Monday, March 5, 2012

Create Jobs, or Fix Imaginary Problems?

Since the 1960's, certain political groups have hypothesized that the government needs to regulate industry for the sake of the environment. It is clear that some industrial practices can harm the environment; there is no doubt that dangerous emissions have damaged air and water quality in specific cases. But is government regulation the best way to address those situations?

The trend for several decades has been constantly increasing regulation, with occasional periods of respite when rules were relaxed for the sake of giving well-paying jobs to the Americans who needed it most. These regulations took their toll on workers, eliminated some jobs, and reducing pay in others. But did these regulations actually do anything to help the environment? Historian Howard Zinn states that

Reflecting on this years later, Herbert Stein, who had been the chairman of Nixon's Council of Economic Advisers, lamented that "the juggernaut of environmental regulation proved not to be controllable by the Nixon administration."

Specifically, Nixon had signed the OSHA (Occupational Safety and Health Act) into law in 1970.

Regulations which failed to help the environment simply caused unemployment and suffering for those at or near the poverty level. Meanwhile, non-regulatory measures were making real progress toward protecting the environment. Without legislation, the American consumer gradually phased out the use of chlorofluorocarbons and other chemicals. Giving people options, and letting them choose, proved to be a significant step toward protecting the environment - without coercive regulation.

In a different part of the world, this principle was being taken to an extreme. The eastern European countries of Poland, East Germany, and Czechoslovakia - under the domination of the Soviet communist army - had the most controlled economies on the globe, and the worst environmental conditions. Pollution was at its worst behind the Iron Curtain in the Soviet Bloc countries, proving that regulated economies do not help the environment.

Meanwhile, rules continued to intervene in the marketplace, stifling job creation. By the late 1970's, Jimmy Carter was president, and economic misery started by oil supply issues was being made worse by various regulations which prevented the marketplace from fixing itself. Economies are self-correcting mechanisms, and automatically restore themselves to equilibrium, if allowed to do so.

But as the American economy showed signs of trouble, Carter seemed more and more concerned about the difficulties the act created for businesses. He became an advocate of removing regulations on corporations and giving them more leeway

to create new jobs. This cycle - new regulation signed into law, and later to be gradually reduced when it is discovered that it helps neither the environment nor the working class - would be repeated in the next few decades. Although well-intended, regulation doesn't help the environment as much as a free marketplace.