The Essence of Regulation

The Miller’s Organic Farm Case: Part 2

[Editor’s Note: Read Part 1 here.]

The laissez faire position on government regulation is that by overriding the judgment of individuals about production, trade, purchases, professional practice—virtually any and every facet of economic life—regulation violates the right to liberty and property. Because the individual’s judgments, choices, and actions—and the value he obtains thereby–equate with the process of living, regulation in the end violates our right to life.

Regulation substitutes the judgment of government, imposed by threat of fines and imprisonment, for that of individuals. It overrides the judgment of those directly involved in and responsible for every phase of economic life (and many other areas, of course), substituting government bureaucracy.

Translated into practice that means curtailment of invention, imagination, experimentation, innovation, initiative, and value preferences. Most regulation is imposed on the grounds of protecting us. But the most powerful incentive for business to offer consumers safety, quality, convenience, fair treatment, and honesty is the profit motive—as all of us know when we must sell what produce or buy what we need.

Among the worst effects of regulation, as Alan Greenspan argued in “The Assault on Integrity,” is that it pretends to guarantee all those things—ensuring us government is taking care of us–and so lessens the competitive edge that companies can achieve by earning a reputation for safety, quality, cleanliness, integrity, and much more. Consumers come to assume all companies provide those protections only because regulations require it. Consequently, companies have an economic incentive to do no more than comply with the minimum requirements of regulations. This regulation tends to achieve the lowest common denominator: uniform compliance with regulations.

What good will this argument do Amos Miller? It is an argument in principle against regulation. If Miller’s case involved “fringe regulations”—the latest bright idea for extending government control—those regulations might be rolled back.

Unfortunately, regulations had their birth in America in the realm of food safety and purity. Amos Miller’s concept of how to produce the highest quality food flies in the face of the entire regime of regulation. He cannot be treated as an exception because he is stands against regulation in principle.

An August 11, 2022, report said federal attorneys want Amos Miller jailed for failing to pay $105,065 in fines and court costs… “The United States submits that Mr. Miller’s continuing recalcitrance and flouting of the court’s orders requires…him to be incarcerated…”

And so, to return to the beginning of this article: What is the point of describing a problem that cannot be remedied? The only answer I see is that the case of Amos Miller drives us back to consideration of the fundamental clash of liberty with regulation–a clash in principle. And back to what is at stake for human productivity.

William L. Anderson, writing for the Mises Institute, traces the origins and growth of regulation, especially during the Progressive Era in the United States, and rightly concludes:

Yes, there is an alternative to regulation, one completely consistent with freedom. Any business can be sued for harm caused by its products, services, financial dealings, fraudulent claims, and misrepresentations—to take but a few examples.

(Necessary note: Today, traditional liability law has been captured and corrupted by lawyers chasing huge “contingency fees,” often 30 or 40 percent of a settlement, which they collect if they win a case. That does not negate liability law; it is an abuse, a separate problem with separate solutions for another discussion.)

Common law in fields such as liability and negligence operates on the same principle as criminal law. A person is free to act without intervention of the authorities until charged with a violation of the law—in other words, a violation of another’s rights. If the alleged violation involves (broadly speaking) some variant on fraud, the recourse is to civil law with due process and other protections.

The fundamental distinction between regulation and remedy at common law is the crucial distinction between preventive law and remedial law. No evidence has been adduced and no one has charged that Amos Miller has harmed anyone—quite the contrary. But regulations have made him a criminal facing ruinous fines and jail.

Walter Donway is an author and writer with more than a dozen books available on Amazon and an editor of the e-zine Savvy Street. He was program officer or director at two leading New York City foundations in the healthcare field: The Commonwealth Fund and the Dana Foundation. He has published almost two dozen articles in the Blockchain Healthcare Review.