Wednesday, April 27, 2016

How to Fix Connecticut: Regulatory Relief

“The law, in its majestic equality, forbids the rich as well as the poor to sleep under bridges, to beg in the streets, and to steal bread” – Anatole France.

Connecticut must reduce business costs in the next decade. A failure to do so will reinforce the status quo: business flight from Connecticut to more business-friendly states, resulting in fewer jobs and less revenue pouring into the state treasury -- which, as we know from bitter experience, produces budget deficits. The deficits, in their turn, lead inescapably to higher taxes or cuts in services to the state’s most needy recipients of state aid. We live in a state in which politicians captured by special interests are less concerned with the poor who live under bridges than they are with securing the votes of far richer political activists who can turn them in and out of office.

It is much easier politically to reduce a regulation than a tax, because regulatory trimming does not generally impact budgets. Regulations, we know, increase business costs, which is why most businesses regard regulations as a tax on business operations. Both taxes and regulations severely impact business growth and job expansion. Bridge dwellers are those whose plight most dramatically testifies to this elemental economic truth.

Unlike a tax, however, a regulations reduction does not reduce state revenue. And that is why regulatory relief is the easier path to prosperity for politicians whose political souls have been captured by special interests.

Why, it may be asked, are there so many regulations in Connecticut?

There are two kinds of regulations: necessary regulations that do not entail unintended consequences injurious to the public good, and political regulations, the chief effect of which is to advance the political prospects of lean and hungry politicians. It may be accepted as a practical rule of political life that regulations increase in direct proportion to the ambitions of its most ambitious politicians – as witness the political arc of U.S. Senator Dick Blumenthal, once Connecticut’s Bernie Sanders-like Attorney General.

Before Mr. Blumenthal was replaced as Attorney General by the more camera-shy George Jepsen, there was, it used to be said, no more dangerous spot in Connecticut than the ground stretching between Mr. Blumenthal and a television camera. One of Mr. Jepsen’s campaign planks for Attorney General was that he was no Dick Blumenthal: The state’s prospective Attorney General  gave everyone reason to believe that state businesses would no longer be throttled by a mailed fist. Once elected to office, Mr. Jepsen disposed of hundreds of cases left on the back burner by his predecessor, most of them involving businesses left swinging in the wind by Mr. Blumenthal.

Since that time, Mr. Blumenthal has moved to the U.S. Senate, where the creator of the Senate Consumer Caucus now busies himself preventing the Pentagon from paying the National Football League from honoring American troops at sporting events, rather than attending to the usual business of work-a-day Senators – such as, for instance, preventing Iran, the new hegemon in the Middle East, from acquiring the resources necessary to destroy the state of Israel.

Two bills now before the legislature offer some hope of regulatory relief – provided they are not killed by neglect or indifference. One expands the information necessary before state agencies adopt small business regulations, and another authorizes state agencies to forego civil penalties for first time regulatory infractions. Andy Markowski, the capable director of the National Federation of Independent Businesses (NFIB), has spearheaded the measures through the state Senate. The measures, passed by the Senate unanimously, await final disposition in the House.

As might be expected, the job and revenue enhancing legislation is opposed by the usual culprits. According to one news report, the state Department of Energy and Environmental Protection (DEEP) fears the pending legislation will reduce funding used to enforce federal laws and regulations.

Put in a social justice scale, federal funding for Connecticut’s federally inspired regulatory incubus far outweighs a pro-business regimen that would provide jobs to the poor who live under bridges, not to mention tax resources for a state that has spent itself into the poor house. Connecticut is now eating its needy through cuts to necessary services so that state government agencies can live off the fat of federal funding. And, of course, the rest of us highly propagandized simpletons are expected to regard this arrangement as just and equitable.   
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