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Paul Cleveland: A Case Study

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Paul Cleveland argues that government regulation places controls as well as creates barriers into industries that do not serve the interests of the public rather they tend to serve the interests of the regulated firm (Cleveland, 2007, p. 143). Cleveland further argues that the government regulation cartelizes these industries to operate as state-run monopolies (Cleveland, 2007, p. 143). Additionally, economist Bruce Yandle uses the Bootlegger Baptist theory to show how these regulations get started. Yandle coined the Bootlegger Baptist political theory by examining the early days when Baptist’s were lobbying for regulation to close liquor stores on Sunday (Yandle, 2013). The bootlegger quietly stood by and permitted the regulation because the bootlegger knew, that by banning the sale of liquor on Sunday, would limit competition and send profits their way. Yandle explains that behind every regulation there are features of the Baptist Bootlegger theory that show two different groups supporting regulation …show more content…
Meanwhile, the bootleggers, pharmaceutical companies, insurance companies and others thought the reform would be a way to gain sales while working within the already tightly regulated system (Smith, 2015). The Executive Branch acted as the televangelist focusing on bringing these interest groups together to form a coalition of support. Additionally, the insurance companies had to agree, in return for new customers on the exchange, to “accept greater oversight and regulation of their practices” (Smith, 2015). As the Congress began the legislative bargaining process to enact the new law the insurance companies realized that they were going to lose. Nonetheless it was already too late because special perks were given to Congress members to guarantee the passage of the Affordable Care Act (Smith,

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