding electronics then you really are living in a fantasy land. In the case of food gov. regulations are actually used to LOWER the standards of food quality not raising them. The requirement that milk be pasteurized for example is mandated so that the dairy business can milk cows without worrying about sanitizing the udders, which might be coated in fresh cow crap, first. The big businesses wanted to do it this way, but didn't want competition from small farmers who would then say "we clean our cows before milking them rather than just pasteurizing to make the fecal matter our competition gets in their milk safe" and they didn't want these small farmers undercutting them on price thanks to not having to lay down a couple mill on the pasteurization equipment. So pasteurization is mandated, the small farmers have to pay for access to the 7-figure equipment and can't compete on price unless they too milk their cows without taking precautions.

Anonymous Porky? February 27, 2013 3:21 PM  

WhoDat: The regulation is to prevent/minimize competition.

Every single time. Does anybody really think that Dianne Feinstein or Harry Reid or any other career politician is just sitting by their phone waiting to hear from a small businessman so that he can help remove some restrictive regulation preventing him from competing? Good Lord - they probably got paid millions to WRITE that regulation in the first place.

Anonymous RedJack February 27, 2013 3:30 PM  

dh

Most of it is chain of custody. To bad that I don't trust a single one of our suppliers to be honest about where the product comes from. Our buyer is to afraid of "Making the supplier mad" to do any further checking.

I can make paperwork say whatever I want to, but a walk to the dock door will make me more confident on the product. Which is what most of our customers do. They send an auditor to come by, often at random, to inspect our plant. Most of them have a paper guy, and a plant guy. The customer audits are more intense, and more in depth, than the USDA/FDA guys ever get.

I had to fish one guy out of a tank once. He wanted to see the inside, and got hung up!

When I go on a plant tour of a supplier (which is rare now), I do the same. Show me the hog line, not the paperwork. The USDA stamp doesn't mean as much as it used to.

Blogger James Dixon February 27, 2013 3:33 PM  

> AA doesn't prove that point. AA went out of business because Enron blew up, and investors lost billion of dollars. IT shows the non-government private market based auditing system is not sufficient to protect investors and the public from bad actors.

It shows that when a company is dependent on trust and loses that trust it ceases to exist. Which is what I was saying. How it loses that trust is immaterial.

Anonymous rycamor February 27, 2013 3:53 PM  

There is a difference between regulation and law, which folks like dh simply don't grasp.

Law should absolutely be used to punish farms and businesses who misrepresent their products. Misrepresentation of a purchased good is a form of theft.

Regulation isn't about that at all. Its purported purpose is to limit your choices, and TELL YOU HOW to do things. And it is a complete joke, because it never even accomplishes its own stated goal in practice. The concept of regulatory oversight is broken by design, the same way that a chain is only as good as its weakest link. Sure there may be some misguided bureaucrats who pursue their regulations in good faith, but whose superior knowledge are they acting on? Scientists? Which scientists? And who carries out their will? Barely literate college graduates? Corrupt assholes on the take? Or even worse, capitalist-haters with an axe to grind?

I can't think of anyone, in any of the many industries I have dealt with, who recalls regulators actually doing what the regulations claim they are supposed to. Right now I have a friend who installs skylights in houses. Suddenly, the county decided this requires a full home inspection, with the silly little plastic box on a post in front of the house containing the documents to be checked. The holy documents. EVERY SINGLE TIME, the inspector just comes, opens the box, checks off his list, and then continues on his merry way. Never once has the actual skylight been inspected.

Anonymous Jack Amok February 27, 2013 3:57 PM  

Okay let's just step back for a second. The purpose of regulation is to promote commerce. You can believe that or not, but that's the goal.

No, that's the claim. You need to stop being so gullible (or else stop expecting us to be so gullible). If you really believe the goal is promoting commerce, please allow me to show you my Dr. Amok's Cure-All Elixir, made from only the finest snake oils. It'll cure whatever ails you...

It's really quite astonishing that someone who demands oversight of private companies making dubious claims because he's worried they might be lying is so effing clueless about how much the public sector lies, cheats, and cuts corners. Well, it ought to be astonishing, but it no longer is because so many people are this damned stupid.

Anonymous Toolbox February 27, 2013 4:04 PM  

@ DH

Finally, specifics. Pick your favorite regulation and tell me how it does all this good that otherwise wouldn't exist in another form.

Anonymous fnn February 27, 2013 4:08 PM  

Regulation must be a complete fantasy if the German govt can't prevent Amazon in Germany from hiring "neo-nazi thugs" as security officers:

Amazon's Deplorable Labor Conditions in Germany


This is a country, after all, that sentences academics to years in prison for "Holocaust Denial." I think the jail time is somewhat shorter for whistling the Horst Wessel Lied or raising your right
arm.

Anonymous E. PERLINE February 27, 2013 4:12 PM  

Who, nowadays, wears out an item of clothing? Some clothing has to have areas worn down at the factory, just to show how sophisticated the owner is.

Shelter is really a disaster. We could build monolithic concrete domes that the Romans invented ages ago, and they resist weather and look good. But they don't conform to local regulations. Instead every house is pieced together by hand out of a mountain of sticks and and they become an ongoing problem in maintenance from the start.


Regarding food, whether it's the highest quality or the lowest quality, it goes into our stomach and gets converted into fuel. And what material do you think does the converting? It's battery acid. I think that carrying around this acid will give us occasional discomfort no matter how carefully our food is inspected beforehand.

Anonymous WhoDat February 27, 2013 4:12 PM  

Dh admits the regulations don't work like they are supposed to. His point is that regulations perform a greater good than if there was no govt oversight.
Lucky for us that 'liberals are in favor of more regulations' to help fix the problem.

Anonymous hardscrabble farmer February 27, 2013 4:21 PM  

Here's another anecdotal story.

Early on in our aquaculture project, not long after I had paid for a pricey license, a state inspector came out to inspect. Nice enough guy, affable as far as bureaucrats go. He was astonished by what we were doing, asked all kinds of questions but basically admitted that he didn't know anything about aquaculture or the processes involved.

After he left I was struck by the fact that I had paid money to be regulated by someone who didn't even understand what we were doing and clearly wasn't going to do anything to change his level of understanding beyond asking me what I was doing. So why was I required to pay for oversight from someone who didn't know anything? If he knew nothing, what type of oversight was he providing? How was he (or his agency) promoting business or protecting the health and welfare of the consumer? What was the purpose of the visit if not to justify his salary and benefits package (as well as the budget of his agency)?

In fact, going back over every State contact we've had since we began farming, with the exception of the Extension guys- who are not regulatory and who do not charge fees for their advise- I haven't encountered one single person yet who grasped farming on even its most fundamental level. The only thing they appear to do is extract revenue from the producer and seek to expand their authority while simultaneously abbrogating responsibility.

Anonymous dh February 27, 2013 4:24 PM  

Finally, specifics. Pick your favorite regulation and tell me how it does all this good that otherwise wouldn't exist in another form.

Gaming (gambling) machines. States with them regulate them heavily, including even source code. Nevada Gaming Commission establishes and enforces the regulations.



Blogger foxmarks February 27, 2013 4:27 PM  

An example of regulation that facilitates commerce: Uniform Commercial Code

Anonymous Jake February 27, 2013 4:34 PM  

"Gaming (gambling) machines. States with them regulate them heavily, including even source code. Nevada Gaming Commission establishes and enforces the regulations."

Now explain how the NGC is an org. that helps the consumer rather than a cartelization device that benefits casinos.

Anonymous Jake February 27, 2013 4:38 PM  

"An example of regulation that facilitates commerce: Uniform Commercial Code"

I disagree. It MAY be an example of making regulation less harmful, but even if the UCC does exactly what is claimed it's not AIDING commerce.

Dh made the same mistake, pointing to "harmonization and removal of regulation" as an example of regulation being beneficial.

It's really good evidence of how regulation is harmful. It seems that this is document represents "regulation of regulations" After all, we can have a free-for-all of regulations.

Mises wept.

Anonymous Porky February 27, 2013 4:38 PM  

Gaming (gambling) machines. States with them regulate them heavily, including even source code. Nevada Gaming Commission establishes and enforces the regulations.

Right. Cuz gambling never could have flourished as a business before the government stepped in.

Moron. Authoritarian moron.

Anonymous Porky February 27, 2013 4:49 PM  

rycamor: Regulation isn't about that at all. Its purported purpose is to limit your choices, and TELL YOU HOW to do things.

Yes. Sunstein is famous for his "nudge" approach to proper training of humans.

We're being trained to behave. Like a bunch of dogs. It's social engineering. They couldn't give a shit about promoting commerce. They just want you to poop where they want, sit when they want, eat what they give you, and don't growl about it or you'll get smacked with a rolled up newspaper.


Anonymous dh February 27, 2013 4:55 PM  

Regulation isn't about that at all. Its purported purpose is to limit your choices, and TELL YOU HOW to do things. And it is a complete joke, because it never even accomplishes its own stated goal in practice. The concept of regulatory oversight is broken by design, the same way that a chain is only as good as its weakest link. Sure there may be some misguided bureaucrats who pursue their regulations in good faith, but whose superior knowledge are they acting on? Scientists? Which scientists? And who carries out their will? Barely literate college graduates? Corrupt assholes on the take? Or even worse, capitalist-haters with an axe to grind?

Yes, I totally get it. A law gives some recourse after the fact. A regulation is designed to constrain the actions in the first place. We get it.

We also get it, you don't like government workers, or regulations.

None of this changes the reality that everyday regulatory systems run effectively all across the country. Are these really nifty high-tech systems like the SEC is supposed to run? No. Do they effectively work? Yes.

Your claim that it's simply broken - always - is false. Surely there are broken regulatory systems. But everyday, it works. I've posted numerous examples. Restaurant inspections in San Diego. Water quality monitoring. Airplane inspection. Long-distance trucking.

Claiming it's all conspiracy is silly. There have been numerous times when liberals have controlled government and did not enact the super secret anti-capitalist regime.

I am happy to consider dismantling the entire structure, or parts it. I don't think it's the end of the world. Very little regulation out there is truly, you know, life-saving. The small parts that are really life-saving do not require a big investment to enforce or maintain (and typically aren't that intrusive either).

But, make no mistake, business will suffer.

Anonymous dh February 27, 2013 4:57 PM  

Now explain how the NGC is an org. that helps the consumer rather than a cartelization device that benefits casinos.

It's not to help consumers - it's to promote business (video gaming).

Right. Cuz gambling never could have flourished as a business before the government stepped in.

Moron. Authoritarian moron.

Electronic gaming (video gambling)? No, no it didn't flourish. It has been popular because gamblers trust it.

Anonymous Jake February 27, 2013 5:01 PM  

"It's not to help consumers - it's to promote business (video gaming)."

Well... if what you're saying is that regulation exists to help certain business to enjoy larger and more predictable profits (at the expense of other business and consumers) then we have no dispute. That's precisely what it's for.

And BTW...isn't online gambling under heavy attack from the regulators you champion?

Anonymous dh February 27, 2013 5:03 PM  

It's really good evidence of how regulation is harmful. It seems that this is document represents "regulation of regulations" After all, we can have a free-for-all of regulations.

No no and double no.

Any given regulation on it's own has very little cost and exists without negative consequences.

ALL CHECKS HAVE THE SIGNATURE LINE ON THE BOTTOM.

That costs nothing. The check must have a signature by definition. Specifying where it goes costs nothing to a business.

Now, having 50 unique versions of that requirement, where 23 are "SIGNATURE LINE MUST BE ON THE TOP", 25 are "SIGNATURE LINE MUST BE ON THE BOTTOM", and the rest are "SIGNATURE LINE MUST BE LEFT TO RIGHT, AT A 45-DEGREE ANGLE" causes a problem because the state or local versions overlap and are contradictory.

And that's where harmonization provides a net benefit. This is the standardization method of regulation. It's been around a long time. It facilitates a massive amount of business.

Anonymous Porky February 27, 2013 5:03 PM  

An example of regulation that facilitates commerce: Uniform Commercial Code

Those are laws, not regulations.

Blogger foxmarks February 27, 2013 5:04 PM  

Jake:

Many provisions that the UCC harmonized (like warranty terms) were a codification of rules that arose from the Common Law. The free-ish market developed those rules over centuries of trial and error. The UCC just says that everyone must play by them, uniformly.

Privately-developed regulations tended to become law (or coercive regulation, if you must) because they worked so well. The merchants and the public wanted the reliability that rules provide.

There’s probably a useful distinction to be made between codification of ancient organic rules and gratuitous writing of code to shape commerce and society.

If I leave out a few steps of my thinking, I end up at another version of “women ruin everything”. Increasing use of law to lead society instead of having law follow society’s established patterns seems coincident with Progressivism/Marxism/Feminism.

Blogger foxmarks February 27, 2013 5:06 PM  

Those are laws, not regulations.

There’s a rule against moving the goalposts.

Anonymous dh February 27, 2013 5:09 PM  

Well... if what you're saying is that regulation exists to help certain business to enjoy larger and more predictable profits (at the expense of other business and consumers) then we have no dispute. That's precisely what it's for.

There is no nothing discriminatory about video gambling regulation. It creates trust with gamblers and that allows them to gamble with confidence that they aren't being screwed outside the parameters that they agree to. It facilitates a transaction that is transparent. Gambler pays $X for a Y% chance to win $Z dollars.

And BTW...isn't online gambling under heavy attack from the regulators you champion?
No, it's being rapidly expanded. 10 more states have some legal form of it in the last 24 months. NJ and NV are expanding the permissible borders of electronic (now online) gaming. The Federal government issued guidance last year that upheld a more fringe-y interpretation of funds wire laws that broadens what can be paid for with US funds from US banks.

Anonymous Jake February 27, 2013 5:11 PM  

"And that's where harmonization provides a net benefit. This is the standardization method of regulation. It's been around a long time. It facilitates a massive amount of business."

Standardization that helps business does not need government decree. There's no government regulation about how a USB device works, it's a standard developed by the market and enforced by the market. Same thing could be said for literally millions of standards. "right tighty lefty loosey" for example.

What YOUR were pointing to was "state A regulates that X must be true" "state B regulates that X must be false" so "UCC regulates that X must be either true or false everywhere"... that's not a helpful regulation, it's lessening the burden of existing regulation.

Anonymous dh February 27, 2013 5:18 PM  

Standardization that helps business does not need government decree. There's no government regulation about how a USB device works, it's a standard developed by the market and enforced by the market. Same thing could be said for literally millions of standards. "right tighty lefty loosey" for example.

This is true sometimes. But not always. The consumer is often harmed. See HD DVD and Blueray.

that's not a helpful regulation, it's lessening the burden of existing regulation.

It is a net helpful regulation. Because business can be conducted far more easily with the 1 standard.

These are the real bottom line basics that make a lot business happens. "Check 21" initiative in the 1990's did what banks had failed to do for 10 years - standardize electronic check processing.

In general though, I think you have a great point that these are not necessarily a government function. In some cases (like the UL listed before), they are essentially a state granted monopoly. I prefer actual state-based regulation to government granted monopoly status, but that's a personal preference based on ideology. But in the end, it's the same enforcement method - government authority not voluntary compliance.

Anonymous hardscrabble farmer February 27, 2013 5:21 PM  

Funny.

This thread is becoming its very own satirical form of a regulatory agency. Endless digressions about minutae by people who admitedly don't know which end of an animal to feed but who insist upon the right to tell you how to feed your own (and pay for the privilege to boot).

Hat tip to you dh, if you aren't having a piss at our expense you are the proverbial example of the bureaucrat gone mad with power.

And now, after a relaxing afternoon of back and forth while the snow piled up, I am off to attend to the livestock, sans FDA approval.

And thank you VD for having one of the most enjoyable blogs on the Internets.

Anonymous Jake February 27, 2013 5:23 PM  

"10 more states have some legal form of it in the last 24 months. NJ and NV are expanding the permissible borders of electronic (now online) gaming. "

So it was illegal (i.e. regulated into non-existence) and now it's being made legal under some conditions and this is your example of regulation helping? You really are quite the statist... "how noble of the government to permit people to do this now where they'd previously prohibited it and define the permissible borders." Please, I guarantee if we were deep in the gaming industry and understood the laws and how the money worked and how the regulations worked it would be easy to see how these regs. work to benefit a few key players and the expense of everyone else.

Anonymous Porky February 27, 2013 5:23 PM  

Electronic gaming (video gambling)? No, no it didn't flourish. It has been popular because gamblers trust it.

Like I've been saying, you are an ignoramus and you will likely never be able to understand this.

Online poker was a multibillion dollar industry BEFORE the govt. stepped in to regulate it. Why did the govt. step in to regulate it? Because Because they were all offshore operations and they wanted a piece of the action. Period.

It has NOTHING to do with promoting commerce or consumer confidence. It has everything to do with greedy, powerful Washington bureaucrats.

Anonymous Porky February 27, 2013 5:32 PM  

There’s a rule against moving the goalposts.

Do you really not understand the difference between a law that must be passed by representatives and a regulation which can be enacted by one evil authoritarian jerk with a ball point pen?

Anonymous dh February 27, 2013 5:35 PM  

Porky--

You are talking about 2 different things.

1. Online poker - which has everything to do with CONGRESS, and nothing to do with bureaucratic regulators.

2. Video gambling - slots/etc - which was an underground enterprise, and not popular, until it gained a strong foothold in casinos and video betting parlors.

I know your ideology is upsetting you, but deal with facts.

Anonymous dh February 27, 2013 5:41 PM  

This thread is becoming its very own satirical form of a regulatory agency. Endless digressions about minutae by people who admitedly don't know which end of an animal to feed but who insist upon the right to tell you how to feed your own (and pay for the privilege to boot).

I strongly suspect you can't find where I said anything close to what you attribute to me. Go re-read the very first thing I posted, and tell me what you disagree with. Do you wish to be able to sell your horse meat as cow? Do you wish to be able to deceive your packer with impunity?

That's easy. Now tell me about your antibiotic use. Buying meat at the market - do I have right to know if it has antibiotics in it? Artificial hormones? Horse meat mixed? Excrement mixed in?

That's what we are talking about. Your (and mine, actually) competition says it's not for me to know. And it just so happens that they'll do all those things to make more money. And when we can't compete, too bad.

I disagree strongly with premises that there are only "bad" or harmful regulations. Regulations which increase market transparency are inherently pro-business, and often pro-small business, because it increases the opportunity for consumers to make an informed purchasing decision. These are regulations which do restrict your ability to do anything you want with your animals, but increase the ability for all of us to know what's in it.

These are many other circumstances just like this. Transparent markets are the engine of the free enterprise system.

Anonymous Jake February 27, 2013 5:42 PM  

I was talking about online poker. Which is being suppressed by the government because the casinos would rather not have to compete against it.

I suspect if you got right down to it a lot of the examples you're pointing to as "regulators creating standards" are more "regulators allowing what had previously been prevented". You almost seem to grasp this talking about video gambling being allowed in 24 states and it's permissible boarders being expanded. This isn't regulators creating something new, it's something new slowly overcoming the regulators. I'm sure it's still heavily regulated, but that's hardly proof it could only exist heavily regulated.

Anonymous Jake February 27, 2013 5:47 PM  

Do note that your examples come from the gambling and banking industry. Two of the most heavily regulated and cartelized (or do I repeat myself) industries in the country. Should it really be a surprise in industries where nothing is allowed to happen without regulatory say so that nothing new would happen until regulations deem to allow it?

As for blu-ray and HD-DVD... big deal, everyone knew that there were two competing standards and only one would win-out those who bought HD-DVD did so at their own risk. And it's not like they blew up and killed people, the HD-DVD players were safe more or less functional, which is what regulations are supposedly there to ensure. Do you think we'd be better off if the gov. designed our media? Or if they picked one based on who bribed the right people and THAT became the standard?

Anonymous Porky February 27, 2013 6:13 PM  

1. Online poker - which has everything to do with CONGRESS, and nothing to do with bureaucratic regulators.

Tell that to Barney Frank.


2. Video gambling - slots/etc - which was an underground enterprise, and not popular, until it gained a strong foothold in casinos and video betting parlors.

I know your ideology is upsetting you, but deal with facts.

Facts? The Nevada Gaming Commission was formed in 1959. Entrepreneur Si Redd didn't invent video gambling until the mid 70's with backing from Bally's and it was immediately a hit in neighborhood casinos.

You are talking out of your ass, buddy.

Anonymous hardscrabble farmer February 27, 2013 6:17 PM  

I wrote-

"This thread is becoming its very own satirical form of a regulatory agency. Endless digressions about minutae by people who admitedly don't know which end of an animal to feed but who insist upon the right to tell you how to feed your own (and pay for the privilege to boot)."

You responded-

"I strongly suspect you can't find where I said anything close to what you attribute to me."

I offer this bon mot from your very own fingertips-

"I JUST OWN IT. Don't tip your hat. I just handle some of the business. Luckily I have family who knows what they are doing!! I am lucky if I can find the right side to feed!"

And that was after telling me about your 220acre farm that you run produce and livestock on.

And after everything I have written you have the nerve to ask-

"Do you wish to be able to sell your horse meat as cow? Do you wish to be able to deceive your packer with impunity?"

You are disingeuous and are the very type everyone in this thread has been talking about when they run down regulation.

In your twisted world honest people are deceptive and need regulating and ignorant lying regulators can be trusted and need more power. It's a veritable hamster cage you've got inside that skull of yours spewing endless reams of gobbledeegook trussed up in fatuous pontificating, masquerading as rational thought, but I am being too kind.

*washes hands of intellectual manure*

P.S.

New bull calf this afternoon, doing quite well and standing in the snow next to mother. Send an inspector pronto to tell me what to do.

Blogger Cogitans Iuvenis February 27, 2013 6:37 PM  

In the capitalist fictional world of little or no regulation, air travel is basically a game of trust - do you trust the carrier, do you trust the manufacturer, do you trust the mechanics and the airport, et all.

Really? That is the example you use? Ignoring the fact that even with regulation travel is still a game of trust why exactly would the airplane manufacturer, the airline, or the mechanic not give two shits if the plane crashed? Oh, that's because they are orcs and not human beings that revel in suffering and death!

I know, how about establish a regulatory agency that monitors parents, since without regulation children will have to trust that their parents won't fuck their little asses...fucking stupid.

Blogger Cogitans Iuvenis February 27, 2013 6:39 PM  



I recently got food poisoning from an establishment that had just past our cities sanitary inspection So yeah, useless.

Blogger foxmarks February 27, 2013 6:42 PM  

the difference between a law that must be passed by representatives and a regulation which can be enacted by one evil authoritarian jerk

So if the regs are packaged into an omnibus bill that passes, you’re fine with them?

I say your distinction is irrelevant in this context. There have been a bunch of broad statements about “all regulation” being bad. I point out a subset that counters that notion, and you point at a different subset.

That we empower petty tyrant bureaucrats is a different problem than challenging the effectiveness or validity of gov’t regulation itself.

Anonymous Porky February 27, 2013 6:49 PM  

In your twisted world honest people are deceptive and need regulating and ignorant lying regulators can be trusted and need more power.

Well said, hardscrabble. That's pretty much it.

The truth is that all men having power ought to be mistrusted.
James Madison



Anonymous realmatt February 27, 2013 9:13 PM  

The truth is that all men having power ought to be mistrusted.
James Madison


All people everywhere of every rank...

Anonymous Sheila February 27, 2013 9:30 PM  

I peruse this entire 200 post thread and nowhere does anyone mention that the vast majority of mislabeled fish is sold in restaurants - specifically, SUSHI restaurants. This doesn't begin to touch on compliance and/or the necessity of government regulations (love your posts, Hardscrabble Farmer), but it does touch on DWLs and their habits. Those pitiful examples of hogs that HF saw were destined for Whole Foods. The young and hipsters eat their "natural" raw fish (full disclosure: I used to eat and greatly enjoy sushi when it was a "new" thing many years ago) which we now find is highly unlikely to be anything close to what it claims to be. Is this a byproduct of regulation or lack thereof? . . . or are our Sushi chefs just a lot dumber than the Japanese ones? . . . or are our "inspectors" a joke in comparison to Japanese ones?

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