{"id":36090,"date":"2018-06-30T01:00:25","date_gmt":"2018-06-30T05:00:25","guid":{"rendered":"http:\/\/quotulatiousness.ca\/blog\/?p=36090"},"modified":"2018-06-10T12:12:33","modified_gmt":"2018-06-10T16:12:33","slug":"qotd-in-government-regulations-complexity-is-a-subsidy-to-existing-companies","status":"publish","type":"post","link":"https:\/\/quotulatiousness.ca\/blog\/2018\/06\/30\/qotd-in-government-regulations-complexity-is-a-subsidy-to-existing-companies\/","title":{"rendered":"QotD: In government regulations, complexity is a subsidy to existing companies"},"content":{"rendered":"<blockquote><p>One of the major themes of the book I\u2019m working on should be familiar to longtime readers of this \u201cnews\u201dletter. It boils down to a simple insight: Complexity is a subsidy. The more complex you make the rules, the more you reward people with the cognitive, material, or social resources necessary to get around them. Big corporations tend not to object to more burdensome regulations because they can afford to comply with them. Dodd-Frank was great for the \u201ctoo big to fail\u201d crowd. But it has been <a href=\"https:\/\/chicagoagentmagazine.com\/2015\/10\/05\/community-banks-dying-or-dead\/\" target=\"_blank\">murder on community banks<\/a> that don\u2019t have the resources to comply. As Lloyd Blankfein, the CEO of Goldman Sachs, put it: <\/p>\n<ul>\n<p><em>It\u2019s very hard for outside entrants to come in and disrupt our business simply because we\u2019re so regulated. We hear people in our industry talk about the regulation, and they talk about it with a sigh about the burdensome of regulation. But in fact in some cases the burdensome regulation acts as a bit of a moat around our business. <\/em><\/p>\n<\/ul>\n<p>But you\u2019ve been hearing this stuff from me for years. Let\u2019s get back to the arrogance thing. It seems to me a big part of the problem with progressive elites these days is that they lack self-awareness. That elites arrange affairs for their own self-interest is an insight that was already ancient when Robert Michels penned his Iron Law of Oligarchy. But ever since the progressives concocted their theories of \u201c<a href=\"http:\/\/www.encyclopedia.com\/arts\/culture-magazines\/preface-morals\" target=\"_blank\">disinterestedness<\/a>,\u201d they\u2019ve convinced themselves that they are not in fact a self-serving elite. Give feudal aristocrats their due: They were a self-dealing crop of rent-seekers and exploiters, but at least they were open about the fact that they believed they had a divine right to sit atop the social pyramid. Today\u2019s progressive aristocracy is largely blind to the fact that their cult of expertise isn\u2019t really about expertise; it\u2019s about organizing society in a way that reinforces their status and power.<\/p>\n<p>Well, most of them are blind to it. Occasionally the mask slips. <a href=\"http:\/\/www.nationalreview.com\/article\/392672\/thank-you-jonathan-gruber-rich-lowry\" target=\"_blank\">Jonathan Gruber<\/a>, one of the chief architects and financial beneficiaries of the health-care \u201creform,\u201d told audiences that Obamacare was designed \u201cin a tortured way\u201d to hide the fact that \u201chealthy people pay in and sick people get money.\u201d They had to do it this way to get around the inconvenient \u201cstupidity of the American voter.\u201d A feudal lord who talked this way about his serfs wouldn\u2019t get any grief for it. But in America such honesty gets you rendered an un-person.<\/p>\n<p>Jonah Goldberg, <a href=\"http:\/\/www.nationalreview.com\/g-file\/440850\/obamacare-failed-promises\" target=\"_blank\">&#8220;The Consequences of Overpromising on Obamacare&#8221;, <em>National Review<\/em><\/a>, 2016-10-08.<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"<p>One of the major themes of the book I\u2019m working on should be familiar to longtime readers of this \u201cnews\u201dletter. It boils down to a simple insight: Complexity is a subsidy. The more complex you make the rules, the more you reward people with the cognitive, material, or social resources necessary to get around them. [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":35193,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8,831,84],"tags":[645,727,1020,661,848,793],"class_list":["post-36090","post","type-post","status-publish","format-standard","hentry","category-bureaucracy","category-business","category-government","tag-corporatewelfare","tag-cronycapitalism","tag-progressives","tag-regulation","tag-rentseeking","tag-subsidies"],"jetpack_featured_media_url":"https:\/\/quotulatiousness.ca\/blog\/wp-content\/uploads\/2016\/06\/favicon.png","jetpack_shortlink":"https:\/\/wp.me\/p2hpV6-9o6","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts\/36090","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/comments?post=36090"}],"version-history":[{"count":1,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts\/36090\/revisions"}],"predecessor-version":[{"id":36091,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/posts\/36090\/revisions\/36091"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/media\/35193"}],"wp:attachment":[{"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/media?parent=36090"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/categories?post=36090"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/quotulatiousness.ca\/blog\/wp-json\/wp\/v2\/tags?post=36090"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}