Faith In An Unregulated Free Market

Big, unrestricted business, on the other hand, is controlled by primarily the producers (Rand, “What is Capitalism?”) and secondarily the consumers, who keep in business the products they want or need. Ayn Rand heavily maintained that unregulated business protects the choices of the individual by treating him as a self-governed, self-owned, altogether “independent” (Rand, “What is Capitalism?”) person; it encourages healthy selfishness by letting each person look to their own interests and needs, rather than having to “subordinate” their desires to an “industry as a whole” (Rand, Atlas Shrugged 75).

However, current president, Donald Trump, has urged a push back to the laissez-faire economic philosophy of Adam Smith. In a meeting with multiple executives of large American companies, President Trump explained, “cuts to both corporate taxes and regulations — promises he made for the duration of his campaign — were on the horizon” (Lam, 2017). The differing economic philosophies presented in the stimulus material and the new president’s ideas for the future of the american economy, led me to ask the research question, “Should the United States federal government increase economic regulation?” By first examining a historical lens on the effects of economic regulation, then a scientific lens on the effects regulation has on innovation in science, and finally, an economic lens to look at the overall effects of President Trump’s plans to decrease government regulation, it will be clear the United States federal government should not increase economic

Market Critic: The United States’ government should be considerate of any action they make since it ends up affecting practices in the entire business world.

The America economy is being over-regulated by excessive and poorly written regulation. Some of the rules have been ridiculous. For instance, the Federal Railroad Administration requires that all trains be painted with letter ‘F’ at the front to make it easy to identify which end is which. Another instance is where the Bureaucratic busybodies have closed the children lemonade stands since the enterprising young moppets lacked training license. The list is endless. Unlike in other Europeans nation where the meddling government has circumscribed the lives of citizens, American is free to choose what they want for better for worse. The country is meant to be the home of Laisses-faire, and the government is not supposed to interfere with people activities ("Over-regulated America"). However, America has been straying for some time from this ideal.

In other words, I don’t believe that the free market is entirely self-regulating and has some serious flaws when it comes to looking out for the public’s interests. Perhaps one of the most egregious and recent examples of the free market failing to regulate itself was during the 2008 financial crisis and the years leading up to it. Economists and government agencies have attributed many causes for the 2008 financial crisis, but according to United States (2010), “widespread failures in financial regulation and supervision” and “dramatic failures of corporate governance and risk management” where major causes for the crisis (p. xviii). These failures went on to cause a recession which resulted in a major spike in unemployment, wide-spread evictions, and hundreds of thousands of home foreclosures (Schoen, 2010). This was a prime example of how leaving certain aspects of our free-market economy unchecked and un-regulated can lead to economic catastrophe and severely cripple millions of people financially. In times of crisis like 2008, it is absolutely necessary that the government intervene to provide relief and

"Lawmakers and regulators construct complex cost benefit calculations to justify the rules, but they never account for the erosion of liberty inherent in each and every one" said Diane (Katz, 1). Seventy four percent of voters in the United States believe that businesses and consumers are over regulated (Thompson and Tringali, 2). "Also, majorities agree that the increasing number of regulations have created uncertainty for large and small businesses (66%), and that agencies who enforce regulations fail to consider that their decisions lead to increased prices for consumers and job losses (69%)," according to a poll (Thompson and Tringali, 2). Ironically, Barak Obama has been trying to convince and persuade voters that he does actually care about jobs (Barone, 1).

The U.S. economy has somewhat recovered from the recession that began in 2008, but from my recent findings I have realized that there has been an unbalance in that recovery. Investments have fallen and businesses investments have been weak. The government regulates securities markets, the environment, and even serves as a safety-net for businesses that are at risk for bankruptcy. In many efforts to mend the economy, regulations are costing the United States trillions of dollars. These regulations are costly, but may be necessary if it produces an even larger economic and social benefit. Regulations have many different functions like, restricting harmful products, regulating the use

Under public interest theory, regulations exist to protect consumers, to protect workers, and to protect the rights of the least advantaged. They exist to hedge against the greed, corruption, and exploitation that can occur in an unchecked capitalistic society. They attempt to prevent or ameliorate detrimental consequences to individuals and communities. Granted, this can be seen as an idealistic view of regulation. Exponents of public interest theory argue that even well-intentioned regulation can fail to achieve what it set out to do, and politicians are imperfect and subject to pressure both by corporations and vocal minorities (Koopman et al., 2014). Nonetheless, in the United States, these democratically elected local and federal representatives have put regulations in place that, unless given reason for doubt, are presumed to reflect the will of their constituents. Therefore, rebelling against regulation is not simply renouncing the government – in some cases, it is renouncing the concerns of the communities that these companies argue they are improving.

This paper will discuss the proposed views on the advantages and disadvantages of government regulations on businesses.

Government intervention could be viewed as an essential element to regulate the economy, but over the past decades, we have seen that it is not the case. Adam Smith a classical liberal proposed the idea of Laissez Faire, which

Think about the US government. When people usually surmise about the US government, a few general words come about. Some of the words people will say are: corruption, politics, and economics. Economics or money is usually the first that comes to people’s mind. Why ? Because it’s all around about us, and it’s a heavily debatable topic. The US government was given the right to control money in different areas of the public economy. Some of those areas being in foreign commerce, tax regulations, and social security. However these amendments have made the US adopt the theory of laissez faire. The United States needs to extend more economic regulation.

Even though freedom for the private sector is a virtue, there should be government regulation in place due to corporate official’s inability to satiate their hunger for personal wealth endangering the global economy and the event in 2008 which was the global economic crisis occurring which could have been prevented or at least lessened.

Friedman argued however, that this intervention was destabilising, and that what was needed was a steady money flow to create a basic framework for the economy; the rest should be left up to individual competition. This school of thought goes along the lines of 'It is in the best interest of the producer to satisfy the consumers' wishes. By doing this, they are also acting in their own interest, therefore competition is working to the benefit of the whole economy.' In order for this competition to be present, there needs to be freedom of the individual. He boldly stated that this can only be created by minimal government regulation of the economy, which allows power to be concentrated and wielded by only a few individuals, rather than dispersed. After all, competition can only be present between companies that are on equal grounds in relation to the amount of power behind each.

People’s lives are increasingly controlled and shaped no longer by governments but also by corporations. For example, the liberalization and deregulation have given more influence, liberty and choices to private actors.

State intervention at private markets generates costs, unpredictable consequences and is often more damaging than purposeful. The state frequently builds obstacles preventing economic growth. In many cases state regulations raise company functioning costs, slow down decision-making processes and limit access to resources necessary for the production of goods and the provision of services. Finally, it is the consumer who suffers unfavorable effects of such regulations. One of the negative side-effects, in terms of the state interference in the social sphere, are administration costs covered by the state budget and spent on running and supporting federal agencies. Another negative factor takes the form of bureaucratic inclinations presented by clerks in creating regulations the objective of which is often lost among inadequate requirements, the maze of rules difficult to overcome for consumers and entrepreneurs in order to meet due requirements. Additionally, entrepreneurs themselves are trying to extend the scope of regulations by seeking ways to use them to their own advantage. The costs to be covered by entrepreneurs refer to the necessary documentation, accounting and legal advice, employing consultants and experts, the purchase of necessary equipment, but also the cost of waiting time for indispensable