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Denial – a statist in Congress

December 29, 2010

Pulling together three or four posts into one common theme – the Philosophy of government that one side holds is that they must legislate to a desired OUTCOME, resulting in a lot of punative legislation to get there.

The problem with punative legislation is one of our favorites – unintended consequences. Jim’s example earlier this week – gun laws around concealed carry in Wisconsin and the crime rate. Today’s example

Real Clear Politics: A new bureaucracy will stop greedy credit card companies from unfairly penalizing you. And it won’t threaten the credit business. Yippie!  

That was the intent at least. Just like the INTENT of Wisconsin’s concealed carry law was less crime because fewer people were carrying. The result might have been something else…

… what happens to the people who depend on the store for self-defense in a high-crime area?  The article clearly points out that the current legal system doesn’t do anything to keep guns out of the hands of criminals, so how does rewarding the criminal by removing them from the hands of legal citizens help?

So – back to the credit card regulation. What’s the ACTUAL result turning out to be?

The law of unintended consequences is never more clear than in the capping of interest — so-called usury laws. Arkansas once capped interest rates at 10 percent…Arkansas then became known as the pawn shop capital of America. Pawn shop interest can be 250 percent.

In the 1960s, the second biggest revenue source of organized crime was illegal lending. Is that the world we want to go back to, where we get rid of payday lending, and we’re so morally outraged that we’re going to put people in the hands of the leg-breakers and the loan sharks?

well, the lawmakers didn’t INTEND for that to happen. It SHOULDN”T happen as a result… unfortunately they didn’t plan for workarounds & unintentionally set up a grey (or black) market as a result of their legislative “help”

the problem is the denial of  potential pitfalls simply because the pitfall isn’t the result they intend. Yes, grasshopper. That is why it’s called UNINTENDED consequence….and why I really wish they’d  think through them more before acting

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