Freedom by Regulatory Fiat?

Wednesday, October 28, 2015

Over at Vox is an article by Matthew Yglesias whose title sounds like something I can agree with: "Car Dealers Are Awful. It's Time to Kill the Dumb Laws That Keep Them in Business." The article is worthwhile, but ends up making a very common error -- the one, in fact, responsible for the very existence of our meddling regulatory state:

What the FTC doesn't have is an actual proposal. But while the federal government can't directly step in and repeal state-level bans on direct auto sales, it can take advantage of the large federal role in transportation finance. A quarter of all transportation funding flows from Washington through various grant programs. Some of that money should be set aside in a "best practices" pool and made available to states that allow for open entry into the car-selling market, while states that refuse to reform will lose out. [link in original, bold added]
The author, at first blush, seems to be saying, "There are too many laws: There oughtta be a law!" His diagnosis and solution are both wrong, and it is interesting to consider what is wrong in light of his reasoning.

Earlier, Yglesias notes that part of the problem is that, "[C]itizens simply don't pay much attention to state politics, making it even more of a plaything for special interest lobbies." Perhaps "citizens" ought to take some responsibility for what an entity that can point guns at people is doing, particularly since it is doing so to their detriment, rather than protecting their individual rights. This proposal honors a very bad precedent: That the solution to bad laws and regulations is another layer of the same. Furthermore, it is naive to assume, as Yglesias apparently does, that a government big enough to bully one that is pushing everyone around will act benevolently.

Even one law that violates individual rights is too many. The solution to the problem is to work towards the day when we can abolish all such laws, and there is no substitute for persuading people to take an interest in the issue and see that such a course is to their benefit.

-- CAV


Todd said...

In my state, car dealers are forbidden from selling on Sundays.

Gus Van Horn said...


That follows the precedent set by liquor in most (if not all) states. It is interesting to consider the role this remnant of Prohibition (and indeed Prohibition itself) had on getting Americans used to the regulatory state.