A Different Attitude Toward Regulation — Bullying, Aggressive

By July 12, 2010General, Regulations

In the post below we cite presidential adviser David Axelrod on the Obama Administration’s approach toward business. Axelrod contends: “We need commonsense environmental policies to — to prevent what happened in the — in the gulf, and you can’t simply let industry in each and every case self-regulate. We’re not micromanaging anything, but we are looking after the public interest.”

The folks in the trenches have another view.

Attorney, law professor and national radio talk show host Hugh Hewitt publishes a letter from an acquaintance in the business of “environmental compliance consulting,” that is, advising manufacturers “to help them comply with the myriad and labyrinthine environmental regulations that control how they operate.” Small business, “mom and pop” stores, struggle to comply, Hewitt’s contributor reports:

They work very hard to be good citizens, which includes compliance with environmental regulation. However, they are not lawyers, or regulatory scholars, chemists or engineers – “decoding” and applying regulation. assuming they even know a particular reg exists, is simply outside of their capability.

Hence, a reasonable, effective and familiar approach from government agencies is to work with these companies so they can quickly reach compliance. But recently …

[Lately] I have noted a big change. I have seen a marked and large spike in administrative enforcement action from agencies on all levels of government, even after a company has rapidly and completely achieved compliance. Not only are there more such cases – many more – but the fines sought have risen dramatically. Prior to the last six months, when such enforcement action was taken – if the company had been cooperative and achieved compliance – fines sought would be of the nuisance variety. That is to say a few thousand dollars. But since the beginning of 2010 I have seen the fines sought rise, in more than one case, to levels of 20-25% of the gross annual sales of the company in question.

The methods by which such exorbitant fines are extracted are certainly unpleasant, to say the least. What are supposed to be negotiations are generally exercises in intimidation by the agency in question – often accompanied by the prosecutorial department of their particular branch of government. People that have clearly acted in good faith are treated to accusations and characterizations that I have seen bring grown men to tears, or worse physical manifestations.

This can’t be Axelrod what means “by looking after the public interest.”

Read the whole thing.

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