| Let's regulate phone support systems.
My wife is currently on the phone with B of A, because our debit cards stopped working with our current zip code when we buy gas. (They reverted to the zip code where we used to live.) She has been on the phone for about 15 minutes now, going through one phone tree option after another.
There should be a regulation that requires support lines to immediately transfer you to a human if you request it. This is an example of a regulation that benefits the public.
These support lines are an example of "externalizing" a cost. The company buys a phone-tree support system and gets to fire a few more people. (The consumer economy loses a few more consumers.) The executives pocket what those employees were paid. (Wealth concentration increases.)
But that cost didn't just go away, it was transferred to the public. And it was not an equal transfer. Previously, trained support people would assist the customer and help solve the problem right away. This would take a few minutes of a person's time. But now people have to spend big chunks of their own time navigating these phone systems, and rarely get a satisfactory result. So, to save a cost these companies have transferred a much larger cost onto the public.
Cost externalization can mean vastly higher costs for the public than the savings to the company. The classic example is when a company saves on the cost of disposing of toxic chemicals. Where it might have cost the company $500 to safely dispose of a truck full of waste, it costs the public hundreds of thousands or more of dollars to clean up the stream where the waste was dumped.
In the comments, pretend for a minute that you live in a country where the people are in charge, and the people want things done for OUR benefit. If you can free your mind and get your head around such a strange concept, try to dream up some things you would like to see regulated and share them with us. |