Archive for the ‘Regulations – Regulatory State’ Category
HERITAGE FOUNDATION-JAMES GATTUSO: Hindsight is supposed to be 20/20, but looking back on the past 12 months, it’s tough to see any sense in many of the Administration’s regulatory missteps. Of course, there are bound to be a few howlers when government churns out more than 3,500 rules in a year, including dozens unleashed by Obamacare, Dodd–Frank, and the perpetually errant Environmental Protection Agency (EPA). But by any standard, 2011 brought forth a remarkable number and variety of regulatory blunders.
Fair warning: Our Top 10 list may prove fatal to any bit of faith in government as a “fixer,” if faith somehow has managed to survive despite all evidence to the contrary. In any event, it should steel our resolve to fight the Leviathan in the coming year.
1. The Dim Bulbs Rule. As per Congress, of course, for issuing an edict to phase out the incandescent light bulbs on which the world has relied for more than a century. With the deadline looming in 2012, Americans by the millions spent the past year pressing lawmakers to lift the ban which, contrary to eco-ideology, will kill more American jobs than create “green” ones. (Congress evidently overlooked the fact that the vast majority of fluorescent bulbs are manufactured in China.) The 2012 appropriations bill barred the use of funds to enforce the regulation, but it remains in law.
2. The Obamacare Chutzpah Rule. The past year was marked by a slew of competing court rulings on the constitutionality of the individual mandate, the cornerstone of Obamacare. The law requires U.S. citizens to obtain health insurance or face financial penalties imposed by the Internal Revenue Service. Never before has the federal government attempted to force all Americans to purchase a product or service. To allow this regulatory overreach to stand would undermine fundamental constitutional constraints on government powers and curtail individual liberties to an unprecedented degree.
3. The Nationalization of Internet Networks Rule. Regulations that took effect on November 1 prohibit owners of broadband networks from differentiating among various content in managing Internet transmissions. (In other words, the Federal Coercion Communications Commission effectively declared the broadband networks to be government-regulated utilities.) The FCC imposed the “network neutrality” rule despite explicit opposition from Congress and a federal court ruling against it. The rule threatens to undermine network investment and increase online congestion.
4. The Equine Equality Rule. As of March 15 (the Ides of March, no less), hotels, restaurants, airlines, and the like became obliged to modify “policies, practices, or procedures” to accommodate miniature horses as service animals. According to the Department of Justice, which administers the rule, miniature horses are a “viable alternative” to dogs for individuals with allergies or for observant Muslims and others whose religious beliefs preclude canine accompaniment.
5. The Smash Potatoes Regulation. The U.S. Department of Agriculture proposed stricter nutrition standardsthat would prohibit school lunch ladies from serving more than one cup per week of potatoes per student. Instead, schools would be required to provide more dark green, orange, and dry bean varieties (think kale) in order to foster vegetable diversity. The cafeteria mandate will affect more than 98,000 elementary and secondary schools at a cost exceeding $3.4 billion in the next four years.
6. The Bring on the Blackouts Rule. The EPA is proposing to force power plants to reduce mercury by 90 percent within three years—at an estimated cost of $11 billion annually. A significant number of coal-fired plants will actually exceed the standard—by shutting down altogether. Indeed, grid operators, along with 27 states, are warning that the overly stringent regulations will threaten the reliability of the electricity system and dramatically increase power costs. Just like candidate Obama promised.
7. The Wal-Mart Windfall Amendment. One of hundreds of new regulations dictated by the Dodd–Frank financial regulation statute requires the Federal Reserve to regulate the fees that financial institutions may charge retailers for processing debit card purchases. The prospect of losing more than $6 billion in annual revenue is prompting financial institutions to hike fees on a variety of banking services to make up for the much smaller payments from stores. Thus, consumers are picking up the tab for retailers’ big regulatory score.
8. The Plumbing Police Rule. The U.S. Department of Energy began preparations for tightening the waterefficiency standards on urinals. It’s all spelled out in excruciating detail in the Energy Conservation Program for Consumer Products Other Than Automobiles, which also regulates the efficiency of toilets, faucets, and showers. And refrigerators and freezers, air conditioners, water heaters, furnaces, dishwashers, clothes washers and dryers, ovens and ranges, pool heaters, television sets, and anything else the Energy Secretary deems as electrically profligate. (Urinals also are regulated by the Occupational Safety and Health Administration, which requires at least one urinal for every 40 workers at a construction site for companies with less than 200 employees and one for every 50 workers where more than 200 are employed. The Americans with Disabilities Act also delineates the proper dimensions and placement of bowls.)
9. The Chill the Economy Regulation. The EPA issued four interrelated rules governing emissions from some 200,000 boilers nationwide at an estimated capital cost of $9.5 billion. These boilers burn natural gas, fuel oil, coal, biomass (e.g., wood), refinery gas, or other gas to produce steam, which is used to generate electricity or provide heat for factories and other industrial and institutional facilities. Under the so-called Boiler MACT, factories, restaurants, schools, churches, and even farms would be required to conduct emissions testing and comply with standards of control that vary by boiler size, feedstock, and available technologies. The stringency and cost of the new regulations provoked an outpouring of protest, including 21 governors and more than 100 Members of Congress. On May 18, the EPA published a notice of postponement in the Federal Register, but the regulations remain on the books.
10. The Unions Rule Rule. New rules require government contractors to give first preference in hiring to the workers of the company that lost the contract. Tens of thousands of companies will be affected, with compliance costs running into the tens of millions of dollars—costs ultimately borne by taxpayers. The rule effectively ensures that a non-unionized contractor cannot replace a unionized one. That’s because any new contractor will be obliged to hire its predecessors’ unionized workers and thus be forced by the “Successorship Doctrine” to bargain with the union(s).
EPA’s avalanche of new climate change regulations will require 230,000 new federal bureaucrats to enforce
And then Obama wonders why U.S. manufacturing is moving overseas along with the jobs.
DAILY CALLER: The Environmental Protection Agency has said new greenhouse gas regulations, as proposed, may be “absurd” in application and “impossible to administer” by its self-imposed 2016 deadline. But the agency is still asking for taxpayers to shoulder the burden of up to 230,000 new bureaucrats — at a cost of $21 billion — to attempt to implement the rules.
The EPA aims to regulate greenhouse gas emissions through the Clean Air Act, even though the law doesn’t give the EPA explicit power to do so. The agency’s authority to move forward is being challenged in court by petitioners who argue that such a decision should be left for Congress to make.
Then Obama wonders why no one’s hiring, economy doesn’t grow
UPI: Waves of new U.S. federal regulations range from “silly” to “serious” as far as restricting job growth, Sen. Susan Collins, R-Maine, said in the party address.
Collins said in the Republican weekly media statement the regulatory push that began under the Democrat administration of Barack Obama is “crushing” efforts to create jobs for 14 million unemployed Americans.
“Right now, federal agencies are at work on more than 4,200 new rules, 845 of which affect small businesses, the engine of job creation,” the senator said. “More than 100 have an economic impact of more than $100 million each.”
YAHOO! FINANCE: Professor Adam Lerrick says, the United States does not have an economic policy–and has not had one since Ronald Reagan was President. Instead, the United States has a social policy, one in which the government’s goal appears to be to spread the wealth earned by the richest Americans to the rest of the country without promoting private-sector growth in the meantime.
Until the government clarifies what its job is and reduces the uncertainty that is hobbling the economy, Lerrick says, the job market will remain weak and growth will be anemic. Lerrick’s “uncertainty” argument is more nuanced than that of other analysts, who blame liberal policies for worrying and confusing the country’s business-people, but his outlook for the economy is similarly gloomy.
FINANCIAL TIMES: George Soros, the billionaire hedge fund manager, is closing his Quantum fund to outside investors and returning their money.
Quantum, which will continue to manage about $24.5bn of Soros family money, blamed the decision on new financial regulations requiring hedge funds to register with the Securities and Exchange Commission.
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“An unfortunate consequence of these new circumstances is that we will no longer be able to manage assets for anyone other than a family client as defined under the regulations”, Jonathan and Robert Soros, Mr Soros’ sons and Quantum’s co-deputy chairmen, wrote in a letter to investors on Tuesday.
New regulations require hedge funds with more than $150m under management to report details about investments, employees and investors, and also makes them subject to possible inspections by the SEC. Mr Soros’ decision contrasts with his own reputation as an advocate for both government and corporate transparency.
Evidence against the Dodd-Frank Act continues to pile up. Now 18 Republican Senators have introduced legislation to repeal the act.
PETER WALLISON-THE AMERICAN: Last week, 18 Republican Senators, led by Jim DeMint of South Carolina, introduced legislation to repeal the Dodd-Frank Act. It’s surprising that it took so long. The evidence against the act continues to pile up.
Where to begin? Here are a few of the major features of the Dodd-Frank Act that raise questions about whether it should remain in force:
• It strips the banking industry of the ability to engage in proprietary trading (the trading of fixed-income securities for the banks’ own accounts), a profitable activity that no one ever claimed had any role in the financial crisis. Removing the entire U.S. banking community from this market will reduce liquidity and widen spreads for all buyers and sellers of these instruments. Ultimately, it will move this business offshore, where foreign banks and other institutions will gain the benefits. No other country has moved to impose such a restriction on its own banks.
• It authorizes a group of regulators, the Financial Stability Oversight Council, to designate certain large financial institutions—insurance companies, insurance holding companies, securities firms, banks, bank holding companies, hedge funds, finance companies, and others—as potential causes of financial stability and thus too big to fail. This would give these companies major competitive advantages over smaller companies, particularly in funding costs, and forever change the competitive nature of our financial system.
CAROLINE BAUM-BLOOMBERG: The president’s efforts, including his capitulation on an extension of the Bush tax cuts for all Americans, have paid off. His approval rating jumped to 49.8 percent this month, up from 45.6 percent at the time of the election, according to the Real Clear Politics average.
So is this just a public relations gambit designed to win back independents and assuage business concerns to ensure money and votes in 2012?
Of course it is. The real question is will there be any follow-through?
A careful reading of Obama’s words suggests he’s still stuck in a central-planning mindset. Obama introduces each new appointee as someone who knows how to “grow the economy” and create jobs. The president has been pressing his economic team to come up with job-creating ideas “that excite me,” according to Peter Baker’s cover story in the New York Times Magazine on Sunday.
Conflict of Interest
Clearly the 3.5 million jobs “created or saved” by Christy Romer’s econometric model (Romer was chairman of the president’s Council of Economic Advisers until September) didn’t convince anyone. Now Obama wants real jobs, more than the 1.3 million private-sector positions created in 2010, to buy him real votes.
Of course, Obama could have elevated Richard Trumka, president of the AFL-CIO, from his economic advisory committee to the top spot instead of Immelt, who has regular business before the administration and received a $16.1 billion Federal Reserve bailout in 2008. But why create the appearance of conflict of interest?
Obama doesn’t need any more advisers to tell him the U.S.’s 35 percent corporate tax rate, among the highest in the world, puts the nation at a competitive disadvantage. Or that taxing overseas profits when they’re repatriated to the U.S. doesn’t encourage businesses to bring that money home and invest here.
On the regulatory front, Obama’s intention to submit all federal rules and regulations to a cost-benefit analysis sounds nice, but what bureaucrat has ever declared himself redundant and written himself out of a job?
It reminds me of a joke about the tourist who goes to visit the Agriculture Department. As he’s walking down a long, empty hallway, he hears the sound of crying coming from an office. The tourist peaks his head in and asks the employee, sobbing at his desk, “What’s the matter?”
“My farmer died,” the employee replied.
The Department of Agriculture, like any government agency, never willingly cedes a part of its fiefdom.
In the 1700s, the U.S. was an agrarian nation with 90 percent of workers engaged in farming, according to Veronique de Rugy, senior research fellow at George Mason University’s Mercatus Center in Arlington, Virginia. Today the U.S. economy has highly productive agribusinesses employing less than 2 percent of all (legal) workers. Yet “the federal government continues to subsidize agriculture,” de Rugy said. “Spending for the Department of Agriculture in real terms went from $95 billion in 2000 to $142 billion in 2010.”
Obama’s major legislative initiatives — health care and financial reform — left it to regulators to write the rules necessary to implement the laws. To order a review of federal regulations in the face of so many to-be-written laws is talking out of both sides of your mouth.
So nice try, Mr. Obama. You’ll have to do better than executive orders and executive appointments to convince us you have the wherewithal of a business executive.
STEVEN MALANGA-WASHINGTON EXAMINER: Next week President Obama will deliver the annual State of the Union address, which outlines his legislative agenda for the year, to a new Congress with one house controlled by Republicans. Still, the president remains in command of a powerful tool to continue pursuing his own agenda, namely the broad rule-making powers that federal agencies under his direction wield.
For starters, the Obama administration’s signature new laws—Obamacare, signed last spring, and the Dodd-Frank financial-reform act, which became law in July–will require a blizzard of new rules from myriad agencies responsible for enforcing them.
Already, the Internal Revenue Service and the Departments of Labor and Health and Human Services have promulgated more than 1,000 pages of rules related to the health-care act, and the total will reach more than 10,000 pages, estimates Inside Counsel, a magazine for corporate lawyers.
Yet another head fake for 2012? Obama admits capitalism is “the greatest force for prosperity the world has ever known”
Then most of his article is one long list of “buts”
BEN SAYS: I must say, this is a huge admission for Obama. This is the first time I’ve ever heard him give even one cheer for capitalism. This might be one-and-and-half cheers for capitalism. If Obama actually did what he says he wants here, I would need to change the name of this site from Escape Tyranny to a much less zesty-sounding Reduce Unnecessary Regulations.
But Obama has show himself in his first two years to be all about running ever aspect of our lives. You can have tyranny through excessive regulations — tyranny by the bureaucracy. ObamaCare creats 159 brand new government agencies and provides for the hiring of 16,000 brand new IRS agents to harass us. We now live under a kind of bureaucratic despotism that has smothered the spirit of entrepreneurship in America. I hope Obama is changing his stripes.
But I really doubt it. He needs a decent economy to get re-elected. And he needs to show the voters that he really doesn’t hate capitalism. He wants us to completely forget all he’s been doing these past two years to destroy capitalism in America.
Here’s Obama’s Article in Today’s Wall Street Journal
BARACK OBAMA-WALL STREETT JOURNAL: For two centuries, America’s free market has not only been the source of dazzling ideas and path-breaking products, it has also been the greatest force for prosperity the world has ever known. That vibrant entrepreneurialism is the key to our continued global leadership and the success of our people.
But throughout our history, one of the reasons the free market has worked is that we have sought the proper balance. We have preserved freedom of commerce while applying those rules and regulations necessary to protect the public against threats to our health and safety and to safeguard people and businesses from abuse.
From child labor laws to the Clean Air Act to our most recent strictures against hidden fees and penalties by credit card companies, we have, from time to time, embraced common sense rules of the road that strengthen our country without unduly interfering with the pursuit of progress and the growth of our economy.
Another pre-2012 head fake? Obama signs executive order against cumbersome and “dumb” government regulations
BEN SAYS: Given ObamaCare and its 159 new government agencies, the hiring of 16,000 new IRS agents, EPA’s crackdown on business, the mammoth Financial Deform Law, the federal takeover of most of the banking system, the FCC’s threats to use its regulatory power to shut down conservative radio, Obama’s lawsuits against “right to work” states, Obama’s lawsuit against Arizona, the ban on Americans (but not foreigners) drilling for oil offshore, and Obama’s seizing control of the Internet, it’s tough to take this Executive Order seriously.
JAKE TAPPER-ABC NEWS: President Obama today will sign an executive order to make clear the operating principle of the US government is to strike the right balance with regulations, neither “placing unreasonable burdens on business—burdens that have stifled innovation and have had a chilling effect on growth and jobs” nor failing to “protect the public interest.”
The president made the announcement in an oped in the conservative opinion pages of the Wall Street Journal, in yet another sign his move may be based in part in moving towards the political center (or at least being perceived as doing so.)
The administration, the president writes, is “making it our mission to root out regulations that conflict, that are not worth the cost, or that are just plain dumb.”