The Myth of Self-Regulation

BP's Deepwater Horizon

Author’s Note: This piece is dedicated to the people of his generation who voted for Tea Party candidates yesterday, and who should have known better.

Self-regulation is a myth. Nobody regulates themselves. Individuals do not, and the idea that money-making concerns (corporations) would regulate themselves is absurd. Corporations are in business for the bottom-line: profits. They want to make money.  This should surprise none of us. This is what they do. Nor should we be surprised that they dislike regulation. Regulation costs them a percentage of their profits, as do taxes. Thus, regulation, like taxation, is for them an evil. So are such issues as minimum wage, benefits packages, and other workers rights issues, including, especially, unions.

It was long ago recognized that people form governments in order to protect themselves from themselves and from each other. Governments are a social construct, a social contract existing for the purpose of regulating human communities, enforcing those laws and customs agreed upon by each community. As Thomas Hobbes said in The Leviathan, in the state of nature (that is, one without government) life is “nasty, brutish, and short.” We need government, and we recognize this need. Even for the most anti-government of the Founding Fathers the need for government was a recognized fact. The issue was not whether we should have a government, but how much power that government should have. Government regulation was there at the get-go, written into the Constitution.

To get more stories like this, subscribe to our newsletter The Daily.

The modern conservative opposition to government is nothing but nihilism masquerading as a rights movement. A world in which everyone can do anything they want is a world without government. And without government there is no regulation because, as I said above, people do not regulate themselves. Laws are essential to every community, as are custom and taboos. These are the ways in which communities regulate themselves and limit behavior which is harmful to the whole.

The necessity of a national government was recognized by the Founding Fathers. The Articles of Confederation failed miserably to provide for the newly liberated colonies. A loose confederation of independent states offered no protection to the states individually or collectively; thus the Constitutional Convention and the United States Constitution. The Constitution placed limits on the “excesses of democracy” evident in the politics of the locality, which of course, favored the locality at the expense of the whole.

Corporations are the same. Corporations are not interested in the whole; they are interested in their own good. That is the nature of the beast, and this must be recognized. Corporations want to make profits, and the more profits the better. Corporate resistance to regulation is understandable. Look at what science has revealed about corporate excesses: the dangers of tobacco, the dangers of pesticides and other chemicals, industrial and agricultural. They make people sick; they kill people. A whole new generation of legal commercials asks those affected to come forward to sue the offenders.

Corporations will not voluntarily police themselves. It is not in their best interest to do so. And when in the 60s we began to see science reveal the dangers of unregulated industry (just as the Gilded Age revealed the dangers of unregulated capitalism) we also saw industry push back and attack and manipulate science. We saw these corporations respond to their threatened profits by manufacturing lies, dishonest “scientific” studies that did what they were paid to do: defend the bottom line.

Wall Street

Corporations still behave this way. They will always behave this way. It should be no surprise to anyone that when regulations are loosened or removed that the corporations behave in a destructive and harmful manner. The Great Depression resulted from unregulated capitalism. The Crash of ’08 had the same origins. The first may have caught people by surprise; the second should not have. We saw how dangerous the unregulated oil industry was when the Exxon Valdez destroyed a swathe of coastline; was it any surprise that deregulation resulted in the Deepwater Horizon catastrophe of 2010? It should not have been. We should be surprised that it did not happen before, or more often. Yet corporations (and the Repubicans) continue to insist that regulation is bad for business and that we need to remove regulations which keep the oil companies from increasing their profits.

The human coast is irrelevant. Companies do not care about people; they are not answerable (as a government is) to the people. They are answerable to their board of directors and the mandate of any successful board of directors is to make profit.

Corporations and Republicans argue that the government does not have the right to regulate them. But the government is regulating them to protect the people, and if a government has no right right, and moreover, no obligation to protect the people on whose behalf it was established in the first place, then what rights and obligations do governments have?

It’s an absurd point to argue; there is no argument whatsoever by the Republicans. Governments do have the right to regulate. Governments from the beginning of time have regulated and they will always regulate. And if the day comes that Republicans get their corporate government you can bet your bottom dollar there will still be regulation, but it will be the regulation of private citizens, like the regulation of women’s bodies advocated by Republicans.

These private citizens – you and me – must be aware of the mythic properties of self-regulation. It does not exist, it will never exist. Wall Street will not regulate itself, nor will the oil companies. They will do whatever they can get away with to maximize their profits and we must accept our share of the blame if we let them. Do not be fooled. These companies are not here to make you wealthy; they are here to make themselves wealthy. The money they save they will not pass on to you. They will gild their parachutes, maximize their profits, and pocket the cash. Deregulating them will help no one but them. Wealth does not trickle down, folks. It trickles up. And the proof is there for anyone who cares to look. Corporations do not answer to us, but they must answer to the government, which at its most basic is the voice of the people, and shame on us if we are too weak to embrace the power we collectively possess by way of our government.

As John Dickinson said in The Liberty Song (July 1768), “Then join hand in hand, brave Americans all! By uniting we stand, by dividing we fall!” If we fall to Republican corporatism, we will have only ourselves to blame.

Hrafnkell Haraldsson

Hrafnkell Haraldsson, a social liberal with leanings toward centrist politics has degrees in history and philosophy. His interests include, besides history and philosophy, human rights issues, freedom of choice, religion, and the precarious dichotomy of freedom of speech and intolerance. He brings a slightly different perspective to his writing, being that he is neither a follower of an Abrahamic faith nor an atheist but a polytheist, a modern-day Heathen who follows the customs and traditions of his Norse ancestors. He maintains his own blog, A Heathen’s Day, which deals with Heathen and Pagan matters, and Mos Maiorum Foundation www.mosmaiorum.org, dedicated to ethnic religion. He has also contributed to NewsJunkiePost, GodsOwnParty and Pagan+Politics.