Regulation in the U.S., always a nuisance, has reached staggering proportions and promises to squeeze the life out of the American economy. It has been made more acute during the Obama administration owing to the Affordable Care Act and Dodd-Frank, but only because it has become over-the-top. Sarbanes-Oxley, passed under Bush 43 was almost as bad.
Last week, The Economist published its article, “Over-regulated America: The home of laissez-faire is being suffocated by excessive and badly written regulation.” As examples of how rampant regulation has become, the article points out three absurd examples in the U.S: children cannot sell lemonade without licenses in Maryland, healthcare regulations have three diagnosis codes for injury sustained while on flaming water-skis, and healthcare regulations have nine diagnosis codes for injuries caused by parrots.
None of the above regulations are necessary. While they are obviously ridiculous, these regulations are indicative of the number of regulations in the current marketplace.
The article suggests simplification of the rulebook, close attention to cost-benefit analysis, and sunset clauses for all big regulations.
If the left-of-center editorialists at the Economist begin to notice how corrupt the dead hand of regulation has become, it must be truly staggering. If left unchecked it could kill any hope for prosperity for decades. And worse, it will impair opportunities for younger generations, which is unconscionable–a point the Economist should also have made.