Tag: regulations

Big Government, Public Health, and E-Cigarettes, Part II

 

This is the second in a three-part series on e-cigarettes. Part I is available here.

Vapor products contain no tobacco. They produce no smoke. Most contain nicotine and it’s the same nicotine used in FDA-approved gums and patches. While the devices look different, they all operate by heating a liquid solution (propylene glycol and/or vegetable glycerin, nicotine and flavor) to produce an aerosol. Importantly, the products allow users to replicate the act of smoking. Like smokers, vapers engage hands and mouths in a ritual similar to the one they practiced every day for many years as a smoker. Like a smoker, the vaper inhales and exhales and can both feel and see the vapor produced. But unlike cigarette smoke, the aerosol dissipates quickly. There’s no smoke, no tar, and no carbon monoxide – the things that cause half of all smokers to get sick and some to die. Nicotine doesn’t cause lung cancer or make smokers sick. As far as its heath impact, it’s comparable to caffeine. As long as you don’t consume caffeine or nicotine through smoking, most people can use it without incident for an entire adult lifetime. Nicotine also seems to bring health benefits for some.

There is little doubt that part of the consternation of tobacco control groups and regulators simply arose from the fact that products are called e-cigarettes and using them resembles smoking. That reaction is emotional, not rational. Perhaps we can appreciate that it motivates tobacco controllers to investigate further. Rather than investigate and try to understand, however, the FDA initially stepped in and attempted to shut the industry down by banning the importation of e-cigarettes as unapproved medical devices. And electronic cigarette company, NJOY (previously Sottera), was targeted by the FDA and had imported products seized at the US border. NJOY fought the federal government, ultimately winning in court.

Big Government, Public Health, and E-Cigarettes, Part I

 

Since the US Surgeon General’s report on smoking and health in 1964, governments (local, state, federal) and tobacco control groups have waged a comprehensive campaign to encourage smokers to quit and discourage non-smokers from starting. They have used every tool available with cost being of little concern.

They’ve educated about the harms associated with smoking. When that didn’t do the trick, they attempted to shock and scare smokers away from the habit with graphic images. They’re in a half-century cycle to fight for increased taxes. They’ve banned smoking anywhere people congregate. They’ve filed individual lawsuits, class action lawsuits, and lawsuits from state attorneys general (resulting in the tobacco master settlement agreement that forced tobacco companies to pay billions to the states, all costs passed on to consumers via increased prices).

They’ve restricted the ability of companies to sell and market products, restricted use of brand-name advertising and eventually they decided scaring children might discourage them from becoming smokers. They also thought sending terrified kids home to shame their smoking parents could only benefit their cause.

In this AEI Events Podcast, AEI’s Jeffrey Eisenach hosts Federal Communications Commission (FCC) Chairman Ajit Pai for a discussion on the chairman’s first 100 days and his vision for the future of US communications policy. Chairman Pai emphasizes the need to close the digital divide, modernize rules, eliminate unnecessary regulatory burdens, promote entrepreneurship and innovation, protect consumers and public safety, increase agency transparency, and reform agency processes.

In a follow-up discussion, Dr. Eisenach and Chairman Pai discuss the Open Internet Order proceedings and the role of Congress and the courts in addressing the controversial issue, in addition to the importance of ensuring that FCC policies enable competition and empower innovators.

United, Obamacare and Big Coercion

 

Flying home recently on a United black-eye red-eye to Los Angeles, I couldn’t help but reflect on how the parallels between the airline industry and Big Government go a long way to justifying Americans’ contempt for both. The former has for years been shoehorning ten seats into rows which previously had only eight, which is fair enough: that’s the free market in action. But to then charge a fee for the “extra legroom” made scarce as a result? That suggests a scorn for customers normally associated with the political class for its customers.

As evidence, consider how both parties to varying degrees cater to those who receive health insurance subsidies as a result of Obamacare while largely ignoring those who have lost their health insurance as a result of Obamacare. Seen in this context, the ordeal of passing TSA inspection is a kind of boot camp to harden soldier-flyers for the real deal.

The fee-based model now favored by airlines becomes increasingly indistinguishable from a racket: “Nice carry-on you’ve got there, it’d be a shame to lose it.” Some are asking why don’t airlines simply institute a bidding system in which those passengers willing to cough up the most money can avoid an ass kicking altogether. The reason why not is simple: because government regulations place a cap on the amount of money airlines may compensate passengers booted from their flights in order to accommodate employees of the friendly skies. Gee, I wonder who came up with that idea, regulators or the airline industry? (Google “regulation capture” and see if an image of a smiling airline lobbyist waving back at you doesn’t appear on your computer screen.)

David French of National Review and Greg Corombos of Radio America applaud President Trump for aggressively rolling back burdensome federal regulations.  They also wince at new Census Bureau data showing more Americans aged 18-34 live with their parents than with a spouse, a major shift from 40 years ago.  And they brace themselves for Barack Obama’s first public appearance since Inauguration Day and discuss how active Obama is likely to be in policy debates.

Ross: Trump Team Is “Up to Our Eyeballs” Finding Red Tape to Cut

 

Newly confirmed Commerce Secretary Wilbur Ross told CNBC’s “Squawk Box” that Trump’s economic advisors “are up to our eyeballs” looking for government regulations to be scrapped. From Politico:

Trump, who campaigned on an economic message of growth and job creation, has made reducing government regulation a priority in the opening weeks of his presidency. Just 10 days into his administration, the president signed an executive order mandating that for each new regulation put into effect, two others must be removed. And last week, Trump signed an order requiring federal agencies to create regulatory reform task forces.

Speaking on CNBC Friday morning, Ross said he would seek the input of business groups including the National Association of Manufacturers, the U.S. Chamber of Commerce, the National Federation of Small Businesses and others. He estimated that the Trump administration may ultimately save U.S. businesses “way into the tens of billions of dollars and very possibly approaching a hundred odd billions of dollars.”

Regulatory Reform as One Piece of the Growth Puzzle

 

I’ve grown increasingly skeptical of magic bullets, or silver bullets, or big-bang ideas to charge up the American growth machine. More likely it’s going to take lots of smaller-but-smart ideas all doing their bit to make the US more productive. That said, one area with potential is regulatory reform, as I pointed out yesterday with some encouraging comments about President Trump’s “one in, two out” executive order.

Still, just how much growth impact can be expected from regulatory reform on a number of fronts? What’s the potential here? The WSJ’s Josh Zumbrun offers a cautious, balanced take.

Broadly speaking, there are two approaches to estimating costs and benefits. A “bottom up” approach aggregates estimates for each individual regulation. A “top down” approach relies on economic modeling to show the overall effect of regulations on growth. The Office of Management and Budget already estimates the cumulative cost-benefits via an annual report to Congress. In its most recent report, OMB estimated regulatory costs of between $74 billion and $110 billion. The benefits of the regulations, however, were significantly higher: $269 billion to $872 billion. …

Greg Corombos of Radio America and David French of National Review discuss President Trump’s orders seeking to reduce federal regulations.  They also say Trump is on the right track with his refugee policy but did not implement it well, and they unload on the hysterical left-wing reaction to the policy.  And they practice their shocked faces as Iran defies the United Nations and tests a ballistic missile – the ones that carry nuclear warheads.

Trump’s “One in, Two out” Regulatory Reform Could Help Economic Growth

 

President Trump is employing what you might call the “Mad Max: Beyond Thunderdome approach” — “Two men enter, one man leaves!” — to regulatory reform, except sort of in reverse. If a new regulation is to enter the regulatory code, two must leave. Following through on a campaign pledge, Trump today signed an executive order requiring, as Reuters puts it, “that for every new federal regulation proposed, two must be revoked.”

A bit of typical Trump color on this:

This will be the biggest such act that our country has ever seen. There will be regulation, there will be control, but it will be a normalized control where you can open your business and expand your business very easily. And that’s what our country has been all about.… If you have a regulation you want, number one, we’re not gonna approve it because it’s already been approved probably in 17 different forms. But if we do, the only way you have a chance is we have to knock out two regulations for every new regulation. So if there’s a new regulation, they have to knock out two.

Richard Epstein shares his reaction on learning that Donald Trump will be the 45th president and provides recommendations for the new administration’s policy agenda.

Banning Hamburger: Housing Codes in America

 
shutterstock_242818684

Mulberry Street in New York City’s Little Italy, ca. 1900.

If a liberal observes that rich people are eating steak, while poor people are eating hamburgers, the obvious solution is to ban the hamburger. It sounds silly, but if you apply this rule, for example, to the minimum wage for teenagers, it all comes into focus. It is “obvious” that people should not be underpaid — and so we must forbid low-paying jobs. Steak or bust.

The Tyranny of the Regulations Equation

 

ORocketAnyone who has ever built a rocket — or played at it on a computer — has encountered “The Tyranny of the Rocket Equation.” First identified in the 19th century, one of its consequences is that, at a given point, the costs of carrying more fuel outpace the benefits. Pushed past that point, the rocket either becomes inefficient in its early stages (and consequentially doesn’t take-off) or simply becomes so large that it collapses under its own weight. If a more down-to-earth illustration of the same principle suits you, consider the problems of hiking while carrying all your own food: eventually, the added benefit an extra granola bar provides is outweighed (literally) by the energy it would take to haul it up a mountain … that, or it simply rips your backpack open.*

As a piece in today’s WSJ illustrates, the same conundrum applies to regulations meant to give us a better welfare state:

U.S. regulators are pushing stricter rules for stores that accept food stamps, ultimately determining which retailers win and lose the billions of taxpayer dollars at stake. The proposal is throwing gas stations and corner stores into a battle with giants like Wal-Mart Stores Inc. and Kroger Co. over the $74 billion Supplemental Nutrition Assistance Program, or SNAP.

Member Post

 

I just received this email from my payroll services company. Dear Valued Client, The U.S. Department of Labor has announced the details of its final overtime expansion rule, which would essentially double the salary threshold at which workers are eligible to receive overtime, making a major change to employee exemption under the Fair Labor Standards Act (FLSA). […]

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Tennessee Is Criminalizing Shampooing

 

shutterstock_281446382In a new column over at Forbes, Nick Sibilla from the Institute for Justice (IJ) details the case of Tammy Pritchard, whose attempt to earn a better living as a part-time shampooer in a friend’s beauty salon in Tennessee has been stymied by the state’s restrictive occupational licensing laws.

“Unfortunately for Tammy, unlicensed shampooing is a crime, punishable by up to six months in jail. The Tennessee Board of Cosmetology and Barber Examiners can also impose civil penalties as high as $1,000 for those who dare to lather, rinse and repeat without a license…

“Before she can legally wash hair at a salon, Tammy must finish 300 hours of training on “the practice and theory of shampooing.” In a course more fitting for Greendale Community College, prospective shampooers learn about the “chemistry and composition of shampoos and conditioners,” “shampooing and rinsing foreign material from hair,” and “shop management,” which covers remedial skills like “answering phone, scheduling appointments, ordering supplies.” After completing the class, shampooers then have to pass two exams, one on “theory,” the other practical, to obtain their license.”

Laws Are Not Force Fields

 

shutterstock_344065673It would seem a self-evident truth that laws are not force fields. Simply creating a rule does not in and of itself change anyone’s behavior. Unenforced laws are useless. This would seem to be a strong argument in favor of only passing laws whose enforcement can be done in a practical manner, and which do not duplicate existing law.

Not so, says the Democratic Party. Whether it be their desire to emote about how much they care, even when they are powerless to do anything of consequence, or a genuine belief that they can bend human nature to their will with words alone, the result is the same. There are problems in the United States, and regardless of the specifics, the Democrats have a law ready to solve it.

The most obvious examples are gun free school zones. In order for such laws to have value, one would need to station guards at all entrances to schools, and check all who enter for weapons. Some government buildings do this, and such laws can be rational under such circumstances. Yet the notion that schools are safer when only the law abiding citizens have been disarmed is laughable. A man who has already decided to violate the most sacred of all prohibitions against murder, is certainly willing to violate your petty gun carrying laws.

The FDA’s Looming Regulatory Onslaught Threatens the Freedom to Vape

 

shutterstock_299809835Americans who are trying to kick their nasty smoking habit have found healthier alternatives in e-cigarettes and vapor products that could, quite literally, save their lives. But the bureaucrats at the Food and Drug Administration are trying to put this $3.5 billion industry out of business.

Small mom-and-pop shops have sprung up across the country to meet the growing demand for vapor products, which allow users to refill their vaporizers with their favorite e-juices. Separately, big tobacco companies have invested in non-refillable e-cigarettes.

Though these products are not always tobacco-free; there’s no ash or smoke involved. But they do contain nicotine, which users can gradually reduce if they choose. E-cigarettes and vapor products contain far fewer chemicals and carcinogens than traditional tobacco cigarettes, making them safer for the users, as well as those around them. “[T]he levels of potentially problematic substances in e-cigarette aerosol,” Reason’s Jacob Sullum wrote in March, “are about the same as those detected in ambient air.”

Giving Thanks For Congress

 

Screen Shot 2015-06-12 at 12.56.48 PMEvery Thanksgiving I sympathize with lobbyists: can you imagine sharing their obligation to feel grateful for Congress? Amidst the vast, un-American growth of the administrative state, the world’s greatest deliberative body continues to do what it does best: taxing our children and passing the savings onto us.

The distinction progressives make between public and private is a false one. Many Americans know what it’s like to struggle beneath the weight of debt: not a day that goes by when my mailbox isn’t stuffed with offers from Visa or MasterCard informing me that I have been pre-declined.

Recall the heyday of the Tea Party, which relentlessly pointed out that every penny of the stimulus would have to be paid for by our children and grandchildren. Frankly, that’s the only thing I like about it. Even the New Deal wasn’t able to extend the Great Depression beyond a decade. Today, nearly one decade after the orgy of spending instituted during the George W. Bush administration, crony capitalists can say it was worth it. With each passing year, it seems government assumes more and more responsibility for our lives. Take solar subsidies — please! As Republicans and Democrats debate how much taxpayers should fund solar energy, let’s take a step back and realize that politicians have figured out a way to charge us for the sun.

Laissez-faire SCUBA (Part 3): Coming Up for Air

 

You can read Part 1 of the Laissez-faire SCUBA series here and Part 2 here.

shutterstock_226671082We’ve already seen how SCUBA diving developed an astonishing record of safety and success free of governmental involvement. But what if government had regulated the industry from the beginning? Let’s contrast it with one where the government took on the role of safety guarantor: the recreational aircraft industry.