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Preview: Reason Magazine - Topics > Regulation

Regulation



All Reason.com articles with the "Regulation" tag.



Published: Tue, 25 Apr 2017 00:00:00 -0400

Last Build Date: Tue, 25 Apr 2017 00:03:49 -0400

 



Premature Babies Are Struggling to Breathe. Why Are Regulators Dragging Their Feet?

Fri, 21 Apr 2017 13:00:00 -0400

As a neonatologist, I worry about patients with pulmonary hypertension. This unforgiving disease, sometimes seen after premature birth, can end with sudden death from constricting blood vessels in the lungs. One minute a baby in the neonatal ICU may be sleeping comfortably; moments later, doctors and nurses are giving chest compressions and rescue medications. A pulmonary hypertension crisis, as these frightening episodes are called, starts with a drop in the blood oxygen level. That drop triggers a monitor to beep. It's up to the nurse to hear the sound, come to the bedside and take action. The first and most effective step in stopping a pulmonary hypertension crisis is simple: Give oxygen. But a nurse caring for another patient might be delayed for 30 seconds, and the loss of that time can lead to brain injury or death. In an age of self-driving cars and 400-ton airplanes that can land themselves in blinding fog, it makes no sense that hospitalized patients are surrounded by lifesaving machinery that can be activated only by a person pressing a button or turning a knob. Modern transportation augments human judgment and reaction times with a computer's superior ability to continuously respond to dozens of fluctuating variables. Yet in medicine, safety remains stubbornly reliant on human intervention. FDA regulation impedes innovation My patients with pulmonary hypertension are often attached to a respirator with adjustable oxygen settings. The respirator sits inches below the monitor that indicates how much oxygen is in the blood. But the two machines can't communicate with each other. If they could, it would be possible to increase the flow of oxygen automatically the moment a crisis is detected. In 2009, engineers developed just this kind of closed-loop respirator and introduced it in several hospitals as part of a feasibility study. It increased the time premature babies spent at a safe oxygen level by more than two hours per day. But no biotechnology company has marketed the idea. There are other examples of automated systems with unrealized potential to save lives, and not just in the neonatal ICU. Software that scans an ECG for subtle heartbeat variability can identify patterns—undetectable to the human eye—that indicate an elevated risk of heart attack. Hospital beds that play audible feedback during an emergency promote more effective CPR. Yet patients are not benefiting because neither of these tools has been commercialized. Why haven't these innovations attracted the industry backing necessary to make them widely available? One reason is that the process of getting FDA approval for new devices—particularly those deemed "life-sustaining"—is often even more complicated and expensive than getting approval for drugs. In the Journal of Public Economics, Harvard Business School professor Ariel Dora Stern recently described how FDA hurdles discourage companies from investing in innovation. Often, the more profitable strategy is to wait for someone else to spend the time and money required to get approval for a new device, and then enter the market later with something similar that will face less scrutiny. Dr. Stern estimates that regulatory obstacles add an average of US$6.7 million to the cost of introducing a new medical device. For a company developing an ICU monitor, for instance, that will ultimately sell for less than $35,000 per unit, this up-front commitment can be prohibitive. A consequence is that small biotechnology firms (with annual revenue less than $500 million) rarely gamble on getting new inventions approved. Dr. Stern's paper notes that less than 17 percent of novel device applications to the FDA come from small companies. This is different from new drug applications, the majority of which originate at smaller firms. What's behind this discrepancy? Research has shown that while companies pay a steep price for pioneering new medical devices, the first firm to market a new type of drug often gets favorable treatment from the FDA. This raises the incentive for pharmaceutical startups to pursue [...]



Federal Judge Says Judicial Deference to Executive Branch Agencies Is 'Judicial Abdication'

Thu, 20 Apr 2017 10:52:00 -0400

Newly appointed Supreme Court Justice Neil Gorsuch is an outspoken foe of Chevron deference, the legal doctrine that tells federal judges to tip the scales in favor of executive branch agencies when those agencies have offered a "reasonable" interpretation of an "ambiguous" federal statute. "Under any conception of our separation of powers," Gorsuch has written, "I would have thought powerful and centralized authorities like today's administrative agencies would have warranted less deference from other branches, not more."

An important case decided last week by the U.S. Court of Appeals for the District of Columbia Circuit reveals that Gorsuch has a key anti-Chevron ally on that court. At issue in Waterkeeper Alliance v. Environmental Protection Agency was whether the EPA exceeded its authority under federal law while attempting to regulate animal waste produced by farms. According to the unanimous D.C. Circuit opinion written by Senior Judge Stephen Williams, "the EPA's action here can't be justified."

(image) Among the judges who joined that unanimous opinion was Janice Rogers Brown, a Republican-appointee who has previously exhibited certain libertarian tendencies in cases dealing with such issues as economic liberty, police misconduct, and Amtrak. Those tendencies were on display once again last week.

"I join in the Panel Opinion because '[the EPA's approach] ran afoul of the underlying statutes (and was therefore outside the EPA's delegated authority),'" Judge Brown declared. But she also wrote a separate concurrence, in which she went further, rejecting efforts by the EPA and others to shoehorn lawless executive branch behavior in via the already too lenient standard set forth by the Chevron doctrine. "If a court could purport fealty to Chevron while subjugating statutory clarity to agency 'reasonableness,'" she wrote, "textualism will be trivialized."

Brown concluded her concurrence by observing that "an Article III renaissance is emerging against the judicial abdication performed in Chevron's name." Article III is that part of the U.S. Constitution that grants "the judicial power" to the courts. In other words, what Brown is saying is that certain federal judges are starting to get fed up with judicial deference to the executive branch and starting to wonder whether the time has come to perform their judicial duty to "say what the law is," as Chief Justice John Marshall once put it.

As evidence of this Article III renaissance, Brown pointed to none other than Neil Gorsuch, quoting from then-Judge Gorsuch's 10th Circuit opinion in Guiterrez-Brizuela v. Lynch, in which Gorsuch wrote, "whatever the agency may be doing under Chevron, the problem remains that courts are not fulfilling their duty to interpret the law."

To be sure, Chevron is at no immediate risk of being overturned. But if Judge Brown and Justice Gorsuch ultimately have their way, the doctrine's days will be numbered.




The Hypocritical Logic Behind Republican Plans to Ban Online Porn (Unless You Pay $20)

Tue, 11 Apr 2017 15:30:00 -0400

Draft bills in at least 13 state legislatures would require all internet-enabled devices to come installed with an anti-porn filter, which adult consumers could choose to have removed for a fee of $20. They're calling it the Human Trafficking Prevention Act. The Daily Beast does a nice job today of exposing the huckster behind this legislation, a 40-year-old EDM musician and anti-porn crusader named Chris Sevier who tried to marry his computer in protest of same-sex marriage, was released early from an Iraq tour for mental-health issues, sued Apple over the dissolution of his marriage, and has been charged with harassing a teen girl as well as country singer John Rich. Beyond Sevier's questionable and colorful past, however, a bigger question remains: why are so many state lawmakers—overwhelming Republican—supporting this sort of nonsense? A cabal of legislative cheerleaders from Alabama to Wyoming has embraced the idea that we should require manufacturers of computers, tablets, iphones, smart TVs, and the like to equip devices with the anti-porn filters and require consumers to pay to remove the filters from their devices. South Carolina state Rep. Mike Burns, who co-sponsored one bill in his state, told the Beast that they "do not want more taxes. Period. But we are trying to make a statement, and $20 ain't gonna kill anybody." But of course it's not only monetary costs to consumers that are are a concern. The porn-filter proposal would also impose costs on product makers, and even steeper costs on U.S. civil liberties. "The way it's written, it would cover your router. It would cover your modem," said Electronic Frontier Foundation researcher Dave Maass. "Plus, now Best Buy is sitting on a database of people who wanted their porn filters removed." And then there's question of how the filters would decide what is and isn't porn—content filters designed to catch explicit content have historically been harsh on all sorts of sexuality-related content, from educational websites to news to art. Conservative lawmakers seem to support anti-porn proposals like this one because they please certain segments of their electoral base, give people easy fodder against lawmakers who vote in opposition (how does it look at a glance to be against the Human Trafficking Prevention Act?), and aren't generally a political dealbreaker for those who oppose the plans. The porn-filter laws might irk some or seem silly, but like Rep. Burns said, "$20 ain't gonna kill anybody." This justification might make sense if the idea was simply a tax on porn consumers. But the porn-filter bill is explicitly packaged as a response to porn being a "public health hazard" and "cancer on society" that "perpetuates a sexually toxic environment" in America, normalizes violence against women and children, "portrays rape and abuse as if such acts are harmless," promotes "problematic or harmful sexual behaviors," and "increases the demand for sex trafficking, prostitution, child sexual abuse images, and child pornography." If Republican lawmakers really believe that online pornography is a public health crisis that directly contributes to human trafficking, isn't $20 to access an unlimited quantity of it a bit low? Why shouldn't such a scourge just be banned entirely? Much like liberal counterparts who declare Donald Trump a fascist/Nazi/white supremacist and themselves the #Resistance and then demand more government control of broadcast media, arts funding, etc., conservative lawmakers demonstrate an extreme dissonance of rhetoric and response here. It leaves open three possibilities: Republicans really believe that internet porn is a public health crisis that ruins relationships and directly leads to human trafficking—and also that paying $20 absolves one of moral responsibility for such matters. Republicans believe porn is a public health crisis that causes sexual exploitation and the $20 fee proposal is just a ploy to get the law passed and filtering mechanisms in place with minimal objection, af[...]



Airbnb: Public Enemy No. 1?

Sat, 08 Apr 2017 06:00:00 -0400

New York passed one of the nation's most onerous anti-homesharing laws last year, but residents don't seem to be taking it all that seriously.

There were more than 55,000 Airbnb rentals in the Big Apple on the final night of 2016, the San Francisco–based homesharing service reports, up from about 47,000 on December 31, 2015. That made New York City the world's top Airbnb destination on New Year's Eve, despite the state law that prohibits the advertising of short-term rentals and the threat of $7,500 fines.

It was a fitting end to 2016, a year that saw more people than ever before using homesharing applications such as Airbnb and HomeAway, even as many states and cities cracked down on the practice.

Other cities have been less straightforward about it. In Chicago, short-term rentals are technically legal, but only if homeowners agree to let city inspectors search their property without warrant, for any reason, at any time. Beyond that, the homesharing ordinance passed by the Chicago City Council is so complicated as to be "literally incomprehensible," according to a lawsuit launched by some residents of the Windy City.

Efforts to restrict homesharing are often premised on the idea that government action is necessary to prevent unscrupulous landlords and careless renters from degrading neighborhoods. But that's an argument for enforcing existing anti-nuisance laws, not a reason to create new restrictions on what otherwise law-abiding residents can do with their own property. If renters—either the traditional sort or those using online platforms—are destroying property or threatening neighbors, they should be held accountable. Blanket bans on short-term rentals punish everyone in pursuit of stopping a few bad actors.

Enforcing short-term rental bans also takes police resources away from other, more important duties. Cops in Nashville, Tennessee, refused to enforce an Airbnb ordinance, saying they preferred to focus on stopping actual crime. State judges later ruled the regulation unconstitutional.

New York's ban on homesharing survived a legal challenge last year, but Chicago might not be so lucky. The city is facing a pair of lawsuits, with court dates set for later this spring.

Legislators in Florida, Indiana, Texas, and other states are now crafting laws to prohibit short-term rental bans. That poses something of a dilemma for skeptics of the use of state power to usurp local government. States should be prudent when interfering in how municipal bodies conduct business, of course, but federalism is no guarantee of liberty.

Political fights over homesharing will continue, but the best check against abusive government rules against homesharing might be to do what lots of New Yorkers did on New Year's Eve: Ignore them.




FDA Loosens Its Shackles on 23andMe Personal Genomics Company

Thu, 06 Apr 2017 14:40:00 -0400

(image) Back in 2013 the regulators at the Food and Drug Administration basically shut down the burgeoning field of direct-to-consumer personal genomics when it ordered the genotype screening company 23andMe to stop testing new consumers for genetic health risks. Why? Because the regulators had ginned up some speculative scenarios in which, for example, a woman who tested positive for a deleterious BRCA breast cancer variant would run to her kitchen, grab a butcher knife, and lop off her breasts (I exaggerate slightly.) As a long time and happy 23andMe customer, I was particularly irked by the FDA's nonsensical decision to keep people in the dark about their genetic makeup.

Before the FDA brought its hammer down, 23andMe was developing a wonderful explanatory interface to help customers understand their genetic information. The company provided some insights on more than 200 health risks, drug responses, and inherited traits - and was adding more all of the time.

After 2013, the company was allowed to tell folks what their genes suggested about their ancestry and traits like dry earwax or the likelihood that their second toes are longer than their big toes. (As if anyone needs genetic tests to discern that information.) In their "wellness" reports, the company could inform customers about how their genes affect the speed with which they metabolize caffeine or their tolerance for milk.

Today, the company is announcing that the FDA is loosening its noose a bit and permitting it to tell customers some genetic risk information for ten different conditions, including late-onset Alzheimer's disease, Parkinson's disease, celiac disease and hereditary thrombophilia (harmful blood clots). As an early customer, the company had already provided me with some genetic insights with regard to all of these health risks, plus about 140 others.

Here's hoping that the Trump administration will roll back these unnecessary regulations and free up personal genome companies like 23andMe to provide Americans with access to their genetic information.

To find out what's genetically wrong with me, click over to SNPedia where I have posted the results of my 23andMe genotype screening tests for all to see.




Media: Openly Using a Bill Clinton/Harry Reid Law = ‘Stealth Assault on U.S. Regulations’

Thu, 06 Apr 2017 12:27:00 -0400

As mentioned here previously, the media reaction to President Donald Trump's rollback of some regulations has ranged from panic to laugh-out-loud hysteria. The default assumption of regulatory virtue is heavily skewing the coverage of allegedly impartial news organizations, perhaps suggesting (if unwittingly) that Trump is providing an overdue jolt to a long-comfortable status quo. Your latest example comes from Reuters yesterday: "Window closing for Republican stealth assault on U.S. regulations." Focus first on the word "stealth." Merriam-Webster gets to the point of what that adjective means: "intended not to attract attention." The stealth bomber (pictured, below right), probably the most famous promulgation of the term, was designed (in secret!) to avoid detection by radar, so that it could fly missions without attracting unwanted attention. So what furtive, behind-closed-doors action is the GOP concocting? Uh, openly introducing, debating, and then passing bills in Congress, using a law co-sponsored by Democrat Harry Reid and signed into being by Bill Clinton? The Congressional Review Act, as discussed here last week, certainly wasn't used much during its first two decades of existence—successfully just once, as a matter of fact. That's by design, and through the realities of partisanship. The CRA gives Congress 60 working days from the moment a regulation is published in the Federal Register to reverse it, and functionally that's likely to happen only when the White House has just changed parties. We are nearing the end of the third such window of opportunity, and Republicans have indeed taken it, with 11 successful repeals. (Or "aggressive use of an obscure U.S. law," in Reuters' ominous language.) Since stealth implies obfuscatory intent, and since these repeals have been carried out fully in the open, clearly the more appropriate word would be quiet, which places more onus on the attention spans of the audience, including (especially?) political journalists. The Trump administration throws off a half-dozen major headlines seemingly each day, so it's easy for a dozen mini-deregulations to get lost in the shuffle. But what about that word "assault"? Well, for one, it sure is popular. Politico wrote a month back about "The coming GOP assault on regulations." Trump wants to "codify an assault on regulatory regimes," CNN's Stephen Collinson recently warned. There's "Trump's assault" on the Environmental Protection Agency (The New Republic), "Trump gives his blessing for coal industry to renew its assault on Americans," (Solomon Jones, Philadelphia Inquirer), and on and on. Any linguistic similarity to activist or interest groups is puretly coincidental, I am sure. But do 11 CRA repeals—which were the only regulatory actions referenced in the Reuters article—truly constitute an "assault"? Down toward the bottom of the piece, the journalism undermines the headline: Even though the CRA effort is winding down, [the] brief campaign showed that aggressive use of the law could succeed, and provided Republicans with some modest, but needed successes in a time when they are struggling with larger matters. Who knew that stealth assaults could be both "brief" and "modest"? More importantly, how significant are a dozen regulations in the scheme of things? Turns out, not so much. The regulation-skeptics over at the Competitive Enterprise Institute have for two decades put out an annual publication called Ten Thousand Commandments. The most recent edition found that there were 3,410 new rules written into the Federal Register in 2015, adding to the 90,836 that had been issued from 1993-2014. That comes out to a 23-year average of 11 new regulations per day. So this "assault" on the regulatory state, which by definition sets the Federal Register's affected rules back to the neo-Dickensian days of May 2016, is undoing one entire day's worth of regulatory activity. Even if you assume that t[...]



Stripper Licensing Fees Pocketed by Palm Beach County Employee for Years

Tue, 04 Apr 2017 07:28:00 -0400

In Palm Beach County, Florida, all topless dancers are required to register with county officials and obtain an Adult Entertainment Work Identification Card (AEIC), at the cost of $75 per year. The regulation is ridiculous for a lot of reasons, but at least applicants—many of whom are paid exclusively in cash—were able to pay the government-ID fee with cash, too, making things a little more convenient and a little less privacy-invading. But not anymore, thanks to the alleged actions of one sticky-fingered government employee. "She would just take the cash and not record it in the logs and then we also found that she was altering some of the logs and records," said John Carey, Palm Beach County Inspector General. The "she" here is Anita Pedemey, 54, who had been employed with Palm Beach County for more than 20 years. Since 2013, Pedemy was an administrative assistant with the county Public Safety Department. According to the Office of the Inspector General (OIG) for Palm Beach County, Pedemy "diverted" at least $28,875 (and possibly an additional $3,305) from county coffers between October 2013 and mid-November 2016. The money came from both adult-entertainer fees—approximately 70 percent of which were paid in cash—and court-ordered payments intended for a crime Victims Services Fund. Pedemey was one of several staffers responsible for processing these applications and payments and passing on relevant paperwork and funds. Instead, Pedemey would often pocket cash payments, according to OIG's investigation. Pedemey herself confessed as much to her boss, Palm Beach County Director of Public Safety Stephanie Sejnoha, at the start of the investigation, although the amount she admitted to taking is less than what OIG believes to be the actual amount. After taking the cash, Pedemey "was deleting the record and shredding the files," said Sejnoha. Emails from this time period show Pedemey requesting contact info for local strip clubs and emailing them reminders about the licensing requirements. By way of explanation, she told a colleague that it had "been very slow" at the adult-entertainer ID processing desk. The OIG investigation revealed how Pedemey would alter daily-activity reports to omit records associated with missing money before she submitted the paperwork to accounting. Because she manipulated reports but left the underlying database unaltered, the county still received records of adult-entertainment ID applications even if accounting never received their payments, which means that at least most applicants whose money was taken were still legitimately registered with the county. At least, as far as OIG can tell. Once an ID applicant is entered into the database, any changes are automatically tracked by system software and reported in a master Daily Payment Activity report; checking these reports against those Pedemey submitted to accounting allowed OIG to get at the scope of the missing money. But ID cards can be printed and issued without ever saving the transaction in the AEID database, according to Benjamin Perez, the county's ISS Systems Integrator. This means that it's possible Pedemey printed cards for people and collected their money without ever entering them into the system, a possibility backed up by surveillance footage OIG reviewed. "We believe Ms. Pedemey's diversions of funds may be much greater than what can be determined by the review of [Public Safety Department] records alone," OIG reported. Going forward, people applying for adult-entertainment permits will be required to pay the fee with a credit card or money order instead of cash, Sejnoha said. Demanding strippers be licensed in the first place is a problem, though. There's no legitimate public-safety or consumer-protection element to the requirement—strip club patrons don't care if the woman wriggling on their laps is properly permitted. Government officials have portrayed the[...]



New FCC Rule Could Send TV Back to the Dark Ages of September 2016

Fri, 31 Mar 2017 11:56:00 -0400

(image) Here's how USA Today led its article about a rule change that will probably be adopted next month at the Federal Communications Commission:

TV-station owners may soon go on a buying spree, a consolidation wave that could limit programming options for viewers.

What is the proposal in question? I'll get to the details in a moment. But when it comes to judging how much it might limit your programming options, the key fact is that the rule would undo a regulation adopted in September of last year. Whatever purchases it sets off, we aren't exactly headed for uncharted territory. A more accurate lede would have been "TV-station owners may soon go on a buying spree, a consolidation wave that could end with the way things were six months ago," but I guess that isn't as exciting.

The specific change involves the fact that a single chain of stations isn't allowed to reach more than 39 percent of the country's households. When calculating that 39 percent, regulators used to count outlets on the UHF band as having only half the reach of outlets on the VHF band. Since September, the two sorts of stations have been counted as having the same reach. If the new proposal is adopted, regulators will go back to the old system.

The proposal's opponents say the UHF/VHF distinction shouldn't matter in the era of digital broadcasting. Proponents don't necessarily dispute that, but they suggest that the September change was adopted improperly, that the FCC is likely to lose a current court challenge to the rule, and that the commission should—in the words of FCC Chairman Ajit Pai—"launch a comprehensive review of the national ownership cap, including the UHF discount, later this year." In the past Pai has conceded that the technical reasons for the UHF discount no longer apply, but he also argued that changing it in isolation amounted to tightening the ownership cap through the back door, and that it would be better to consider both issues at once.

Most of this—basically everything but some details of Pai's position—is in the USA Today article, so if you read it to the end you may come to understand that this is essentially a technocratic debate about how to adjust two interdependent rules. But that's all the more reason to bristle at such an alarmist lede. I am capable of responding to regulatory changes at the FCC with enthusiasm, and I am capable of responding to regulatory changes at the FCC with gloom. Temporarily restoring the UHF discount is not going to spark either emotion.




Brickbat: Getting the Shaft

Fri, 31 Mar 2017 04:00:00 -0400

(image) A federal jury has awarded $100 million to the operators of a gravel mine after finding that Sacramento County, California, officials put them out of business with legal and regulatory measures in order to benefit a rival company. Three county officials were also found personally liable. County aggregate resources manager Jeff Gamel was hit the hardest, with the jury ordering him to pay $1 million to the miners.




SCOTUS Agrees That a Ban on Credit Card Surcharges Regulates Speech

Thu, 30 Mar 2017 08:30:00 -0400

The state of New York forbids merchants to impose a surcharge on customers who use credit cards rather than cash, checks, or debit cards, but it allows them to offer a discount for cash. A cash discount amounts to the same thing economically but not psychologically: Calling the difference in price a surcharge draws attention to the fact that credit card companies charge merchants a fee (typically 2 percent to 3 percent) for each transaction, and it probably is more effective at encouraging cash purchases, since people tend to feel losses more than gains. Since the surcharge ban restricts the way retailers communicate prices, five New York businesses challenged it on First Amendment grounds, and yesterday the Supreme Court gave their case a boost by agreeing that the law regulates speech. In 2015 the U.S. Court of Appeals for the 2nd Circuit dismissed the First Amendment challenge, ruling that New York's law regulates conduct—the prices that merchants charge—rather than speech. But as Chief Justice John Roberts points out in a majority opinion joined by four other justices (Clarence Thomas, Anthony Kennedy, Ruth Bader Ginsburg, and Elena Kagan), New York businesses remain free to set their own prices and even to charge cash and credit customers different amounts. But they are not free to describe those prices the way they prefer: The law tells merchants nothing about the amount they are allowed to collect from a cash or credit card payer. Sellers are free to charge $10 for cash and $9.70, $10, $10.30, or any other amount for credit. What the law does regulate is how sellers may communicate their prices. A merchant who wants to charge $10 for cash and $10.30 for credit may not convey that price any way he pleases. He is not free to say "$10, with a 3% credit card surcharge" or "$10, plus $0.30 for credit" because both of those displays identify a single sticker price—$10—that is less than the amount credit card users will be charged. Instead, if the merchant wishes to post a single sticker price, he must display $10.30 as his sticker price. Roberts notes that the plaintiffs have a strong financial interest in steering customers toward cash, since "they pay tens of thousands of dollars every year to credit card companies." In addition to encouraging cash purchases, the merchants "want to make clear that they are not the bad guys—that the credit card companies, not the merchants, are responsible for the higher prices." Since the plaintiffs "believe that surcharges for credit are more effective than discounts for cash in accomplishing these goals," they are seeking permission to talk about prices in a way the law forbids. Having decided that the ban on surcharges for credit card purchases regulates speech, the Court instructs the 2nd Circuit to consider whether the law passes muster under the First Amendment. "The Court addresses only one part of one half of petitioners' First Amendment challenge to the New York statute at issue here," Justice Sonia Sotomayor says in a concurring opinion joined by Justice Samuel Alito. "This quarter-loaf outcome is worse than none." She agrees that the case should be sent back to the appeals court but says the meaning of the statute is insufficiently clear to go further than that. Sotomayor thinks the surcharge ban can be read in at least three different ways: as requiring the same prices for all customers regardless of how they pay, as banning the kind of signs described by Roberts, or as restricting even the terminology used to describe price differences (surcharge vs. discount). Before conducting a First Amendment analysis, Sotomayor says, the 2nd Circuit should ask the New York Court of Appeals for "a definitive interpretation of the statute that would permit the full resolution of petitioners' claims." Justice Stephen Breyer also thin[...]



Danish Deregulators

Tue, 28 Mar 2017 21:15:00 -0400

(image) If you're interested in the shift from Scandinavian social democracy to Nordic neoliberalism (*), you should check out Roslyn Layton and Joseph Kane's new paper on Denmark's deregulation of the telecommunications industry. The Danes, they inform us, have not just shed the state's telephone monopoly but disbanded its telecom regulatory agency, refused to let the government fix telecom prices or push particular telecom technologies, and mostly avoided telecom subsidies.

As is often the case with reforms described as deregulatory, some of these changes did more to rearrange the state's role than to reduce it. (That regulatory agency, for example, had its duties distributed to other arms of the government.) And some weren't really changes at all. ("In Denmark's history there are only three instances of telecom subsidies," Layton and Kane write, "and they are for extremely small amounts targeted to remote areas.") But the net effect was less intervention in the marketplace, not just compared to the past but compared to nearby nations. Despite all the recent liberalization in Sweden, for example, the government there still owns a piece of the country's dominant telephone company.

In any event, it's an interesting case study. It used to be a cliché to suggest that socialism works better in Scandinavia than elsewhere. The best argument that that's true may be the ease with which Scandinavian socialists have moved toward markets.

(* I hate the word "neoliberalism," but alliteration must prevail.)




Trump Reversing Record Number of Regulations

Tue, 28 Mar 2017 17:15:00 -0400

President Donald Trump's big moves today on energy/climate policy, assessed in detail by Science Correspondent Ronald Bailey below, are far from his only deregulatory heaves this week. On Monday, for example, the president signed into law four regulatory rollbacks presented to him via the Congressional Review Act (CRA), or three more than were enacted between 1996-2016 combined. The previously obscure CRA, which Scott Shackford wrote about at length in January 2015, gives Congress 60 working days to reverse any new regulation added to the Federal Register. (That's congressional working days, so in fact the 115th Congress has had the ability to pick off any unwanted Obama-administration reg enacted after mid-June of last year.) The only successful deployment of the CRA prior to Trump came in March 2001, when President George W. Bush signed out of existence a controversial November 2000 Clinton administration rule requiring employers to prevent ergonomic injuries in the workplace. The unified Republican Congress of 2015–2016 presented five CRA rollbacks to President Barack Obama, and he vetoed each one. President Trump now has seven CRA notches on his belt, and more coming his way. The latest, as summarized by USA Today: * The "Fair Pay and Safe Workplaces" rule, which barred companies from receiving federal contracts if they had a history of violating wage, labor or workplace safety laws. That regulation, derided by critics as the "blacklisting" rule, was already held up in court. [...] * A Bureau of Land Management rule known as "Planning 2.0," that gave the federal government a bigger role in land use decisions. The rule was opposed by the energy industry. * Two regulations on measuring school performance and teacher training under the Every Student Succeeds Act, a law Obama signed in 2015 with bipartisan support. The other three CRA reversals so far have been a Security and Exchange Commission rule requiring publicly traded resource-extraction companies to disclose payments made to foreign governments, a Department of Interior framework governing stream runoff of coal mining operations, and a Social Security Administration policy (covered by Scott Shackford here) to share the names of people it classifies as having a mental illness with the federal gun database in order to deny them access to weapons. Other Trump deregulatory activity has included: * His January 30 executive order requiring agencies to identify two existing regulations to kill each time they promulgate a new one. * His February 24 executive order instructing each agency to appoint a Regulatory Reform Officer, who will head up a task force that suggests regulations to euthanize. * His appointment to the Supreme Court of Neil Gorsuch, a judge most famous for his criticism of excessive deference to regulators. * His appointments to the Cabinet critics of and reformers to the departments they now head, including Education's Betsy DeVos, Energy's Rick Perry, Transportation's Elaine Chao, and Health and Human Service's Tom Price. * His nomination of drug-approval-process critic Scott Gottlieb to head up the Food and Drug Administration (FDA), and his three paragraphs in the State of the Union Address talking up FDA reform. * His appointment to head up the Federal Communications Commission regulation skeptic Ajit Pai. There is no doubt that the early Trump presidency has made deregulation a priority. It remains to be seen how much Congress will share that appetite, and how much the administration's efforts will be constrained or counterbalanced by Trump's own meddlesome proclivities into other areas of individual and corporate behavior.[...]



Maryland Has a Bad Beer Bill on Tap

Wed, 22 Mar 2017 13:45:00 -0400

(image) First the good news: The Maryland House of Delegates just passed a bill that would quadruple the amount of beer that breweries are permitted to sell in their taproom. Now the bad news: Those brewers will have to try to squeeze those sales into less time, because the bill would also require them to stop serving by 9 on weeknights and by 10 on Fridays and Saturdays. (Depending on where they're located, they're currently allowed to stay open til either midnight or 2 a.m.) The bill also bans the brewers' taprooms from selling other companies' products.

In other words, the law takes away a lot more than it allows. The aim of all this, apparently, is to protect traditional bars and liquor stores from competition.

This had been one of three rival beer bills in the legislature. The best one would have loosened the restrictions on how much beer the brewers could serve without adding those new controls. The other measure was a cronyist proposal that essentially would have carved out a special privilege for a Guinness brewery coming soon to Baltimore County, upping the amount it could serve in its taproom without offering a comparable increase elsewhere. (Speaking as a local: I'm all for bringing more Guinness to the area, but I'd like the rest of the state's beermakers to have the same rights.) Guinness had actually endorsed the more sensible legislation, but it had this one ready too, just in case. Beer writer Liz Murphy called it the "cover your ass bill."

The legislation will now go to the Maryland Senate, where hopefully it will die. If these new rules do become law, Guinness will be able to handle them, but they'll kneecap a lot of smaller businesses. It'd be a double tragedy: a bill so bad that it drives you to drink, but which also takes drinks off the table.




Relax: Gutting the EPA Won't Make Your Air Dirtier and Water More Polluted

Tue, 21 Mar 2017 14:35:00 -0400

President Donald Trump's proposed cuts in the Environmental Protection Agency's budget "will not 'Make America Great Again', " asserted Conrad Schneider, the advocacy director at Clean Air Task Force activist group. "It will 'Make America Gag Again.'" Schneider and other alarmed activists are conjuring the bad old days of the mid-20th century when America's cities were blanketed with smog and its streams clotted with filth. In his new budget blueprint, Trump wants to cut back Environmental Protection Agency funding by 31 percent and fire 3,200 of agency's bureaucrats. But would such steep EPA budget cuts really unleash polluters to pump out more smoke and sewage? To get a handle on this question, let's take an amble down memory lane to assess the evolution of pollution trends in the United States since President Richard Nixon cobbled together the Environmental Protection Agency in 1970. First, with regard to air pollution, air pollution in most American cities had been declining over the course of the 20th century. Why? Many American cities had recognized the problem of air pollution in the late 19th century. Consequently they passed ordinances that aimed to abate and control the clouds of smoke emitted from burning coal in industry, heating, and cooking. For example, Chicago and Cincinnati adopted smoke abatement ordinances in 1881. American Enterprise Institute scholars Joel Schwartz and Steven Hayward document in their 2007 book, Air Quality in America, that emissions of smoke, soot, ozone and sulfur dioxide had been falling for decades before the creation the EPA and the adoption of the Clean Air Act. For example, ambient sulfur dioxide had fallen by 58 percent in New York City during the seven years preceding the adoption of the Clean Air Act. "Air quality has indeed improved since the 1970 passage of the" Clean Air Act, they claim. "But it was improving at about the same pace for decades before the act was passed, and without the unnecessary collateral damage caused by our modern regulatory system." They attribute a lot of the pre-EPA improvement in air quality to market-driven technological progress and increases in wealth that enabled households to switch from coal to cleaner natural gas for heating and cooking; railroads to replace coal-fired locomotives with diesels; more efficient industrial combustion that reduced the emissions of particulates; and improvements in the electrical grid that allowed power plants to be situated closer to coal mines and further from cities. Even if the Clean Air Act did not noticeably speed up the rate of air pollution abatement, the air is nevertheless much cleaner than it used to be. How clean? Since 1980 the index for six major pollutants, carbon monoxide, ozone, particulates, sulfur dioxide, nitrogen dioxide and lead has dropped by 65 percent since 1980. In the meantime, the economy grew more than 150 percent, vehicle miles increased by more 100 percent, population grew by more than 40 percent and energy consumption rose by 25 percent. And yet, a 2016 Gallup poll found that 43 percent of Americans say that they worry about air pollution a great deal. Schwartz and Hayward persuasively argue, "The public's interest lies in sufficiently clean air, achieved at the lowest possible cost. But federal air quality regulation suffers from incentives to create requirements that are unnecessarily stringent, intrusive, bureaucratic, and costly." Basically, the costs of ever tightening federal air pollution controls are now exceeding their benefits. Since most remaining air pollution (except for greenhouse gases which we will set aside for a discussion at another time) is now concentrated in discrete regions rather than crossing jurisdiction[...]



Good News! A Court Has Ruled This Skim Milk Can Be Called Skim Milk!

Tue, 21 Mar 2017 13:35:00 -0400

(image) Hooray for common sense over really stupid regulatory behavior that is clearly designed to protect entrenched government interests! Skim milk is skim milk!

This calls for a more detailed explanation, obviously. A creamery in Florida, Ocheesee Creamery, has been fighting with state regulators over its skim milk. One might assume that skim milk is simply milk with the cream removed. That's what thinking for yourself gets you. According to the Florida Department of Agriculture, in order to actually call your skim milk "skim milk" in the marketplace you are required to add vitamin A to replace what has been removed from the process.

Ocheesee doesn't want to add vitamin A (or anything else) to its skim milk and has been fighting state regulators. The state wanted Ocheesee to label its milk "imitation skim milk," which is absurdly not true. It is actual skim milk but without added vitamin A. It even offered to label the lack of vitamin A, but it wasn't enough for regulators.

Baylen Linnekin, who writes about food law and food policy issues weekly for Reason, had been covering the case and was even retained as an expert to explain in a report that consumers would not be misled by the fact that Ocheesee's pasteurized skim milk was still pasteurized skim milk regardless of whether vitamin A had been added.

Linnekin also noted that the larger dairy industry was more than happy to side with regulators given the opportunity to keep potential competitors with different kinds of choices out of the marketplace. Note how dairy interests are trying to also convince the feds to prohibit products like soy milk or almond milk from calling themselves "milk," though there's no real consumer confusion here that necessitates government intervention.

A federal judge initially sided with the Florida regulators against Ocheesee, but this week a panel of federal judges reversed the decision on appeal, ruling "The State was unable to show that forbidding the Creamery from using the term 'skim milk' was reasonable" and that Ocheesee was not misleading consumers.

It's also yet another win for the freedom-protecting lawyers of the Institute for Justice, who were representing the creamery in court. Read more about the case here.