As we near an election where many have the choice between a MAGA-identified Republican and a Socialist, we are yet again reminded that both of our major parties seem to support the same policy solutions. Around the country, politicians on both sides of the aisle are supporting more regulation and more barriers to U.S. businesses. They do this in the name of populism, of appealing to the masses, but members of both parties have resorted to solving these “popular” issues by proposing the laziest policy solutions they can find. They do this because these are the easiest policies to explain, but the easy way out is almost never the right way.
Take the case of prediction markets like Kalshi. Utah Republicans have looked into banning the platform, and in Nevada the Governor has attempted to regulate the platform as a form of gambling. While these are two separate issues – one is a moral objection to gambling while the other comes from rent seeking donors (casinos) – banning the platform and increasing regulation are two of the worst policies that are available, although they are both admittedly easy to explain.
In reality, the fight in Utah is less about gambling and more about entrepreneurship and capitalism in general. Entrepreneurs “gamble” on themselves by assuming huge risks in the hope of a big payout later. However, starting a business, unlike gambling, is something that is widely celebrated around Utah. An entrepreneur believes in himself, believes in his knowledge, and puts his money behind what he believes in.
Entrepreneurs aren’t risking their money against a corporate casino that sets the odds. They are betting on themselves. Prediction markets work the same way. People aren’t betting against the casino, they are investing in the things that they know. This is how the stock market works as well. For someone to buy Apple Stock, someone else has to sell it. For this to happen, someone must believe that the stock price is going to go down and someone else has to believe that it is going to go up.
In Nevada, they are trying to regulate prediction markets like casinos. The argument from casinos is that if they have a regulatory baseball bat hanging over their heads, then prediction markets should too. This is wrong on its face, simply because prediction markets aren’t casinos setting the odds. It also just doesn’t make sense from a Republican point of view because it calls for more government instead of less. The Governor should be arguing for less regulation of casinos, not for more regulation of prediction markets. In other words, the Governor should be calling for government to threaten fewer people with baseball bats.
It isn’t just prediction markets, though. Politicians from both parties are calling for more regulation on data centers. They are calling for more regulation on big tech. They are telling college sports teams how they should be run. And politicians are now telling us which goods we can and can’t buy.
There are moral arguments for more regulation, there are national security arguments, and there are self-interested arguments. But none of these arguments will make American businesses more competitive. None of these arguments will help America compete in global markets.
Politicians can continue talking about these things, but their solutions should be focused on what needs to be done to enable the next generation of entrepreneurs and job creators. How do we make it possible for competitors to take on the big tech companies of the moment? How do we unleash American Innovation?
The answer will always be less regulation, fewer roadblocks, and a smaller government that takes less money to fund. We need politicians, on both sides of the aisle, who are willing to do the hard work instead of just taking the easy way out.
In the meantime, the choice in this election is between one party that says it wants to add roadblocks outright, and one party that is installing roadblocks without admitting to it. Americans are going to make their choice, but the party telling the truth is the one that is most likely to win.
