The Atlantic's Daniel Akst, inspired by new safety regulations on children's toys, finds a variant of winner-take-all economic theory:
People are horrified to discover the dangers of some sensitive product--say, milk--and government reacts with legislation. But that legislation requires new equipment, testing and procedures. The result, often, is rapid consolidation into a handful of much bigger providers. It's just very difficult to bear the burden of expensive new requirements unless you happen to be doing a great deal of business.
Hyper-cautious laws do seem to be a serious burden on small business, not to mention students trying to raise a little cash. From the New York Times last year:
The old-fashioned school bake sale, once as American as apple pie, is fast becoming obsolete in California, a result of strict new state nutrition standards for public schools that regulate the types of food that can be sold to students. The guidelines were passed by lawmakers in 2005 and took effect in July 2007. They require that snacks sold during the school day contain no more than 35 percent sugar by weight and derive no more than 35 percent of their calories from fat and no more than 10 percent of their calories from saturated fat.
Even a big-government liberal like me would like to see the pendulum swing back on this stuff.
