One Rule at a Time
The right way to cut government red tape.
Mar 26, 2012, Vol. 17, No. 27 • By ELI LEHRER
Just about every poll on regulatory issues shows many Americans hold contradictory views. By growing majorities, Americans say they oppose “government regulation” (more than half tell Gallup that government regulates “too much”). However, when pollsters ask about broad areas of regulatory policy, like the environment, education, or finance, Americans say they want the government to do more. Perhaps because of these contradictions, politicians rail against government regulation on the campaign trail but almost never do much about it once in office. Deregulation requires a different approach, one that looks at opinions about particular regulations.
When it comes to specific regulations, like certain chemical bans or price controls on insurance, polls show Americans do, indeed, want government to do less. Political leaders intent on regulatory reform, therefore, would do well to accept regulation in many areas of life while working to draw attention to the negative consequences of particular regulations. Remedies as a result are likely to be piecemeal rather than wholesale.
Politicians’ current approach involves lots of bold-sounding proposals that go nowhere. Newt Gingrich says he wants to abolish the EPA (the most intrusive regulator by many accounts) in its current form. Mitt Romney promises vast financial deregulation. Rick Santorum says he’ll end the 2010 health care law by defunding the regulations that sustain it. Even President Barack Obama has declared that regulations “have stifled innovation and have had a chilling effect on growth and jobs.”
Prevailing public opinions suggest hardly any of this is likely to translate into real changes in public policy. A 2011 survey from the Pew Research Center for People and the Press, for example, shows a majority wants stiffer environmental regulations. A Gallup poll taken in 2010, near the height of Tea Party anger with the Obama administration, likewise shows that more than 60 percent of Americans support stronger regulation of financial institutions.
This helps explain why deregulatory pushes so often peter out. While Congress gave itself the power to disapprove any regulation under the 1996 Congressional Review Act, the law has proven a dead letter. In 16 years, Congress has attempted to use it six times, and only once successfully. (That came when Congress disapproved Department of Labor workplace ergonomics regulations in 2001.)
But this doesn’t mean deregulation is a lost cause. Even people who say they want more regulation will often express a different opinion when confronted with the specifics of a given rule. Examples abound. A poll conducted by Lincoln Park Strategies on chemical regulation showed that almost 70 percent of voters rejected chemical ban schemes based on the EU-adopted “precautionary principle” that bans chemicals even if they are not proven unsafe. The same poll found that chemical manufacturers themselves were more trusted than political leaders when it came to deciding regulatory bans.
This type of overbroad just-to-be-safe ban—currently being considered on the chemical Bisphenol A (BPA)—is a key example of a regulation with real costs that lacks support. Right now, environmental activists have forced the FDA to rule on banning BPA for use in food applications by March 31. But a BPA ban would privilege speculative benefits over real detriments to human safety: BPA is the key component of shatterproof children’s products and epoxy linings that keep bacteria out of canned foods. As such, a BPA ban is just the sort of move that could become unpopular and arouse public resistance to the regulatory state.
And BPA isn’t alone. Steve Pociask of the American Consumer Institute, which has done dozens of polls on Americans’ attitudes toward government regulation of everything from energy development to cable television to North Carolina auto insurance, finds an obvious pattern. “People want oversight from the government, they favor regulation in the abstract,” he says. “But when it comes down to specific new rules and regulations, they tend to be very skeptical and, more often than not, opposed. Particularly when you explain it to them.”
Pociask’s reserve of polls—several hundred questions over the past five years—shows a great many proposed regulations are unpopular when they are described. Pollster Scott Rasmussen also has identified widespread sympathy for deregulation of small business.
The disconnect may be easy to explain. Many people favor government doing something about a wide range of social problems but are skeptical of particular proposals. “Something,” in fact, can mean any number of things, including efforts to improve and streamline enforcement of rules already on the books.
Some questions about regulation may really be tests of respondents’ overall faith in government. In a 2010 Pew poll, only 22 percent of Americans said they trusted the government to do what was right all or most of the time. That is nearly the same as the 24 percent that told Gallup pollsters around the same time that they generally favored more regulation of business.
Of course, some regulations will prove popular. While President Obama’s health care plan is unpopular overall, many of its specifics aren’t. Rules to prevent insurers from refusing coverage for preexisting conditions receive such overwhelming support that even the Tea Party-inspired “Pledge to America” that served as a 2010 Republican congressional campaign manifesto includes a commitment to implement them.
Except as a synonym for “distrust in government,” supporting deregulation does not produce votes in most cases. This may not be an altogether bad thing. Only a small libertarian fringe would propose government ditch all meat inspections, solvency protections to make sure insurers pay claims, or the entire web of regulations tied to bank deposit insurance. Outside of thought experiments by economists, there are no practical proposals to replace these things with purely free market solutions anyway.
So the American people want certain types of regulation but distrust the government to implement regulations correctly and tend to dislike a wide variety of specific regulations. Proposals like the House-passed REINS Act—which would subject major regulations to specific votes in Congress—might therefore make a difference, if only by bringing more absurd regulations into public view.
In short, proponents of deregulation ought to be cautious about ineffective frontal assaults and instead focus their efforts on specific bad regulations. Doing so would almost certainly free the economy more effectively than generic attacks on the regulatory state.
Eli Lehrer is vice president of the Heartland Institute.