Diversity Officers, Compliance Officers, and Other Supernumeraries
International Man: Everywhere you look, ever-increasing government regulations create a serious obstacle to economic activity. There are too many regulations today, many with severe penalties. Most companies of even modest size now have a compliance department, along with numerous compliance officers and supernumeraries. That wasn’t the case a few decades ago.
It seems the compliance industry was created not by satisfying a demand in the marketplace, but rather by satisfying some rule a politician made arbitrarily.
How and why did this happen? What does this say about the economy and society?
Doug Casey: It indicates a growing dislike and distrust of business and commerce and increasing reliance on the government. It’s a disturbing trend.
Companies have a vested interest in providing the best product at the most competitive cost to their customers. That’s how you succeed in business. Government, on the other hand, is necessarily a monopoly based on coercion. That’s bad enough, but it’s run by—no surprise—the type of people who become government employees. You can see them at the DMV and the post office. Worse, the whole apparatus has long been captured by rent-seeking cronies.
The situation is complicated by the fact outfits like Facebook, Google, Amazon, and Twitter work hand in hand with certain government agencies.
It’s unfortunate that at this point you really can’t trust either government or Big Business. On the bright side, however, the average person seems to be becoming aware of that. That’s a good thing because it’s better for the society if everybody is skeptical and questions authority.
Despite that, we’re basically becoming much more centralized. Big companies are getting bigger, merging and acquiring smaller companies. The government continues growing much faster than the economy itself. As an economy becomes more centralized, it naturally becomes less responsive. Big bureaucratic things move slower than little entrepreneurial things. They don’t react as quickly. They don’t notice what the little guy thinks or says and don’t much care about the peons in “flyover country.”
It’s bound to get worse, not just for the reasons I’ve already mentioned, but because legislatures of all sizes are constantly passing new laws. They believe that’s what they’re there for. Old laws are rarely abolished, just buried under new laws. Furthermore, most new laws and regulations are oriented toward identity politics, notions of social justice, multiculturalism, political correctness, and the like.
Government regulations are never good; they subvert the market. And there are more of them now than ever. It goes back to what Reagan very cleverly said about the government versus the economy: “If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”
International Man: According to Reuters, 66% of companies expect the cost of senior compliance staff to increase. And nearly two thirds of companies expect their total compliance budget to be slightly or significantly more over the next 12 months.
This trend doesn’t show signs of slowing down. What does it mean when you have a whole category of busybodies looking for a hundred different reasons to say no to a client?
Doug Casey: Compliance results in waste, inefficiency, and less customer satisfaction. We’re becoming more like the old Soviet Union, where things weren’t done for economic re
Article from LewRockwell