Safety Regulations are good for Business

[Scheavo]

https://news.yahoo.com/job-killer-try-bottom-line-booster-workplace-safety-180000530.html

Costly safety upgrades, nitpicky government inspection and resulting fines are often blamed as being bad for business. But a new study shows that when government job-safety inspectors make a surprise visit, they actually enable companies to save money and jobs for years to come.

Of 818 companies with more than 10 employees, the 409 that were randomly selected for inspections saved an average of $355,000 over five years in worker injury claims and compensation at each firm, compared with the other 409 similar companies that were not inspected.

If these randomized inspections were rolled out to businesses across the country, the researchers estimate that they would save some $6 billion not to mention the physical and psychological harms of workplace injury and death.

I wonder if the same principles apply to regulations for consumer safety. Safer consumers means less lawsuits, and perhaps more customers.

[Super Dude]

And also environmental regulation, which also includes government inspection and the like.

[Tanatra]

This is only somewhat related, but I was reading about olive oil today and this article seemed relevant enough to share:

https://mamanatural.com/virgin-olive-oil-scam-fraud/

More than two-thirds of common brands of extra-virgin olive oil found in California grocery stores aren’t what they claim to be, according to a University of California at Davis study.

Instead, the oils were spoiled or made from lower quality olives unfit to be labeled “extra virgin.” Worse, some were outright counterfeits, made from soy, hazelnut, and even fish oils mixed with low grade olive-pomace oil.

Peanut oil was an adulterating ingredient used as well. Some people have nut allergies, so consuming these fraudulent oils could be very adverse to their health. Even the olive oil sold under the Whole Foods label is guilty of this!

So what's it gonna be, Libertarians? Is government intervention justified here, or should businesses have the right to commit fraud?

Keep in mind this issue didn't originate in a college study; it started with honest olive oil producers who realized they were being undersold by competitors selling adulterated oil. Government intervention here is actually beneficial to the businesses that aren't trying to rip people off.

[jsem]

So what's it gonna be, Libertarians? Is government intervention justified here, or should businesses have the right to commit fraud?

What? The right to commit fraud? Fraud is like a breach of contract, for which there should be severe penalties.

These government functions are very useful, and no libertarian would want to live without them. We just think that these kinds of functions could be provided by private entities instead of the government. Fraud is serious business.

[Super Dude]

Private entities that can be bribed just as easily as government officials, except they can't be voted out of office.

[Tanatra]

These government functions are very useful, and no libertarian would want to live without them. We just think that these kinds of functions could be provided by private entities instead of the government. Fraud is serious business.

I see. A lot of libertarians fail to make that distinction when discussion government regulations. Thanks for pointing that out.

That's interesting that you say that. I'm also about to order a large quantity of grass-fed beef from an online vendor based in Missouri, and I came across this in their FAQs:

https://www.grasslandbeef.com/Page.bok?file=faqs.html

Are you certified organic? Why not?

All U.S. Wellness Meats pastures and animals have been maintained with organic principles in mind since 2000. Unfortunately, the state of Missouri dropped a state-run organic-certification program and turned it over to a private certifier several years ago. The private certifier wanted 3% of the gross income of the preceding year to maintain the license. We politely said no, and felt if Thomas Jefferson were still alive he would concur. Sadly, greed has infiltrated a noble cause. 50% of the Missouri organic producers have let their certification lapse since this situation was create by the Missouri legislature.

Probably the reason why this place's prices are as good as they are is because they no longer have to account for the costs of the organic certification process. But if people don't know that it's organic, why would they pay more for it? The reason I'm paying more is because it's grass-fed meat, but the benefits of that have yet to enter mainstream knowledge.

[Scheavo]

And private entities are around to make money. Getting bribed is making money. Public regulators are there to, well regulate, and taking a bribe is not directly in their interests. Not to say that public regulators cant' be bribed (they obviously can), but I wouldn't trust a private regulator for much.

Especially considering the current corporate model, where the regulator would probably be owned by the regulatee. Seeing as how the way we currently know who owns what is becuase of income tax returns, it would become very hard to track the corporate influence.

[Super Dude]

And the payoff for a private inspector being bribed is probably much greater than it would be for a government inspector, for both parties concerned. If you were to do a risk-benefit evaluation, I'm sure you'd find most firms would prefer the "payout" option.

[jsem]

Private entities that can be bribed just as easily as government officials, except they can't be voted out of office.

I used to think like this as well. Now, I'm not so sure anymore. Because private entities have to be liable to their customers, or another entity will pop up and take their place. Competition.

[Scheavo]

Private entities that can be bribed just as easily as government officials, except they can't be voted out of office.

I used to think like this as well. Now, I'm not so sure anymore. Because private entities have to be liable to their customers, or another entity will pop up and take their place. Competition.

And when those customers are the people being regulated, as Tanatra already pointed out is the case sometimes?

[bosk1]

Forgive me for automatically being skeptical of articles that begin with "But a new study shows..."  Not that that can't be perfectly valid.  But so often it just smacks of, "People who don't happen to like what all the other studies on the subject have shown paid off some reachers to do a study showing the opposite."

[Scheavo]

Yikes, Bosk. If you read the article, you'll read why this report differs from previous reports:

Studying the economic impact of on businesses can be tricky because most checks target companies that have had violations or complaints, thus skewing the sample. For this study, however, the researchers took advantage of a program started in the 1990s in California’s Division of Occupational Safety and Health Administration (Cal/OSHA), which conducts some of its inspections at random not just at workplaces with recent complaints or accidents. “The randomized inspections provided a perfect natural experiment that uses the power of randomization just like a medical clinical trial,” Michael Toffel, Harvard Business School professor and co-author of the new paper, said in a prepared statement. This sample allowed them to assess the actual impact of inspections on operating costs, credit rating, job retention, company survival and sales, the researchers noted.

I do find it hilariously ironic though, that in a thread about how private regulators could easily be paid off, you rebut that the people who made this study were paid off.

Private entities that can be bribed just as easily as government officials, except they can't be voted out of office.

I used to think like this as well. Now, I'm not so sure anymore. Because private entities have to be liable to their customers, or another entity will pop up and take their place. Competition.

Another problem I realized: if the regulating company was owned by the same company being "regulated," then that regulating company wouldn't need to make a profit. So, if it didn't have many independent people buying it's insurance plan (or however it is that libertarians think this would work), it wouldn't matter, because it's parent company could still so an overall profit from running the company at a loss.

[bosk1]

I do find it hilariously ironic though, that in a thread about how private regulators could easily be paid off, you rebut that the people who made this study were paid off.

I recommend you re-read my post and see what I actually said.

[Scheavo]

Err sorry, I guess I should have said "could" have been paid off, which is what I was thinking anyways. Still doesn't change what I said though. You're skeptical about a study, becuase it could have been paid off.