No matter how much evidence I provide about the checkered record of economic regulation, my students generally believe that we need regulation of our economic lives, “otherwise chaos would result.” We’ll address this in a series of posts, including the creation of a repository of evidence on the record of legislation (for example, the tobacco companies are BETTER off now that they have entered into the tobacco settlement and are as heavily regulated as they are …). For this post, I wish to address two simple questions:

1. What is regulation?
2. Are the aspects of your life without regulation chaotic?

When I ask these questions of students, I rarely get any intelligible answer to (1). And for those clever enough to think of an area that (2) applies, I have never, not once, ever seen or heard evidence of chaos. So my question to all of you that believe that an expansion of private voluntary arrangements would unleash hell on earth is, “What exactly is regulation?” What things do you have in mind? And once you answer that, then please kindly address the following questions:

• What person or group of persons has the requisite knowlege to craft such rules, and conduct such oversight, that you describe for me?
• What person or group of persons, even if they had the requisite knowledge, would follow through on these in an ethical and disciplined manner?
• How would you design regulatory institutions that would prevent greedy private interests from hijacking the process?
• How would design regulatory institutions that are dynamic and flexible enough to foresee future economic problems and not react late to old problems?
• And how would any of the above outperform the world’s most efficient regulator – free and aggressive and open competition?

I bet you a dollar to a donut that you will hear crickets when you pose these questions to a state-lover.

But it is even more fun to make folks consider the second of my two questions above. Can you tell me an area of your life that seems to be unregulated? Surely most aspects of your dating/social life are safe from the grabbing hand of governmental institutions. Would anyone characterize the dating market as a skiff at sea in a maelstrom? And if so, what “regulations” would you impose to improve the “chaos” of the dating market? Or generally, since people seem to think people are not responsible enough to be left alone in their economic lives, then by what right do you have to argue that they are responsible to be left alone in their social lives? Why should we not regulate where you can go on a Saturday night? And who you can go out with? Gosh, just think of the chaos that would ensue if you get to choose your own friends (wouldn’t this competition be destructive and exploitive)? And gosh, just think of the chaos that would ensue if you had the freedom to choose which church to attend, which charities to support, which community groups to belong to, which hiking clubs to join, and god knows what else.

So what is different about your economic life – deciding which supermarket to shop at, where to work, the terms of your employment contract, which banks to use, etc. – that requires such close watch by people OTHER than you? Pray tell, please?

Crickets.