The Regulation Epidemic: How Government Bureaucracy Kills the Free Market

 This story is a dark but painfully accurate allegory for the way in which the State (in the person of the Lion)—driven by legitimate intentions for “control and optimization”—suffocates Free Initiative (the Ant) through an avalanche of administration and regulations. Initially, the Little Ant was an example of private initiative and an unencumbered producer. She arrived early, worked diligently, and created real value for the community. Her output was high, and her work was clean and simple. She represented the engine of the economy, operating without subsidies or government orders, motivated solely by the desire to produce. The ruler—the Lion (the State Apparatus)—noticed her uncontrollable but impressive productivity and thought, "If this entity (the Ant) creates so much wealth unencumbered by public standards and oversight, how much more could be squeezed out... if we imposed controls and regulated the process?" In the name of “greater transparency and security,” the Lion appoints the first Regulatory Authority—the Cockroach. The Cockroach, who has extensive experience in preparing reports (but zero experience in production), immediately introduces the first state control: Mandatory Access Registration (the first regulatory burden). The Spider (Compliance and Supervision Authority) is appointed, which archives the reports and controls the communication (a new layer of intervention and monitoring). The Lion, delighted by the volume of documentation, requested new graphs, trend analyses, and presentations for public speeches and summits.  To support this growing administrative burden, the State (the Lion) invested in technology: expensive software was purchased, and the Fly (the new Informatics Department/Digitalization Project) was hired, whose sole job was to maintain the accounting system, not production. The Ant, who was a cheerful and productive citizen until recently, is now desperate. Filling out forms, attending "optimization" meetings, and following procedures completely consume her working hours. Her real output is falling dramatically, but the administration is growing exponentially! The position is given to the Cricket (high-ranking civil servant/minister), who immediately invests public funds in his personal comfort (rug and ergonomic chair). The Cricket immediately hires an assistant (loaded with a new budget) to prepare a strategic plan and budget control—even though the budget is spent mostly on their administration and salaries. At the end of the year, the Lion (the State) notices that the revenue from the Ant sector has dropped critically, while the administrative costs have doubled. In order not to take political responsibility, the Lion hires the Owl—an expensive international consultant/auditor—to carry out an “independent analysis.” After three months and multi-volume reports, the Owl announces the obvious conclusion, for which a million-dollar fee was paid: “There is a dangerously high concentration of personnel (administration) in this sector that does not add value.” Who does the Lion fire, exclude from the market, or crush with taxes? Of course, it's the Ant! The final report states that Ant exhibits "a lack of motivation" and "conflict behavior" due to her criticism of the unnecessary regulations. This novel is a story about how government intervention, rather than supporting it, destroys the real economy. The conclusion is clear: Excessive regulation and bloated bureaucracy do not lead to greater efficiency but to the stifling of productivity and, ultimately, to economic collapse and the search for a scapegoat.  My personal opinion is that politicians buy votes by appointing new regulatory agencies. 

Author: Sezgin Ismailov