Government regulations are costly, not only on the surface, but also in the unseen results they bear. Regulations, such as various state statutes banning the multiple hook baits known as Alabama rigs, have resulted in the unnecessary expenditure of research and development dollars of tackle companies like Mann’s Bait Company on the exploitation of loopholes that statutes inadvertently create.
While it can be argued from a utilitarian perspective that these statutes have “stimulated” innovation, to what extent could that research and development money have been used on another product that would enrich my life? While the example of a fishing lure seems rather frivolous, it is merely a small example of something that can be more simply explained than another matter of greater complexity or seriousness to society. In light of my example, couldn’t those dollars have been spent on yet another bait that would spawn the spontaneous order that exists in the fishing lure market and many other markets with low cost of entry and significant lack of intellectual property protections (notably, the garage lure-makers and those who make and sell after-market accessories)?
Had the money that Mann’s spent on skirting the existing statutes to make a bait that will possibly be affected by future statutes been spent on a new concept, there would be a real stimulation, a real demand for products at every level of the market, from components to the final product offered at the local tackle shop. While statutes have created such an innovation, it’s still a market distortion that would not exist had government not intervened to tell anglers what was acceptable to fish with.
Thinking with an economic mindset has made me realize that this exists not only in the world of bass fishing, but in every aspect of the market. It is representative of, as Bastiat mentioned, the unseen that policy-makers do not consider when they write laws or take actions, no matter how well-intentioned they are. For every statute on the books that “created” one product, hundreds more were not created. Entire legal markets wither as a result of bans of certain items or mandates for other items. While these products remain unseen, the lack of employment in certain sectors can be seen. The suffering of families whose income providers were laid off can be seen. The fall in sales of the small-business owner can be seen. At the personal level, our standard of living decreases, or doesn’t become what it had the potential to be. All of this is due to bureaucrats whom are overzealous in telling us that we are better off without something or telling us that we absolutely need something.
I’d like to see a world where Mann’s Bait Company and thousands of small business owners can actually innovate and sell their products without having to concern themselves with such market distortions that ban or mandate certain products. I’d like to see a world where no business has to contend with such regulations and can actually put money into areas where it needs to be placed: inventory, payroll, merchandising, displays, and, the elements that actually stimulate real employment, spending, and innovation. It’s basic morality to allow mankind to design, create, and sell what his mind can conceive; to do otherwise violates his natural right to the fruits of his labor.