Five Fundamental Facts about Standards and Public Protections
by Sam Abbott, 7/17/2013
Judd Gregg, a former Republican senator from New Hampshire and current CEO of the Securities Industries and Financial Markets Association (SIFMA), recently wrote an opinion piece for The Hill attacking new environmental and public health standards and financial protections. Gregg’s article is the latest volley in an orchestrated assault on the regulatory system by regulated industries.
In his piece, Gregg overlooks five fundamental truths about the role of regulations in the U.S. economy.
1. Standards and safeguards save lives at home, at work, and on the road: Ensuring safety and freedom from harm should be the utmost goal of government. Since the 1970s, regulatory agencies have made the American people safer on the job, at home, and in transit.
- Safety standards on children’s strollers set by the Consumer Product Safety Commission have resulted in a 91 percent decline in stroller-related injuries between 1999 and 2012.
- Rules issued by the Occupational Safety and Health Administration (OSHA) have resulted in a 68 percent decline in fatalities at the workplace between 1970 and 2011,
- Thanks to vehicle safety standards set by the National Highway Traffic Safety Administration (NHTSA), motor vehicle deaths have declined 36 percent since 1980.
These instances represent hundreds of thousands of lives saved thanks to smarter public protections.
2. Safeguards benefit the economy and save public money: Standards and safeguards have dramatically benefited the economy. In 2013, the Office of Management and Budget (OMB) submitted a draft annual report to Congress on the costs and benefits of federal regulations, which showed the benefits produced by public protections outweighed their costs by as much as ten to one.
Between October 2002 and September 2012, regulations yielded approximately $193 billion to $800 billion in benefits while costs ranged from $57 billion to $84 billion. What’s more, OMB often underestimates the benefits of rules, meaning that savings from regulations could be even greater than reported.
It is also important to remember that the costs of failing to regulate can be significant. Weak regulations and a lack of oversight may have contributed to the BP oil spill off the Gulf Coast, which cost the nation up to $63 billion. The 2008 collapse of the deregulated financial services industry has cost Americans at least $12.3 trillion so far.
3. Small businesses view regulation as essential for fair competition: Despite assertions of anti-regulatory critics that claim to speak on behalf of small businesses, America’s small business owners understand and support the important role regulations play in creating a safe and fair economy. According to a 2012 poll by the American Sustainable Business Council, 83 percent of small business owners see regulation as necessary, and 78 percent of small business owners believe that regulations help protect them from unfair practices by larger corporations.
4. Regulation can create jobs: Establishing new environmental and health standards can create new markets for goods and new jobs. For example, when a growing number of construction accidents involving workers prompted new rules on the use of safety harnesses, a new safety equipment industry was established, which created new manufacturing jobs.
In another instance, coal mining jobs in the Appalachian Mountain region increased by 10 percent after the EPA cracked down on mountaintop removal mining in 2009. As the Obama administration continues to address the issue of climate change, experts expect the economy to add hundreds of thousands of new jobs every year in pollution abatement and green energy.
5. Crucial improvements to public health, safety, and economic security standards are being delayed: Vital standards and safeguards are languishing at the White House’s Office of Information and Regulatory Affairs, preventing Americans from benefiting from protections. For example, the U.S. Environmental Protection Agency’s (EPA) rule on the disposal of coal ash has bounced between the White House and the EPA for nearly four years, leaving Americans susceptible to a repeat of the disastrous 2008 spill in Kingston, Tennessee. New food safety rules required under the Food Safety Modernization Act have been delayed and weakened while under review at the White House, resulting in unnecessary foodborne illnesses.
The debate over the role government should play in our everyday lives is important. It forces us to confront our values and priorities as workers, employers, voters, and consumers. But the American public needs to have the facts about specific rules and protections when we discuss how to ensure greater economic security, a cleaner environment, and a healthier and safer nation. Focusing on the rulemaking process without mentioning the common goals standards are meant to achieve presents an incomplete and misleading picture.
Editor's note: This post has been updated since it's original posting date.