Leading Trends #3 - The Unbearable Cost of Overregulation
by Utah Attorney General Mark Shurtleff
Aug 16, 2012 | 1548 views | 2 2 comments | 7 7 recommendations | email to a friend | print
The continuing trend of excessive regulation will sharply retard U.S. economic growth. Unless we dial over-regulation back, this country will pay a heavy price. "The home of laissez-faire is being suffocated by excessive and badly written regulation" according to the Economist. They continue, "Consider the Dodd-Frank law of 2010. Its aim was noble....But Dodd-Frank is far too complex, and becoming more so. At 848 pages, it is 23 times longer than Glass-Steagall, the reform that followed the Wall Street crash of 1929. Worse, every other page demands that regulators fill in further detail.

The regulations for the Affordable Care Act will run into the hundreds of thousands of pages. Hospitals, clinics, and doctors will have to review and implement expensive changes. The EPA is cranking out very restrictive regulations, some of which exceed statutory authority and take policy positions not addressed in governing legislation.

So why are we getting so much regulation? Politics and lobbying, lazy lawmakers, and overly zealous administrators.

Politics and Lobbying

Lawmakers are elected to turn their policy ideas into legislation. When they stir too much of their political policy into the existing rubric of laws and regulations and market economics, you get a thick, distasteful, and harmful stew. Consider also the potent influence of lobbying groups wanting laws favoring their members. For instance, many groups have sought licensing and regulations to "protect the public." Or are they really just trying to limit competition by erecting a high bar to entry?

Lazy Lawmakers

In the last decades, Congress began making laws expressed in conceptual but legally vague terms knowing that regulations or court cases would define the specifics of the law. So they punt the cost of their fuzzy thinking or their legally sloppy work to the public, who must either comply with ridiculous, burdensome regulations or litigate at great cost against a government with a bottomless supply of lawyers. The PPACA calls into existence countless new federal agencies, all of which will have to define their mission by writing new regulations. Regulations are sometimes appropriate. But in my opinion, Congress has unconstitutionally delegated legislative power to bureaucrats.

Overzealous Regulators

Regulators like to regulate; that's what they do. Once you begin to draw fine lines around things, it's almost impossible to stop. The laudable goal of a wheelchair-accessible environment becomes ridiculous and costly when regulation requires modification of sidewalks where a wheelchair never has and never will come. Regulators don't face election, and they have jobs for life. Congress hardly ever reins them in, so what's to prevent them from implementing their own version of policy.

Over-sophistication of the Law

There is an entire domain in which we must regulate ourselves. As we pile law upon law, their burden soon stifles business and living, warping markets and hurting the people they’re meant to protect. If we don’t cooperate in getting out of a parking lot after a football game, we must hire more police, develop more rules, etc. We cannot nor do we want to legislate everything. It is the absolute necessity to render “obedience to the unenforceable….” John Fletcher Moulton.

I hope lawmakers will wake up and see what they and their regulatory agencies are costing America.

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August 18, 2012
The Unbearable Cost of Underregulation

Your narrative makes NO GOD DAMN SENSE! Are you blind & deaf? Have you been living under a rock for two decades? The current economic pain hundreds of millions of Americans have felt for years were triggered by removing NECESSARY regulations from banks. We’ve been through this pain before, those regs were made to prevent this!

The corrupt private incentive to profit by harming everyone else is too great. Too many people are happy hurt others. The sum of the harm they do to everyone else exceeds their own private profit, making our whole society net poorer.

The core problem with your regressive thinking process is that selfishness is not morally justifiable, and produces worse outcomes than cooperation.

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August 17, 2012
Another example is the Foreign Accounts Tax Compliance Act (FATCA) which threatens to shut down all foreign investment and other global financial exchanges in/with the USA. For more information go to http://www.ey.com/GL/en/Industries/Financial-Services/Banking---Capital-Markets/FATCA--resources
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