Wednesday, October 26, 2011

Do regulations always work as the authors claim?

One of the most enduring of Holy Doctrines from the Progressive Era is that "experts" employed by the government are wise and discerning, and new regulations, be they for finance or the environment, always work exactly as they are supposed to do. Thus, any new edict from the Environmental Protection Agency will do exactly as it says, creating a cleaner country and reducing pollution and negative health effects.

In a recent blog post, Paul Krugman continues this Progressive tradition of bowing to regulation in an attack on recent remarks by Republican Congressman Paul Ryan. First, Ryan's quote (responding to an attack by President Obama):
Just last week, the President told a crowd in North Carolina that Republicans are in favor of, quote, “dirtier air, dirtier water, and less people with health insurance.” Can you think of a pettier way to describe sincere disagreements between the two parties on regulation and health care?
True to form, Krugman responds by declaring that Obama MUST be telling the truth because, after all, according to The Great One, Obama's remarks are "a literal description of GOP proposals to weaken environmental regulation and repeal the Affordable Care Act".

One has to understand a few things about Krugman's statement. First, does he consider ALL environmental regulation ALWAYS to be good? For example, if the EPA tomorrow were to ban all private automobiles, would that in the end lead to a cleaner -- or dirtier -- environment?

Regarding ObamaCare, is he claiming that this law actually will result in MORE people receiving medical care? I don't see how that is possible, given that doctors will be under more scrutiny than ever, both with regulations AND criminal penalties, and they will spend more time than ever doing paperwork. (Talk to someone in a medical office and that person will give you a lot of information on just how much extra work government regulations create -- and labor is a scarce thing.)

Furthermore, what good is "access to insurance" if one cannot see a doctor? In some places in Canada, they literally have lotteries to see who is able to see a physician, which means the medical care is "free" (not paid directly, but indirectly through taxes) but for many people, unavailable.

As for environmental regulation, one of my areas of specialization has been environmental/resource economics, and one of my mentors, Bruce Yandle, has done a lot of research on the ACTUAL effects of environmental regulation. This point is important, because, unlike Krugman, Yandle has sought out to find out what really happens with regulation, as opposed to Krugman, who claims simply that a regulation always accomplishes its purpose -- if the correct party is in power.

Yandle always taught us to look beyond the rhetoric and the claims and examine the rules and the results. In a recent article in Regulation, Patrick Moffitt and I have done just that in a study of the new environmental regulations for Barnegat Bay in New Jersey.

Interested readers can look at the piece in its entirety, but from what we have found, the new regulations and restrictions are coming about because the EPA and the New Jersey Department of Environmental Regulation (where Lisa Jackson was before she became Obama's choice to head the EPA) are targeting "nutrients" (and especially nitrogen) have misdiagnosed the cause of the bay's demise. This should not be surprising, given that much of so-called environmental science today is utterly politicized.

In fact, both Moffitt and I are convinced that the directives of the EPA and the NJDEP will make the waters of Barnegat Bay MORE polluted and less productive than if these agencies had done nothing. I know, that is politically incorrect.

I found out just how politicized it was 20 years ago when I researched the EPA and acid rain, and it was made clear then and is even more so now that when the EPA funds scientific research, it EXPECTS results that are in line with its political leanings. I'm not kidding nor exaggerating, and have talked to EPA scientists who say that if good research contradicts the EPA narrative, then the research is ignored or suppressed, and those that insist on doing it find their careers in jeopardy.

So, instead of examining the results of regulation, Krugman simply looks at the so-called intentions of the framers of the rules, and then claims that anyone who disagrees with the regulations does so because he or she wants people to get sick and die. But, then, Krugman says the same thing about anyone who thinks the Keynesian narrative is wrong; the only people, according to Krugman, who disagree with Keynesian analysis are those who want others to lose their jobs, their homes, and maybe their lives.


Dan said...

When it comes to the progressive movement, it's very simple, regulations good, corporations bad, and government good. Naturally any attempt to disprove the harmful nature of government regulations on the economy leads to the accusation of being a corporate lover. Very hard to reason with people when ideology trumps facts.

Nathan P said...

Perhaps more importantly, is our children learning? (ahem, check your title for subject/verb agreement)

dchamil said...

The caption of this post, "Does regulations ..." commits a grammatical infelicity.

William L. Anderson said...

Fixed it. That was an error that was SO obvious that I missed it. I was thinking about regulation in general AND individual regulations at the same time. Not a good idea.

Anonymous said...

Somehow Anderson draws the conclusion that Krugman believes all regulation to be bad, and then criticizes him for this broad assumption.

In the next paragraphs, Anderson seems to conclude the exact opposite (surprise, surprise!), but in this case the broad generalizations are just fine.

Pot calling the kettle black here

Anonymous said...


No where did I find an assertion from Mr. Anderson's post that "Krugman believes all regulation is bad."