Overlawyered: Chronicling The High Cost Of Our Legal System

Posts Tagged ‘small business’

California regulation: it’ll knock the stuffing out of you

30-employee Woof ‘N’ Poof, which manufactures stuffed collector dolls and other novelty accessories in the northern California community of Chico for sale in Nordstrom and other stores, may soon call it quits [Debbie Cobb/KHSL via Richard Rider, Flash Report]:

[Owner Roger] Hart says a raise in minimum wage and workers compensation are just a couple of issues that have made it difficult to keep the business financially afloat here. Hart said, “The high cost of doing business in California coupled with ridiculous regulatory environment makes it virtually impossible to do business.” He says he has seen an 11% hike in payroll.

…A recent visit by an inspector with the Department of Consumer Affairs set the company back. The inspector from Sacramento cited him for having the wrong size font on the decorative pillow labels. He was told to take the labels out, or they would have his inventory seized. It was a costly fix.

Government is just another word for the things we do together, like threatening to seize pillow inventories with wrong-font labels.

Filed under: , ,

Food roundup

  • If the law was symbolic, consumers were apparently unswayed by its symbolism: L.A. zoning ban on new freestanding fast-food restaurants had no effect on obesity [The Guardian, NPR, Baylen Linnekin, earlier]
  • More on draft new federal dietary guidelines: “Report lays groundwork for food ‘interventionists’ in schools, workplaces” [Sarah Westwood, Washington Examiner, earlier, public comment open through April 8]
  • Opposition to GMOs is not humanitarian [Telegraph] Washington Post editorial rejects labeling on GMO foods;
  • Baker fell afoul of French law by keeping his boulangerie open too often [Arbroath]
  • A sentiment open to doubt: “There is a great need for lawyers to utilize their policy and litigation tools in the fight for a better food system.” [Melanie Pugh, Food Safety News]
  • “Food policy” progressives “whistle same tune as large food producers on issue of food safety” [Baylen Linnekin, related on single-agency scheme, more Linnekin on competition-through-regulation among makers of wine corks]
  • Why restaurant operators need to know about patent trolls [James Bickers, Fast Casual]

Filed under: , , , , , , ,

FDA issues calorie label mandate

Another hidden gift inside the Affordable Care Act: mandatory calorie labeling for many restaurant menus. Walter Olson comments on the complications and potential unintended consequences of such a mandate.

My new Cato podcast: the new FDA calorie labeling rules apply to not-so-big chains (20 +) of grocery stores and amusement facilities as well as restaurants, and make it less likely that servers and local managers will manage to vary from rigidly standardized recipes, menu listings and portion sizes based on knowledge of their local customers, temporary availability of attractive ingredients, and so forth. That won’t matter much for food servers who already design their offerings in a lab, but spells trouble for those whose offerings are more localized or unpredictable (earlier). Coverage by Ed Morrissey of what the scheme would mean for a 21-unit pizza chain is linked here.

In January, David Boaz commented on the parallel vending machine calorie label mandate:

In my experience, vending machines shuffle their offerings fairly frequently. If the machine operators have to change the calorie information displayed every time they swap potato chips for corn chips, then $2,200 [per operator per year] seems like a conservative estimate of costs. But then, as Hillary Clinton said when it was suggested that her own health care plan would bankrupt small businesses, “I can’t be responsible for every undercapitalized small business in America.”

Happy Thanksgiving!

More: Baylen Linnekin. And Julie Gunlock recalls her own days working in a supermarket deli. Goodbye, making up prepared salads in single-serving containers from whatever produce happened to be in overstock at the time. Hello, food waste!

Filed under: , , , , ,

“America’s Most Fee-Ridden Cities”

I’m quoted in this Reason TV segment by Zach Weissmueller on the problem of municipalities that stake their finances on overzealous fee collection:

“When you have towns like those in St. Louis County that get in some cases, 40 percent of their municipal revenue in fines and fees, they have chosen a very expensive way of taxing their population, one that creates maximum hassle and maximum hostility,” says Walter Olson, senior fellow at the Cato Institute and publisher of the blog Overlawyered.

Aside from Ferguson, Mo., the piece uses as examples the notorious Los Angeles suburb of Bell, Calif., exposed in a scandal as being run for the benefit of its managers, and — a smart choice — Detroit, a city with a long-time adversarial stance toward its small businesses and others trying to do everyday business in the town:

…what really grants Detroit this honor is “Operation Compliance,” an initiative pushed by former mayor David Bing aimed at bringing all of Detroit’s small businesses up to code through costly permitting. The initiative launched with the stated goal of shutting down 20 businesses a week.

Filed under: , , ,

Cato online forum, “Reviving Economic Growth”

The panel is packed with big names and many of them offer suggestions with a law or regulation angle, including Philip K. Howard (“Radically Simplify Law”), Derek Khanna (rethink patent and copyright law; related, Ramesh Ponnuru), Morris Kleiner (reform occupational licensure; related, Steven Teles), Arnold Kling (“Sidestep the FCC and the FDA”), Robert Litan (admit more high-skill immigrants and reform employment of teachers; similarly on immigration, Alex Nowrasteh), Adam Thierer (emphasize “permissionless innovation”), and Peter Van Doren (relax zoning so to ease movement of workers to high-wage cities).

Filed under: , , , , , , , ,

Regulating consumers by way of regulating producers

An observation from John Goodman via David Henderson:

Almost all government restrictions on our freedom are indirect. They are imposed on us by way of some business. In fact, laws that directly restrict the freedom of the individual are rare and almost always controversial….

But the vast majority of government encroachments on your freedom of action come about through laws that constrain an employer or a seller – without much controversy. …

After proceeding through examples from workplace safety regulation, liquor control, medical device regulation, occupational licensure, and other areas, Goodman adds:

Let’s take one more example from the health care field. The Obama administration is about to impose new regulations affecting home health care workers. They must receive minimum wages and overtime pay. But as far as I can tell, this rule applies only to workers who are employed by agencies and not to workers who are directly hired by an elderly or disabled patient. No matter how they are employed, the economic effects will be the same – a blow to the seniors and people with disabilities. In one case the effects would be visible; in the other they would be invisible. It’s hard to avoid the conclusion that if there were no agencies in home health care, there would be no new regulations.

The growth of the firm may be inevitable, desirable, or both for separate reasons, but it also makes regulation more feasible by generating an entity more suitable for bearing the regulatory harness. Incidentally, is blocking the Obama home health carer overtime regulations a high priority for the incoming Republican Congress, and if not, why not?

Filed under: , , ,

Marc Andreessen on getting radicalized

Netscape founder Marc Andreessen, quoted in New York magazine “Intelligencer”:

If you have been in an Uber car and gotten pulled over and had the car seized out from under the driver when you were like in the middle of a trip that you were otherwise having a good time on, you might be a little bit radicalized. You might all of a sudden think, Wait a minute, what just happened, and why did it happen? And then you might discover what the taxi companies did over the last 50 years to wire up city governments and all the corruption that’s taken place. And you might say, “Wait a minute.” There’s this myth that government regulation is well intentioned and benign, and implemented properly. That’s the myth. And then when people actually run into this in the real world, they’re, “Oh […] I didn’t realize.”

One of my favorite things of all time is George McGovern, who ran for president in ’72 as a hyperliberal. Of course Nixon [beat him badly]. And in 1992 he wrote a column for The Wall Street Journal which told the story of his life after he left politics, when he bought an inn in Connecticut. And he said, “Oh my God, I didn’t realize.” And the “Oh my God, I didn’t realize” was: I did not realize what a layered impact 50 or 100 years of regulations and laws applied on small-­business owners actually meant.

Filed under: ,