Source: https://iep.unibocconi.eu/europes-internal-tariffs-why-imfs-...
How do you estimate the cost of regulations on businesses? You ask businesses. Businesses have absolutely zero incentive to say that regulations are not bad. "Just in case", they will say it hurts them.
That is, until there is a de facto monopoly and they can't compete anymore, and at that point they start lobbying like crazy for... more regulations. Look at the drone industry: a chinese company, DJI, is light-years ahead of everybody else. What have US drone companies been doing in the last 5+ years? Begging for regulations.
All that to say, it is pretty clear that no regulations is bad, and infinitely many regulations is bad. Now what's extremely difficult is to know what amount of regulation is good. And even that is simplistic: it's not about an amount of regulation, it depends on each one. The cookie hell is not a problem of regulations, it's a problem of businesses being arseholes. They know it sucks, they know they don't do anything with those cookies, but they still decide that their website will start with a goddamn cookie popup because... well because the sum of all those good humans working in those businesses results in businesses that are, themselves, big arseholes.
Your overall point is solid, but I'd like to what I think is another reason that businesses could desire regulation. You're right that a dominant business can use its political power to "regulatory capture" its market and prevent new entrants, but I believe this isn't limited to uncompetitive markets.
Regulation can also prevent "arms races" by acting like explicit collusion. A straightforward example is competitive advertising in a saturated market, like cigarettes. Under the rough assumption that cigarettes are all equivalent and most potential smokers already smoke, then competitve advertising cuts into the profit margin, and companies have to participate or lose out. If you ban advertising then it's as if the bosses all got together and agreed not to compete like that. See e.g. https://pubmed.ncbi.nlm.nih.gov/31547234/
Shame we can’t regulate the quality of regulations.
That's an executive order (regulation) requiring proposed regulations undergo a cost-benefit analysis before being promulgated.
It's why we got mandated backup cameras in cars: the cost-benefit analysis revealed the cost to have these in every new car was dwarfed by the cost in human lives of all the kids who were being run over in driveways bc they weren't visible behind cars.
I was somewhat disappointed, however, to aee that this applies only to "major rules" from "executive agencies" and as such doesn't seem to apply to an executive order. There would have been some recursive satisfaction to see EO12291 itself tested by its own standard.
Per https://iep.unibocconi.eu/europes-internal-tariffs-why-imfs-..., the model treats shopping local as evidence of the existence of a trade barrier, as opposed to a rational preference based on cultural and environmental considerations. This is why the numbers are ridiculously high. (Is there a 120% implicit tariff for textiles? Or do people just prefer warm clothes in the north and breezy clothes in the Mediterranean?)
There's no reason to expect the warm clothes to be made in the north and the cool clothes to be made in the south.
European people also still have a much stronger national identity than a European identity, especially compared to the US with state vs. country level.
The translation infrastructure is huge, and reasonable-quality machine translation⁰ has been freely available for years now.
I don't mean to refute your experience, but I am suprised by the claim, because it's really not what I've seen here. Could you give some more detail on what you mean.
⁰ EU procedure means there are some notable absences in the list, but it's pretty comprehensive once you include citizens' second languages. See https://european-union.europa.eu/principles-countries-histor...
All of this is correct, and that's why the single market for goods (except for booze and tobacco) has been such a massive success. However, lots of growth (particularly in the US) comes from services, and for this, languages matter a lot more.
Sure, lots of continental Europeans speak multiple languages, but the vast discrepancies in languages and regulations (insolvency, capital markets etc) means that there are dis-economies of scale in the EU. Like, there's a reason that companies start selling in their home market and then move directly to the US.
A common language can't be assumed across the EU, while other large blocs (China, US) can make this assumption which is important for services trades in particular, as well as bespoke goods trade.
(This despite Ireland and Malta having it as an official language, and the Nordics often having better English skills than natives.)
Come to Ireland, we have Guinness!
And that is just one of many new regulations.
coats have gotten higher, but across the board for different countries
If an unethical business gets started due to underregulation and it generates revenue and contributes to GDP, is that a good thing?
There are some "mosquito" businesses that imho provide no net value and we'd be better off if they didn't exist (c.f. Bastiat's window breaker⁰). For example; payday loans, gadget insurance, MLMs, f2p games. The trouble is that there is an apparent need they're meeting, and nobody wants to "destroy jobs" or even worry too hard about exploiting the vulnerable.
Even if I were emperor and believed hese businesses were unjustifiably bad, I'd be worried about the authoritarian consequences of shutting down the less egregious ones. I'd also hope to have the humility to entertain the idea that I don't understand their full benefits.
In conclusion I think it's bad to have unethical businesses, and that even if they make the indicator go up, they are probably a net negative on the economy and society. However, I don't know what's to be done about it.
⁰ https://en.wikipedia.org/wiki/Parable_of_the_broken_window
(Coda: You might say that's impossible, and local loan sharks will spring up to meet the need. That's probably true, but at least those guys merely break your legs, rather than advertising incessantly on daytime tv.)
Deregulated gambling has had a horrible impact on individuals. Repealing Glass—Steagall led to a global financial crisis. Gig economy businesses are exploiting workers by the thousands through self employment loopholes. We have insane monopolistic pricing and practices in the US in eg the telecom industry. Worst of all is that we’ve likely doomed the entire planet based on what is effectively too little environmental regulation.
Yes, but gambling and all vices for that matter, are a centuries old issue that's well studied and well understood by everyone, while AI(hate that term in this case) LLMs are only an issue since November 2022, while most influential politicians are dumbass boomers who don't understand how a PC or the internet works let alone how LLMs work but yet are expected to make critical decisions on these topics.
So then it's safe to assume that the politicians will either fudge up the regulations due to sheer cluelessness, or they will just make decisions based on what their most influential corporate lobbyists will tell them. Either way it's bad.
Let's not be overly pedantic and overly Pius on petty semantics like that. It was clear from my original comment, the context of what I was talking about.
E.g. "if a decision cannot be explained by a human, it should bot be done by a machine" applies to them, too.
Basically, if you read the EU AI Act for example, it's hard to find anything you'd disagree with regardless of whether it's about ML, LLMs or three if statements in a trench coat.
Of course the industry is up in arms about it (just like GDPR)
Actually, around here they are giving a second chance to people whom over-regulation of the work market made too expensive to hire.
> insane monopolistic pricing and practices in the US in eg the telecom industry
It's actually regulations deterring competition in telecom who are responsible to those practices.
It goes like this: (well intended) regulation => raise price of doing business => fewer startups => less competition => incumbents enjoying practically monopoly => incumbents behaving like monopolistic a-holes.
> too little environmental regulation
In China. You forgot "in China". That is where most of that planet dooming is happening. Good luck promoting environmental regulation there.
Over-regulation being what, minimum wages? Coverage for basic social safety nets? ‘Cause that’s what we lost.
> It goes like this: (well intended) regulation => raise price of doing business => fewer startups => less competition => incumbents enjoying practically monopoly => incumbents behaving like monopolistic a-holes.
Bell system was broken up into seven different companies, thanks to regulation. It’s _lack_ of regulation that let telecoms merge together into behemoths. There _are_ small ISPs and telecoms in the US, they just can’t compete due to the size differential.
> In China. You forgot "in China". … Good luck promoting environmental regulation there.
Right, let’s jump for a Tu Quoque. China is destroying the planet so who cares what we do ¯\_(ツ)_/¯
I’m not blind to the existence of plain bad regulation, regulatory barriers and capture — but the overwhelming majority of these arguments have just been used to make regular people’s lives’ worse.
“Cheap housing isn’t being built in the UK because regulation makes it more expensive!” -> remove regulations -> there’s still no cheap housing but anything from 1990s onwards is now also badly built.
As a construction developer I’m sure I’d say there’s still too much regulation though. Gotta bump those margins.
One easy example is regulation making it hard to fire people. Then, naturally, firms will hire just as hard. The tradeoff is thus between a healthy, fast, dynamic and competitive job market with plenty of opportunities but with job insecurity and - fewer jobs, smaller salaries but the lazy unproductive bum slowing everybody down is now impossible to get rid of.
Yes, minimum wage is another. In effect it makes people whose work is worth less than the minimum wage - legally unemployable.
> Bell system
Bell system was a monopoly thanks to government regulation in the first place. The government actually passed a law that made illegal to connect a 3rd party telephone to Bell's network!
Yes, you need more regulation when your regulation f'd up a market. In free markets competition keeps market participants honest and even breaks monopolies. This is why one of the first regulation incumbents lobby for is meant to deter competition.
> Cheap housing isn’t being built in the UK
I do not live in the UK, but I am willing to bet everything that there is still a ton of regulation stopping building there. Last summer I visited London during a heat wave. We were sweating in our AirBnB, complained to the owner but he answered that he couldn't install an A/C because he wasn't allowed to change the building facade...
Privacy is in a different category altogether, but there's more to think about than just how much things cost companies.
Maybe I should have used dumping waste in a river and paying workers below minimum wage as examples. Profits could go up, but most people would agree it should still be illegal.
Normally I'm against overrgulation, but when it comes to privacy more fine for big corp is need if ANY violation is found. Rather NOT have AI than compromise on privacy.
Our ancestors survived perfectly fine with telephone directories dropped at every house for free which contained everyone's name and address.
Are you sure someone knowing your address is that bad?
It's bo longer just "your home address".
Yeah but our ancestors also doesn't amount of processing power that the current big corps have. Constrain what big corp can collect personal data is beneficial for average users in current day and age.
Most of us actually don't mind losing a little privacy to read a news article when faced with the alternative of paying money or that news website ceasing to exist at all.
But, hey, keep pushing your warped privacy sense onto all of us, I am sure you are right.
BTW, when presented with clear non-dark-pattern choice 96% of people opt-out of "losing a little privacy": https://arstechnica.com/gadgets/2021/05/96-of-us-users-opt-o...
There is no universal measure for that, only each individual can answer the question for herself. GDPR is robbing people of that chance though.
> Is this a small amount
For me, yes. I already have a device in my pocket reporting my exact location to a private company at all times and I accepted that a long time ago.
> 96% of people opt-out
I bet they would chose very differently when the alternative is to pay or stop using the product. Just look how many people use privacy-destroying fidelity cards in supermarkets for some measly discounts.
How exactly? GDPR is quite literally "you can ask people for their consent to give you their data".
> I already have a device in my pocket reporting my exact location to a private company at all times and I accepted that a long time ago.
There's a difference between "one company" and "thousands of companies". And yes, there's an expectation that the company doesn't sell that location data which even in the US results in lawsuits: https://www.reuters.com/legal/litigation/us-court-upholds-ve...
> I bet they would chose very differently when the alternative is to pay or stop using the product.
False dichotomy. You don't need 24/7 suveilance to show ads or monetise products.
Patently untrue. Under GDPR you are not allowed to withhold your services from users refusing to give you "their" data. Their opt-out costs them nothing.
This is what you pretend to care about: "There is no universal measure for [what small amount of privacy constitutes], only each individual can answer the question for herself."
What you actually want (and what is actually happens): "users are not given no privacy whatsoever and every single scrap o user data has to siphoned off and sold to the highest bidder, and the false alternative should be for users to pay to preserve their privacy". That is basically what Facebook is arguing.
So. First you define what "small amount of privacy" is, and put a price on that. And then present users with a choice. Or skip the pretence.
It would be much cheaper and pro-business to let them collect everything and secure nothing.
What have we gained by framing it as such other than an extremely biased take pro unregulated business?
Yeah, regulation generally tries to do good but that is going to be little consolation when EU's economy will go broke because all products and services we consume are build in less-regulated territories (USA and China to be specific).
Oh no. How are you going to build your new ChatGPT wrapper without selling user data to thousands of "privacy-preserving partners"?
GDPR (and a very small number of other applicable regulations) are somewhere between place 1000 and 1500 of things that hinder startups. And unless you are a complete moron those regulations will maybe apply to you when you reach 10 million+ users.
No. GDPR was presented as a company ending regulation. You make a mistake - you are doomed. The fines are in revenue percentages. User data was said to be "toxic". You touch it, you better know what you are doing or else.
This kind of regulation has a strong chilling effect on the budding founder. Countless web-startups were never created because the most common monetization model (ads) became basically illegal (for European startups only, US/Chinese competitors kept enjoying full freedom).
> and a very small number of other applicable regulations
But it's not a small number. And regulations have a cumulative effect. See, startups are like distance running. You know it's a hard thing, but you believe you can try to do it. But then regulations are like potholes. You run around a few, but the more potholes to avoid the harder the run, until your main job turns from running to avoiding potholes. Then you simply say "why bother" and give up.
The more regulations you have, the more obstacles you put in front of startups, the fewer young people choose the entrepreneur path and decide to just get some bureaucratic job instead.
This is the tragedy we are living in the EU right now, in the clapping of bureaucrats who never build a product or service in their entire life and do not understand what those damn entrepreneurs are complaining about.
Bullshit
> You make a mistake - you are doomed. The fines are in revenue percentages.
Tell me you didn't even read a line of GDPR in the past 9 years or know anything about European regulations without telling me
> This kind of regulation has a strong chilling effect on the budding founder.
A moron who gets their advice from ads industry, sensationalist headlines and HN? Perhaps.
> But it's not a small number.
It is.
> The more regulations you have, the more obstacles you put in front of startups
GDPR is not an obstacle. It quite literally is "do not scrape user data and sell it to third parties without user consent".
> in the clapping of bureaucrats who never build a product or service in their entire life and do not understand what those damn entrepreneurs are complaining about.
Yeah, "entrepreneurs" complain about a lot, and then make a surprised pikachu face when they are told in no uncertain terms that no, sending precise geolocation data to third parties to store for 12 years is not okay: https://x.com/dmitriid/status/1817122117093056541
As a matter of fact, I am the founder&owner of a small ISV (nothing ad, privacy, crypto or AI-related) in the Eastern EU. Everything I am telling about European regulations comes from dozens of years of direct, painful, personal experience.
How about you?
> Everything I am telling about European regulations comes from dozens of years of direct, painful, personal experience.
Strange that you then spew absolute bullshit about GDPR.
> How about you?
I've worked in large multinational corporations (banking, streaming) that were "hit" with GDPR and spent several years making sure they are compliant. Not because GDPR is bad, but because no one really cared about the data collected, and where it ended up. [1]
Startups had it and have it easy since they can just not siphon all the data. Especially now, when you have all the tools to handle data properly. Hell, a decade ago you couldn't even get privacy-preserving analytics. Now you're drowning in them.
We're also preparing to launch a few (admittedly small scale) projects with friends, and what do you know? GDPR is the absolute last thing that even bothers us. You know why? We know what data to collect and for how long to store it, and we're not sending that data to thousands of "privacy-preserving partners".
"Company-destroying fines" boogeyman or whatever other "chilling effect" bullshit belongs in the mind of children and morons. Hell, I've seen banking regulators come, list issues, and give a deadline to fix them. Much less GDPR.
[1] That's not entirely true. Payment and payment-adjacent regulations are significantly more stringent than GDPR, so everything related to that was and is extremely serious. As anything related to things like "data of persons under state protection". It's never black and white.
However, in big companies, especially at the time, you would eventually end up with a lot of data duplicated across many systems, often barely connected. 10 years ago cleaning up that mess required companies to reverse engineer and document 10-15 years of bad/hasty/adhoc decisions and assumptions. Surprisingly often that resulted in just retiring certain internal microservices wholesale (they just were no longer needed) and/or significantly reducing bandwidth and storage requirements in certain cases (because you no longer cary and store heavy duplicate objects around).
So the main opposition to GDPR came not from "poor chilled startups", but from companies like Facebook and Google who rely on 24/7 surveillance exclusively, ad industry, and large corporations who didn't want to deal with cleaning up internal messes.