Government Regulations Likely to Backfire Again

What is the easiest way to kill an industry – any industry? The answer is to inject government into the equation. Government has long been a thorn in the side of American business. And it is also the answer to lessening competition for those crony corporations who, through donations and graft to politicians, are able to virtually lock out up-and-comers with a better mousetrap. As I’ve stated many times – the government takes it upon itself to pick winners and losers, as it has done for decades.

So how does government ruin companies and entire industries? Well, they can punitively tax them, but this has to be done legislatively and must be at least loosely based on the Constitution. That’s far too much of a hassle, and also must affect all people or businesses. Oh, and it’s also far too public.

No, this the answer is and has been the Administrative State – bureaucratic regulatory bodies within the government whose dictates often go unheard and unseen to the general public, but whose rules and regulations carry the full weight of law – without the legislative entanglements and fanfare.

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Save for the relatively informed few like us, most Americans are still virtually unaware of the havoc the EPA has wrought on the coal industry or of their stated goal to kill it off completely. The general public may only notice an increase in their power bill, which many will simply chock up to corporate greed.

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But the Regulatory State may also be used to simply change public behavior the government nannies find to be offensive, like cigarette smoking. Tobacco companies have a huge international footprint, so there is no way for even the feds to kill them off. Plus, they and the states really like the punitive tax revenue collected on each and every pack.

Still, through “stiff regulations, a massive lawsuit and relentlessly higher taxes,” the feds have gone a long way to changing public perception and behavior regarding cigarette smoking. But human beings will fill the void of this increasingly expensive and stigmatized habit somehow.

So private sector innovators developed the electronic cigarette, or e-cig. “Instead of burning tobacco leaves,” e-cigs vaporize “nicotine when the ‘smoker’ puffs on it. Vapers, as they are sometimes called, can get their nicotine fix without risking lung cancer.”

For years now, e-cig users have gotten their nicotine fix free of harmful, cancer-causing carcinogens. And it’s also a benefit to those who interact with the smoker, although the whole second-hand smoke thing was proven to be a total crock. As one second-hand smoke researcher put it: “The strongest reason to avoid passive cigarette smoke is to change societal behavior: to not live in a society where smoking is a norm,” said Dr. Jyoti Patel of Northwestern University School of Medicine.

For years, the e-cig industry has done just fine without government interference. But that is government’s job – to interfere with and regulate industry. They can’t have businesses just doing what they want without oversight. That’s not the American way. For all our own good, government must therefore regulate the e-cig industry.

A recent study caused researchers to conclude that the evidence “suggests strong potential for (e-cigarettes) to improve population health” and that “Government imposed costs or access restrictions would likely drive many back to cigarettes.”

Yet, despite this, the FDA is instituting onerous regulations on the e-cig industry which might just result in driving “many back to cigarettes.” Under the new rules, manufacturers must apply for approval to sell their products and just “the application process alone — about $1 million per product — and the uncertainty it creates will likely be enough to drive smaller companies out of business.”

These misguided regulations, as they always do, inflate the cost of innovators’ much safer products, thereby driving lower income people back to smoking regular cigarettes. And here we thought the government was/is looking out for the little guy.

As IBD puts it: “In the end, the FDA’s onerous regulatory regime reveals that this agency isn’t so much interested in improving public health as it is in dictating personal behavior.” And that’s exactly what Dr. Patel admitted. It’s all about changing societal behavior – and confiscating more money for the government. Let’s not forget that.

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