Feeling A Little Scrooged This Morning

Sometimes when I see things on the news or in the paper I think back to the scene from Scrooged where Bill Murray is pleading with the set crew to “Stop the hammering!”  I’d like to ask our political leaders and our press corps to stop the hammering on things that aren’t true.  Senator Pat Toomey (R-Fracking) was on Movement Conservative Joe this morning hammering on about how we have a supply side problem and not a demand problem.  These guys need to update their software, they’re running a version of Senator 1.1 from 1983.

They hammer and hammer and hammer on about things that simply aren’t true.  I’ve given up calling them zombies because, given enough shotgun shells, you can put a zombie down.  These damn lies simply won’t die.

What really galls me today is the whole “Regulations are killing jobs” meme.  There is simply no evidence (i.e. data, not Wall Street Journal Opinion pieces) that there is any causal link between regulations and job creation.  In fact, there is some evidence that regulations actually encourage job creation.

The Treasury has joined the deafening chorus of voices saying that regulations aren’t the problem.

Last week at a Senate hearing Secretary Geithner said, “I’m very sympathetic to the argument you want to be careful to get the rules better and smarter, but I don’t think there’s good evidence in support of the proposition that it’s regulatory burden or uncertainty that’s causing the economy to grow more slowly than any of us would like.”

Economists from across the political spectrum have also weighed into this debate and reached the same conclusion. Bruce Bartlett, a senior advisor in both the Reagan and George H.W. Bush administrations, said that “no hard evidence” has been offered for claims that regulation is the “principal factor holding back employment.” And in a recent Wall Street Journal survey of economists, 65 percent of respondents concluded that a lack of demand, not government policy, was the main impediment to increased hiring.

Nonetheless, two commonly repeated misconceptions are that uncertainty created by proposed regulations is holding back business investment and hiring and that the overall burden of existing regulations is so high that firms have reduced their hiring.

“For the love of God, would you please stop the goddamn hammering!!!!”  What really makes me laugh is this little nugget tucked away in footnote 1:

Similarly, recent work by Jay Livingston has shown that the unemployment rates in sectors where regulation has been increasing are actually below the national average.

You simply can’t make this stuff up.  Unemployment in highly regulated sectors of the economy is lower than in other sectors.  Lower.  Not higher.  Lower.  Regulations don’t hurt job creation or growth.


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