It's difficult to know for sure, but my impression is that the number of regulations on businesses are about the same in China and the US. The difference is that, while Americans have to spend their days doing paperwork to comply with all of the regulations, the Chinese can sweep most of them out of their path by making a single payment to their local, corrupt Communist official. Best of all, no paperwork is involved!
The reduction in economic friction of letting business owners just spend their time running the business for profits instead of for regulatory compliance is enormous, and it's available for a quick "tax" payment.
As the business grows, they need to move up the Communist Party food chain and pay bigger guys more money. The bigger guys then order their subordinates to stay out of the way of the business. I've been driven down long stretches of beautiful, almost empty highway in China in a black luxury car at 150 km/h (~93mph), passing dozens of police cars along the way, and been assured that they (the cops) wouldn't bother us, because "they know who we are". That required regional authority, not local.
Of course, part of this "freedom" is the agreement to not do the unforgivable: criticize the government. Your bribes cover most issues but can't cover that one. Fortunately, that's not an issue for most businesses, because they don't make money by criticizing the government.
It's amazing how much more economic value a business can create if it gets to spend all of its time doing business instead of doing paperwork. It's also scary how easy it is for those to pay the bribes to harm those who don't (pollution, dangerous working conditions, etc.) Eliminating all regulation would be a bad idea, but there should be some measurement of how much friction loss is caused by government regulation.
Some regulations (enforced, of course) are generally helpful to an economy. Some are harmful to everyone except the regulators (worth money and power to them). The Chinese corruption way is the wrong way to go, but I'd like to see our regulators having to live within a "regulatory budget", which prevented them from adding regulatory friction every time they saw an opportunity.
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