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Resource Center > Article
All I Want for Christmas Is…Less Government Regulation?
15 Dec 11 Posted by: Kathleen C Lanza
in Featured Articles

Three key pieces of legislation are currently being bandied about in Congress, bringing the debate over government regulation and its effects on small businesses very much into the national spotlight this holiday season. Not surprisingly, the arguments about what the implications of these bills would be as they are currently written and should each of them pass BOTH the House and the Senate pretty much fall out along party lines. Furthermore, and as is so often the case in instances like these, it can be a challenge getting to the truth of what the real impact of passage might look like when accusatory rhetoric, technical jargon and political grandstanding are the norm.

One thing is for certain, more than one-fifth of America’s small business owners cite compliance with government regulations as the most important problem facing them today, according to a recent Gallup poll. At the same time and in the same survey, small business owners concede that while fewer government regulations would be beneficial to their success in 2012, growth and sales increases as well as job creation are equally if not more important.

The big question then becomes whether or not reducing government regulation will in fact foster small business growth, sales and job creation. And if so, then the next question is whether or not the pending legislation will in fact get the job done and at what price.

Proponents of the three bills in question (H.R. 3010, The Regulatory Accountability Act (RAA); H.R. 527, the Regulatory Flexibility Improvements Act and H.R. 10, Regulations from the Executive in Need of Scrutiny Act) argue first and foremost that passing this new legislation will accomplish the following:

• Protect business owners from costly rules and regulations and restore to Congress its rightful control of the regulatory process

• Improve both accountability and transparency while giving small businesses a greater stake in the regulatory process

• Close current loopholes such that regulatory agencies will be forced to consider the indirect cost of their rules on the economy and small businesses in particular and conduct retrospective analyses of existing rules to implement reforms as necessary

• Allow for the adoption of lower cost regulatory options whenever possible

• Address the concerns of America’s small business owners in ways that the current President and his administration have not thus far.

Opponents to the legislation as it is currently written offer the following counterarguments for consideration:

• Congress already controls the regulatory process in that it is the only means by which laws are passed. Furthermore, it is already responsible for the modification, repeal and reevaluation of regulations that evolve from those laws, as well as the budget that drives regulatory implementation and enforcement

• Current law already requires that rulemaking agencies analyze every new rule for its potential economic impact on any number of smaller entities, including small businesses, and weigh that impact against its potential benefits. These new bills serve only to complicate the regulatory process, effectively bringing it to a halt, which will gravely threaten the government’s ability to protect the American people from a wide range of health and safety implications

• This legislation all but repeals the authority of regulatory agencies to waive or delay the required analysis of any rule’s possible effects on business, even when it is in response to a dangerous consumer threat such as an outbreak of food-borne illness or pervasive and fraudulent mortgage-industry practices

• These bills as they are currently written cumulatively represent the first major step in our “regulatory race to the bottom,” which will greatly affect America’s competitiveness over time, undermining our world-recognized high quality and safety standards. This ultimately will have a negative as opposed to positive impact on job creation

• The President’s Executive Order of 2010 already requires regulatory bodies to decrease unjustified economic burdens on small businesses, especially those that would prevent private-sector innovation. However, agencies must also determine if the benefits of those same rules are justified given their potential cost to society as a whole.

Whether pro or con, political pundits predict that these legislative initiatives will most likely go nowhere before the 2012 elections―signifying once again that our greatest wish as Americans this holiday season should perhaps be for a Congress that can actually get something done.

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