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Regulations in Relation to Small Businesses (view source)
Revision as of 16:26, 10 February 2016
, 16:26, 10 February 2016→Harmful Government Regulations
Laws, such as the Affordable Care Act and Dodd-Frank are well-meaning, but ridiculously long, convoluted, and complex. "The government's drive to micromanage so many activities creates a huge incentive for interest groups to push for special favors. When a bill is hundreds of pages long, it is not hard for congressmen to slip in clauses that benefit their chums and campaign donors. The health-care bill included tons of favors for the pushy. Congress's last, failed attempt to regulate greenhouse gases was even worse." [http://www.economist.com/node/21547789 Economist]
===Complexity costs moneyCosts Money===
'''Sarbanes-Oxley''', a law aimed at preventing Enron-style frauds, has made it so difficult to list shares on an American stock market that firms increasingly look elsewhere or stay private. America's share of initial public offerings fell from 67% in 2002 (when Sarbox passed) to 16% last year, despite some benign tweaks to the law. A study for the Small Business Administration, a government body, found that regulations in general add $10,585 in costs per employee. It's a wonder the jobless rate isn't even higher than it is. [http://www.economist.com/node/21547789 Economist]
Ways to Reform Regulation:
*"America needs a smarter approach to regulation. First, all important rules should be subjected to cost-benefit analysis by an independent watchdog. The results should be made public before the rule is enacted. All big regulations should also come with sunset clauses, so that they expire after, say, ten years unless Congress explicitly re-authorizes them." [http://www.economist.com/node/21547789 Economist]
*"More important, rules need to be much simpler. When regulators try to write an all-purpose instruction manual, the truly important dos and don'ts are lost in an ocean of verbiage. Far better to lay down broad goals and prescribe only what is strictly necessary to achieve them. Legislators should pass simple rules, and leave regulators to enforce them." [http://www.economist.com/node/21547789 Economist]
