Consider the following from your own informed and educated point of view:
- How important are laws to protect the prosperity of businesses?
- How important are laws to protect society from the (perhaps unintended) costs of business?
- What balance should laws seek to maintain the rights of businesses and the rights of their customers?
Critically consider these questions, looking not only at what you believe but why you hold these beliefs and opinions.
The laws are most important thing in a capitalist society for businesses to prosper. Every business runs by contracts, the customer pays and the seller sells what the payment is worth. But, our society is not free from elements who do not like such contracts, if it wasn’t for laws, then we might see those elements dominating and causing businesses shut their shops. And the statement applies to any kind of business not just retailers, but others too. Laws are there to protect the rights or business owners and customers. If someone invents something useful and he/ she can get a patent on his/ her invention, which is like exclusive commercial right to profit from. If anyone tries to challenge the patent or the commercial rights, then the law and justice system will decide who has the rights. And like I mentioned before if anyone does not honor the basic contracts in business, then the other party can always get help from law and justice system. Say the business owner did not give you what he promised or the customer did not pay you for what you sold his – in these cases law and justice system can work.
But, this does not guarantee prosperity. A business is like a machine, efficient businesses prosper. But, any business that is not good at utilizing its capital might die down eventually, even under protection of law. But the efficient businesses also need the protection from law to prosper.
Laws are very important to protect society too. In every nation and society we depend on governments to do the right thing, bring the right law to protect us. Protect us from businesses who often sees themselves as nothing other than a profit generating Machin. And in the process greed takes over. We saw what Wells Fargo did in the name of generating more revenue. They opened thousands of accounts without telling the customers. Allegedly they opened 2 million bank accounts or credit card accounts without customers knowledge between 2011 to 2015(Blake,2016). There are other dangers too that impacts not only current generation but future generations too. I am referring to businesses those pollute the environment for their profit. Here is one example – per North Carolina Regulators, Duke Energy, dumped 61 million gallons of contaminated water into Cape Fear River from a coal ash pit (CBS, 2014). And there are many more such examples around, even with the technology companies are creating new problems. Google was recently fined by EU. Facebook was being investigated for certain reasons. And I think these are when we need protection from law. Otherwise, very are businesses can do whatever they want to generate profit. I do not think making profit is a bad thing, but if the growth is not shared and inclusive and the business focuses on extorting then it becomes a problem for everyone. And I feel blessed that I have lived my life in democratic countries those are ruled by constitutions and laws, and nobody including the businesses are above law.
Businesses have a right to make a profit. Saying that, an entrepreneur who starts a business he often creates jobs, generate wealth for investors and make larger impact on societies. For example, Henry Ford transformed the way to travel, Google transformed the way to search, and Facebook transformed the way we communicate. I am not saying every impact is good or bad. But, to motivate an entrepreneur laws should protect his rights to do business. If any law say any company cannot make profit over a certain limit, that law will take the motivation away from the business owner. Or if laws make it difficult to do business, to start a business then we would see decline in economic activities. Businesses will not start and less people will find employment and eventually there will be less demand for everything.
In today’s world the laws are catching up to protect rights of customers. Laws should protect customers from corporate greed. And there should laws to promote what is better for future than what is easier now. For example, we have green energy sources, Germany is powered by renewables, and all wealthy country should bring in laws to move towards sustainable future and use renewables than using coal to generate power. So any society does not only deserve protection from corruption or greed but laws can pave ways to have a sustainable future too. And I am not saying corporate will like that, because they will have to invest in capital expenditure to change the way they do business, that might mean the profits will fall, investors will make less money, but we as a society have one planet and we cannot let it get ruined just because some people can’t let go their addiction to profits.