Have you ever heard of a family that ran well without any bureaucracy and without any formal regulations? Of course you have, and that because the social group is small and all members are well-acquainted with each other. The group is kept in check as a result of a top-down power structure under the control of the parents. The family is also guided by well-understood customs and habits, by kin selection and by reciprocal altruism. No surprise here, that families don’t need formal rules and regulations.

How about a corporation, though? Have you ever heard of a successful large corporation that had no need for formal rules and regulations? I haven’t. These organizations are much bigger than families, of course. There is little biological relatedness and they lack most of the other “natural” regulation that families have. They are held in check thanks to numerous rules and regulations, many of them published in the corporation’s manuals filled with policies and procedures.

Now think about an entire country. How is it that so many conservatives insist that a country can run well without rules and regulations? How can they insist that the fewer rules, the better a country will run? On what do they base this? On countries without rules and regulations, such as Somalia or Haiti?

We have test cases called corporations that absolutely need formal regulations, yet free market fundamentalists insist that entire countries, which are much larger, much more complex, and rife with conflicting interest groups, will simply run by themselves, without planning or structure.

I don’t get it. Just because many rules and regulations don’t make sense, you don’t through out rules all together. Large organizations need smart rules. They need rules that work. There is no example otherwise. How can this possibly be controversial?