In part II of analyzing Mr. Romney’s 59 point plan, we will analyze and comment on his regulatory policy. Short version: regulations bad, industry good. The general theme is that anything that stops business from exploiting the public or ravaging the planet is onerous and must be eradicated. Romney goes on to push for cost benefit analysis on every regulation before it is approved. Sounds great, but how do you calculate the benefit of air quality 100 years from now? What is the cost to healthcare when our drinking water is contaminated? You get the picture.
The quotes and italics are the actual words from the Romney plan and the plan uses Romney in the third person (“Jimmy likes Elaine”).
· “The Obama administration’s war on carbon dioxide – what Time magazine has called “the most far-reaching environmental regulatory scheme in American history”. Fact is every industrial nation from Australia to Canada and from America to Belgium all have ‘schemes’ to cut carbon dioxide. In fact over the last five years America has recorded a decline in greenhouse gas emissions totaling 450MILLION tons, the biggest in the world. Is it due to excessive regulation? No it is due to the emergence of natural gas. Further, the attack on coal has nothing to do with carbon dioxide. The Clean Air Act addresses emissions of sulfur dioxide, nitrous oxide, and mercury NOT carbon dioxide.
· “Regulatory costs need to be treated like the very real costs they are.” Yes implementing and complying to regulations can be costly. So can Wall Street bailouts, Great Recessions, super fund site clean ups, mine collapses, oil rig explosions and spills, poisoned water, contaminated food supplies, toxic air… get the point? Long term analysis of costs and cost avoidance are legitimate aspects of a cost-benefit analysis, but to read this plan, one would think that regulations offer no benefits.
· “On his first day he (Romney)in office, he will issue an executive order paving the way for Obamacare waivers for all 50 states.” And the right calls President Obama an overreaching tyrant? Does this mean that the individual counties in Massachusetts should have been granted waivers from Romneycare? Seriously, this is a ploy by a candidate who can’t run from his past; his past as the father of universal healthcare. For the record, the Obama administration has granted waivers to states, like Romney’s Massachusetts, that have established compliant alternative plans to the Affordable Care Act.
· “The government’s response was to layer on new regulations and invent new bureaucracies that do not address the underlying causes of a crisis driven by the over-leveraging of our financial institutions and our homeowners.” Romney takes the Wall Street stance that the share of the blame is equally spread between homeowners and banks, and in the process fails to address the lax securities regulation, the government sponsored entities of Freddie and Fannie. Higher capital reserves and tighter lending standards were the no-brainers. The real work involved shining light on the secretive derivatives markets where bad mortgages became mortgage backed securities, and MBS became toxic CDO’s and CDS. The CFTC with its expanded powers will provide the necessary oversight in the futures, credit card, and derivatives market. Still think we are over-regulated? The ongoing LIBOR scandal, JP Morgan Enron-like energy fixing, and the recent fines against Goldman Sachs and JP Morgan are further evidence that the markets cannot regulate themselves.
· “Romney will seek to amend the Clean Air and Clean Water Acts to ensure that cost is taken properly into account at every stage in the regulatory process.” Fair enough. Will the long term costs and effects of greenhouse gases, contaminated aquifers, and mercury be considered? Yes reasonable assessment of regulations that consider severity, detection, and likelihood is sound policy. The difference is Romney and his ilk are prone to consider only the costs to business, not the costs to society and the environment.
· “As president, Mitt Romney will pursue reforms that respect the federal-state balance of powers in our court system while creating a legal environment conducive to economic growth.” Mr. Romney seems to forget, or never believed, that the courts are the last bastion for Joe Citizen to get justice. The Republican mantra of tort reform is a red herring and this business of state versus federal courts is nothing but misdirection. Corporations through the ALEC organization have bought the executive and legislative branches, leaving the judicial avenue as the last path for citizens to seek and obtain fairness, justice, and yes, a pound of flesh when warranted.
No surprise that Romney is taking a pro-business perspective. What is disappointing that he has taken such an instant gratification approach to problems at the expense of long term considerations. Oh yeah, he’s a politician and a businessman. Romney’s regulatory approach is short sighted and filled with imaginary boogeyman in the form of the EPA, SEC, HHS, and FDA. I’m no tree hugging envirowarrior, but a citizen who believes business doesn’t deserve a preferential treatment over this nation’s citizens and ecology.
Up next Trade Policy and the Great Satan China.