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Gus Van Horn blog

Reblogged:(Rent-)Seeking a Way to a "Social Credit" System?

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David Harsanyi raises some good arguments to the effect that the Zuckerberg hearings are a case against regulating Facebook:

jaywalkers.jpg
"Once untrustworthy, always restricted," as they put it of individuals in China. We once said that of government here. (Image via Wikipedia.)
[T]he rent-seeking Facebook desires more regulation. For one, it would make the state partially responsible for many of the company's problems -- meting out "fairness," writing its user agreements, and policing speech -- but more importantly for Zuckerberg, it would add regulatory costs that Facebook could afford but upstart competition almost certainly could not.

It's a long-standing myth that corporate giants are averse to "regulations," or that those regulations always help consumers. We've already seen the hyper-regulation of health care "markets" create monopolies and undermine choice. We've seen the hyper-regulation of the banking industry inhibit competition and innovation.

Politicians, often both ignorant of specifics and ideologically pliable, tend to fall sway to the largest companies, which end up dictating their own regulatory schedules. I mean, Sen. Lindsey Graham, R-S.C., actually asked a compliant Zuckerberg to submit a list of government interferences he might embrace.
None of this is good, but I part ways with Harsanyi at two points: First, I regard any government role other than protection of individual rights to be improper, which rules out even the light regulation Harsanyi allows for. And second, he opens with the observation that many politicians aren't technologically savvy. This may be true, but it wouldn't make regulation okay if they were. Having said that, Harsanyi is correct that the solution to any problem with Facebook (which he rightly observes can't make anyone join or share data) is "to let Facebook fix itself or go the way of Myspace."

Those last two points, combined with the obvious opportunity rent-seeking represents to cronies, become quite obvious when we look across the Pacific to China, which is imposing a "social credit system."  The government will use that to dole out penalties like restricting access to public transport on the basis of such behavior as jaywalking, gaming more than some official might like, or online shopping habits deemed bad by the regime. At least it's obvious to me that allowing people to abuse government force is bad enough without supplying a continuous stream of convenient excuses for them to appear justified in doing so. Unfortunately, it may not be so obvious, for example, to members of the Sun, who call China's system creepy, but don't bat an eye at the idea of the Leviathan state regulating "big" media companies.

-- CAV

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