By Peter Galuszka

“They’re coming out with multiple, onerous regulations,” says Mike Bucci, a small business owner in Richmond, according to a visual runby Chief Baconaut James A. Bacon Jr., as part of a blog posting titled”Paperwork, Solar Panels, and Job Creation.”

Mr. Bucci complains that his small business, which comes up with business solutions, was stymied because he had to go through a lot of paperwork to export some products. He did not, however, go into details and didn’t say, for instance, if it was the U.S. government that was requiring the paperwork or perhaps the customs people of the nation where he was shipping. It apparently didn’t matter, because accouding to those mantras that our James A. Bacon Jr. so likes, it shows over-regulation and the big, bad government.

So, it was with considerable curiousity that I noticed a report by McClatchy publications, prepared by reporters from the Charlotte Observer, The Kansas City Star, The Miami Herald and the Sacramento Bee, among others, stating that their survey of small business owners had no particular problems with government regulations.

On the contrary.”Govenment regulations are not ‘choking’ our business, the hospitality business,” says Bernard Wolfson, president of Hospitality Operations in Miami.

In Charlotte, Rick Douglas, owner of Minit Maids, likewise saw no deluge of regulations although he did complain about workers’ compensation claims. In Gulfport, Miss., small business woner Rip Daniels says his problem is not regulations but the difficulty of getting business insurance. He credits Washington’s stiumulus with keeping small business afloat.

So, we have a very different perspective than that promoted by The U.S. Chamber of Commerce which tends to represent big corporations capable of helping pay for the Chamber’s ornate and museum-like headquarters just across a square from the White House in Washington.

Besides getting insurance from private carrier, a huge problem for small business is getting capital to expand. Crushed by their excesses in subprime mortgage lending, many big banks are protecting their loan-making ability like jealous mother hens. They have been taking a beating for years and are making lenders pay. Bank of America, which had to absorb Merrill Lynch and Countrywide, a major subprime lender, is about the lay off 30,000 people.

They are not really all that interested in lending money to small operations. Curiously, under Obama, the U.S. Small Business Administration has doubled its lending through a program that helps small businesses find loans with reasonable interest rates that are backed by the U.S. government.

Why are they doing this? Presumably because private lenders are not doing it.

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13 responses to “The Over-Regulation Hoax”

  1. The Bucci video was produced by an initiative of the National Federation of Independent Businesses — not the U.S. Chamber of Commerce. I’ve got a question for you: Why would the NFIB spend big bucks of its members’ money to inveigh against regulations unless a large number of their members were really bent out of shape about regulations?

  2. Peter Galuszka Avatar
    Peter Galuszka

    I never said that the U.S. Chamber put out the video.
    As far as the NFIB, I have no idea, I guess you’d have to ask them. It strikes me as sort of knee jerk — sort of like the Richmond Times-Disgrace running a self-serving “commentary” for Labor Day by the National Right to Work Foundation decrying unions which, of course, is what we’re supposed to be celebrating on Labor Day.
    Unlike you, Jim, I do not take lobbies and advocacy groups, especially right wing ones, at face value.


  3. Didn’t liberal superman Obama just cancel clean air regulations saying that he didn’t want to trouble the states with the matter until it comes back up in 2013. Just last month his own EPA Administrator told the Senate that the current standards (which Obama wants to leave unchanged) “were not legally defensible given the scientific evidence.”.

    Barack Obama was a typical shrill liberal when he came into office in 2009. He was going to right society’s wrongs, establish universal health care, have the government end the recession and clean up the planet.

    A funny thing happened … reality intruded.

    That happens a lot when Liberals are forced to confront the facts. Even Democrats begin to question the scope and nature of government regulations for example.

    Barnie Day wrote a great piece about Virginia’s regulations some time ago. You can read it here:

    When Democrats like Barack Obama and Barnie Day start sounding like the Chamber of Commerce, there’s something going on.

    When will you and Keith Olbermann catch up, Peter?

  4. Peter Galuszka Avatar
    Peter Galuszka

    Speaking of reality, I didn’t invent the McClatchy report. I even listed the link. You avoid mentioning it. Why?


  5. The Great Hoax is what’s going on. The bankers aren’t lending money because they are amassing cash to defend themselves both civilly and criminally. They aren’t lending money because the banking system itself is going down the tubes. The European banks are quietly shipping their corporate cash here, leaving the individual depositors there holding the bag for the ultimate collapse. Other countries are taking possession of gold and other commodities, exchanging paper assets for physical. In short, they are circling the financial wagons for a structural reset while the TV watchers think everything is just dandy. You ain’t seen nothing yet.

  6. This time it is different. Recessions come and go but what we have here is not a recession. It’s a structural deficiency. Look at this chart for just one example.

  7. “Speaking of reality, I didn’t invent the McClatchy report. I even listed the link. You avoid mentioning it. Why?”

    It wasn’t a report. It was a random collection of stories. One said insurance was hurting his business, another said workers’ comp. Then came federal loan limits and even the internet.

    I run a small business and regulation isn’t keeping me from expanding. However, when I real articles like the one published by Barnie Day I wonder if that’s true for other businesses.

  8. Darrell:

    Personally, I think that chart is a bit disingenuous. It shows the speed of job loss rather than the total extent of job loss. The 1980-1982 recession pushed unemployment to 10.8%. This one peaked at 10.2%.

    However, the chart has a more subtle message that should be very worrisome. Look at the last 3 recessions. Look at the shape of the recovery. Earlier recessions saw rapid declines in economic activity and employment followed by rapid rises in economic activity and employment. The last recessions have been much slower to rebound.

    I agree that the US economy has a structural deficiency but I don’t think it’s just this recession. It’s the entire economy over the last 25 years. And what one factor has happened over those 25 years? Interest rates have been up and down. Inflation has been up and down. The money supply has been up and down. Offshore outsourcing has been nothing but up.

    I fear that the real culprit is not the Bush tax cuts or Obama’s failed stimulus program. I fear that the real culprit is the loss of jobs to technical innovation and offshore outsourcing faster than the US economy can adapt to those job losses.

    Many will quote theory. They will claim that technological improvement is always good for an economy. They will claim that shipping jobs overseas allows for more focus on innovation and invention at home. These people need to climb down from their ivory towers. No society and no economy can change instantly. When the cumulative rate of change exceeds the economy’s ability to adapt chaos ensues. That is what I believe is happening.

    Ed Risse’s Enough? draft (available on his web site) includes a description of import replacement capacity. I think that concept will end up being the explanation for why America can no longer quickly recover from recessions.

    One day we will hit a recession from which we will never recover. Perhaps that day is here.

  9. Latest cencus cencsus data (2008) show 6 million businesses with employees and 22 million with no employees. Second stage companies with 10 to 99 employees employ half the workers and have been in business 15 years. The other half are employed by. 118500 LARGE firms.

    When you listen to election year maladjusted about how iwe need to enable small business and the wealthy job creators by not taxing them, remember it is going to take 15 years to see those jobs.

    If supply side theory is correct.

  10. Sorry, should read 18,500 large firms.

  11. funny how Groveton views Obama’s changed stance on air quality regs as “reality intruding”.

    I’d call it a political calculation. I do not think that Obama or the EPA or the American Lung Association or any of the other advocacy groups have changed their minds because of ‘reality intruding”.

    In fact most are dismayed by Obama’s reversal… but it’s clear to me that it’s all about politics….

  12. one of the insipid problems with the regulation argument and especially so attributing it to Obama is that it’s simply more disingenuous propaganda emanating from those who have ALWAYS been opposed to virtually any/all regulation that affects them except now it’s take to a higher level to personalize it against this particular President.

    I’d like to hear from a small businessman as to what percent of regs are Federal and what are State – and what new ones that have come online are brand new ones that are directly the result of this particular Presidents specific laws he wanted verses ones that have been in the pipeline…

    this anti govt/ anti regulation / anti – Obama narrative combined with virtually no counter or compromise proposals basically is in my view your just plain ordinary political Vandalization.

    I say this because it doesn’t matter where the proposed reg came from… or why… or a middle-ground – it’s treated as if ANY regulation is ALWAYS a bad thing and that THIS president is responsible for any/all regulations that happen on his watch… even if he had virtually nothing to do with them and they’ve been in process for years….

    Some would have the govt stop regulating… period..

    but instead of honestly admitting that they hate any/all regulation no matter what kind or where it came from or why… we’ve entered a period where we have no solutions… just blame…

    99% of regulations come about because someone felt they were being harmed …. and not just one or two people – enough people that a good number of elected Representatives not only agreed but submitted legislation… which is where regulations come from..

    the guy who feels that his hobby dairy business should not be regulated is countered by the parents of the child who got seriously sick from such dairy products.

    there are two sides to the issue but the average person who hears that guy railing about govt squashing the little dairy owner is not going to be sympathetic to unsafe products consumed by their kids.

    when thousands of people suffer adverse health effects from being downstream of a power plant and new regulations are proposed – the anti-regulation idiots basically disbelieve the facts.. don’t want to know that people actually have health problems because they are so fixed against regulation…

    regulation sucks.. ESPECIALLY one-size-fits-all ham-fisted regulations – no argument here.

    but what’s your Plan B? no regulation at all?

    that’s the problem with the critics… no solutions… just blame…

  13. Why do we have pages of regs as to what constitutes a proper escort for a wide load?

    First, because some business hauling a wide load hurt someone, through careless activity in search of money.

    Second, because someone hired to operate an escort got someone hurt through careless activity in search of money.

    Business will have fewer regulations when they are more responsible.

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