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Comment by tathougies | Hacker News Reader

I mean, government regulations are designed for large companies. By themselves, they act as a moat to protect monopolies and oligopolies. Of course smaller companies need to essentially break the law. Every time we see success only at the cost of breaking laws, we should really start to re-examine our laws instead of continuously blaming those who succeeded. In this case square not only succeeded but literally makes life better / possible for many many people.

If there were regulations in the way that would have prevented them from doing so, we should probably self-reflect a bit and have a sense of shame.

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You make it sound like all regulation is bad. There's surely some unnecessary and bad individual regulations, but overall, I prefer a world where a startup can't have success dumping toxic chemicals into a river.

Regulation can be both beneficial and serve as a barrier to entry that protects the incumbents. In fact, that's probably the common case. It's worth recognizing that there are these two competing interests, that every regulation bears this hidden cost, and that the benefit had better be enough to justify that cost. I think often this is not true. Regulations could often be much less burdensome while still achieving most of the benefits.

The solution to that is in having regulations enforcement gradually eased in.

It is kind of a given that a newcomer to an industry won't be compliant with everything and will need time to build up to full regulatory compliance.

The idea then is for the regulator to work out a compliance roadmap which the regulated commits to, and is audited for compliance with occasionally.

Think of it as a learning experience for small businesses.

We would have to do a much better job at keeping track of people's association through corporation's however, as it would lead to an unintended incentive to just dissolve a company when the regulatory compliance costs heat up, reform a new one, and reset the level of regulatory expectation.

I think most regs were driven by events or behaviors at the time of their creation.

To revert them I'd hope there'd be a compelling case as to why the catalyst that brought the regs into existence no longer applies or will not reappear in the future.

I'm not sure that it's an easy process.

Easy, no. Necessary, yes. Imagine a world where regulations only grow on the whole. How far out do you have to extrapolate that system for it to implode under its own weight? That can happen to nation states too...

> Imagine a world where regulations only grow on the whole.

This is the world in which we currently live.

Right and it leads to several negative externalities, such as high income inequality: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2869155

Is the idea that they are never refactored? I don't know that that's true, we see changes to the regs somewhat often: simplifications, clarifications typically?

Regulations aren't particularly good at preventing large companies or even the government from dumping toxic chemicals into rivers: https://trofire.com/2019/06/28/3m-corporation-admits-to-ille... https://www.cincinnati.com/story/news/2018/02/08/ohio-files-... https://environmentamerica.org/news/ame/206-million-pounds-t... https://freebeacon.com/issues/epa-dumps-one-million-gallons-...

Startups would presumably be as successful as everyone else at dumping and getting away with it, meaning at least a few years of growth.

> but overall, I prefer a world where a startup can't have success dumping toxic chemicals into a river.

Nice strawman, but that's not anything I said.

> You make it sound like all regulation is bad.

No... I made it sound like regulation is bad when it negatively affects a good solution from coming into existence. Stripe does not dump toxic chemicals. Rather, it increases access to credit cards and money transfers to people who were being underserved by big banks. Had you ever had to take CC payments in person before square? They made it much easier.

> government regulations are designed for large companies.

So a publicly traded company with 25B in market cap and member of Russell 1000 index is a 'small company'?

Well, Square was -- in living memory for HN -- a startup. If every company has to skirt regulations in order to gain a 25B market cap to compete with larger players, then we need to re-think what our regulations are. Otherwise, they just serves as validators for oligopolies.

This is called regulatory capture, and is not something to be defended.

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