Business Regulations -- What Would Be The Perfect World For You?

[TZK203]

Let's assume you had the ability to write in any regulation or business measure into law, whether it's adding a worker protection or just regulating a business practice. Regardless of what you choose, what would you sign into law that would make workers happier/more productive/*insert something positive here* and/or would restrict or limit a certain business practice?

If you have your own take on this that doesn't fit the memo posted above, still feel free to share. I'm just curious.

[Elegiac]

Banning commercial banks from lending out money for investment purposes would be one.

[THE Bigzoman]

Let's assume you had the ability to write in any regulation or business measure into law, whether it's adding a worker protection or just regulating a business practice. Regardless of what you choose, what would you sign into law that would make workers happier/more productive/*insert something positive here* and/or would restrict or limit a certain business practice?

If you have your own take on this that doesn't fit the memo posted above, still feel free to share. I'm just curious.

I would get rid of ones I think are dumb and just make entry into labor/output markets harder.

For example, why in the world do you need to go to school and get an arbitrary piece of paper in order to legally work as a barber/hairdresser.

This isn't touching the cleaning requirements that barbershops must uphold. It eliminates the requirement to be a "certified" barber. Consumers will go to someone who cuts their hair up to par. If they do a bad job, chances are they won't go back to that barber. It's just that simple.

[PosPosPos]

I would write a law that abolishes all existing business regulations and laws.

People won't know they had it good until they lose it to begin with.

[Hammerfest]

Let's assume you had the ability to write in any regulation or business measure into law, whether it's adding a worker protection or just regulating a business practice. Regardless of what you choose, what would you sign into law that would make workers happier/more productive/*insert something positive here* and/or would restrict or limit a certain business practice?

If you have your own take on this that doesn't fit the memo posted above, still feel free to share. I'm just curious.

I would repeal these laws rather than make new ones.

[Elegiac]

I would repeal these laws rather than make new ones.

Which has never been a recipe for economic bliss ever.

[apepi]

Glass-Steagall would be a start.

Or maybe a law where companies can not donate to politicians or something like that.

[crazymack]

Who's interest has the most value?

[TZK203]

Who's interest has the most value?

I always feel like the workers' interests have more value.

But eh, that's really up to you.

[Grummgug]

There is no perfect world. Good business regulation law is always in flux. To get a feel for what is good law, you first need to understand the industry. Then you need to look at regulations around the world and see how to lower yours relative to others.

Its like asking "what is the perfect tax rate?" The answer is it depends on what tax rates are around the world. If its 1977, a 39% tax rate might be the lowest in the world, and you would boost economic activity significantly. If its 2014, a 39% tax rate might be the highest in the industrialized world, and you will damage your economy with it.

[Trimshadow]

I would make it illegal for Companies or Corporations to Donate to Political Campaign funds (it's actually buying favours and 1/2 the reason the System is fooked)
I would set a limit to personal wealth creation - excess goes to the state..
I would set a limit to Compainy / Corporate Profiteering - excess goes to the state..
I would pass a law stating that any company lobbying the government for a bail out, the government then 'OWNS' X% of said company based on company value and the amount of the bail-out.
And I would prosecute all of the high-level execs who allowed their companies to take part in the sub-prime fiasco that practically brought the planet to it's knees...

[Tierbook]

I would use it to make myself as obscenely wealthy as possible.

[user531345]

Id say the business regulations we had 1933-1979, those were pretty good, and then 1993-2001 were pretty good also(except for free trade terrible idea), unfortunately we have stripped most of our regulation and taxations under the pretext business will create jobs and increase wages for us...hasn't worked out so well...everyone says we are overtaxed and overregulated...but dont bother to compare it with the last 80 years our amount of regulations and taxes are at all time lows.

[belfpala]

I don't have to close at 2am....

[Yvaelle]

There are a lot of ways you could go with something like this - it depends on how far you want to go, and whether you want to affect socioeconomic structure.

I think the over-arching theme of my reform would be industry-specific studies of the best practices of other nations, and then updating industry regulations to those that work best - becoming the frontier policy environment for each industry in the world.

Defining what 'best' is, is obviously very important - my answer is the population of the society itself - so much of the reform might have to do with improved labour practices and enforcement (ex. ensuring people are paid for all the hours they work / eliminating wage theft), as well as ensuring safety best practices per industry - maximizing the productivity of the labour force by minimizing accidents.

Next you have environmental best practices - the burden placed on the environment impacts society for generations to come - this burden needs to be accounted for - or it is a subsidy to industries that pollute versus ones that do not: a cost paid for by society to reduce the operating costs of a struggling or ineffective industry. That doesn't mean that every industry has to go crazy eco-green nonsense - but this can have big impacts on certain industries.

For example, the coal industry would not be cost-efficient over solar, wind, or hydro-electric if the industry was expected to cover the costs of their emissions - the same is true for the oil industry - the only reason green energy (and natural gas) are not the cost-efficient energy solutions of today, is because the fossil fuel industry is exempted from cleaning up after themselves: the taxpayers subsidize the environmental price.

On the topic of subsidies, I'm a hardline believer in the over-use of subsidies within modern developed economies. Subsidies are meant to be short-term solutions implemented only to avoid greater economic damage (through disruption to jobs and closing companies) in the wake of unexpected catastrophe: if a disease destroys the strawberry industry of California one year - and all the strawberry companies are at risk of going under, and tens of thousands of jobs will be lost - creating turmoil in the labour market - you assist the strawberry industry for that season to ensure they can continue uninterrupted into the next where they will resume full production into the future.

Or, if you want to push everyone toward electric vehicles (which we will see in the next few years) - you subsidize their purchase to encourage socio-economic policy that will accelerate the transition away from fossil fuel over-reliance. Economic aide to industries in the wake of an 'act of god' should occur for a quarter/season - maybe up to one year at the most - no industry should be subsidized for decades (as almost every industry currently is, in the US).

If people no longer use horse-drawn carriages, you allow that industry to die, you do not indefinitely support a non-competitive business model (end corporate welfare). Encouraging socio-economic policy through consumer subsidies (ex. electric car subsidies) can take more than a single year, but even these should be capped at something like 3-5 years - after which if the transition has not sufficiently occurred, something is wrong with the subsidy / business model.

To focus on more specific industries:

Telecom
The internet is a public utility - like water or air - it cannot be left to the turfed-monopolies of the telecom giants. Regulations are necessary to ensure competitive practices, criminal prosecution of collusion, and net neutrality. If they bitch and moan, word one - I want the entire telecom industry nationalized (speaking as a Canadian). I'll give them a chance to get their act together, but I'm sick of their shit.

Financial Services
Commercial banks must be separate and distinct entities from investment banks - in the US this means returning Glass-Steagall and the slew of smaller policies that went with it. The financial industry is so critical to the economic success of a nation that it poses a national security risk greater than any modern war.

Canada is a world leader in financial policy - but it can still be refined. Specifically though I would like to see America regulate their financial industry, because their financial malfeasance is a global threat. If something is "too big to fail" that should mean you prevent it from failing in the first place. The most important attribute of a healthy economy is not rapid growth, but stable (steady) growth: this must be prioritized through policy.


Edit: Going a step further. There is something fundamentally flawed with the fiduciary duty of public corporations - the future, we may need to redefine fiduciary duties away from the maximal monetary return to shareholder's, and toward the maximal gain (monetary and otherwise) of stakeholders (not just shareholders). A small wording change that could fundamentally reshape the unhealthiest aspects of capitalism.

[Mayhem]

if we´re going to continue this corporations are people then damn they have to get treated like one if they mess up or do something illegal

so if the decisions of the board can´t get them behind bars because apparently it was the corporation, well guess what, then the corporation goes behind bars (not literally) but as a real person couldn´t do their work for 3-6 months (just an example) the same should be for a corporation that´s been found guilty, they then either depending on how severe the crime was can pay a certain amount that should be on paar with the sentence or take it and stop production right away

about bankrupcy i´d say their assets including their facilities and workers are undertaken by the state and then sold to the highest bidder

so for example when a car company goes down, the ones that profited the most have to give enough money so that workers are able to finance retraining, the factories are then run by the state, and as quickly as possible sold to another still running car company, if there are no interested parties then the retraining starts, everyone that finds a job in his field doesn´t need retraining and the money goes back to the ones it came from

so there are 3 scenarios:
every worker is getting a new job in another company (great for the old bosses, they keep all they´ve earned)
some worker are getting new jobs in another company, some have to get retrained (not so great for the old bosses anymore, but at least they don´t have to pay that much)
no worker is getting a new job in another company, everyone has to get retrained (worst case scenario, losing the company and a whole lot of money in the process)

every contribution to parties/party members must be at full disclosure and open to the public, the misinformation has to stop, or stop money in politics alltogether, can´t decide on this

oh and a news network that is publicly funded, that needs to tell the truth by all means without having to care about advertisment

[Independent voter]

Specifically though I would like to see America regulate their financial industry, because their financial malfeasance is a global threat. If something is "too big to fail" that should mean you prevent it from failing in the first place. The most important attribute of a healthy economy is not rapid growth, but stable (steady) growth: this must be prioritized through policy.

This is interesting to me. Yes deregulating the free market caused the housing bubble which brought about a huge bubble and when the bubble popped it affected nearly everyone in the world. That's true. But what is also true is the reason the US economy is surging ahead now, dragging all the other economies with it is because of the free market.

Two edge sword.

[banur]

Who's interest has the most value?

The individuals interest is the most valueable.

I always feel like the workers' interests have more value.

Who are "the workers"? They are just a group of people and can have different interests. Do you go by majority vote? Then it is the the interest of the biggest mob.

I would make it illegal for Companies or Corporations to Donate to Political Campaign funds (it's actually buying favours and 1/2 the reason the System is fooked)
I would set a limit to personal wealth creation - excess goes to the state..
I would set a limit to Compainy / Corporate Profiteering - excess goes to the state..
I would pass a law stating that any company lobbying the government for a bail out, the government then 'OWNS' X% of said company based on company value and the amount of the bail-out.
And I would prosecute all of the high-level execs who allowed their companies to take part in the sub-prime fiasco that practically brought the planet to it's knees...

How about reducing government powers to a level where it is of no interest for businesses to "buy" political influence and where the government does not bail out businesses? If your business fails because you made bad choices, go down or seek other voluntary support.
Setting limits to personal or corporate wealth kills business. Why would a person or business work more once they reached the cap?

[Yvaelle]

This is interesting to me. Yes deregulating the free market caused the housing bubble which brought about a huge bubble and when the bubble popped it affected nearly everyone in the world. That's true. But what is also true is the reason the US economy is surging ahead now, dragging all the other economies with it is because of the free market.

Two edge sword.

Most economists I know (I did my masters in economics, so I know a few) expect another US financial bubble to burst in the next ~six months - the rumour has gone around for at least half a year now. The biggest issue by far is the absence of corrections - the DOW for example has risen for almost 40 months straight without a correction - where most any other health economy has minor corrections every six months to a year: a ~40 month rise is highly suspect.

There are only three instances in US history that the market has gone this long without a correction - before the Great Depression, before the Great Recession, and before the 1975 collapse - it has now past the dot-com bubble of the last 2000's.


Marketwatch did a very solid piece on it back in July.

"For one thing the economy has not grown anywhere near as much as stocks over the past 5-1/3 years; neither have corporate profits."

That's big cause for concern - since that is literally the definition of a bubble:

"A stock market bubble is a type of economic bubble taking place in stock markets when market participants drive stock prices above their value in relation to some system of stock valuation."

Another great (and very ominous) indication is the decline in 10 year bond cycles - meaning that investors are concerned the recovery time from an upcoming recession could have very long-term impacts - an impact that suggests getting your assets out of USD entirely.

This is the result largely of the Federal Reserve, who have kept such a low federal funds rate and interbank rate - that the banks may have again set themselves up for a cascade failure of the financial sector again - because they refused to create meaningful regulation last time (2008/2009). Obama's economic recovery efforts (and Bushes TARP) were really strong at minimizing the damage of the 2008/2009 crash.

The US recovery has occurred entirely due to those policies - but it means nothing if you let the financial sector set up their boom/bust trap again (which it appears they may have done, again).


Edit: The "two-edge sword" of a boom/bust cycle is always detrimental - you (the economy) lose more than you gain in the long-term - it's not worth it. There are a ton of reasons why this occurs - but the simplest to explain is disruption / inefficiency. Picture two economies, one that grows by 8% year but occasionally busts - and another that grows by 4% per year and never busts.

In the first economy, every time a collapse occurs - people lose their jobs - productivity, output, and consumption all fall dramatically during a crash. When the economy rises again, consumption rises as well - a faster growing economy might mean faster consumption - but the transitionary period of a collapse - where people are out of work or finding new jobs - is productivity forever lost: no matter how steeply the growth is after the disruption ends.

The second economy is always fully productive, employment remains high - so that while consumption may not be quite as steep as the faster economy, consumption never stops. Stock prices in a stable economy best reflect the value of the company, because they transition much slower and closer to true value - since variables move slower in the second economy - predictions are more accurate (reducing the likelihood of bubbles in every industry). The value of a stable economy is far greater than a boom/bust-cycle economy.

The only people who benefit from boom/bust cycles are the financial industry themselves - banks profit whenever money moves - it doesn't matter whether the money is going in or coming out of the bank, it doesn't even matter whether they make good investments or bad ones - if money changes hands, banks get richer, faster. Boom/bust cycles lead to far more movement of funds - nobody (including corporations) can save because disruptions kill savings - so all the money in the economy is constantly in flux. Stock prices rise and fall rapidly, which encourages investment (both internal and foreign investors) - and whether the investors win or lose, the banks profit.

The fiduciary duty of unregulated banks is to have the most volatile economy possible - since that is what maximizes the banks profit - which is directly in conflict with the best interests of every other industry, every citizen, and the country itself. Banks must be strictly regulated - otherwise they are nothing more than sanctioned terrorists.

[Deleted]

I want a worldwide maximum wage. For example: You can't, aren't allowed to, can never, in any way shape or form, earn more then 25 million € / year (placeholder number).

You are allowed to make profit over 25 million / year, but you are obliged to give 50% to the state and 50% to charities of your own choosing.

And yes, you would have to pay taxes on your 25 million a year.

Numbers are just placeholders tough.