The Formula for Economic Freedom

I spoke at the 7/28/15 Board of Supervisors hearing regarding Lynn Morgan’s urgency ordinance to ban formula businesses in District 3, an action prompted by the soon to be Dollar General store in Buckhorn. My remarks follow:

“I am absolutely opposed to this proposed ordinance. While there is much I could say, I will limit myself to two issues. First, this proposal makes everything more complex, adding to what I consider a disturbing trend pervasive throughout our society in big and small ways. Often in the name of an improvement, real or just imagined, more rules are made. In the end this added complexity creates more problems than it solves.  Once upon a time, we Americans achieved economic greatness by simplifying machinery. 

Formula stores include franchises. These opportunities allow ordinary people to start a business without having to start from scratch or reinvent the wheel. There are almost 3,000 franchises available with a dozen or so around $10,000 or less.  These include cleaning services, glass repair, travel agencies and exercise studios.  Given this situation some people will request that the ordinance include exemptions and appeal procedures.  Aside from the additional expense, this creates another huddle for a beginning business by someone who still probably has their day job. It could cancel someone’s dream. To add to their difficulty and to inhibit the country’s economic health for someone’s subjective aesthetics and personal preferences doesn’t seem like a fair deal to me.”

Her proposal was defeated on a 4 to 1 vote, but many people spoke in favor of the ordinance. They all wanted to pick and choose through new regulations what businesses can locate upcountry. While I understand their sentiment of not wanting homogenous structures that look the same as everywhere else, their willingness to trade away economic freedom for cutesy buildings seems unbalanced and naïve. Don’t they understand that it’s their own economic freedom that they are destroying? Aren’t they shooting themselves in the foot with perhaps a few year time delay before realization?

When one looks around the world, they discover that a country’s amount of poverty is directly proportional to the amount of economic regulation it has. “It takes 2 days to start a business in Australia, but 203 days in Haiti and 215 days in the Democratic Republic of Congo.” Additionally, the more rules there are the greater the incentive there is to avoid them and consequently the greater amount of regulation the greater the amount of corruption. These fine examples illustrate how we can regulate ourselves into unfairness and poverty. But here in Amador County, it’s slow, incremental steps so that it may be too late when we experience their cumulative impact and wonder how this happened.

There were valid claims, at the hearing, about the traffic flow on Meadow Vista Drive. But that is a factor for the existing building permit process. If that somehow doesn’t work than that process needs changing, not the creation of a new layer of regulation however temporary it’s proposed to be at first.

Copyright 2015, Mark L. Bennett

More Musings & Observations

One advantage of aging is a longer perspective.  Food companies have been under pressure for decades to reduce the preservatives in their products. One doesn’t have to take a logic class to figure out that anything that prevents food from decaying would also make it hard to decay (digest) in your gut. Those on the left charge that corporate greed demands a long shelf life. The food producers have argued that consumers asked for longer shelf lives. The purer food people denounced that as pure bunk. But one of those requesting consumers was my mother. She was a liberal sticking it to big corporations to sell what she considered a better, longer lasting product.

Some years ago, Greece was too much of a fiscal mess to join the EU so they hired Goldman Sachs to cook their books for a multi million fee. After they did that they then shorted Greek debt and made another bundle. Today Greece is collapsing. I'm sure Hillary Clinton must feel horridly guilty every time she takes another donation check from Goldman Sachs. 

But no matter what happens its always business as usual in Washington. The Department of Agriculture recently received $17 million to inspect catfish despite the Food and Drug Administration already spending $7 million inspecting catfish. Please remember that although outside lobbyists play a major role in closed door Washington, the right of government agencies to lobby for themselves was part of FDR’s new deal for America. Now the two agencies have agreed to work jointly and to, over time, separate their respective seafood turfs. So there’s no need to worry that anyone will lose their cushy job or pension on our dime. It’s easy to understand that those in power want to maintain regulatory pressure on the population of catfish raising rural southern areas similar to what Obama did when reducing the number of auto dealerships during the car companies’ brief nationalization. “Coincidently” many big Republican donors lost their dealerships then. But catfish and similar type fish enter the USA from Southeast Asia with hardly any inspection. If this gives you shivers about the Trans-Pacific Partnership you are probably not alone.

Much of this product has been banned in Russia because it contains E. coli and listeria. But why worry? Certainly California will require a vaccination against those germs soon. And if you can’t wait, you can always become someone you are not. Two billion dollars of the world’s economy are Botox sales. But if the morality of extreme vanity bothers you, again why worry? The government is always there to lend a helping hand. When first quarter gross domestic product figures came in lower than expected the San Francisco Fed suggested changing the seasonal adjustment factors to create a higher number so we could all feel better.

D. Norman recently posted a discussion about entitlements here where in he calls for “complete and factual information.” Then this must include things he didn’t mention such as illegal immigrants who may have never worked a day in this county receiving benefits and the huge benefit provider industry. This includes J.P. Morgan EFS, Affiliated Computer Services, and eFunds. Since 2004 JPMorgan has been paid almost $6 million. The more they enroll the more they make. So there’s an incentive to get people on the dole.  As with too many government programs it’s not the cost of the benefit but the cost of and style of administration. Nobody in America wants to eat diseased fish or let the poor to starve.

Copyright 2015, Mark L. Bennett