Regulators Are Almost By Definition Anti-Consumer

Free markets are governed and regulated by consumers.  If suppliers offer something, and consumers like it and like how that particular supplier provides it more than other choices they have, the supplier will likely prosper.  If suppliers attempt to offer consumers something they don't want or need, or already have enough of from acceptable sources, the supplier will likely wither and disappear.  That is how free markets work.  Scratch a Bernie Sanders supporter and you will find someone who does not understand this basic fact of consumer sovereignty.

Regulators generally are operating from a theory that says there is some sort of failure in the market, that consumers are not able to make the right choices or are not offered the choices they really want and only the use of force by regulators can fix this failure.  In practice, regulators have no way of mandating a product or service that producers cannot economically or technically provide (see: exit from Obamacare exchanges) and so all they actually do is limit choice by pruning products or services or individual features the regulators don't think consumers should be offered.   They substitute the judgement of a handful of people for the judgement of thousands, or millions, and ignore that there is not some single Platonic ideal of a product out there, but thousands or millions of ideals based on the varied preferences of millions of people.

A reader sends me a fabulous example of this from the Socialist Republic of Cambridge, Mass.

Month after month, in public meeting after public meeting, a trendy pizza mini-chain based in Washington, D.C., hacked its way through a thicket of bureaucratic crimson tape in the hopes of opening up shop in a vacant Harvard Square storefront. But when the chain, called &pizza, arrived at the Cambridge Board of Zoning Appeal in April, the thicket turned into a jungle.

Harvard Square already has plenty of pizza, board chairman Constantine Alexander declared, and though a majority of the board signed off on &pizza’s plans, approval required a four-vote supermajority. Citing the existence of five supposedly similar pizza joints in the area, as well as concerns about traffic congestion, a potential “change in established neighborhood character,” and even the color of the restaurant’s proposed signage, Alexander and cochair Brendan Sullivan dissented.

“A pizza is a pizza is a pizza,” Alexander said at one point during the April hearing, sounding suspiciously like someone who doesn’t eat much pizza or give much thought to the eating habits of the 22,000 or so college students who live in the city.

A city ordinance dictates that any new fast-food place should be approved only if it “fulfills a need for such a service in the neighborhood or in the city.” But the notion that an unelected city board should be conducting market research using some sort of inscrutable eye test to decide precisely what kind of cuisine is appropriate for Harvard Square stretches that to the point of absurdity.

  • Peabody

    I briefly checked out &pizza and they talk about a "living wage" and have gluten free options. If they can't get approval by the lefties, the rest of us are certainly doomed.

  • SamWah

    This would be protecting the current pizza parlors from competition. Is someone or someones getting a payoff?

  • ErikTheRed

    The funny thing is that the overwhelming majority of regulations like this are imposed by people whose preferences are driven by their higher incomes and social status on those who have younger tastes and / or lower incomes and therefore a very different set of cost-benefit ratios. What's funny about it is that the regulator class can't stop screeching "check your privilege" every five seconds, while they continuously and unendingly inflict restrictions based on their opinions that were developed in a highly-privileged environment.

    Personally, I was pretty damned poor (well, by first-world standards) when I was younger. I lived very frugally and did all of the cliched things to save money - ate crap food, lived in my car, bought everything at WalMart (occasionally splurging at Target), and even *gasp* took out a payday loan or two. Most of these decisions were driven by short-term thinking deeply constrained by cost. I'm doing pretty well now and would strongly prefer to not go back to living like that, but I understand what these young and / or poor people are doing, why they're doing it, and I respect their decisions even when I think they're sometimes deeply suboptimal.

  • StillAnOptimist

    "A person is a person is a person" (that brilliant zoning guru was overheard saying) - and then she proceeded to say "We cannot allow any more human to move to Cambridge - we have enough people already" - and rumor has it that she has realized that the Boston area has too many universities - after all, "A university is a university is a university" - and so on - and Bostonians cheered (a few, very few jeered)

  • StillAnOptimist

    If only they would commit suicide quickly - and we can all prosper without their insanity. CA, NY, MA, IL, CT .... DemocraThug cesspools staring into disasters

  • Matthew Slyfield

    "Regulators generally are operating from a theory that says there is some sort of failure in the market"

    If you ask me, I think most of them are operating from a theory that says the existence of a market is a failure.

  • Bob_Robert

    "Almost"?

    A regulator can do only one of two things: Force me to buy what I do not want; Prevent me from buying what I do want.

    A consumer advocate, in comparison, seeks out and exposes fraud.

  • cc

    Regulators also stop or try to stop progress. Even the early industrial revolution in England was heavily opposed by gov regs. It is likely that the revolution happened only because the government was too incompetent and slow to figure out what was going on. There are better side mirrors for cars (like a fish eye) but the safety regulations mandate a fixed type of mirror that prohibits that. The FAA wants to stop drones. Of course the example you cite is probably about protecting vested interests (probably friends of the commission).

  • Politicians like that are only the result of an infantilized American people who really are now looking to politicians to protect them from too many pizza joints.

    Else Americans would grow up and ditch such governance.

  • Stan Erickson

    I long to read an article that shows the intelligent points of view of two sides of a dispute. All I ever see is "the smart guys vs. the fools". Perhaps take it as a challenge to write up how a thinker on the opposite side would justify the city council's (or any opposition's) point of view, whether or not you have a quote from one of their proponents providing it.