Statist quo - regulatory reform

Reason, April, 1996 by Rick Henderson

"Big government": more than taxes and spending

Twice during his state of the Union address President Clinton said, "The era of big government is over." Yet the president belied his centrist appeal by recommending a litany of new federal initiatives, from regulations on television programs to tax-funded scholarships for the smartest high-school students. And his remarks clearly demonstrate that the White House and many in Congress willfully ignore a major cause of the growth in government - the expanding regulatory state.

Regulations are, after all, an indirect form of taxation. They force people to change their behavior without paying them for their time and trouble. Some estimates place the cost of federal regulations as high as $900 billion a year - more than half again as much as we pay for federal programs in cold, hard cash. So even if Congress and the president agreed to balance the budget and included a middle-class tax cut in the bargain, without attacking regulations, government will remain as intrusive as ever.

Clinton used his speech to endorse new initiatives that might not cost much money but would make government bigger rather than smaller. His new regulatory programs would generally have three effects:

* They would limit privacy. The telecommunications bill Clinton signed in February would force television manufacturers to install an anti-violence "V-chip" in every new set: once the V-chips are activated, government-sanctioned censors, rather than parents, would be in charge of what children can watch. Clinton also asked broadcasters to "improve what our children see on television" - a seemingly harmless suggestion unless you know that Federal Communications Commission Chairman Reed Hundt wants the government to mandate the number of hours and the content of "children's programming" broadcasters must air.

The president also urged the House of Representatives to enact the anti-terrorism bill the Senate passed last year. This bill would dramatically expand the ability of the federal government to tap telephone lines without getting court orders and would (in its current form) define terrorism so broadly that aggressive prosecutors could consider many garden-variety domestic disputes acts of terrorism - a federal crime that offers few due-process protections to the accused.

* They would restrict legitimate business activities. The president called for an increase in the national minimum wage, an action that prevents businesses from hiring low-skilled employees to perform entry-level jobs. The president also wants Congress to require broadcasters to either give away commercial time or reduce advertising rates during political campaigns, a proposal some critics have called "food stamps for politicians."

The president encouraged businesses to "find a cheaper, more efficient way than government regulations to meet tough pollution standards." Yet his administration opposes congressional reforms in wetlands and endangered-species protections. Those reforms would give individuals and businesses incentives to preserve private property rather than destroy it or surrender it to government regulators.

* They would have the federal government usurp state and local authority. With few exceptions (mainly customs violations and treason), the Constitution makes criminal law enforcement solely the responsibility of state and local governments. Yet Clinton asked Congress to leave in place the 1994 crime bill, which micromanages local law enforcement. He also asked public school systems to adopt national educational standards.

Even the seemingly trivial suggestion the president made to allow public schools to require student uniforms shows an insensitivity to the limits of federal authority. Clinton wasn't calling for Congress to pass any new laws, but his intent was clear: Everything you and your children do is the federal government's business. "The president can't do your children's homework for them," said former California Gov. Jerry Brown during the 1992 presidential campaign. But apparently Bill Clinton thinks he should determine your school's dress code.

To be fair, Congress isn't blameless. Bipartisan majorities support the anti-terrorism bill; Republican senators have joined with Democrats to filibuster regulatory reforms. But all of the deregulatory energy in Washington - in freeing telecommunications, reining in the Food and Drug Administration, and protecting the rights of property owners - has originated from Capitol Hill.

Cutting taxes and balancing the budget are important goals. But achieving both would not necessarily halt the advances of big government. The only sure way to reduce the size and scope of government is to pare back the regulatory state, a task leaders of both parties have failed to encounter head-on.