Government is Best Which Governs Least... Or is it?

Welcome to Day 4 of TA's Blog! I must say I've been very encouraged by the response here so far, and the nice comments many people have made. I figured Blogging was going to be somewhat like being in radio... you never know if anyone is actually on the other end listening. However, it's clear that many are listening, so thanks and we'll try to keep it up on this end.

That being said, I want to encourage free debate and exchange of ideas here... what I do NOT want is for this Blog to turn into a giant echo chamber (like Ellen's Blog), where it is only like minded zealots talking to each other, saying only what they want to hear. I could simply lurk on Ellen's Blog if I wanted that. It reminds me of a funny story that illustrates the liberal bias in mainstream media as far back as Nixon's run for the White House. When Nixon won in a landslide (after an entire election cycle of taking a hammering in the media), a well known newspaper editor (forget if he was from the NY Times or the Washington Post) was heard to have expressed his amazement at the win, saying, "I can't believe Nixon won- not a single person I know voted for him!" Kidding aside, a comment like that makes it clear to me the danger of only hanging out with like-minded people and never considering another view. It should be obvious that neither political party in the U.S. has all the answers (or even most of the answers), so we need to continually challenge and question our elected representatives.

So, let's get to it. Today's post questions the involvement our government should have in regulating businesses, not for health and safety reasons (which I think everyone agrees we need), but simply for the sake of promoting or protecting certain businesses over others "for the good of society."

I was at a professional event last night in the City, and was seated with a gentleman at dinner who started railing about Wal-Mart, big box stores in general, outsourcing of professional jobs of all kinds to India, manufacturing to China, etc., etc. His view was that the government needed to step in to "protect" America and American jobs. How this would be accomplished, he didn't know (shocker), but I suggested perhaps we needed to return to the 1800s, with high tariffs and protectionism to keep out foreign goods. Of course, this would have the effect of dramatically increasing the prices of goods, which would not be a popular result. This individual lamented the fact that the government did not step in and regulate the business practices of companies like Wal-Mart that are very good at dominating market share and beating up their vendors to give them the very lowest prices, because this can have the effect of not only sometimes putting local mom and pop businesses out of existence, but even some entire companies that can no longer competitively sell their goods to companies like Wal-Mart that have the ability to buy from China or wherever.

As we went around and around, the consensus around the table became that while it would be great to have no competition from foreign workers and companies on one hand (many people would theoretically have higher-paying jobs and more money to spend), we would pay for it by having to pay for it, i.e., the money for higher-paying jobs and goods has got to come from somewhere, and it would be out of our pockets. No more cheap goods at Wal-Mart. To me, people like this seem to fail to understand that there is no free lunch--you can't simply decide to raise a standard of living with no ancillary effects on the rest of the economy. Guys like Representative Dingell, though, may actually understand this point--his theory with his global warming bill is that no one will accept it, because it costs too much and we as Americans are unwilling to make the sacrifice. If I don't think that Wal-Mart or Target or whatever store is good for the economy, or I don't like their labor policies, or whatever, I am free to shop elsewhere. But, should the government force this decision on me if the bureaucrats somewhere decide that THEY don't like it either, and want to force the American people to pay more to accept higher prices??? Lest it shock anyone, this has in fact been the policy of the American government over several periods in our history, and even continues today in some aspects of the economy.

So, being a laisse-faire capitalist myself, the question of the day is, to what extent can or should government get involved in trying to "protect" certain businesses (excluding businesses that might need to be protected for security interest reasons or similar national interests) from private competition? Let's try to stay away from Wal-Mart bashing or other exercises and focus on the duty of government to regulate, not for the safety and welfare of society, but merely for the sake of promoting certain private business interests over others.