Former Senator Blanche Lincoln, currently heading an anti-regulatory campaign called “Small Businesses for Sensible Regulation,” appeared on CNBC on Friday to make her case. Lincoln’s been busy trying to use different iterations of a debunked SBA report claiming astronomical costs for regulations. This time she skipped that piece, but offered this take (at 3:15):
This is the single most important issue to small businesses. It’s the biggest threat. The compliance with government regulations that don’t make sense, that cost ‘em money, and keep ‘em from creating jobs is the biggest problem they’ve got.
But even the staunchly right-wing, anti-regulatory National Federation of Independent Businesses, which proudly sponsors the campaign Lincoln heads, finds otherwise in their own surveys of their members (business owners that represent a share – but not exactly the full spectrum – of the small business sector). NFIB’s latest survey has “poor sales” topping the list of its members’ concerns, at 26 percent, with “govt regs & red tape” below it at 19 percent (page 20).
Other polling has found lower numbers than 19 percent. Small Business Majority commissioned Greenberg Quinlan Rosner Research to poll small business owners this summer, and found:
Full textEconomic uncertainty and rising costs are hurting small business more than taxes and regulation: Despite rhetoric that regulation and taxes are the primary obstacles for small businesses, only 13% of owners believe regulation is the biggest problem, and only 23% report that taxes are a problem. In contrast, nearly half (46%) believe their small business is hurt by economic uncertainty and 43% suffer from rising costs of doing business.
If I didn’t know better, I’d think Blanche Lincoln was trying to fool us. The former Senator currently heads the National Federation of Independent Business’s anti-regulatory campaign, and is in DC today to push for a freeze on new regulations. For her accompanying op-ed in Politico, how would she make the case that regulations are a huge problem?
Back in August, Lincoln wrote that regulations cost the U.S. economy $1.75 trillion a year, according to a report commissioned by the Small Business Administration in September 2010. But that study was thoroughly debunked, by a CPR paper, by the Congressional Research Service, and by the Economic Policy Institute.
Two people, CPR President Rena Steinzor and Public Citizen President Robert Weissman, specifically criticized Lincoln’s use of the thoroughly debunked number. In a subsequent post, Lincoln didn’t mention “$1.75 trillion” but instead wrote: “Currently, federal regulations are draining nearly 12 percent of U.S. GDP annually.” That figure, I noted at the time, was simply a different way of reporting the same statistic from the same debunked SBA report.
So what’s Lincoln’s new stat? Her op-ed today has no mention of $1.75 trillion, or 12 percent of U.S. GDP. But it has this:
Regulation has had a disproportionately negative impact on small businesses. Smaller firms pay 37 percent more in compliance than their larger counterparts.
Straight out of the highlights of the SBA report. I wonder, how will Lincoln repackage this debunked study next?
Full textIf you were an industry lobbyist working to block new health and safety protections, what would make your job easier? How about if the law said that you could flood an agency with alternate regulatory proposals, and the agency wouldn’t just need to consider each one, but in fact conduct a full cost-benefit analysis on them all? That would probably be an effective way to tie up the agency quite nicely, and block it from getting its work of protecting the public done.
And that’s exactly what one of the provisions in the “Regulatory Accountability Act,” the subject of a hearing at the House Judiciary Committee this morning, would do. The bill would require an agency to do a cost-benefit study for “any reasonable alternatives for a new rule or other response identified by the agency or interested persons.” That’s just the tip of the iceberg. Point is, if you want to bog agencies down, this one’s for you.
CPR Member Scholar Sidney Shapiro will be testifying at the hearing. Among the points in his testimony:
This bill is no regulatory accountability program.
Full textMember Scholar Robert Adler had an op-ed in the Salt Lake Tribune over the weekend noting a new survey in Utah showing state residents valuing both a sound economy and a healthy environment as fundamental, co-equal requirements of their quality of life. The survey was part of a "Quality of Life Index" from the Utah Foundation, a group supported by many top businesses in the state.
Adler explained the bigger picture:
Fortunately, clean air and water are not incompatible with jobs and a healthy economy. In the four decades in which the Clean Air Act has been implemented, air pollution in the United States has been reduced by 63 percent while the economy has grown by 210 percent and the nation has created 60 million jobs. Many business people in Utah understand that bad air and dirty water are bad for both quality of life and for business.
Read the full op-ed here.
Full textToday the House is taking up debate on the “TRAIN Act”, a sweeping anti-regulatory bill that would serve to gum up the works at agencies that work to protect our health and the environment.
The bill was bad to start with; then it became a true circus, with all sorts of regulation-blocking amendments being tacked on (See NRDC, and NRDC). An amendment offered by Rep. Bob Latta (R-OH) would completely rewrite the Clean Air Act, forcing the EPA to set National Ambient Air Quality Standards (NAAQSs) based partly on what is best for industry’s bottom line, rather than what is best for public health. With this change, Americans would never know whether the air they are breathing is truly healthy.
The base bill requires the EPA to conduct a new detailed study of the various economic impacts of several of its rules. The study elements range from duplicative to impossible. Duplicative, because the economic impacts of the individual rules have already been studied. Impossible, because TRAIN would also require analysis of the cumulative impact of rules on the power industry far into the future, requiring unknowable information: the cost of energy in 20 years; how regulations that haven’t even been written yet will indirectly affect jobs; and so on. The primary goal: paralysis by analysis.
Removed from the discussion, purposefully of course, is any discussion of the benefits of the rules.
The White House’s Statement of Administration Policy threatening a veto rightly noted that the bill requires “costly, unnecessary, and redundant reports.” For more on the TRAIN Act, see CPR President Rena Steinzor’s testimony on the bill from its legislative hearing in April.
Full textCPR Member Scholar David Driesen has an op-ed in this morning's Syracuse Post-Standard discussing the Administration's punt on the smog standard, arguing it's "unfortunate that President Obama has decided to embrace the Republican narrative about regulatory burdens instead of explaining the true causes of our economic woes."
Remembering the role of financial deregulation in our economic crisis, Driesen writes:
The lesson is that we need government standards to safeguard the economy, just as we need them to safeguard the environment. But government bashers have mounted a campaign to create a different narrative — a diversion — blaming economic weakness not on deregulation and reckless financial institutions, but on government regulation.
By defending his withdrawal of the anti-smog standard as a measure to reduce economic burdens, Obama lends authority to this ongoing campaign to render government incapable of establishing adequate standards to protect the economy or the environment. Rampant speculation, diminished public health and destruction of natural resources, however, do not a strong economy make.
Check out the full op-ed here.
Full textSenator Susan Collins announced last week the “Regulatory Time-Out Act” (S. 1538), which would put a one-year moratorium on most “economically significant” regulations. On Monday, she said she had 16 other Senators on board – all Republicans. So while I’m not under any illusion this is going anywhere, one point jumped out at me for discussion.
One of Senator Collins’ top targets in the past year has been the boiler MACT rule, which would require certain facilities to reduce their emissions of mercury, soot, lead and other pollutants that harm our health. At first glance, it appears this bill would serve to delay the boiler MACT rule even further than it already has been. (How a 12-month delay, starting presumably sometime during the current 10-month delay, adds up to being the exact right fix is anyone’s guess, and it’s also not clear how this would reduce “uncertainty.”)
But consider this. Collins’ press release says: “The moratorium would not apply to rules that address imminent threats to human health or safety or other emergencies, or that apply to the criminal justice system, military or foreign affairs.”
It may have been meant as a throw-away line to make the bill sound more reasonable. But the proposed boiler MACT, in its most recent form, would prevent 2,600 to 6,600 deaths per year. Are 2,600 to 6,600 preventable deaths each year caused by pollution from industrial boilers not an imminent threat to human health? How many more people would need to die for it to be an imminent threat to human health?
Full textFormer Senator Blanche Lincoln, now heading the National Federation of Independent Business’s new anti-regulatory campaign, faced criticism in recent days for citing the debunked SBA study claiming regulations cost $1.75 trillion in a year. The NFIB used that stat last week in launching its campaign (see ThinkProgress), and Lincoln cited the number in a National Journal forum post on Monday:
While some federal regulations are important, it costs the U.S. economy a staggering $1.75 trillion a year to comply with them, according to a report commissioned by the Small Business Administration last September.
Two respondents on the forum, CPR President Rena Steinzor and Public Citizen President Robert Weissman, specifically criticized Lincoln’s use of the thoroughly debunked number. In a new post Wednesday, Lincoln didn’t mention “$1.75 trillion” but instead wrote:
Currently, federal regulations are draining nearly 12 percent of U.S. GDP annually.
Where’d that new number come from? Doesn’t sound familiar. There was no citation. Let’s see, U.S. GDP is about $14.7 trillion; multiply that by 12 percent and you get about… $1.75 Trillion.
Full textAustan Goolsbee, outgoing Chairman of the Council of Economic Advisers, took to the Daily Show on Wednesday for one last sit-down with Jon Stewart. Stewart included a question on regulations (part 2, at 3:55), and Goolsbee gave a spirited defense:
Stewart: Does the president believe business is overregulated? Does he think we are bureaucratically so snafu-d and entangled that that is the problem with the economy right now?
Goolsbee: As a general matter, no. Though there certainly [are] individual things that could be done different and streamlined, where, you know, they have to submit paper forms, they can’t do it on the web, you know, things of this nature. But, the president said from way back when, being for rules of the road doesn’t make you anti-market. And in fact, what we saw in the financial system, what we saw in oil drilling in the Gulf, and a bunch of places, ripping up the rules of the road were devastating to business. It wasn’t just that it was bad for society, it was bad for those companies that nobody was following the rules of the road, because when you lose public trust you don’t have it.
Not bad for boiling it all down to a few sentences.
Full textThe House Energy & Commerce sub-committee on Environment and the Economy held a hearing yesterday on “regulatory chaos” (yikes!). One figure seemed popular: $1.75 trillion. That’s how much regulations cost the U.S. economy each year, sub-committee vice-chair Tim Murphy said in his opening statement. Two of the four witnesses made the same claim in their testimony (William Kovacs of the Chamber of Commerce and Karen Harned of the National Federation of Independent Business). The committee’s briefing memo on the hearing featured, you guessed it, the same number.
The number, of course, comes from a September 2010 study sponsored by the Small Business Administration’s Office of Advocacy. In February, a CPR white paper showed that the SBA study was severely flawed. Most notably, more than 70 percent of the total cost estimated had been based on public opinion polling about the perceived regulatory climate in different countries, numbers that the original researchers had never meant to be used for a guess about the total effect on the U.S. economy. In April, the nonpartisan Congressional Research Service published a report on the SBA study, including similar and additional critiques.
Even more impressive is that neither the study nor those who cite it make any effort to account for the benefits of regulation – saved lives, cleaner air and water, safer workplaces, safer automobiles, and so on. If they were to do that, they’d have to report that the benefits – even by the means of the badly-slanted-against-regulation methods of cost-benefit analysis imposed by the Office of Management and Budget – greatly outweigh the costs. But the Small Business Administration’s study simply ignores the benefits, the better to focus attention on its jaw-dropping, if wildly inaccurate, estimate of the costs.
Why is it regulatory opponents can’t seem to cite many studies on regulations other than this one?
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