Roberts Report: Regulation, not government, is choking business

By Alexander Roberts

2 Comments

The recent debate, “Is Government Choking Business?” sponsored by Westfair Communications, raised awareness about an issue that has been much in the news. It featured a debate between Westchester County Executive Rob Astorino and former Wall Street executive and Greenwich author Walter Raquet representing the “pro” side and former Democratic New York state Assemblyman Richard Brodsky arguing against.

Unfortunately, it’s difficult in just over an hour to settle the issue, especially when it starts with a false premise. It’s not government that is choking business, it’s regulation.

Government, all of the panelists agree, serves an important purpose by keeping our water and food safe and protecting us against threats, foreign and domestic. Raquet hypothesizes that all-powerful boards composed of business executives would streamline government and eliminate wasteful regulation.

It’s interesting those all-knowing board members would include people like Jack Welch, whose stint at GE included the elimination of 100,000 jobs and accounting fraud charges, settled with a $50 million fine. In addition, let’s not forget that deregulation of the financial industry in the 1990s set the stage for the Great Recession. The point is business does not hold a monopoly on talent and profit and efficiency are not the only values for public policy.

And those values deserve at least equal consideration. When you focus on overregulation and not on “government” as the problem, you come to a very different place.

That place is represented by an organization called Common Good. Its founder, Philip K. Howard, describes it as a nonpartisan national coalition dedicated to restoring common sense to America. His book, “The Rule of Nobody,” argues that the fundamental problem is that in an effort to remove corruption in a corrupt world, we have tried to substitute rules for everything, which takes away human discretion. So nothing gets done. People are reduced to paper-pushers in an endless stream of red tape.

Common Good has launched a new campaign called “Put Humans in Charge,” (take-charge.org) headed by former New Jersey Gov. and 9/11 Commission Chairman Tom Kean and former U.S. Sen. Bill Bradley.

One of the worst examples of overregulation is in the development paralysis in Westchester County. John Fareri, whose $1.2 billion proposal for a biotech and medical office complex in Valhalla languished in the county legislature and faces a daunting local approval process, said earlier this year, “I get frustrated because I see what’s happening in Westchester economically and what’s happening in the marketplace and other areas are eating our economic lunch.”

A big part of what’s happening is NIMBY (Not in My Backyard) and the arbitrary implementation of environmental quality review standards to stifle economic and housing development.

So, the problem is not government, but policies and incentives that promote pushing paper instead of getting the job done. Goal-based regulation would insure that projects receive time limits and bureaucrats who delay consideration of approvals would be held accountable.

Towns might be required to publish the time it takes to get applications for development approved. In that way, the towns that discourage development would be exposed and their constituents might start asking questions why their taxes are so high, despite cuts in services. Contrary to popular belief, you can’t just keep cutting services to balance the budget.

Good business practices applied can definitely help streamline government, but business does not have all the answers.

Alexander Roberts is executive director of the fair housing group Community Housing Innovations Inc., headquartered in White Plains. Contact him at aroberts@chigrants.org or 914-683-1010.

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2 Comments

  1. Bill Welch

    “Regulation, not government, is choking business.” And where, pray tell, Mr. Roberts, does the regulation come from if not government?

    • Alexander Roberts

      Blaming government is like blaming a hammer for faulty construction. Government is what keeps us from descending into chaos. Deregulation in the 1990’s caused the Great Recession. The new Consumer Financial Protection Bureau just fined Wells Fargo for a massive fraud that would have continued without government. That said, much of this government’s regulation needs to be paired back based upon benefit cost analysis.

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