9 Unintended Consequences of Well-Intended Laws

Welcome to America! …The Land of Unintended Consequences. We have the greatest of intentions with an alarming degree of shortsightedness.

Below are 9 ugly examples of unintended consequences. Unintended consequences are outcomes that are not the ones intended by these well-meaning actions. Leave your party affiliation at the door.

1)    We create a minimum wage to help the working poor.

The unintended consequence is that the lowest skilled workers become unemployed. Under minimum wage laws it is illegal to hire the lowest skilled workers for what their labor is worth to an employer. Shame on us.
Solution: Eliminate minimum wage laws.

2)    We offer welfare for those in need of assistance.
The unintended consequence is that many on welfare find it more advantageous to stay on welfare rather than working to support themselves. Our efforts to help those in need have led to the subsidization of bad behavior. Sheesh people.
Solution: Eliminate government welfare. Welfare should be privately managed in a free society. As organizations reliant upon private, freely offered donations, privately managed welfare is accountable to donors and has an incentive to reduce fraud and abuse.

3)    We pass Affirmative Action laws to help minorities get into the workforce.
The unintended consequence is that the low skilled minorities have a harder time getting hired. Low skilled minorities come with higher legal risks when compared to non-minorities of similar skills. For example, the financial and legal risk for a small business owner to attempt to fire a poor performing minority is greater than the risks associated with a non-minority. Hence, these protected minority groups have a harder time finding employment. Way to help out, people.
Solution: Eliminate all Affirmative Action laws.

4)    We pass bans on guns to reduce gun violence.
The unintended consequence is that law abiding citizens are less safe. Law abiding citizens that follow the rules make themselves easier victims for non-law abiding citizens with guns. We protect ourselves
and our children “No Guns Allowed” signs instead of guns. Way to go.
Solution: Preserve the Second Amendment.

5)    We criminalize drugs to make people safer.
The unintended consequence is that people, especially low income minorities, are less safe. Because drugs are illegal, violence, instead of rules of commerce, regulates the industry. Also, millions of people, especially (and unfairly) low income minorities, are jailed for drug offenses that amount to a non-violent crime that did not infringe upon the rights of anyone else.
Solution: Legalize drugs. All drugs. People own their own bodies. We should not lock people up in cages for behavior that is destructive to themselves and nobody else. Are we free people or not?

6)    We set up rent controls to make housing affordable.
The unintended consequence is housing shortages. Renters that would have downsized their rental apartments will instead choose to squat in rent-controlled apartments because there is no economic incentive to align housing square footage with their reduced needs. This leads to housing shortages. In addition, apartment owners often abandon their severely dis-repaired buildings. This is because the artificially low rental income does not align with expenses required to maintain buildings. The Rent is Too Damn High Party consists of one indignant (but well intended) boob.
Solution: Eliminate Rent controls.

7)    We promote home ownership by keeping interest rates down.
The unintended consequence is that people lose their homes in a housing crash. In a free market interest rate environment, rates would fluctuate naturally based on market fluctuations. When interest rates rise, the prices of homes will decline as the demand for homes declines. However, when interest rates are forced artificially low, home buyers can magically afford more than they could under free market conditions. As a result, home buyers bid up the prices of homes with their cheap credit as their leverage. This incentive for home buyers to over-leverage in debt inflates a housing bubble that eventually has to pop. The salt in the wound is when the people lose their equity – big banks are bailed out. This bailout, of course, is courtesy of these same taxpayers that lost their equity in their homes.
Solution: Eliminate the Federal Reserve. No organization, especially a government arm, should have the power to manipulate interest rates.

8)    We create the FDA to keep our food supply safe.
The unintended consequence is that our food supply is less safe. A megacorporation called Monsanto has infiltrated the FDA regulatory and legislative process pushing their corporate agenda over our public food safety concerns. Consumer interests are second to corporate interests. Who wants seconds?
Solution: Eliminate the FDA. Are you telling me that people are incapable of organizing private organizations to certify to quality of food and drugs? These private organizations would be accountable to the people instead of the corporate masters that dominate the FDA.

9)    We create the FDA to make safe prescription drugs available to the people.
The unintended consequence is that people are blocked from innovative drugs and
arrested for using “illegal” drugs that treat their symptoms. The FDA drug approval process is built to protect the interests of existing big pharma powerhouses. Creating a new, innovate drug on a low budget is a threat to big pharma’s bottom line. Permitting ordinary people to grow a marijuana plant in their back yard to treat glaucoma symptoms is also not compatible with the interests of big pharma. The FDA serves its big pharma corporate masters.
Solution: Eliminate the FDA. See the solution for #8.

How many regulations, laws, and government agencies have been created with the best of intentions but led to distortions that are worse than our original maladies? Giving the government the power to do good is also giving them the power to do bad. Instead of giving the government the power to do good, we should limit their power. The free market is a much more effective means to regulate. We can take any example cited above, remove government interference, and find ourselves collectively in a much better position.

 “Power to the people” is not just a catchy line in a Public Enemy song. Power to the People has real, tangible benefits. Giving Power to the Government does not serve the interests of the people.

“Fight the power… Power to the people no delay!”

Knowledge = Power. Peace. Freedom.

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98 thoughts on “9 Unintended Consequences of Well-Intended Laws

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  24. We recently published a column describing a few instances of the law of unintended consequences specifically, what happens when well-meaning legislation winds up hurting the parties it is designed to help.

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