Federal Regs System Is Still A Problem Fifty Years Later

Wednesday, 29 October 2014

This week marks the 50th anniversary of Ronald Reagan’s speech, “A Time for Choosing,” which shined a national spotlight on Reagan and helped launch his political career. In the speech, Reagan stresses the importance and ideological motivation behind a smaller, more efficient form of government, noting the economic burden of overregulation.

According to Reagan, “Federal employees—federal employees number two and a half million; and federal, state, and local, one out of six of the nation’s work force employed by government. These proliferating bureaus with their thousands of regulations have cost us many of our constitutional safeguards. How many of us realize that today federal agents can invade a man’s property without a warrant? They can impose a fine without a formal hearing, let alone a trial by jury? And they can seize and sell his property at auction to enforce the payment of that fine.

Sadly, this quote is still rings true. The total cost of regulations totaling over $2 trillion in 2012, and as of last spring, there were over 3,300 more federal regulations in queue ready to be handed down from Washington. Likewise, polls continue to show federal regulations as a top challenge facing small business owners across the nation.

It’s clear small businesses need a change. As Election Day nears, it’s time we put candidates in Washington who understand the challenge small business owners are facing and work together to find solutions to these problems.

Read Ronald Reagan’s entire speech here.


Washington Misleading the Country On EPA’s Water Rule

Monday, 27 October 2014

A group of 25 Republican senators led by Sens. John Barrasso (R-Wyo.), Ted Cruz (R-Texas), Mitch McConnell (R-Ky.) and David Vitter (R-La.) joined together to suggest the Administration is misleading the general public about the size and scope of the EPA’s forthcoming Waters of the United States regulation. In light of the upcoming election, the lawmakers claim officials are downplaying the negative impact of the rule for political gain.

According to reports, “In particular, the senators take issue with the administration’s position that the rule responds to previous requests for a Clean Water Act rulemaking and accuse officials of ‘insinuating that opposition to the proposed rule is equivalent to opposition to clean water.’ Further, they charge that the EPA has sought to ‘delegitimize’ concerns about the proposed rule, while misrepresenting the likely impacts of the rule.”

Read more here.


EPA proposal would handicap small business

Tuesday, 21 October 2014

NFIB-Ohio’s Executive Director Roger Greiger penned a letter to the editor in The Columbus Dispatch about how EPA’s proposed expansion to the Clean Water Act would negatively affect small businesses in Ohio and across the country. The EPA is considering changing the definition of navigable waters to expand the agency’s jurisdiction over small bodies of water, including farm ponds, seasonal streams, and puddles.

According to Greiger, “Small businesses would be those most affected by these regulations, and they feel the EPA should spend less time posing with environmentalists and spend more time reaching out to explain how the agency arrived at the notion that it has the authority to implement these rules. If the EPA were to reach out to small businesses, many would point out that the proposed rules do nothing to clarify the definition of waterways, and instead increase uncertainty over which waters are covered by requiring most waterways to be evaluated case by case.”

NFIB has been actively engaged on this issue. Last week, the organization submitted comments to the EPA, highlighting that the EPA had not followed the Regulatory Flexibility Act, which mandates that agencies consider the impact of a rule on small businesses. The NFIB concluded that this rule “increases regulatory burdens on small business landowners.”

Read the entire letter to the editor here.


Captivity and the Need for Regulatory Flexibility

Monday, 20 October 2014

A big story in the news this week was on “regulatory capture,” a relatively foreign term to many outside the field of economics. NPR aired secretly taped recordings between bank examiners from the New York Federal Reserve and executives at Goldman Sachs, exposing the regulators as timid and deferential to the bankers. The tapes suggest federal regulators had “become more oriented to the institution they are supervising than to representing the public interest.” The very definition of regulatory capture.

More importantly than the standard definition of “regulatory capture,” though, situations like this display the larger, systemic problem of design of institutions.

According to Vox.com, “The scandal is less about Goldman’s behavior and more about the Fed’s inability or unwillingness to uphold the rule of law. Reasonable people can debate whether specific regulations are necessary, but even the best set of rules is totally insufficient if paired with an enforcement system that applies them inconsistently or not at all. Fair and consistent application of regulations is a prerequisite for having a regulatory regime of any kind. When regulators act the way the TAL/ProPublica report show New York Fed regulators acting, it suggests that we need to reform or revamp regulatory institutions before we can expect any new rules they’re charged with enforcing to do much of anything.”

This story raises the question: What is the best way for an agency to ensure industries comply with regulations?

If a federal agency wants to create a rule, they can enforce the rule by A) monitoring the industry through each step to reach the desired outcome or by B) ensuring that the industry achieves the outcome. In the Goldman Sachs story, the Federal Reserve followed the first option, and the agency’s rigged, time-consuming process of monitoring became an institutional problem, susceptible to the influences of the bankers.  Examples like this, therefore, appear to give credence to the need for greater flexibility within the regulatory process; an approach more like option B.

Endemic problems of regulatory capture should remind us that the outcome of a regulation is more important than the process or means of regulating. As a result, flexibility in pursuit of the right outcomes should be a virtue for the regulated and regulators alike.


NFIB Files Comments on the Clean Water Act

Thursday, 16 October 2014

The National Federation of Independent Business (NFIB) filed comments with the Environmental Protection Agency (EPA) this week about the controversial expansion to the Clean Water Act. The new rule, which extends the agency’s authority over streams, farm ponds, and puddles, will be particularly troublesome for small businesses and farmers.

According to the comments, “Landowners will be more hesitant to engage in development projects or to make other economically beneficial uses of their properties.”

Read NFIB’s comments here.  


Colorado Small Businesses and Manufacturers Discuss the Growing Burden of Federal Regulations with Congressman Tipton

Tuesday, 21 October 2014

For Immediate Release                                                                                 October 21, 2014                                                                                                                                                                  

Colorado Small Businesses and Manufacturers Discuss the Growing Burden of Federal Regulations with Congressman Tipton 

New Study Finds Federal Regulations Cost the Economy $2 Trillion Annually

GRAND JUNCTION, COLORADO –The National Federation of Independent Business (NFIB) and Club 20 met with dozens small businesses and manufacturers to discuss the growing burden of federal regulations with Congressman Scott Tipton (R-3) at Leitner-Poma, a local aerial lift manufacturing company. The event explored the findings of a new national study on regulations, conducted by Lafayette College economists Nicole V. and W. Mark Crain for the National Association of Manufacturers, that found federal regulation costs the American economy $2.028 trillion in lost economic opportunity each year.

“In order to keep America competitive, we must work towards a less cumbersome federal rule-making process. Federal regulations, we can all attest, are essential to help safeguard our communities and our businesses. However, the current federal process is broken,” said Congressman Scott Tipton. “We cannot have a regulatory system that costs over $2 trillion and not expect this to impact economic growth across the country.”

According to the study, small businesses and manufacturers are disproportionately impacted by federal regulations. The average cost per employee that a small business must pay to comply with federal regulations is now $11,724 a year, while small manufacturers pay an astounding $34,671 per employee per year.

Tony Gagliardi, NFIB-CO state director, added, “Business owners from across Colorado approach me with the same story:  outdated and duplicative regulations are handcuffing their ability to grow.  With over 3,300 regulations in the pipeline, is it any wonder that small business owners feel their voices aren’t being heard in Washington?   We applaud Congressman Tipton for understanding the regulatory burdens facing small businesses in our state and actively working to change the process.”

“The new study gives credence and a measurable proof to the growing regulatory burden manufacturers face,” said XX, president of Club 20. “These job-creators look to Washington to implement smarter regulatory policies, ensuring that our community is preserved, and avoiding roadblocks to economic growth. We need to find a better balance.”

According to Rick Spears, CEO of Leitner-Poma, “As a manufacturer in Colorado, our company takes pride in creating safe products in a safe environment. Sadly, federal rules have become an obstacle to our success. Regulations are not the problem, rather it is the arbitrary and confusing rule-making process. Regulations impact small manufacturers on a much larger scale than any reasonable person could understand, and as a result, we are left with fewer resources to grow and expand our companies.”


EPA proposal would handicap small business

NFIB-Ohio’s Executive Director Roger Greiger penned a letter to the editor in The Columbus Dispatch about how EPA’s proposed expansion to the Clean Water Act would negatively affect small businesses in Ohio and across the country. The EPA is considering changing the definition of navigable waters to expand the agency’s jurisdiction over small bodies of water, including farm ponds, seasonal streams, and puddles.

According to Greiger, “Small businesses would be those most affected by these regulations, and they feel the EPA should spend less time posing with environmentalists and spend more time reaching out to explain how the agency arrived at the notion that it has the authority to implement these rules. If the EPA were to reach out to small businesses, many would point out that the proposed rules do nothing to clarify the definition of waterways, and instead increase uncertainty over which waters are covered by requiring most waterways to be evaluated case by case.”

NFIB has been actively engaged on this issue. Last week, the organization submitted comments to the EPA, highlighting that the EPA had not followed the Regulatory Flexibility Act, which mandates that agencies consider the impact of a rule on small businesses. The NFIB concluded that this rule “increases regulatory burdens on small business landowners.”

Read the entire letter to the editor here.


NFIB Files Comments on the Clean Water Act

Thursday, 16 October 2014

The National Federation of Independent Business (NFIB) filed comments with the Environmental Protection Agency (EPA) this week about the controversial expansion to the Clean Water Act. The new rule, which extends the agency’s authority over streams, farm ponds, and puddles, will be particularly troublesome for small businesses and farmers.

According to the comments, “Landowners will be more hesitant to engage in development projects or to make other economically beneficial uses of their properties.”

Read NFIB’s comments here.  


NFIB Small Business Jobs Report

Monday, 13 October 2014

Small business job creation plans faded in September, according to the newly released NFIB Small Business Optimism Index. Moreover, the report, which surveys over 600 small business owners across the country, suggested potentially weaker job creation in the coming months.

According to NFIB Chief Economist William Dunkelberg, “Job creation plans also faded however, suggesting weaker job creation ahead…  The September NFIB data anticipate new jobs in the low 200,000 range and an uptick in the unemployment rate. Reports of past hiring were very strong, suggesting a good jobs number, but job openings and job creation plans faded, casting a shadow over the job market outcomes.”

Check out the entire survey here.


EPA welcomes more comments on water regs

Monday, 6 October 2014

The EPA announced this week that the agency is extending the comment period for the controversial Clean Water Act rule, which would give agencies a greater authority to regulate water, including small farm ponds and ditches. This is the second extension the agency has granted to the comment period and will now run through November 14.

According to reports, “The EPA’s Scientific Advisory Board is wrapping up a report on the connectivity of small bodies of water such as streams and wetlands, the agency noted, and the EPA wants to give the public more time to comment on the results of the report once it is released.”

Read more about the extension here.


Former Senator Blanche on MSNBC’s Jansing and Co.

Friday, 14 September 2012

Former Senator Blanche Lincoln appeared on MSNBC’s Jansing and Co. to discuss regulations and the economy.

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