from the Wall Street Journal, The Golden Goose is on the Run by Bob Funk:
There is a disconnect today between what government experts say about the economy when they crunch the numbers and what employers throughout America say when they make hiring and wage decisions. Businesses, small and large, are holding back. Six years after the Great Recession officially ended, many worry about another downturn and fear new governmental intrusions.
For decades, most businesses operated, innovated and expanded despite what was happening in the nation’s capital, or perhaps even oblivious to it. But now the goose that laid the golden egg is on the run. Free enterprise, which made the economy grow and produced rising wages for middle-income Americans, is under assault.
Too many policy makers evaluate new interventions—labor rules, wage laws, environmental regulations—only by what they hope to accomplish. They do not consider the consequences, the unintended effects, and the trouble that their policies will cause for employers and workers, especially when the burdens are placed one on top of another.
Regulation are often considered, rationalized and justified in a vaccuum. Funk is correct to look at the accumulated effect of a steady stream of regulations. Like bricks in a pick up truck and Stanislaw Lec’s admonition, “every snowflake pleads innocent but it is still an avalanche.”
Regulations and rules roll out for years after its authorizing laws have been passed and forgotten. The difficulties and frustration faced by the businesses affected rarely attract a fraction of the attention the legislation did. There is often a chasm between the intentions and the enactment and results of the legislation.
The first rule of economics is scarcity. The first rule of politics is to ignore the first rule of economics. Money spent to comply with regulations is money not available to hire and raise wages. The stifling effect of the accumulation, uncertainty, and cost of regulation means businesses never start. It is no coincidence that more businesses are closing that starting.