Aaron Sprouse, libertarian and Austrian economists analyses not only the negative impact of regulation on small business, but the economy as a whole. He offers libertarian non interventionist free market solutions to our regulatory woes.
All human beings are born free, every man and woman; even those in totalitarian states. Their fundamental human rights have simply been removed by a government with too-much authority. The people are still born with the natural right to life and liberty; for they are the rightful sole owners of themselves. As human beings we are born with the drive to attain not only the basic essentials, but to also improve our lives with a higher standard of living. This being inherently true, man in pure right, has the ability to obtain goods through purchase, production, sell and trade. In self ownership the entirety of the human race should always have these abilities. We are born with the freedom to live life however we see fit, so long as no one else is being forced or restricted(no aggression, no force.) Any central government, agency or entity thereof that restricts these fundamental freedoms in any way has become an aggressor against it's own people. This type of governance is tyrannical. Any state to make a proclamation that it recognizes and upholds individual liberty can not contain and will never exhibit such authoritarianism, lest it becomes a state of contradiction and tyranny. In order to achieve liberty, to be truly free whilst having a central government, we must have the ability to live life freely, in our own way; so long as we are not stopping someone else from doing the same thing. There should be no government intervention in personal or social decisions, interactions or actions, so long as these decisions and actions do not impose force or coerce anyone. For state to regulate or to restrict the peaceful personal interactions of the individuals within said state is nothing more than a totalitarian breach of the proclaimed liberty that it claims to uphold. In a true free society these same principles of liberty and non intervention of the state must also be applied economically or the state is still using force or coercion against it's people. No central government should interfere with a man's business, so long as he is not violating anyone's liberty, stealing or using aggression against someone. This is his means of income, and through his means, consumer demand is met. For government to impede, makes the government an aggressor. Governmental regulations imposed on business usually has detrimental effects, not only upon the applicable industry, but the economy as a whole; with small business being the bearer of the heaviest regulatory burden. According to the office of information and regulatory affairs, there are around 3,400 federal regulations on business. with nearly 1/3 impacting small business directly. State forced licensing, fees, taxation, and location regulations are all non consensual aggressions that decreases a nations industrious value. Regulation that forces a business to add additional features, materials, and dictates procedural and manufacturing changes also directly forces an increase in manufacturing cost; which leads to an increase in product price. This decreases overall output and total gross production of that business and industry. Regulatory statutes far too often limit a businesses ability to compete within their market, they stifle market expansion, discourage business innovation, and industrial crossover. According to a 2014 article from the wall street journal, titled "Behind the Productivity Plunge: Fewer Startups," Due to over regulation, The United States production growth rate was nearly half of its historical rate. It plummeted from its annual average rate of 2.5 percent, which was held from 1948 to a low 1.1 percent between 2011 to 2014. This drop off was huge and is just one of the thousands of regulatory imposed hardships forcefully placed upon businesses. People who have great, innovative entrepreneurial ideas are set up for failure because of these regulations. They are forcefully restricted by licensing, fees, and requirements that the majority of these great minds simply cannot meet; and their ideas never becomes anything more than an idea, no matter how revolutionary. During that span of production rate decimation the gross domestic product declined severely which lead to the annual hourly productivity rate to 3.5%. This was the worst productivity statistic seen in a 24 year span, from 1990 to 2014. According to scholars at George mason university; we have clear data that shows when regulation is doubled in an industry there is a 9 percent decrease in the formation of new businesses. This doesn't just hurt those that wish to become businessman, it also has a negative impact on job seekers.Through the same analysis we find that doubling regulation in an industry also leads to a 5 percent decrease in new hires. You can read the article at https://www.mercatus.org/publication/regulating-away-competition-effect-regulation-entrepreneurship-and-employment / Numerous studies have provided strikingly similar data, making it reasonable to assert that it is the nature of regulation to restrict. Gegulatory increase slows down economic growth. Fiscal regulation in essence is nothing more than a thinly veiled tax on individuals. For example, if a government imposed a regulation on beverage companies to use a higher grade metal for their canned products, then cans become more expensive, just as if the government imposed a new tax on canned beverages. We must have entrepreneurial spirit driven free markets, void of government regulation. This ensures competition, lower prices and more jobs. If I as an individual wish to start a business, I should be free to do so without paying a large portion of my profits in taxes. I should be able to operate without unnecessary licencing and production mandates. I should be free of regulations and fees that harm my business and that of my competitors. Americans, in order to remain free and maintain liberty we must have a system of pure capitalism without cronyism or outside market manipulation. Our American markets should be based upon competition and competent service. In a free-market economy the consumer truly directs the markets. Product pricing, demand, and supply levels will be a real reflection of consumer interest. Only when this is achieved can we see an accurate depiction of our economic strength, or lack thereof. In a true free-market economy, we would have to maintain a zero percent corporate tax rate. Businesses would not only stay in America but several companies would move to America; further stimulating the economy. A state does not need this (tax) money to survive and taking money that an individual or company has earned without their consent is illegal, for it is nothing more than thievery. Where true freedom abides, self efficiency and liberty is always the result. This is the only way true capitalism can benefit everyone, non-interventionist economics. Yes, this also applies to wages. The compensation for an individual's Labor belongs solely to the individual that earned said compensation. The production, which is the end result of the labourers productivity is owned by the employer. Imagine that I am a worker in a factory and my productivity value is $10.00 an hour, and I am paid a wage of $8.00 an hour for my work. This is fair; as it allows my employer to profit +$2.00 an hour and relative to my productivity. If a state imposes regulations that force my employer to pay me $15.00 hourly, the wage may increase, but my hourly productivity does not. My employer is now -$5.00 on my hourly productivity rate. This wage is unjust as it is government forcing financial loss to the business owners. They are committing tyranny and have become aggressors against anyone who wishes to pursus the American dream. The wage is not a reflection of my actual production value, and falsely reports financial output value. Therefore such imposed laws, are an act of force, an aggression committed by the government. These types of regulations force unemployment to rise, productivity to be lowered and output to be muffled. Someone will lose their job, and will have a hard time finding another one, unless they can achieve a where their hourly productivity rate is higher than the imposed wage regulation. More people will fight for said job, less people will receive jobs with these high wages. People with lower productivity rates will be fired, the businesses will have no incentive to employ or retain said workers. Any machinery that can replace a worker, will, for it receives no compensation, requires no breaks and always meets output criteria. If we had no regulations, wouldn't breweries put poison in beer and kill people? Of course not, not if they wanted to succeed at business. People would instead buy their beer from a different brewer, and the murderous company, would fail. This can happen under our current over-regulated economy. The difference now is that there would be no government bailouts or substation, ensuring that the breweries would be driven to produce quality products, for the consumer regulates the markets; with their purchasing power. Still not satisfied? What about the FDA? We need a government reulated agency like the FDA making sure we are getting safe products, right; well no. Many times the FDA stops life saving medicines from hitting the markets and they approve medicines which have devastating physical and mental effects. They promote addiction and ensure that no one has the authority to stop "Big pharma." If consumers want quality approved products, this becomes a market demand, without government interference private firms would then pop up, offering quality control speciality, with their stamp of approval being greater than that of the FDA. Businesses could afford these approval agencies because they too would be open to free market competition. To live in a country where the state claims to uphold liberty, these fundamental personal and economic freedoms must be allowed, and upheld. This is the cornerstone of freedom, voluntary cooperation, entrepreneurship, anarcho capitalism, and limited government. The only way to be truly free, is to have true personal and economic liberty.
Aaron Sprouse at age 22 became the youngest chairman of any political party when the Libertarian Party organized Cherokee County in 2014. He was a published post by age 10 and worked as a regional director for the Johnson campaign in 2016.