by: Mark Marks
(Novasolum Free Press – Sinclair Publications)
You may have heard of the old adage “If you want peace, then prepare for war.”The meaning behind this non-sequitur is that the nation which makes military preparations, builds it forces and equips and trains them well, will be less vulnerable to threats from its enemies and will therefore have “peace”.
A similar case can be shown in the field of economics, where a contrary action on the part of the government might be the best stimulus for the free market.It is this:If you want to stimulate enterprise, then make strong regulations.
The reasons why strong regulations are good for a free market are as follows:
Strong regulation of economic activity serves to protect the users of the economy and the state.The threats to an economy range from poor business management, to unscrupulous activity, to outright fraud.
Fraudsters can be exposed and controlled if the law covers as many fraudulent actions as possible, and also if the law that is peripheral to economic regulation – such as criminal codes, and the law of jurisprudence (court systems) – is solid.Unscrupulous operators can also be controlled if loopholes in the regulations are minimised, and if clients of businesses have a way of dealing with their grievances.
The major flaw with this, as effective and enforceable as it is in the real world, is that in micronations a shoddy salesman or a fraudster simply disappears when the law starts chasing him.Anthelia had a prime example in the banking sector, when the First Micronational Bank and its owner Austi Scot came and went like dew on the morning leaves.
Poor business management was mentioned above, but a strong and well-presented regulatory framework for business will not only keep businesses honest, but also help them to manage themselves.A businessman who has no obligation to the state to report his finances has no motivation to keep proper accounts of his operation, and this can cause inconvenience for his clients and inconsistency in his own management.However, if the same businessman is required to tender regular reports to the authorities, then he must do something to keep his books in order.
The absence of regulations means that businesses operate in a vacuum.Every businessman can do things his own way, and nobody needs to watch over him.However, in a regulated environment, work is created for the authorities who enforce the regulations, and for free-market professionals such as accountants and lawyers who will be engaged by some businesses to help them comply with the regulations.
There is even a generation of what might be called “tertiary activity”, although in the chain of events it usually comes first.Political activity is generated through the processes required to make, review and update economic regulations.The political activity is both pro-active (preparing regulations for anticipated needs) and reactive (adjustment of regulations in response to changing economic circumstances).
Micronational governments have a duty to build their communities, and because participation in an online community cannot be forced on a person then the only sure methods are the carrot and stick.Economic and business regulations are both.They are the stick in that they draw boundaries for economic activity outside which sanctions may result; and they are the carrot in that they build a positive environment for potential operators to try their hand at private sector projects.
In the end, micronational economies will only survive if the private sector is larger than the public sector, since the government must tax the private sector to fund its own operations.People also derive greater satisfaction from running their own project as compared to pulling one oar of the ship of state (although willing and satisfied public servants do exist).So the duty of each micronational government which aspires to have an active and growing economy is to promote and stimulate that economy at every turn.
Stimulation of the economy is usually thought of as the injection of money, but that is well short of the full treatment.A person who attends a gymnasium seeking to build a better physique requires more than just an hour on the treadmill.Comprehensive, effective and enforceable economic regulation is the key to maintaining progress and growth in a micronational economy.