Archive for January 18th, 2011

Obama detached from reality of his regulation

January 18, 2011

President Obama has allegedly given up cigarettes but his op-ed in today’s Wall Street Journal makes us wonder what they’re now smoking in the White House.

In “Toward a 21st-Century Regulatory System,” President Obama rhapsodizes about the value and necessity of balanced regulation. On a superficial level, even the libertarian economist Milton Friedman would have agreed with that sentiment. But of course, details matter and that’s where the President’s argument falls apart.

In one of two concrete examples he provides about regulatory actions his administration has taken, President Obama writes (fantasizes?),

One important example of this overall approach is the fuel-economy standards for cars and trucks. When I took office, the country faced years of litigation and confusion because of conflicting rules set by Congress, federal regulators and states.

The EPA and the Department of Transportation worked with auto makers, labor unions, states like California, and environmental advocates this past spring to turn a tangle of rules into one aggressive new standard. It was a victory for car companies that wanted regulatory certainty; for consumers who will pay less at the pump; for our security, as we save 1.8 billion barrels of oil; and for the environment as we reduce pollution.

The reality is that the car makers have long fought higher CAFE standards. The only way they can meet the standards is to sell enough dangerous and unprofitable small cars to offset the safe and profitable large cars and SUVs sold. As prices are again heading toward $4 per gallon, consumers aren’t paying less for gasoline. And if we’re using less gasoline, it’s only because our economy is in the toilet, not because of CAFE.

The other example the President cited is a new process for approving medical devices. But as those rules have not even been proposed, we’ll have to wait and see about them.

The President also wrote,

But we are also making it our mission to root out regulations that conflict, that are not worth the cost, or that are just plain dumb.

For instance, the FDA has long considered saccharin, the artificial sweetener, safe for people to consume. Yet for years, the EPA made companies treat saccharin like other dangerous chemicals. Well, if it goes in your coffee, it is not hazardous waste. The EPA wisely eliminated this rule last month.

Hey President Obama, the FDA also considers carbon dioxide to be safe for human consumption in soft drinks, yet the EPA is regulating it as a threat to the public welfare under the Clean Air Act. How about rollin’ that one back?

Now that President Obama has lost the ability to jam his agenda through Congress, he will use the regulatory agencies to do the same. No one should be fooled by his rhetoric — which doesn’t make any sense anyway.

Update: President Obama issued today an executive order (i.e., policy guidance to executive branch agencies) entitled, “Improving Regulation and Regulatory Review.” The words sound good (e.g., ” each agency shall ensure the objectivity of any scientific and technological information and processes used to support the agency’s regulatory actions”), but then again, East Germany was also called the “German Democratic Republic” — and it was none of those.

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