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All articles with the "Deregulation" tag.

Published: Tue, 16 Jan 2018 00:00:00 -0500

Last Build Date: Tue, 16 Jan 2018 20:21:54 -0500


Will Deregulation Kill Workers?

Thu, 11 Jan 2018 11:15:00 -0500

A temporary federal hiring freeze last year saw staffing numbers at the Occupational Safety and Health Administration (OSHA) fall by about 4 percent. Forty of the agency's approximately 1,000 inspectors departed without replacements filling their vacated positions. Some observers see this as an example of deregulatory fervor running amuck and costing lives. "The bottom line," wrote former OSHA official Jordan Barab, "is that shrinking government is not just about reducing employees and 'bureaucrats,' or combating 'waste, fraud and abuse,' it means limbs severed and lives lost." "While Trump might say we need smaller budget, smaller government, at the end of the day I think workers would rather their health and safety thought of," says Marni Von Wilpert of the Economic Policy Institute. A declining number of OSHA inspectors, managers, and other staff, she tells Reason, are putting lives at risk. In fact, as with most critiques of the Trump administration's rather marginal regulatory rollbacks, these worries about a small decline in the number of safety snoops are overwrought. They carry an implicit assumption that only federal regulation can keep workers safe, but the evidence suggests the opposite: While the number of OSHA inspectors per capita has declined, American workplaces have only gotten safer. Since agency's founding in 1971, the number of OSHA inspectors has stayed pretty consistent, never going above 1,500; it has hovered around 1,000 since the early 1980s. During that same time, the number of workplaces in the United States has expanded rapidly. So the ratio of inspectors to workers has fallen from roughly 15 inspectors for every million employees in 1980 to 6.8 per million in 2016. "The economy has been growing and jobs have been growing. OSHA's ability to keep up with workplace safety has been shrinking," von Wilpert says. Yet workers are safer on the job now than at almost anytime before. In 1980, 13,800 people died at work—a workplace fatality rate of 13 deaths per 100,000 workers. By 2015, worker deaths were down to 4,836, making for a workplace fatality rate of 3.4 deaths per 100,000 workers. Workplace fatalities were also falling at a continous rate in the decades prior to OSHA's creation, dropping from 37 deaths per 100,000 workers in 1933 to 17 per 100,000 workers the year OSHA was created. None of that surprises John Leeth, a Bentley University economist who has researched workplace safety. A marginal decline in the number of OSHA inspectors in nothing to be concerned about, he says. "It's hard to say that increasing the number of inspectors for OSHA or reducing them by small amounts is going to have much of an impact one way or another," Leeth tells Reason. Employers have much stronger incentives than OSHA to provide a safe workplace. Each state, for example, requires employers to purchase workers compensation insurance for their employees. Those policies cost employers $91.8 billion in 2014, according to a study conducted by the National Academy of Social Insurance. Total OSHA penalties in that same year totaled only $143.5 million. Like other forms of insurance, workers comp grows more expensive with new injuries and accidents. Leeth estimates that this incentive to improve workplace safety is responsible for up to a 22 percent reduction in workplace fatalities. Labor markets themselves provide another major incentive for employers to provide safer working conditions. "Workers don't like risk," says Leeth. "There is nothing to be gained by taking a risky job other than the employer giving you something in return." A 2012 working paper co-authored by Leeth found that employers paid an additional $100 billion a year in this kind of danger pay, easily dwarfing the costs of OSHA fines and enforcement actions. The ability to sue over workplace injuries and health hazards also encourage employers to protect employer safety. "If you rank the three other areas that provide incentives, you're talking multi-billion dollars, and then you get to OSHA and the expected penalty is incredibly small," says Leeth[...]

D.C. Deregulates Birth Control...and Dooms It With Obamacare Add-Ons

Wed, 10 Jan 2018 12:45:00 -0500


The District of Columbia Council gave the green light Tuesday to a bill allowing birth control pills to be purchased with a pharmacist's prescription.

The measure stops short of allowing over-the-counter contraceptive sales, which would run afoul of Food and Drug Administration policy. But it would allow for women to obtain birth control pills without regular visits to a doctor. The D.C. Board of Pharmacy would figure out how to implement the change.

The change would put D.C. in line with a rapidly increasing number of states allowing pharmacist-prescribed oral contraceptives. Following Oregon and California's lead, Colorado, Hawaii, Maryland, Missouri, New Mexico and Ohio passed similar legislation last year. Several others (including Iowa, Illinois, Massachusetts, Maine, South Carolina, Texas, and Tennessee) considered it.

The D.C. bill isn't all deregulatory goodness: it would also enshrine parts of the Affordable Care Act (ACA) into local law, including the requirement that insurance companies cover contraception and other preventative health services at no out-of-pocket cost to the insured. The idea is to ensure their continued "free" coverage even if all or part of the ACA is repealed.

The bill now heads to D.C. Mayor Muriel Browser. If she signs it, the measure will then (like all D.C. legislation) be subject to congressional review—which could be tricky considering the current climate with regard to contraception mandates and Obamacare in general.

"No other state or local jurisdiction in the country has to worry that a random congressman is going to try and meddle with a locally-passed law," lamented D.C. council member and author of the bill, Charles Allen, in a statement.

True—but decreasing the barriers to accessing contraception might have a better chance if not yoked to a currently pointless policy backing up an already existing (and controversial) federal law.

Deregulatory Successes Point to Direction for Trump Administration

Tue, 09 Jan 2018 00:15:00 -0500

Even as CNN talking heads remain in shock that Donald Trump is actually president, and the man himself apparently sees social media as a means to go full drunk-uncle on an international scale, millions of Americans continue to support the current resident of the White House. FiveThirtyEight has Trump's approval ratings at 38.8 percent as I write, and an insight into why many Americans continue to put their faith in this president landed last week in the form of a Washington Post article on the relief felt by Iowa farmers over the Trump administration's push to roll back much-resented regulatory red tape. "Obama set aside millions of acres of undeveloped land as national monuments—more than any other president—preventing huge areas from being mined, logged or farmed. Obama also implemented more regulations with a significant economic impact than any president in three decades, according to the George Washington University Regulatory Studies Center. Those actions were cheered by many Americans but widely viewed in rural areas as killing jobs." Iowa, a farming state, notably went overwhelmingly for Trump in 2016 after supporting Barack Obama in both 2008 and 2012. The Obama administration's controversial Waters of the United States rule received particular criticism for extending federal jurisdiction over unlikely wet patches of ground in ways that burdened the use of private property. The U.S. Court of Appeals for the 6th Circuit issued a nationwide stay against the rule in 2015, but memories linger. And so does resentment of politicians and regulators who seem clueless or even actively hostile to whole ranges of economic activity. "The overwhelming number of proposed regulations on the nation's food system is unprecedented and promises profound effects on both the structure and competitiveness of all agriculture," Carl Shaffer of the American Farm Bureau Federation noted in congressional testimony during 2011 hearings. "EPA proposals are overwhelming to farmers and ranchers and are creating a cascade of costly requirements that are likely to drive individual farmers to the tipping point." Business people who never touch a plow have similar concerns about regulation. "The average small-business owner is spending at least $12,000 every year dealing with regulations," National Small Business Association President and CEO Todd McCracken commented upon the release of a survey of small business owners last year. "This has real-world implications: more than half of small businesses have held off on hiring a new employee due to regulatory burdens." In that survey, 58 percent of small business owners said federal rules were the most burdensome to their business, with a specific emphasis on the tax code and the Affordable Care Act. Unsurprisingly, USA Today reported as Trump took office that "small businesses are hoping to see some high-profile Obama administration regulations scrapped." The federal government was equally tough on the energy industry, issuing rules regarding hydraulic fracturing that were sufficiently overreaching that they were quickly blocked by the courts as being "in excess of its statutory authority and contrary to law." Those rules were officially rescinded at the end of December, prompting the market-friendly Las Vegas Review-Journal to exult, "President Donald Trump's deregulation agenda has perhaps been the defining accomplishment of his first year in office. " Which is an interesting point. Largely lost in headlines about Russians, campaign dirty tricks, and Trump's alleged shock at his own victory is his administration's follow-through on deregulatory promises. Soon after taking office in January 2017, Trump ordered federal agencies to make sure that "for every one new regulation issued, at least two prior regulations be identified for elimination, and that the cost of planned regulations be prudently managed and controlled through a budgeting process." That was followed by an order to conduct cost-benefit analyses of federal regulations. In Sept[...]

'Food Police' Thriving Under Alleged Deregulator Trump

Sat, 06 Jan 2018 08:00:00 -0500

Last week, a fantastic front-page New York Times article looked at the phenomenon of regulatory fatigue, set against the Trump administration's claims to be focusing huge attention on many of the rules that lie at the heart of that fatigue. The in-depth Times piece looked at regulations impacting apple growers—including everything from water and labor rules to the "assortment of rules, guidances, standards and training requirements associated with ladders, including how to achieve proper angling and how to prevent falling when filling produce bags." The ladder issue was particularly apropos because of the name of an apple farm profiled in the story, Indian Ladder Farms in upstate New York. Many of the rules the article discusses are inane, costly, and unhelpful. Together, these rules, put in place by faceless acronyms—including the EPA, FDA, USDA, OSHA, and other state and federal agencies—can crush small apple growers, as I told the Times in the piece. "So many of the farmers I've spoken with tell me that stricter and stricter regulations have put many of their neighbors and friends out of business, and in doing so cost them their homes, land and livelihoods," I say in the Times piece. "For many farmers, rolling back regulations is the only way they can survive." Coincidentally, just days before the Times piece was published, President Donald Trump used remarks he made in the White House's Roosevelt Room to tout his purported deregulatory fervor and successes, touting his administration's first year as the "most far-reaching regulatory reform" efforts ever by a U.S. president. "We have decades of excess regulation to remove," Trump said. "To help launch the next phase of growth, prosperity and freedom, I am challenging my cabinet to find and remove every single outdated, unlawful and excessive regulation currently on the books." I have no doubt there are "decades of excess regulation to remove." There are. But I have no faith whatsoever either in the will or abilities of Trump or his appointees to carry out this rollback. Consider, for example, that Trump made a campaign pledge to kick the "FDA food police" out of Washington. His controversial executive order mandating that agencies revoke two regulations for every new one they seek to adopt could be used as a tool to accomplish just that. But like seemingly everything else Trump, his pledges and orders resemble little more than some sort of chintzy window dressing. FDA commissioner Scott Gottlieb, appointed by Trump, appears not even to share the Trump administration's purported zeal to cut food regulations. As a Regulatory Affairs Professional Society post noted recently, the Trump administration "has yet to take a saw to its regulations, and FDA Commissioner Scott Gottlieb seemed to walk back Trump's pledge" to do so. The website Food Dive also described Gottlieb's position on food regulations as almost entirely nebulous. "It hasn't been easy to get a clear sense of where the new FDA director stands on many food safety and nutrition issues," it reported. There's good reason to be skeptical of the willingness of Gottlieb's FDA to cut food regulations. For example, he doubled down last fall on awful Obama administration menu-labeling rules, part of the Affordable Care Act, saying the FDA will act in part because Gottlieb is a "doctor" and "father." He's also continued the Obama administration's nannying pursuit of all things "Loko," going after the snortable chocolate Coco Loko with the same gusto Obama's FDA targeted the caffeinated alcohol beverage Four Loko. It's not just Trump's FDA that stinks. His USDA has also been lousy. The Trump administration rolled back Obama administration rules on USDA school lunches—so that the rules are different than they were recently but still awful like they were before that—with the embarrassing claim to be "making school lunches great again." The USDA also recently targeted Maine after the state adopted a food sovereignty law that would hav[...]

Regulations at 'Lowest Count Since Records Began Being Kept in the Mid-1970s'

Fri, 05 Jan 2018 13:15:00 -0500

As the economy and stock market continue to chug along nicely, many analysts and presidents are giving at least partial credit to the Trump administration's aggressive regulatory reform efforts. Dow just crashes through 25,000. Congrats! Big cuts in unnecessary regulations continuing. — Donald J. Trump (@realDonaldTrump) January 4, 2018 Unsurprisingly, this is driving some commentators insane. "Trump's Deregulatory Binge Makes the Bush Years Look Like Stalinist Russia," runs the headline in The Daily Banter, a website that was "started in 2007 when Editor in Chief Ben Cohen got fed up with watching the corporate news not doing its job properly," and that further claims "not do viral content" or "trick readers with misleading headlines." (Cohen's misleading subhed, by the way, begins: "The Bush years were characterized by a deregulatory binge that saw deep cuts to virtually all aspects of government with little to no reasoning behind them," despite the fact that people who actually study this stuff will inform you that Bush increased the reach, budget, and staffing of the administrative state—including on financial regulation—at a far greater clip than his Democratic predecessor, while overseeing an eight-year government spending bender.) An infinitely better reported, yet ultimately even more unintentionally amusing effort came in Monday's New York Times, which contained plenty of now-hold-on-there sentences like "The evidence is weak that regulation actually reduces economic activity or that deregulation stimulates it," and "There is little historical evidence tying regulation levels to growth," and "Regulatory proponents say, in fact, that those rules can have positive economic effects in the long run, saving companies from violations that could cost them both financially and reputationally." Why is that funny? Because much of the rest of the article is composed of quotes and data from actual business humans about why they're investing so much more money during the Trump presidency. Stuff like, "That [regulatory] burden has slowed down economic growth, it's slowed down investment in infrastructure [in the past]. And what we've seen over the last year is a big deregulatory environment." The preponderance of feel-good evidence is such that the Times headlined the piece "The Trump Effect," and began it with these two almost startlingly upbeat paragraphs: A wave of optimism has swept over American business leaders, and it is beginning to translate into the sort of investment in new plants, equipment and factory upgrades that bolsters economic growth, spurs job creation — and may finally raise wages significantly. While business leaders are eager for the tax cuts that take effect this year, the newfound confidence was initially inspired by the Trump administration's regulatory pullback, not so much because deregulation is saving companies money but because the administration has instilled a faith in business executives that new regulations are not coming. As you can imagine, this conclusion by the Gray Lady could not stand. "The front-page story is so egregious," thundered Think Progress, "that one of the the paper's leading columnists, Nobel prize-winning economist Paul Krugman, eviscerated it in a series of tweets on Tuesday morning." You should always take bold assertions of political cause and economic effect with massive grains of salt, particularly at a time when almost the entire global economy is doing pretty well in unison. You can, however, make at least some preliminary measures of Trump's regulatory reform activities. And what you see there will indeed make a progressive recoil and a libertarian smile. As the year closed out last week, the deregulators over at the Competitive Enterprise Institute took a look at the final page- and regulation-count in the 2017 Federal Register. This is what they found: The calendar year concluded with 61,950 pages in the Federal Register […] This is the lowe[...]

British Think Tank Report Says EU Food Policies Raise Food Prices

Sat, 25 Nov 2017 14:40:00 -0500

A new report from the TaxPayers' Alliance, a British nonprofit, argues that British food prices have been made artificially higher—an estimated seventeen percent so—by a combination of EU "tariffs, subsidies, and overly restrictive regulations." The 51-page report comes as Britain crafts its future ahead of 2019's Brexit, which will likely leave British lawmakers solely responsible for crafting the island's agricultural policies. While some in Britain have argued that these high food prices necessitate government provide more aid to those in need, the TaxPayers' Alliance report concludes that since government policies are responsible for the higher food prices in the first place, it makes far more sense to repeal the bad policies, thus targeting the root causes of those problems. "Brexit gives the UK an unprecedented opportunity to examine its agricultural and trade policies and adopt a more liberal approach which will ultimately result in a more productive agricultural sector and lower food prices for consumers," the Taxpayers' Alliance said in a recent farm-policy statement. The report pins most of the blame for these higher food prices on the European Union's bloated Common Agriculture Policy, known as CAP. "The programme is the most expensive scheme in the EU—accounting for more than 40% of its annual budget—and one of the most controversial," the BBC explained in a 2013 expose on CAP. The BBC notes agricultural subsidies under CAP, which predates the creation of the EU by several decades, are responsible for "the creation of 'mountains' and 'lakes' of surplus food and drink." But these subsidies, the TaxPayers' Alliance report reveals, are just one part of the CAP problem. CAP also imposes steep import tariffs on food. For example, the group cites research in its report showing that CAP taxes dairy imports at a rate of more than thirty-five percent, and that "the tariff on processed chicken is 88 per cent." CAP tariffs also target non-food items like farm equipment. Finally, the Taxpayers' Alliance report says strict CAP food-safety regulations also help make food prices artificially high. This combination of subsidies, tariffs, and strict regulations have made CAP the perfect tool, as the 2013 BBC article concluded, to make "Europe's food prices some of the highest in the world." So does the Taxpayers' Alliance report carry any weight in Britain? Maybe so. The group was founded in 2004 to combat government waste, higher taxes, and the lack of government transparency. By 2009, The Guardian reported then, the Taxpayers' Alliance had become "arguably the most influential pressure group in the country." That's great news. But why—beyond your status as a denizen of this Earth—should you care about some British think tank's report on the impact food taxes there? Sure, we fought a war against Britain that was, I've argued, in large part, a revolt against food taxes. But that was a long time ago. You should care about this report and the outcome of post-Brexit policies in Britain because the same issues the TaxPayers' Alliance highlights in its report are currently at issue right here in the United States. We certainly have wasteful farm-subsidy programs in place. It's a topic I've written about here probably a million times, including as recently as last week. We have food taxes that some argue should be increased. Some states tax groceries. Some activists in this country have argued for taxing "bad" food and subsidizing "good" food. I've been part of the debate, for example serving as a panelist at this Urban Institute event on the validity of taxing so-called "junk food" in 2015. Finally, we currently have a president who has argued for the purported merits of new import tariffs. More specifically, he seems particularly enamored of food tariffs. If these lousy economic policies are bad for Britain and British consumers—as they most certainly are—then they are also bad f[...]

Is Donald Trump, of All Presidents, Devolving Power Back to the Legislative Branch?

Mon, 20 Nov 2017 14:13:00 -0500

Donald Trump did not campaign for president as the guy who would reverse the mostly unbroken, century-old trend of the executive power assuming more and more power in the face of an increasingly self-marginalizing Congress. If anything, the imperial presidency looked set to increase given Trump's braggadocious personality and cavalier approach to constitutional restraints. "Nobody knows the system better than me," he famously said during his worryingly authoritarian Republican National Convention speech, "which is why I alone can fix it." You wouldn't know it from viewing policy through the prism of the president's Twitter feed, which is filled with cajoling and insult toward the legislative branch, but Trump has on multiple occasions taken an executive-branch power-grab and kicked the issue back to Congress, where it belongs. As detailed here last month, the president has taken this approach on Iran sanctions, Obamacare subsidies, and the Deferred Action Against Childhood Arrivals program (DACA), at minimum. And notably, his one Supreme Court nominee, Neil Gorsuch, was most famous pre-appointment for rejecting the deference that courts have in recent decades given to executive-branch regulatory agencies interpreting the statutory language of legislators. Are there any other examples? Sure—the 15 regulatory nullifications this year via the Congressional Review Act (14 more than all previous presidents combined) are definitionally power-transfers from the executive to legislative. And certainly, the sharp decreases in the enactment, proposal, and even page-count of regulations amount to the administration declining to exercise as much power as its predecessors. Over at the Wall Street Journal, Chris DeMuth, former president of the American Enterprise Institute, and Reagan-era administrator of the Office of Information and Regulatory Affairs (OIRA), points out some of these underappreciated devolutions, and, with qualified enthusiasm, adds another: Regulatory budget-cutting. In an executive order issued shortly after taking office, he directed that unless a statute requires otherwise, agencies may issue new regulations only by rescinding two or more existing regulations, with net costs held to an annual budget. His budget for fiscal 2017 was zero, which was easily met after agencies issued few new rules and lawmakers rescinded many under the Congressional Review Act. Now, an OMB directive from [OIRA administrator Neomi] Rao in September has set a goal of "net reduction in total incremental regulatory costs" in fiscal 2018. […] [A] regulatory budget goes much deeper [than mere cost-benefit analysis of regulations]. It aims not only at restraint but at reforming agency culture. Faced with a two-for-one rule and a requirement to reduce annual costs, regulators will be obliged to monitor the effectiveness of all their rules and to make choices. There will be efforts to game the system, as there always are. But the best game in town may be to shift from maximizing rules to maximizing, within the budget constraint, environmental quality, public health, workplace safety and other regulatory goals. And, in all events, there will be fewer rules! DeMuth adds, archly, "Many readers may be puzzled that our tempestuous president should preside over the principled, calibrated regulatory reform described here." Bottom line? With some exceptions (such as business as usual on ethanol), and putting aside a few heavy-handed tweets (such as raising the idea of revoking broadcast licenses from purveyors of "fake news"), President Trump has proved to be a full-spectrum deregulator. His administration has been punctilious about the institutional prerogatives of Congress and the courts. Today there is a serious prospect of restoring the constitutional status quo ante and reversing what seemed to be an inexorable regulatory expansion. You read it here first. UPDATE: Josh Blackma[...]

Permissionless Biotech Crop and Livestock Innovation

Thu, 16 Nov 2017 17:46:00 -0500

Obama administration minions issued drafts of biotech crop and livestock regulations just two days before they left office last January. They were apparently motivated by their worry that genetically improved crops and livestock created using precise new genome-editing techniques like CRISPR would escape government oversight. There is good news. The USDA has now withdrawn these proposed regulations. The FDA should immediately follow suit and withdraw the scientifically indefensible regulatory proposals submitted by the Obama Administration. As I reported earlier: Treating each version of new improved livestock as a drug is really bad news for developers and consumers, since it takes years for a new drug to get through the FDA process at an average cost of more than $1 billion. Consider that it took the agency 20 years to approve the Aquabounty salmon that was genetically engineered simply to grow faster. The proposed USDA regulations were designed to change the way the agency approves genetically engineered plants and the draft FDA rules would subject genetically improved livestock to the same onerous process required to get the agency's permission to market new animal drugs. On the face of it, the precision of new genome-editing techniques would seem to call for less, rather than more regulation. The Obama administration proposed that breeders of gene-edited plants submit their new varieties to the USDA for pre-approval. Waiting on agency decisions would very likely slow down the process of developing new biotech crops even more. Under the Obama administration's proposed rules, the FDA would have required pre-approval of genetically improved livestock like Holstein dairy cows engineered to contain the same gene for hornlessness found naturally in Angus beef cattle. Since that gene in Angus cows harms no one, it wouldn't hurt anyone if it were in Holstein cows. So why should breeders have to beg FDA permission to sell hornless Holsteins? Why should breeders have to get regulatory permission at all to sell genetically engineered crop varieties or livestock? Breeders have for nearly 100 years been inducing genetic changes in plants by bathing them in caustic chemicals or blasting them with gamma rays to create hundreds of new crop varieties. The Mutant Variety Database run jointly by the Food and Agriculture Organization and the International Atomic Energy Agency lists more than 3,000 commercially available crop varieties created using mutagenesis. None of these mutated crop varieties required regulatory approval before their developers could introduce them into the marketplace. Why should crops created using vastly more precise biotech genome-editing need regulation? Animal welfare issues might arise in the cases of gene-edited livestock, but otherwise there is no scientific justification for regulating them as "new animal drugs." The FDA should speedily follow the USDA's salutary lead and withdraw the draft biotech regulations that the Obama administration left behind at that agency. Both agencies should step back and adopt the principle of permissionless innovation with respect to modern biotechnology. Mercatus Institute fellow Adam Thierer defines this as "the notion that experimentation with new technologies and business models should generally be permitted by default." He adds, "Unless a compelling case can be made that a new invention will bring serious harm to society, innovation should be allowed to continue unabated and problems, if they develop at all, can be addressed later." Since there is no such compelling case against advanced biotechnology, both agencies should radically reduce the amount of regulation that they currently impose on the development and deployment of modern biotech crops and livestock.[...]

Trump Brags About His Deregulation—And He May Be Right

Mon, 13 Nov 2017 17:00:00 -0500

President Trump, in a "brief telephone call" with The New York Times earlier this month listed "what he saw as his biggest accomplishments, including a focus on deregulation." The Times relegated the mention of deregulation to a paragraph low down in the story, which itself ran inside the newspaper rather than on the front page. It wouldn't be the first time that the elite press or its readership made the mistake of failing to pay attention to, and to actually hear, what Trump is saying. More sophisticated observers are starting to take note. The Economist, in a piece published last month, reported, "the impact of the Trump administration has been dramatic. The flow of new rules is suddenly a dribble. Since Mr Trump was inaugurated the number of regulatory restrictions has grown at about two-fifths of the usual speed." The British newsmagazine, which is not generally a Trump cheerleader, praised the administration's approach to financial deregulation as "thoughtful…detailed and rigorous." It reported, "the new approach in Washington does seem to have boosted business confidence." In rolling back regulation, Trump is focusing on a real problem. The Mercatus Center at George Mason University captures the growth of federal red tape with a thought experiment explaining the difficulty of even reading, let alone complying with, the government imposed rules. "The US Code of Federal Regulations—the annually published set of books containing all federal regulations currently in effect—contained 35.4 million words in 1970. A person could read the entire code in just a few days short of a year, assuming he or she read 250 words per minute, 40 hours per week, 50 weeks per year," the Mercatus scholars wrote. "Fast-forward to 2016, the last year for which we have data, and the task becomes more than three times as difficult," the Mercatus scholars say. "By 2016, there were 104.6 million words of federal regulation on the books, about 195 percent growth over 1970, with a corresponding increase in reading time of almost two years. " IBM has been running full-page newspaper ads boasting that its Watson artificial intelligence capability can help compliance officers "keep up with 20,000 new or modified regulations a year and 200 revisions a day." An IBM executive and former bank regulator warns, "humans alone are not going to be able to meet these challenges. Advanced technology tools are essential." There are so many rules, and they change so fast, that you need a supercomputer to keep track of them. Either that or more and more people. The number of people with the job "compliance officer" has more than doubled, to 273,910 in 2016 from 126,840 in 2000, according to the federal Bureau of Labor Statistics. More regulations mean more people whose job is making sure companies follow the regulations. Mercatus warns about "unintended consequences, including slower economic growth, reduced employment opportunities, and disproportionate harm to low-income households." There's also a risk of selective enforcement. When rules multiply, impartial enforcement becomes challenging, and the temptation increases for prosecutors, or regulators, to pick an unpopular individual or industry, and then look for an offense. Pruning back regulation doesn't have to be a partisan issue. President Carter, Senator Edward Kennedy, and Kennedy's then-aide Stephen Breyer, now a Supreme Court justice, all Democrats, got this going when they tackled airline deregulation in the 1970s. Even Hillary Clinton campaigned in New Hampshire in 2015 saying, "I want to do everything I can to help make it easier for people to start businesses, cut that red tape....and really take a hard look at licensing requirements from state to state." The idea is also catching on globally. Excessive European Union regulation was one of the factors that motivated the Britis[...]

The FDA Will Finally Let You See Your Genetic Information

Tue, 07 Nov 2017 08:45:00 -0500

(image) Food and Drug Administration (FDA) head Scott Gottlieb is reeling in his agency's outrageous four-year ban on direct-to-consumer genetic testing.

Under the Obama administration, the FDA sent a letter to the genetic testing company 23andMe warning that the company was "marketing the 23andMe Saliva Collection Kit and Personal Genome Service...without marketing clearance or approval in violation of the Federal Food, Drug and Cosmetic Act." The letter noted that the company's tests had been providing "health reports on 254 diseases and conditions," including categories such as "carrier status," "health risks," and "drug response." But not anymore: The folks at 23andMe had little choice but to knuckle under to the agency's demands and stop testing new customers.

The company was eventually permitted to offer genetic test information on customers' ancestry and on genes associated with traits like the length of their toes. In early 2015, the agency allowed the company to provide users with results from a trait carrier test for Bloom Syndrome. Prior to the FDA's ban, the company's $99 genomic screening test package had included results from 53 trait carrier tests.

In April of this year, the FDA finally allowed the company to supply customers with genetic health risk information for 10 different conditions, including late-onset Alzheimer's disease, Parkinson's disease, celiac disease, and hereditary thrombophilia (harmful blood clots). Before the ban, the company had been providing its users with some genetic insights with regard to all of those health risks and about 140 others.

Gottlieb's statement dramatically loosens his bureaucracy's stranglehold on direct-to-consumer genetic testing. After genetic health risk test manufacturers have passed through a one-time FDA review ensuring that they meet the agency's requirements for accuracy, reliability, and clinical relevance, any subsequent additional health risk tests will not need to undergo further review. "The floodgates for direct-to-consumer genetic tests are swinging wide open," declares the STAT science new service. Let's hope so.

For more background, see my 2011 Reason article on my own genetic testing experience here. Go to SNPedia here for even more information on my genetic flaws.

Trump's Deregulatory 'Juggernaut'?

Fri, 03 Nov 2017 08:30:00 -0400

"While the Republican machine that emerged from the 2016 election may be sputtering on other fronts," The Wall Street Journal's Gerald F. Seib wrote this week, "it is proving to be a juggernaut on deregulation." But is that really true? Seib notes that a recent U.S. Chamber of Commerce survey shows (in his phrasing) "29 executive reduce regulatory requirements," "100 additional directives that either knock down regulations or begin a process to eliminate or shrink them," "almost 50 pieces of legislation that have been introduced or begun moving through Congress," plus the overturning of 14 end-of-term Barack Obama regulations via the Congressional Review Act (CRA). He does not mention, though you can read all about it right here, that the Competitive Enterprise Institute one month ago issued a report at the Trump administration's nine-month mark concluding that he is "the least regulatory president of all," with significant ($100 million and up) regulations down 58 percent from Obama's first 9 months of 2016, and significant proposed rules down 77 percent. Those numbers are real, and meaningful. But "deregulatory"? Slowing down and even blocking regulation is not the same as removing human activity from regulatory oversight by the state. It's true, the CRA (on which more below) has been used 14 more times under Trump than during all previous presidents combined, but that's against a backdrop of 2,183 rules issued during Trump's first nine months. In truth, there's really only so much that even the most deregulatory-minded president can do (and Trump has plenty of regulatory impulses as well). Real deregulation, as I spelled out in this magazine feature, must come from Congress: "What deregulation meant [back in the 1970s] was we altered statutes," [Regulation Editor Peter Van Doren] explains. "Congress rewrote the laws." It's the underlying legislation, which instructs regulatory agencies to spend money and promulgate rules, that needs to be repealed, not just the odd stinkbud blooming at the end of the process. Even radical-sounding proposals, like the one-sentence bill introduced in February by the libertarian-leaning Rep. Thomas Massie (R–Ky.) to close down the Department of Education, ultimately "doesn't do anything," Van Doren argues. "You know why? The statutes!" If you don't want federal money to be spent on education, he says, "you have to rewrite and/or eliminate the Elementary Secondary Education Act of 1965.…The Department of Education simply implements the ESEA, so if you eliminate the implementer, the law still exists." ("It's a fair charge," Massie acknowledges. "I had to decide whether to write a one-sentence bill that I could get a lot of people to agree with, or a very involved bill that talks about what happens to all that funding, and then people start disagreeing.") So has this Congress, which has shown tangible enthusiasm both for killing stinkbuds and debating process-reform bills, started the hard work of repealing the problematic underlying laws? I'll answer the question with another question: Is the indefensible Jones Act still gratuitously hobbling hurricane-ravaged Puerto Rico? As Susan Dudley, the regulatory studies director at George Washington University and former administrator for the Office of Information and Regulatory Affairs, recently concluded, "Despite some promising bipartisan efforts, the 115th congress has failed to make much progress on regulatory reform legislation, and the opportunities for doing so are rapidly diminishing." However, Dudley also reports on an interesting new CRA wrinkle that could swell the list of potentially reviewable regulations into the thousands: The window for such disapprovals was widely thought to have closed in May, but just last week, congress showed that it is [...]

45 Percent of Americans Say There Is Too Much Government Regulation of Business

Thu, 12 Oct 2017 15:50:00 -0400

(image) A new Gallup Poll reports that "for the 12th year in a row, more Americans say there is 'too much' government regulation of business and industry than say there is either 'too little' or 'the right amount.'" More specifically: Forty-five percent say there's too much, 23 percent say too little, and 29 percent say things are just right.

While the streak is unbroken, this is down from the 2011 peak, when 50 percent believed there was too much regulation. Among Republicans, 68 percent now believe regulation is too high; only 20 percent of Democrats do.

I'm with the 45 percent. A study last year from the Mercatus Institute estimated that since 1980, federal regulations have slowed growth so much that economy is 25 percent smaller than it could have been. That means American per capita income is $13,000 lower than it would have been otherwise.

And federal regulators aren't the only impediments to betterment. State and local rules, such as licensing laws and land use controls, make it hard for Americans to leave low-productivity regions to enter booming job markets. One recent study calculated that without the excessive zoning restrictions U.S GDP would have been 8.9 percent higher, which translates into an additional $8,775 in average wages for all workers.

In January, President Donald Trump signed an executive order requiring that for "every one new regulation issued, at least two prior regulations be identified for elimination." Some reports do suggest that the Trump administration has significantly slowed the federal regulatory juggernaut, whereas others point out the difficulty in making such assessments.

None of this means it is impossible for a regulation to provide more in benefits than it cost. But the data strongly suggest that we're well past the point of diminishing returns.

Trump at 9 Months: 'The Least Regulatory President of All'

Mon, 02 Oct 2017 16:15:00 -0400

The most underreported story (except here at Reason!) about President Donald Trump's White House nine months in has been his administration's concerted effort to slow down, block, roll back, and reform the regulatory state. Given that, in the wake of serial Obamacare-repeal failure, Trump has arguably reached the pen-and-phone stage of his presidency 51 months before his predecessor did, you'd think that taking a poleaxe to the executive branch would receive more attention. But the man does have a knack for generating headlines far afield from the monotony of governance. The end of the fiscal year over the weekend gives us a chance to step back and do some counting—or better yet, let the regulation-obsessives over at the Competitive Enterprise Institute do it for us. There, CEI Vice President for Policy Clyde Wayne Crews has put together a piece, "Red Tape Rollback Report: Trump Ends Fiscal Year as America's Least-Regulatory President Since Reagan," that if anything is guilty of headline understatement. Consider: Compared to Obama at this time last year, Trump's [Federal Register] page count is down 32 percent so far in his first year. […] In nine months, the Trump administration has issued 2,183 rules. Obama issued 2,686 rules in the corresponding time period in 2016. Trump's tally represents an 18 percent decrease. Significant rules issued, generally those with an impact of $100 million or more, are down an astonishing 58 percent compared to Obama. Trump's agencies issued 116 significant final rules during his first nine months, while Obama's issued 274 over the corresponding nine-month period in 2016. And that doesn't count the rules currently being cooked up: Trump's overall proposed rules in the pipeline are far below any of his predecessors […] They are down a down 28 percent compared to the corresponding time frame from Obama's final year. Trump: 1241, Obama: 1737. Note that Trump's "significant" proposed rules are drastically below any predecessor. They are down 77 percent compared to Obama. Trump: 65, Obama: 290. Bolding in the original, which is filled with hyperlinks to further resources, and can be found here. Earlier this year I wrote a cover story on the prospects of Trumpian deregulation. Since then some of the will-he/won't-he signs that regulatory reformers were anticipating have come up positive. But as the recent Jones Act wavering, trade saber-rattling, and infrastructure-investment reversal illustrate, the 19th century protectionism that deregulation types were also fretting about in my article is always a threat to overwhelm the gains made by deconstructing and reshaping the administrative state.[...]

Trump Administration Blocks an Obscure Regulation, Hysteria Ensues

Thu, 10 Aug 2017 09:25:00 -0400

Witness the fevered reaction to the Trump administration's decision to drop mandated screenings for sleep apnea—a disorder that can interrupt sleep and contribute to fatigue—among train engineers and truck drivers. "We don't want train engineers with undiagnosed sleep apnea, who actually hold lives in their hands," thundered Senate Minority Leader Chuck Schumer (D–New York) at a hastily convened press conference. "It's very hard to argue that people aren't being put at risk," fretted former Federal Rail Administration head Sarah Feinberg. The pearl-clutching continued in the media. "How asleep should truck drivers be on the job?" asked The Atlantic. "Experts: Lives at risk if no sleep tests for train engineers." was the Associated Press headline. The panic amongst the political class in Washington is standard for even the most minor regulatory rollback proposed by the Trump Administration, underscoring the daunting political difficulty of major reform. It also points up the ridiculousness of the hysteria. For starters, Tuesday's decision did not eliminate any regulations. Nor did it eliminate any proposed regulations. The Department of Transportation under the the Obama Administration had been considering regulations on mandated sleeping disorder screenings for rail and truck operators. The Trump Administration ended that study. So when Rep. Sean Patrick Maloney (D–New York) says that "getting rid of this rule takes us backwards for no reason, and it's just plain stupid", he's talking about a rule that doesn't exist. Maloney also obscures the fact that the problem the non-existent rule is supposed to address is itself nearly non-existent. According to Federal Railway Administration data, there have been 86 rail accidents caused by sleeping employees since 1975—that's 42 years—resulting in two deaths and 80 non-fatal injuries. The National Transportation Safety Board (NTSB) considers the number slightly higher saying, "sleep apnea has been in the probable cause of 10 highway and rail accidents investigated by the NTSB in the past 17 years," including the 2013 crash of a Metro-North Railroad train in New York, caused by a dozing engineer which killed four people. The NTSB condemned Tuesday's decision to not go forward with sleep apnea regulation as well. The NTSB concedes that while sleep apnea might be a "probable cause" in many of these accidents, it is rarely the sole cause. Nor does it make a convincing case that more regulations in the form of mandated sleep apnea screenings by employers would have prevented many of these accidents. In 2001, for instance, untreated sleep apnea of an engineer and insufficiently treated sleep apnea of a conductor was blamed for a two-train collision in Michigan that resulted in the deaths of two crewmembers. That the conductor was already being treated for sleep apnea suggests that screening for sleep apnea was not the problem. At the time of the crash, the untreated engineer was working his seventh consecutive 12-hour graveyard shift, something that might have made anyone a little sleepy. The call for more regulation also ignores the voluntary steps taken by the rail and trucking industries to combat fatigue among their employees. Trucking associations and government regulatory boards from both the U.S. and Canada have created the North American Fatigue Management Program for managers, drivers, and spouses and family members of truck drivers. Their website includes a return-on-investment calculator for measuring the money saved from implementing anti-fatigue measures. The rail industry has taken similar measures according to a June 2017 report from the American Association of Railroads, including individual companies encourag[...]

Deregulation and Market Forces Can Lower Pharmaceutical Prices

Fri, 28 Jul 2017 09:15:00 -0400

In the rollout of their "Better Deal" program this week, Democrats identified high prescription drug prices as a major challenge facing America and proposed new regulations to rein them in. Their diagnosis is spot on, but their prescription is backwards. The way to roll back pharmaceutical prices is to deregulate and rely on market forces. But for that to happen, both Democrats and Republicans will have to resist the pharmaceutical lobby, which benefits from the status quo and is very generous with its donations. In 2015, spending on prescription drugs totaled $325 billion, or roughly $1,000 for every person in the U.S. according to federal data. Pharmaceutical spending rose by 9 percent from 2014 to 2015, far outstripping the growth of the GDP. Drugs in the U.S. often cost more than twice as much as they do in other developed countries. A 28-day supply of Humira costs a whopping $2669 on average here, according to the International Federation of Health Plans. The same supply costs $822 in Switzerland, $1253 in Spain, and $1362 in the United Kingdom. In a free market, such price differences are normally arbitraged, but the pharmaceutical market is anything but free. Federal law generally prohibits drug importation, so there is no legal way to ameliorate the international price gap. The pharmaceutical lobby (no surprise) opposes congressional efforts to legalize drug importation. Drug companies argue high prices offset the high costs of developing new drugs. A 2014 Tuft's study estimated the average cost to bring a new drug to market at $2.6 billion, much of it devoted to complying with the FDA's labyrinthine clinical trial process. Since 1962, when Congress empowered the agency to evaluate efficacy as well as safety, the FDA's trial regime has steadily become more onerous. The Bush Administration and Congress accelerated pharmaceutical price inflation by adding prescription drug coverage to Medicare in 2003. Legislation that added the costly new benefit included a "noninterference clause" that banned Medicare from negotiating prices with pharmaceutical companies. This places the government at a serious disadvantage with foreign governments that negotiate, putting a lid on their expenditures. Empowering the government to do anything is frightening for free market advocates, but consider this: when drug companies are selling to Medicare beneficiaries, they are essentially acting in the role of government contractors. It is in the taxpayers' best interest to allow the government to secure lower prices for the goods and services it purchases. In a normal market, consumers can act to limit prices by foregoing consumption or choosing less costly substitutes (like generic drugs or over-the-counter medicines). But since most prescription drug costs are covered either by the government or private insurance companies, consumers don't have much of an incentive to exercise these options. In this system of third party payment, drug consumers are insulated from the true cost of the pharmaceuticals they buy and those costs supported by taxpayers. This cost shifting can be reduced by increasing drug copayments and making them a percentage of a drug's retail price. Another way to lower drug costs is to increase competition. Right now, pharmaceutical companies are shielded from competition by patents and exclusivity periods. Even when drugs lose FDA monopoly protection, the FDA continues to effectively limit competition by delaying approval for generic alternatives, as Reason's Ronald Bailey recently reported. Patents are normally defended as a necessary incentive for drug price innovation, but if FDA approval costs were lower, this incentive could be reduced –[...]