By quite literally ensuring that businesses actually comply with the rules? Same as a compliance department and safety department. They ensure that short term profit is not put ahead of long term problems following on, eg paying workers and preventing discrimination such as preventing no white male workers from being hired, which is deleterious to the economy as a whole. The money would not necessarily go to production or support, it would more likely go to shareholders as it would count as increased profit. Remember, a business seeks to make as much money as possible for as little cost as possible. if it can increase profits by cutting costs/corners, a business would normally be cutting those corners. A government is simply the HR and safety and compliance department as a whole for the entire economy. The government arent profit creators necessarily, but the government is a cost reducer.
Simple example: NZ. We have regulations surrounding waste disposal. By your claim, this is a cost to the economy. But, ensuring companies follow this rule allows us to be seen as a top tourist destination for those who want unspoiled natural beauty, and improves our tourism income. In addition to this, it allows us to have a better quality of life by being able go out and exercise, such as swim, kayak/canoe, fish etc, in clean water. This encourages people to go on domestic tourism trips, as opposed to heading overseas. Therefore, this regulation may be slightly deleterious to individual businesses but advantageous to the country as a whole.
The easiest way to think of a government is that they are there to prevent the tragedy of the commons...
PeterZ wrote:Thank you for quoting this. The prior poster is on my ignore list.
Regulations make having an HR department necessary. Then how on earth is a service that enables compliance additive to the economy as a whole? Without the the regulations the money spent on HR would go towards actual production or sales support. So how does government add anything in this exchange? It does not.
This has nothing to do with providing services people need regardless of any regulations. Doctors will offer services to the sick. Accountants provide accounting services. IT services improve efficiency. All those services add value.
Regulators that erect legal barriers to doing business are not adding value even if businesses have to hire people to navigate those barriers. That's like saying that breaking windows will force people to repair those windows and stimulate the economy and add value. More people will work but no value is created.