DOESN’T WORK WELL ANYWHERE: France and Control

When the government takes a hand in business, not only does the quality of the business often suffer, but there is the need to control every facet of it.

The government of France finances their film industry. The idea is to keep the actors’ salaries to a certain level. This will affect the industry’s ability to attract the actors they desire for certain projects based on the percentage their salary will be of the film’s total budget.

As we have observed here in the United States, any government operated business traditionally has issues with making a profit.

A perfect example is the United States Postal Service.

While it is still a very good value for mailing letters, it doesn’t exhibit the kind of fiscal efficiency of Federal Express or UPS.

Private industry and small business are far and away the optimum choice for job growth and economic development.

However, there is an agency for every aspect of regulation for any given business.

The fees that are required for startup and maintenance of licenses and other fees that delight a municipality increase every year.

Certain trades are more controlled than others.

For example, sales of alcohol and tobacco are strictly regulated. They require a special license in order to offer these items. These have a lengthy vetting process in order to qualify for the “privilege license.” These are often very costly as well.

You can have no criminal record, DUI, other prohibited background.

In the case of liquor licenses in restaurants, the servers are required by some cities and counties to obtain a separate license for pouring. A background check is performed on each employee to determine if they meet the criteria in order to work and pour as a server.

Annual business license renewal is usually based on the previous year’s sales. The higher the revenue, the more costly the business license renewal. Hardly seems an incentive to do well.

Being that small and medium sized businesses created more jobs in 2014 than large corporations, it is another good argument against excessive government regulation that strangles those who would provide opportunity.

For those who believe the government can do a better job than the private sector, please reference the film industry in France, et al.

Image: http://www.flickr.com/photos/adam_jones/8764161099/