Here are some compromise solutions that political parties are ignoring. Obviously, congressional Republicans
are resisting any solution that the administration might claim credit for
during the next election cycle. Regardless, here are some ideas that we
can advocate.
Regulations are an important function of government. The division is where the line is drawn between justified regulations and excessive intrusion. Special interests, cost/benefits, long term
effects and real need are all valid concerns.
Here are several facts that must be included in any regulatory discussion. Please be aware that this entire topic is complicated and often intentionally made confusing by political interests.
1. The environment surrounding regulations is probably one
of the greatest targets of lobbyists. Powerful interests watch regulations like a hawk.
2. Every administration creates and/or modifiesthousands of regulations. The present administration has written
fewer regulations than the Bush administration for the same time span but
the costs estimates are far higher than the regulations under the Bush administration.
3. Estimates of "cost" from the Congressional Budget
Office, CBO, are required to use the data provided by Congress regardless
of the accuracy or sensibility. Typically the CBO will also "lean"
towards the prevailing political party when they come up with their
estimates of costs, revenues, etc.
4. The president and his party can affect the actual
implementation of regulatory policy by appointing administrators that will
follow White House policies regardless of existing, defined rules.
The Federal Reserve, Security Exchange Commission, Justice Department
anti-trust division and the National Labor Relations Board is a
typical examples of administrative polices placed into action without
specific written regulations.
5. Businesses, small and large, have been most vocal and
consistent in their message that the high level of regulatory uncertainty
is a major reason to delay expansion that would help reduce unemployment.
6. Many proposed regulations address environment and
health, financial reforms and business reporting and restrictions.
The previous (Bush) administration greatly cut back EPA regulations and
refused to prosecute violations even when evidence was irrefutable. Now
the pendulum is swinging in the other direction. Some of the
business and financial regulations address abuses by those interests while
other regulations are more punitive in nature.
7. Corporate mergers and acquisitions are often expensive
for the public. As companies are bought out at enormous costs the
end users usually end up paying higher prices and/or lower services, or
both. For years corporate raiders took over companies and split them
up into different companies or sold divisions off thus costing thousands
of jobs all in the name of profits.
Discussion:
Federal regulations are absolutely essential!
Without reasonable regulations our national environment would become a
"wild west" of special interests victimizing anyone standing in their way
of increased profits, power and control. On the other hand,
regulations can often be used to burden, punish and/or restrict individual
freedoms.
Past efforts to de-regulate has led to disastrous, unintended
results. For example, in the 1980' and 1990's the Savings and Loan
deregulations led to wide-spread failures resulting in $87.9 billion in
bailouts. So, what did we learn from this? Nothing!. A
few years after the dust cleared, Congress began deregulating banks.
The 2008 economic crash was either caused by or greatly aggravated by
those deregulations.
With over 4,000 regulations in the works it's
impossible to address all of them. While researching the regulation
issue it was difficult to get a lot of specifics. The opposition is
most vocal while the supporters seem to be keeping a relatively low
profile on specifics. Below, we are presenting a number of Internet
sources on the subject.
Bernie Marcus, Fox news 11/04/11, 13:26 minutes (Co-founder of Home
Depot)
Obama administration moves to cut unneeded regulations
Small business owners seek 'sensible regulations
Small Business Owners Speak Out Against Job-Stifling Government
Regulations
Government Regulations Prevent Job Growth (NLRB)
Example of
uncertainty: private room for breast feeding mothers
Policy Uncertainty Is Choking Recovery - Bloomberg News
Obama Tax Loopholes to close
10
Giant Loopholes Re: corporate tax breaks
Bernie Marcus, Home Depot co-founder & Steve Wynn on Business
Frustration
Bernie Marcus on
CNBC: About Job Creators Alliance.
Bernie Marcus on
CNBC: about Getting America back to work
Bankers’ Objections to Volcker Rule Fail on the Merits
Regulations are expensive for both the
government and businesses. The following is from the
Job Creators Alliance:
The U.S. ranks 49th in regulatory competitiveness, well
behind China and other competitors.
The federal government issued 3,573 final rules in 2010
alone. These rules totaled nearly 25,000 pages, up 20% from 2009.
Regulations cost the U.S. economy more than $1.75
trillion in 2008, equivalent to $15,500 per household. Regulatory costs
per employee are 36 percent higher for small businesses than for large
firms.
Regulation costs the economy nearly twice as much as
Americans paid in 2010 individual income taxes.
Regulatory costs represent almost 12% of U.S. Gross
Domestic Product.
Corporate takeovers and mergers need closer scrutiny to prevent
damage to employees and the economy on the whole. If customers
and/or the public will be charged more to cover excessive take-over costs
the transaction should be denied.
Summary:
The federal government spent $52 billion in 2010 to administer and enforce
regulations and that number is rising every year. Over the last decade,
regulatory spending rose 70% more (adjusted for inflation). Regulatory
spending is expected to reach nearly $55 billion by the end of this year.
The
Glass–Steagall
Act from 1934 greatly restricted what instruments banks could invest
in. As Glass-Steagall was dismantled over the years the nation's
financial environment became more volatile and, frankly, more dangerous.
Consumer protection and national stability require sound regulations.
Burdensome and punitive regulations damage our economy and drive business,
with their jobs, overseas!
There are a number of regulations and restraints needed
in our financial markets. High-speed trading and trading rules have been
liberalized since the markets have been privatized to the point that the
individual investor is at a real and significant disadvantage. This
topic is very technical and not to be covered further at this time.
Suggestions to Improve Managing Regulations:
Preface:
Government regulations, as currently applied, frequently serve special
interests and often hurt the economy. We need a more objective
method of evaluating the need of and effect of regulations. Specific
reasons and/or need for a new or revised regulation must be clearly stated
by the sponsors and made available to the public.
1. No regulation should be passed by
Congress without a full disclosure of the terms and conditions.
There would be no assignment to define the rules after the fact and out of
sight in various departments that are generally bound to the current
political party.
2. Each affected industry and interest
group should nominate a select of panel of experts with practical
knowledge of the areas needing regulation. As with the suggestion
under "Taxes" this group should be large and meet in privacy.
3. Each challenged regulation would be reviewed
and discussed apart from political interests and lobbyists. Leaking
elements of the discussions and attempts to influence panel members would
be strictly prohibited by law.
4. Regulations need to be subject to "Sunset
Laws" where they will expire without further Congressional action.
5. Until a regulation is fully defined and
published it will not be enforceable and an effort to retroactively
enforce such rules & regulations would be subject to "ex post facto"
limitations.
6. No future legislation shall redefine
elements of any prior law or regulation without a full disclosure of the
effect on other elements of law. (Ref. hidden changes included in
H.R. 3 earlier this year.)
7. An economic impact and/or environment
impact must be determined before new or modified regulations can be
considered or passed.
8. (Important) The United States is a
consuming nation. We must take a stand on the quality allowed
for imports to our country! Our current FDA and other regulations
place far stronger controls on our own food producers and other suppliers
than on
foreign imports.
If Japan, a favored trading partner, chooses to ban
U.S. beef just because we detected one cow with mad cow disease that
came in from Canada (which our procedures did discover) then we must also
consider enforcing comparable standards for all
nations wishing to supply us! We need to ban all products containing
unacceptable levels of lead,
arsenic, pesticides and
filth.
If another country want to do business with us they must do it our way!
9. Over-regulation and excessive
paperwork can kill local fruit and vegetable growers that we frequent at
our local farmers' market. The recently passed FDA Food Safety
Modernization Act (FSMA) while stepping up enforcement powers it also
places enormous regulatory burdens on small producers who are seldom the
source of contamination. We need a reasonable balance and
consideration rather than blanket policies that hurt small businesses.
10. Finally, We must keep the government, and
their administrators, from micro-managing an ever expanding realm of our
lives! Likewise, we must keep the government from rendering special
conditions to favored lobbyists or campaign contributors. Many
regulations are punitive and unnecessary. Many existing regulations are
inadequate and fail to protect Americans. Politics and Congressional
favoritism is the real "ground zero" whether regulations are written to
favor the few or funding is withheld to adequately enforce good
regulations. These issues apply across the board whether it's the
EPA, FDA, financial markets, banking and financial special
interests.
Beneath all the political verbiage there
are significant, ignored facts and considerations that we need to be aware
of. And, this is what Fogcutters is all about.
Fogcutters.net
- Finding Where Truth Hides
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