The big news here in the states is that Congress just passed a 2300-page financial reform bill, the goal being to prevent another financial crisis like the one we just went (are going?) through. Am I hopeful? Not really, but I wish us all luck. Unfortunately lawyers are already poring through the bill looking for loopholes…it’s hard to believe they won’t find them.
In my lastest post at Transforming Stress I mentioned that Virginia sells special license plates to promote and help fund its program against domestic violence:
Some clever fellow ended up spoofing the program by spending $10 extra to personalize his plate:
And the latest issue of Stanford Magazine had another relevant story. It was written by a fellow who attended Stanford in the early 1960’s. He had a wealthy Indian friend whose father had made his fortune importing goods from America. It turns out at that time America was still producing material goods rather than importing them and there was a good market for them in India. The problem was customs duties were extremely high and ate into profits. But there was a law saying if a shipment of goods hadn’t been claimed within 30 days it would be auctioned off to the highest bidder. So the Indian student’s father bought a large number of shoes and shipped the left ones to Bombay. He waited the 30 days and bought them for a song, since no one had any use for left shoes. Then a month later he shipped the right shoes to Calcutta and after 30 more days bought that shipment. He made a bundle by using the law to his advantage.
Do I believe financial firms won’t do the same with this new legislation? Not on your life. But on the bright side, it will help employment by creating more government jobs. 🙂
What do you think?
The ways for lawyers to be evil is endless. Do you mean these endless government jobs will be there to regulate the endless evil lawyers? Explain more.
bikehikebabe,
I’m not sure what there is to explain. The executive branch is already looking for office space for the new regulators that will be needed. How do you think laws are enforced?
When Andrew Jackson was president he wanted to remove all Indians from east of the Mississippi River. The Cherokees didn’t fight the order with guns, they went to the courts…all the way to the Supreme Court. John Marshall agreed with the Cherokees and said it was unconstitutional. In one of the most egregious acts in our history Jackson said (more or less), “Let’s see John Marshall execute that decision.” He had the army forcibly remove the Cherokees to Oklahoma anyway. In general the legislature makes laws, the courts interpret them, and the executive branch enforces them…in theory at least.
I was following the “trail of tears” markers earlier in the spring in my visit to Tennessee and Jackson’s family site. It is a bit hard to see the positives. I will still hope for positives in the current effort to drive the economy into exile!
Looney,
I agree. It breaks my heart to think of the Cherokees and the Trail of Tears. As you no doubt know, more than one in four of them died during the journey.
It’s the problem of the means. Using law this way will always lead to lawyers finding loopholes.
To change behaviour other ways are needed – like altering the incentives. Not sure how to do this, but it is this kind of thing that is needed I think.
It is not my country, but in ours, the best way is to set a thief to catch a thief. Like that smart Indian who imported shoes. Find lawyers who will wind loopholes to draw up the law in the first place. Not lawyers who do not practice but legislate. Indian economy is much larger than official statistics state because around 40% of it is in the cash economy where no books are kept and no taxes are paid. It is called the black economy and exists to avoid the license/permit/inspector raj. I hope that the USA will not end up doing that too!
Evan,
The trouble, of course, is that corporations spend big bucks in campaign funds to make sure the laws are slanted in their favor. All one can do is support watchdog groups to try to keep things down to a dull roar.
Rummuser,
Here in the States smaller businesses are more apt to do things under the table, your black economy. The bigger corporations do the more sophisticated tricks and influence the lawmaking itself.