Government Regulations: “People Protectors,” not “Job Killers”

(from Robert Reich via Facebook) Every speaker at C-PAC, the conservative rage-a-thon, has condemned government regulations as “job killers.” Wrong. They’re people protecters. Most Americans remember how deregulation of Wall Street led to 2008’s near meltdown, inadequate regulation of off-shore drilling resulted in BP’s blowout, and, more recently, how a leaky storage tank of toxic chemicals made Charleston’s groundwater undrinkable, and GM’s unwillingness to fix faulty ignitions are linked to at least 13 deaths. The fact is, because corporations are under ever-greater pressure to show fat profits, any workers, consumers, small investors or innocent bystanders who stand in the way are endangered unless regulations protect them.

But regulations are worthless if inadequately enforced (Republicans have been slashing the budgets of enforcement agencies) and if penalties for violating them aren’t high enough (rule of thumb: The size of the penalty multiplied by the probability of getting caught must be higher than the profits to be made by skirting the regulation). Regulations can even spur job growth if they push companies to innovate in order to meet their goals (California’s fuel-economy standards, for example, have spawned a new generation of automobiles, along with new jobs).