Thursday, May 29, 2008

Too Much Regulation Hurts A Free Market

Keeping a free market going is a bit of a balancing act.  On the one hand, if it is entirely unregulated, monopolies start to form.  These monopolies will then prevent other businesses from competing by either buying them out or underselling them or something similar.  This in turn stifles innovation and takes choice away from the consumer.  On the other hand, if you have too much regulation it stifles a business.  When a company can no longer choose how it acts and is forced to spend a large portion of it's income on compliance with regulations innovation suffers and barriers to entry are created.  You can't just start an insurance company, there are certain rules and regulations you have to follow.  The same with any other business.

It is government's job to make sure that business stays competitive by creating appropriate regulations.  However, if government goes too far, it runs the risk of having the solution be worse than the problem.

The other thing about regulation is that it doesn't always do what was intended.  For example, when the government first gave businesses tax breaks to insure their employees, it was to encourage them to offer insurance.  It was supposed to give people more access to insurance.  Today it is almost the only way a person can afford insurance.  It takes away our choices because we only get to pick what our employer offers.  It stifles competition because insurance companies aren't catering to people any more, they cater to HR departments which usually choose the cheapest plans not the ones that are best suited to all of their employees.

So how do we fix bad regulation?  Well, one of the problems is that once it goes on the books, nobody ever goes back and checks to see if it is working like it should.  Therefore, I believe that all regulation should have an expiration date.  If a regulation is passed, it will automatically expire in two years.  At that point it can be extended but not for more than five years.  This forces the legislature to review regulations regularly.  They can ask if they are doing what they were intended to do and if they are a help or a burden to businesses and the consumer.

As for existing regulations, expire them at the rate of five or ten a year, starting with the oldest.  Basically, enough that meaningful change can happen but not enough that the legislature is overwhelmed with a hundred years of regulation.

Not all regulation is bad but there is a risk whenever government dictates how the market is to operate.  Lets mitigate that risk by insuring that all regulations are periodically reviewed and by allowing unnecessary and counterproductive regulations to expire.  This helps business which lowers cost for consumers.  It's a win win proposition.

Monday, May 19, 2008

How Do We Help The Poor in America?


Poverty is a tough issue.  Unfortunately, it's an issue that has been oversimplified.  Granted, it's really easy to oversimplify.  The conservatives tend to think that the poor should get jobs and work for a living like everybody else.  The liberals think it's unconscionable that a person starve and/or live on the street simply because they don't have the means to take care of themselves.  Therefore, it's the government's responsibility to feed and house them (or at least provide them with the resources to feed and house themselves).

So who's right?  I admit that I side more with the conservative view.  People need work, not handouts.  However, I recently learned that the issue is more complicated than that.  

My original idea was to eliminate welfare and have that money go toward employment.  So, if somebody qualifies for welfare, instead of giving them money, you give them a job.  Doesn't matter what the job is - they can clean up the streets, paint over grafitti, run day-care for other people with "welfare jobs", etc.  The point being that people worked for their money.  Free hand-outs only encourage sloth and dependence in the long term and doesn't help people to help themselves.

I figured that my plan would be the best of both worlds.  It makes conservatives happy by putting people to work and it makes liberals happy by giving help to those in need.  So, in my plan, if you starve to death it's because you're not willing to work, not because you can't find work.  Best of all, it encourages the poor to get better jobs (welfare work would only pay minimum wage or something like that) so that they can earn more money for the same amount of work and get off of government support.  So it helps people and the economy.

So what's wrong with my idea?  It operates off of the assumption that those who have grown up in poverty are simply middle class Americans with less money.  Well that's simply not true.  My wife recently went to a conference where one of the speakers had actually started out poor and was able to work her way up to financial security.  From that speaker my wife and, by association, I learned that poverty is as much a mental as it is financial.  The poor see the world differently than those who have enough and it's this mindset that has to be changed before the poor can really improve themselves.

So how do we do it?  I don't know for sure but my best guess at this point would be to add education/counseling to the work program.  Maybe for an hour a day (part of the work day so they get paid for it) we teach the people.  Teach them how to manage money, teach them how to live in middle class society, teach them what their potential is and help them develop a drive to reach that potential.

Although we may never be able to truly eliminate the poor from among us, we should be trying our best to help them help themselves.  Welfare, as it currently stands, is not a long term answer.  If you give a man a fish, you feed him for a day.  If you teach a man to fish, he may end up starting a seafood business that employs hundreds of people and revolutionizes the fishing industry.  We should never sell anyone short on their potential.

Thursday, May 15, 2008

The Party of Opportunity


Thanks to the leadership of Barak Obama, the Democratic Party has been effectively positioning themselves as "The Party of Hope".  However, when you look at their policies, it seems to really be the party of security (as in social security/social programs) or the party of entitlement.  I don't want to be too negative because I know many democrats and they sincerely believe that government intervention is the solution.  Personally, I don't agree with that point of view (which is why I'm a Republican).  However, it seems that my party has lost its way over the last few years and it's time to come back to our roots.

Here are some of the values that have drawn me to the Republican Party:

  • Lower Taxes:  Most everything we buy has been taxed two or three or more times by the time it get's to us (not even counting sales tax).  It's too much.
  • Smaller Government:  Of course our high taxes are paying for a huge, bloated government.  Government needs to be smaller, less redundant, and more agile in order to respond to the needs of the national and international issues facing us as Americans.
  • Less Regulation:  Just as a pure capitalistic economy promotes monopoly and stifles innovation, an over-regulated economy promotes bureacracy, inefficiency, and stifles innovation.  The trick is to find the proper balance.
  • Individual Liberty:  Most Americans don't want to be told what to do.  We don't want to give up our freedom for "the good of the whole" because, at the end of the day, it's "the whole" that suffers.

I see the Republican Party with the potential to help people help themselves.  Our policies should be aimed at giving people the tools they need to succeed on their own.  We are not the party of security but The Party of Opportunity!  

Now I don't know how my points stand up to the official principles of the Republican Party but they're the closest that I've found so I'll stick with them as well as sticking with my personal values.  I think the party is moving in the right direction and I find that very encouraging.

Tuesday, May 13, 2008

New Political Direction


You know, knowledge is a funny thing. No matter how much we think we have, there's always more out there to get. No matter how well we think we understand something, there always seems to be more to it than that. Political issues are much the same; at least with me.

When I first look at an issue, I see the surface of it. Usually it's fairly simple which makes it easy for me to see a solution. However, as time goes on and I learn more about the issue, sometimes my "solution" turns out to me not as much of a solution - in fact, sometimes it makes the problem worse in the long run. This is one of the reasons I blog, I want people to see my ideas. Not because I want to be famous, but because I want the good ideas to be implemented and the bad ideas to be corrected. As fun as it is to think that all my ideas are perfect, I know they aren't. However, what I don't know is which ideas are wrong and where they go wrong. If I did, I'd fix them.

Recently I've been going to a seminar put on by the National Center for Constitutional Studies. This seminar focuses on the Founding Fathers and what they were thinking while debating the Constitution.  While I'm not in 100% agreement with their conclusions, the information taught has changed a lot of my perspective when it comes to government. Perhaps I should correct myself and say that it's changing my perspective. I'm not sure where I'll end up from this but it is challenging some assumptions that I never thought to question before. That's a good thing. Perhaps after pondering this new information, I'll draw the same conclusions that I drew before. Perhaps I'll change them. The important thing is that I'm thinking about them.

Knowledge, ideas, issues, and solutions should never be assumed infallible and left unquestioned. We should not be afraid of challenges to our ideas/beliefs. As we re-examine them we will either become more convinced of their correctness and better able to share them with others, or we will see the error of our ways and be able to change before any more harm is done.

The problem with today's political climate is that it's too polarizing.  If you're a Republican, it's assumed that you feel that any idea from a Democrat is wrong and visa versa.  There doesn't seem to be any real debate, any compare/contrast of different ideas, or even any agreement.  Why is bi-partisan legislation such news?  Shouldn't it be the norm?  Why is it that if a Republican has an idea that Democrats feel they have to fight against it and visa versa?  Why can't we discuss our ideas like human beings instead of yelling and fighting all of the time.  I think some more honest discourse would do our country a world of good.

So what I'm saying is that I've started to re-examine some of my ideas.  I'm trying to apply some of the thoughts and views of our Founding Fathers into my thinking and see if I reach the same conclusions.  Stay tuned, this might get interesting.