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Levick Daily. Thoughts. Perspectives. Insights.

Public Affairs

When Winning Means Losing: Why the Private Sector Can Expect More Regulation in 2014

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By Neal Urwitz
 
As President Reagan said, the nine scariest words in the English language are “I’m from the government, and I’m here to help.” That has been the Republican mantra ever since. Government is too large, and needs to be downsized. The mission was to get government out of the way so private industry to flourish.
 
A quarter of a century later, regulations are as large and complicated as they’ve ever been. Companies are more confused by – and spend more money working on – compliance than they ever have before. The U.S. tax code is still five times as long as the Bible. What happened?
 
In short, Republican tactics did not work towards Republican objectives.
 
Republicans – in their earnest desire to not pass legislation that would expand the size of government – ended up leaving the regulatory agencies with no choice but to institute regulations. Regulatory agencies did not get the direction from Congress that they are supposed to under our system of government. But the IRS still needs rules for how it collects taxes. Elementary and Secondary Education Act funding still needs to flow to the states. Power plants still need to know what they are and aren’t allowed to admit. The Department of Justice needs to prosecute criminals and the Department of Transportation still needs to deem cars safe or unsafe.
 
In other words, the government has to keep on working, whether it has a mandate from Congress or not.
 
Accordingly, we were left with string of what were arguably illegal – but clearly unavoidable – overreaches by successive administrations. True conservatives are outraged by items like:

  • The waivers the U.S. Department of Education gave all but a handful of states from No Child Left Behind. ED had no choice – under the rolling standards of NCLB, nearly 80% of U.S. public schools would have been declared “failing” and met with harsh remedial initiatives designed for the lowest performing schools in the country. Congress could not (and still cannot) find a legislative alternative. So, ED is forced to make its own rules.
  • Net neutrality legislation went nowhere in Congress. Yet internet providers still need to understand how they are allowed to provide services. Accordingly, the FCC has been forced to make regular updates to an initial mission statement on net neutrality that it passed in 2005 and which is remarkably out of date.
  • The last comprehensive tax code legislation was passed in 1986 – before internet commerce, electronic tax-filing, and Quicken and its ilk. So who sets the rules for how these massive industries and taken-for-granted tools can operate? A host of government entities – and not Congress.

Like any good discussion of regulation, this list could go on for hundreds of pages.
 
By any definition, this is not what true conservatives had in mind. If overreach by Congress was bad, overreach by largely unaccountable government bureaucrats is much worse. At least if you disagree with what Congressmen are doing, you can vote them out. It’s tough to vote out, say, the IRS Acting Commissioner for Tax Exempt and Government Entities Division, who is two rungs on the ladder below the IRS Commissioner and is probably not someone you’ve read about in The New York Times.  (By the way, I have nothing against Michael Juliannelle. But he’s not as high profile as John Boehner or Harry Reid.)
 
In preventing legislation that would expand the size of government, then, conservatives managed to expand government through the back door.
 
The lesson here is that you cannot call a series of tactics a strategy. While every strategy eventually becomes a series of tactics, a campaign must begin with a clear objective. More important, it must concretely state how the series of tactics will lead to the given objective. The last thing any business can afford is “underpants gnomes” thinking (i.e., the underpants gnomes in South Park have no ideas how their business tactic of “stealing all the underpants” will lead to their objective of “profit”).
 
Without a good game plan, you can execute your tactics flawlessly – and still, like the modern Republican Party, achieve the exact opposite of your objective.
 
Neal Urwitz is a Director at LEVICK. He is also a contributing author to LEVICK Daily.

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