Obama's New Stance on Competitiveness and Regulation

Monday, January 24, 2011

Welcome to Politics Bites, where every afternoon at It's a Free Country, we bring you the unmissable quotes from the morning's political conversations on WNYC. Today on the Brian Lehrer Show, Rena Steinzor, President of the Center for Progressive Reform, and Jerry Bowyer, author of the Free Market Capitalist's Survival Guide offered opposing perspectives and discussed the Obama administration's new focus on "competitiveness" and regulatory reform.

The President is shifting gears a bit and putting some fire in his step leading up to the State of the Union. The focus of his speech on Tuesday night will be: staying competitive, to "out-innovate, out-build, out-compete, out-educate other countries," he says. Part of this plan, as he said in his Wall Street Journal op-ed last week, is to modernize the regulatory system by removing outdated and "dumb" regulations and creating new ones.

Rena Steinzor said the president is trying to appeal to business interests, but said regulations themselves aren't the problem. It's their enforcement that isn't working.

I think what we have going on right now is a bad case of regulation failure and just as an example, the oil spill in the gulf of Mexico this summer clearly resulted because the regulators were not on the job policing. The alternative to regulation is that industry takes care of business itself, and that's not corporation's main strength. Their main strength is to make money.

Jerry Bowyer said Obama's new move isn't a very convincing shift.

I don't think Obama 2.0 is really an upgrade. I think it's the same Obama, but just with a different package.

He says big business really loves regulations, but regulations make life harder for small business.

There are few groups in America that are less hostile to the free market in many cases than large business interests and that misunderstanding creates a convenient way to push for more regulation when people have a certain resistance to big business. But in fact it doesn't comport with reality. Big business loves regulation because big businesses have big compliance departments that allows them to deal with regulatory barriers to entry and the small businesses which are competing with them do not have that.

According to Steinzor, we haven't had a free market in a long time and the idea that dropping regulations would bring back a free market anytime soon is an "illusion." She returned to her example of the oil spill in the gulf.

If the government cannot put cops on the beat to make sure that people are operating safely than what we get is this kind of uncontrolled blow out because companies don't have non-internalized safety culture and have very little motivation to do it, so I'm for policing big business.

Bowyer turned her example on its head.

Why was Brittish Petroleum out in deep water drilling for oil where the threat of a spill is much greater and the safety concerns are much more egregious? Well, because it's illegal to drill in shallow water. That's a regulation. Now small oil producers would love for it to be legal to drill in shallower water because it doesn't require tens of millions of dollars... but the government says no, you're not allowed to do that... So people who push the regulations, that pushed the rig way out into the deep water now say it's just a failure of regulations, we need more regulations. I say, no. You want less deep water drilling? Then allow shallow water drilling.

Amidst the back and forth, the only thing Bowyer and Steinzor did agree on is that we no longer have a free market. Steinzor would not admit to regulations souring things for small business (or making life better for big business). She said while Bowyer is pushing small business to the forefront and denouncing big companies, his perscription will not help small business at all.

It is very clear to me that the alternative to strong regulation is a sort of wild west atmosphere where the consumer and the person that breathes the air and the children that play in the playground are put at risk from bad practices.

That drew this retort from Bowyer:

I'm not pushing small business to the fore. I'm not pushing big business to the fore. I'm saying whichever business can honestly capture market share and provide the best product at the best price ought to be able to win. What I don't like is a situation, which is what we have right now, where government and big business are in collusion that helps big business and hurts small business.


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Comments [17]


Appreciating the dedication you put into your site and
in depth information you present. It's nice to come across a blog every once in a while that isn't the same
out of date rehashed material. Excellent read! I've bookmarked your site and I'm adding your RSS feeds to my Google account.

Mar. 07 2013 08:18 AM
Amy from Manhattan

So every subsidy is a regulation? And we already know every fee & fine is a tax. What does that leave for government to do?

Jan. 25 2011 12:20 AM

I dont think BP tradgedy was the best option for the guest to analyze.

As a small business owner here in NYC, I know first hand how idiotic regulations impact small business.

Paying a $500.00 fine for buying bread from a local NYC bakery because it did not have a a plastic bag with a ingriedient list that states "no trans fats" is a true crime.

I love the show but really wish you would invite guests that have real world business experience.

Jan. 24 2011 09:18 PM
Gerald Fnord from Palos Verdes,CA

Mr Bowyer has a good point: all automobile engines not air-cooled would run _much_ more efficiently if they were not hampered by being hooked up to a transmission and car.

If they must be so, they'll still be more efficient if they're not oppressively forced to turn and to start and stop by someone who thinks that there are right ways to use the engine (getting a child to school) and wrong ways (running over a child).

Jan. 24 2011 11:15 AM
art525 from Park Slope

Well Bowyer certainly has the better debating skills. It's unfortunate that he appears to win the debate just because he is a more aggressive debater and not on the substance of his argument. I see that he is the founding president of the Allegheny Institute for Public Policy which was launched by Richard Mellon Scaife. Remember him? he was the guy who financed the attempt to impeach Clinton. An extreme right winger and zealous activist.

Jan. 24 2011 10:27 AM
Otto Cosmopolis from Cold Spring

This guy blames regulations for BP oil spill. BP is drilling in deep water because that's where they need to go to get oil. Given that they are making huge profits, is it too much for the public to expect that they have a plan and are able to take care of accidents

Jan. 24 2011 10:26 AM
Otto Cosmopolis from Cold Spring

This guy blames regulations for BP oil spill. BP is drilling in deep water because that's where they need to go to get oil. Given that they are making huge profits, is it too much for the public to expect that they have a plan and are able to take care of accidents

Jan. 24 2011 10:24 AM

Brian Lehrer's show sounds like it did during the Bush years 2001-2007.
Bringing on Libertarian corporate funded so called "experts".
That was quick Brian.
You know who butters his bread.

Jan. 24 2011 10:21 AM
Zach from UWS

And isn't that the ultimate Libertarian logical fallacy? Deep water drilling wouldn't be a problem if only we could drill closer to our shores. Also, people wouldn't be addicted to methadone if they could only have easier access to heroin.

Jan. 24 2011 10:20 AM

What's being overlooked re: shallow vs. deep-water drilling is that we have exhausted most of the resources close to shore--that's why BP was drilling so far out in the Gulf when the Deepwater Horizon exploded.

Jan. 24 2011 10:20 AM

What "safe" means is not just rigs not blowing up. It is safer to not drill near the shore because it is unsafe in a more comprehensive ecological sense over a time period longer than the next quarter.

Jan. 24 2011 10:19 AM
rlewis from bowery

That guy just did a great job of dodging the issue. Sure, he's right: it's easier to plug a hole in shallow water. But, but, the damage is done faster and with greater impact in shallow water. No matter how fast you plug it, the greatest damage is already done. Too late. But he did do a fine job of shirking the true issue.

Jan. 24 2011 10:18 AM
Steve S. from Washington Heights

This guy's right! We should support mom and pop oil drillers!

Jan. 24 2011 10:16 AM

2 extremists

Jan. 24 2011 10:15 AM

Which jobs have gone to China because of regulations?

Jan. 24 2011 10:13 AM

Agree w this guy's opening statements... not sure why he's picking on "green"... i'd start with Bush's generic drug ban or farm subsidies...

you wanna see a real free market btw look at china's small and medium sized enterprises. forget the us, if there's anything worse for the free market than a democratic president, based on the past 20 years, it's a republican congress.

Jan. 24 2011 10:13 AM
Paul from Ridgewood NJ/NYC

Yeah yeah. Big business is pro-regulation, and regulation only "hurts" the little guy.

I have a couple of choice NYC bridges to sell you if you buy that line.

Jan. 24 2011 10:12 AM

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