Industry self regulation?

[Pure]

According to our "free market" friends, an industry does best--FOR EVERYONE-- when it regulates itself, or, same thing, the market regulates it: so if a product is inferior, people stop buying, and then there is pressure to upgrade or discontinue. "Market mechanisms" will automatically protect the public good (since manufacturers of unsafe items go out of business in a hurry.)

Further the "free market" argument is that government regulation, through legislation, is generally a) bureaucratic, b) inefficient, c) ineffective. It drives up the costs, without producing much if any benefit.

Liberals and social democrats hold that governement regulation, according to legislation, is--under certain conditions, e.g. NON corruption-- generally effective, i.e. succeeds in its objective, most of the time.

For instance, the FDA approved drugs are generally safe; it has kept MOST harmful drugs off the market, with the odd slip up.

Additionally, one might note that the 'slips' are often due to industry pressure or "cooked data" or "corrupt influence"; the first case, taking too little time to assess; the second case, relying on industry generated and furnished data as to safety.

So, re industry regulation for safety of items we or our pets consume, that is, foods, supplements and drugs.

 

[S-Des]

You know, I'm not a big believer in either, but I know starting up a business is a nightmare because of government interference. The store I teach at was informed this year that the IRS rules regarding independant contractors had been changed and they would be forced to make teachers employees instead of sub-contractors. They were informed that they had 4 weeks from the date of the notice (three weeks left by the time they received it) to come into full compliance (i.e. change the paperwork for 20 teachers, and pay thousands in taxes...despite the fact that the teachers had already paid taxes as independant contractors, so the IRS was getting paid twice). The tax lawyer informed them that they were in the right, but it would cost at least $250,000 to fight and in the end they'd probably lose (or the IRS would punish them in a different way for fighting it). It came close to them forcing the store to close, but they pulled it off at great personal cost. Most people who own businesses are no match for the bullying tactics employed by the government. Governments are notoriously inept and often corrupt. If you want to put your faith in them to control and regulate everything, you are really taking your chances.

 

[rgraham666]

To say either government or business is 'inefficient' or whatever is to use an a priori argument. Both are simply tools. They can't do anything other than what their users, and that's us people, ask them to.

And to think that the marketplace favours better products one only has to look at MicroSoft. They've been coasting for twenty years on an extraordinarily ordinary product.

 

[Pure]

by "ordinary" you're saying "crappy", but in a diplomatic way... yes?

--

PS. rg, my favorite example regarding effects of markets (aside from McDonalds) is the typewriter keyboard. the QWERTY board has triumphed. in fact we know it's one of the least efficient arrangments [indeed, it was DESIGNED to slow people down!], yet no "competitor" e.g. Dvorak, has been able to dent it.

 

[wehstar]

The problem is that it is not about quality, it is about the public perception of quality - which basically seems to come down to marketing.

Just look at some of the worlds top singing sensations - actually they're not really singers, they just look good.

 

[Liar]

The problem is that it is not about quality, it is about the public perception of quality - which basically seems to come down to marketing.

Just look at some of the worlds top singing sensations - actually they're not really singers, they just look good.

That's just a case of a common market confusion. It's not the music industry. It's the entertainment industry. And entertainment, they deliver. Or at least they are entertainment that someome else (video directors, et al) deliver.

 

[wehstar]

That's just a case of a common market confusion. It's not the music industry. It's the entertainment industry. And entertainment, they deliver. Or at least they are entertainment that someome else (video directors, et al) deliver.

The point is the vast majority of people don't know whats good for them, but they like to be told what's good for them, and that's enough.

 

[Liar]

The problem will laissez faire is that for people who support it, it becomes the laissez fairy, who puts perfectly functioning blossoming utopias under their pillows at night, while for those that oppose it, it becomes the laissez fear, spreading like the bubonic plague and looking only half as pretty, as it lays waste to Mom and Pops and makes all land areas of the planet into parking lots.

I'm more of a laissez fair kind of guy. Leave the market as alone as it's pragmatically possible, but don't be religiously stupid about it, and we'll probably be ok.

 

[Jenny_Jackson]

I've been saying for 20 years - NO FUCKING WAY! We have spinich giving people E. Coli. We have pet food manufacturers killing dogs and cats with melimine. The controls on the human food chain isn't stringent enough. As for pets, there are no controls at all until we have the kind of mess we have now.

 

[dr_mabeuse]

A hammer's a great tool but it can't cut. A saw's a great tool toom but it can;t drive nails. What kind of an asshole carpenter woiuld set out to build something using only one or the other?

There are some things that private business does exquistely well. There are some things at which they fail abysmally. The same is true for governent. The ideal system is an eclectic mixture that combines the strengths of both.

Since when did it become dogma that we must have one system or the other but not both? When did we become such rabid idealogues? Such stupid carpenters?

Before the FDA you could legally buy medicines laced with strychnine and baby mattresses died with arsenic. No one was particularly interested inlooking into the toxicity of these substances and in fact, such research was rather actively discouraged by financial interests. The Pharmaceutical industry has no incentive to promote public hygeine or undertake mass vaccinations because there's no profit it in. They'd make more money by selling the cures than by preventing the disease.

Similarly, Business isn't motivated to conduct pure research of no apparent commercial value. The research that gave birth to the nuclear power industry was all done by the US government and most of it still is.

I have little doubt that if the government would get off its ass and put as much money into energy research as we did into getting to the moon, we could lick the energy problem in 10-20 years. Industry has had 15-20 to have a go at it and so far their record is pretty damned dismal.

The key is not to think in terms of one or the other - either Business or goverment - but of using both. It seems to be an idea we've entirely forgotten.

 

[S-Des]

The key is not to think in terms of one or the other - either Business or goverment - but of using both. It seems to be an idea we've entirely forgotten.

That's because it's so much more satisfying to blame all your woes on some nameless, faceless evil entity. It's all their fault.

 

[starrkers]

When being in business is about providing a product (or service) self-regulation is fine. When it becomes more about making a profit than providing a good or service, self regulation is void.

 

[elsol]

The market is reactive.

In the case of harmful products... someone, or lots of someones, have to be harmed before the market puts a slap on the business doing the harm.

Are you willing to be the one that dies?

I'm not.

Nor do I trust someone to think of my safety over the bottom line when their multi-million dollar bonus is on the line.

 

[Pure]

note to the dr.; note to el

dr.The key is not to think in terms of one or the other - either Business or goverment - but of using both. It seems to be an idea we've entirely forgotten.

doc, i think the US "liberals" think of both, don't they? in w. europe, the "social democracies" in Scandinavia that I admire have "mixed economies" (allowing for some private ownership, but still subject to regulation).

in my poll choices, all but the first and the second were rather mixed. in the last choice spoke of regulation rather than ownership, taking it out of 'classical socialism.'

---
note to el:
i think the 'time lag' problem is serious. iirc, adam smith, the 'classical liberal' and 'free market' person allowed for government control of sale of poisions, and poisonous goods.

i'm not sure what the pure "free market" folks, including the randists have to say, here, since they haven't ventured in the thread. i suppose they would say that the resulting evils are greater than the problem, since no vendor REALLY wants to sell spinach with e coli, or bad milk.

the other problem, of course, is the 'fly by night' persons. these flood the market for a short time, with a crappy 'good,'--worthless medicine-- then disappear. i suppose the 'right wing' answer here--not a bad one-- is to have prosecutions for fraud.

so along the same lines, the 'answer' to the spinach problem is for the growers to put a label --certified pure and clean-- voluntarily. then no one buys anything else (? shady restaurant owners; pet food makers). anyone selling with a forged label is prosecuted for fraud.

 

[mikey2much]

I begin to think that you might have your shit together

A hammer's a great tool but it can't cut. A saw's a great tool toom but it can;t drive nails. What kind of an asshole carpenter woiuld set out to build something using only one or the other?

There are some things that private business does exquistely well. There are some things at which they fail abysmally. The same is true for governent. The ideal system is an eclectic mixture that combines the strengths of both.

Since when did it become dogma that we must have one system or the other but not both? When did we become such rabid idealogues? Such stupid carpenters?

Before the FDA you could legally buy medicines laced with strychnine and baby mattresses died with arsenic. No one was particularly interested inlooking into the toxicity of these substances and in fact, such research was rather actively discouraged by financial interests. The Pharmaceutical industry has no incentive to promote public hygeine or undertake mass vaccinations because there's no profit it in. They'd make more money by selling the cures than by preventing the disease.

Similarly, Business isn't motivated to conduct pure research of no apparent commercial value. The research that gave birth to the nuclear power industry was all done by the US government and most of it still is.

I have little doubt that if the government would get off its ass and put as much money into energy research as we did into getting to the moon, we could lick the energy problem in 10-20 years. Industry has had 15-20 to have a go at it and so far their record is pretty damned dismal.

The key is not to think in terms of one or the other - either Business or goverment - but of using both. It seems to be an idea we've entirely forgotten.

If I ever have to go to court I want you to defend me. I like the way your mind works.
mike