The Economist: Too Much Regulation

Sounds like writers for The Economist have been reading some of CEI’s regulatory research. From this week’s magazine:

Two forces make American laws too complex. One is hubris. Many lawmakers seem to believe that they can lay down rules to govern every eventuality. Examples range from the merely annoying (eg, a proposed code for nurseries in Colorado that specifies how many crayons each box must contain) to the delusional (eg, the conceit of Dodd-Frank that you can anticipate and ban every nasty trick financiers will dream up in the future). Far from preventing abuses, complexity creates loopholes that the shrewd can abuse with impunity.

The other force that makes American laws complex is lobbying. The government’s drive to micromanage so many activities creates a huge incentive for interest groups to push for special favours. When a bill is hundreds of pages long, it is not hard for congressmen to slip in clauses that benefit their chums and campaign donors. The health-care bill included tons of favours for the pushy. Congress’s last, failed attempt to regulate greenhouse gases was even worse.

There are lots of ways to simplify the 165,000-page Code of Federal Regulations. All new rules should have automatic 5-year sunsets, renewable by a Congressional vote. An annual bipartisan commission should comb through the books and create a package of obsolete or harmful rules for Congress to repeal. Congress should vote on all “economically significant” regulations, a la the REINS Act.

The list goes on. The sooner Congress and the President get cracking on enacting these reforms, the better off the economy — and unemployment numbers — will be.

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