"The Options Destroyers" by Thomas Sowell originally appeared as a newspaper article; it is narrated in this video:
This piece dovetails with what I recently read in Sowell's Intellectuals and Society,
as well as a recent video post by the folks at Reason. Top-down regulations, by their very nature, reduce the number of options for consumers in the market. That's what they are designed to do: reduce the number of perceived bad options that otherwise free people might act upon. (Soon we will no longer have the option--freedom, that is--to purchase incandescent light bulbs.) Real life choices become fewer as a result of the near-sighted effects of reform crusaders and their vote-catching politician allies in legislatures. What's a recent and real world example? Oregon's state wide ban on payday loan interests rates above 36%, mentioned in a recent Freedom Lessons post. Poor and options-strapped folks in Oregon now are even more options-strapped.
Worse still, excessive regulations introduce a third set of terms between consumers and the purveyors of goods and services. When left free to cooperate and interact freely, consumers and businesses make mutually beneficial transactions. That's mutual consent between two parties. Intrusive and short-sighted regulations introduce a third party--the options destroyer--and force a third set of acceptable terms into the transaction, thus providing disincentives for economic activity.
Rent control is a good example. Landlords are forced to satisfy both their tenants' demands and the demands of local governments. With less profit to make there is less incentive to upkeep buildings, let alone provide new living quarters to the public. An artificially high number of people want to rent due to an artificially low rent, and an artificially low number of apartments are available to rent. Real shortages occur, existing buildings deteriorate, slums crop up, and commuters are forced to travel great distances past empty and boarded up buildings.
In a free market unhampered by well-intentioned busy-body do-gooders pushing intrusive interventionalist policies upon us, we self-interested people who know best about what is best for ourselves would find a way to get by just fine.
Just think about all the options we would enjoy!
