Why do business people want to operate w/o gov't regs when many can't be trusted to follow the "honor system"?

Question

(This is an ethics and economics Q too but YA doesn't allow for multiple categorization of Q's despite repeated suggestions and common sense!)

Answer 1

Business people want to operate w/o gov't regs because the gov't will stop them from taking advantage of situations when they can. Most of the business people that do 'what is right' and follow the 'honor system' don't mind most of the gov't regs and prefer that the gov't have laws that protect free enterprise and free competition.

Answer 2

Gov't regs have historically caused more damage than good. Case in point:

The gas price controls of the 70's caused sellers to just not sell

1.6 gallon toilets, caused people to flush twice using 3.2 gallons instead

Answer 3

Many times these regulations just complicate things. It is important to have some of them. Safety for an example is a good reg, however they are written so complicated and rarely enforced.  

Answer 4

The core reason is cultural: Business feels it can manage their own affairs better than government. And, overall, I'd say they're right. (Would you rather eat at a government-run cafeteria, or a privately-owned restaurant? Government housing, or private?)

However, obviously there must be some watchdog who is not financially attached to the business to enforce certain issues, such as fair labor practice and waste disposal, because business tends to be short-term-focused (due to the pressures of quarterly stock reports). Government has to fill this role.

Where it gets silly is, for example, under the Bush administration, much of the EPA and FAA have been gutted to fund other projects, such as the war in Iraq. Then when these agencies drop the ball, they get criticized as an example of how gov't oversight doesn't work. Like any business, gov't agencies have to be well-funded and managed consistently to be effective, so these are false arguments against gov't oversight.

Answer 5

There is no need for regulation, which restricts everyone. We have a court system to punish the few that commit crimes. Why punish and hurt everyone because of the misdeeds of a few?