Picture this: You've sacrificed it all - missed friends’ weddings, your kid's recitals, years of labor, sleepless nights. All for your first company. Until finally - FINALLY - you've landed Series A funding. Time to sign those docs and get that sweet, sweet capital, baby.

But you’re in Germany, which means you have to sit through 12 hours of a notary reading your investment agreement. Out loud. Word by word. Monotone, while everyone sits there, phones out, already knowing what they're signing.

DocuSign exists, but unfortunately for you, Germany doesn’t care. This kind of torture session is actually what happened to this guy, who called it what it is - “prehistoric madness.”

The world runs on rules like these that are so stupid they sound fake, but they're real, and they're killing our progress.

Strap in, we’re going on a tour is your 101 guide to the multiple levels of bureaucratic hell.

You know that feeling when you hit a certain age and your body feels like it just sort of... drops off? Maybe it's 29, maybe 37, but suddenly it hurts and you make noises getting up from chairs.

That's what these regulations are - sudden cliffs where everything changes at a pretty arbitrary number.

France has a problem with 50 employees, reportedly. Once you hire your 50th employee, dozens of regulations now apply to you. Works councils, detailed government reporting, profit-sharing requirements, onerous barriers to firing anyone - you name it, they got it.

“The desire to avoid these requirements leaves France with a disproportionate number of smaller firms compared to Germany or the United States.”

France has more companies with exactly 49 employees than 50. Yes, some is fluffing the numbers, but no, this clustering is also not very subtle. They're literally strangling their own economy to avoid paperwork.

This kind of thing isn’t unique to France though. Even the U.S. does this sort of thing too.

The Affordable Care Act (ACA) kicks in at 50 full-time employees, so take a wild guess as to what happens? Companies hire 49 full-timers and supplement with contractors, like vitamins. This is because the ACA mandates that companies with 50 full-time employees offer minimum essential health coverage to at least 95% of full-time employees and dependents.

"When a measure becomes a target, it ceases to be a good measure." – Marilyn Strathern

Some rules are born from the ashes of crisis, serve their purpose, then shamble on for decades as undead legislation.

Meet the Jones Act (1920).

You shouldn’t really know what the Jones Act is, but you should know that it’s a bunch of malarkey. All it means is that any cargo moved by water between two U.S. points must ride on a U.S.-built, U.S.-flagged, U.S.-owned, and U.S.-crewed vessel. Ergo, STOOPID.

This why shipping to places like Hawaii and Puerto Rico is so expensive!!!!

This is ALSO why, in 2017, after Hurricane Maria devastated Puerto Rico, Trump had to waive the Jones Act just so that foreign aid ships could deliver supplies to the island!!

The Jones Act is only a thing because, after WWI, Congress wanted to (1) build up a reliable domestic merchant marine and shipbuilding industry, and (2) also protect it from foreign competition, while serving as both everyday commerce and to aid in war

This is the definition of a zombie law. A century-old rule born out of wartime angst yet still steering peacetime shipping _{see what i did there.}

It’s also been a total failure for its original goal of increasing American-made ships.

We even have things like the Japanese Hanko System.

This is known as a hanko signature seal.

For over 2,000 years, the Japanese have this tradition of using their own personal stamp instead of a lame digital signature. Sounds pretty cool!!

Herein lies the rub, though: Japan legally recognized digital signatures in 2000, yet people STILL commute to offices to physically stamp documents. The pervasiveness of this obsession with hanko signatures seemed to reach a breaking point during COVID, when people went to work….. to stamp their work-from-home papers.

As noted by the author of the article above, “…the concept of a signature seal in daily use is outdated, outmoded, and destined for the scrap heap.”

Brazil is (in)famous for its overbearing, bloated bureaucracy.

I work with dozens of nonprofits in Brazil, and they’d all attest the same. Brazil has achieved peak Kafka with "emendas parlamentares" - simply put, these allow federal lawmakers to earmark slices of the annual budget (LOA) to specific projects in their states/municipalities. God bless them, it was with good intentions - Congress had the theory that representatives can target local needs, but they’ve mostly become a Kafkaesque merry-go-round.

These are more complicated than regular grants because:

It's like the Greek tale of Sisyphus but with PDFs.

“The world is better understood as misaligned incentives rather than coordinated oppression - Most social problems stem from coordination failures and competing interests, not a capitalist class conspiring against everyone else.” - Lennox Johnson

Back to our German friends. The worst part about the notary reading is that they charge ~€500/hour for this performance.

But something debatably worse, South Korea's banking system required Internet Explorer and ActiveX until 2020 (!!!!). Microsoft killed ActiveX in 2015, and Korea responded "hold up - we'll take our chances."

Their 1999 security law mandated specific encryption that only worked in IE. For two decades, Koreans ended up having to rely on ancient PCs for specific transactions. Well-intentioned security regulations that led to stagnation and security risks via dependence on Internet Explorer, OF ALL THINGS 🤮

The IRS could file your taxes automatically. If we lived in a REAL country, this would be our reality, like dozens of other developed countries. But Intuit and H&R Block have spent millions ensuring Americans waste billions of hours annually on tax prep. This is multi-billion dollar industry pumped up by manufactured complexity.

A few years ago, the Biden admin actually had a solution - Direct File, which led to an average user spending over an hour to complete their taxes, vs. 13 (!!!!) before. It was expanding to more Americans, until the Trump admin murked it.

Lastly, many people foolishly lament the fall of taxi drivers, like NYC’s taxi medallion system, and criticize the rise of ride-sharing. Oh how we forget - the taxi system was overall whack af.

The government launched NYC’s medallion system started in 1937 to limit the supply of taxis. But the medallion system became such a racket that the market value of a medallion was going for $1,000,000 by ~2013!!! A speculative asset propped up by artificial scarcity, terrible service, and zero innovation.

Not you though, Cash Cab. You were different.

Possibly the greatest offender of them all, because the consequence is death.

I’ve given Europe lots of flack for their refusal to adopt AC at scale, and this post goes into all the nitty gritty.

If you have no clue about this, good, because if you do, it means you’ve probably suffered in the European heat.

“With this rise in temperature — and the aging of the European population — has come a rise in preventable death. Estimates of heat-related mortality vary, but the most commonly cited number is 175,000 annually across the entire region. Given that Europe has a population of about 745 million, this is a death rate of about 23.5 per 100,000 people per year. For comparison, the U.S. death rate from firearms is about 13.7 per 100,000.

So the death rate from heat in Europe is almost twice the death rate from guns in America. If you think guns are an emergency in the U.S., you should think that heat in Europe is an even bigger emergency.

Most of this death is preventable. The technology that prevents it is air conditioning.

Barreca et al. (2016) find that heat deaths in America declined by about 75% after 1960.”

Welcome to the AC wars. In places like Germany and Switzerland, you often need your landlord’s permission to install AC. The tyranny!!!!

France thinks of "climatisation" as American excess. LOL. Meanwhile, their productivity tanks every summer, and most importantly, deaths rise.  "It's American decadence!" they cry. But hey, at least they maintained cultural purity while elderly people cooked in their apartments…

In Italy, neighbors literally snitch and call the police on you if you install AC. The narks are everywhere.

These rules and ways of doing things aren't just annoyances. As you can see, they're literally killing people (European heatwaves), destroying economies (French companies), and preventing solutions to real problems (Jones Act).

Stripe CEO Patrick Collison has a list noting how most fast infrastructure projects happened before 1970. We built the Empire State Building in 410 days and launched Bank of America in just 90 days. But now the bar is on the floor - San Francisco spent 21 years and millions of dollars on a single bus lane.

Trump's admin wants to allegedly cut regulations in half, which sounds insane until you realize we're living in a crazy Monty Python sketch.

Maybe some things deserve to be broken. We built a civilization that can split atoms and decode genomes, but then you need permission to install AC.

Thanks for taking the Pack,

Zach

_{The vibe-killer disclaimer: The opinions in this post and all other posts only represent myself and do not represent the opinions of my employer or any groups I am a member of.
This is not financial advice or recommendation for any investment. The Content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice}