Is regulation killing American innovation?

Christine Hall.

"The federal government micromanages American businesses and citizens through excessive and costly regulations. These rules stifle innovation, limit competitiveness, and hinder job creation, while also making it harder for ordinary people to build financial security and improve their quality of life. CEI President Kent Lassman and Neil Bradley of the US Chamber of Commerce discussed problems and solutions in a September 22 online event titled Free Enterprise Exchange: Is regulation killing American innovation?

Key takeaways include…

Regulation goes too far. Instead of setting standards for the private sector to meet (such as health, safety, and the environment), too many regulations are aimed at coercive control, dictating how resources are used.

Regulation costs too much. Regulations cost over $2 trillion annually–about a third the size of federal taxation, spending, and borrowing combined.

Regulation is a hidden tax on homeowners–as are tariffs. Red tape, mandates, and now tariffs needlessly add thousands of dollars to the cost of buying or building a home, buying or replacing appliances, and re-roofing a house, for example. These burdens accumulate during everyday life.

Regulations are hardest on small businesses. Compliance costs fall disproportionately on small firms and new entrants. Big firms can spread costs across many operations, but regulations can shut out startups before they begin.

Regulations undermine our global competitiveness. US businesses now face regulatory environments so burdensome that some companies report it is faster to get permits in Europe than in the US.

Government ownership of businesses is a problem. Business leaders will start making decisions not in the best interests of the customer or their business but in the best interests of the government ahead of the next election. Control of private enterprises by the state is the death knell of dynamism.

Congress has regressed. It’s become less effective at its core mission of developing and adapting our legal code to the way Americans live, which is another way of saying ‘they can’t do anything up there.’

Congress must hear from the business community. Lawmakers need to hear from business leaders, such as members of the US Chamber of Commerce, in favor of bills to deregulate, increase regulatory transparency, and eliminate burdensome, unneeded commissions, bureaus, and boards.

1970s era deregulation was an example of success we can emulate. Deregulation of airlines, trucking, and rail in the 1970s (led by bipartisan figures like Ted Kennedy, Alfred Kahn, and Steve Breyer) showed that lifting heavy regulation produced cheaper prices, better service, and more safety.

View the full discussion with Neil Bradley and Kent Lassman on YouTube."