American Elephants

Regulators’ Hubris Kills Free Market Innovation. Dumb Idea. by The Elephant's Child

Somewhere along the way, Congress got lazy and decided it would be better if they palmed off the annoying business of writing laws and regulations on the myriad federal agencies, and then they wouldn’t get so much disagreement from ordinary citizens, and they could do more important things like make speeches and fund raise.

Delegating such tasks to unelected bureaucrats has meant not only the vast expansion of am alphabet soup of agencies, but laws that sound as if they are written by faceless, unelected bureaucrats. Nobody understands the laws, every t may be crossed and i dotted, and every possible dereliction from the law may have its penalty and every regulation may attempt to control ever more of the actions of the public., but it’s not working and it should be stopped.

Agencies are working at cross purposes, regulations are based on inadequate understanding of economics, and caught between the proverbial rock and hard place, businesses close or decline to open, jobs are lost or are never created but the regulatory machine churns on unabated. The regulators remain completely unconcerned about their vast hubris, for they are convinced that they know better than the rest of us what is good for us.

Consider the 20,000 pages of the ObamaCare act which has not managed to be intelligible to anyone after 3½ years. Contrast that with the clean simple law of the Homestead Act of 1862: simple, clear language, 21,296 words that transformed the United States and populated the country. We could do with a lot more clear language and a lot less regulation.

A small company called 23andMe offers a genetic-testing kit. It consists of a tube into which the customer spits and returns to the company. The actual test is conducted at a lab that is regulated by another agency. The FDA has chosen to go after 23andMe aggressively for marketing a “medical device” even though the only “device” is a plastic tube, and the client cannot cannot undertake further action on the test result without  consulting a health care provider. This kind of device is part of the new economy, favoring the free flow of information. It is completely at odds with the old paternalistic model, in which regulators and the medical establishment control what patients may learn. Walter Olson, a senior fellow at the Cato Institute said there are sound legal reasons for the FDA to have refrained from acting in this case. But you can’t fight city hall, or a federal regulator. They will perhaps move offshore, jobs will not be created, and regulatory excess trumps citizen health.

The EPA decided that the Renewable Fuel Standards, which would require the use of 35 million gallons of alternative fuels by 2017, would promote clean energy. Unfortunately the technology for producing some kinds of biofuel did not exist. The goals failed to take into account the difficulty of turning that much corn into fuel, scientific studies demonstrated that engines in older care would be damaged by the new fuels. And government agencies and the military are required to buy significant amounts of a fuel that does not exist.

Hubris reigns, common sense evaporates, and citizen’s respect for government goes a glimmering. They brought it upon themselves.  As somebody remarked the other day, when the government refuses to obey the laws, rewrites them to suit themselves, and imposes silly regulations that destroy businesses and lives, pretty soon the people will act on the example, and decide that they don’t need to follow the regulations or the laws, and then where are we? Innovation goes where it is appreciated. Job growth will go where it is wanted.



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