Pethokoukis, Economics, Regulation

Why did we get 140 characters rather than flying cars? Maybe it was $40 trillion in regulations

Credit: Bladerunner

Credit: Bladerunner

“We wanted flying cars, instead we got 140 characters” is the pithy and tweetable way the Founders Fund, a San Francisco-based venture capital firm, asks the question, “What happened to the future?”

How did it get away from us? Maybe we regulated away the sci-fi future that our never-happened tiger years would have brought us. A 2013 study from economists John Dawson of Appalachian State University and John Seater of North Carolina State University, Federal Regulation and Aggregate Economic Growth, estimates that the past 50 years of federal regulations have reduced real GDP by roughly two percentage points a year, or nearly $40 trillion.

Instead of the US economy growing by just over 3% a year since World War Two, it would have grown by over 5% a year. “That is, GDP at the end of 2011 would have been $53.9 trillion instead of $15.1 trillion if regulation had remained at its 1949 level,” the authors conclude. (And by the way, the study does not attempt to quantify the costs of the Affordable Care Act or Dodd-Frank financial regulation.)

Imagine a US economy four times as big — four times as wealthy — as the one today. Basically, we would have the US economy of 2080 right now. Instead of regulation to reduce air and water pollution, maybe nanobots would be doing the job for us. And maybe we would have flying cars, such as the one depicted cruising above 2019 Los Angeles in the film Bladerunner (top photo)..

If Dawson and Seater are correct, the cumulative impact of decades of post-New Deal regulation is also why US productivity growth and innovation downshifted in the 1970s, a phenomenon still a topic of much debate among academic economists. Indeed, an important channel for regulation impact is decreased innovation, rather than just compliance costs.

But are these numbers even remotely plausible? Dawson and Seater concede that a) “they are aware of no theory that addresses the effects that regulation has on the macroeconomy” and b) “estimates of the output losses induced by regulation may elicit ‘sticker shock’ on the part of the reader.” (Welcome to the miracle of compounding.)

So the duo are breaking some new ground with their model, and I am eager to hear what other economists say about their findings. But the authors do point to a previous study of differing country growth rates from 1950 through 1998 that argues most of the differences between the high and low growth rates were the result of “barriers to riches” from various forms of regulation. At the very least, this study should remind us that there are costs, perhaps immense ones, as well as benefits to regulation.

30 thoughts on “Why did we get 140 characters rather than flying cars? Maybe it was $40 trillion in regulations

  1. Honestly, maybe it’s just my experiences with Boston drivers, but I’d probably rather take the handy, delightful communications technology than the massively increased opportunities for death from above.

    • No, you want more regulation, like Doddering Frankenstein and Obamascare, Toad.

      Nice job, imbecile, you killed the country.

      Dumbass.

      • I am flattered by your notion of how powerful I am, Mesa Econolube. Truth be told, if I want Medicare to negotiate directly with Big Pharma, and Big Pharma want Medicare Part D as a prophylactic, so to speak, we get Part D.

        • Truth be told, you’re a sniveling, ignorant asshole, Toad.

          Credit where it’s due, Toad, you and your stunted ideological brethren have destroyed the economy, and healthcare, so now you can lay claim to near total decimation of this country.

          You’d rather be “negotiating” with government solely for your medical care needs, since that is the least efficient means of delivery.

          When a little government causes a large problem, Toad’s solution is a lot more government, because who wants large problems, when you can have catastrophe?

          • Can’t sell a car on Sunday in Michigan?
            ^&*%T$ Obama
            Can’t publish a recipe using stevia without GD Searle (nutrasweet) siccing the FDA on you?
            ^&*%T$ Obama
            No interstate banking in Ill until Continental Ill cratered?
            ^&*%T$ Obama
            Can’t buy antibiotics over the counter as in Europe?
            ^&*%T$ Obama
            With its patent on oxycontin expiring, Purdue Pharmaceuticals successfully petitions the FDA to declare it unsafe, maintaining its monopoly on an abuse resistant formulation.
            ^&*%T$ Obama
            Uber car service’s slick phone app faces stiff regulatory pressure — from the taxi industry.
            ^&*%T$ Obama

          • I see you’re drinking heavily again.

            Well done, Toad.

            It’s slightly difficult to tell the uptick from your regular baseline incoherence, but it’s there.

            Correct, Obama caused most of his own problems, and is making many, many others worse.

            If you ever emerge from your stupor (extremely unlikely), you may actually begin to notice what we normal people call “cause and effect.”

            The likelihood of that happening is infinitesimal.

          • hahaha. You’re a scream Mesa. Cause and effect. hahaha.
            Q. Why did the chicken cross the road?
            A. On the wingnut right, we don’t ask questions like that. We believe the chicken crossed the road and that is good enough for us.

          • HAHAHAHAHAHAHAHA you’re a flaming jackoff Toad.

            Wrong, it’s

            Why did the chicken cross the road?

            Because government mandates (fairness doctrine) required greater chicken representation on the other side of the road. And it didn’t have to, because a (leftist-backed) light rail system was constructed at enormous taxpayer expense to carry that chicken.

            Can’t even get your own shitty jokes right.

            Jesus you’re a fucking moron Toad.

          • What? The chicken isn’t theoretical?

            So the softball players took the field at the economist’s convention. The pitcher called out, “Assume my first pitch is high and inside for a strike.”

          • The only thing that’s hypothetical is your IQ, Toad.

            This demonstrates your full ignorance of economics (and economics-related humor).

            Economist umpire – “Strike 1! On the other hand….”

            Your pathetic attempt at humor once again comes off as witless.

            Fool.

      • So instead of getting a checkup and a $4/prescription at Wal-Mart, Indiana bus drivers turn up at the public hospital ER and cost taxpayers big money.

        Either no one gets sick or dies in Paulworld, or Paul wants us to step over dead bodies on the sidewalk like we live in Zimbabwe.

        • “So instead of getting a checkup and a $4/prescription at Wal-Mart, Indiana bus drivers turn up at the public hospital ER and cost taxpayers big money.”

          Blame your boyfriend Barack, and yourself for cheering it on, for raising the price of labor. In any case, I guess we can rule out sun spots now, eh?

          “Either no one gets sick or dies in Paulworld, or Paul wants us to step over dead bodies on the sidewalk like we live in Zimbabwe.”

          I guess no other options are possible in Toadopia.

          Regarding the third world, people like you have been running once fabulously rich Detroit for over 40 years. Lots of dead bodies you can step over now while adrift in your feverishly imagined moral superiority.

          • I’ve been in Detroit a couple times. I’m not sure how my visits changed anything one way or the other. The die was cast IMO when the Japanese agreed to voluntary import controls in the 80s and the Big Three blew their profits on everything except making a better car. But hey bidness never screws up, right Paul?

            You ignore my point (of course). We already have universal heallthcare in the worst possible way — in the ER where hospitals cannot turn away people who can’t pay.

          • ” The die was cast IMO when the Japanese agreed to voluntary import controls in the 80s and the Big Three blew their profits on everything except making a better car”

            I see. And so of course that created Detroit’s 47% functional illiteracy rate. Detroit became a perennial favorite for murder capital of the US because of quality issues at GM.

            It all makes sense now, Toad.

            “We already have universal heallthcare in the worst possible way — in the ER where hospitals cannot turn away people who can’t pay.”

            And so rather than fix that, Obama had to completely obliterate the rest of the health care system while you cheered. How many bodies did you step over before EMTALA was passed, Toad? I was a kid at the time, but I’m sure I’d remember the rotting stench.

          • Detroit looks like it does because the white middle class fled. That die was cast in the the 1950s when the need for a metropolitan government became painfully obvious but the Pauls in the burbs said hey not my problem. (besides, in 60 years we can blame liberals.)

            You saw me cheer when Obamacare was passed did you? Funny because I was outraged at the amount of ,regulation needed to turn over to insurers, which won’t keep them from ripping off the treasury anyway, when all we needed to keep them honest was a public option.

          • “Detroit looks like it does because the white middle class fled. That die was cast in the the 1950s when the need for a metropolitan government became painfully obvious but the Pauls in the burbs said hey not my problem. (besides, in 60 years we can blame liberals.)”

            Google that metropolitan stuff, did you? Why would the white middle class flee when the liberal nirvana was just beginning, Toad?

            “You saw me cheer when Obamacare was passed did you? Funny because I was outraged at the amount of ,regulation needed to turn over to insurers, which won’t keep them from ripping off the treasury anyway, when all we needed to keep them honest was a public option.”

            Heh, public option. I guess Obamacare by itself isn’t enough of a trojan horse for single payer, is it Mr Libertarian?

          • Paulworld must be such a lovely place. Here is a story about the Dallas Parkland Hospital CEO who got so incensed by dumping that he got Texas to pass a EMTALA-like law before EMTALA. No easy feat. http://www.hhnmag.com/hhnmag/HHNDaily/HHNDailyDisplay.dhtml?id=4770007463 In a Metro area, dumping uninsured patients at the public hospital ER is where push came to shove pre 1986. But go 100 miles east in Texas to a county there is no public hospital. Whatya suppose happened then, Paul?

            What was the white middle class fleeing in Detroit? Black people. You know, the invisible people in Paulworld who ask “More coffee sir?” Liberals fled too. On the block where you live, everyone is conservative.

          • “In a Metro area, dumping uninsured patients at the public hospital ER is where push came to shove pre 1986.”

            But what about the bodies, Toad? How high did they stack up? How bad did the stench get before you turned around?

            ” But go 100 miles east in Texas to a county there is no public hospital. Whatya suppose happened then, Paul?”

            Bodies piled everywhere? I’m sure you have some pictures you can show me in the Zimbabwe’d America pre-1986.

            “What was the white middle class fleeing in Detroit? Black people. ”

            Ah, I get it. Raaaaacists. Wondered how long it would take you to pull that one out. Funny thing though, why should it matter if the whites fled this shiny new liberal model city, Toad? Something deficient with black people? Sounds like you’re the racist.
            LBJ began the dumping of vast fortunes into Detroit to
            prove the liberal idea that if you throw enough government bureaucrats and taxpayers money at a problem, perfection will ensue. Worked great, didn’t it?

            “the invisible people in Paulworld who ask “More coffee sir?”

            That would be quite confusing if they’re invisible.

          • vast fortunes = $77.6 million in Paulworld. Apple’s international tax dodge saves the company that much money in a day.

            As for dead bodies, how about some post EMTALA? http://www.ouhsc.edu/bc/documents/emtalacases2012.pdf I liked the one in Chicago where the teen’s buds carried him to the ER entrance ramp with a gunshot wound to the stomach, where he stayed until the police came to carry him the final few feet, whereupon he died.

            I am still waiting for your explanation of how an anti-gummint fellow like you can accept a law that requires a private company to give away its services, in some cases to the uninsured who CHOOSE to be uninsured, but attack a law that would require the aforementioned to carry their own weight.

            As for racists, I guess you miss the part where I wrote that liberals fled too and that everyone is conservative when you the subject is the street where one lives.

            The real world is messier than Paulworld but you can’t fix it if you won’t acknowledge the problem.

          • “vast fortunes = $77.6 million in Paulworld. Apple’s international tax dodge saves the company that much money in a day.”

            You just made up that #, Toad. The link I posted notes the Model Cities program cost about $400,000,000 in Detroit alone. That’s about $3 billion in today’s dollars. Now add in the other social programs funded by the feds and the state of Michigan and we’re talking “vast fortune,” that produced the bankrupt hellhole of 2013, Toad. Detroit was the richest per-capita city in the US just before you libs got your filthy mitts on it.

            Nice work. Why should anyone trust your do-goodism with other peoples’ money now?

            “As for dead bodies, how about some post EMTALA? http://www.ouhsc.edu/bc/documents/emtalacases2012.pdf I liked the one in Chicago where the teen’s buds carried him to the ER entrance ramp with a gunshot wound to the stomach, where he stayed until the police came to carry him the final few feet, whereupon he died.”

            Ah yes, Chicago. Another fine example of the aftermath of liberal policy. Gun control and welfare are such a potent brew, eh Toad?

            “I am still waiting for your explanation of how an anti-gummint fellow like you can accept a law that requires a private company to give away its services, in some cases to the uninsured who CHOOSE to be uninsured, but attack a law that would require the aforementioned to carry their own weight.”

            In part, because the new law doesn’t do that, asshole. All the subsidies and Medicaid built in mean there are still plenty of free-riders, though the composition changes around a little. As Obamacare whore Ezra Klein puts it, “The poor pay next to nothing. The rich pay full freight. “

            “As for racists, I guess you miss the part where I wrote that liberals fled too and that everyone is conservative when you the subject is the street where one lives.”

            But the “we’re all racists” explanation is your after-the-fact excuse. On the front end liberals like you promised the $15 trillion and counting War on Poverty would produce glorious results. Instead, crime, illegitimacy, and government dependency skyrocketed. Poverty stayed about the same. And now you try to explain away the failure (in Detroit at least) by saying it all failed because whitey fled the scene? Much like the rationalizations popping up from liberals now for Obamacare, that ain’t what you promised we would get for the money.

            And it’s racist.

  2. I agree w/ CptnJustc above. Far too many drivers have no business behind the wheel of a land-bound vehicle (because of either their inability or dis-inclination to drive safely and courteously). I shudder to think what life would be like if we let these a-holes pilot airborne vehicles. Late Sat nights / early Sunday mornings could start looking like a pandemic of 9-11 type building disasters when the bars closed down, and heaven help you if you get targeted by someone with ‘sky rage’. It’ll be like WW1 flying ace dogfights all over again…

    • Someone could write a long post about whether glow in the dark decals are necessary in a fire stair, but I doubt you’d want to read it.

  3. Gee, I may have been flight-certified before I could legally drive a car, but that took a lot of aeronautics education and simulation.

    You’re groundlings. Accept it, because a lot of you can barely handle a motor vehicle. Try a jetpack first, go break both of your legs, and then GO BACK TO SCHOOL, KNUCKLEHEADS. I don’t want to have to dodge half the Human race.

  4. Seriously, a “libertarian” site is full of comments that the people aren’t capable of self-rule. WTF? Cars don’t have to fly thru the air willy-nilly, morons. Perhaps they hover for 20 years… Maybe in that time youngsters figure outhowto hover higher? Keep the old folks on the ground? Morons…and not the good ones lurking at Ace

  5. Sorry, but you lost me at the title. I know it’s not supposed to be taken at face value, but it’s so stupid that it makes it difficult to take seriously anything following that.

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