American Elephants

Chicago Shakedown and How Regulation Kills. by The Elephant's Child

Istria Cafe is a small business in Chicago, one of the most over-regulated cities in America. PJTV’s Alexis Garcia interviews the Pribaz brothers, the owners of Istria Cafe, to show you how regulations are destroying businesses and jobs. Would you believe that it is almost impossible to run a business in Chicago without violating rules and regulations, and paying extraordinary fines? From utilities, to health care Alexis Garcia tells you why some businesses might not survive in the down economy.

Businesses, small and large keep telling us, their representatives in Congress and the administration that excessive regulation is a problem. The administration not only doesn’t get it, they deny it absolutely. This is one of those spots where a lack of business experience tells. Someone who has never held a real private sector job cannot understand why “profit” is not something evil that only the greedy pursue.

And they cannot understand the extent to which regulation interferes. For example, Congress may decide that it would be a good thing if the signs in fast food restaurants contain calorie and nutrition information. This has happened. Such a regulation should begin with a study to see if the presence of such information has any effect on customer behavior, results in different choices, or does anything to control obesity. If all those factors are negative, then the regulation is a dumb idea.

Aside from that, the nature of the restaurant makes a difference. Pizza places and Chinese take out places have literally hundreds of ingredients and choices. Often impossible to convey on a sign. Can be done extensively on a menu. The ‘fast’  in fast food comes from people able to quickly scan a large sign and indicate their preference.  Such regulation may accomplish nothing except kill the goose that laid the golden egg.

Governments that believe they are smarter than the people and can make things better with more regulation cause more problems than most lack of regulations could. We do, of course, need basic safety regulations, but it’s easy for regulation to form such a network of good intentions that the regulated business must give up.


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